SHAREHOLDER AGREEMENT
TABLE OF CONTENTS
| Page | ||||
1. VOTING PROVISIONS REGARDING BOARD |
1 | |||
1.1 Size of the Board |
1 | |||
1.2 Board Composition |
1 | |||
1.3 Matters Requiring Certain Directors’ Approval |
2 | |||
1.4 Failure to Designate a Board Member |
2 | |||
1.5 Removal of Board Members |
3 | |||
1.6 No Liability for Election of Recommended Directors |
3 | |||
1.7 Other Board Matters |
3 | |||
2. INFORMATION RIGHTS OF MAJOR INVESTORS |
3 | |||
2.1 Delivery of Financial Statements |
3 | |||
2.2 Inspection |
4 | |||
2.3 Observation Rights |
5 | |||
2.4 Termination of Information and Observation Rights |
5 | |||
2.5 Confidentiality |
5 | |||
3. RIGHTS TO FUTURE STOCK ISSUANCES |
5 | |||
3.1 Right of First Offer |
5 | |||
3.2 Termination |
7 | |||
4. AGREEMENT AMONG THE COMPANY AND THE SHAREHOLDERS REGARDING TRANSFERS OF SHARES |
7 | |||
4.1 Rights of Refusal |
7 | |||
4.2 Right of Co-Sale |
9 | |||
4.3 Effect of Failure to Comply |
11 | |||
5. CALL RIGHT |
11 | |||
5.1 Call Right |
11 | |||
5.2 Notice |
11 | |||
5.3 Purchase Price |
11 | |||
5.4 Closing |
12 | |||
6. REMEDIES |
12 | |||
6.1 Covenants of the Company |
12 | |||
6.2 Irrevocable Proxy |
13 | |||
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TABLE OF CONTENTS
(continued)
(continued)
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6.3 Specific Enforcement |
13 | |||
6.4 Remedies Cumulative |
13 | |||
7. “MARKET STAND-OFF” AGREEMENT |
13 | |||
8. TERM |
14 | |||
9. MISCELLANEOUS |
14 | |||
9.1 Additional Parties |
14 | |||
9.2 Transfers |
14 | |||
9.3 Successors and Assigns |
15 | |||
9.4 Governing Law |
15 | |||
9.5 Counterparts; Facsimile |
15 | |||
9.6 Titles and Subtitles |
15 | |||
9.7 Notices |
15 | |||
9.8 Consent Required to Amend, Terminate or Waive |
15 | |||
9.9 Delays or Omissions |
16 | |||
9.10 Severability |
16 | |||
9.11 Entire Agreement |
16 | |||
9.12 Legend on Share Certificates |
16 | |||
9.13 Stock Splits, Stock Dividends, Etc |
17 | |||
9.14 Manner of Voting |
17 | |||
9.15 Further Assurances |
17 | |||
9.16 Dispute Resolution |
17 | |||
9.17 Costs of Enforcement |
17 | |||
9.18 Aggregation of Stock |
17 | |||
9.19 Spousal Consent |
17 | |||
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THIS SHAREHOLDER AGREEMENT (this “Agreement”) is made and entered into as of this
25th day of April, 2008, by and among Compact Particle Acceleration Corporation, a
Wisconsin corporation (the “Company”), TomoTherapy Incorporated, a Wisconsin corporation
(“TomoTherapy”), each holder of the Company’s Series A Common Stock, $0.001 par value per share
(“Series A Common Stock”), listed on Schedule A (each a “Series A Holder” and collectively, the
“Series A Holders”) and each holder of Series B Common Stock, $0.001 par value per share (“Series B
Common Stock” and, together with the Series A Common Stock and all other common stock as described
in the Articles (as defined below), the “Common Stock”), listed on Schedule B (each an “Series B
Holder” and collectively, the “Series B Holders”) (TomoTherapy, the Series A Holders and the Series
B Holders, together with any subsequent investors or transferees who become parties hereto pursuant
to Sections 9.1 or 9.2 below, are referred to herein each as a “Shareholder” and collectively as
the “Shareholders”). Capitalized terms not otherwise defined herein have the meanings attributed
to them in Exhibit A, which is incorporated herein by reference.
RECITALS
WHEREAS, this Agreement is being executed and delivered pursuant to that certain Stock
Purchase Agreement, dated as of April 25, 2008, by and between the Company and the parties named
therein (as amended, restated, and otherwise modified from time to time, the “Purchase Agreement”);
and
WHEREAS, the parties desire to enter into this Agreement for the purpose of regulating certain
aspects of the Shareholders’ relationships with regard to the Company, the right, among other
rights, to designate the election of certain members of the Board of Directors of the Company (the
“Board”), and certain restrictions on, and rights and obligations with respect to, the Common Stock
owned by the Shareholders.
NOW, THEREFORE, the parties agree as follows:
1. Voting Provisions Regarding Board.
1.1 Size of the Board. Each Shareholder agrees to vote, or cause to be voted, all
Shares owned by such Shareholder, or over which such Shareholder has voting control, from time to
time and at all times, in whatever manner as shall be necessary to ensure that the size of the
Board shall be at least five (5) directors.
1.2 Board Composition. Each Shareholder agrees to vote, or cause to be voted, all
Shares owned by such Shareholder, or over which such Shareholder has voting control, from time to
time and at all times, in whatever manner as shall be necessary to ensure that at each annual or
special meeting of shareholders at which an election of directors is held or pursuant to any
written consent of the shareholders, the following persons shall be elected to the Board:
(a) One individual designated by the holders of a majority of the Series A Common Stock
(the “Series A Director”); provided, however, that those shares of Series
A Common Stock held by TomoTherapy shall be ineligible to vote to designate such
individual until the Call Right (as defined below) is exercised pursuant to Section 5
(b) One individual designated by the holders of a majority of the Series B Common Stock
(the “Series B Director”);
(c) Two individuals designated by TomoTherapy (each a “TomoTherapy Director”); and
(d) The Company’s Chief Executive Officer, or if there not be one, the senior ranking
officer of the Company (in lieu of the CEO) (the “CEO Director”), provided that if for any
reason the CEO Director shall cease to serve in such role for the Company, each of the
Shareholders shall promptly vote their respective Shares (i) to remove such person from the
Board if such person has not resigned as a member of the Board, and (ii) to elect such
person’s replacement as the new CEO Director.
