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RESTATED INVESTORS' RIGHTS AGREEMENT
THIS RESTATED INVESTORS' RIGHTS AGREEMENT is made as of November 14,
1994 by and among BIOSTAR, INC., a Delaware corporation (the "Company"), and
the investors listed on Schedule A hereto. Each such investor is herein
referred to individually as an "Investor" and collectively as the "Investors."
RECITALS
WHEREAS, in connection with the sale and issuance of additional shares
of the Company's Series E Preferred Stock the Company and a new investor listed
on Schedule A hereto are parties to that certain Series E Preferred Stock
Purchase Agreement, dated June 27, 1994, as amended by Letter Agreement of even
date herewith (the "Series E Agreement");
WHEREAS, stock rights were previously granted pursuant to the Restated
Investors' Rights Agreement dated as of June 27, 1994 (the "Prior Rights
Agreement") to the BMPI Liquidating Trust (the "Trust"), Dominion Ventures,
Inc. ("DVI"), the investors who previously purchased Series D Preferred Stock,
and the investors who previously purchased Series E Preferred Stock (the "Prior
Investors");
WHEREAS, in order to induce the Company to enter into the Series E
Agreement and to induce certain of the investors listed on Schedule A hereto to
invest funds in the Company pursuant to the Series E Agreement, the investors
listed on Schedule A hereto and the Company hereby agree that this Agreement
shall govern the rights of the investors listed on Schedule A hereto to cause
the Company to register shares of Common Stock issuable to the investors listed
on Schedule A hereto and certain other matters as set forth herein; and
WHEREAS, it is anticipated that future sales of securities of a
similar nature may occur;
WHEREAS, the Company and the Investors desire to set forth in a single
agreement the rights to be granted to the investors who are parties to the
Series E Agreement.
NOW, THEREFORE,the parties hereby agree as follows:
1. REGISTRATION RIGHTS. The Company covenants and agrees as
follows:
1.1 DEFINITIONS. For purposes of this Agreement:
(a) The term "ACT" means the Securities Act of 1933, as
amended;
(b) The term "REGISTER," "REGISTERED," and
"REGISTRATION" refer to a registration effected by preparing and filing a
registration statement or similar document in compliance with the Act, and the
declaration or ordering of effectiveness of such registration statement or
document;
(c) The term "REGISTRABLE SECURITIES" means (1)the
Common Stock issuable or issued upon conversion of the Series A Preferred
Stock, (2) the Common Stock
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issuable upon conversion of the Series B Preferred Stock, (3) the Common Stock
issuable upon conversion of the Series B Preferred Stock issuable upon exercise
of a warrant potentially exercisable for a maximum of 60,750 shares of the
Company's Series B Preferred Stock (the "Series B Warrant") issued to DVI
pursuant to that certain Warrant to Purchase Shares of Series B Preferred
Stock, dated November 2, 1992, (4)the Common Stock issuable upon conversion of
the Series C Preferred Stock issuable upon conversion or exercise of a
convertible instrument potentially convertible into a maximum of 1,600,000
shares of the Company's Series C Preferred Stock (the "Convertible Instrument")
issued to the Trust pursuant to that certain Asset Purchase Agreement dated
June 17, 1992, by and between the Company and the Trust (the "Asset Purchase
Agreement"), (5) the Common Stock issuable upon conversion of the Series E
Preferred Stock issuable upon exercise of a warrant potentially exercisable for
a maximum of 53,357 shares of the Company's Series E Preferred Stock (the
"Series E Warrant") issued to DVI pursuant to that certain Warrant to Purchase
shares of Series E Preferred Stock, dated February 18, 1994, (6)the Common
Stock issuable upon conversion of the Series D Preferred Stock, (7)the Common
Stock issuable upon conversion of the Series E Preferred Stock, and (8) any
Common Stock of the Company issued (or issuable upon the conversion or exercise
of any warrant, right or other security which is issued as) a dividend or other
distribution with respect to, or in exchange for or in replacement of, such
Series A, Series B, Series C, Series D or Series E Preferred Stock or Common
Stock, excluding in all cases, however, any Registrable Securities sold by a
person in a transaction in which his rights under this Section 1 are not
assigned;
(d) The number of shares of "REGISTRABLE SECURITIES THEN
OUTSTANDING" shall be determined by the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable
pursuant to then exercisable or convertible securities which are, Registrable
Securities;
(e) The term "HOLDER" means any person owning or having
the right to acquire Registrable Securities or any assignee thereof in
accordance with Section 1.13 hereof; and
(f) The term "FORM S-3" means such form under the Act as
in effect on the date hereof or any registration form under the Act
subsequently adopted by the Securities and Exchange Commission ("SEC") which
permits inclusion or incorporation of substantial information by reference to
other documents filed by the Company with the SEC.
1.2 REQUEST FOR REGISTRATION.
(a) If the Company shall receive at any time after the
earlier of (i) June 27, 1997, or (ii) three (3) months after the effective date
of the first registration statement for a public offering of securities of the
Company (other than a registration statement relating either to the sale of
securities to employees of the Company pursuant to a stock option, stock
purchase or similar plan or a SEC Rule 145 transaction), a written request from
the Holders of at least a majority of the Registrable Securities then
outstanding that the Company file a registration statement under the Act
covering the registration of at least twenty percent (20%) of the Registrable
Securities then outstanding (or a lesser percent if the anticipated aggregate
offering price, net of underwriting discounts and commissions would exceed
$5,000,000), then the
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Company shall, within ten (10) days of the receipt thereof, give written notice
of such request to all Holders and shall, subject to the limitations of
subsection 1.2(b), effect as soon as practicable, and in any event shall use
its best efforts to effect within sixty (60) days of the receipt of such
request, the registration under the Act of all Registrable Securities which the
Holders request to be registered within twenty (20) days of the mailing of such
notice by the Company in accordance with paragraph 3.5.
(b) If the Holders initiating the registration request
hereunder ("Initiating Holders") intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so
advise the Company as a part of their request made pursuant to this Section 1.2
and the Company shall include such information in the written notice referred
to in subsection 1.2(a). The underwriter will be selected by the Company and
shall be reasonably acceptable to a majority in interest of the Initiating
Holders. In such event, the right of any Holder to include his Registrable
Securities in such registration shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting (unless otherwise mutually agreed by
a majority in interest of the Initiating Holders and such Holder) to the extent
provided herein. All Holders proposing to distribute their securities through
such underwriting shall (together with the Company as provided in subsection
1.4(e)) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting by a majority in
interest of the Initiating Holders. Notwithstanding any other provision of this
Section 1.2, if the underwriter advises the Initiating Holders in writing that
marketing factors require a limitation of the number of shares to be
underwritten, then the Initiating Holders shall so advise all Holders of
Registrable Securities which would otherwise be underwritten pursuant hereto,
and the number of shares of Registrable Securities that may be included in the
underwriting shall be allocated among all Holders thereof, including the
Initiating Holders, in proportion (as nearly as practicable) to the amount of
Registrable Securities of the Company owned by each Holder; provided, however,
that the number of shares of Registrable Securities to be included in such
underwriting shall not be reduced unless all other securities are first
entirely excluded from the underwriting.
(c) The Company is obligated to effect only two (2) such
registrations pursuant to this Section 1.2.
