Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions: (a) The Company shall deliver a notice by certified mail (“Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares. (b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe. (c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith. (d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Apptio Inc), Investors’ Rights Agreement (Apptio Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this shall first offer that portion of such New Securities prescribed by Section 2.3 4.1(b) to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Board, (y) agrees to enter into this Agreement and the Voting Agreement of even date herewith among the Company, the Investors and the other Company stockholders party thereto, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who that desire to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or (iii) the issuance of securities that Participation Rights Holders holding a majority additional shares of Series B Preferred Stock after the date of this Agreement pursuant to Section 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement, or (iv) any Investor that is a Foreign Person and as to which the operation of this Section 4.1 could result in writing such Investor obtaining greater than nine and nine-tenths percent (9.9%) of the outstanding voting shares of the Company.
(e) Notwithstanding any provision hereof to exclude from the contrary, in lieu of complying with the provisions of this Section 2.3; provided4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Section 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Energy Exploration Technologies, Inc.), Series B Preferred Stock Purchase Agreement (Energy Exploration Technologies, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. Each Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right hereby granted to it among itself or and its Affiliated Persons, partners and Affiliates in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities) and full exercise (the “Regular Pro Rata Amount”); provided, however, that the pro rata participation amount of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases New Leaf in the Next Financing shall be completed at equal to three (3) times the same Regular Pro Rata Amount applicable to New Leaf (“New Leaf Super Pro Rata Amount”). The closing as that of any third party purchasers or at an additional closing thereundersale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c). The Company shall promptlynot take any voluntary action including, in writingbut not limited to, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion amendment of the Shares Certificate of Incorporation, reorganization, recapitalization, transfer of assets, consolidation, merger, issue or sale of securities, for which Participation Rights Holders were entitled the purpose of avoiding or seeking to subscribe but which were not subscribed for by avoid the Participation Rights Holders that is equal application of New Leaf’s right to purchase up to the proportion that New Leaf Super Pro Rata Amount in the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeNext Financing.
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice; provided, however, that in the event that New Leaf purchases less than the New Leaf Super Pro Rata Amount in the Next Financing, then the unsubscribed portion of such New Securities shall be reduced by that number of shares equal to the New Leaf Super Pro Rata Amount less the greater of New Leaf’s Regular Pro Rata Amount for the Next Financing and the amount of New Securities actually purchased by New Leaf in the Next Financing. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series B Preferred Stock to Additional Investors pursuant to Subsection 2.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Dimension Therapeutics, Inc.), Investors’ Rights Agreement (Dimension Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes to offer any additional shares ofExchange Act, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance such Major Investor (“SharesInvestor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner agrees to enter into this Agreement and each of the Amended and Restated Voting Agreement and Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Company shall first make Investors and the other parties named therein, as an offering “Investor” under each such agreement, and agrees to purchase at least such number of such Shares New Securities as are allocable hereunder to each Participation Rights Holder in accordance with the following provisions:Major Investor holding the fewest number of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then held by all the Major Investors (including all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by all the Major Investors). At the expiration of such twenty (assuming full exercise20) day period, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred and twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO and (iii) the issuance issuances of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Series B Preferred Stock pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Tyra Biosciences, Inc.), Investors’ Rights Agreement (Tyra Biosciences, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among (i) itself, and (ii) its Affiliates; provided that each such Affiliate (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Series A Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Series A Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Series A Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series A Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series A Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series A Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Nerdwallet, Inc.), Investors’ Rights Agreement (Nerdwallet, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board, (y) agrees to enter into this Agreement and each of the Voting Agreement and the Right of First Refusal and Co-Sale Agreement, as a primary issuance an “Investor” under each such agreement (“Shares”provided that any Competitor or FOIA Party shall not be entitled to any rights as an Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding) At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended Restated Certificate); and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO.
(iiie) Notwithstanding any provision hereof to the issuance contrary, in lieu of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Investor, maintain such Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Galecto Inc.), Investors’ Rights Agreement (Galecto Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue ROFO Party. A ROFO Party shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such ROFO Party (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance Board, and (“Shares”)y) agrees to enter into this Agreement and each of the Fifth Amended and Restated Voting Agreement of even date herewith among the Company, the Company Investors and the other parties named therein and the Fourth Amended and Restated Right of First Refusal and Co-Sale Agreement, dated as of September 6, 2019, among the Company, the Investors and the other parties named therein, in each case as an “Investor” or “Key Holder”, as applicable, under each such agreement (provided that any Competitor shall first make not be entitled to any rights as an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Investor under Subsections 3.1, 3.2 and 4.1 hereof).
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each ROFO Party, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder ROFO Party may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion its Pro Rata Portion of such Shares which equals New Securities. At the proportion that expiration of such twenty (20) day period, the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder ROFO Party that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderROFO Party’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders ROFO Parties were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that ROFO Parties which is equal to its Overallotment Pro Rata Portion. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the proportion later of ninety (90) days of the date that the number Offer Notice is given and the date of shares initial sale of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears New Securities pursuant to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeSubsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders ROFO Parties in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series E Preferred Stock pursuant to the Purchase Agreement or pursuant to the Exchange (as defined in the Right of First Refusal and Co-Sale Agreement (as defined in the Purchase Agreement)); and (iv) the issuance of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Shares.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Root, Inc.), Investors’ Rights Agreement (Root Stockholdings, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among: (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner: (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2, 3.3 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Investor bears to the total Common Stock of the Company then outstanding (assuming (i) full conversion and/or exercise, and conversion to Common Stockas applicable, of all Preferred Stock and any other Derivative Securities then outstanding warrantsand (ii) excluding unallocated stock reserved under the Company’s equity incentive plan as then in effect). At the expiration of such 20-day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) ten-day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five (45) 90-day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to to: (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Allogene Therapeutics, Inc.), Investors' Rights Agreement (Allogene Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates, provided that in the Company proposes case of an apportionment of rights under this Subsection 4.1 by a holder of Junior Preferred Stock, such Affiliate is a Beneficial Owner of Caribou Biosciences, Inc., and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Exchange Act, of such Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as a primary issuance an “Investor” under each such agreement (“Shares”provided that any Competitor and any FOIA Party shall not be entitled to any rights as an Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the Common Stock then held by such Investor (including the shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Investor, but not including any shares of Common Stock then held by such Investor that were acquired other than upon the exercise or conversion of Derivative Securities) bears to the total number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock the Company then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock Investors (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred Stockoutstanding Derivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); or (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO.
(iiie) the issuance of securities that Participation Rights Holders holding a majority The rights of the Registrable Investors to purchase New Securities held under this Subsection 4.1 may be modified or waived by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3a Major Purchaser Majority; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), that in the event that a Participation Rights Holders actually purchases Shares in the rights to purchase New Securities under this Subsection 4.1 are waived and any transaction contemplated by this Section 2.3Investor(s) purchase New Securities, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative the Company will give notice to the Participation Rights Holders purchasing other Investors within thirty (30) days after the largest proportion issuance of New Securities. Such notice shall describe the type, price, and terms of the New Securities. Each such other Investor shall have twenty (20) days from the date notice is given to elect to purchase on similar terms and conditions in a subsequent closing up to the number of New Securities that would, if purchased by such Investor, maintain such Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 2 contracts
Samples: Investors' Rights Agreement (Intellia Therapeutics, Inc.), Investors' Rights Agreement (Intellia Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity who is not a Defaulting Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue . Each such Investor shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate, among itself and its Affiliates (provided such Affiliates are not a Competitor). Each time Defaulting Investors shall not be entitled to any of the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder rights set forth in accordance with the following provisions:this Section 4.1.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within ten (1510) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such ten (10) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During the ten five (105) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred and twenty (120) days of the date that the Offer Notice is given and the date of the initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Preferred Stock pursuant to the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Investor, maintain such Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in New Securities. The closing of such sale shall occur within sixty (60) days of the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative date notice is given to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Investors.
Appears in 2 contracts
Samples: Stockholders Agreement (Atea Pharmaceuticals, Inc.), Stockholders Agreement (Atea Pharmaceuticals, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. Each Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Personshereby granted to it, in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a competitor of the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance (as reasonably determined by the Board of Directors) or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to by the Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any competitor of the Company (as reasonably determined by the Board of Directors) or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, and 3.2 and as an Investor under this Subsection 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the ten later of one hundred and twenty (10120) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion days of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion date that the number Offer Notice is given and the date of shares initial sale of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears New Securities pursuant to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeSubsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale issuance of shares of Preferred Stock pursuant to the Company’s capital stockPurchase Agreement; or and (iii) the issuance shares of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), Common Stock issued in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Applied Therapeutics Inc.), Investors’ Rights Agreement (Applied Therapeutics Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each , among (i) itself and (ii) its Affiliates; provided that, each such Affiliate: (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to by the Board, (y) agrees to enter into this Agreement and each of the Ninth Amended and Restated Voting Agreement and the Ninth Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein (each as may be amended and/or restated from time the Company proposes to offer any additional shares oftime), or securities convertible into or exercisable for any shares ofas an “Investor” under each such agreement (provided that, any class of its capital stock for sale and issuance by the Company Competitor shall not be entitled to any rights as a primary issuance (“Shares”Major Investor, as applicable, under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly issued or indirectly, issuable upon the conversion of all outstanding shares of Preferred Stock Registrable Securities then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder Major Investor bears to the total number of shares of Common Stock issued and heldof the Company then outstanding (assuming full conversion and/or exercise, or issuable upon conversion as applicable, of all Preferred Stock then held, by all such Fully Exercising Investors who desire and other outstanding Derivative Securities). The closing of any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.
(d) Notwithstanding anything to the contrary contained herein, if a Regulated Holder exercises its right of first offer pursuant to this Subsection 4, the Company and each holder of Registrable Securities agrees to use its commercially reasonable efforts to create a security equivalent to the New Securities but incorporating substantially similar terms and limitations as set forth in the Restated Certificate applicable to the Regulatory Conversion Restriction, the Regulatory Voting Restriction and the BHCA Regulatory Restriction (as defined in the Restated Certificate) or as may otherwise be reasonably required for the holders of Series B-1 Preferred Stock to comply with the BHCA and other relevant banking laws, regulations and agency interpretations and guidance.
(e) Notwithstanding any provision hereof to the contrary, in lieu of complying with the provisions of this Subsection 4.1, the Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such New Securities. The closing of such sale shall occur within sixty (60) days of the date notice is given to the Major Investors.
(f) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); (ii) shares of Common Stock issued in the assignment by the Company of a right of first refusal that the Company may have with respect to IPO; (iii) any proposed sale issuance of shares of Preferred Stock issued pursuant to the Company’s capital stockPurchase Agreement; or (iiiiv) the any issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Non-Voting Common Stock pursuant to Section 3.4), the Common Stock Financing (as defined in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement).
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Maplebear Inc.), Investors’ Rights Agreement (Maplebear Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board and (y) agrees to enter into this Agreement and each of the Operating Agreement, the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” or “Member” as applicable under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”)Major Investor under Subsections 3.1, 3.2 and 4.1 hereof . Notwithstanding the Company shall foregoing, a Major Investor may not apportion its right of first make an offering of such Shares offer to each Participation Rights Holder in accordance with the following provisions:more than 20 Affiliates and/or Investor Beneficial Owners.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock Shares then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and Major Investor (including all shares of Common Stock issuable, Shares then issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all the Preferred Shares and any other Equity Securities then held by such Major Investor) bears to the total Common Shares then outstanding shares of Preferred Stock (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Shares and other rights to acquire Preferred StockEquity Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock Shares and any other Equity Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock Shares and any other Equity Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred and twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (45) days 30)days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8Operating Agreement) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority Series C Preferred Shares to Additional Purchasers (each as defined in the Purchase Agreement) pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in New Securities. The closing of such sale shall occur within sixty (60) days of the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative date notice is given to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Major Investors.
Appears in 2 contracts
Samples: Investors’ Rights Agreement, Investors’ Rights Agreement (Deciphera Pharmaceuticals, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among itself and its Affiliates; provided that each such Affiliate (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and the Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2, 3.3 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within thirty (1530) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Preferred Stock and any other Derivative Securities then held by all the Major Investors (including all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by all the Major Investors). At the expiration of such twenty (assuming full exercise20) day period, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (AbSci Corp), Investors’ Rights Agreement (AbSci Corp)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided, that, each such Affiliate or Investor Beneficial Owner: (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares ofby the Board of Directors, or securities convertible (y) agrees to enter into or exercisable for any shares ofthis Agreement and each of the Amended and Restated Voting Agreement and Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that, any class of its capital stock for sale and issuance by the Company Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by such Major Investor bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Preferred Stock and other Derivative Securities and not including any shares of Common Stock issuableissued after the date hereof to employees of the Company, directly or indirectly, including shares issued upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrantsstock options). At the expiration of such twenty (20) day period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Syros Pharmaceuticals, Inc.), Investors’ Rights Agreement (Syros Pharmaceuticals, Inc.)
Right of First Offer. Subject to the terms and conditions specified in this Section 2.34.1, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holderand applicable securities laws, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time event the Company proposes to offer offer, issue or sell any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”)Additional Equity Securities, the Company shall first make an offering of such Shares Additional Equity Securities to the Eligible Holders (the “Offerees”) and each Participation Rights Holder Offeree shall have a preemptive right to purchase a Pro Rata Share (as defined below) of all or any part of such Additional Equity Securities in accordance with the following provisions:provisions of this Section 4.1. Any Offeree shall be entitled to apportion the right of first offer hereby granted it among themselves and their Affiliates in such proportions as it deems appropriate.
(a) The Company shall deliver a notice by certified mail notice, in accordance with the provisions of Section 8.4 hereof (the “Offer Notice”) to the Participation Rights Holders Offerees stating (i) its bona fide intention to offer issue such SharesAdditional Equity Securities, (ii) the number of such Shares Additional Equity Securities to be offeredissued, and (iii) the price and terms, if any, upon which it proposes to offer issue such SharesAdditional Equity Securities.
(b) Within fifteen twenty (1520) calendar days after delivery the receipt of the Offer Notice, each Participation Rights Holder may Offeree may, by written notification, elect to purchase or obtain, in whole or in part, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares Additional Equity Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon Ordinary Shares (calculated on an as-converted basis assuming conversion of all outstanding shares convertible securities) then held, by such Offeree bears to the total number of Ordinary Shares (calculated on an as-converted basis assuming conversion of all convertible securities), held by all Shareholders immediately prior to the issuance of Additional Equity Securities (the “Pro Rata Share”). For avoidance of doubt, with respect to each Ordinary Shareholder holding Preferred Stock then Shares, any calculation in respect of its Pro Rata Shares shall be based on and shall be limited to the relevant Preferred Shares held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuableOrdinary Shareholder, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock without considering any Ordinary Shares held by such Ordinary Shareholder.
(assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stockc) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder Offeree that purchases elects to purchase all of the shares Pro Rata Shares available to it (each, a “Fully-Fully Exercising Holder”) of any other Participation Rights HolderOfferee’s failure to do likewise. During the ten (10) day day-period commencing immediately after receipt of such information, each Fully-Fully Exercising Holder shall be entitled to obtain that portion notify the Company of its desire to purchase more than its Pro Rata Share of the Shares Additional Equity Securities, stating the number of the Additional Equity Securities it proposes to purchase. If as a result thereof, such oversubscription exceeds the total number of the remaining Additional Equity Securities available for which Participation Rights Holders were entitled to subscribe but which were not subscribed for purchase, the oversubscribing Fully Exercising Holder will be cut back by the Participation Rights Holders Company with respect to their oversubscriptions to that is number of remaining Additional Equity Securities equal to the proportion that the number of shares Registrable Securities (calculated on an as-converted basis and exclusive of Common Stock issued and held, or issuable upon conversion of Preferred Stock the Ordinary Shares held by the Ordinary Shareholders) then held, held by such Fully-Fully Exercising Holder bears to the total number of shares Registrable Securities (calculated on an as-converted basis and exclusive of Common Stock issued and held, or issuable upon conversion of Preferred Stock the Ordinary Shares held by the Ordinary Shareholders) then held, held by all such Fully Exercising Investors Holders who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed Additional Equity Securities.
(d) If all Additional Equity Securities referred to in the Offer Notice are not elected to be purchased or obtained as provided in Section 4.1(b) and (c) The hereof, the Company may, during the forty five ninety (45) day 90)-day period following the expiration of the period provided in subsection 2.3(bSection 4.1(b) and (c) hereof, offer the remaining unsubscribed portion of the Shares such Additional Equity Securities to any person or persons identified parties at a price not less than, and upon terms no more favorable to the offeree than Offerees than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares Additional Equity Securities within such period, or if such agreement is not consummated within forty five twenty (4520) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares Additional Equity Securities shall not be offered unless first reoffered to the Participation Rights Holders Offerees in accordance herewith.
(d) The right of first offer in with this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”4.1.
Appears in 2 contracts
Samples: Shareholder Agreement (Burning Rock Biotech LTD), Shareholder Agreement (Burning Rock Biotech LTD)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Investor (“Investor Beneficial Owners”); provided, that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as a primary issuance an “Investor” under each such agreement (“Shares”provided that any Competitor or FOIA Party shall not be entitled to any rights as an Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Series A Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty one (1521) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Series A Preferred Stock and any other Derivative Securities then held by such Investor) bears to the total Common Stock of the Company held by all other Investors (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsSeries A Preferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty one (21) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During Each Fully Exercising Investor may, by giving notice to the ten (10) day period commencing after receipt Company, elect to purchase or acquire, in addition to the number of such informationshares specified above, each Fully-Exercising Holder shall be entitled up to obtain that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series A Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series A Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall apply prior to the earlier of the IPO and a Deemed Liquidation Event (as defined in the Certificate of Incorporation) and shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (89bio, Inc.), Investors’ Rights Agreement
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Personshereby granted to it, in such proportions as it deems appropriate. Each time , among (i) itself (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement as an “Investor” under each such agreement (provided that any competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IVRestated Certificate), Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) shares of Common Stock issued in the assignment by the Company of a right of first refusal that the Company may have with respect to IPO, (iii) any proposed sale issuance of shares of Preferred Stock pursuant to the Company’s capital stock; or Series B Purchase Agreement and (iiiiv) the any issuance of securities shares that Participation Rights Holders holding the holders of a majority of the Registrable Securities held by Participation Rights Holders agree then outstanding shares of Preferred Stock elect in writing to exclude be exempt from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Subsection 4.1.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Foghorn Therapeutics Inc.), Investors’ Rights Agreement (Foghorn Therapeutics Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues . A Major Holder shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares ofamong (i) itself and (ii) its Affiliates; provided, any class of its capital stock for sale and issuance by the Company that, as a primary condition precedent to any issuance (“Shares”)of such New Securities to such Affiliate, the Company shall first make an offering require any such Affiliate (x) to become a party to this Agreement by executing a counterpart signature page hereto agreeing to be bound by and subject to the terms of this Agreement as a Major Holder and (y) to become a party to the Voting Agreement and that certain Second Amended and Restated Right of First Refusal and Co-Sale Agreement, dated as of the date hereof, by and among the Company and the other parties thereto by executing a counterpart signature page thereto agreeing to be bound by and subject to the terms of such Shares to each Participation Rights Holder in accordance with the following provisions:agreements.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Holder, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, offered and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Major Holder may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Major Holder bears to the aggregate number of (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Holder) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities) and full exercise (such portion, a Major Holder’s “Pro Rata Amount”). At the expiration of all outstanding warrantssuch twenty (20) day period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Major Holder that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights Major Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Major Holders were entitled to subscribe but which that were not subscribed for by the Participation Rights Major Holders that which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days following the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), then the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of following the execution thereof, then the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Major Holders in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; ) or (ii) Common Stock issued in the assignment by IPO.
(e) Notwithstanding any provision hereof to the Company contrary, in lieu of a right of first refusal that the Company may have complying with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Holders within thirty (30) days after the issuance of any New Securities. Such notice shall describe the type, notwithstanding any price and terms of the New Securities. Each Major Holder shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Holder, maintain such Major Holder’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in New Securities. The closing of such sale shall occur within sixty (60) days following the event date that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative notice is given to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Major Holders.
Appears in 2 contracts
Samples: Investors’ Rights Agreement (Harmony Biosciences Holdings, Inc.), Investors’ Rights Agreement (Harmony Biosciences Holdings, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it. in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five sixty (4560) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series B Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 2 contracts
Samples: Investors’ Rights Agreement, Investors’ Rights Agreement (Kezar Life Sciences, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) is an Accredited Investor, and (z) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2, 3.3 and 4.1 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock, options and any other rights to acquire Preferred Stock) and full exercise Derivative Securities then outstanding). At the expiration of all outstanding warrantssuch 20 day period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) “Exempted Securities” (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing Preferred Stock to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Additional Purchasers pursuant to Section 3.4), in 1.3 of the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Samples: Investor Rights Agreement (Gryphon Online Safety, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among (i) itself and (ii) its Affiliates; provided that each such Affiliate is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering Board of such Shares to each Participation Rights Holder in accordance with the following provisions:Directors.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within By notification to the Company within fifteen (15) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Derivative Securities then held, held by such Fully-Exercising Holder Major Investor) bears to the total number of shares of Common Stock issued and heldof the Company then outstanding (assuming full conversion and/or exercise, or issuable upon conversion as applicable, of all Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire outstanding). The closing of any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Subsection 4.1(b) shall occur within the later of one hundred and twenty (120)] days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty forty-five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Excluded Issuances (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate Articles of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Preferred Stock to aadditional Investors pursuant to of the Registrable Securities held Purchase Agreement.
(e) The right of first offer set forth in this Subsection 4.1 shall terminate with respect to any Major Investor who fails to purchase, in any transaction subject to this Subsection 4.1, all of such Major Investor’s pro rata amount of the New Securities allocated (or, if less than such Major Investor’s pro rata amount is offered by Participation Rights Holders agree the Company, such lesser amount so offered) to such Major Investor pursuant to this Subsection 4.1. Following any such termination, such Investor shall no longer be deemed a “Major Investor” for any purpose of this Subsection 4.1]
(f) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage- ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Samples: Investors’ Rights Agreement (First Light Acquisition Group, Inc.)