1.3 Matters Requiring Certain Directors’ Approval. The Company hereby covenants and
agrees that it shall not, without the approval of the Company’s Board, including at least one
TomoTherapy Director and at least one of either the Series A Director or the Series B Director:
(a) make, or permit any subsidiary to make, any loan or advance to any Person,
including, without limitation, any employee or director of the Company or any subsidiary,
except advances and similar expenditures in the ordinary course of business or under the
terms of an employee stock or option plan approved by the Board;
(b) guarantee, directly or indirectly, or permit any subsidiary to guarantee, directly
or indirectly, any indebtedness except for trade accounts of the Company or any subsidiary
arising in the ordinary course of business;
(c) incur any aggregate indebtedness in excess of $1,000,000 that is not already
included in a budget approved by the Board, other than trade credit incurred in the ordinary
course of business;
(d) change the principal business of the Company, enter new lines of business, or exit
the current line of business;
(e) sell, assign, license, pledge, or encumber material technology or intellectual
property, other than licenses granted in the ordinary course of business or those agreements
substantially in place as of the date of the Purchase Agreement; or
(f) declare or make any dividend or other distribution.
1.4 Failure to Designate a Board Member. In the absence of any designation from the
Persons or groups with the right to designate a director as specified above, the director
previously designated by them and then serving shall be reelected if still eligible to serve as
provided herein.
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1.5 Removal of Board Members. Each Shareholder also agrees to vote, or cause to be
voted, all Shares owned by such Shareholder, or over which such Shareholder has voting control,
from time to time and at all times, in whatever manner as shall be necessary to ensure that:
(a) no director elected pursuant to Sections 1.2 or 1.4 of this Agreement may be
removed from office, unless the Person(s) originally entitled to designate or approve such
director or occupy such Board seat pursuant to Section 1.2 is no longer so entitled to
designate or approve such director or occupy such Board seat;
(b) any vacancies created by the resignation, removal or death of a director elected
pursuant to Sections 1.2 or 1.4 shall be filled pursuant to the provisions of this
Section 1; and
(c) upon the request of any party entitled to designate a director as provided in
Section 1.2 to remove such director, such director shall be removed.
All Shareholders agree to execute any written consents required to perform the obligations of
this Agreement, and the Company agrees at the request of any party entitled to designate directors
to call a special meeting of Shareholders for the purpose of electing directors.
1.6 No Liability for Election of Recommended Directors. No Shareholder, nor any
Affiliate of any Shareholder, shall have any liability as a result of designating a person for
election as a director for any act or omission by such designated person in his or her capacity as
a director of the Company, nor shall any Shareholder have any liability as a result of voting for
any such designee in accordance with the provisions of this Agreement.
1.7 Other Board Matters. Each Shareholder shall take such actions as may be
necessary, including without limitation, the voting of Shares to ensure that (a) the Board shall
meet at least quarterly unless otherwise agreed by a vote of the majority of the Board and (b) the
Company will bind directors and officers insurance with a carrier and in an amount satisfactory to
the Board.
2. Information Rights of Major Investors.
2.1 Delivery of Financial Statements. The Company shall deliver to each 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, (i) a balance sheet as of the end of such year, (ii)
statements of income and of cash flows for such year, and (iii) a statement of shareholders’
equity as of the end of such year;
(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, unaudited
statements of income and of cash flows for such fiscal quarter, and an unaudited balance
sheet and a statement of shareholders’ equity as of the end of such fiscal quarter, all
prepared in accordance with GAAP (except that such financial
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statements may (i) be subject to normal year-end audit adjustments and (ii) not
contain all notes thereto that may be required in accordance with GAAP);
(c) 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, 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 Common Stock issuable upon conversion or exercise of any outstanding securities
convertible or exercisable for Common Stock and the exchange ratio or exercise price
applicable thereto, and the number of shares of issued stock options and stock options not
yet issued but reserved for issuance, if any, all in sufficient detail as to permit the
Major Investors to calculate their respective percentage equity ownership in the Company,
and certified by the chief financial officer or chief executive officer of the Company as
being true, complete and correct; and
(d) as soon as practicable, but in any event within thirty (30) days of the end of each
month, an unaudited income statement and statement of cash flows for such month, and an
unaudited balance sheet and statement of shareholders’ equity as of the end of such month,
all prepared in accordance with GAAP (except that such financial statements may (i) be
subject to normal year-end audit adjustments and (ii) not contain all notes thereto that may
be required in accordance with GAAP).
If, for any period, the Company has any subsidiary whose accounts are consolidated with those of
the Company, then in respect of such period the financial statements delivered pursuant to the
foregoing sections shall be the consolidated and consolidating financial statements of the Company
and all such consolidated subsidiaries.
Notwithstanding anything else in this Section 2.1 to the contrary, the Company may cease providing
the information set forth in this Section 2.1 during the period starting with the date sixty (60)
days before the Company’s good-faith estimate of the date of filing of a registration statement if
it reasonably concludes it must do so to comply with the SEC rules applicable to such registration
statement and related offering; provided that the Company’s covenants under this Section 2.1 shall
be reinstated at such time as the Company is no longer actively employing its commercially
reasonable efforts to cause such registration statement to become effective; provided, further,
that the Company will cease providing the information set forth in this Section 2.1 upon the
request of TomoTherapy.
2.2 Inspection. The Company shall permit each Major Investor, at such Major
Investor’s expense, to visit and inspect the Company’s properties and discuss the Company’s affairs
with its officers, during normal business hours of the Company as may be reasonably 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 that it reasonably and in good faith considers to
be a trade secret or confidential information (unless covered by an enforceable confidentiality
agreement, in form acceptable to the Company) or the disclosure of which would adversely affect the
attorney-client privilege between the Company and its counsel.
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2.3 Observation Rights. Upon written request of a Major Investor, a representative
(who is not a Person that the Board or TomoTherapy determines is, or is an Affiliate of, a
competitor of the Company or of TomoTherapy) designated by a Major Investor may attend all meetings
of the Board in a nonvoting observer capacity. Upon written request, the Company shall give such
representative copies of all notices, minutes, consents and other materials that it provides to its
directors at the same time and in the same manner as provided to such directors; provided, however,
that such representative shall agree to hold in confidence and trust and to act in a fiduciary
manner with respect to all information so provided; provided, further, that the Company reserves
the right to withhold any information and to exclude such representative from any meeting or
portion thereof if access to such information or attendance at such meeting could adversely affect
the attorney-client privilege between the Company and its counsel; result in disclosure of trade
secrets; is deemed by the Board to include competitive or sensitive customer-related matters of the
Company or of TomoTherapy; or result in a conflict of interests.
2.4 Termination of Information and Observation Rights. The covenants set forth in
Sections 2.1, 2.2, and 2.3 shall terminate and be of no further force or effect
when the Company first becomes subject to the periodic reporting requirements of Section 12(g) or
15(d) of the Exchange Act, whichever event occurs first.