(d) Notwithstanding the foregoing, if the Company shall
furnish to Holders requesting a registration statement pursuant to this Section
1.2, a certificate signed by the President of the Company stating that in the
good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such registration
statement to be filed and it is therefore essential to defer the filing of such
registration statement, the Company shall have the right to defer taking action
with respect to such filing for a period of not more than 60 days after receipt
of the request of the Initiating Holders; provided, however, that the Company
may not utilize this right more than once in any twelve-month period.
1.3 COMPANY REGISTRATION. If (but without any obligation to
do so) the Company proposes to register (including for this purpose a
registration effected by the Company for shareholders other than the Holders)
any of its stock or other securities under the Act in connection with the
public offering of such securities solely for cash (other than a registration
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relating solely to the sale of securities to participants in a Company stock
plan, or a registration on any form which does not include substantially the
same information as would be required to be included in a registration
statement covering the sale of the Registrable Securities), the Company shall,
at such time, promptly give each Holder written notice of such registration.
Upon the written request of each Holder given within twenty (20) days
after mailing of such notice by the Company in accordance with Section 3.5, the
Company shall, subject to the provisions of Section 1.8, cause to be registered
under the Act all of the Registrable Securities that each such Holder has
requested to be registered.
1.4 OBLIGATIONS OF THE COMPANY. Whenever required under
this Section 1 to effect the registration of any Registrable Securities, the
Company shall, as expeditiously as reasonably possible:
(a) Prepare and file with the SEC a registration
statement with respect to such Registrable Securities and use its best efforts
to cause such registration statement to become effective, and, upon the request
of the Holders of a majority of the Registrable Securities registered
thereunder, keep such registration statement effective for up to one hundred
twenty (120) days.
(b) Prepare and file with the SEC such amendments and
supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply with
the provisions of the Act with respect to the disposition of all securities
covered by such registration statement.
(c) Furnish to the Holders such numbers of copies of a
prospectus, including a preliminary prospectus, in conformity with the
requirements of the Act, and such other documents as they may reasonably
request in order to facilitate the disposition of Registrable Securities owned
by them.
(d) Use its best efforts to register and qualify the
securities covered by such registration statement under such other securities
or Blue Sky laws of such jurisdiction as shall be reasonably requested by the
Holders, provided that the Company shall not be required in connection
therewith or as a condition thereto to qualify to do business or to file a
general consent to service of process in any such states or jurisdictions.
(e) In the event of any underwritten public offering,
enter into and perform its obligations under an underwriting agreement, in
usual and customary form, with the managing underwriter of such offering. Each
Holder participating in such underwriting shall also enter into and perform its
obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered
by such registration statement at any time when a prospectus relating thereto
is required to be delivered under the Act of the happening of any event as a
result of which the prospectus included in such registration statement, as then
in effect, includes an untrue statement of a material fact or omits to state a
material fact required to be stated therein or necessary to make the statements
therein not misleading in the light of the circumstances then existing.
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(g) Use its best efforts to furnish, at the request of
any Holder requesting registration of Registrable Securities pursuant to this
Section 1, on the date that such Registrable Securities are delivered to the
underwriters for sale in connection with a registration pursuant to this
Section 1, if such securities are being sold through underwriters, or, if such
securities are not being sold through underwriters, on the date that the
registration statement with respect to such securities becomes effective, (i)an
opinion, dated such date, of the counsel representing the Company for the
purposes of such registration, in form and substance as is customarily given to
underwriters in an underwritten public offering, addressed to the underwriters,
if any, and to the Holders requesting registration of Registrable Securities
and (ii) a letter dated such date, from the independent certified public
accountants of the Company, in form and substance as is customarily given by
independent certified public accountants to underwriters in an underwritten
public offering, addressed to the underwriters, if any, and to the Holders
requesting registration of Registrable Securities.
1.5 FURNISH INFORMATION.
(a) It shall be a condition precedent to the obligations
of the Company to take any action pursuant to this Section 1 with respect to
the Registrable Securities of any selling Holder that such Holder shall furnish
to the Company such information regarding itself, the Registrable Securities
held by it, and the intended method of disposition of such securities as shall
be required to effect the registration of such Holder's Registrable Securities.
(b) The Company shall have no obligation with respect to
any registration requested pursuant to Section 1.2 or Section 1.12 if, due to
the operation of subsection 1.5(a), the number of shares or the anticipated
aggregate offering price of the Registrable Securities to be included in the
registration does not equal or exceed the number of shares or the anticipated
aggregate offering price required to originally trigger the Company's
obligation to initiate such registration as specified in subsection 1.2(a) or
subsection 1.12(b)(2), whichever is applicable.
1.6 EXPENSES OF DEMAND REGISTRATION. All expenses other than
underwriting discounts and commissions incurred in connection with
registrations, filings or qualifications pursuant to Section 1.2 including
(without limitation) all registration, filing and qualification fees, printers'
and accounting fees, fees and disbursements of counsel or the Company, and the
reasonable fees and disbursements of one counsel for the selling Holders shall
be borne by the Company; provided, however, that the Company shall not be
required to pay for any expenses of any registration proceeding begun pursuant
to Section 1.2 if the registration request is subsequently withdrawn at the
request of the Holders of a majority of the Registrable Securities to be
registered (in which case all Participating Holders shall bear such expenses),
unless the Holders of a majority of the Registrable Securities agree to forfeit
their right to one demand registration pursuant to Section 1.2; provided
further, however, that if at the time of such withdrawal, the Holders have
learned of a material adverse change in the condition, business, or prospects
of the Company from that known to the Holders at the time of their request and
have withdrawn the request with reasonable promptness following disclosure by
the Company of such material adverse change, then the Holders shall not be
required to pay any of such expenses and shall retain their rights pursuant to
Section 1.2.
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1.7 EXPENSES OF COMPANY REGISTRATION. The Company shall bear
and pay all expenses incurred in connection with any registration, filing or
qualification of Registrable Securities with respect to the registrations
pursuant to Section 1.3 for each Holder (which right may be assigned as
provided in Section 1.13), including (without limitation) all registration,
filing, and qualification fees, printers and accounting fees relating or
apportionable thereto and the fees and disbursements of one counsel for the
selling Holders selected by them, but excluding underwriting discounts and
Commissions relating to Registrable Securities.
1.8 UNDERWRITING REQUIREMENTS. In connection with any offering
involving an underwriting of shares of the Company's capital stock, the Company
shall not be required under Section 1.3 to include any of the Holders'
securities in such underwriting unless they accept the terms of the
underwriting as agreed upon between the Company and the underwriters selected
by it (or by other persons entitled to select the underwriters), and then only
in such quantity as the underwriters determine in their sole discretion will
not, jeopardize the success of the offering by the Company. If the total amount
of securities, including Registrable Securities, requested by stockholders to
be included in such offering exceeds the amount of securities sold other than
by the Company that the underwriters determine in their sole discretion is
compatible with the success of the offering, then the Company shall be required
to include in the offering only that number of such securities, including
Registrable Securities, which the underwriters determine in their sole
discretion will not jeopardize the success of the offering (the securities so
included to be apportioned pro rata among the selling stockholders according to
the total amount of securities entitled to be included therein owned by each
selling stockholder or in such other proportions as shall mutually be agreed to
by such selling stockholders) but in no event shall (i) the amount of
securities of the selling Holders included in the offering be reduced below
thirty percent (30%) of the total amount of securities included in such
offering, unless such offering is the initial public offering of the Company's
securities in which case the selling stockholders may be excluded if the
underwriters make the determination described above and no other stockholder's
securities are included or (ii) notwithstanding (i) above, any shares being
sold by a stockholder exercising a demand registration right similar to that
granted in Section 1.2 be excluded from such offering. For purposes of the
preceding parenthetical concerning apportionment, for any selling stockholder
which is a holder of Registrable Securities and which is a partnership or
corporation, the partners, retired partners and stockholders of such holder, or
the estates and family members of any such partners and retired partners and
any trusts for the benefit of any of the foregoing persons shall be deemed to
be a single "selling stockholder," and any pro-rata reduction with respect to
such "selling stockholder" shall be based upon the aggregate amount of shares
carrying registration rights owned by all entities and individuals included in
such "selling stockholder," as defined in this sentence.