Right of First Offer. Subject In the event that any Investor proposes to Transfer any Conversion Shares which would cause the aggregate number of Conversion Shares Transferred by such Investor (or any group of Investors acting in concert with respect to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 Transfer of Conversion Shares) to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 exceed 300,000 shares (as adjusted for on account of any stock splits, stock dividendsdividends or similar events affecting the Common Stock) after the date hereof, reclassification the selling Investor or Investors shall furnish to the Company, a notice, stating such Investor’s or Investors’ desire to make such a Transfer and the like) number of Registrable Securities and shares of Conversion Shares to be Transferred (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights HolderOffered Shares”). For purposes At any time within one (1) business day of this Section 2.3, Participation Rights Holder includes any Affiliated Persons the receipt of a Participation Rights Holder and a Participation Rights Holder who chooses notice pursuant to exercise the right preceding sentence (the “Right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“SharesFirst Offer Period”), the Company shall first make an offering have the right by delivery of such Shares a written notice to each Participation Rights Holder in accordance with the following provisions:
selling Investor (a) The Company shall deliver a notice by certified mail (the “Offer Notice”) to offer to purchase all, but not less than all, of the Participation Rights Holders stating Offered Shares. Each Offer Notice shall constitute an irrevocable offer by the Company to the Investor to purchase the Offered Shares described in the Offer Notice at the price specified in the Offer Notice. At any time in the three (3) trading day period following delivery of the Offer Notice the selling Investor may (i) its bona fide intention elect to accept the offer such Shares, pursuant to the Offer Notice by delivery of written notice to the Company or (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery sell any of the NoticeOffered Shares, each Participation Rights Holder may elect to purchase publicly or obtainprivately, at the price and on the terms specified but in the Noticecompliance with applicable securities laws, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to per share in excess of the offeree than those specified price per share provided in the Offer Notice. If For the Company does not enter into avoidance of doubt, if any proposed Transfer by an agreement for Investor (or any group of Investors acting in concert with respect to such Transfer) would result in the sale Transfer of more than an aggregate of 300,000 Conversion Shares after the date hereof (as adjusted on account of any stock splits, stock dividends or similar event affecting the Common Stock) by such Investor after the date hereof, all of the Conversion Shares within included in such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder proposed Transfer shall be deemed subject to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right this terms of first offer this Section 2.02. Notwithstanding anything contained in this Section 2.3 shall not 2.02 to the contrary, Second Exchange Shares only may be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Transferred pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder Sections 2.01 and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”2.03 hereof.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.35.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, and (y) agrees to enter into this Agreement and the Right of First Refusal, Co-Sale and Drag-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” and “Holder” under such agreement (provided that any FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 4.1 and 5.1 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within thirty (1530) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all any Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding shares of Preferred Stock (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsDerivative Securities then outstanding). At the expiration of such thirty (30) period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten thirty (1030) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock any Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock any Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 5.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 5.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 5.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 5.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty forty-five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 5.1.
(d) The right of first offer in this Section 2.3 5.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Milestone Shares (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporationas defined below); (ii) the assignment by the Company Exempted Securities; and (iii) shares of a right of first refusal that the Company may have with respect to any proposed sale of shares Common Stock issued in an Initial Offering of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Roivant Sciences Ltd.)
Right of First Offer. Subject During the initial Lease Term, Tenant shall -------------------- have the one-time right (subject, however, to the last sentence of Section 1.4.2 below) of first offer to lease that certain space on the third (3rd) floor of the Building which is currently leased by Exxon, contains approximately 12,913 rentable square feet (the "FIRST OFFER SPACE") when such space becomes available for lease as provided hereinbelow; provided, however: (i) if less than two (2) years remain in the initial Lease Term at the time of Landlord's delivery of the First Offer Notice (as defined below), Tenant shall not have such right of first offer unless Tenant has either previously exercised its extension option pursuant to the Extension Option Rider or exercises such option concurrently with Tenant's delivery of Tenant's Election Notice (as defined below); and (ii) if before such First Offer Space becomes available, at least 12,000 rentable square feet of space on the 4th or 5th floors of the Building which are currently leased by Exxon becomes available for lease, the First Offer Space shall be redefined to consist of the entire rentable area of the space on such floor which becomes so available, but only with respect to one (1) of such floors (which floor shall be the first floor on which at least 12,000 rentable square feet becomes available, unless at least 12,000 rentable square feet of space becomes available on both floors at the same time, in which case, the First Offer Space shall consist of the space located on the floor which has the least amount of space available, unless the amount of space available on both floors are approximately the same size (i.e. within 2,000 rentable square feet of each other), in which case the First Offer Space shall consist of the entire rentable area of the space which becomes so available on one (1) of such floors as shall be selected by Landlord). Tenant's right of first offer shall be upon the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 1.4. Notwithstanding anything to the contrary contained in this Section 1.4, Tenant's right of first offer contained in this Section 1.4 shall be subject and subordinate to (A) each Major Holderany leases of the First Offer Space which, as of the date of execution of this Lease, have been fully executed by Landlord and the tenants therein (the "INITIAL LEASES"), (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splitsall expansion, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect and similar rights currently provided to future sales by the Company of its Shares (as hereinafter defined), tenants in the Initial Leases and (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each renewals of the Investors described in (A)Initial Leases, (B), (C), (D) whether or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses not such renewals are pursuant to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, an express written provision in such proportions as it deems appropriate. Each time the Company proposes leases and regardless of whether any such renewals are consummated pursuant to offer any additional shares of, new leases or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance lease amendments (“Shares”)collectively, the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares"SUPERIOR RIGHTS").
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”
Appears in 1 contract
Samples: Office Lease (Homestore Com Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.33.1, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification applicable securities laws and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a any valid right of first offer with respect to future sales by the Company of its Shares (existing as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) date first set forth above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time if the Company proposes to offer or sell any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”)New Securities, the Company shall first make an offering offer such New Securities to each of the Investors then holding any Eligible Securities (the “Eligible Investors”) at least twenty (20) days prior to the issuance of the New Securities, and each Eligible Investor shall have the right to purchase its Pro Rata Share of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) New Securities. The Company shall deliver a give written notice by certified mail (“the "Offer Notice”") to each of the Participation Rights Holders Eligible Investors, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offeredoffered to each Eligible Investor, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
New Securities. By notification to the Company within ten (b10) Within fifteen (15) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder the Eligible Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion the Eligible Investor’s Pro Rata Share of such Shares which equals New Securities. In the proportion event that any Investor declines to purchase its Pro Rata Share of such New Securities, then the Company shall provide notice to any Investor exercising such right to purchase New Securities, and each such Eligible Investor shall have a right to purchase an additional number of shares New Securities based upon the Pro Rata Shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stockexercising Eligible Investors. Such purchases shall be completed at the same The closing as that of any third party purchasers or at an additional closing thereunder. The Company sale pursuant to this Subsection 3.1 shall promptly, in writing, inform each Participation Rights Holder that purchases all occur within the shares available to it later of ninety (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (4590) days of the execution thereof, date that the right provided hereunder shall be deemed Offer Notice is given and the date of initial sale of New Securities pursuant to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) Subsection 3.1. The right of first offer in this Section 2.3 Subsection 3.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Excepted Securities.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified of this Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities (other than Exempted Securities, as defined in this Section 2.3the Restated Certificate), the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue Eligible Stockholder. An Eligible Stockholder shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Personshereby granted to it, in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Eligible Stockholder (the “Eligible Stockholder Beneficial Owners”); provided that, each such Affiliate or Eligible Stockholder Beneficial Owner: (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares ofby the Board, or securities convertible (y) agrees to enter into or exercisable for any shares ofthis Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that, any class Affiliate or Eligible Stockholder Beneficial Owner that is a Competitor or FOIA Party shall not be entitled to any rights as an Eligible Stockholder or Investor under Subsections 3.1, 3.2 and 4.1 hereof); provided further that any such Affiliate or Eligible Stockholder Beneficial Owner that is, directly or indirectly, controlled by Telstra Corporation Limited shall not be deemed to be a Competitor, and (z) agrees to purchase at least such number of its capital stock for sale New Securities as are allocable hereunder to the Eligible Stockholder holding the fewest number of shares of Preferred Stock and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Eligible Stockholder, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities, (iv) the number of New Securities which the Eligible Stockholder is entitled to purchase based on the Eligible Stockholder’s Proportional Share (as defined below), (v) the date by which the Eligible Stockholder must elect to purchase or acquire the New Securities pursuant to the Offer Notice and (vi) that the Eligible Stockholder should indicate the number, if any, of New Securities in excess of its Proportional Share that it would elect to purchase if other Eligible Stockholders do not purchase their full Proportional Share.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Eligible Stockholder may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Eligible Stockholder (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable of the Preferred Stock or Derivative Securities, issuable upon the exercise or exchange of any Derivative Securities and any other capital stock then held by such Eligible Stockholder, calculated on an as-converted to Common Stock basis) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable of all outstanding shares of Preferred Stock (assuming full exerciseand Derivative Securities and any other capital stock of the Company, and conversion calculated on an as-converted to Common StockStock basis) (such Eligible Stockholder’s “Proportional Share”). At the expiration of such twenty (20) day period, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Eligible Stockholder that purchases elects to purchase or acquire all the shares available to it and that specified a desire to purchase additional New Securities beyond such Eligible Stockholder’s Proportional Share (each, a an “Fully-Exercising HolderAccepting Eligible Stockholder”) of any other Participation Rights HolderEligible Stockholder’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Exercising Holder shall be entitled Accepting Eligible Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to such Eligible Stockholder’s Proportional Share, up to that portion of the Shares New Securities for which Participation Rights Holders Eligible Stockholders were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Eligible Stockholders which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such FullyAccepting Eligible Investor (calculated on an as-Exercising Holder converted to Common Stock basis) bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Accepting Eligible Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares (calculated on an as-converted to Common Stock basis). The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Eligible Stockholders in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended Restated Certificate); and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), Common Stock issued in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative Initial Offering.
(e) Notwithstanding anything to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoingcontrary contained herein, the if a Regulated Holder exercises its right of first offer pursuant to this Subsection 4.1, the Company and each holder of Registrable Securities agrees to use its commercially reasonable efforts to create a security equivalent to the New Securities but incorporating substantially similar terms and limitations as set forth in the Restated Certificate applicable to the Regulatory Conversion Restriction, the Regulatory Voting Restriction and the BHCA Regulatory Restriction (as defined in the Restated Certificate) or as may otherwise be reasonably required for the holders of Series D-1 Preferred Stock and Series E-1 Preferred Stock to comply with the BHCA and other relevant banking laws, regulations and agency interpretations and guidance.
(f) Notwithstanding anything to the contrary contained herein, if Goldman exercises its right of first offer pursuant to this Subsection 4.1, and as a result of such exercise would own voting securities of the Company representing greater than 24.9% of the outstanding voting control of the Company, then the Company and each holder of Registrable Securities agrees that a number of New Securities necessary for Goldman to not own capital stock of the Company representing greater than 24.9% of the voting control of the Company shall be recharacterized as non-voting securities and the Company and each holder of Registrable Securities agrees to use it commercially reasonable efforts to create a security equivalent to the New Securities that is a non-voting security to give effect to this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”4.1(f).
Appears in 1 contract
Samples: Investor Rights Agreement (BigCommerce Holdings, Inc.)
Right of First Offer. Subject A Member (the “Offeror”) desiring to sell all or any portion of its Units (the terms and conditions specified “Offered Units”) in this a Transfer not described in Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered 11.2.1.1 hereof shall give written notice to Cisco that (the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Offer Notice”) to the Participation Rights Holders stating Company and to the other Members (ithe “NonOfferors”) of its bona fide intention desire to sell the Offered Units, and shall attach to such Offer Notice a photocopy of a written offer of a prospective purchaser of the Offered Units containing all material terms of the proposed sale, including the identity of the purchaser, the purchase price (both in the aggregate and per Unit), and the terms of payment, and the Offeror shall certify that the offer is genuine and in all respects what it purports to be.
11.3.1 An Offer Notice shall not be effective, and the Offeror giving such Sharesa notice shall not be permitted to effect a Transfer of the Offered Units pursuant to this Section 11.3, (ii) unless:
11.3.1.1 The offer is to sell to a principal identified therein, or an agent acting on behalf of a disclosed principal, but not an agent acting on behalf of an undisclosed principal, such principal is not an Affiliate of the number Offeror, and any affiliation of such Shares to principal with the Offeror is fully disclosed in the Offer Notice; and
11.3.1.2 The Offeror shall not be offered, and (iii) in default under this Agreement at the time of closing in any manner which is not cured simultaneously with closing;
11.3.1.3 The purchase price and terms, if any, upon which it proposes to offer such Sharesspecified in the Offer Notice shall be payable solely in cash at the closing of the transaction or in installments over time.
(b) Within fifteen (15) calendar days after delivery of 11.3.2 The Offer Notice shall constitute an offer by the NoticeOfferor to sell the Offered Units to the Company or the NonOfferors as hereinafter provided. First, each Participation Rights Holder the Company may elect to purchase all or obtainany portion of the Offered Interest, at the price per Unit and on the terms specified in the Notice, up to that portion Offer Notice by delivering written notice of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears election to the aggregate number of shares of Common Stock then outstanding Offeror and all shares of Common Stock issuablethe NonOfferors as soon as practical, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at but in any event within 10 Business Days after the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion delivery of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Offer Notice. If the Company does has not enter into an agreement for the sale elected to purchase all of the Shares Offered Units within such period, or if each NonOfferor may elect to purchase its Pro Rata Share of the portion of the Offered Units that the Company has not elected to purchase, at the price per Unit and on the terms specified in the Offer Notice by delivering written notice of such determination to the Offeror as soon as practical, but in any event within 25 Business Days after delivery of the Offer Notice. To the extent that the NonOfferors have failed to elect to purchase all of the Offered Units that the Company has not elected to purchase by the end of such period, the NonOfferors who elected to purchase their Pro Rata Share may elect to reach a unanimous agreement amongst themselves as to the purchase and allocation of the remaining portion of the Offered Units, by delivering written notice of such agreement is not consummated within forty five 5 Business Days after the expiration of such 25-Business Day period. If the Company and/or the NonOfferors elect (45or otherwise agree) days to purchase all of the execution thereofOffered Units from the Offeror pursuant to this Section 11.3, the right provided hereunder Transfer of the Offered Units to such Person(s) shall be deemed consummated as soon as practical after the delivery of the election notices (and agreement, if applicable), but in any event within 10 Business Days after the expiration of the 30-Business Day election periods.
11.3.3 If the Company and/or the NonOfferors have not elected (or otherwise agreed) to be revived and such Shares shall not be offered unless first reoffered purchase all of the Offered Units as provided in Section 11.3.2 hereof, any purported acceptance of the Offer with respect to the Participation Rights Holders Offered Units shall be void, and the Offeror may, within 30 Business Days after the expiration of the election periods specified in accordance herewith.
(d) The right Section 11.3.2 hereof, Transfer the Offered Units to the prospective purchaser at the price and on the other terms and conditions set forth in the Offer Notice; provided however, that in all events the requirements of first offer Section 11.2.2 hereof must be satisfied. If the Offeror does not transfer the Offered Units on such basis and within such time period, the Offeror may not Transfer the Offered Units pursuant to this Section 11.3 until and unless it has again followed the procedures set forth in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions 11.3.
11.3.4 For purposes of this Section 2.3; provided11.3, however, notwithstanding any such waiver (or waiver each of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders NonOfferor’s “Pro Rata Share” shall be permitted to participate on a pro rata basis relative equal to the Participation Rights Holders purchasing ratio derived by dividing the largest proportion Member’s Units by the aggregate number of such Participation Rights Holder’s pro rata share. In addition to Units then owned by the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”NonOfferors.
Appears in 1 contract
Samples: Operating Agreement (iPCS, INC)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Fourth Amended and Restated Voting Agreement and Fourth Amended and Restated Right of First Refusal and Co-Sale Agreement, each, of even date herewith and among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Derivative Securities then held, held by such Fully-Exercising Holder Major Investor) bears to the total number of shares of Common Stock issued and heldof the Company then outstanding (assuming full conversion and/or exercise, or issuable upon conversion as applicable, of all Preferred Stock then held, by all such Fully Exercising Investors who desire and other Derivative Securities). The closing of any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series F Preferred Stock to Additional Purchasers (as defined in the Purchase Agreement) pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in New Securities. The closing of such sale shall occur within sixty (60) days of the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative date notice is given to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Major Investors.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Personshereby granted to it, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of among itself and its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Affiliates.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares which New Securities that equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Derivative Securities then held, held by such Fully-Exercising Holder Major Investor) bears to the total number of shares of Common Stock issued and heldof the Company then outstanding (assuming full conversion and/or exercise, or issuable upon conversion as applicable, of all Preferred Stock and other Derivative Securities then held, by all such Fully Exercising Investors who desire outstanding). The closing of any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) shares of Common Stock issued in the assignment IPO; (iii) shares issued in connection with acquisitions made by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or and (iiiiv) the issuance of securities that Participation Rights Holders holding a majority shares of Series C Preferred Stock to Additional Purchasers pursuant to Section 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; provided4.1, howeverthe Company may elect to give notice to the Major Investors within 30 days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have 20 days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Section 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in New Securities. The closing of such sale shall occur within 60 days of the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative date notice is given to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Major Investors.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.37 and applicable securities laws, if the Company and / or Parent (or any of its Affiliates) (collectively, the Company hereby grants “Issuer”) proposes to offer or sell any New Securities (other than pursuant to an Exempt Issuance), the participation rights set forth in this Section 2.3 Issuer shall first offer such New Securities to each Major Holder.
(Ai) The Issuer shall give notice (the “Offer Notice”) to each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(bii) Within fifteen (15) calendar By notification to the Issuer within 10 days after delivery of the NoticeOffer Notice is given, each Participation Rights Major Holder may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, that such Major Holder would be entitled to receive upon conversion of all outstanding shares Notes at such time of Preferred Stock the issuance of New Securities pursuant to the terms of the Note then held by such Participation Rights Major Holder bears to divided by the aggregate number total equity of shares of Common Stock the Issuer then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full conversion and / or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsequity interests, options including any profits interests, convertible debt and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stockconvertible securities then outstanding. Such purchases shall be completed at the same The closing as that of any third party purchasers or at an additional closing thereunder. The Company sale pursuant to this Section 7(a) shall promptly, in writing, inform each Participation Rights Holder that purchases all occur within the shares available to it (each, a “Fully-Exercising Holder”) later of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion 90 days of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion date that the number Offer Notice is given and the date of shares initial sale of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeNew Securities.
(ciii) The Company If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in this Section 7(a), the Issuer may, during the forty five (45) 90-day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 7(a)(ii), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company Issuer does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 7(a).
(div) The right of first offer in this Section 2.3 7(a) shall not be applicable to to: (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporationissued in an Exempt Issuance; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion shares of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate Common Stock issued in any other securities issuance”an IPO.
Appears in 1 contract
Samples: Convertible Promissory Note (Greenlane Holdings, Inc.)
Right of First Offer. (a) Subject to the terms and conditions specified in this Section 2.3, if the Company hereby grants the participation rights set forth proposes to issue Additional Shares of Common Stock (as defined in this Section 2.3 to (A4(d)(i)(B)(4) each Major Holder, of Division (B) Cisco Systems so long of Article IV of the Company’s Amended and Restated Certificate of Incorporation (as (i) Cisco continues to hold may be amended, the “Restated Charter”)), other than as currently contemplated in the Purchase Agreement, it shall in any case provide each Major Investor, and each Series E-1 Holder who holds at least 180,729 500,000 shares of Registrable Securities (as adjusted for stock splits, stock dividends, reclassification combinations and the likeother recapitalizations) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined)each, (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a an “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“SharesOfferee”), with a written notice (the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Issuance Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such SharesAdditional Shares of Common Stock, (ii) the number of such Additional Shares of Common Stock to be offered, and (iii) the price and terms, if any, terms upon which it proposes to offer such Shares.
Additional Shares of Common Stock. By written notification received by the Company (b) Within an “Election Notice”), within fifteen (15) calendar days after delivery receipt of the Issuance Notice, each Participation Rights Holder Offeree may elect to purchase or obtain, at the price and on the terms specified in the Issuance Notice, up to that portion of such Additional Shares which of Common Stock (such holder’s “Pro-Rata Portion”) that equals the proportion that the number of shares of Registrable Securities then held by such Offeree bears to the total number of shares of Common Stock issuable, directly or indirectly, of the Company then outstanding (including the Common Stock issuable upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectlyStock, upon conversion of all other outstanding shares of Preferred Stock (assuming full exerciseconvertible securities, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full upon exercise of all outstanding warrantsoptions (and assuming conversion of convertible securities issuable upon exercise of options)). Additionally, options in connection with any such issuance, within fifteen (15) calendar days after receipt of the Issuance Notice, each of the General Atlantic Stockholders and other rights TPG Stockholders may elect to acquire purchase or obtain, at the price and on the terms specified in the Issuance Notice, the number of shares of Additional Common StockStock proposed to be sold by the Company in such issuance (the “Additional GA/TPG Shares”) equal to the total number of Additional Shares of Common Stock proposed to be sold by the Company in such offering less the number of shares equal to the aggregate Pro Rata Portion of the Additional Shares of Common Stock that all Offerees are entitled to purchase pursuant to this Section 2.3(a) in connection with such offering. Such purchases Any election to purchase such Additional GA/TPG Shares shall be completed at allocated among the same closing electing General Atlantic Stockholders and TPG Stockholders on a pro rata basis, in each case, based on the aggregate amount of Registrable Securities then held by such electing holder as compared to the aggregate amount of Registrable Securities then held by all such electing holders.
(b) In the event that (i) an Offeree fails to give an Election Notice within the prescribed period, or otherwise fails to purchase its Pro-Rata Portion of any third party purchasers or at an additional closing thereunder. The such Additional Shares of Common Stock (not including, in the case of the General Atlantic Stockholders and TPG Stockholders, the Additional GA/TPG Shares), the Company shall promptly, promptly inform in writing, inform writing each Participation Rights Holder Offeree that purchases all the shares available has elected to it purchase its full Pro-Rata Portion (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderOfferee’s failure to do likewiseso. During the ten (10) day period commencing after receipt the delivery of such informationsupplemental notice, each Fully-Fully Exercising Holder Investor shall be entitled to obtain that its pro-rata portion of the remaining Additional Shares for which Participation Rights Holders were entitled to subscribe but which were of Common Stock not subscribed for purchased by the Participation Rights Holders that is other Offerees (such right does not include the right to purchase a Pro Rata Portion of the Additional GA/TPG Shares not purchased by the General Atlantic Stockholders or TPG Stockholders). For the purposes of this Section 2.3, a Fully Exercising Investor’s pro rata portion shall equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Registrable Securities then held, held by such Fully-a Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Registrable Securities then held, held by all such Fully Exercising Investors. If not all Fully Exercising Investors choose to purchase all the shares available to them, the other Fully Exercising Investors shall be offered those shares on a similar pro rata basis based upon the ownership of Registrable Securities of all Fully Exercising Investors who desire continue to wish to purchase additional shares, until all of the shares not purchased by Offerees (other than the Additional GA/TPG Shares for which Participation Rights Holders did not subscribeshall only be available to be purchased by the General Atlantic Stockholders and TPG Stockholders) have been allocated to Offerees or all Offerees no longer wish to purchase additional shares. An Offeree shall be entitled to apportion the right of first offer hereby granted it among itself and its partners, members and affiliates in such proportions as it deems appropriate.