2.5 Confidentiality. Each Shareholder agrees that such Shareholder will keep
confidential and will not disclose, divulge or use for any purpose (other than to monitor its
investment in the Company) any confidential information obtained from the Company pursuant to the
terms of this Agreement (including notice of the Company’s intention to file a registration
statement), unless such confidential information (a) is known or becomes known to the public in
general (other than as a result of a breach of this Section 2.5 by such Shareholder), (b) is or has
been independently developed or conceived by the Shareholder without use of the Company’s
confidential information, or (c) is or has been made known or disclosed to the Shareholder by a
third party without a breach of any obligation of confidentiality such third party may have to the
Company, provided, however, that a Shareholder may disclose confidential information (i) to its
attorneys, accountants, consultants and other professionals to the extent necessary to obtain their
services in connection with monitoring its investment in the Company; (ii) to any existing
Affiliate, partner, member, shareholder or wholly owned subsidiary of such Shareholder in the
ordinary course of business, provided that such Shareholder informs such Person that such
information is confidential and directs such Person to maintain the confidentiality of such
information; or (iii) as may otherwise be required by law in the reasonable written opinion of the
Shareholder’s legal counsel, provided that the Shareholder promptly notifies the Company of such
disclosure and takes reasonable steps to minimize the extent of any such required disclosure.
Notwithstanding the foregoing, each Shareholder agrees that it is restricted from disclosing any
such confidential information to any Person that is a competitor of the Company or of TomoTherapy.
For the avoidance of doubt, the Board shall determine whether such a Person is such a competitor
3. Rights to Future Stock Issuances.
3.1 Right of First Offer. Subject to the terms and conditions of this Section
3.1 and applicable securities laws, if the Company proposes to offer or sell any New
Securities, the
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Company shall first offer such New Securities to each Major Investor in accordance with the
following:
(a) The Company shall give notice (the “Offer Notice”) to each Major Investor, stating
(i) its bona fide intention to offer such New Securities, (ii) the number of such New
Securities to be offered, and (iii) the price and terms, if any, upon which it proposes to
offer such New Securities.
(b) By notification to the Company within twenty (20) days after the Offer Notice is
given, each Major Investor 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 New Securities which
equals the proportion that the Common Stock issued and held, or issuable (directly or
indirectly) upon conversion and/or exercise, as applicable, of any 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 Derivative
Securities). At the expiration of such twenty (20) day period, the Company shall promptly
notify each Major Investor that elects to purchase or acquire all the shares available to it
(each, a “Fully Exercising 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 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 New
Securities for which Major Investors were entitled to subscribe but that were not subscribed
for by the 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 any other Derivative Securities then held, by such Fully Exercising Investor bears to the
Common Stock issued and held, or issuable (directly or indirectly) upon conversion and/or
exercise, as applicable, of any other Derivative Securities then held, by all Fully
Exercising Investors who wish to purchase such unsubscribed shares. The closing of any sale
pursuant to this Section 3.1(b) shall occur on a date designated by the Company that is
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 3.1(c).
(c) If all New Securities referred to in the Offer Notice are not elected to be
purchased or acquired as provided in Section 3.1(b), the Company may, during the ninety (90)
day period following the expiration of the periods provided in Section 3.1(b), offer and
sell the remaining unsubscribed portion of such New 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 Offer Notice. If the Company does not enter into an agreement for the sale of the
New Securities 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 New Securities shall not be offered unless first re-offered to the Major
Investors in accordance with this Section 3.1.
(d) The right of first offer in this Section 3.1 shall not be applicable to (i)
Exempted Securities; (ii) shares of Common Stock issued in the IPO; and (iii) the
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issuance of 2nd Tranche Shares or 3rd Tranche Shares (as those
terms are defined in the Purchase Agreement).
(e) Notwithstanding any provision hereof to the contrary, in complying with the
provisions of this Section 3.1, 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 Section 3.1(b) before giving
effect to the issuance of such New Securities. The closing of such sale shall occur on a
date designated by the Company that is within sixty (60) days of the date notice is given to
the Major Investors.
3.2 Termination. The covenants set forth in Section 3.1 shall terminate and be of no
further force or effect (i) immediately before the consummation of the IPO or (ii) when the Company
first becomes subject to the periodic reporting requirements of Section 12(g) or 15(d) of the
Exchange Act, whichever event occurs first.
4. Agreement Among the Company and the Shareholders Regarding Transfers of Shares.
4.1 Rights of Refusal.
(a) Grant. Subject to the terms of this Section 4, each Shareholder hereby
unconditionally and irrevocably grants to TomoTherapy a Right of First Refusal to purchase
all or any portion of the Shares that are subject to a Proposed Transfer, at the same price
and on the same terms and conditions as those offered to the Prospective Transferee, or
pursuant to this Agreement in the absence of any such ascertainable price, terms and
conditions.
(b) Notice. Any Shareholder proposing to make a Proposed Transfer must deliver
a Proposed Transfer Notice to TomoTherapy and the Company not later than ninety (90) days
prior to the consummation of such Proposed Transfer. Such Proposed Transfer Notice shall
contain the material terms and conditions (including price and form of consideration) of the
Proposed Transfer and the identity of the Prospective Transferee. To exercise its Right of
First Refusal under this Section 4, TomoTherapy must deliver an Exercise Notice to the
selling Shareholder within fifteen (15) days after delivery of the Proposed Transfer Notice.
(c) Grant of Secondary Refusal Right to the Company. Subject to the terms of
Section 5 below, each Shareholder hereby unconditionally and irrevocably grants to the
Company a Secondary Refusal Right to purchase all or any portion of the Shares not purchased
by TomoTherapy pursuant to the Right of First Refusal, as provided in this Section 4.1(c).
If TomoTherapy does not intend to exercise its Right of First Refusal with respect to all
Shares subject to a Proposed Transfer, TomoTherapy must deliver a Non-exercise Notice to the
Company and the selling Shareholder to that effect no later than fifteen (15) days after the
selling Shareholder delivers the Proposed Transfer Notice
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pursuant to Section 4.1(b). To exercise its Secondary Refusal Right, the Company must
deliver an Exercise Notice to the selling Shareholder and TomoTherapy within ten (10) days
after TomoTherapy’s deadline for its delivery of the Non-exercise Notice as provided in the
preceding sentence.