1.9 DELAY OF REGISTRATION. No Holder shall have any right
to obtain or seek an injunction restraining or otherwise delaying any such
registration as the result of any controversy that might arise with respect to
the interpretation or implementation of this Section 1.
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1.10 INDEMNIFICATION. In the event any Registrable
Securities are included in a registration statement under this Section 1:
(a) To the extent permitted by law, the Company will
indemnify and hold harmless each Holder, any underwriter (as defined in the
Act) for such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Act or the Securities Exchange Act of
1934, as amended (the "1934 Act"), against any losses, claims, damages, or
liabilities (joint or several) to which they may become subject under the Act,
the 1934 Act or other federal or state law, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon any of the following statements, omissions or violations
(collectively a "Violation"): (i) any untrue statement or alleged untrue
statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto, (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading, or (iii)any violation or alleged
violation by the Company of the Act, the 1934 Act, any state securities law or
any rule or regulation promulgated under the Act, the 1934 Act or any state
securities law; and the Company will pay to each such Holder, underwriter or
controlling person, as incurred, any legal or other expenses reasonably
incurred by them in connection with investigating or defending any such loss,
claim, damage, liability or action; provided, however, that the indemnity
agreement contained in this subsection 1.10(a) shall not apply to amounts paid
in settlement of any such loss claim, damage, liability, or action if such
settlement is effected without the consent of the Company (which consent shall
not be unreasonably withheld), nor shall the Company be liable in any such case
for any such loss, claim, damage, liability, or action to the extent that it
arises out of or is based upon a Violation which occurs in reliance upon and in
conformity with written information furnished expressly for use in connection
with such registration by any such Holder, underwriter or controlling person.
(b) To the extent permitted by law, each selling Holder
will indemnify and hold harmless the Company, each of its directors, each of
its officers who has signed the registration statement, each person, if any,
who controls the Company within the meaning of the Act, any underwriter, any
other Holder selling securities in such registration statement and any
controlling person of any such underwriter or other Holder, against any losses,
claims, damages, or liabilities (joint or several) to which any of the
foregoing persons may become subject, under the Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages, or liabilities
(or actions in respect thereto) arise out of or are based upon any Violation,
in each case to the extent (and only to the extent) that such Violation occurs
in reliance upon and in conformity with written information furnished by such
Holder expressly for use in connection with such registration; and each such
Holder will pay, as incurred, any legal or other expenses reasonably incurred
by any person intended to be indemnified pursuant to this subsection 1.10(b),
in connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained
in this subsection 1.10(b) shall not apply to amounts paid in settlement of any
such loss, claim, damage, liability or action if such settlement is effected
without the consent of the Holder, which consent shall not be unreasonably
withheld; provided, that, in no event shall any indemnity under this subsection
1.10(b) exceed the gross proceeds from the offering received by such Holder.
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(c) Promptly after receipt by an indemnified party under
this Section 1.10 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 1.10,
deliver to the indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
(together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel,
with the fees and expenses to be paid by the indemnifying party, if
representation of such indemnified party by the counsel retained by the
indemnifying party would be inappropriate due to actual or potential differing
interests between such indemnified party and any other party represented by
such counsel in such proceeding. The failure to deliver written notice to the
indemnifying party within a reasonable time of the commencement of any such
action, if prejudicial to its ability to defend such action, shall relieve such
indemnifying party of any liability to the indemnified party under this Section
1.10, but the omission so to deliver written notice to the indemnifying party
will not relieve it of any liability that it may have to any indemnified party
otherwise than under this Section 1.10.
(d) If the indemnification provided for in this Section
1.10 is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, liability, claim, damage, or
expense referred to therein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amount
paid or payable by such indemnified party as a result of such loss, liability,
claim, damage, or expense in such proportion as is appropriate to reflect the
relative fault of the indemnifying party on the one hand and of the indemnified
party on the other in connection with the statements or omissions that resulted
in such loss, liability, claim, damage, or expense as well as any other
relevant equitable considerations. The relative fault of the indemnifying party
and of the indemnified party shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or
the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties' relative
intent, knowledge, access to information, and opportunity to correct or prevent
such statement or omission.
(e) Notwithstanding the foregoing, to the extent that
the provisions on indemnification and contribution contained in the
underwriting agreement entered into in connection with the underwritten public
offering are in conflict with the foregoing provisions, the provisions in the
underwriting agreement shall control.
(f) The obligations of the Company and Holders under
this Section 1.10 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
1.11 REPORTS UNDER SECURITIES EXCHANGE ACT OF 1934. With a
view to making available to the Holders the benefits of Rule 144 promulgated
under the Act and any other rule or regulation of the SEC that may at any time
permit a Holder to sell securities of the Company to the public without
registration or pursuant to a registration on Form S-3, the Company agrees to:
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(a) make and keep public information available, as those
terms are understood and defined in SEC Rule 144, at all times after ninety
(90) days after the effective date of the first registration statement filed by
the Company for the offering of its securities to the general public;
(b) take such action, including the voluntary
registration of its Common Stock under Section 12 of the 1934 Act, as is
necessary to enable the Holders to utilize Form S-3 for the sale of their
Registrable Securities, such action to be taken as soon as practicable after
the end of the fiscal year in which the first registration statement filed by
the Company for the offering of its securities to the general public is
declared effective;
(c) file with the SEC in a timely manner all reports and
other documents required of the Company under the Act and the 1934 Act; and
(d) furnish to any Holder, so long as the Holder owns
any Registrable Securities, forthwith upon request (i) a written statement by
the Company that it has complied with the reporting requirements of SEC Rule
144 (at any time after ninety (90) days after the effective date of the first
registration statement filed by the Company), the Act and the 1934 Act (at any
time after it has become subject to such reporting requirements), or that it
qualifies as a registrant whose securities may be resold pursuant to form S-3
(at any time after it so qualifies), (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents so filed
by the Company, and (iii) such other information as may be reasonably requested
in availing any Holder of any rule or regulation of the SEC which permits the
selling of any such securities without registration or pursuant to such form.