(c) The If all Additional Shares of Common Stock that Offerees and/or the General Atlantic Stockholders and/or the TPG Stockholders, as the case may be, are entitled to purchase or obtain pursuant to Sections 2.3(a) and (b) are not elected to be purchased or obtained as provided in Sections 2.3(a) and (b) hereof, the Company may, during the forty five one hundred twenty (45120) day period following the expiration of the period provided in subsection 2.3(bSections 2.3(a) and (b) hereof, as the case may be, offer the remaining unsubscribed portion of the such Additional Shares of Common Stock to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Issuance Notice. If the Company does not enter into an agreement for the sale of the Additional Shares of Common Stock within such period, or if such agreement is not consummated within forty five one hundred twenty (45120) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Additional Shares of Common Stock shall not be offered unless first reoffered to the Participation Rights Holders Offerees in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) Shares of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), Common Stock in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the Restated Certificate.
(e) The right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and Offeree with regard to any particular subsequent securities issuanceissue of Additional Shares of Common Stock, if (i) at the time of such subsequent securities issuanceissue of Additional Shares of Common Stock, the Participation Rights Holder such Offeree is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance issue of Additional Shares of Common Stock is otherwise being offered only to accredited investors; provided.
(f) The Company will not grant any right of first offer to any subsequent purchasers of the Company’s equity securities other than by having them become parties hereto in accordance with the amendment provisions hereof.
(g) The rights of first refusal of each Offeree under this Section 2 may be assigned to the same parties, subject to the same restrictions as any transfer of registration rights pursuant to Section 1.11.
(h) In the event that notwithstanding the foregoing Right of First Offer in this Section 2.3 is waived pursuant to Section 3.7 hereof with respect to an issuance of Additional Shares of Common Stock by the exclusion Company, and any Offeree that consented to such waiver pursuant to Section 3.7 purchases any Additional Shares of Common Stock sold in such offering (a “Waiving Investor”), each Offeree that is not a Waiving Investor shall be entitled to purchase its Adjusted Pro-Rata Share of the Additional Shares of Common Stock sold in such offering upon the terms and conditions set forth in Sections 2.3(a) and 2.3(b). For purposes of this Section 2.3(h), an Offeree’s “Adjusted Pro-Rata Share” of the Additional Shares of Common Stock subject to the waiver described herein shall be equal to (i) such Offeree’s Pro-Rata Portion of the Additional Shares of Common Stock sold in such offering multiplied by (ii) the highest percentage (up to 100%) of any Participation Rights Waiving Investor’s Pro-Rata Portion that such Waiving Investor from any purchases in such offering. For example, if only one Waiving Investor purchases Additional Shares of Common Stock in such offering and it purchases 50% of its Pro-Rata Portion in such offering, each Offeree’s Adjusted Pro-Rata Share shall be equal to 50% of its Pro-Rata Portion. For another example, if one Waiving Investor purchases 60% of its Pro-Rata Portion in such offering and another Waiving Investor purchases 110% of its Pro-Rata Portion in such offering, each Offeree’s Adjusted Pro-Rata Share shall be equal to 100% of its Pro-Rata Portion.
(i) Notwithstanding the foregoing, to the extent such Offeree is a Company Covered Person or will become a Company Covered Person as a result of a particular securities issuance shall acquisition of Additional Shares of Common Stock or Additional GA/TPG Shares contemplated hereby, such Offeree will not affect the have a right of first offer under this Section 2.3 with respect to the offering of such Participation Rights Investor Additional Shares of Common Stock or Additional GA/TPG Shares if, and for so long as, the Offeree, any of its directors, executive officers, general partners or managing members or any person that would be deemed a beneficial owner of the securities of the Company held by the Offeree (in accordance with Rule 506(d) of the Act) is subject to any “bad actor” disqualification described in Rule 506(d)(1)(i) through (viii) under the Act (a “Bad Actor Disqualification”), except as set forth in Rule 506(d)(2) or (d)(3) under the Act. Each party to this Agreement will promptly notify each other party to this Agreement in writing if it or, to its knowledge, any person specified in Rule 506(d)(1) under the Act becomes subject to any Bad Actor Disqualification. To the extent any Offeree is prohibited from participating in an offering pursuant to this Section 2.3(i), such Offeree will still be permitted to assign its rights to participate in such offering to any other securities issuance”affiliate of such Offeree that is not subject to a Bad Actor Disqualification. For purposes of this Section 2.3(i), a “Company Covered Person” means, with respect to the Company as an “issuer” for purposes of Rule 506 promulgated under the Securities Act, any person or entity listed in the first paragraph of Rule 506(d)(1).
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the The Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination Investor a right --- -------------------- of first offer with respect to future sales by the Company of its Shares New Securities (as hereinafter defined), (C) each X. Xxxx Price . Each Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right hereby granted among itself or and its Affiliated Personspartners, stockholders and affiliates in such proportions as it deems appropriate. Each time Issuances of securities of any subsidiary of the Company are not subject to this right.
(a) In the event the Company proposes to issue New Securities, except in connection with the offer and sale of the Series F Preferred Stock, which notice is hereby waived, it shall give each Investor written notice (the "Notice") of its intention stating (i) a description of the New Securities it proposes to issue, (ii) the number of shares of New Securities it proposes to offer, (iii) the price per share at which, and other terms on which, it proposes to offer such New Securities and (iv) the number of shares that the Investor has the right to purchase under this Section 3.1, based on the Investor's Percentage (as defined below).
(b) Within fifteen (15) days after the Notice is given (in accordance with Section 5.6), each Investor may elect to purchase, at the price and on the terms specified in the Notice, up to the number of shares of the New Securities proposed to be issued that the Investor has the right to purchase as specified in the Notice. An election to purchase shall be made in writing and must be given to the Company within such 15-day period (in accordance with Section 5.6). The closing of the sale of New Securities by the Company to the participating Investors upon exercise of its rights under this Section 3.1 shall take place simultaneously with the closing of the sale of New Securities to third parties.
(c) The Company shall have ninety (90) days after the last date on which the Investors' right of first offer under this Section 3.1 lapsed to enter into an agreement (pursuant to which the sale of New Securities covered thereby shall be closed, if at all, within forty-five (45) days from the execution thereof) to sell the New Securities which the Investors did not elect to purchase under this Section 3.1, at or above the price and upon terms not more favorable to the purchasers of such securities than the terms specified in the initial Notice given in connection with such sale. In the event the Company has not entered into an agreement to sell the New Securities within such ninety (90) day period (or sold and issued New Securities in accordance with the foregoing within forty-five (45) days from the date of said agreement), the Company shall not thereafter issue or sell any additional New Securities without first offering such New Securities to the Investors in the manner provided in this Section 3.1.
(d) (i) "New Securities" shall mean any shares of, or securities convertible into or exercisable for any shares of, any class of its the Company's capital stock for sale stock; provided that "New Securities" does not include: (A) shares of the Company's Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock, Series E Preferred Stock and issuance Series F Preferred Stock, to be issued concurrently with or within sixty (60) days after the execution of this Agreement, or the Common Stock issuable upon conversion of any such Preferred Stock; (B) securities issued pursuant to the Board approved acquisition of another business entity by the Company as a primary issuance (“Shares”)by merger, purchase of substantially all of the assets of such entity, or other reorganization whereby the Company shall first make an offering owns at least a majority of the voting power of such Shares to each Participation Rights Holder in accordance with the following provisions:
entity; (aC) The Company shall deliver a notice by certified mail (“Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion outstanding as of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of date hereof (other than any shares of Common Stock issued to Xxxxxxx Xxxxx, Xxxx Xxxxxxx, Xxxxxxx Xxxx and heldLi An pursuant to Restricted Stock Purchase Agreements dated March 30, 1996 and February 10, 1996, that have been repurchased by the Company), (D) shares of Common Stock and/or options to purchase Common Stock issued pursuant to any arrangement approved by the Board of Directors to employees, officers and directors of, or consultants of the Company or any subsidiary; (E) Common Stock issuable upon conversion exercise of Preferred Stock then held, by all such Fully Exercising Investors who desire any options excluded pursuant to purchase Shares for which Participation Rights Holders did not subscribe.
subsection (c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8D) of the Company’s Amended and Restated Certificate of Incorporation; this paragraph, (iiF) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock's Common Stock or Preferred Stock of any series issued in connection with any stock split, stock dividend or recapitalization of the Company; (G) Common Stock issued upon exercise of warrants, options or (iii) convertible securities if the issuance of such warrants, options or convertible securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing was subject to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in granted under this Section 2.3 shall not be applicable 3.1; (H) capital stock or warrants or options for the purchase of shares of capital stock issued by the Company to financial institutions or lessors in connection with respect the extension of credit to the Company or the purchase financing of personal property by the Company; (I) securities issued in any Participation Rights Holder and any particular subsequent securities issuance, if public offering; (iJ) at shares of the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined Company's Common Stock or Preferred Stock issued in Rule 501(a) under the Securities Act, connection with strategic corporate partnerships or joint ventures; and (iiK) such subsequent securities issuance is otherwise being offered only 189,080 shares of Common Stock issued to accredited investors; provideda former employee on January 26, that notwithstanding 2000 in settlement of a dispute with the foregoing Company related to his claimed equity ownership in the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Company.
Appears in 1 contract
Right of First Offer. (A) Subject to the terms and conditions specified in of this Section 2.36.20 and applicable securities laws, if KiOR proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to Purchaser if it beneficially owns ten percent (A10%) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors or more of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each sum of the Investors described in (A), (B), (C), (D) Shares originally issued to Purchaser at the First Closing and any Shares to be purchased by Purchaser at the Second Closing as of the time of such offer or (E) above, a “Participation Rights Holder”)sale. For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses Purchaser shall be entitled to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes to offer any additional shares ofExchange Act, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Purchaser.
(aB) The Company KiOR shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders Purchaser, stating (i1) its bona fide intention to offer such SharesNew Securities, (ii2) the number of such Shares New Securities to be offered, and (iii3) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(bC) Within fifteen By notification to KiOR within (15I) calendar seven (7) days in the case of any New Securities comprised of equity securities, and (II) seventeen (17) days in the case of any New Securities comprised of debt securities, after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Purchaser may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that its Pro Rata portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeNew Securities.
(cD) The If Purchaser fails to exercise fully the rights set forth in Section 6.20 within the periods described in clause iii above, the Company may, during will be free to complete the forty five proposed issuance or sale of the New Securities described in the Offer Notice with respect to which Purchaser failed to exercise the option set forth in this Section 6.20 on terms no less favorable to the Company than those set forth in the Offer Notice (45except that the amount of securities to be issued or sold by the Company may be reduced); provided that (x) day period following such issuance or sale is closed within one hundred twenty (120) days after the expiration of the applicable period provided in subsection 2.3(bclauses ii and iii above and (y) hereof, offer the remaining unsubscribed portion of price at which the Shares New Securities are issued or sold must be equal to any person or persons at a higher than the purchase price not less than, and upon terms no more favorable described in the Offer Notice. Such periods within which such issuance or sale must be closed will be extended to the offeree than those specified extent necessary to obtain required approvals of Governmental Authorities and other required approvals and the Company will use its commercially reasonable efforts to obtain such approvals. In the event that the Company has not sold such New Securities within such one hundred twenty (120) day period, the Company will not thereafter issue or sell any New Securities, without first again offering such securities to Purchaser in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right manner provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”6.20.
Appears in 1 contract
Samples: Purchase Agreement (Kior Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues . A Major Holder shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of among itself and its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Affiliates.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Holder, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Major Holder may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Major Holder bears to the aggregate number of (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Derivative Securities then held, held by such Fully-Exercising Holder Major Holder) bears to the total number of shares of Common Stock issued and heldof the Company then outstanding (assuming full conversion and/or exercise, or issuable upon conversion as applicable, of all Preferred Stock then held, by all such Fully Exercising Investors who desire and other Derivative Securities). The closing of any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Major Holders in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing Series B Preferred Stock to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver Additional Purchasers (or waiver of such provisions pursuant to Section 3.4), as defined in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement).
Appears in 1 contract
Samples: Investors’ Rights Agreement (C4 Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Personshereby granted to it, in such proportions as it deems appropriate. Each time , among itself and its Affiliates; provided that each such Affiliate (x) agrees to enter into this Agreement and each of (i) the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class Voting Agreement of its capital stock for sale even date herewith by and issuance by among the Company as a primary issuance (“Shares”)Company, the Company shall first make Investors and the other parties named therein and (ii) the Right of First Refusal and Co-Sale Agreement of even date herewith by and among the Company, the Investors and the other parties named therein, as an offering “Investor” under each such agreement and (y) agrees to purchase at least such number of such Shares New Securities as are allocable hereunder to each Participation Rights Holder in accordance with the following provisions:Major Investor holding the fewest number of shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the shares of Common Stock issuable upon the conversion of the Preferred Stock then held by such Major Investor bears to the total number of shares of Common Stock issuable, directly or indirectly, issuable upon the conversion of all outstanding shares of Preferred Stock of the Company then held by outstanding. At the expiration of such Participation Rights Holder bears to twenty (20) day period, the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and ROFR Agreement as an “Investor” under each such agreement (provided that any Competitor shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred and twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five one hundred twenty (45120) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five sixty (4560) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series B Preferred Stock pursuant to the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in New Securities. The closing of such sale shall occur within sixty (60) days of the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative date notice is given to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Major Investors.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Black Diamond Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement among the Company, the Investors and the other parties named therein, as a primary issuance an “Investor” under each such agreement (“Shares”provided that any Competitor or FOIA Party shall not be entitled to any rights under Section 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Series A Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (“Notice”the Offer Notice ) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Series A Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsSeries A Preferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights Holder’s Major Investor s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series A Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series A Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) shares of Common Stock issued in the issuance of securities excluded from the definition of “Additional Stock” under Article IVIPO, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company issuance of a right of first refusal that the Company may have with respect stock options or other equity compensation to any proposed sale of shares directors or employees of the Company’s capital stock; or , (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series A Preferred Stock to Additional Purchasers pursuant to Section 1.3 of the Registrable Securities held Purchase Agreement and (iv) the issuance of up to $1,000,000 shares of Common Stock by Participation Rights Holders agree the Company so long as the Company sells such shares at a price of at least $0.75 per share (as adjusted for any stock combination, stock split, stock dividend, recapitalization or other similar transaction).
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; provided4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor s percentage-ownership position, calculated as set forth in Section 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Samples: Investors Rights Agreement (Tesseract Collective, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates, (iii) in the Company proposes case of [***] and (iv) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar days By notification to the Company within [***] after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor but excluding any Common Stock issued upon conversion of all outstanding shares of the Series B Preferred Stock pursuant to the “Special Mandatory Conversion” provisions of the Certificate of Incorporation) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such [***] period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day [***] period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held by such Fully Exercising Investor (excluding any Common Stock issued upon conversion of the Series B Preferred Stock then held, by such Fully-Exercising Holder pursuant to the “Special Mandatory Conversion” provisions of the Certificate of Incorporation) bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of [***] of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five (45) day [***] period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) days [***] of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or (iii) the issuance of securities that Participation Rights Holders holding a majority Series B Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from Purchase Agreement; and (iv) the provisions issuance of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), Series B Preferred Stock in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if Milestone Closing (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement).
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so So long as (i) Cisco continues to hold a Stockholder is a holder of at least 180,729 50,000 shares of Common Stock (as adjusted presently constituted and subject to subsequent adjustments for stock splits, stock dividends, reclassification reverse stock splits, and the like) ), or at least 50,000 shares Series C Stock, Series D Preferred Stock or Series E Preferred Stock convertible into shares of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares Common Stock, or any combination thereof (as hereinafter defined), (C) each X. Xxxx Price Investor presently constituted and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue subject to hold in the aggregate at least 700,000 shares (as adjusted subsequent adjustments for stock splits, stock dividends, reclassification reverse stock splits, and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses such Stockholder shall be entitled to exercise the following right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisionsoffer:
(a) The Company Except in the case of Excluded Securities, the Corporation shall deliver a notice by certified mail (“Notice”) not issue, sell or exchange, agree to the Participation Rights Holders stating issue, sell or exchange, or reserve or set aside for issuance, sale or exchange, (i) its bona fide intention to offer such Sharesany shares of Common Stock, (ii) any other equity security of the number of such Shares to be offeredCorporation, and (iii) any debt security of the Corporation which by its terms is convertible into or exchangeable for, with or without consideration, any equity security of the Corporation, or (iv) any option, warrant or other right to subscribe for, purchase or otherwise acquire any equity security of the Corporation (collectively, the "Equity Securities"), unless in each case the Corporation shall have first offered to sell to such Stockholder the Equity Securities, at a price and termson such other terms as shall -11- 63 have been specified by the Corporation in writing delivered to the Stockholder (the "Offer"), if any, upon which it proposes to offer Offer by its terms shall remain open and irrevocable for a period of thirty (30) days from the date the Offer is received by such SharesStockholder.
(b) Within fifteen (15) calendar days after delivery Each such Stockholder shall have the right to purchase up to its pro rata share of the NoticeEquity Securities. As used in this Section 3, each Participation Rights Holder may elect to purchase or obtain, at such Stockholder's "pro rata share" shall be that amount of the price and on the terms specified Equity Securities which would result in the NoticeStockholder's owning the same percentage of the Corporation's issued and outstanding Common Stock after the issuance of Equity Securities as the Stockholder owned immediately prior to the issuance (assuming in each case the issuance of all shares issuable upon the conversion or exercise, up to that portion as the case may be, of such Shares which equals (i) the proportion that the number of shares of Common Stock issuableSeries A Preferred Stock, directly or indirectlySeries C Stock, upon conversion of all outstanding shares of Series D Preferred Stock then and Series E Preferred Stock held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuableStockholder, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exerciseif any, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock(ii) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeEquity Securities).
(c) The Company mayNotice of a Stockholder's intention to accept, during in whole or in part, an Offer shall be evidenced by a writing signed by such Stockholder and delivered to the forty five (45) Corporation at or prior to the end of the 30-day period following commencing with the expiration date the Offer is received by such Stockholder (or, if later, within 10 days after the giving of any written notice of a material change in such Offer), setting forth such portion (specifying number of shares, principal amount or the like) of the period provided in subsection 2.3(b) hereof, offer Equity Securities as such Stockholder elects to purchase (the remaining unsubscribed portion "Notice of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewithAcceptance").
(d) The right Corporation shall have 90 days from the expiration of first offer the foregoing 30-day period to sell all or any part of such Equity Securities as to which a Notice of Acceptance has not been given by the Stockholders (the "Remaining Securities") to any other Person or Persons, but only upon terms and conditions in this all material respects, including without limitation, unit price and interest rates (but excluding payment of legal fees of counsel of the purchaser), which are no more favorable, in the aggregate, to such other Person or Persons or less favorable to Corporation than those set forth in the Offer. Upon the closing of the sale to such other Person or Persons of all the Remaining Securities, which shall include payment of the purchase price to the Corporation in accordance with the terms of the Offer, if a Stockholder has timely submitted a Notice of Acceptance, it shall purchase from the Corporation, and the Corporation shall sell to such Stockholder, the Equity Securities in respect of which a Notice of Acceptance was delivered to the Corporation by the Stockholder at the terms specified in the Offer. The purchase by a Stockholder of any Equity Securities is subject in all cases to the preparation, execution and delivery by the Corporation and such Stockholder of a purchase agreement and other customary documentation relating to such Equity Securities as is satisfactory in form and substance to such Stockholder and its counsel.
(e) In each case, any Equity Securities not purchased by eligible Stockholders or by a Person or Persons in accordance with Section 2.3 shall 3(d) may not be applicable to be
(if) The Corporation agrees that on or before the issuance to any Person of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment any Equity Securities not purchased by the Company of a right of first refusal that the Company may have with respect Stockholders, it shall cause such Person to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude be bound by the obligations imposed upon Stockholders under this Agreement as if such Person were originally a signatory to this Agreement.
(g) The rights of the eligible Stockholders under this Section 3 shall not apply to the following securities (the "Excluded Securities"):
(i) up to 8,250,000 shares (or such higher number of shares as may be approved from time to time by (w) a majority in interest of the outstanding voting stock of the Corporation, (x) a majority in interest of the Series C Stock voting separately as a single class, (y) 66 2/3 in interest of the Series D Preferred Stock voting separately as a single class and (z) 66 2/3 in interest of the Series E Preferred Stock voting separately as a single class) of Common Stock or options to purchase shares of Common Stock, issued or to be issued to officers, employees or directors of, or consultants to, the Corporation, pursuant to any agreement, plan or arrangement approved by the Board of Directors of the Corporation and the Stockholders;
(ii) Common Stock issued as a stock dividend or upon any stock split or other subdivision or combination of shares of Common Stock;
(iii) Common Stock issued upon conversion of any shares of Preferred Stock;
(iv) any securities issued for consideration other than cash pursuant to a merger, consolidation, acquisition or similar business combination;
(v) Common Stock issued or to be issued by the Corporation pursuant to equipment lease financing with equipment lessors, or Common Stock reissued after the repurchase thereof by the Corporation as a result of any termination of a restricted stock purchase agreement or other employee equity plan or arrangement to which the Corporation is a party, which are approved by the Board of Directors;
(vi) Common Stock issued pursuant to transactions or agreements which have been approved by (w) a majority in interest of the outstanding voting stock of the Corporation, (x) a majority in interest of the Series C Stock voting separately as a single class, (y) 66 2/3 in interest of the
(vii) warrants to purchase up to 22,500 shares of Class A Common Stock (and the Common Stock issuable upon exercise thereof).
(h) Notwithstanding the foregoing provisions of this Section 3, the rights of the Stockholders and the obligations of the Corporation under this Section 3 shall be inapplicable to a Designated Offering and the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver 3 shall terminate upon the consummation of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Designated Offering.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself and (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board, (y) agrees to enter into this Agreement and each of the Amended and Restated Voting Agreement (the “Voting Agreement”) and Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1 and 3.2 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities then outstanding). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, held by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, held by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation; ) and (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Preferred Stock to the Investors pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Samples: Investors’ Rights Agreement (TScan Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) is an Accredited Investor, and (z) agrees to enter into this Agreement and each of the Amended and Restated Voting Agreement and Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2, 3.3 and 4.1 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock, options and any other rights to acquire Preferred Stock) and full exercise Derivative Securities then outstanding). At the expiration of all outstanding warrantssuch 20-day period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) “Exempted Securities” (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing Preferred Stock to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Additional Purchasers pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Series A Offering.