(d) Grant of Tertiary Refusal Rights to the Shareholders. Subject to the terms
of Section 5 below, each Shareholder hereby unconditionally and irrevocably grants to each
other Shareholder (other than TomoTherapy) a Tertiary Refusal Right to purchase all or any
portion of the Shares not purchased by TomoTherapy pursuant to its exercise of the Right of
First Refusal or by the Company pursuant to its exercise of the Secondary Refusal Right, as
provided in this Section 4.1(d). If the Company does not intend to exercise its Secondary
Refusal Right with respect to all Shares subject to a Proposed Transfer that were not
purchased by TomoTherapy pursuant to the Right of First Refusal, the Company must deliver a
Non-exercise Notice to the selling Shareholder and to each other Shareholder to that effect,
accompanied by a copy of the Proposed Transfer Notice, no later than thirty (30) days after
the selling Shareholder delivers the Proposed Transfer Notice pursuant to Section 4.1(b).
To exercise its Tertiary Refusal Right, a Shareholder (other than TomoTherapy) must deliver
an Exercise Notice to the selling Shareholder and the Company within forty (40) days after
the Company’s deadline for its delivery of the Non-exercise Notice as provided in the
preceding sentence.
(e) Undersubscription of Shares. If options to purchase under this Section
4 have been exercised by TomoTherapy, the Company and the Shareholders (other than
TomoTherapy) with respect to some but not all of the Shares subject to a Proposed Transfer
by the end of the 40-day period specified in the last sentence of Section 4.1(d) (the
“Shareholder Notice Period”), then the Company shall, immediately after the expiration of
the Shareholder Notice Period, send written notice (the “Company Undersubscription Notice”)
to those Shareholders who fully exercised their Tertiary Refusal Right within the
Shareholder Notice Period (the “Exercising Shareholders”). Each Exercising Shareholder
shall, subject to the provisions of this Section 4.1(e), have an additional option to
purchase all or any part of the balance of any such remaining unsubscribed Shares on the
terms and conditions set forth in the Proposed Transfer Notice. To exercise such option, an
Exercising Shareholder must deliver an Undersubscription Notice to the selling Shareholder
and the Company within ten (10) days after the expiration of the Shareholder Notice Period.
In the event there are two or more such Exercising Shareholders that choose to exercise the
last-mentioned option for a total number of remaining shares in excess of the number
available, the remaining Shares available for purchase under this Section 4.1(e) shall be
allocated to such Exercising Shareholders pro rata based on the number of Shares such
Exercising Shareholders have elected to purchase pursuant to the Tertiary Refusal Right
(without giving effect to any Shares that any such Exercising Shareholder has elected to
purchase pursuant to the Company Undersubscription Notice). If the options to purchase the
remaining Shares are exercised in full by the Exercising Shareholders, the Company shall
immediately notify all of the Exercising Shareholders and the selling Shareholder of that
fact.
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(f) Forfeiture of Rights. Notwithstanding the foregoing, if the total number
of Shares that TomoTherapy, the Company and the Shareholders (other than TomoTherapy) have
agreed to purchase pursuant to the exercise of the Right of First Refusal, the Secondary
Refusal Right and the Tertiary Refusal Right, respectively, is less than the total number of
Shares subject to the Proposed Transfer, then TomoTherapy, the Company and the Shareholders
(other than TomoTherapy) shall be deemed to have forfeited any right to purchase such
Shares, and the selling Shareholder shall be free to sell all, but not less than all, of
such Shares to the Prospective Transferee on terms and conditions substantially similar to
(and in no event more favorable to the Proposed Transferee than) the terms and conditions
set forth in the Proposed Transfer Notice, it being understood and agreed that (i) any such
sale or transfer shall be subject to the other terms and restrictions of this Agreement,
including without limitation the terms and restrictions set forth in this Section 4; (ii)
any future Proposed Transfer shall remain subject to the terms and conditions of this
Agreement, including this Section 4; and (iii) such sale shall be consummated within ninety
(90) days after receipt of the Proposed Transfer Notice by the Company and, if such sale is
not consummated within such ninety (90) day period, such sale shall again become subject to
the Right of First Refusal, the Secondary Refusal Right and the Tertiary Refusal Right on
the terms set forth herein.
(g) Consideration; Closing. If the consideration proposed to be paid for the
Shares subject to a Proposed Transfer is in property, services or other non-cash
consideration, TomoTherapy, the Company or such Shareholder may pay the cash value
equivalent thereof, as determined in good faith by TomoTherapy and as set forth in its
Exercise Notice. If the Proposed Transfer is involuntary or by operation of law, the
purchase price to be paid by TomoTherapy, the Company and the purchasing Shareholders
hereunder shall be equal to appraised value for the Shares being transferred, as determined
by an appraiser selected those purchasing a majority of the Shares being purchased. The
closing of the purchase by TomoTherapy, the Company and/or the Shareholders of Shares
subject to a Proposed Transfer pursuant to this Section 4 shall take place, and all payments
from TomoTherapy, the Company and the Shareholders shall have been delivered to the selling
Shareholder, by the later of (i) the date specified in the Proposed Transfer Notice as the
intended date of the Proposed Transfer and (ii) ninety (90) days after delivery of the
Proposed Transfer Notice.
(h) Prohibited Transferees. Notwithstanding the foregoing, no Shareholder
shall transfer any Shares to any Person that, in the determination of the Board or
TomoTherapy, directly or indirectly competes with the Company or TomoTherapy.
4.2 Right of Co-Sale.
(a) Exercise of Right. If any Shares subject to a Proposed Transfer are not
purchased pursuant to Section 4.1 above and thereafter is to be sold to a
Prospective Transferee, each respective Shareholder may elect to exercise its Right of
Co-Sale and participate on a pro rata basis in the Proposed Transfer as set forth in Section
4.2(b) below and otherwise on the same terms and conditions specified in the Proposed
Transfer Notice. Each Shareholder who desires to exercise its Right of Co-Sale must give
the selling Shareholder written notice to that effect within fifteen (15) days after the
deadline
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for delivery of the Secondary Notice described above, and upon giving such notice such
Shareholder shall be deemed to have effectively exercised the Right of Co-Sale.
(b) Shares Includable. Each Shareholder who timely exercises such
Shareholder’s Right of Co-Sale by delivering the written notice provided for above in
Section 4.2(a) may include in the Proposed Transfer all or any part of such
Shareholder’s Common Stock equal to the product obtained by multiplying (i) the aggregate
number of Shares subject to the Proposed Transfer (excluding Shares purchased by the Company
or the Shareholders pursuant to the Right of First Refusal, Secondary Refusal Right or
Tertiary Refusal Right) by (ii) a fraction, the numerator of which is the number of Shares
owned by such Shareholder immediately before consummation of the Proposed Transfer
(including any shares that such Shareholder has agreed to purchase pursuant to the Tertiary
Refusal Right) and the denominator of which is the total number of Shares of owned, in the
aggregate, by all Shareholders immediately prior to the consummation of the Proposed
Transfer (including any shares that all Shareholders have collectively agreed to purchase
pursuant to the Tertiary Refusal Right).