1.12 FORM S-3 REGISTRATION. In case the Company shall
receive from any Holder or Holders of twenty percent (20%) or more of the
Registrable Securities then outstanding a written request or requests that the
Company effect a registration on Form S-3 and any related qualification or
compliance with respect to all or a part of the Registrable Securities owned by
such Holder or Holders, the Company will:
(a) promptly give written notice of the proposed
registration, and any related qualification or compliance, to all other
Holders; and
(b) as soon as practicable, effect such registration and
all such qualifications and compliances as may be so requested and as would
permit or facilitate the sale and distribution of all or such portion of such
Holder's or Holders' Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any other
Holder or Holders joining in such request as are specified in a written request
given within fifteen (15) days after receipt of such written notice from the
Company; provided, however, that the Company shall not be obligated to effect
any such registration, qualification or compliance, pursuant to this Section
1.12: (1) if Form S-3 is not available for such offering by the Holders; (2) if
the Holders, together with the holders of any other securities of the Company
entitled to inclusion in such registration, propose to sell Registrable
Securities and such other securities (if any) at an aggregate price to the
public (net of any underwriters' discounts or commissions) of less than
$250,000; (3) if the Company shall furnish to the Holders a certificate signed
by the president of the Company stating that in the good faith judgment of the
Board of Directors of the
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Company, it would be seriously detrimental to the Company and its shareholders
for such Form S-3 Registration to be effected at such time, in which event the
Company shall have the right to defer the filing of the Form S-3 registration
statement for a period of not more than sixty (60) days after receipt of the
request of the Holder or Holders under this Section 1.12; provided, however,
that the Company shall not utilize this right more than once in any twelve-
month period; (4) if the Company has, within the twelve (12) month period
preceding the date of such request, already effected two registrations on Form
S-3 for the Holders pursuant to this Section 1.12; or (5) in any particular
jurisdiction in which the Company would be required to qualify to do business
or to execute a general consent to service of process in effecting such
registration, qualification or compliance.
(c) Subject to the foregoing, the Company shall file a
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders. All expenses incurred in connection with a
registration requested pursuant to Section 1.12, including (without limitation)
all registration, filing, qualification, printer's and accounting fees and the
reasonable fees and disbursements of counsel for the selling Holder or Holders
and counsel for the Company, but excluding any underwriters' discounts or
commissions associated with Registrable Securities, shall be borne pro rata by
the Holder or Holders participating in the Form S-3 Registration. Registrations
effected pursuant to this Section 1.12 shall not be counted as demands for
registration or registrations effected pursuant to Sections 1.2 or 1.3,
respectively.
1.13 ASSIGNMENT OF REGISTRATION RIGHTS. The rights to cause the
Company to register Registrable Securities pursuant to this Section 1 may be
assigned (but only with all related obligations) by a Holder to a transferee or
assignee of such securities who, after such assignment or transfer, holds at
least 500,000 shares of Registrable Securities (subject to appropriate
adjustment for stock splits, stock dividends, combinations and other
recapitalization), or if less, the entire amount of Registrable Securities held
by such Holder is transferred, provided the Company is, within a reasonable
time after such transfer, furnished with written notice of the name and address
of such transferee or assignee and the securities with respect to which such
registration rights are being assigned; and provided, further, that such
assignment shall be effective only if immediately following such transfer the
further disposition of such securities by the transferee or assignee is
restricted under the Act. For the purposes of determining the number of shares
of Registrable Securities held by a transferee or assignee, the holdings of
transferees and assignees of a partnership who are partners or retired partners
of such partnership (including spouses and ancestors, lineal descendants and
siblings of such partners or spouses who acquire Registrable Securities by
gift, will or intestate succession) shall be aggregated together and with the
partnership; provided that all assignees and transferees who would not qualify
individually for assignment of registration rights shall have a single
attorney-in-fact for the purpose of exercising any rights receiving notices or
taking any action under this Section 1. For the purposes of determining the
number of shares of Registrable Securities held by a transferee or assignee the
holdings of transferees and assignees of a trust who are beneficiaries of such
trust (including spouses and ancestors, lineal descendants and siblings of such
beneficiaries or spouses who acquire Registrable Securities by gift, will or
intestate succession) shall be aggregated together and with the trust; provided
that all assignees and transferees who would not qualify individually for
assignment of registration rights shall have a single attorney-in-fact for the
purpose of exercising any rights, receiving notices or taking any action under
this Section 1.
10.
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The registration rights of the Holders under this Agreement may be transferred
to any transferee which is an affiliated Limited Partnership (as defined in the
Series B Warrant) or fund of such Holder ("Affiliated Fund") without the prior
written consent of the Company and without regard to the number of shares of
Registrable Securities held by such transferee.
1.14 LIMITATIONS ON SUBSEQUENT REGISTRATION RIGHTS. From and
after the date of this Agreement, the Company shall not, without the prior
written consent of the Holders of a majority of the outstanding Registrable
Securities, enter into any agreement with any holder or prospective holder of
any securities of the Company which would allow such holder or prospective
holder (a) to include such securities in any registration filed under Section
1.2 hereof, unless under the terms of such agreement, such holder or
prospective holder may include such securities in any such registration only to
the extent that the inclusion of his securities will not reduce the amount of
the Registrable Securities of the Holders which is included or (b) to make a
demand registration which could result in such registration statement being
declared effective prior to the earlier of either of the dates set forth in
subsection 1.2(a) or within one hundred twenty (120) days of the effective date
of any registration effected pursuant to Section 1.2.
1.15 "MARKET STAND-OFF" AGREEMENT. Each Investor hereby
agrees that, during the period of duration specified by the Company and an
underwriter of Common Stock or other securities of the Company, following the
effective date of a registration statement of the Company filed under the Act,
shall not, to the extent requested by the Company and such underwriter,
directly or indirectly sell, offer to sell, contract to sell (including,
without limitation, any short sale), grant any option to purchase or otherwise
transfer or dispose of (other than to donees who agree to be similarly bound)
any securities of the Company held by it at any time during such period except
Common Stock included in such registration; provided, however, that (i) all
officers and directors of the Company and all other persons with registration
rights (whether or not pursuant to this Agreement) enter into similar
agreements, (ii) the provisions of this Section 1.15 shall terminate and be of
no further force or effect three (3) years after the consummation of the
initial public offering of securities of the Company (other than a registration
statement relating either to the sale of securities to employees of the Company
pursuant to a stock option, stock purchase or similar plan or a SEC Rule 145
transaction) and (iii) such period of duration shall not exceed one hundred
eighty (180) days; provided that the parties hereto expressly agree to and
understand that such 180-day period may be shortened or lengthened by a writing
signed by the holders of a majority of the Registrable Securities.
In order to enforce the foregoing covenant, the Company may impose
stop-transfer instructions with respect to the Registrable Securities of each
Investor (and the shares or securities of every other person subject to the
foregoing restriction) until the end of such period.
1.16 AMENDMENT AND WAIVER OF REGISTRATION RIGHTS. Any provision
of this Section 1 may be amended and the observance thereof may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the Company and the holders of
at least fifty percent (50%) of the Registrable Securities then outstanding.
Any amendment or waiver effected in accordance with this paragraph shall be
binding upon each holder of any Registrable Securities then outstanding, each
future holder of all such Registrable Securities, and the Company.
11.
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1.17 TERMINATION OF REGISTRATION RIGHTS. No Holder shall
be entitled to exercise any right provided for in this Section ! after five (5)
years following the consummation of the sale of securities pursuant to a
registration statement filed by the Company under the Act in connection with
the initial firm commitment underwritten offering of its securities to the
general public.