Appears in 1 contract
Samples: Investor Rights Agreement (Gryphon Online Safety, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor of the Company, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement, the Voting Agreement and the Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as a primary issuance an “Investor” under each such agreement (“Shares”), provided that any Competitor of the Company shall first make not be entitled to any rights as an offering Investor under Subsections 3.1, 3.2, 3.3 and 4.1 hereof), and (z) agrees to purchase at least such number of such Shares New Securities as are allocable hereunder to each Participation Rights Holder in accordance with the following provisions:Investor holding the fewest number of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Series A Preferred Stock pursuant to Section 3.4)that certain Series A Preferred Stock Purchase Agreement between the Company and the other parties thereto dated April 15, in 2016; (iv) the event issuance of shares of Series A-1 Preferred Stock pursuant to that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3certain Series A-1 Preferred Stock Purchase Agreement between the Company and the other parties thereto dated August 16, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative 2016; (v) the issuance of shares of Series B-1 Preferred Stock pursuant to the Participation Rights Holders purchasing Purchase Agreement; and (vi) the largest proportion issuance of such Participation Rights Holder’s pro rata share. In addition shares of Series B-2 Preferred Stock pursuant to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Keros Therapeutics, Inc.)
Right of First Offer. Subject to In the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco event that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of-------------------- issue, or securities convertible into proposes to grant rights or exercisable for any shares ofoptions to purchase, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”)Permitted Pari-Passu Equity, the Company shall first make an offering promptly deliver a written notice of such Shares to each Participation Rights Holder in accordance with proposal (the following provisions:
(a) The Company shall deliver a notice by certified mail (“"PPPE Notice”") to the Participation Rights Holders stating (i) its bona fide intention to offer such SharesAvalon Investors specifying in reasonable detail the ----------- class, (ii) the number quantity and material terms of such Shares Permitted Pari Passu Equity and the price at which such securities are proposed to be offered, and (iii) the price and terms, if any, upon which it proposes offered for sale to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder others. The Avalon Investors may elect to purchase or obtain, such Permitted Pari Passu Equity subject to terms and at the price and on the other terms specified and conditions set forth in the Notice, up to that portion PPPE Notice by delivering a written notice of such Shares which equals election (the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears "PPPE Election Notice") to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the within ten (10) day period commencing Business Days after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for --------------------- PPPE Notice has been received by the Participation Rights Holders that is equal Avalon Investors. In the event there has not been a timely election to acquire such Permitted Pari Passu Equity under this Section 6(b), then the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during within the forty five (45) 180-day period following the expiration of such 10-Business Day period, sell the period provided Equity Securities specified in subsection 2.3(b) hereofthe PPPE Notice, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, than the purchase price per Equity Security stated in the PPPE Notice and upon on terms no and conditions not materially more favorable to the offeree purchaser(s) thereof than those specified in the such PPPE Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding that in such case the Equity -------- ------- Securities specified in the PPPE Notice shall be subject to the Right of First Refusal set forth in Section 6(a). In the event the Company is unable to sell the Equity Securities specified in the PPPE Notice during such 180-day period, the Company shall not thereafter issue or sell any such waiver (or waiver of Equity Securities without first again offering such provisions pursuant securities to Section 3.4), the Avalon Investors in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by accordance with this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”6(b).
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement as an “Investor” under each such agreement provided that any Competitor shall not be entitled to any rights as a primary issuance Major Investor under Subsections 3.1, 3.2 and 4.1 hereof) and (“Shares”), z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding) (such amount for each investor, options and other rights to acquire Preferred Stockthe “Pro Rata Share”). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Alto Neuroscience, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as a primary issuance an “Investor” under each such agreement (“Shares”provided that any Competitor or FOIA Party shall not be entitled to any rights as an Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Series C Preferred Stock pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company or Fusion Ireland proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue Preferred Shareholder. A Preferred Shareholder shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Associates and Affiliates and its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes U.S. Exchange Act, of such Preferred Shareholder (“Investor Beneficial Owners”); provided that, each such Investor Beneficial Owner: (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to offer by the Board, and (y) agrees to (i) enter into the Shareholder Agreements as a “Shareholder” under each such Shareholder Agreement and (ii) if any additional shares ofPreferred Shares are issued as New Securities, or securities convertible into or exercisable for any shares ofas an “Investor” under this Agreement (provided that, any class of its capital stock for sale and issuance by the Company Competitor shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Section 3.1 and as an Investor under this Section 4.1), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company or Fusion Ireland, as applicable, shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Preferred Shareholder, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company or Fusion Ireland, as applicable, within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Preferred Shareholder may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Notice, Offer Notice up to that portion of such New Securities that equals, excluding any Special Voting Shares which equals (and assuming the redemption of such Special Voting Shares), the proportion that the Common Shares then held by such Preferred Shareholder (including all Common Shares issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of any Derivative Securities then held by such Preferred Shareholder) bears to the total number of shares Common Shares then outstanding (assuming full conversion and/or exercise, as applicable, of all Derivative Securities (including for certainty, all Common Stock Shares issued or issuable, directly or indirectly, upon conversion exercise or exchange, as applicable, of all outstanding (i) any allocated but unexercised options in the capital of the Company; and (ii) any Exchangeable Shares)); and provided further that such New Securities shall be shares in the capital of the Company if such Preferred Stock then held by Shareholder is a holder of Class Preferred Shares at the time of such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exerciseelection, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases such New Securities shall be completed shares in the capital of Fusion Ireland if such Holder is a holder of Exchangeable Shares at the same closing time of such election. At the expiration of such 20 day period, the Company or Fusion Ireland, as applicable, shall promptly notify each Preferred Shareholder that of any third party purchasers elects to purchase or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases acquire all the shares New Securities available to it (each, a “Fully-Fully Exercising HolderInvestor”) of the failure of any other Participation Rights HolderPreferred Shareholder’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company or Fusion Ireland, as applicable, has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company or Fusion Ireland, as applicable, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Preferred Shareholders were entitled to subscribe for but which that were not subscribed for by the Participation Rights Holders Preferred Shareholders that is equal to the proportion that the number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock any Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock any Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed New Securities. The closing of any sale pursuant to this Section 4.1(b) shall occur on the later of (i) 90 days of the date that the Offer Notice is given; and (ii) the date of initial sale of New Securities pursuant to Section 4.1(c). Notwithstanding the foregoing, neither the Company nor Fusion Ireland shall be required to offer or sell such New Securities to any Preferred Shareholder who would cause the Company to be in violation of applicable federal securities laws by virtue of such offer or sale.
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company or Fusion Ireland, as applicable, may, during the forty five (45) 90-day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a the same price not less than, and upon the same terms no more favorable to the offeree than those as specified in the Offer Notice. If the Company or Fusion Ireland, as applicable, does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Preferred Shareholders in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporationany Exempted Securities; or (ii) the assignment by the Company of a right of first refusal that the Company may have any Preferred Shares issued in accordance with respect to any proposed sale of shares Sections 1.1 and 1.2 of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Subscription Agreement.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Fusion Pharmaceuticals Inc.)
Right of First Offer. (a) Subject to the terms and conditions specified in this Section 2.318, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination Investor a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriateSecurities. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”)Securities, the Company shall first make an offering of such Shares the Securities to each Participation Rights Holder the Investors in accordance with the following provisions:.
(ab) The Company shall deliver a notice by certified mail in accordance with Section 26.2 (“"Notice”") to the Participation Rights Holders each Investor stating (i) its bona fide intention to offer such Sharesthe Securities, (ii) the number of such Shares Securities to be offeredoffered (the "Offered Securities"), and (iii) the price and terms, if any, terms upon which it proposes to offer such Sharesthe Offered Securities.
(bc) Within fifteen By written notification received by the Company, within twenty (1520) calendar days after delivery receipt of the Notice, each Participation Rights Holder the Investor may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which the Offered Securities that equals the proportion that the number of shares of Common Stock issuableSecurities issued and held by the Investor, directly or indirectlyafter giving effect to the exchange, upon exercise and conversion of all outstanding shares of Preferred Stock then Securities held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding Investor that are exchangeable and all shares of Common Stock issuableexercisable for and convertible into Securities, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued Securities then outstanding, after giving effect to the exchange, exercise and held, or issuable upon conversion of Preferred Stock all securities then held, by all such Fully Exercising Investors who desire to purchase Shares outstanding that are exchangeable and exercisable for which Participation Rights Holders did not subscribeand convertible into Securities.
(cd) The Notwithstanding Section 18(c), [*].
(e) If all Offered Securities that Investors are entitled to obtain pursuant to Sections 18(c) and (d) are not elected to be obtained as provided in Sections 18(c) and (d) hereof, the Company may, during the forty five one hundred twenty (45120) day period following the expiration of the period provided in subsection 2.3(b18(c) hereof, offer the remaining unsubscribed portion of the Shares such Offered Securities to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares Offered Securities within such period, or if such agreement is not consummated within forty five sixty (4560) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares Offered Securities shall not be offered unless first reoffered to the Participation Rights Holders Investor in accordance herewith.
(df) The right of first offer in this Section 2.3 18 shall not be applicable to (i) the issuance or sale of securities excluded from shares of Common Stock (or options therefor) to employees, directors and consultants for the definition primary purpose of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporationsoliciting or retaining their services; (ii) the assignment by the Company issuance of Securities pursuant to a right of first refusal that the Company may have with respect to any proposed sale bona fide public offering of shares of the Company’s capital stock; or Common Stock, (iii) the issuance of securities that Participation Rights Holders holding Securities in connection with a majority bona fide business acquisition of or by the Registrable Company, whether by merger, consolidation, sale of assets, sale or exchange of stock or otherwise, (iv) the issuance of stock, warrants or other Securities held by Participation Rights Holders agree in writing or rights not primarily for equity financing purposes to exclude from persons or entities with which the provisions of this Section 2.3; providedCompany has business relationships or will have a strategic business relationship following such issuance, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata sharevi) [*]. In addition to the foregoing, the The right of first offer in this Section 2.3 18(c) [*] shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at terminate upon the time closing of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Samples: Shareholders Agreement (Ariba Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself and (ii) its Affiliates; provided that each such Affiliate agrees to enter into this Agreement and each of the Company proposes to offer any additional shares ofVoting Agreement and Right of First Refusal and Co-Sale Agreement, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (an “Shares”), the Company shall first make an offering of Investor” under each such Shares to each Participation Rights Holder in accordance with the following provisions:agreement.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Series D Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsSeries D Preferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series D Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series D Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1(c).
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); and (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series D Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. (a) Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major HolderInvestor, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco provided that the Board of Directors has not reasonably determined that such Major Investor is a Competitor of the Company. A Major Investor shall be entitled to apportion the right of first offer hereby granted to it among itself and its Affiliates in such proportions as it deems appropriate, provided that each such Affiliate (x) is not a Competitor of the Company has made as reasonably determined by the Board of Directors, and (y) agrees to enter into this Agreement and the Stockholders Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor shall not be entitled to any rights as a Cisco Major Investor under Subsections 3.1, 3.2 and 4.1 hereof).
(b) Notwithstanding anything to the contrary herein, for so long as TRV, RA Capital, Goldman or Vertex, respectively, is deemed a Major Investor, TRV, RA Capital, Xxxxxxx or Vertex, as applicable, shall have the right to apportion its right of first offer of New Securities pursuant to Subsection 4.1(a) among itself, its Affiliates, and such unaffiliated third parties as TRV, RA Capital, Xxxxxxx or Vertex, as applicable, reasonably deems appropriate (each such Affiliate or unaffiliated third party, a “Permitted Transferee”), provided that each such Permitted Transferee (x) is not a Competitor Determination of the Company as reasonably determined by the Board of Directors, and (y) agrees to enter into or join this Agreement and any other stockholder agreement with the Company that TRV, RA Capital, Goldman or Vertex, as applicable, is party to or would become a party to if it exercised its right of first offer, as an “Investor” under each such agreement. TRV, RA Capital, Xxxxxxx or Vertex, as applicable, shall provide the Company with advanced written notice of any such apportionment of rights to a Permitted Transferee prior to the deadline set forth in Subsection 4.1(d) by which TRV, RA Capital, Goldman or Vertex, as applicable, is required to notify the Company of TRV’s, RA Capital’s, Xxxxxxx’x or Vertex’s, as applicable, or its Permitted Transferees’ as applicable, intention to exercise its right of first offer with respect to future sales by a given issuance of New Securities, and TRV, RA Capital, Goldman or Vertex, as applicable, and the Permitted Transferee shall provide the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long with such other information as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue Company reasonably requests in connection with such apportionment of rights to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Permitted Transferee.
(ac) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(bd) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the Common Stock then held by such Major Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock Company then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities then outstanding). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders such Major Investors were entitled to subscribe subscribe, but which that were not subscribed for by the Participation Rights Holders that Major Investors, which is equal to the proportion that the Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully Exercising Investor bears to the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred twenty (120) days after the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(ce) The If fewer than all New Securities referred to in the Offer Notice are elected to be purchased or acquired as provided in Subsection 4.1(d), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(d), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(df) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; ), and (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO.
(iiig) the issuance of securities that Participation Rights Holders holding a majority The rights of the Registrable Major Investors to purchase New Securities held by Participation Rights Holders agree under this Subsection 4.1 may be modified or waived in writing to exclude from the provisions of this Section 2.3accordance with Subsection 6.6; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), that in the event that a Participation Rights Holders actually purchases Shares in such rights to purchase New Securities under this Subsection 4.1 are waived and any transaction contemplated by this Section 2.3Major Investor(s) purchase New Securities, then each other Participation Rights Holders the Company shall be permitted to participate on a pro rata basis relative give notice to the Participation Rights Holders purchasing other Major Investors within thirty (30) days after the largest proportion initial issuance of New Securities. Such notice shall describe the type, price, and terms of the New Securities. Each such other Major Investor shall have twenty (20) days from the date such notice is given to elect to purchase on similar terms and conditions in a subsequent closing up to the number of New Securities that would, if purchased by such Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(d) before giving effect to the issuance of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself and (ii) its Affiliates (which for this Section 4, shall include limited partners of a fund, so long as such limited partners are accredited investors and provided that each such Affiliate (x) is not a Competitor of the Company proposes Company, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, and (y) agrees to enter into this Agreement and each of the Voting Agreement and the Right of First Refusal and Co-Sale Agreement, as an “Investor” under each such Agreement (provided that any Competitor shall not be entitled to any rights as an Investor or Major Investor under Subsections 3.1, 3.2, 4.1 and 4.2 hereof, provided further that a primary issuance (Major Investor shall not be considered a “Shares”Competitor” solely because such Major Investor has a 10% or less ownership interest in a Competitor), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:).
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, held by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, held by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewith.with this Subsection 4.1(b)
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; IPO or (iii) the issuance shares of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Preferred Stock issued pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Werewolf Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Series A-2 Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of one hundred twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); and (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO.
(iiie) Notwithstanding any provision hereof to the issuance contrary, in lieu of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from complying with the provisions of this Section 2.3; provided4.1, however, notwithstanding any such waiver (or waiver of such provisions pursuant the Company may elect to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative give notice to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Major Investors within thirty
Appears in 1 contract
Samples: Investors’ Rights Agreement (Life Spectacular, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among (i) itself and (ii) its Affiliates; provided that each such Affiliate (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance Board of Directors, and (y) agrees to enter into this Agreement and the Amended and Restated Voting Agreement of even date herewith among the Company, the Investors and the other parties named therein (the “SharesVoting Agreement”), the Company as an “Investor” under each such agreement each as may be amended and/or restated from time to time (provided that any Competitor or FOIA Party shall first make an offering of such Shares not be entitled to each Participation Rights Holder in accordance with the following provisions:any rights as a Major Investor under Subsections 3.1, 3.2 and 4.1 hereof).
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; IPO or SPAC Transaction or (iii) the issuance shares of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Series C Preferred Stock issued pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, and (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the Common Stock then held by such Major Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series Mezzanine Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Series Mezzanine Preferred Stock and any other Derivative Securities then outstanding) (such calculation, the “Pro Rata Share”). For purposes of calculating the Pro Rata Share with respect to the Viking Convertible Note: (i) at any time prior to the conversion of the Viking Convertible Note, the Pro Rata Share with respect thereto shall be calculated assuming that the holder thereof is permitted to convert the Viking Convertible Note pursuant to a Maturity Date Conversion (as defined therein) as of the date of such calculation; and (ii) at any time after conversion of the Viking Convertible Note, the Pro Rata Share shall be calculated based on the actual number of shares of Common Stock issuable, directly or indirectly, Derivative Securities issued upon conversion of all outstanding shares the Viking Convertible Note. At the expiration of Preferred Stock then held by such Participation Rights Holder bears to twenty (20) day period, the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series Mezzanine Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series Mezzanine Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series Mezzanine Preferred Stock to Future Purchasers pursuant to the Purchase Agreement.
(e) The right of first offer set forth in this Subsection 4.1 shall terminate with respect to any Major Investor who fails to purchase, in any transaction subject to this Subsection 4.1, all of such Major Investor’s pro rata amount of the Registrable New Securities held allocated (or, if less than such Major Investor’s pro rata amount is offered by Participation Rights Holders agree the Company, such lesser amount so offered) to such Major Investor pursuant to this Subsection 4.1. Following any such termination, such Investor shall no longer be deemed a “Major Investor” for any purpose of this Subsection 4.1
(f) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Samples: Option Agreement (Inhibrx, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner: (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, and (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1, offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five sixty (4560) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series C Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from Purchase Agreement; and (iv) the provisions issuance of this Section 2.3; providedsecurities that, howeverwith unanimous approval of the Company’s Board of Directors, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall are not be applicable with respect offered to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at existing stockholder of the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Company.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and the Second Amended & Restated Voting Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Derivative Securities then held, held by such Fully-Exercising Holder Major Investor) bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribethe Company.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), Common Stock issued in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor currently holding Preferred Stock at the time of such offering. Such Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (y) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors and (z) agrees to enter into this Agreement and each of the Second Amended and Restated Voting Agreement and the Second Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred and twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Samples: Investors’ Rights Agreement (MBX Biosciences, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor.47 A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it. in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates [and (iii) its beneficial interest holders, such as limited partners, members or any other Person having "beneficial ownership," as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor ("Investor Beneficial Owners"); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party's purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the [Amended and Restated] Voting Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an "Investor" under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such [Class A] Preferred Shares to each Participation Rights Holder in accordance with the following provisions:
(a) and any other Derivative Securities]. The Company shall deliver a give notice by certified mail (“the "Offer Notice”") to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
New Securities. By notification to the Company within twenty (b20) Within fifteen (15) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities48 which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock Shares then held by such Participation Rights Holder Major Investor (including all Common Shares then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the [Class A] Preferred Shares and any other Derivative Securities then held by such Major Investor) bears to the aggregate number total Common Shares of shares of Common Stock the Company [then outstanding (assuming full conversion and/or exercise, as applicable, of all [Class A] Preferred Shares and any other Derivative Securities then outstanding)][Alternative: then held by all shares of the Major Investors (including all Common Stock issuable, Shares issuable (directly or indirectly, ) upon conversion of all outstanding shares of Preferred Stock (assuming full and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsthe [Class A] Preferred Shares and any other Derivative Securities then held by the Major Investors)].49 At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-"Fully Exercising Holder”Investor") of any other Participation Rights Holder’s Major Investor's failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of [Class A] Preferred Stock Shares and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the [Class A] Preferred Stock Shares and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did such unsubscribed shares.50 The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of [ninety/one hundred twenty (90/120)] days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c). If all New Securities referred to in the Offer Notice are not subscribe.
(c) The elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five [ninety (45) 90)] day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five [thirty (45) 30)] days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewith.
(d) The right of first offer in with this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”4.1.
Appears in 1 contract
Samples: Investors' Rights Agreement
Right of First Offer. Subject to the terms and conditions specified in this Section 2.35, the Company VMN hereby grants the participation rights set forth in this Section 2.3 to (A) each Major HolderIntel, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company VMN of its Shares New Securities (as hereinafter defineddefined in subsection 5(d)(i), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.35, Participation Rights Holder the term "Intel" includes any Affiliated Persons partners, shareholders or affiliates of a Participation Rights Holder and a Participation Rights Holder who chooses Intel. Intel shall be entitled to exercise apportion the right of first offer may designate as purchasers under such right hereby granted among itself or and its Affiliated Personspartners, shareholders and affiliates in such proportions as it deems appropriate. Each time .
a. In the Company event VMN proposes to issue New Securities, it shall give Intel written notice (the "Notice") of its intention stating (i) a description of the New Securities it proposes to issue, (ii) the number of shares of New Securities it proposes to offer, (iii) the price per share at which, and other terms on which, it proposes to offer such New Securities and (iv) the number of shares that Intel has the right to purchase under this Section 5, based on Intel's Percentage (as defined in Subsection 5(d)(ii)).
b. Within thirty (30) days after the Notice is given (in accordance with Section 15), Intel may elect to purchase, at the price specified in the Notice, up to the number of shares of the New Securities proposed to be issued equal to Intel's Percentage. An election to purchase shall be made in writing and must be given to VMN within such thirty (30) day period (in accordance with Section 15).
c. VMN shall have ninety (90) days after the last date on which Intel's right of first offer lapsed to enter into an agreement (pursuant to which the sale of New Securities covered thereby shall be closed, if at all, within forty-five (45) days from the execution thereof) to sell the New Securities which Intel did not elect to purchase under this Section 5, at or above the price and upon terms not materially more favorable to the purchasers of such securities than the terms specified in the initial Notice given in connection with such sale. In the event VMN has not entered into an agreement to sell the New Securities within such ninety (90) day period (or sold and issued New Securities in accordance with the foregoing within forty-five (45) days from the date of such agreement), VMN shall not thereafter issue or sell any additional New Securities without first offering such New Securities to Intel in the manner provided in this Section 5.
d. (i) "New Securities" shall mean any shares of, or securities convertible into or exercisable for any shares of, any class of its VMN's capital stock for sale and issuance by stock; provided that "New Securities" does not include: (A) the shares of Series A Preferred Stock of the Company as a primary issuance or the Common Stock issuable upon conversion thereof; (“Shares”)B) securities issued pursuant to the acquisition of another business entity by VMN by merger, purchase of substantially all of the Company shall first make an offering assets of such Shares to each Participation Rights Holder in accordance with entity, or other reorganization whereby VMN owns not less than a majority of the following provisions:
(a) The Company shall deliver a notice by certified mail (“Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) the number voting power of such Shares to be offered, and entity; (iiiC) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion 500,000 shares of such Shares which equals VMN Common Stock and the proportion that the number of shares of Common Stock issuableissuable upon exercise of such options, directly issued pursuant to any arrangement approved by the Board of Directors to employees, officers and directors of, or indirectlyconsultants, upon conversion of all outstanding advisors or other persons performing services for, VMN; (D) shares of VMN's Common Stock or Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares any series issued in connection with any stock split, stock dividend or recapitalization of VMN; (E) Common Stock then outstanding and all shares issued upon exercise of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise or convertible securities if the issuance of all outstanding such warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, convertible securities was a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion result of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number exercise of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in granted under this Section 2.3 shall not be applicable 5 or was subject to the right of first offer granted under this Section 5; and (F) securities sold to the public in an offering pursuant to a registration statement filed with respect to any Participation Rights Holder the Securities and any particular subsequent securities issuance, if Exchange Commission (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a"SEC") under the Securities Act of 1933, as amended (the "Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”").