(c) Delivery of Certificates. Each Shareholder shall effect its participation
in the Proposed Transfer by delivering to the transferring Shareholder, no later than
fifteen (15) days after such Shareholder’s exercise of the Right of Co-Sale, one or more
stock certificates, properly endorsed for transfer to the Prospective Transferee,
representing the number of Shares that such Shareholder elects to include in the Proposed
Transfer.
(d) Purchase Agreement. The parties hereby agree that the terms and conditions
of any sale pursuant to this Section 4.2 will be memorialized in, and governed by, a written
purchase and sale agreement with customary terms and provisions for such a transaction and
the parties further covenant and agree to enter into such an agreement as a condition
precedent to any sale or other transfer pursuant to this Section 4.2.
(e) Deliveries. Each stock certificate a Shareholder delivers to the selling
Shareholder pursuant to Section 4.2(c) above will be transferred to the Prospective
Transferee against payment therefor in consummation of the sale of the Shares pursuant to
the terms and conditions specified in the Proposed Transfer Notice and the purchase and sale
agreement, and the selling Shareholder shall concurrently therewith remit or direct payment
to each Shareholder the portion of the sale proceeds to which such Shareholder is entitled
by reason of its participation in such sale. If any Prospective Transferee refuses to
purchase securities subject to the Right of Co-Sale from any Shareholder exercising its
Right of Co-Sale hereunder, no Shareholder may sell any Shares to such Prospective
Transferee or Transferees unless and until, simultaneously with such sale, such Shareholder
purchases all securities subject to the Right of Co-Sale from such Shareholder on the same
terms and conditions (including the proposed purchase price) as set forth in the Proposed
Transfer Notice.
(f) Additional Compliance. If any Proposed Transfer is not consummated within
ninety (90) days after receipt of the Proposed Transfer Notice by the Company, the
Shareholders proposing the Proposed Transfer may not sell any Shares unless they first
comply in full with each provision of this Section 4. The exercise or election not to
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exercise any right by any Shareholder hereunder shall not adversely affect its right to
participate in any other sales of Shares subject to this Section 4.2.
4.3 Effect of Failure to Comply.
(a) Transfer Void; Equitable Relief. Any Proposed Transfer not made in
compliance with the requirements of this Agreement shall be null and void ab initio, shall
not be recorded on the books of the Company or its transfer agent and shall not be
recognized by the Company. Each party hereto acknowledges and agrees that any breach of
this Agreement would result in substantial harm to the other parties hereto for which
monetary damages alone could not adequately compensate. Therefore, the parties hereto
unconditionally and irrevocably agree that any non-breaching party hereto shall be entitled
to seek protective orders, injunctive relief and other remedies available at law or in
equity (including, without limitation, seeking specific performance or the rescission of
purchases, sales and other transfers of Shares not made in strict compliance with this
Agreement).
(b) Violation of Refusal Rights. If any Shareholder becomes obligated to sell
any Shares to TomoTherapy, the Company or any Shareholder under this Agreement and fails to
deliver such Shares in accordance with the terms of this Agreement, TomoTherapy, the Company
and/or such Shareholders may, at its option, in addition to all other remedies it may have,
send to such Shareholder the purchase price for such Shares as is herein specified and
transfer to the name of TomoTherapy, the Company or such Shareholder (or request that the
Company effect such transfer in the name of TomoTherapy or such Shareholder) on the
Company’s books the certificate or certificates representing the Shares to be sold.
5. Call Right.
5.1 Call Right. At any time after the second anniversary of the Initial Closing (as
defined in the Purchase Agreement), TomoTherapy shall have the continuing option (the “Call Right”)
to purchase all of the Series A Common Stock and twenty-three and sixteen hundredths percent (23
16/100%) of the Series B Common Stock (collectively, the “Call Shares”) in
accordance with the terms and conditions of this Section 5.
5.2 Notice. To exercise the Call Right, TomoTherapy shall provide to each Series A
Holder and each Series B Holder, written notice of its election to exercise the Call Right (the
“Call Notice”), which Call Notice shall set forth the Purchase Price (as defined below) to be paid
to each such Series A Holder and Series B Holder, as calculated in accordance with Section 5.3, and
the closing date of the purchase pursuant to Section 5.4.
5.3 Purchase Price. The total purchase price for Series A Common Stock Call Shares
(the “Series A Purchase Price”) and Series B Common Stock Call Shares (the “Series B Purchase
Price”), purchased pursuant to this Section 5 shall be an amount equal to the following formulas
for each separate purchase of such Series A Common Stock or Series B Common, as the case may be:
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| Series A Purchase Price = $1.00 * A * (1 + I)^(M/12) | ||||
| Series B Purchase Price = ($2.46 * B * (1.5^(M/12))) – ($2.46 * B) | ||||
| A = | The number of shares of Series A Common Stock to be purchased pursuant to the Call Right. | |||
| B = | The number of shares of Series B Common Stock to be purchased pursuant to the Call Right. | |||
| I = | If the total number of shares of Series A Common Stock that the selling Series A Holder has purchased or has a then-current right to purchase is greater than or equal to 2,000,000, then 0.2, but if less than 2,000,000, then 0. | |||
| M = | The number of full months between the relevant share purchase date and (i) if the holder failed to meet the holder’s obligation pursuant to its initial commitment to purchase stock in either the 2nd Tranche Sale or 3rd Tranche Sale (as defined in the Purchase Agreement), the date that the holder first failed to make such purchase, or (ii) if the holder fulfilled all obligations of the Transaction Agreements, the date of the sale pursuant to the Call Right. | |||
5.4 Closing. The closing of the purchase of the Call Shares by TomoTherapy shall
occur at the principal office of the Company on date designated by TomoTherapy that is on or before
fifteen (15) business days following TomoTherapy’s delivery of the Call Notice. At such closing,
TomoTherapy shall deliver to each selling Shareholder, against delivery of certificates duly
endorsed and stock powers representing the Call Shares held by such selling Shareholder, cash in an
amount equal to the Series A Purchase Price and the Series B Purchase Price, as applicable, for the
Call Shares held by such selling Shareholder, pursuant to a written purchase agreement between the
Company and each Shareholder, in which each Shareholder shall make all customary representations
and warranties given by sellers of a equity securities, including, without limitation,
representations and warranties as to: (1) binding execution of the purchase agreement; (2)
enforceability obligations under the purchase agreement; (3) authority, capacity and power to
execute and delivery the purchase agreement and the agreements contemplated thereby; (4) good and
marketable title to the Call Shares held by the selling Shareholder, free and clear of liens and
encumbrances; (5) proper approval of such proposed sale; and (6) no violation of any other
agreement to which the selling Shareholder is a party.