2. COVENANTS OF THE COMPANY.
2.1 DELIVERY OF FINANCIAL STATEMENT. The Company shall
deliver to each Major Investor who holds at least an aggregate of 400,000 shams
of the Series A, Series B, Series C, Series D or Series E Preferred Stock of
the Company (or the common stock issued upon conversion thereof) ("Major
Investor"):
(a) as soon as practicable, but in any event within
ninety (90) days after the end of each fiscal year of the Company, an income
statement for such fiscal year, a balance sheet of the Company and statement of
shareholder's equity as of the end of such year, and a schedule as to the
sources and applications of funds for such year, such year-end financial
reports to be in reasonable detail, prepared in accordance with generally
accepted accounting principles ("GAAP"), and audited and certified by
independent public accountants of nationally recognized standing selected by
the Company;
(b) as soon as practicable, but in any event within
forty- five (45) days after the end of each of the first three (3) quarters of
each fiscal year of the Company, an unaudited profit or loss statement,
schedule as to the sources and application of funds for such fiscal quarter, an
unaudited balance sheet and a statement of shareholder's equity as of the end
of such fiscal quarter and a statement showing the number of shares of each
class and Series of capital stock and securities convertible into or
exercisable for shares of capital stock outstanding at the end of the period,
the number of common shares issuable upon conversion or exercise of any
outstanding securities convertible or exercisable for common shares and the
exchange ratio or exercise price applicable thereto, all in sufficient detail
as to permit the Major Investor to calculate its percentage equity ownership in
the Company;
(c) within thirty (30) days of the end of each month, an
unaudited income statement and schedule as to the sources and application of
funds and balance sheet for and as of the end of such month, in reasonable
detail;
(d) as soon as practicable, but in any event thirty (30)
days prior to the end of each fiscal year, a budget and business plan for the
next fiscal year, prepared on a monthly basis, including balance sheets and
sources and applications of funds statements for such months and, as soon as
prepared, any other budgets or revised budgets prepared by the Company;
(e) with respect to the financial statements called for
in subsections (b) and (c) of this Section 2.1, an instrument executed by the
Chief Financial Officer or President of the Company and certifying that such
financials were prepared in accordance with GAAP consistently applied with
prior practice for earlier periods (with the exception of footnotes that may be
required by GAAP) and fairly present the financial condition of the Company and
its results of operation for the period specified, subject to year-end audit
adjustment;
12.
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(f) such other information relating to the financial
condition, business, prospects or corporate affairs of the Company as the
Investor or any assignee of the Investor may from time to time request,
provided, however, that the Company shall not be obligated under this
subsection (f) or any other subsection of Section 2.1 to provide information
which it deems in good faith to be a trade secret or similar confidential
information.
2.2 INSPECTION. The Company shall permit each Major Investor,
at such Major Investor's expense, to visit and inspect the Company's
properties, to examine its books of account and records and to discuss the
Company's affairs, finances and accounts with its officers, all at such
reasonable times as may be requested by the Major Investor; provided, however,
that the Company shall not be obligated pursuant to this Section 2.2 to provide
access to any information which it reasonably considers to be a trade secret or
similar confidential information.
2.3 TERMINATION OF INFORMATION AND INSPECTION COVENANTS.
The covenants set forth in subsections 2.1(c), (d) and (f) and Section 2.2
shall terminate as to Investors and be of no further force or effect when the
sale of securities pursuant to a registration statement filed by the Company
under the Act in connection with the firm commitment underwritten offering of
its securities to the general public is consummated or when the Company first
becomes subject to the periodic reporting requirements of Sections 12(g) or
15(d) of the 1934 Act, whichever event shall first occur.
3. RIGHT OF FIRST REFUSAL.
3.1 GENERAL. No party to this Agreement other than the
Company shall sell, assign, transfer, or in any other manner dispose of or
alienate, or transfer or assign any interest in, any or all of the Shares (as
such term is defined below) which now or hereafter may be held or owned by them
to any person or entity unless such party (for purposes of this Section 3 only
referred to as "Offeror") shall have first made the written offer to sell as
hereinafter described, and the offered Shares shall not have been purchased,
within the time hereinafter provided.
For purposes of this Section 3, "Shares" shall include and be deemed
to mean: (i) Series A Preferred Stock, (ii) Series B Preferred Stock, (iii)
Series C Preferred Stock, (iv) Series D Preferred Stock, (v)Series E Preferred
Stock, (vi) the Common Stock issued or issuable upon conversion of the Series
A, Series B, Series C, Series D or Series E Preferred Stock, and (vii) any
Common Stock of the Company issued as (or issuable upon the conversion or
exercise of any warrant, right or other security which is issued as) a dividend
or other distribution with respect to, or in exchange for or in replacement of,
such Series A, Series B, Series C, Series D, or Series E Preferred Stock or
Common Stock.
3.2 OFFER BY STOCKHOLDER. The Shares which the Offeror desires
to sell, assign, or transfer (the "Offered Shares") shall first be offered to
the Company by a written offer (the "Offer") to sell at the price, and on the
terms, set forth in subsection 3.4 below) to which shall be attached a
statement of intention to sell, assign, transfer, or otherwise dispose of the
Shares being offered, as the case may be, the name and address of each
prospective purchaser or assignee, if any, the number of Shares involved in the
proposed sale, assignment, or transfer, and
13.
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the price and terms of any such bona fide offer. The Offer shall be signed by
the Offeror and shall be delivered pursuant to the notice provisions of Section
5.5.
3.3 OPTION OF COMPANY TO PURCHASE. For thirty (30) days after
the receipt of the Offer (the "Offer Period"), the Company shall have the
right, but not the obligation to purchase all or some of the Offered Shares. If
the Company elects to purchase any of the Offered Shares, it shall so notify
the Offeror prior to the end of the Offer Period. The notice shall specify a
date for the closing of the purchase which shall not be more than thirty (30)
days after the date of the giving of such notice.
3.4 PURCHASE PRICE AND TERMS. The purchase price of the Shares
offered by the Offeror pursuant to this Section 3 to the Company shall be equal
to the price offered for the Shares by a prospective purchaser pursuant to a
bona fide offer of purchase (if received), as set forth in the Offer. The
Company shall purchase the Shares, on terms and conditions no less favorable to
the Company than those received by the Offeror in a bona fide offer of purchase
by a third party. In the event the purchase price specified in the Offer is
payable in property other than cash, the Company shall have the right to pay
the purchase price in the form of cash equal in amount to the fair market value
of such property as determined in good faith by the parties. If the Offeror and
the Company cannot agree on such cash value within ten (10) days after the
Company's receipt of the notice by the Offeror pursuant to this Section 3, the
valuation shall be made by an appraiser of recognized standing selected by the
Offeror and the Company or, if they cannot agree on an appraiser within twenty
(20) days after receipt of such notice, each shall select an appraiser of
recognized standing and the two appraisers shall designate a third appraiser of
recognized standing, whose appraisal shall be determinative of such value, and
which appraisal shall be completed within forty-five (45) days after receipt of
such notice. The closing for such purchase shall then be held on the later of
(i) the 15th business day following the exercise of the rights hereunder or
(ii) the 15th day after such cash valuation shall have been made.