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among (i) itself and (ii) its Affiliates; provided that each such Affiliate (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance Board of Directors (“Shares”including at least one Series A Director if then in office), (y) agrees to enter into this Agremeent and each of the Company Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall first make not be entitled to any rights as an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Investor under Subsections 3.1, 3.2 and 4.1 hereof).
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Investor) bears to the total Common Stock then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Series A Preferred Stock then held, held by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Series A Preferred Stock then held, held by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred and twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five one hundred and twenty (45120) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated as defined in Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series A Preferred Stock pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself,(ii) its Affiliates, and (iii) its benefit interest holders, such as limited partners, members or any other Person having a “beneficial ownership,” such as term is defined in Rule 13d-3 promulgated under the Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial owner (x) is not a Competitor of the Company proposes or a FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Amended and Restated Voting Agreement and the Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Major Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Preferred Stock and any other Derivative Securities then outstanding and all including any shares of Common Stock issuablereserved for issuance under the Company’s equity incentive plans or similar arrangements). At the expiration of such 20 day period, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Preferred Stock pursuant the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Vigil Neuroscience, Inc.)
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (Aa) each Major Holder, (B) Cisco Systems so long as Except for (i) Cisco continues shares of Common Stock issued or sold to hold at least 180,729 shares (as adjusted for stock splitsemployees or directors of the Company pursuant to an existing Benefit Plan or any new Benefit Plan adopted by the Company in good faith, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board Proposed Sale, (iii) a public offering of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales Common Stock by the Company or (iv) the issuance or transfer of its Shares (as hereinafter defined)shares of Common Stock to unaffiliated third parties in connection with licensing or similar arrangements consistent with past practice, (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time event that the Company proposes to offer issue or sell any additional shares of, of Common Stock or securities convertible into or exercisable for shares of Common Stock and the purchase price for such shares of Common Stock, or the conversion price or exercise price for the shares of Common Stock into which such securities are convertible or for which such securities are exercisable, as the case may be, shall be less than the Market Value (as hereinafter defined) on the date notice is given pursuant to clause (i) below:
(i) the Company shall give each of the Investors written notice of its intent to issue or sell such shares of Common Stock or other securities, specifying the number thereof to be sold, the purchase price and the terms and conditions of such sale and offering;
(ii) if, within 5 Business Days (as hereinafter defined) after receipt of the notice given pursuant to clause (i) above one or more Investors shall not have accepted such offer in writing with respect to any shares ofof Common Stock or other securities specified in such notice, then the Company shall be free to issue or sell to any class third party such shares of its capital stock for Common Stock or other securities with respect to which such offer has not been accepted at a price equal to or above the purchase price and on other terms and conditions no less favorable to the Company than those specified in such notice at any time within 45 days of the expiration of such 5-Business Day period; provided that if such shares of Common Stock shall be sold to an officer, director or an affiliate of the Company, either (x) the material facts as to such officer's, director's or affiliate's relationship and as to the sale of Common Stock are disclosed or are known to the Board of Directors, and issuance the Board of Directors in good faith authorizes the sale by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum, or (y) the material facts as to such officer's, director's or affiliate's relationship and as to the sale of Common Stock are disclosed or are known to the shareholders entitled to vote thereon, and the sale is specifically approved in good faith by vote of the shareholders, or (z) the sale of Common Stock is fair to the Company as a primary issuance of the time it is authorized, approved or ratified, by the Board of Directors or the shareholders;
(“Shares”), iii) if the Company shall first make an offering of not have consummated such issuance or sale within the 45-day period referred to in clause (ii) above, then the Company may not thereafter sell such Shares to each Participation Rights Holder in accordance or other securities without complying again with the following provisions:provisions of this Section 4.2; and
(aiv) The Company if one or more Investors shall deliver a have accepted such offer in whole or in part within 5 Business Days after receipt of the notice by certified mail (“Notice”) given pursuant to the Participation Rights Holders stating clause (i) its bona fide intention above, then such Investor or Investors shall purchase such shares of Common Stock and/or other securities as to which such offer such Shares, (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shareshas been accepted as promptly as is reasonably practicable.
(b) Within fifteen For purposes of this Section 4.2, "Market Value" means (151) calendar days after delivery if the Common Stock is quoted on the National Market System of the NoticeNational Association of Securities Dealers, each Participation Rights Holder may elect to purchase Inc. Automated Quotation System (the "National Market System") or obtainis listed on one or more stock exchanges, at the price and on average of the terms specified in the Notice, up to that portion closing sales prices of such Shares which equals the proportion that the number of shares a share of Common Stock issuableon the National Market System if quoted thereon or on the primary national or regional stock exchange on which such shares are listed or (2) if the Common Stock is not so quoted or listed but is traded in the over-the-counter market (other than the National Market System), directly the average of the closing bid and asked prices of a share of Common Stock, in the case of clauses (1) and (2), for the 20 trading days (or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate lesser number of shares trading days as the Common Stock shall have been so listed, quoted or traded) next preceding the date of measurement or (3) if the Common Stock is not so quoted or listed and is not traded in the over-the-counter market, the fair market value of a share of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, determined reasonably and in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for good faith by the Participation Rights Holders that is equal to the proportion that the number Board of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) Directors of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of . "Business Day" means a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; day on which federal or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), state chartered banking institutions located in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated State of Connecticut are authorized by this Section 2.3, then each other Participation Rights Holders shall be permitted law to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”close.
Appears in 1 contract
Right of First Offer. (a) Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major HolderInvestor, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco provided that the Board of Directors has not reasonably determined that such Major Investor is a Competitor of the Company. A Major Investor shall be entitled to apportion the right of first offer hereby granted to it among itself and its Affiliates in such proportions as it deems appropriate, provided that each such Affiliate (x) is not a Competitor of the Company has made as reasonably determined by the Board of Directors, and (y) agrees to enter into this Agreement and the Stockholders Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor shall not be entitled to any rights as a Cisco Major Investor under Subsections 3.1, 3.2 and 4.1 hereof).
(b) Notwithstanding anything to the contrary herein, for so long as TRV, RA Capital, Goldman or Vertex, respectively, is deemed a Major Investor, TRV, RA Capital, Xxxxxxx or Vertex, as applicable, shall have the right to apportion its right of first offer of New Securities pursuant to Subsection 4.1(a) among itself, its Affiliates, and such unaffiliated third parties as TRV, RA Capital, Xxxxxxx or Vertex, as applicable, reasonably deems appropriate (each such Affiliate or unaffiliated third party, a “Permitted Transferee”), provided that each such Permitted Transferee (x) is not a Competitor Determination of the Company as reasonably determined by the Board of Directors, and (y) agrees to enter into or join this Agreement and any other stockholder agreement with the Company that TRV, RA Capital, Goldman or Vertex, as applicable, is party to or would become a party to if it exercised its right of first offer, as an “Investor” under each such agreement. TRV, RA Capital, Xxxxxxx or Vertex, as applicable, shall provide the Company with advanced written notice of any such apportionment of rights to a Permitted Transferee prior to the deadline set forth in Subsection 4.1(d) by which TRV, RA Capital, Xxxxxxx or Vertex, as applicable, is required to notify the Company of TRV’s, RA Capital’s, Xxxxxxx’x or Vertex’s, as applicable, or its Permitted Transferees’ as applicable, intention to exercise its right of first offer with respect to future sales by a given issuance of New Securities, and TRV, RA Capital, Goldman or Vertex, as applicable, and the Permitted Transferee shall provide the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long with such other information as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue Company reasonably requests in connection with such apportionment of rights to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Permitted Transferee.
(ac) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(bd) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the Common Stock then held by such Major Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock Company then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities then outstanding). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders such Major Investors were entitled to subscribe subscribe, but which that were not subscribed for by the Participation Rights Holders that Major Investors, which is equal to the proportion that the Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully Exercising Investor bears to the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred twenty (120) days after the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(ce) The If fewer than all New Securities referred to in the Offer Notice are elected to be purchased or acquired as provided in Subsection 4.1(d), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(d), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(df) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; ), and (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stock; or IPO.
(iiig) the issuance of securities that Participation Rights Holders holding a majority The rights of the Registrable Major Investors to purchase New Securities held by Participation Rights Holders agree under this Subsection 4.1 may be modified or waived in writing to exclude from the provisions of this Section 2.3accordance with Subsection 6.6; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), that in the event that a Participation Rights Holders actually purchases Shares in such rights to purchase New Securities under this Subsection 4.1 are waived and any transaction contemplated by this Section 2.3Major Investor(s) purchase New Securities, then each other Participation Rights Holders the Company shall be permitted to participate on a pro rata basis relative give notice to the Participation Rights Holders purchasing other Major Investors within thirty (30) days after the largest proportion initial issuance of New Securities. Such notice shall describe the type, price, and terms of the New Securities. Each such other Major Investor shall have twenty (20) days from the date such notice is given to elect to purchase on similar terms and conditions in a subsequent closing up to the number of New Securities that would, if purchased by such Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(d) before giving effect to the issuance of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself and (ii) its Affiliates; provided that each such Affiliate (x) is not a competitor of the Company proposes to offer any additional shares ofCompany, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance as reasonably determined by the Company Board of Directors, unless such party’s purchase of New Securities is otherwise consented to by the Board of Directors, and (y) agrees to enter into this Agreement and the Sixth Amended and Restated Voting Agreement dated as a primary issuance (“Shares”)of December 11, 2017 among the Company, the Company shall first make Investors and the other parties named therein, as an offering of “Investor” under each such Shares to each Participation Rights Holder in accordance with the following provisions:agreement.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of Common Stock then held by such Major Investor (including all shares of Common Stock issuable, directly or indirectly, then issuable upon conversion of all outstanding shares of the Preferred Stock then held by such Participation Rights Holder Major Investor) bears to the aggregate number of shares of total Common Stock of the Company then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights Derivative Securities) (with respect to acquire Preferred Stockeach Major Investor, such Major Investor’s “Pro Rata Portion”); provided, however, that the portion of New Securities offered to the Major Investors pursuant to this Section 4 may be reduced by up to fifty percent (50%) of each Major Investor’s Pro Rata Portion if the Board of Directors (x) unanimously determines in good faith that such a reduction is necessary to attract strategically required investment in the Company and full exercise (y) notifies the Major Investors of all outstanding warrantssuch determination and each Major Investors’ cut-back portion of the New Securities in the Offer Notice. At the expiration of such twenty (20) day period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of the Preferred Stock then held, held by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or then issuable upon conversion of the Preferred Stock then held, held by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), as defined in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, Amended Articles); and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Adaptive Biotechnologies Corp)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among (i) itself and (ii) its Affiliates; provided that each such Affiliate (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Class A Preferred Shares to each Participation Rights Holder in accordance with the following provisions:and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock Shares then held by such Participation Rights Holder bears to the aggregate number of shares of Major Investor (including all Common Stock Shares then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion of all outstanding shares of Preferred Stock (assuming full and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options the Class A Preferred Shares and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Derivative Securities then held, held by such Fully-Exercising Holder Major Investor) bears to the total number Common Shares of shares the Company then outstanding (assuming full conversion and/or exercise, as applicable, of Common Stock issued all Class A Preferred Shares and held, or issuable upon conversion other Derivative Securities). The closing of Preferred Stock then held, by all such Fully Exercising Investors who desire any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Subsection 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons (other than a Competitor) at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IVArticles), Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) Common Shares issued in the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; IPO, or (iii) Equity Securities issued pursuant to the issuance of securities that Participation Rights Holders holding a majority of Company’s obligations under any collaboration, out-licensing or similar agreement entered into by the Registrable Securities held by Participation Rights Holders agree in writing Company prior to exclude from the provisions of this Section 2.3date hereof; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), that in the event that a Participation Rights Holders actually purchases the Equity Securities issued pursuant to the Company’s obligations under any collaboration, out-licensing or similar agreement exceed ten percent (10%) of the Common Shares in then issued, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Class A Preferred Shares and any transaction contemplated by this Section 2.3other Derivative Securities, then each other Participation Rights Holders shall be permitted Major Investor will have the right, under procedures and timing similar to participate on a pro rata basis relative to that set forth in Subsection 4.1 but conducted after closing of the Participation Rights Holders purchasing the largest proportion issuance of such Participation Rights Holder’s pro rata share. In addition Exempted Securities, to purchase a number of Common Shares, at the foregoingsame price, sufficient to allow such Major Investor and its Affiliates, collectively, to beneficially own, after the issuance of such Exempted Securities, the right same percentage of first offer in this Section 2.3 shall not the issued and outstanding shares of the capital of the Company (of all classes and series, whether common, preferred, special or otherwise, together with any other class or classes of shares of the capital of the Company which are hereafter created, including any shares or securities into which such shares may be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuanceconverted or changed or which result from a consolidation, if (i) at the time subdivision, reclassification or redesignation of such subsequent securities issuanceshares or securities) as such Major Investor and its Affiliates, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Actcollectively, and (ii) beneficially owned prior to such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Exempted Securities.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants shall first offer such New Securities to each Major Investor and each existing holder of Series Seed Preferred Stock (collectively, the participation rights set forth “ROFO Investors”) in accordance with this Section 2.3 4. A ROFO Investor shall be entitled to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates (but not co-investors) and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such ROFO Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement dated of even date herewith (and as may be amended from time to time) among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering ROFO Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each ROFO Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder ROFO Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of ROFO Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such ROFO Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities, but excluding authorized but unissued shares reserved for issuance under the Stock Plan, including any increase in the number of authorized shares reserved for issuance under the Stock Plan in connection with any future equity financings). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder ROFO Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderROFO Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders ROFO Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that ROFO Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred and twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders ROFO Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of IncorporationCertificate); or (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale issuance of shares of Preferred Stock pursuant to the Company’s capital stock; or (iii) Purchase Agreement. For the issuance avoidance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions doubt, Toray shall have no rights under Section 4 of this Agreement.
(e) The rights of first offer of each Investor under this Section 2.3; provided4 may be transferred to the same parties, howeversubject to the same restrictions, notwithstanding as any such waiver (or waiver transfer of such provisions registration rights pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”2.12.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Bolt Biotherapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company or any of its Subsidiaries proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, Investor (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco provided that the Board of Directors has not reasonably determined that such Major Investor is a Competitor of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”Company). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses A Major Investor shall be entitled to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (a) is not a Competitor of the Company, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board, (b) is an “accredited investor” (as a primary issuance (“Shares”defined in Rule 501(a) under the Securities Act), (c) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor of the Company shall first make an offering not be entitled to any rights as a Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (d) agrees to purchase at least such number of such Shares New Securities as are allocable hereunder to each Participation Rights Holder in accordance with the following provisions:Major Investor holding the fewest number of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor and its Affiliates) bears to the total Common Stock of the Company then outstanding (assuming the full conversion, and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire securities convertible or exercisable into Common Stock). Such purchases shall be completed at At the same closing as that expiration of any third party purchasers or at an additional closing thereunder. The such 20 day period, the Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Preferred Stock to Additional Purchasers (as defined in the Registrable Securities held by Participation Rights Holders agree Purchase Agreement) pursuant to and subject to the limitations contained in, the Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; provided4.1, howeverthe Company may elect to give notice to the Major Investors within 30 days after the issuance of New Securities. Such notice shall describe the type, notwithstanding price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Section 4.1(b) before giving effect to the issuance of such New Securities.
(f) In the event of any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.34.1 with respect to an issuance of New Securities and the subsequent purchase by any Major Investor (a “Participating ROFR Investor”) of any portion of such New Securities, then each other Participation Rights Holders Major Investor shall be permitted have the right to participate on purchase a pro rata basis relative portion of the New Securities equal to the Participation Rights Holders purchasing product obtained by (A) the largest proportion maximum number of shares of New Securities such Participation Rights Holder’s pro rata share. In addition Major Investor is entitled to purchase pursuant Section 4.1(b) (assuming for such purpose, that each other Major Investor is a Fully Exercising Investor) by (B) the foregoingquotient obtained by (x) the number of shares actually purchased by the Participating ROFR Investor in such issuance of New Securities divided by (y) the maximum number of shares of New Securities that such Participating ROFR Investor is entitled to purchase pursuant Section 4.1(b) (assuming for such purpose, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder that each other Major Investor is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investorsa Fully Exercising Investor); provided, for clarity, that notwithstanding if there is more than one Participating ROFR Investor, then the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance larger fraction obtained pursuant to (B) above shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”apply.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Terns Pharmaceuticals, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Series A Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Series A Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsSeries A Preferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series A Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series A Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1 (c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series A Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement or any Warrant Purchase Agreement (as defined in writing the Purchase Agreement).
(e) Notwithstanding any provision hereof to exclude from the contrary, in lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Anebulo Pharmaceuticals, Inc.)
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3(5) and applicable law, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time if the Company proposes to offer or sell any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company New Securities (as a primary issuance (“Shares”defined below), the Company shall first make an offering of offer such Shares New Securities to each Participation Rights Holder in accordance with the following provisions:Investor as set forth herein.
(ai) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders Investor stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(bii) Within fifteen By notice to the Company within five (155) calendar business days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainpurchase, at the price and on the terms specified in the Offer Notice, up to all of the New Securities; provided, however, that portion in no event shall Investor have such right if the acquisition of such Shares which equals any of the proportion that New Securities would result in Investor holding more than thirty three and one-third percent (33.33%) of the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all Company’s outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, on an as-converted basis, as determined in accordance with Section 13(d) of all outstanding warrantsthe Securities Exchange Act of 1934, options as amended (the “Exchange Act”), and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing rules thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) closing of any other Participation Rights Holder’s failure sale pursuant to do likewise. During the ten this Section (105)A shall occur within thirty (30) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion days of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion date that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeOffer Notice is given.
(ciii) The If the New Securities are not purchased by Investor as provided in Section (5)A(ii), the Company may, during the forty five ninety (4590) day period following the expiration of the period provided in subsection 2.3(b) hereofSection (5)A(ii), offer and sell the remaining unsubscribed portion of New Securities referred to in the Shares Offer Notice to any person or persons entity at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the NoticeOffer Notice (the “Third-Party Offering”). If the Company does not enter into an agreement for the sale of the Shares Third-Party Offering within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investor in accordance herewith.with this Section (5)A.
(div) The right For purposes of first offer in this Section 2.3 shall not be applicable to (i) the issuance of Agreement, “New Securities” means, collectively, equity securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) Company issued after the assignment by the Company of a right of first refusal that the Company may have with respect date hereof, whether or not currently authorized, as well as rights, options, or warrants to any proposed sale of shares of the Company’s capital stock; purchase such equity securities, or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of type whatsoever that are, or may become, convertible or exchangeable into or exercisable for such Participation Rights Investor to participate in any other securities issuance”equity securities.
Appears in 1 contract
Samples: Stock Purchase Agreement (Navidea Biopharmaceuticals, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.35.1 and applicable securities laws, if the Company proposes to offer or sell any equity securities or debt securities convertible into equity securities for the purposes of raising new capital (“New Securities”), the Company hereby grants shall offer such New Securities to each to the participation rights set forth Wetpaint Parties in accordance with this Section 2.3 5.1. Each Wetpaint Party shall be entitled to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among itself and its Affiliates; provided that each such Affiliate agrees to offer any additional shares of, or securities convertible enter into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”)this Agreement, the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with Lockup Agreement and the following provisions:Nomination Agreement.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Wetpaint Party, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within thirty (1530) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Wetpaint Party may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Wetpaint Party (including all shares of Common Stock then outstanding and issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of any derivative securities then held by such Wetpaint Party) bears to Common Stock then held by all holders of Capital Stock (including all shares of Common Stock issuable, then issuable (directly or indirectly, ) upon conversion of all outstanding shares of Preferred Stock (assuming full and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options and other rights to acquire Preferred any derivative securities then held by holders of Capital Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same The closing as that of any third party purchasers or at an additional closing thereunder. The Company sale pursuant to this Section 5.1(b) shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it occur within thirty (each, a “Fully-Exercising Holder”30) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion days of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion date that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeOffer Notice is given.
(c) The Notwithstanding any provision hereof to the contrary, in lieu of complying with the provisions of this Section 5.1, the Company maymay elect to give notice to the Wetpaint Parties within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, during the forty five (45) day period following the expiration price, and terms of the period provided in subsection 2.3(bNew Securities. Each Wetpaint Party shall have thirty (30) hereof, offer days from the remaining unsubscribed portion of the Shares date notice is given to any person or persons at a price not less than, and upon terms no more favorable elect to purchase up to the offeree than those specified number of New Securities that would, if purchased by such Wetpaint Party, maintain such Wetpaint Party’s percentage-ownership position, calculated as set forth in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45Section 5.1(b) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered before giving effect to the Participation Rights Holders in accordance herewithissuance of such New Securities.
(d) The right of first offer in this Section 2.3 5.1 shall not be applicable to Exempted Securities.
(ie) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the The provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver 5.1 shall terminate on the first to occur of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuanceimmediately prior to a Recapitalization or December 31, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”2015.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a QIP Investors and Infoseek (the "Transferring Investors") shall, prior to selling, offering to sell or soliciting any offers for the Transfer of shares of Capital Stock or Options, give written notice by certified mail to each of the other Investors (“Notice”the "Non-Transferring Investors") to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) specifying the number of shares of Capital Stock that such Shares Transferring Investors desire to be offered, and Transfer (iii) the price and terms, if any, upon which it proposes "Transfer Stock"). The notice shall constitute an invitation to each of the other Investors to offer such Shares.
(b) Within fifteen (15) calendar days after delivery to purchase a portion of the Notice, each Participation Rights Holder may elect Transfer Stock for cash and/or marketable securities equal to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that a percentage obtained by dividing (x) the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held beneficially owned by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “FullyNon-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then heldTransferring Investor, by such Fully-Exercising Holder bears to (y) the total number of shares of Common Stock issued and heldbeneficially owned by the Non-Transferring Investors in the aggregate.
(b) Upon receipt of a notice pursuant to Section 2.3(a), or issuable the recipient thereof (the "Offeror") shall have a period of 30 days (the "Offer Period") within which to submit a proposal (the "Proposal") to the Transferring Investors to purchase all, but not less than all, of the Transfer Stock which they are invited to purchase pursuant to Section 2.3(a). If all of the shares of Transfer Stock offered to the Non-Transferring Investors are not fully subscribed by such Non-Transferring Investors by the fifteenth day following receipt of the notice delivered pursuant to Section 2.3(a), the remaining shares of Transfer Stock will be reoffered to the Non-Transferring Investors offering to purchase their full allotment upon conversion of Preferred Stock then heldthe terms set forth in this Section 2.3(b), by until all such Fully Exercising Investors who desire to purchase Shares shares of Transfer Stock are fully subscribed for which Participation Rights Holders did not subscribeor until the expiration of the Offer Period.