6. Remedies.
6.1 Covenants of the Company. The Company agrees to use its best efforts, within the
requirements of applicable law, to ensure that the rights granted under this Agreement are
effective and that the parties enjoy the benefits of this Agreement. Such actions include, without
limitation, the use of the Company’s best efforts to cause the nomination and election of the
directors as provided in this Agreement.
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6.2 Irrevocable Proxy. Each party to this Agreement hereby constitutes and appoints
the President and Treasurer of the Company, and each of them, with full power of substitution, as
the proxies of the party with respect to the matters set forth herein, including without
limitation, election of persons as members of the Board in accordance with Section 1 hereof and
hereby authorizes each of them to represent and to vote, if and only if the party (i) fails to vote
or (ii) attempts to vote (whether by proxy, in person or by written consent), in a manner which is
inconsistent with the terms of this Agreement, all of such party’s Shares in favor of the election
of persons as members of the Board determined pursuant to and in accordance with the terms and
provisions of this Agreement. The proxy granted pursuant to the immediately preceding sentence is
given in consideration of the agreements and covenants of the Company and the parties in connection
with the transactions contemplated by this Agreement and, as such, is coupled with an interest and
shall be irrevocable unless and until this Agreement terminates or expires pursuant to Section 8
hereof. Each party hereto hereby revokes any and all previous proxies with respect to the Shares
and shall not hereafter, unless and until this Agreement terminates or expires pursuant to Section
8 hereof, purport to grant any other proxy or power of attorney with respect to any of the Shares,
deposit any of the Shares into a voting trust or enter into any agreement (other than this
Agreement), arrangement or understanding with any Person, directly or indirectly, to vote, grant
any proxy or give instructions with respect to the voting of any of the Shares, in each case, with
respect to any of the matters set forth herein.
6.3 Specific Enforcement. Each party hereto acknowledges and agrees that every party
hereto will be irreparably damaged in the event any of the provisions of this Agreement are not
performed by the parties in accordance with their specific terms or are otherwise breached.
Accordingly, it is agreed that each of TomoTherapy, the Company and the Shareholders shall be
entitled to an injunction to prevent breaches of this Agreement, and to specific enforcement of
this Agreement and its terms and provisions in any action instituted in any court of the United
States or any state having subject matter jurisdiction.
6.4 Remedies Cumulative. All remedies, either under this Agreement or by law or
otherwise afforded to any party, shall be cumulative and not alternative.
7. “Market Stand-Off” Agreement. Each Holder hereby agrees that it will not, without the
prior written consent of the managing underwriter, during the period commencing on the date of the
final prospectus relating to the registration by the Company of Shares or any other equity
securities of the Company under the Securities Act on a registration statement on Form X-0, Xxxx
X-0 or Form S-3, and ending on the date specified by the Company and the managing underwriter (such
period not to exceed (x) one hundred eighty (180) days in the case of the IPO, which period may be
extended upon the request of the managing underwriter, to the extent required by any NASD rules,
for an additional period of up to fifteen (15) days if the Company issues or proposes to issue an
earnings or other public release within fifteen (15) days of the expiration of the 180-day lockup
period, or (y) ninety (90) days in the case of any registration other than the IPO, which period
may be extended upon the request of the managing underwriter, to the extent required by any NASD
rules, for an additional period of up to fifteen (15) days if the Company issues or proposes to
issue an earnings or other public release within fifteen (15) days of the expiration of the 90-day
lockup period), (i) lend; offer; pledge; sell; contract to sell; sell any option or contract to
purchase; purchase any option or contract to sell; grant any option, right, or warrant to purchase;
or otherwise transfer or dispose of, directly or indirectly, any
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Shares or any securities convertible into or exercisable or exchangeable (directly or indirectly)
for Common Stock (whether such Shares or any such securities are then owned by the Holder or are
thereafter acquired); or (ii) enter into any swap or other arrangement that transfers to another,
in whole or in part, any of the economic consequences of ownership of such securities, whether any
such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock
or other securities, in cash, or otherwise. The foregoing provisions of this Section 7 shall not
apply to the sale of any shares to an underwriter pursuant to an underwriting agreement, and shall
be applicable to the Shareholders only if all officers and directors are subject to the same
restrictions. The underwriters in connection with such registration are intended third-party
beneficiaries of this Section 7 and shall have the right, power and authority to enforce the
provisions hereof as though they were a party hereto. Each Shareholder further agrees to execute
such agreements as may be reasonably requested by the underwriters in connection with such
registration that are consistent with this Section 7 or that are necessary to give further effect
thereto. Any discretionary waiver or termination of the restrictions of any or all of such
agreements by the Company or the underwriters shall apply pro rata to all Shareholders subject to
such agreements, based on the number of shares subject to such agreements, except that,
notwithstanding the foregoing, the Company and the underwriters may, in their sole discretion,
waive or terminate these restrictions with respect to up to 1,000,000 shares of the Common Stock.
8. Term. This Agreement shall be effective as of the date hereof and shall continue in
effect until and shall terminate upon the earliest to occur of (a) the consummation of the IPO
(other than a registration statement relating either to the sale of securities to employees of the
Company pursuant to its stock option, stock purchase or similar plan or an SEC Rule 145
transaction); and (b) termination of this Agreement in accordance with Section 9.8 below.
9. Miscellaneous.
9.1 Additional Parties. Except as otherwise approved by the Board, in the event that
after the date of this Agreement, the Company enters into an agreement with any Person to issue
shares of capital stock to such Person, then, the Company shall cause such Person, as a condition
precedent to entering into such agreement, to become a party to this Agreement by executing a
Joinder Agreement in the form attached hereto as Exhibit B, agreeing to be bound by and subject to
the terms of this Agreement as a Shareholder and thereafter such Person shall be deemed a
Shareholder for all purposes under this Agreement.
9.2 Transfers. Each transferee or assignee of any Shares subject to this Agreement
shall continue to be subject to the terms hereof, and, as a condition precedent to the Company’s
recognizing such transfer, each transferee or assignee shall agree in writing to be subject to each
of the terms of this Agreement by executing and delivering a Joinder Agreement substantially in the
form attached hereto as Exhibit B. Upon the execution and delivery of a Joinder Agreement by any
transferee, such transferee shall be deemed to be a party hereto as if such transferee were the
transferor and such transferee’s signature appeared on the signature pages of this Agreement and
shall be deemed to be a Shareholder. In addition to all other restrictions on the transfer of
Shares set forth in this Agreement, the Company shall not permit the transfer of Shares subject to
this Agreement on its books or issue a new certificate representing any such Shares unless and
until such transferee shall have complied with the terms of this Section 9.2. Each certificate
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representing the Shares subject to this Agreement if issued on or after the date of this
Agreement shall be endorsed by the Company with the legend set forth in Section 9.12.