3.5 RELEASE FROM RESTRICTION. If all of the Offered Shares are
not purchased by the Company in accordance with the terms of this Section 3,
the Offeror's offer shall be deemed rejected with respect to the remaining
Offered Shares, and, subject to the provisions of this Section 3 below, the
Offeror may make a bona fide sale, assignment, transfer, or other disposition
of all, but not less than all, of the remaining Offered Shares to the
prospective purchaser named in the statement attached to the offer at a price
not less than, and upon terms not more favorable than, the bona fide offer, if
any, described in the Offer.
If the Offeror shall fail to make such sale, assignment, transfer, or
other disposition within one hundred twenty (120) days following the expiration
of all periods of time hereinabove provided for purchase by the Company, the
remaining Offered Shares shall again become subject to all of the restrictions
of this Agreement and except as otherwise provided in this Agreement, the
Offeror shall not sell, assign, transfer or otherwise dispose of or alienate
the Shares without again offering said Shares to the Company as hereinabove
provided.
3.6 ASSIGNMENT. The Company may assign its right of first
refusal under this Section 3 to any party or parties.
14.
15
3.7 LAPSE. The right of first refusal under this Section 3
shall not be applicable to any sale of Shares pursuant to Section 1 of this
Agreement. In addition, the right of first refusal shall not apply to the
distribution of any Shares (i)held by the Trust to its beneficiaries; provided,
that the Trust obtains the prior written consent of the Company to such
distribution, and (ii) by a party to an Affiliated Fund. The right of first
refusal shall lapse upon the consummation of the Company's sale of its Common
Stock in a bona fide, firm commitment underwriting pursuant to a registration
statement on Form S-1 under the Act, the public offering price of which was not
less than $5.00 per share (adjusted to reflect subsequent stock dividends,
stock splits or recapitalization) and $10,000,000 in the aggregate.
4. RIGHT OF FIRST OFFER. Subject to the terms and conditions
specified in this Section 4, the Company hereby grants to each Major Investor a
right of first offer with respect to future sales by the Company of its Company
Shares (as hereinafter defined). A Major Investor shall be entitled to
apportion the right of first offer hereby granted it among itself and its
partners and affiliates in such proportions as it deems appropriate.
Each time the Company proposes to offer any shares of, or securities
convertible into or exercisable for any shares of, any class of its capital
stock ("Company Shares"), the Company shall first make an offering of such
Company Shares to each Major Investor in accordance with the following
provisions:
4.1 NOTICE. The Company shall deliver a notice by
certified mail ("Notice") to the Major Investors stating (i)its bona fide
intention to offer such Company Shares, (ii)the number of such Company Shares
to be offered, and (iii) the price and terms, if any, upon which it proposes to
offer such Company Shares.
4.2 ELECTION TO EXERCISE. Within ten (10) days after
receipt of the Notice, the Major Investor may elect to purchase or obtain, at
the price and on the terms specified in the Notice, up to that portion of such
Company Shares which equals the proportion that the number of shares of Common
Stock issued and held, or issuable upon conversion of the Series A, Series B,
Series C, Series D and Series E Preferred Stock then held, by such Major
Investor bears to the total number of shares of Common Stock (assuming
conversion of the Series A, Series B, Series C, Series D and Series E Preferred
Stock and the exercise or conversion of all outstanding options, warrants and
other instruments convertible into or exercisable for either Common Stock or
securities convertible into or exercisable for Common Stock) of the Company
then outstanding.
4.3 UNSUBSCRIBED PORTIONS. If all Company Shares referred
to in the Notice are not elected to be obtained as provided in subsection 4.2
hereof, the Company may, during the 30-day period following the expiration of
the period provided in subsection 4.2 hereof, offer the remaining unsubscribed
portion of such Company 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
Company Shares within such period, or if such agreement is not consummated
within thirty (30) days of the execution thereof, the right provided hereunder
shall be deemed to be revived and such Company Shares shall not be offered
unless first reoffered to the Major Investors in accordance herewith.
15.
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4.4 APPLICABILITY. The right of first offer in this Section 4
shall not be applicable (i)to the issuance or sale of shares of Common Stock
(or options therefor) to employees, directors or consultants of the Company,
(ii) the issuance of securities pursuant to the conversion or exercise of
convertible or exercisable securities, (iii) the issuance of securities in
connection with a bona fide business acquisition of or by the Company, whether
by merger, consolidation, sale of assets, sale or exchange of stock or
otherwise, (iv)the issuance of securities pursuant to a corporate partnership
(as determined by the Board of Directors), (v) the issuance of stock, warrants
or other securities or rights to persons or entities with which the Company has
business relationships, provided such issuances are for other than primarily
equity financing purposes, (vi)the issuance of securities pursuant to an
underwritten offering of the Company's securities, whether in a public offering
or in a private placement, or (vii)after consummation of the Company's sale of
its Common Stock in a bona fide, firm commitment underwriting pursuant to a
registration statement on Form S-1 under the Act, the public offering price of
which was not less than $5.00 per share (adjusted to reflect subsequent stock
dividends, stock splits or recapitalization) and $10,000,000 in the AGGREGATE.
4.5 WAIVER OF RIGHT OF FIRST OFFER. Those undersigned Investors
who are parties to the Prior Rights Agreement hereby agree that the issuance of
shares of Series E Preferred Stock to the Investors listed in Schedule A hereto
shall not be subject to the right of first offer held by the Prior Investors
pursuant to Section 4 of the Prior Rights Agreement. In addition, the Prior
Investors hereby waive the notice provisions contained in Section 4.1 of the
Prior Rights Agreement. The Prior Investors represent at least a majority of
the shares held by the "Major Investors" (as defined in the Prior Rights
Agreement).
Each of the parties to this Agreement expressly agrees and
acknowledges that any rights specified in this Section 4 may be waived for any
reason by a writing signed by Major Investors holding a majority of the shares
held by all Major Investors. The Major Investors acknowledge and agree that
they owe no duty by reason of this Agreement to each other or among themselves
to provide any opportunity to exercise the right of first offer set forth in
this Section 4, and that any waiver in accordance with this provision shall be
binding on all of them.
5. MISCELLANEOUS.
5.1 SUCCESSORS AND ASSIGNS. Except as otherwise provided herein,
the terms and conditions of this Agreement shall inure to the benefit of and be
binding upon the respective successors and assigns of the parties (including
transferees of any shares of Registrable Securities). Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations, or liabilities under or by reason of this Agreement,
except as expressly provided in this Agreement.
5.2 GOVERNING LAW. This Agreement shall be governed by and
construed under the laws of the State of Delaware as applied to agreements
among Delaware residents entered into and to be performed entirely within
Delaware.
16.
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5.3 COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
5.4 TITLES AND SUBTITLES. The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
5.5 NOTICES. Unless otherwise provided, any notice required or
permitted under this Agreement shall be given in writing and shall be deemed
effectively given upon personal delivery to the party to be notified or upon
deposit with the United States Post Office, by registered or certified mail,
postage prepaid and addressed to the party to be notified at the address
indicated for such party on the signature page hereof, or at such other address
as such party may designate by ten (10) days' advance written notice to the
other parties.
5.6 EXPENSES. If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be
entitled to reasonable attorneys' fees, costs and necessary disbursements in
addition to any other relief to which such party may be entitled.