(c) The Company Transferring Investors then shall have a period of ten (10) days from the end of the Offer Period within which to respond in writing to the Proposal. If the Transferring Investors accept the Proposal, the Offeror and the Transferring Investors shall be bound to consummate the transaction in accordance with the Proposal as promptly as practicable. If the Transferring Investors accept the Proposal and the transaction is not consummated through no fault of the Transferring Investors within 45 days of the acceptance of the Proposal so delivered or if a Proposal to purchase all, but not less than all, the Transfer Stock is not made by the Non-Transferring Investors in accordance with the provisions of Section 2.3(b) prior to the expiration of the Offer Period, the Transferring Investors shall, for a period of 180 days thereafter, be free to Transfer the Transfer Stock in any manner and to any person notwithstanding the provisions of Section 2.1, Sections 2.3(a) and 2.3(b) and this Section 2.3(c). After such 180-day period, the Transferring Investors shall not Transfer the Transfer Stock without again complying with the provisions of this Section 2.3.
(d) In the event the Transferring Investors reject the Proposal, the Transferring Investors may, during within the forty five (45) 180 days after the expiration of the Offer Period, Transfer the Transfer Stock but only for consideration that is in the Transferring Investors' good faith reasonable judgment more favorable to the Transferring Investors on an overall basis than the consideration contained in the Proposal. The Transferring Investors may not, following the expiration of such 180-day period following the expiration of the period provided in subsection 2.3(b) hereofOffer Period, offer Transfer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have Transfer Stock without again complying with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. The Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right hereby granted to it among itself or and its Affiliated Persons, Affiliates in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (“the "Offer Notice”") to the Participation Rights Holders Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within thirty (1530) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder the Investor, through itself and/or its Affiliates, may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock held and any other Derivative Securities then held, by such Fully-Exercising Holder the Investor bears to the total number of shares of Common Stock issued of the Company then outstanding (assuming full conversion and held, or issuable upon conversion exercise of Preferred Stock then held, by all such Fully Exercising Investors who desire Derivative Securities). The closing of any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Section 4.1(b) shall occur within sixty (60) days of the date that the Offer Notice is given.
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investor in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Permitted Issuances.
Appears in 1 contract
Samples: Investors' Rights Agreement (Data Systems & Software Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, and (y) agrees to enter into this Agreement and the Voting Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(bi) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then held by all the Major Investors (including all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by all the Major Investors). At the expiration of such twenty (assuming full exercise20) day period, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Other Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares such unsubscribed shares.
(ii) Notwithstanding the foregoing in Section 4.1(b)(i), in the case Pronghorn elects to exercise its right of first priority pursuant to the terms of that certain Side Letter, dated March 15, 2024, by and between the Company and Pronghorn (such right, the “Right of First Priority”), the terms of this Section 4.1(b)(ii) will supersede Section 4.1(b)(i). In such event, (1) Pronghorn may, in accordance with its Right of First Priority, elect to purchase or otherwise acquire, at the price and on the terms specified in the Offer Notice, up to fifty percent (50%) of the New Securities subject to the Right of First Priority, and (2) by notification to the Company within twenty (20) days after the Offer Notice is given, the Major Investors that are not Pronghorn (the “Other Major Investors”) may elect to purchase or otherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such remaining fifty percent (50%) of applicable New Securities (the “Remaining New Securities”) which equals the proportion that the Common Stock then held by such Other Major Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Other Major Investors) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Preferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, the Company shall promptly notify each Other Major Investor that elects to purchase or acquire all the shares available to it (each, a “Fully Exercising Other Major Investor”) of any other Major Investor’s failure to do likewise. During the ten (10) day period commencing after the Company has given such notice, each Fully Exercising Other Major Investor may, by giving notice to the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the applicable New Securities for which Participation Rights Holders did Other Major Investors were entitled to subscribe but that were not subscribesubscribed for by the Major Investors which is equal to the proportion that the Common Stock then held by such Other Major Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Other Major Investors) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Preferred Stock and any other Derivative Securities then outstanding), by all Fully Exercising Other Major Investors who wish to purchase such unsubscribed shares.
(c) The closing of any sale pursuant to this Section 4.1(c) shall occur within the later of one hundred twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(d).
(d) If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five one hundred twenty (45120) day days period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(de) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); and (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing Preferred Stock to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Additional Purchasers pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. Subject In any transaction other than an open market transaction where Crown Life or GEIPPP II, as the case may be (the "Seller"), wishes to sell any or all of their respective Shares (the terms and conditions specified "Offered Shares") (except where such proposed sale is a result of an unsolicited bid to purchase all of the Seller's Shares, in which case this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has 4.5 shall not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter definedapply), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisionsthen:
(a) The Company shall the Seller will first deliver a notice by certified mail to Crown Life or GEIPPP II, as the case may be (“Notice”the "Other Party"), an invitation (the "Invitation") to make an offer in writing (the Participation Rights Holders stating (i) its bona fide intention "Offer to offer such Shares, (iiPurchase") the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Offered Shares.;
(b) Within fifteen (15) calendar the Other Party may make, within 10 business days after of delivery of the NoticeInvitation, each Participation Rights Holder may elect an Offer to purchase or obtain, at Purchase which shall specify the price and on the terms specified in upon which the Notice, up Other Party shall purchase the Offered Shares. The Offer to that portion of such Shares which equals the proportion Purchase will state that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that offer contained therein is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.irrevocable;
(c) The Company mayif the Other Party fails to make an Offer to Purchase within the time period specified in paragraph (b) above, during then this paragraph 4.5 shall no longer apply and the forty five (45) day period following the expiration Seller shall be free to sell any or all of the period provided in subsection 2.3(b) hereofOffered Shares thereafter, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable subject to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.Tag-Along Rights;
(d) The right of first offer If the Other Party makes an Offer to Purchase within the time period specified in this Section 2.3 paragraph (b) above, then the Seller shall have 90 days to sell the Offered Shares to a third party provided that such sale shall be carried out on the terms that are the same or that are no less favourable from a reasonable vendor’s perspective than the terms set forth in the Offer to Purchase;
(e) If the Seller does not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of complete a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4)paragraph (d) above, then the Seller shall sell its shares to the Other Party on the terms set forth in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted Offer to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase.
Appears in 1 contract
Samples: Inter Shareholder Agreement (Elephant & Castle Group Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among (i) itself, and (ii) its Affiliates; provided that each such Affiliate (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agremeent and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar days By notification to the Company within [***] after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred Stock) and full exercise Derivative Securities). At the expiration of all outstanding warrantssuch [***] period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day [***] period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of [***] of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five (45) day [***] period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) days [***] of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws and excluding any sale of New Securities pursuant to Subsection 1.3 of the Purchase Agreement, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate, among (i) itself, (ii) its Affiliates (and, in the case of CII, Permitted CII Transferees) and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership”, as such term is defined in Rule 13d-3 promulgated under the Exchange Act, of such Major Investor; provided, however, in each case that any such Affiliate or beneficial interest holder (x) be an “accredited investor” within the meaning of the Securities Act, (y) is not a Competitor or FOIA Party (except in the case of a Permitted CII Transferee), unless such party’s purchase of New Securities is otherwise consented to by the Board of Directors, and (z) agrees to enter into this Agreement and each of the Sixth Amended and Restated Voting Agreement and Sixth Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party (except in the case of CII or any Permitted CII Transferee) shall not be entitled to any rights as a Major Investor under Subsections 3.1, 3.2 and 4.1 hereof). Each time Notwithstanding the Company proposes fact that SMC apportions this right of first offer to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class one of its capital stock for sale beneficial interest holders and issuance such beneficial interest holder would be considered a Major Investor pursuant to this Agreement, such beneficial interest holder hereby grants all subsequent rights of first offer described in this Section 4.1 and held by the Company such beneficial interest holder back to SMC to exercise and apportion as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:it deems appropriate.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of Series A Preferred Stock, Series A-2 Preferred Stock, Series B Preferred Stock, Series B-2 Preferred Stock, Series C Preferred Stock, Series C-2 Preferred Stock, Series D Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsSeries A Preferred Stock, options Series A-2 Preferred Stock, Series B Preferred Stock, Series B-2 Preferred Stock, Series C Preferred Stock, Series C-2 Preferred Stock, Series D Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series A Preferred Stock, Series A-2 Preferred Stock, Series B Preferred Stock, Series B-2 Preferred Stock, Series C Preferred Stock, Series C-2 Preferred Stock, Series D Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series A Preferred Stock, Series A-2 Preferred Stock, Series B Preferred Stock, Series B-2 Preferred Stock, Series C Preferred Stock, Series C-2 Preferred Stock, Series D Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of one hundred twenty (120) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Seventh Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series D Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. Subject to The following provisions shall apply in (the terms and conditions specified in this Section 2.3, event of the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as intended sale of all or substantially all of LICENSEE’S assets:
(i) Cisco continues In the e\ent LICENSEE decides to hold at least 180,729 shares seek a purchaser of all or substantially all of the membership interests or One Hundred Percent (as adjusted for stock splits, stock dividends, reclassification and the like100%) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board assets of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined)LICENSEE, (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Notice”) but prior to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) the number expression of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of interest from any third party purchasers or at an additional closing thereunder. The Company pany potential purchaser, LICENSEE shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fullygive OWNER forty-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days written notice (the “INTENT TO SELL NOTICE1’) prior to entering into any discussions or negotiations with any such third party,
(ii) In the event LICENSEE receives unsolicited bona fide interest from a potential third party purchaser, LICENSEE may, but is not obligated, to give OWNER the INTENT TO SELL NOTICE prior to entering into any substantive discussions or negotiations with such third party. In the event LICENSEE chooses not to give OWNER such notice and LICENSEE thereafter receives a bona fide offer from such third party to purchase all or substantially all of the execution membership interests or assets of LICENSEE, as applicable, LICENSEE shall, at least forty-five (45) days prior to closing such sale, provide OWNER with written notice thereof. LICENSEE’S written notice of the bona fide offer shall detail the material terms of such bona fide offer, including, without limitation, the right provided hereunder shall be deemed price and other material commercial terms relevant to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewithLICENSEE (a “THIRD PARTY OFFER”).
(dB) Within five (5) business days of OWNER receiving an INTENT TO SELL NOTICE under Paragraph 21(A)(i) above or an INTENT TO SELL NOTICE or a THIRD PARTY OFFER under Paragraph 21 (A)(ii) above , OWNER shall have the right to request, and LICENSEE shall provide OWNER, in accordance with standard confidentiality provisions, full access to its books and records (including any valuations done by any investment bankers), its facilities, and its management, for the purposes of conducting due diligence (the “OWNER DUE DILIGENCE”). During the period ending thirty (30) days after LICENSEE has provided such access, OWNER shall have the right to make a bona fide offer to buy all or substantially all of LICENSEE’S membership interests or assets, as applicable (an “OWNER OFFER”) and LICENSEE must consider any such OWNER OFFER in good fail.
(C) In the event that LICENSEE declines to accept an OWNER OFFER, or, (ii) OWNER declines or fails to make an OWNER OFFER, LICENSEE will (hereafter be free to sell all of the membership interests or assets of LICENSEE. “
9. Except to the extent amended by this letter amendment, the License Agreement remains in full force and effect. The right parties agree that, except as otherwise provided in Paragraph 14.1 (iii), if at the end of first offer the Automatic Renewal Term, the License Agreement is not renewed for either Optional Term 1 or Optional Term 2, the License Agreement shall r.;main in full force and effect during the one year period ending on December 31,2007.
10. Xxxxxxx has been advised that Magla Products, LLC, a New Jersey Limited Liability Company is the successor in interest to Magi a Products, Inc. and Xxxxxxx hereby agrees that any reference to “Licensee” or “Magla” in (he License Agreement or t h i s Letter Amendment refers to and shall mean Magla Products, LLC.
11. Xxxxxxx hereby agrees that it has consented to all subcontractors used by Magla to manufacture the LICENSED ARTICLES as of the date of this Section 2.3 shall not be applicable to (i) Letter Amendment.. 12 The parties hereby agree that the issuance provisions of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8Paragraph 14(v) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect License Agreement shall not apply to any proposed sale of shares of country in South America or Central America. If the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; providedforegoing meels with your approval, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), please indicate in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by space provided below Very truly yours, Agreed to and accepted, this Section 2.329th day of September, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share2000. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”By: /s/ Xxxxxx Xxxxx Name: Xxxxxx Xxxxx Title: President
Appears in 1 contract
Right of First Offer. Subject to The following provisions shall apply in (he event of the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as inlended sale of all or substantially all of LICENSEE’S assets:
(i) Cisco continues In the e\ent LICENSEE decides to hold at least 180,729 shares seek a purchaser of all or substantially all of the membership interests or One Hundred Percent (as adjusted for stock splits, stock dividends, reclassification and the like100%) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board assets of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined)LICENSEE, (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Notice”) but prior to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) the number expression of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of interest from any third party purchasers or at an additional closing thereunder. The Company pany potential purchaser, LICENSEE shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fullygive OWNER forty-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days written notice (the “INTENT TO SELL NOTICE1’) prior to entering into any discussions or negotiations with any such third party,
(ii) In the event LICENSEE receives unsolicited bona fide interest from a potential third party purchaser, LICENSEE may, but is not obligated, to give OWNER the INTENT TO SELL NOTICE prior to entering into any substantive discussions or negotiations with such third party. In the event LICENSEE chooses not to give OWNER such notice and LICENSEE thereafter receives a bona fide offer from such third party to purchase all or substantially all of the execution membership interests or assets of LICENSEE, as applicable, LICENSEE shall, at least forty-five (45) days prior to closing such sale, provide OWNER with written notice thereof. LICENSEE’S written notice of the bona fide offer shall detail the material terms of such bona fide offer, including, without limitation, the right provided hereunder shall be deemed price and other material commercial terms relevant to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewithLICENSEE (a “THIRD PARTY OFFER”).
(dB) Within five (5) business days of OWNER receiving an INTENT TO SELL NOTICE under Paragraph 21(A)(i) above or an INTENT TO SELL NOTICE or a THIRD PARTY OFFER under Paragraph 21 (A)(ii) above , OWNER shall have the right to request, and LICENSEE shall provide OWNER, in accordance with standard confidentiality provisions, full access to its books and records (including any valuations done by any investment bankers), its facilities, and its management, for the purposes of conducting due diligence (the “OWNER DUE DILIGENCE”). During the period ending thirty (30) days after LICENSEE has provided such access, OWNER shall have the right to make a bona fide offer to buy all or substantially all of LICENSEE’S membership interests or assets, as applicable (an “OWNER OFFER”) and LICENSEE must consider any such OWNER OFFER in good fail.
(C) In the event that LICENSEE declines to accept an OWNER OFFER, or, (ii) OWNER declines or fails to make an OWNER OFFER, LICENSEE will (hereafter be free to sell all of the membership interests or assets of LICENSEE. “
9. Except to the extent amended by this letter amendment, the License Agreement remains in full force and effect. The right parties agree that, except as otherwise provided in Paragraph 14.1 (iii), if at the end of first offer the Automatic Renewal Term, the License Agreement is not renewed for either Optional Term 1 or Optional Term 2, the License Agreement shall r.;main in full force and effect during the one year period ending on December 31,2007.
10. Xxxxxxx has been advised that Magla Products, LLC, a New Jersey Limited Liability Company is the successor in interest to Magi a Products, Inc. and Xxxxxxx hereby agrees that any reference to “Licensee” or “Magla” in (he License Agreement or t h i s Letter Amendment refers to and shall mean Magla Products, LLC.
11. Xxxxxxx hereby agrees that it has consented to all subcontractors used by Magla to manufacture the LICENSED ARTICLES as of the date of this Section 2.3 shall not be applicable to (i) Letter Amendment.. 12 The parties hereby agree that the issuance provisions of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8Paragraph 14(v) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect License Agreement shall not apply to any proposed sale of shares of country in South America or Central America. If the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; providedforegoing meels with your approval, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), please indicate in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by space provided below Very truly yours, Agreed to and accepted, this Section 2.329th day of September, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share2000. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”By: /s/ Xxxxxx Xxxxx Name: Xxxxxx Xxxxx Title: President
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (Aa) each Major Holder, (B) Cisco Systems so long as In connection with (i) Cisco continues any permitted Transfer in accordance with Section 7.1(b)(4) above which requires the transferring Member to hold at least 180,729 shares provide the other Member with a right of first offer, or (ii) a Trigger Sale in accordance with Section 8.1 below which requires an Electing Member to provide the Other Member with a right of first offer, the transferring Member (hereinafter referred to as adjusted for stock splits, stock dividends, reclassification and the like“Offering Party”) shall give notice (the “First Offer Notice”) of Registrable Securities such proposed Transfer to the other Member (hereinafter referred to as the “Non-Offering Party”), which First Offer Notice shall include an offer to Transfer such direct or indirect Interest in the Company (hereinafter referred to as the “Offered Interest”) to the Non-Offering Party and/or its designee. The First Offer Notice shall set forth (i) the price that the Offering Party is then considering for the Transfer of such Offered Interest, net of any transaction costs that the Offering Party would bear in connection therewith (the “Offer Sale Price”) and (ii) the Company has not delivered written notice to Cisco any other material terms and conditions that the Board of Directors of Offering Party is then considering for such Transfer.
(b) The First Offer Notice shall be deemed a binding offer from the Company has made a Cisco Competitor Determination a right of first offer with respect Offering Party to future sales by the Company of Non-Offering Party whereby the Non-Offering Party (and/or its Shares (as hereinafter defined), (Cdesignee) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise shall have the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time (the Company proposes “First Offer Right”) to offer any additional shares of, or securities convertible into or exercisable elect to purchase the Offered Interest for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder Offer Sale Price in accordance with the following provisions:
provisions of this Section 7.8. The First Offer Right may be exercised by the Non-Offering Party at any time within forty-five (a45) The Company shall deliver a days after the giving of the First Offer Notice by giving notice by certified mail thereof (the “First Offer Exercise Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such SharesOffering Party; provided, (ii) that simultaneously with the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery giving of the First Offer Exercise Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears Non-Offering Party shall deliver to the aggregate number New York office of shares of Common Stock then outstanding and all shares of Common Stock issuablea national title insurance company, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion as escrow agent pursuant to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (eacha customary escrow agreement, a deposit (the “Fully-Exercising HolderFirst Offer Deposit”) of any other Participation Rights Holder’s failure in an amount equal to do likewise. During the ten five percent (105%) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by Offer Sale Price. For the Participation Rights Holders that is equal to the proportion that the number avoidance of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company maydoubt, during the forty such forty-five (45) day period following (the expiration “Exercise Period”), the Offering Party shall not Transfer the Offered Interest or any portion thereof.
(c) If the Non-Offering Party timely exercises the First Offer Right, the closing of the period provided purchase shall be on a date (the “First Offer Closing Date”) designated by the Non-Offering Party which is not more than seventy-five (75) days after the giving of the First Offer Exercise Notice and at a place designated by the Non-Offering Party in subsection 2.3(bNew York, New York. On the First Offer Closing Date:
(1) hereofThe Offering Party shall deliver to the Non-Offering Party (and/or its designee) a duly executed and acknowledged instrument of assignment transferring the Offered Interest of the Offering Party to the Non-Offering Party (and/or its designee) free and clear of all liens and encumbrances, offer which instrument shall contain surviving representations limited to the remaining unsubscribed due organization and authority of the Offering Party, that the Offering Party owns one hundred percent (100%) of the Offered Interest and the absence of liens and encumbrances on the Offered Interest and shall contain a provision indemnifying and holding the Non-Offering Party (and/or its designee) harmless from any loss, liability, cost or expense (including reasonable out-of-pocket attorneys’ fees) it may incur by reason of any breach of such representations (which indemnification shall be given or guaranteed jointly and severally by a creditworthy party reasonably acceptable to the Non-Offering Party);
(2) The Offering Party shall pay all (A) transfer, gains, stamp or similar taxes due in connection with the conveyance of the Offered Interest (but if the taxing authorities shall impose any such tax as a result of aggregating the Offered Interest with any Transfers of direct or indirect interests in the Non-Offering Member, each Member shall be responsible for the taxes attributable to its Transfer) and (B) fees and expenses payable, if any, to a Lender, servicers and rating agencies pursuant to the express terms of the Loan Documents;
(3) The Non-Offering Party shall pay or cause to be paid the Offer Sale Price to the Offering Party by wire transfer in immediately available funds;
(4) The Offering Party shall discharge of record all liens and encumbrances affecting the Offered Interest, and if the Offering Party fails to do so, the Non-Offering Party (and/or its designee) may use any portion of the Shares Offer Sale Price to pay and discharge any person such liens and/or encumbrances and any related expenses and adjourn the closing for such period as may be necessary for such purpose;
(5) All items of Company revenue and expense shall be apportioned between the Offering Party (or persons at a price not less than, and upon terms no more favorable to if the offeree than those specified Offering Party is selling an indirect interest in the Notice. If Company, such Offering Party’s Affiliate Member) and the Company does not enter into an agreement Non-Offering Party as of 11:59 p.m. on the day immediately preceding the First Offer Closing Date in accordance with the customs and practices usual in comparable transactions in proportion to their respective shares of Cash Flow for the sale of the Shares within such current calendar period, or if such agreement is not consummated within forty five (45) days of the execution thereofand, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition subject to the foregoing, Cash Flow and Capital Proceeds up to (but not including) the right First Offer Closing Date shall be distributed in accordance with the provisions of first offer in this Section 2.3 shall not be applicable with respect 3.1, and if the Offered Interest consists of a Member’s Membership Interest (as opposed to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuancean indirect interest), the Participation Rights Holder is not an “accredited investor,” Approved Accountant shall close the books of the Company as that term is then defined in Rule 501(a) under of the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”First Offer Closing Date;
Appears in 1 contract
Samples: Limited Liability Company Agreement (American Realty Capital New York Recovery Reit Inc)
Right of First Offer. Subject to the terms and conditions specified in this Section 2.37.2, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) Takeda and each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination Lender a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.37.2, Participation Rights Holder the term “Lender” includes any Affiliated Persons general partners and Affiliates of a Participation Rights Holder Lender. Takeda and a Participation Rights Holder who chooses each Lender shall be entitled to exercise apportion the right of first offer may designate as purchasers under such right hereby granted it among itself or and its Affiliated Persons, partners and Affiliates in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exchangeable or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (including, without limitation, any such shares or securities issued in connection with debt securities) (“Shares”), the Company shall first make an offering of such Shares to Takeda and each Participation Rights Holder Lender in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail in accordance with Section 8.5 (“Notice”) to Takeda and the Participation Rights Holders Lenders stating (i) its bona fide intention to offer such Shares, (ii) the number of such Shares to be offered, offered and (iii) the price and terms, if any, terms upon which it proposes to offer such Shares.