9.3 Successors and Assigns. 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. 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.
9.4 Governing Law. This Agreement and any controversy arising out of or relating to
this Agreement shall be governed by and construed in accordance with the laws of the State of
Wisconsin without regard to conflict of law principles that would result in the application of any
law other than the law of the State of Wisconsin and without regard to any rules of construction
concerning the draftsman hereof.
9.5 Counterparts; Facsimile. This Agreement may be executed and delivered by
facsimile signature and 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.
9.6 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.
9.7 Notices. All notices and other communications given or made pursuant to this
Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual
receipt or: (i) personal delivery to the party to be notified; (ii) when sent, if sent by
electronic mail or facsimile during the recipient’s normal business hours, and if not sent during
normal business hours, then on the recipient’s next business day; (iii) five (5) days after having
been sent by registered or certified mail, return receipt requested, postage prepaid; or (iv) one
(1) business day after the business day of deposit with a nationally recognized overnight courier,
freight prepaid, specifying next-day delivery, with written verification of receipt. All
communications shall be sent to the respective parties at their addresses as set forth on Schedule
A or Schedule B hereto, or to the principal office of the Company and to the attention of the Chief
Executive Officer, in the case of the Company, or to such email address, facsimile number, or
address as subsequently modified by written notice given in accordance with this Section 9.7.
9.8 Consent Required to Amend, Terminate or Waive. This Agreement may be amended or
terminated and the observance of any term hereof may be waived (either generally or in a particular
instance and either retroactively or prospectively) only by a written instrument executed by (a)
TomoTherapy, (b) the Company; (c) holders of a majority of the outstanding shares of Series A
Common Stock (other than TomoTherapy); and (d) holders of a majority of the outstanding shares of
Series B Common Stock. Notwithstanding the foregoing:
(a) Schedules A and B hereto may be amended by the Company from time to time to add
information regarding additional Shareholders without the consent of the other parties
hereto; and
(b) any provision hereof may be waived by the waiving party on such party’s own behalf,
without the consent of any other party.
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The Company shall give prompt written notice of any amendment, termination or waiver hereunder
to any party directly affected thereby that did not consent in writing thereto. Any amendment,
termination or waiver effected in accordance with this Section 9.8 shall be binding on each party
and all of such party’s successors and permitted assigns, whether or not any such party, successor
or assign entered into or approved such amendment, termination or waiver.
9.9 Delays or Omissions. No delay or omission to exercise any right, power or remedy
accruing to any party under this Agreement, upon any breach or default of any other party under
this Agreement, shall impair any such right, power or remedy of such non-breaching or
non-defaulting party nor shall it be construed to be a waiver of any such breach or default, or an
acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any
waiver of any single breach or default be deemed a waiver of any other breach or default previously
or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the
part of any party of any breach or default under this Agreement, or any waiver on the part of any
party of any provisions or conditions of this Agreement, must be in writing and shall be effective
only to the extent specifically set forth in such writing. All remedies, either under this
Agreement or by law or otherwise afforded to any party, shall be cumulative and not alternative.
9.10 Severability. The invalidity or unenforceability of any provision hereof shall
in no way affect the validity or enforceability of any other provision.
9.11 Entire Agreement. This Agreement (including the Schedules and Exhibits hereto)
and the other Transaction Agreements constitute the full and entire understanding and agreement
among the parties with respect to the subject matter hereof, and any other written or oral
agreement relating to the subject matter hereof existing between the parties is expressly canceled.
9.12 Legend on Share Certificates. Each certificate representing any Shares issued
after the date hereof shall be endorsed by the Company with a legend reading substantially as
follows:
“THE SHARES EVIDENCED HEREBY ARE SUBJECT TO A SHAREHOLDER AGREEMENT, AS MAY BE
AMENDED FROM TIME TO TIME, (A COPY OF WHICH MAY BE OBTAINED UPON WRITTEN REQUEST
FROM THE COMPANY), AND BY ACCEPTING ANY INTEREST IN SUCH SHARES THE PERSON ACCEPTING
SUCH INTEREST SHALL BE DEEMED TO AGREE TO AND SHALL BECOME BOUND BY ALL THE
PROVISIONS OF THAT SHAREHOLDER AGREEMENT, INCLUDING CERTAIN RESTRICTIONS ON TRANSFER
AND OWNERSHIP SET FORTH THEREIN.”
The Company, by its execution of this Agreement, agrees that it will cause the certificates
evidencing the Shares issued after the date hereof to bear the legend required by this
Section 9.12, and it shall supply, free of charge, a copy of this Agreement to any holder of a
certificate evidencing Shares upon written request from such holder to the Company at its principal
office. The parties to this Agreement do hereby agree that the failure to cause the
certificates evidencing the Shares to bear the legend required by this Section 9.12 herein and/or
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the failure of the Company to supply, free of charge, a copy of this Agreement as provided
hereunder shall not affect the validity or enforcement of this Agreement.
9.13 Stock Splits, Stock Dividends, Etc. In the event of any issuance of Shares
hereafter to any of the Shareholders (including, without limitation, in connection with any stock
split, stock dividend, recapitalization, reorganization, or the like), such Shares shall become
subject to this Agreement and shall be endorsed with the legend set forth in Section 9.12.
9.14 Manner of Voting. The voting of Shares pursuant to this Agreement may be
effected in person, by proxy, by written consent or in any other manner permitted by applicable
law.
9.15 Further Assurances. At any time or from time to time after the date hereof, the
parties agree to cooperate with each other, and at the request of any other party, to execute and
deliver any further instruments or documents and to take all such further action as the other party
may reasonably request in order to evidence or effectuate the consummation of the transactions
contemplated hereby and to otherwise carry out the intent of the parties hereunder.
9.16 Dispute Resolution. The parties (a) hereby irrevocably and unconditionally
submit to the jurisdiction of the federal and state courts located within the geographic boundaries
of Dane County in the State of Wisconsin for the purpose of any suit, action or other proceeding
arising out of or based upon this Agreement, (b) agree not to commence any suit, action or other
proceeding arising out of or based upon this Agreement except in the federal and state courts
located within the geographic boundaries of Dane County in the State of Wisconsin, and (c) hereby
waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit,
action or proceeding, any claim that it is not subject personally to the jurisdiction of the
above-named courts, that its property is exempt or immune from attachment or execution, that the
suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action
or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced
in or by such court.