5.7 AMENDMENTS AND WAIVERS. Except with respect to Sections 1
and 4, any term of this Agreement may be amended, and the observance of any
term of this Agreement may be waived (either generally or in a particular
instance and either retroactively or prospectively), only with the written
consent of the Company and the holders of a majority of the Common Stock issued
or issuable upon conversion of the Series A, Series B, Series C, Series D and
Series E Preferred Stock, so long as such amendment or waiver does not treat
the holders of Common Stock issued or issuable upon conversion of a particular
Series of Preferred Stock differently than the holders of Common Stock issued
or issuable upon conversion of another Series of Preferred Stock. Any amendment
or waiver effected in accordance with any applicable provision of this
Agreement shall be binding upon each holder of any such Series A, Series B,
Series C, Series D or Series E Preferred Stock (including the Common Stock into
which such Preferred Stock are convertible) each future party to this
Agreement, and the Company.
5.8 SEVERABILITY. If one or more provisions of this Agreement
are held to be unenforceable under applicable law, such provision shall be
excluded from this Agreement and the balance of the Agreement shall be
interpreted as if such provision were so excluded and shall be enforceable in
accordance with its terms.
5.9 ASSIGNMENT. Except as provided in Sections 1.13 and 3.6,
neither this Agreement nor the rights and obligations contained herein may
be assigned by an Investor without the prior written consent of the Company.
Any assignment in violation of the preceding sentence shall be void.
5.10 ENTIRE AGREEMENT. This Agreement constitutes the full
and entire understanding and agreement between the parties with regard to the
subjects hereof and thereof.
5.11 AGGREGATION OF STOCK. All shares of the Company's Common
Stock or Preferred Stock held or acquired by affiliated venture capital or
partnerships or limited or general
17.
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partners of such partnerships shall be aggregated together for the purpose of
determining the availability of any rights under this Agreement.
5.12 TERMINATION OF PRIOR RIGHTS AGREEMENT. This Agreement
amends and supersedes the Prior Rights Agreement. The Prior Rights Agreement
was amended pursuant to Section 5.7 of that agreement pursuant to the written
consent of the company and the holders of a majority of the Common Stock issued
or issuable upon conversion of the Series A, Series B, Series C and Series D
Preferred Stock, and, with respect to Section 1 of the Prior Rights Agreement
by the holders of a majority of the Registrable Securities and with respect to
Section 4 of the Prior Rights Agreement by a majority of the shares held by the
Major Investors (as defined in the Prior Rights Agreement).
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first above written.
BIOSTAR, INC.
By: /s/ Xxxxx X. Xxxxxxxxxx
-----------------------------
Xxxxx X. Xxxxxxxxxx, President
Address: 0000 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
INVESTORS:
XXXXXXX XXXXXXX XXXXXXXX & XXXXX VI
By:
-----------------------------
A general partner
Address: 0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
HILL PARTNERSHIP III
By: Xxxx, Xxxxxx Ventures
A Limited Partnership
By:
-----------------------------
A general partner
Address: 000 Xxxxxxxx Xxxxxx
Xxxxxxx, XX 00000
18.
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MARQUETTE VENTURE PARTNERS II, L.P.
By: Marquette General II, L.P.
its General Partner
By:
-----------------------------
An authorized signatory
Address: 000 Xxxx Xxxx Xxxx,
Xxxxx 000
Xxxxxxxxx, XX 00000
MVP II AFFILIATES FUND, L.P.
By: Marquette General II,
its General Partner
By:
-----------------------------
An authorized signatory
Address: 000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxxxxxx, XX 00000
INTEGRAL CAPITAL PARTNERS, L.P.
By: Integral Capital Management, L.P.,
its General Xxxxxx
By:
-----------------------------
Its general partner
Address: Two Embarcadero Place
0000 Xxxx Xxxx
Xxxx Xxxx, XX 00000
19.
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INTEGRAL CAPITAL PARTNERS INTERNATIONAL, C.V.
By: Integral Capital Management, L.P.,
its investment General Partner
By:
-----------------------------
Its general partner
Address: Two Embarcadero Place
0000 Xxxx Xxxx
Xxxx Xxxx, XX 00000
XXXXXXX X. XXXXX, L.P.
By:
-----------------------------
Address: 00000 Xxxxxxxx Xxxxx, X.X.
Xxxxxxxxx, XX 00000
DOMINION VENTURES, INC.
By:
-----------------------------
Address:
SKANDIGEN AB
By:
-----------------------------
Address: Xxxxxxxxxxxxxx 00
X-000 00
Xxxxxxxxx, Xxxxxx
20.
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AB XXXXXX XXXXXXX & CO.
By:
-----------------------------
Address: Skandigen AB
x/x Xxxxxxx Xxxxxx
Xxxxxxxxxxxxxx 00
X-Xxx 00
Xxxxxxxxx, Xxxxxx
BMPI LIQUIDATING TRUST
By:
-----------------------------
Address: c/o Colorado Venture
Management Inc.
0000 Xxxxx Xxxxxx, Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
XXXXXX X. XXXXXXX
By:
-----------------------------
Address: c/o BioStar, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
XXXX X. BEER
By:
-----------------------------
Address: c/o BioStar, Inc.
0000 Xxxxxxx Xxxx
Xxxxxxx, XX 00000
XXXXXX X. XXXXXXXXX TRUST FOR
XXXXXXXX XXXXXX XXXXXXXXX
By:
-----------------------------
Trustee
Address:
21.
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XXXXXX X. XXXXXXXXX TRUST FOR
XXXXXX XXXXX XXXXXXXXX
By:
-----------------------------
Trustee
Address:
GC&H INVESTMENTS
By:
-----------------------------
Address: c/o Cooley Godward LLP
Xxx Xxxxxxxx Xxxxx
00xx Xxxxx
Xxx Xxxxxxxxx, XX 00000-0000
KPCB VI FOUNDERS FUND
By:
-----------------------------
A general partner
Address: 0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
XXXXXXXX VI
By:
-----------------------------
A general partner
22.
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XXXXXXXX ASSOCIATES
By:
-------------------------
A general partner
Address: 0000 Xxxx Xxxx Xx., Xxxxx 000
Xxxxx Xxxx, XX 00000
XXXXX XXXXXX
-----------------------------
Xxxxx Xxxxxx
Address: Xxxxx Xxxxxx & Associates
000 X. 00xx Xxxxxx
Xxxxxx Xxxx, XX 00000
23.
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SCHEDULE A
SCHEDULE OF INVESTORS
Xxxxxxx Xxxxxxx Xxxxxxxx & Xxxxx VI
Xxxx Partnership III
Marquette Venture Partners II, L.P.
MVP II Affiliates Fund L.P.
Integral Capital Partners
Integral Capital Partners International
Skandigen AB
BMPI Liquidating Trust
Xxxxxx Xxxxxxx
KPCB VI Founders Fund
Xxxxxxxx VI
Xxxxxxxx Associates
Xxxxxxxx Medical Partners
Xxxxxxx X. Xxxxx, L.P.
Dominion Ventures, Inc.
AB Xxxxxx Xxxxxxx & Co.