(b) Within fifteen By written notification received by the Company within ten (1510) calendar days after delivery the giving of the Notice, Takeda and each Participation Rights Holder Lender may elect to purchase or obtainpurchase, at the price and on the terms specified in the Notice, up to that portion of such Shares which that equals the following: (i) with respect to Takeda, fifteen percent (15%) of such Shares; and (ii) with respect to each Lender, such Lender’s respective pro rata portion of eighty five (85%) of such Shares determined in the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all principal outstanding shares of Preferred Stock then under the Note(s) held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder Lender bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, principal outstanding under the Notes held by all such Fully Exercising Investors who desire the Lenders; provided, that if Takeda does not elect to purchase the full amount of Shares for to which Participation Rights Holders did it is entitled to purchase under this Section 7.2(b)(i), then each Lender shall have a right to elect to purchase its pro rata portion of any such remaining Shares not subscribepurchased by Takeda pursuant to the provisions of this Section 7.2(b)(ii).
(c) The If all Shares that Takeda and the Lenders are entitled to obtain pursuant to Section 7.2(b) of this Agreement are not elected to be obtained as provided in Section 7.2(b) of this Agreement, the Company may, during the forty five ninety (4590) day period following the expiration of the period provided in subsection 2.3(bSection 7.2(b) hereofof this Agreement, offer the remaining unsubscribed portion of the such Shares to any person Person or persons Persons at a price not less thanthan that, and upon terms no more favorable to the offeree than those those, specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five sixty (4560) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to Takeda and the Participation Rights Holders Lenders in accordance herewith.
(d) The right of first offer in this Section 2.3 7.2 shall not be applicable to (i) the issuance or sale of securities excluded from shares of Common Stock (or options therefor) (appropriately adjusted for any stock split, dividend, combination or other recapitalization) to employees, directors, consultants and other service providers for the definition primary purpose of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of soliciting or retaining their services pursuant to plans or agreements approved by the Company’s Amended and Restated Certificate of IncorporationBoard; (ii) the assignment by issuance of securities in the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stockInitial Public Offering; or (iii) the issuance of securities that Participation Rights Holders holding pursuant to the conversion or exercise of convertible or exercisable securities; (iv) the issuance of securities in connection with a majority bona fide business acquisition by the Company, whether by merger, consolidation, sale of assets, sale or exchange of stock or otherwise; (v) the issuance of Conversion Shares upon conversion of the Registrable Notes (but, for the purposes of clarity, not the Equity Securities held by Participation Rights Holders agree in writing to exclude from that trigger the provisions issuance of this Section 2.3the Conversion Shares); providedor (vi) the issuance of stock, however, notwithstanding any such waiver (warrants or waiver of such provisions other securities or rights pursuant to Section 3.4), in any equipment leasing arrangement or debt financing arrangement; provided such issuances are approved by the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to Board and (except for the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata shareInitial Public Offering) are primarily for non-equity financing purposes. In addition to the foregoing, the right of first offer in this Section 2.3 7.2 shall not be applicable with respect to any Participation Rights Holder and Lender in any particular subsequent securities issuance, offering of Shares if (i) at the time of such subsequent securities issuanceoffering, the Participation Rights Holder Lender is not an “accredited investor,” as that term is then defined in Rule 501(a) under of the Securities Act, Act and (ii) such subsequent securities issuance offering of Shares is otherwise being offered only to accredited investors.
(e) The rights provided in this Section 7.2 may not be assigned or transferred by any Lender; provided, however, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the a Lender that is a venture capital fund, private equity investor, investment company or investment advisor may assign or transfer such rights to its Affiliates.
(f) The right of first offer in this Section 7.2, including notice with respect thereto, applicable to Takeda may be waived by Takeda with the written consent of Takeda. The right of first offer in this Section 7.2, including notice with respect thereto, may be waived by all Lenders with the written consent of the Requisite Noteholders; provided, in the event any Lender consents to the waiver of the provisions of this Section 7.2 with respect to any offering of Shares by the Company and actually purchases any such Participation Rights Investor Shares in such offering, then each other Lender who did not consent to such waiver shall be permitted to participate in any other securities issuance”such offering (which may, at the Company’s option, be in a subsequent closing of such offering on substantially the same terms and conditions) on a pro rata basis (based on the level of participation of the Lender purchasing the largest portion of such Lender’s pro rata share). Takeda’s and the Requisite Noteholders’ right to waive the provisions of this Section 7.2 shall be independent of one another.
(g) The covenants set forth in this Section 7.2 shall terminate and be of no further force or effect upon (i) the consummation of the Initial Public Offering, (ii) when the Company first becomes subject to the periodic reporting requirements of Sections 12(g) or 15(d) of the Exchange Act and (iii) upon the consummation of a Corporate Transaction, whichever event shall first occur.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3Subsection 3.1 and applicable securities laws, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time if the Company proposes to offer or sell any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”)New Securities, the Company shall first make an offering of offer such Shares New Securities to each Participation Rights Holder in accordance with the following provisions:Investor.
(a) The Company shall deliver a give written notice by certified mail (“the "Offer Notice”") to the Participation Rights Holders Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offeredoffered to the Investor, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder the Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder Investor bears to the total number of shares of Common Stock issued of the Company then outstanding unless otherwise agreed by the Board of Directors. The closing of any sale pursuant to this Subsection 3.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and held, or issuable upon conversion the date of Preferred Stock then held, by all such Fully Exercising Investors who desire initial sale of New Securities pursuant to purchase Shares for which Participation Rights Holders did not subscribeSubsection 3.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 3.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of date that the period provided in subsection 2.3(b) hereofOffer Notice is given, offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investor in accordance herewithwith this Subsection 3.1.
(d) The right of first offer in this Section 2.3 Subsection 3.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Exempted Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue Holder. The Holder shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Personshereby granted to it, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of among (i) itself and (ii) its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Affiliates.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders Holder, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights the Holder may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights the Holder bears to the aggregate number of (including all shares of Common Stock then outstanding and all issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of any Derivative Securities then held by the Holder (including the Warrant but not including any shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and acquired other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal than pursuant to the proportion that the number terms of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder this Agreement)) bears to the total number of shares of Common Stock issued of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Derivative Securities). The closing of any sale pursuant to this Subsection 3.1(b) shall occur within the later of 120 days of the date that the Offer Notice is given and held, or issuable upon conversion the date of Preferred Stock then held, by all such Fully Exercising Investors who desire initial sale of New Securities pursuant to purchase Shares for which Participation Rights Holders did not subscribeSubsection 3.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired by the Holder as provided in Subsection 3.1(b), the Company may, during the forty five (45) 120 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 3.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Holder in accordance herewithwith this Subsection 3.1.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 Subsection 3.1 shall not be applicable to an Exempt Issuance or with respect to any Participation Rights the Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that such term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”.
Appears in 1 contract
Right of First Offer. Subject If any Trust Holder (each such Trust Holder, an "Indirect Offeror") proposes to Transfer Trust Units to any Person other than (u) in connection with a Permitted Excluded Transfer, (v) pursuant to the terms and conditions specified in this Section 2.3, exercise of the Company hereby grants the participation rights Co-Sale Rights set forth in this Section 2.3 to (A) each Major Holder3.4 of the Members Agreement, (Bw) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the terms of the Indemnity Agreement and Section 4.03(c) hereof, (x) in respect of Forfeited Trust Units or Default Trust Units in accordance with the terms of Article IX hereof, (y) in respect of the Indemnity Subscription Right in accordance with the terms of Section 4.03(c) hereof or (z) in connection with a request from a Correction Requesting Trust Holder pursuant to Section 10.04 hereof, then the following provisionsprocedures shall be followed in accordance with this Agreement and the Members Agreement:
(a) The Company shall Indirect Offeror shall, before such Transfer, deliver to CEH LLC and the Investors (other than the Trust) (the "Indirect Offerees") a notice by certified mail written request for an offer (“Notice”the "Indirect Offer Request") to purchase the Participation Rights Holders stating Trust Units that the Indirect Offeror proposes to Transfer (ithe "Indirect Offered Units"). Each Indirect Offeree shall have the right and option to notify the Indirect Offeror, in a writing (the "Indirect Offer") delivered within three (3) Business Days after the date of its bona fide intention receipt of the Indirect Offer, of its offer to offer such Sharespurchase all, (ii) but not less than all, of the number of such Shares to be offered, and (iii) Indirect Offered Units at the cash purchase price and terms, if any, upon which it proposes to offer such Shareson the terms and conditions stated in the Indirect Offer. Each Indirect Offer shall remain open and irrevocable for a period of five (5) Business Days from the date of its receipt by the Indirect Offeror (the "Indirect Offer Period").
(b) Within fifteen If one or more Indirect Offers have been timely received, then the Indirect Offeror shall have the right and option to accept the Indirect Offer containing the highest offered purchase price and/or most favorable other terms and conditions, as determined by the Indirect Offeror in good faith (15) calendar days after delivery the "High Offer"), which may reflect discussions between the Indirect Offeree and the Indirect Offeror, by so notifying the applicable Indirect Offeree in a writing (the "Indirect Offer Acceptance"), with copies to CEH LLC and the Trust, delivered prior to the expiration of the NoticeIndirect Offer Period; provided, each Participation Rights Holder may elect to that if more than one Indirect Offer offers the same purchase or obtain, at the price and on other terms and conditions and each such offer is a High Offer, then the terms specified in Indirect Offeror, if choosing to accept any Indirect Offer, shall accept any High Offer made by CEH LLC, and, if no High Offer has been made by CEH LLC, shall have the Notice, up right and option to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of accept any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeHigh Offers.
(c) The Company may, during Within 15 days of receipt by the forty five (45) day period following the expiration Trust of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion copy of the Shares Indirect Offer Acceptance and in lieu of the Indirect Offeror Transferring the Indirect Offered Units, the Trust shall Transfer to any person CEH LLC or persons at a price not less thanthe other Indirect Offeree, and upon terms no more favorable as the case may be, against receipt of payment therefor, Class A Units of CEH LLC in an amount corresponding to the offeree Indirect Offered Units that CEH LLC or the other Indirect Offeree agreed to purchase. Delivery of certificates or other instruments evidencing Class A Units of CEH LLC in an amount corresponding to the Indirect Offered Units duly endorsed for transfer and free and clear of all liens, claims and other encumbrances (other than those specified arising hereunder and those attributable to actions by the purchasers thereof) shall be made on such date against payment in the Notice. If the Company does not enter into an agreement for the sale cash of the Shares within purchase price therefor. At such periodclosing, or if such agreement is not consummated within forty five (45) days all of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered parties to the Participation Rights Holders in accordance herewithtransaction shall execute such additional documents as are otherwise necessary or appropriate. The Trust shall promptly use the proceeds received by it at such closing to redeem the Indirect Offered Units.
(d) The right of first offer in this Section 2.3 shall If an Indirect Offer has not be applicable been timely delivered, or if an Indirect Offer Acceptance has not been timely delivered, then the Indirect Offeror may Transfer to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IVany Person all, Section (B)(4)(d)(i)(B)(1)-(8) but not less than all, of the Company’s Amended Trust Units that were subject to the Indirect Offer Request on terms and Restated Certificate conditions no more favorable to such Person than are described in a timely received Indirect Offer (or, if more than one, in the High Offer), for a period of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares 60 days after expiration of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from Indirect Offer Period. If such Transfer is not made within such 60-day period, the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders 10.02 shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable again become effective with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”proposed Transfer.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares ofamong (i) itself, any class of and (ii) its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Affiliates.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly issuable or indirectly, issued upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder Major Investor (excluding any Common Stock issued upon conversion of the Series A Preferred Stock pursuant to the “Special Mandatory Conversion” provisions in the Certificate of Incorporation) bears to the aggregate number of shares of total Common Stock then outstanding and all shares of Common Stock issuable, directly issuable or indirectly, issued upon conversion of all outstanding shares of Preferred Stock then held by all Major Investors (assuming full exerciseexcluding any Common Stock issued upon conversion of the Series A Preferred Stock pursuant to the “Special Mandatory Conversion” provisions in the Certificate of Incorporation). At the expiration of such twenty (20) day period, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issuable or issued and held, or issuable upon conversion of Preferred Stock then held, held by such Fully-Fully Exercising Holder Investor (excluding any Common Stock issued upon conversion of the Series A Preferred Stock pursuant to the “Special Mandatory Conversion” provisions in the Certificate of Incorporation) bears to the total number of shares of Common Stock issuable or issued and held, or issuable upon conversion of Preferred Stock then held, held by all such Fully Exercising Investors (excluding any Common Stock issued upon conversion of the Series A Preferred Stock pursuant to the “Special Mandatory Conversion” provisions in the Certificate of Incorporation) who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockQualified Public Offering; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series A Preferred Stock pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Aerovate Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in this Section 2.34.1, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 such Holder holds not less than 150,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and held thereby (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination "RIGHTHOLDER"), a right of first offer with respect to future sales by the Company of its Shares New Securities (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.34.1, Participation Rights Holder the term Rightholder includes any Affiliated Persons partners, shareholders or affiliates of a Participation Rights Holder and a Participation Rights Holder who chooses the Rightholder. The Rightholder shall be entitled to exercise apportion the right of first offer may designate as purchasers under such right hereby granted among itself or and its Affiliated Personspartners, shareholders and affiliates in such proportions as it deems appropriate. Each time .
(a) In the event the Company proposes to issue New Securities, it shall give the Rightholder written notice (the "NOTICE") of its intention stating (i) a description of the
(b) Within forty-five (45) days after the Notice is given (in accordance with Section 5.5), the Rightholder may elect to purchase, at the price specified in the Notice, up to the number of shares of the New Securities proposed to be issued that the Rightholder has the right to purchase as specified in the Notice. An election to purchase shall be made in writing and must be given to the Company within such forty-five (45)-day period (in accordance with Section 5.5). The closing of the sale of New Securities by the Company to the participating Rightholder upon exercise of its rights under this Section 4.1 shall take place simultaneously with the closing of the sale of New Securities to third parties.
(c) The Company shall have ninety (90) days after the last date on which the Rightholder's right of first offer lapsed to enter into an agreement (pursuant to which the sale of New Securities covered thereby shall be closed, if at all, within forty-five days from the execution thereof) to sell the New Securities which the Rightholder did not elect to purchase under this Section 4.1, at or above the price and upon terms not materially more favorable to the purchasers of such securities than the terms specified in the initial Notice given in connection with such sale. In the event the Company has not entered into an agreement to sell the New Securities within such ninety day period (or sold and issued New Securities in accordance with the foregoing within forty-five days from the date of said agreement), the Company shall not thereafter issue or sell any additional New Securities without first offering such New Securities to the Rightholder in the manner provided in this Section 4.1.
(d) (i) "NEW SECURITIES" shall mean any shares of, or securities convertible into or exercisable for any shares of, any class of its the Company's capital stock for sale and issuance stock; provided that "New Securities" does not include: (A) securities issued pursuant to the acquisition of another business entity by the Company as a primary issuance (“Shares”)by merger, purchase of substantially all of the assets of such entity, or other reorganization whereby the Company shall first make an offering owns not less than a majority of the voting power of such Shares entity; (B) shares, or options to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such Sharespurchase shares, (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at Company's Common Stock and the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, issuable upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrantssuch options, options and other rights issued pursuant to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for arrangement approved by the Participation Rights Holders that is equal Board of Directors to the proportion that the number of shares of Common Stock issued employees, officers and helddirectors of, or issuable upon conversion of Preferred Stock then heldconsultants, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, advisors or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or other persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereofperforming services for, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
Company, (dC) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock's Common Stock or Preferred Stock of any series issued in connection with any stock split, stock dividend or recapitalization of the Company; (D) Common Stock issued upon exercise of warrants, options or (iii) convertible securities if the issuance of such warrants, options or convertible securities that Participation Rights Holders holding was a majority result of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions exercise of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in granted under this Section 2.3 shall not be applicable 4.1 or was subject to the right of first offer granted under this Section 4.1; (E) capital stock or warrants or options for the purchase of shares of capital stock issued by the Company to a lender in connection with respect any loan or lease financing or technology acquisition transaction approved by the Board of Directors of the Company; and (F) securities sold to any Participation Rights Holder the public in an offering pursuant to a registration statement filed with the Securities and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) Exchange Commission under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”.
Appears in 1 contract
Samples: Rights Agreement (Accelgraphics Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such 20 day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) In the event that the rights of a Major Investor to purchase New Securities under this Section 4.1 are waived with respect to a particular offering of New Securities without such Major Investor’s prior written consent (a “Waived Investor”) and any Major Investor that participated in waiving such rights actually purchases New Securities in such offering, then the Company shall grant, and hereby grants, each Waived Investor the right to purchase, in a subsequent closing of such issuance on substantially the same terms and conditions, the same percentage of its full pro rata share of such New Securities as the highest percentage of any such purchasing Major Investor.
(e) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Design Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Personshereby granted to it, in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as a primary issuance an “Investor” under each such agreement (“Shares”provided that any Competitor or FOIA Party shall not be entitled to any rights as an Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section Exempted Securities (B)(4)(d)(i)(B)(1)-(8) of as defined in the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Series B Preferred Stock pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such 20 day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series A Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series A Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series A-1 Preferred Stock to Additional Purchasers pursuant to Section 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; provided4.1, howeverthe Company may elect to give notice to the Major Investors within 30 days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have 20 days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Section 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Invea Therapeutics, Inc)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates, (iii) in the Company proposes case of Columbia, Osage and (iv) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held by such Major Investor but excluding any Common Stock issued upon conversion of all outstanding shares of the Series B Preferred Stock pursuant to the “Special Mandatory Conversion” provisions of the Certificate of Incorporation) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held by such Fully Exercising Investor (excluding any Common Stock issued upon conversion of the Series B Preferred Stock then held, by such Fully-Exercising Holder pursuant to the “Special Mandatory Conversion” provisions of the Certificate of Incorporation) bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or (iii) the issuance of securities that Participation Rights Holders holding a majority Series B Preferred Stock to Additional Purchasers pursuant to Subsection 1.3 of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from Purchase Agreement; and (iv) the provisions issuance of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), Series B Preferred Stock in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if Milestone Closing (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement).
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of shall first offer with respect such New Securities to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor. An Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue shall be entitled to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1 and 3.2 or as an Investor under Section 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Series AA Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Series AA Preferred Stock and any other Derivative Securities then held by such Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such 20-day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderInvestor’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Series AA Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Series AA Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series AA Preferred Stock to Additional Purchasers pursuant to Section 1.3 of the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; provided4.1, howeverthe Company may elect to give notice to the Investors within 30 days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Investor shall have 20 days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Investor, maintain such Investor’s percentage-ownership position, calculated as set forth in Section 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”New Securities.
Appears in 1 contract
Samples: Investors' Rights Agreement (Sensei Biotherapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement, each of even date herewith, among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Major Investor holding the fewest number of shares of Preferred Stock and any other Derivative Securities and provided that the Company shall first make an offering of such Shares not be obligated to each Participation Rights Holder in accordance with the following provisions:offer or sell any New Securities to any person or entity that is a Sanctioned Party.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20)-day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day 10)-day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five ninety (45) day 90)-day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Series C Preferred Stock pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Purchase Agreement.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Bicara Therapeutics Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner agrees to offer enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement (each as defined under the Purchase Agreement) of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any additional shares of, or securities convertible into or exercisable for Competitor shall not be entitled to any shares of, any class of its capital stock for sale and issuance by the Company rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:shares of Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred StockDerivative Securities). At the expiration of such twenty (20) and full exercise of all outstanding warrantsday period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of IncorporationCertificate); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of Common Stock issued in the Company’s capital stockIPO; or and (iii) the issuance of securities that Participation Rights Holders holding a majority shares of Series D Preferred Stock to Additional Purchasers pursuant to the Registrable Securities held by Participation Rights Holders agree Purchase Agreement.
(e) Notwithstanding any provision hereof to the contrary, in writing to exclude from lieu of complying with the provisions of this Section 2.3; providedSubsection 4.1, howeverthe Company may elect to give notice to the Major Investors within thirty (30) days after the issuance of New Securities. Such notice shall describe the type, notwithstanding any price, and terms of the New Securities. Each Major Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities that would, if purchased by such waiver (or waiver Major Investor, maintain such Major Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such provisions pursuant to Section 3.4), in New Securities. The closing of such sale shall occur within sixty (60) days of the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative date notice is given to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Major Investors.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Cytek BioSciences, Inc.)
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.37.1, Participation Rights Holder includes if the Corporation proposes to issue, offer or sell any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses New Securities, the Corporation shall first offer to exercise sell such New Securities to each Major Stockholder. A Major Stockholder shall be entitled to apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time appropriate among (a) itself and (b) its Affiliates; provided that each such Affiliate (x) is not a Competitor and (y) agrees to deliver a Joinder Agreement such that such Affiliate shall be bound by all the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class terms and conditions of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:this Agreement.
(a) The Company Corporation shall deliver a give written notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Stockholder, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, offered and (iii) the price and terms, if any, any terms and conditions upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Corporation within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Stockholder may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock Shares then held by such Participation Rights Holder Major Stockholder (including all Shares then issuable (directly or indirectly) upon conversion or exercise of any Derivative Securities then held by such Major Stockholder) bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock total Shares (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full or exercise of all outstanding warrantsDerivative Securities then outstanding) held by all Major Stockholders. At the expiration of such twenty (20) day period, options and other rights the Corporation shall promptly notify each Major Stockholder that elects to purchase or acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares New Securities available to it (each, a “Fully-Fully Exercising HolderStockholder”) of any other Participation Rights HolderMajor Stockholder’s failure to do likewise. During the ten (10) day period commencing after receipt of the Corporation has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Stockholder may, by giving notice to obtain the Corporation, elect to purchase or acquire, in addition to the amount of New Securities specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Stockholders were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Stockholders which is equal to the proportion that the number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion or exercise of Preferred Stock any Derivative Securities then held, held by such Fully-Fully Exercising Holder Stockholder bears to the total number of shares of Common Stock Shares issued and held, or issuable (directly or indirectly) upon conversion or exercise of Preferred Stock any Derivative Securities then held, held by all such Fully Exercising Investors Stockholders who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed portion of the New Securities. The closing of any sale pursuant to this Section 7.1(b) shall occur within the later of forty (40) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 7.1(c).
(c) The Company If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 7.1(b), the Corporation may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 7.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company Corporation does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five ninety (4590) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Stockholders in accordance herewith.
(d) The right of first offer in with this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”7.1.
Appears in 1 contract
Samples: Stockholders Agreement (WeWork Inc.)
Right of First Offer. Subject The Parties agree to grant each other the following rights of first offer:
(i) None of the Parties shall sell, assign, transfer or alienate their Shares and/or their interest in the Ownership and Voting Trust, other than those subject to the Public Placement, without first offering them for sale to the other Party at the same price and under the same terms and conditions specified in this Section 2.3, that such selling Party proposes to offer to a third party. The offer shall refer to the Company hereby grants total number of such Shares owned by the participation rights selling Party.
(ii) Such offer of sale with respect to such Shares shall be made by the selling Party (the “Offeror”) to the other Party (the “Offeree”) by written notice setting forth the decision of the selling Party to sell the Shares and the price terms and form of payment relating to such offer to sell.
(iii) In the event the Offeree decides not to exercise its right of first offer as set forth in this Section 2.3 paragraph within sixty (60) days from the receipt of the offer to sell, the Offeror, within the following ninety (A90) each Major Holderdays, (B) Cisco Systems so long as (i) Cisco continues may offer and sell such Shares to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification a third party on the same terms and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco conditions that the Board of Directors Shares were offered to the Offeree or on such terms and conditions that are not more favorable to the third party than those offered to the Offeree and informing the future buyer of the Company has made a Cisco Competitor Determination a right Shares that it shall be obligated to comply with the provisions of first offer with respect this Shareholders Agreement.
(iv) If the Offeror is unable to future sales by the Company of sell its Shares to a third party within the period and in accordance with the provisions set forth in the preceding subparagraph (as hereinafter definediii), (C) each X. Xxxx Price Investor and Fidelity Investorthe Offeror may not sell, so long as assign, transfer or alienate such Shares without first again complying with the X. Xxxx Price Investors and Fidelity Investors, respectively, continue procedures relating to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) exercise of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise the right of first offer may designate as purchasers under such set forth in paragraph (c) of Clause Fifth of this Shareholders Agreement.
(v) In the event the Offeree exercises its right itself or its Affiliated Persons, of first offer within the sixty (60) days period set forth in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance preceding subparagraph (“Shares”iii), the Company Offeree shall first make an offering give written notice of such Shares to each Participation Rights Holder in accordance with the following provisions:
(a) The Company shall deliver a notice by certified mail (“Notice”) decision to the Participation Rights Holders stating (i) its bona fide intention Offeror during such period, in which case the Offeror shall sell to offer such Shares, (ii) the number of such Offeree the Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears and conditions offered to the aggregate number of shares of Common Stock then outstanding Offeree in accordance with the preceding subparagraph (ii).
(vi) The sale and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion purchase of the Shares between Offeror and Offeree shall take place in Santiago, Chile, within the sixty (60) days period after the date of exercise of the right of first offer set forth in this Clause. The following events shall occur at such date:
[a] The Offeror shall provide the Offeree with a stock transfer in respect of the Shares duly executed before a Notary Public or two witnesses of legal age, as well as the corresponding Certificate for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal Shares sold. [b] The Offeror shall represent in writing to the proportion Offeree that it is the sole, absolute and exclusive owner of the Shares and that such Shares are free from any prohibition, lien, attachment or litigation. [c] The Offeree shall pay the price set forth in the offer for the Shares. [d] The Parties shall take all the acts necessary to guarantee that the number Offeree receives title to the Shares subject of shares the offer, as well execute all of Common Stock issued the necessary documents to settle and held, or issuable upon conversion close the transfer of Preferred Stock then heldsuch Shares, by such Fully-Exercising Holder bears to making the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribecorresponding entries in the corresponding Shareholders’ Records.
(cvii) The Company mayIf, during the forty five (45) day period following the expiration of after the period provided set forth in subsection 2.3(b) hereofthe preceding subparagraph (vi), offer the remaining unsubscribed portion sale and purchase of the Shares has not taken place because of a reason chargeable to any person one of the Parties, the diligent Party may demand specific performance of the corresponding obligation plus the payment of a penalty in an amount in Pesos equal to US$10,000,000 for each month or persons at partial month of delay.
(viii) If the Offeree does not accept an offer pursuant to paragraph (c) of Clause Fifth of this Shareholders Agreement and the Offeror sells its Shares to a price not less thanthird party, and such sale shall be conditioned upon terms no more favorable the third party agreeing to be subject to the offeree than those specified provisions of this Shareholders Agreement and the Master Agreement, as the case may be, as a successor to all of the rights and obligations of the seller of the Shares, which agreement shall be provided for in writing in the Notice. If the Company does not enter into an corresponding sale and purchase agreement for the Shares. In the event the sale of the Shares within such period, or if such agreement to a third party is not consummated within forty five (45) days of the execution thereofclosed, the right provided hereunder Offeror shall be deemed freed from any liability with respect to be revived the Shareholders Agreement and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewithconsidered a Party hereto.
(dix) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) acceptance of the Company’s Amended and Restated Certificate offers of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions Shares pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders paragraph shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”unconditional.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.32.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of among (i) itself and (ii) its capital stock for sale and issuance by the Company as a primary issuance (“Shares”), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:Affiliates.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Series A Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock Derivative Securities then held, held by such Fully-Exercising Holder Major Investor) bears to the total number of shares of Common Stock issued and heldof the Company then outstanding (assuming full conversion and/or exercise, or issuable upon conversion as applicable, of all Series A Preferred Stock and other Derivative Securities then held, by all such Fully Exercising Investors who desire outstanding). The closing of any sale pursuant to purchase Shares for which Participation Rights Holders did not subscribethis Section 2.1(b) shall occur within the later of one hundred eighty (180) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 2.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 2.1(b), the Company may, during the forty five one hundred eighty (45180) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 2.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares minimum amount of New Securities to be sold within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 2.1.
(d) The right of first offer in this Section 2.3 2.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”Exempted Securities.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions -------------------- specified in this Section 2.33.1, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination Investor a right of first offer with respect to future sales by the Company of its Shares New Securities (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.33.1, Participation Rights Holder the term Major Investor includes any Affiliated Persons partners, shareholders or affiliates of an Investor. Subject to Section 3.1(f) below, a Participation Rights Holder and a Participation Rights Holder who chooses Major Investor shall be entitled to exercise apportion the right of first offer may designate as purchasers under such right hereby granted among itself or and its Affiliated Personspartners, shareholders and affiliates in such proportions as it deems appropriate. Each time .
(a) In the event the Company proposes to issue New Securities, it shall give each Major Investor written notice (the "Notice") of its intention stating (i) a description of the New Securities it proposes to issue, (ii) the number of shares of New Securities it proposes to offer, (iii) the price per share at which, and other terms on which, it proposes to offer such New Securities and (iv) the number of shares that the Major Investor has the right to purchase under this Section 3.1, based on the Major Investor's Percentage (as defined in Section 3.1(d)(ii)).
(b) Within twenty (20) days after the Notice is given (in accordance with Section 4.5), the Major Investor may elect to purchase, at the price and on the terms specified in the Notice, up to the number of shares of the New Securities proposed to be issued that the Major Investor has the right to purchase based on the Major Investor's percentage. An election to purchase shall be made in writing and must be given to the Company within such twenty (20) day period (in accordance with Section 4.5). The Company shall promptly, in writing, inform each Major Investor that purchases all the New Securities available to it (each, a "Fully-Exercising Investor") of any additional other Major ------------------------- Investor's failure to do likewise. During the ten (10)-day period commencing after receipt of such information, each Fully-Exercising Investor shall be entitled to obtain that portion of the New Securities for which Major Investors were entitled to subscribe but which were not subscribed for by the Major Investors that is equal to the Major Investor's Percentage. The closing of the sale of New Securities by the Company to the participating Major Investor upon exercise of its rights under this Section 3.1 shall take place simultaneously with the closing of the sale of New Securities to third parties.
(c) The Company shall have forty-five (45) days after the last date on which the Major Investors' right of first offer lapsed to enter into an agreement (pursuant to which the sale of New Securities covered thereby shall be closed, if at all, within thirty (30) days from the execution thereof) to sell the New Securities which the Major Investors did not elect to purchase under this Section 3.1, at or above the price and upon terms not materially more favorable to the purchasers of such securities than the terms specified in the initial Notice given in connection with such sale. In the event the Company has not entered into an agreement to sell the New Securities within such forty-five (45) day period (or sold and issued New Securities in accordance with the foregoing within thirty (30) days from the date of said agreement), the Company shall not thereafter issue or sell any New Securities without first offering such New Securities to the Major Investors in the manner provided in this Section 3.1.
(d) (i) "New Securities" shall mean any shares of, or securities convertible into or exercisable for any shares of, any class of its the Company's capital stock for sale stock; provided that "New Securities" does not include: (i) the Series A, Series B, Series C, Series D, Series E or Series F Preferred Stock authorized or outstanding as of the date hereof, issuable upon exercise of warrants outstanding on the date hereof, or issued under the Series F Agreement, or the Common Stock issuable upon conversion thereof; (ii) up to 100,000 shares of Series F Preferred Stock issuable upon the exercise of the warrants (including the F Warrant) to purchase Series F Preferred Stock issued to vendors, lessors and issuance lenders at an exercise price per share of not less than $8.53884, or the Common Stock issuable upon conversion thereof (which warrants are approved by the Board of Directors of the Company), (iii) securities issued pursuant to the acquisition of another business entity by the Company as a primary issuance (“Shares”)by merger, purchase of substantially all of the assets of such entity, or other reorganization whereby the Company shall first make an offering owns not less than a majority of the voting power of such Shares to each Participation Rights Holder in accordance with the following provisions:
entity; (aiv) The Company shall deliver a notice by certified mail (“Notice”) to the Participation Rights Holders stating (i) its bona fide intention to offer such Shares, (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.
(b) Within fifteen (15) calendar days after delivery of the Notice, each Participation Rights Holder may elect to purchase or obtain, at the price and on the terms specified in the Notice, up to that portion of such Shares which equals the proportion that the number of 16,570,128 shares of Common Stock issuable, directly (or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate higher number of shares as is approved by the board of Common directors, the holders of at least a majority of the outstanding Series C, Series D, Series E and Series F Preferred, voting together) issued or issuable to officers, directors, employees and consultants of the corporation, since the date of incorporation, pursuant to the corporation's 1997 Stock then outstanding and all Plan; (v) up to 600,000 shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Series F Preferred Stock (assuming full exercise, and conversion including shares issued upon the exercise of warrants to Common Stock, of all outstanding warrants, options and other rights to acquire purchase Series F Preferred Stock) and full exercise granted or issued in connection with the acquisition or licensing of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers patents or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it (each, a “Fully-Exercising Holder”) of any other Participation Rights Holder’s failure to do likewise. During the ten (10) day period commencing after receipt of such information, each Fully-Exercising Holder shall be entitled to obtain that portion of the Shares for which Participation Rights Holders were entitled to subscribe but which were not subscribed for by the Participation Rights Holders that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribe.
(c) The Company may, during the forty five (45) day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within forty five (45) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Participation Rights Holders in accordance herewith.
(d) The right of first offer in this Section 2.3 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporationpatent rights; (iivi) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock's Common Stock or Preferred Stock of any series issued in connection with any stock split, stock dividend or recapitalization of the Company; (vii) Common Stock issued upon exercise of warrants, options or (iii) convertible securities if the issuance of such warrants, options or convertible securities that Participation Rights Holders holding was a majority result of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions exercise of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in granted under this Section 2.3 shall not be applicable with respect 3.1 or was subject to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor first offer granted under this Section 3.1; and (viii) securities sold to participate the public in any other securities issuance”an offering pursuant to a registration statement filed with the Securities and Exchange Commission under the Act.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants the participation rights set forth in this Section 2.3 to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.34.1, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder applicable securities laws and a Participation Rights Holder who chooses to exercise the right of first offer may designate 2015 SPA (as purchasers under such right itself or its Affiliated Personsdefined below), in such proportions as it deems appropriate. Each time if the Company Corporation proposes to offer or sell any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company as a primary issuance (“Shares”)New Securities, the Company Corporation shall first make an offering of offer such Shares New Securities to each Participation Rights Holder in accordance with the following provisions:DTV Holding.
(a) The Company Corporation shall deliver a promptly give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders DTV Holding, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and offered or (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Corporation within ten (1510) calendar days Business Days after delivery of the NoticeOffer Notice is received, each Participation Rights Holder DTV Holding may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares which New Securities that equals the proportion that the number Common Stock then held by DTV Holding as it bears to the total Common Stock then outstanding among all Stockholders (assuming full conversion and/or exercise, as applicable, of all other securities or rights convertible into, or exchangeable for (in each case, directly or indirectly), Common Stock, including Options and Convertible Securities). If DTV Holding elects to purchase or acquire all the shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of shares of Common Stock then outstanding and all shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock (assuming full exercise, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform each Participation Rights Holder that purchases all the shares available to it it, after the expiration of such ten (each10) Business Day period, a “Fully-Exercising Holder”) the Corporation shall promptly notify DTV Holding of any other Participation Rights HolderCorporation stockholder’s failure to do likewiselikewise pursuant to the Stock Purchase Agreement dated as of July 15, 2015 by and among the Corporation and the purchasers a party thereto (the “2015 SPA”). During the ten (10) day period commencing after the receipt of such informationnotice given by the Corporation, each Fully-Exercising Holder shall be entitled DTV Holding may, by giving notice to obtain the Corporation, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders such Corporation stockholders were entitled to subscribe pursuant to the 2015 SPA, but which that were not subscribed for by such stockholders. The closing of any sale pursuant to this Section 4.1(b) shall occur on the Participation Rights Holders that date of the first closing of the sale of New Securities pursuant to Section 4.1(c) or, if no such sale under Section 4.1(c) shall occur, no later than the date which is equal to one hundred twenty (120) days of the proportion date that the number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by such Fully-Exercising Holder bears to the total number of shares of Common Stock issued and held, or issuable upon conversion of Preferred Stock then held, by all such Fully Exercising Investors who desire to purchase Shares for which Participation Rights Holders did not subscribeOffer Notice is given.
(c) The Company mayIf all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Corporation shall, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company Corporation does not enter into an agreement for the sale of the Shares New Securities referred to in the Offer Notice which are not elected to be purchased or acquired as provided in Section 4.1(b) within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares all of the New Securities referred to in the Offer Notice shall not be offered unless first reoffered to the Participation Rights Holders Investor Stockholders in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation; (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Exempted Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion shares of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate Common Stock issued in any other securities issuance”a Qualified IPO.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time the Company proposes , among (i) itself and (ii) its Affiliates; provided that each such Affiliate (x) is not a Competitor, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, and (y) agrees to enter into this Agreement and each of the Second Amended and Restated Voting Agreement and Second Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor shall not be entitled to any rights as a primary issuance (“Shares”)Major Investor under Subsections 3.1, the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:3.2 and 4.1 hereof.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen By notification to the Company within twenty (1520) calendar days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrantsPreferred Stock and any other Derivative Securities then outstanding). At the expiration of such twenty (20) day period, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of ninety (90) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five ninety (4590) day period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five thirty (4530) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Verve Therapeutics, Inc.)
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.3Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, (B) Cisco Systems so long as (i) Cisco continues Investor. A Major Investor shall be entitled to hold at least 180,729 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.3, Participation Rights Holder includes any Affiliated Persons of a Participation Rights Holder and a Participation Rights Holder who chooses to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Company proposes Exchange Act, of such Major Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner (x) is not a Competitor or FOIA Party, unless such party’s purchase of New Securities is otherwise consented to offer any additional shares of, or securities convertible into or exercisable for any shares of, any class of its capital stock for sale and issuance by the Company Board of Directors, (y) agrees to enter into this Agreement and each of the Voting Agreement and Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided that any Competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Subsections 3.1, 3.2 and 4.1 hereof), and (z) agrees to purchase at least such number of New Securities as are allocable hereunder to the Company shall first make an offering Major Investor holding the fewest number of such Shares to each Participation Rights Holder in accordance with the following provisions:Preferred Stock and any other Derivative Securities.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar days By notification to the Company within [***] after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Security then held by such Major Investor) bears to the total Common Stock of the Company then held by all the Major Investors (including all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock (assuming full exerciseand any other Derivative Securities then held by all the Major Investors). At the expiration of such [***] period, and conversion to Common Stock, of all outstanding warrants, options and other rights to acquire Preferred Stock) and full exercise of all outstanding warrants, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) day [***] period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of [***] of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the forty five (45) day [***] period following the expiration of the period periods provided in subsection 2.3(b) hereofSubsection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) days [***] of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Subsection 4.1.
(d) The right of first offer in this Section 2.3 Subsection 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding shares of Common Stock issued in the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Right of First Offer. Subject to the terms and conditions specified in of this Section 2.34.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company hereby grants the participation rights set forth in this Section 2.3 shall first offer such New Securities to (A) each Major Holder, Investor (B) Cisco Systems so long as (i) Cisco continues to hold at least 180,729 shares (as adjusted solely for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (ii) the Company has not delivered written notice to Cisco that the Board of Directors of the Company has made a Cisco Competitor Determination a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined), (C) each X. Xxxx Price Investor and Fidelity Investor, so long as the X. Xxxx Price Investors and Fidelity Investors, respectively, continue to hold in the aggregate at least 700,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (D) each Janus Capital Investor, so long as the Janus Capital Investors continue to hold in the aggregate at least 315,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities and (E) each Xxxxxxx Investor, so long as the Xxxxxxx Investors continue to hold in the aggregate at least 160,000 shares (as adjusted for stock splits, stock dividends, reclassification and the like) of Registrable Securities (each of the Investors described in (A), (B), (C), (D) or (E) above, a “Participation Rights Holder”). For purposes of this Section 2.34, Participation Rights Holder includes any Affiliated Persons of Auckland UniServices Limited shall be deemed a Participation Rights Holder and a Participation Rights Holder who chooses “Major Investor”). A Major Investor shall be entitled to exercise apportion the right of first offer may designate as purchasers under such right itself or its Affiliated Persons, hereby granted to it in such proportions as it deems appropriate. Each time , among itself or its Affiliates; provided that (i) such Affiliate is not a competitor of the Company proposes to offer any additional shares ofCompany, as reasonably determined by the Board, or securities convertible into or exercisable for any shares ofa FOIA Party, any class unless such party’s purchase of its capital stock for sale and issuance New Securities is otherwise consented to in writing by the Company Board, and (ii) such Affiliate agrees to enter into this Agreement and each of the Amended and Restated Voting Agreement and Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith among the Company, the Investors and the other parties named therein, as an “Investor” under each such agreement (provided, that any competitor or FOIA Party shall not be entitled to any rights as a primary issuance (“Shares”Major Investor under Sections 3.1, 3.2 and 4.1 hereof), the Company shall first make an offering of such Shares to each Participation Rights Holder in accordance with the following provisions:.
(a) The Company shall deliver a give notice by certified mail (the “Offer Notice”) to the Participation Rights Holders each Major Investor, stating (i) its bona fide intention to offer such SharesNew Securities, (ii) the number of such Shares New Securities to be offered, offered and (iii) the price and terms, if any, upon which it proposes to offer such SharesNew Securities.
(b) Within fifteen (15) calendar By notification to the Company within 20 days after delivery of the NoticeOffer Notice is given, each Participation Rights Holder Major Investor may elect to purchase or obtainotherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such Shares New Securities which equals the proportion that the number of shares of Common Stock issuable, directly or indirectly, upon conversion of all outstanding shares of Preferred Stock then held by such Participation Rights Holder bears to the aggregate number of Major Investor (including all shares of Common Stock then outstanding and all shares of Common Stock issuable, issuable (directly or indirectly, ) upon conversion and/or exercise, as applicable, of all outstanding shares of the Preferred Stock and any other Derivative Securities then held by such Major Investor) bears to the total Common Stock then outstanding (assuming full conversion and/or exercise, and conversion to Common Stockas applicable, of all outstanding warrants, options Preferred Stock and other rights to acquire Preferred Stock) and full exercise Derivative Securities then outstanding). At the expiration of all outstanding warrantssuch 20 day period, options and other rights to acquire Common Stock. Such purchases shall be completed at the same closing as that of any third party purchasers or at an additional closing thereunder. The Company shall promptly, in writing, inform promptly notify each Participation Rights Holder Major Investor that purchases elects to purchase or acquire all the shares available to it (each, a “Fully-Fully Exercising HolderInvestor”) of any other Participation Rights HolderMajor Investor’s failure to do likewise. During the ten (10) 10 day period commencing after receipt of the Company has given such informationnotice, each Fully-Fully Exercising Holder shall be entitled Investor may, by giving notice to obtain the Company, elect to purchase or acquire, in addition to the number of shares specified above, up to that portion of the Shares New Securities for which Participation Rights Holders Major Investors were entitled to subscribe but which that were not subscribed for by the Participation Rights Holders that Major Investors which is equal to the proportion that the number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of Preferred Stock and any other Derivative Securities then held, by such Fully-Fully Exercising Holder Investor bears to the total number of shares of Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of the Preferred Stock and any other Derivative Securities then held, by all such Fully Exercising Investors who desire wish to purchase Shares for which Participation Rights Holders did not subscribesuch unsubscribed shares. The closing of any sale pursuant to this Section 4.1(b) shall occur within the later of 90 days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Section 4.1(c).
(c) The If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Section 4.1(b), the Company may, during the forty five (45) 90 day period following the expiration of the period periods provided in subsection 2.3(b) hereofSection 4.1(b), offer and sell the remaining unsubscribed portion of the Shares such New Securities to any person Person or persons Persons at a price not less than, and upon terms no more favorable to the offeree than than, those specified in the Offer Notice. If the Company does not enter into an agreement for the sale of the Shares New Securities within such period, or if such agreement is not consummated within forty five (45) 30 days of the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares New Securities shall not be offered unless first reoffered to the Participation Rights Holders Major Investors in accordance herewithwith this Section 4.1.
(d) The right of first offer in this Section 2.3 4.1 shall not be applicable to (i) Exempted Securities (as defined in the issuance of securities excluded from the definition of “Additional Stock” under Article IV, Section (B)(4)(d)(i)(B)(1)-(8) of the Company’s Amended and Restated Certificate of Incorporation); or (ii) the assignment by the Company of a right of first refusal that the Company may have with respect to any proposed sale of shares of the Company’s capital stock; or (iii) the issuance of securities that Participation Rights Holders holding a majority of the Registrable Securities held by Participation Rights Holders agree in writing to exclude from the provisions of this Section 2.3; provided, however, notwithstanding any such waiver (or waiver of such provisions pursuant to Section 3.4), Common Stock issued in the event that a Participation Rights Holders actually purchases Shares in any transaction contemplated by this Section 2.3, then each other Participation Rights Holders shall be permitted to participate on a pro rata basis relative to the Participation Rights Holders purchasing the largest proportion of such Participation Rights Holder’s pro rata share. In addition to the foregoing, the right of first offer in this Section 2.3 shall not be applicable with respect to any Participation Rights Holder and any particular subsequent securities issuance, if (i) at the time of such subsequent securities issuance, the Participation Rights Holder is not an “accredited investor,” as that term is then defined in Rule 501(a) under the Securities Act, and (ii) such subsequent securities issuance is otherwise being offered only to accredited investors; provided, that notwithstanding the foregoing the exclusion of any Participation Rights Investor from any particular securities issuance shall not affect the right of such Participation Rights Investor to participate in any other securities issuance”IPO.
Appears in 1 contract
Samples: Investors’ Rights Agreement (Rain Therapeutics Inc.)