Xxxxx X. Xxxxxxxxxx
Xxxxxx X. XxXxxxx
Xxxx X. Beer
Xxxxxx X. Xxxxxxxxx Trust for Xxxxxxxx Xxxxxx Xxxxxxxxx
Xxxxxx X. Xxxxxxxxx Trust for Xxxxxx Xxxxx Xxxxxxxxx
GC&H Investments
Xxxxx Xxxxxx
24.
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AMENDMENT TO RESTATED INVESTORS' RIGHTS AGREEMENT
Section 1.1(c) of the Restated Investors' Rights Agreement dated as of
June 27, 1994, as amended, by and among BioStar, Inc. and the investors listed
on Schedule A thereto (the "Investors' Rights Agreement") shall be amended and
restated to read in its entirety as follows:
(a) The term "REGISTRABLE SECURITIES" means (1) the
Common Stock issuable or issued upon conversion of the Series A Preferred
Stock, (2) the Common Stock issuable upon conversion of the Series B Preferred
Stock, (3) the Common Stock issuable upon conversion of the Series B Preferred
Stock issuable upon exercise of a warrant potentially exercisable for a maximum
of 60,750 shares of the Company's Series B Preferred Stock (the "Series B
Warrant") issued to DVI pursuant to that certain Warrant to Purchase Shares of
Series B Preferred Stock, dated November 2, 1992, (4) the Common Stock issuable
upon conversion of the Series C Preferred Stock issuable upon conversion or
exercise of a convertible instrument potentially convertible into a maximum of
1,600,000 shares of the Company's Series C Preferred Stock (the "Convertible
Instrument") issued to the Trust pursuant to that certain Asset Purchase
Agreement dated June 17, 1992, by and between the Company and the Trust (the
"Asset Purchase Agreement"), (5) the Common Stock issuable upon conversion of
the Series D Preferred Stock, (6) the Common Stock issuable upon conversion of
the Series E Preferred Stock, (7) the Common Stock issuable upon conversion of
the Series E Preferred Stock issuable upon exercise of warrants potentially
exercisable for a maximum of 53,357 shares of the Company's Series E Preferred
Stock issued to DVI pursuant to that certain Warrant to Purchase shares of
Series D Preferred Stock, dated February 18, 1994, (8) the Common Stock
issuable upon exercise of warrants potentially exercisable for a maximum of
2,571,429 shares of the Company's Common Stock, issued pursuant to that certain
Note and Warrant Purchase Agreement dated as of March 20, 1996 by and between
the Company and various investors, (9) the Common Stock issuable upon
conversion of the Series E Preferred Stock issuable upon exercise of warrants
potentially exercisable for a maximum of 85,714 shares of the Company's Series
E Preferred stock issued to Silicon Valley Bank pursuant to that certain Loan
and Security Agreement, dated September 15, 1995 and the Common Stock issuable
upon conversion of the Series E Preferred Stock issuable upon exercise of
warrants potentially exercisable for a maximum of 1,000,000 shares of the
Company's Series E Preferred Stock issued to Venture Lending, a Division of
Cupertino National Bank and Trust pursuant to that certain Bridge Loan
Agreement, dated April 30, 1997, (10) the Common Stock issuable upon conversion
of the Series F Preferred Stock issuable upon exercise of warrants potentially
exercisable for a maximum of 2,238,000 shares of the Company's Series F
Preferred Stock (the "Series F Warrants") and (11) any Common Stock of the
Company issued (or issuable upon the conversion or exercise of any warrant,
right or other security which is issued as) a dividend or other distribution
with respect to, or in exchange for or in replacement of, such Series A, Series
B, Series C, Series D, Series E or Series F Preferred Stock or Common Stock,
excluding in all cases, however, any Registrable Securities sold by a person in
a transaction in which his rights under this Section 1 are not assigned;"
The introductory paragraph to Section 2.1 of the Investors' Rights
Agreement shall be amended and restated to read in its entirety as follows:
1.
26
"2.1 DELIVERY OF FINANCIAL STATEMENTS. The Company shall deliver to each
Investor and Warrant Investor who holds at least an aggregate of 400,000 shares
of the Series A, Series B, Series C, Series D, Series E or Series F Preferred
Stock of the Company (or the common stock issued upon conversion thereof)
("Major Investor"):"
Section 3.1 of the Investors' Rights Agreement shall be amended and
restated to read in its entirety as follows:
"3.1 GENERAL. No party to this Agreement other than the Company shall sell,
assign, transfer, or in any other manner dispose of or alienate, or transfer or
assign any interest in, any or all of the Shares (as such term is defined
below) which now or hereafter may be held or owned by them to any person or
entity unless such party (for purposes of this Section 3 only referred to as
"Offeror") shall have first made the written offer to sell as hereinafter
described, and the offered Shares shall not have been purchased, within the
time hereinafter provided.
For purposes of this Section 3, "Shares" shall include and be deemed
to mean: (i) Series A Preferred Stock, (ii) Series B Preferred Stock, (iii)
Series C Preferred Stock, (iv) Series D Preferred Stock, (v) Series E Preferred
Stock, (vi) Series F Preferred Stock, (vii) the Common Stock issued or issuable
upon conversion of the Series A, Series B, Series C, Series D, Series E or
Series F Preferred Stock, and (vii) any Common Stock of the Company issued as
(or issuable upon the conversion or exercise of any warrant, right or other
security which is issued as) a dividend or other distribution with respect to,
or in exchange for or in replacement of, such Series A, Series B, Series C,
Series D, Series E or Series F Preferred Stock or Common Stock."
Section 4.2 of the Investors' Rights Agreement shall be amended and
restated to read in its entirety as follows:
"4.2 ELECTION TO EXERCISE. Within ten (10) days after receipt of the
Notice, the Major Investor may elect to purchase or obtain, at the price and on
the terms specified in the Notice, up to that portion of such Company Shares
which equals the proportion that the number of shares of Common Stock issued
and held, or issuable upon conversion of the Series A, Series B, Series C,
Series D, Series E and Series F Preferred Stock then held, by such Major
Investor bears to the total number of shares of Common Stock (assuming
conversion of the Series A, Series B, Series C, Series D, Series E and Series F
Preferred Stock and the exercise or conversion of all outstanding options,
warrants and other instruments convertible into or exercisable for either
Common Stock or securities convertible into or exercisable for Common Stock) of
the Company then outstanding."
Section 5.7 of the Investors' Rights Agreement shall be amended and
restated to read in its entirety as follows:
"5.7 AMENDMENTS AND WAIVERS. Except with respect to Sections 1 and 4, any
term of this Agreement may be amended, and the observance of any term of this
Agreement may be waived (either generally or in a particular instance and
either retroactively or prospectively), only with the written consent of the
Company and the holders of a majority of the Common Stock issued or issuable
upon conversion of the Series A, Series B, Series C, Series D, Series E and
Series F
2.
27
Preferred Stock, so long as such amendment or waiver does not treat the holders
of Common Stock issued or issuable upon conversion of a particular series of
Preferred Stock differently than the holders of Common Stock issued or issuable
upon conversion of another series of Preferred Stock. Any amendment or waiver
effected in accordance with any applicable provision of this Agreement shall be
binding upon each holder of any such Series A, Series B, Series C, Series D,
Series E or Series F Preferred Stock (including the Common Stock into which
such Preferred Stock are convertible) each future party to this Agreement, and
the Company."
3.