9.17 Costs of Enforcement. If any party to this Agreement seeks to enforce its rights
under this Agreement by legal proceedings, the non-prevailing party shall pay all costs and
expenses incurred by the prevailing party, including, without limitation, all reasonable attorneys’
fees.
9.18 Aggregation of Stock. All Shares held or acquired by a Shareholder and/or its
Affiliates shall be aggregated together for the purpose of determining the availability of any
rights under this Agreement, and such Affiliated persons may apportion such rights as among
themselves in any manner they deem appropriate.
9.19 Spousal Consent. If any individual Shareholder is married on the date of this
Agreement, such Shareholder’s spouse shall execute and deliver to the Company a consent of spouse
in the form of Exhibit C hereto (“Consent of Spouse”), effective on the date hereof.
Notwithstanding the execution and delivery thereof, such consent shall not be deemed to confer or
convey to the spouse any rights in such Shareholder’s Shares that do not otherwise exist by
operation of law or the agreement of the parties. If any individual Shareholder should marry
or
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remarry subsequent to the date of this Agreement, such Shareholder shall within thirty (30) days
thereafter obtain his or her new spouse’s acknowledgement of and consent to the existence and
binding effect of all restrictions contained in this Agreement by causing such spouse to execute
and deliver a Consent of Spouse acknowledging the restrictions and obligations contained in this
Agreement and agreeing and consenting to the same.
[Signature Page Follows]
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IN WITNESS WHEREOF, the parties have executed this Shareholder Agreement as of the date first
written above.
| COMPANY: | ||||
| COMPACT PARTICLE ACCELERATION CORPORATION | ||||
| By: | /s/ Xxxxx Xxxx | |||
| Name: | Xxxxx Xxxx | |||
| Title: | General Manager | |||
[Signature Page to Shareholder Agreement]
| SHAREHOLDERS: | ||||
| TomoTherapy Incorporated | ||||
| By: | /s/ Xxxxxxxxx X. Xxxxxxxxx | |||
| Name: | Xxxxxxxxx X. Xxxxxxxxx | |||
| Its: | CEO | |||
| DaneVest Tech Fund I, LP | ||||
| By: | /s/ Xxxxxx Xxxxxxxxxxx | |||
| Name: | Xxxxxx Xxxxxxxxxxx | |||
| Its: | Manager | |||
| The Endeavors Group, LLC | ||||
| By: | /s/ Xxxxxxx X. Xxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxx | |||
| Its: | Managing Member | |||
| Xxxxx One LLC | ||||
| By: | /s/ Xxxx Xxxx Xxxx-y-Xxxxxx | |||
| Name: | Xxxx Xxxx Xxxx-y-Xxxxxx | |||
| Its: | Manager | |||
| TomoPro Investment, LLC | ||||
| By: | /s/ Xxxx Xxxxxxx | |||
| Name: | Xxxx Xxxxxxx | |||
| Its: | Manager | |||
[Signature Page to Shareholder Agreement]
EXHIBIT A
DEFINITIONS
“Affiliate” means, with regard to any Person, another Person who, directly or indirectly,
controls, is controlled by or is under common control with such Person, including, without
limitation, any general partner, managing member, officer or director of such Person or any venture
capital fund now or hereafter existing that is controlled by one or more general partners or
managing members of, or shares the same management company with, such Person.
“Convertible Securities” means any evidences of indebtedness, shares or other securities
directly or indirectly convertible into or exchangeable for Common Stock, but excluding Options.
“Derivative Securities” means any securities or rights convertible into, or exercisable or
exchangeable for (in each case, directly or indirectly), Common Stock, including options and
warrants.
“Exchange Act” means the Exchange Act of 1934, as amended.
“Exempted Securities” means all of the following:
(a) shares of Common Stock, Options or Convertible Securities issued as a dividend or
distribution on Common Stock;
(b) shares of Common Stock, Options or Convertible Securities issued by reason of a
dividend, stock split, split-up or other distribution on shares of Common Stock, including
any reorganization, recapitalization, reclassification, consolidation or merger involving
the Company in which the Common Stock is converted into or exchanged for securities, cash or
other property;
(c) shares of Common Stock or Options issued to employees or directors of, or
consultants or advisors to, the Company or any of its subsidiaries pursuant to a plan,
agreement or arrangement approved by the Board;
(d) shares of Common Stock or Convertible Securities actually issued upon the exercise
of Options or shares of Common Stock actually issued upon the conversion or exchange of
Convertible Securities, in each case provided such issuance is pursuant to the terms of such
Option or Convertible Security;
(e) shares of Common Stock, Options or Convertible Securities issued to banks,
equipment lessors or other financial institutions, or to real property lessors, pursuant to
a debt financing, equipment leasing or real property leasing transaction approved by the
Board;
(f) shares of Common Stock, Options or Convertible Securities issued to suppliers or
third-party service providers in connection with the provision of goods or services pursuant
to transactions approved by the Board;
C-1
(g) shares of Common Stock, Options or Convertible Securities issued pursuant to the
acquisition of another corporation by the Company by merger, purchase of substantially all
of the assets or other reorganization or joint venture agreement, provided, that such
issuances of substantially all of the assets or other reorganization or to a joint venture
agreement, provided, that such issuances are approved by the Board; and
(h) shares of Common Stock, Options or Convertible Securities issued in connection with
sponsored research, collaboration, technology license, development, OEM, marketing or other
similar agreements or strategic partnerships approved by the Board.
“Exercise Notice” means, with respect to TomoTherapy, the Company or any Shareholder, a
written notice from such party notifying the selling Shareholder that such party intends to
exercise its Right of First Refusal (in the case of TomoTherapy), Secondary Refusal Right (in the
case of the Company) or Tertiary Refusal Right (in the case of a Shareholder other than
TomoTherapy) as to some or all of the Shares with respect to any Proposed Transfer.
“Form S-1” means such form under the Securities Act as in effect on the date hereof or any
successor registration form under the Securities Act subsequently adopted by the SEC.
“Form S-2” means such form under the Securities Act as in effect on the date hereof or any
successor registration form under the Securities Act subsequently adopted by the SEC.
“Form S-3” means such form under the Securities Act as in effect on the date hereof or any
registration form under the Securities Act subsequently adopted by the SEC that permits
incorporation of substantial information by reference to other documents filed by the Company with
the SEC.
“GAAP” means generally accepted accounting principles in the United States.
“IPO” means the Company’s first underwritten public offering of its Common Stock under the
Securities Act.
“Major Investor” means any Shareholder that (i) holds, or has the right to acquire pursuant to
Exhibit A of the Purchase Agreement, shares of Series A Common Stock or Series B Common Stock that
have a collective purchase price of at least Three Million Dollars ($3,000,000), (ii) is not in
breach of this Agreement, the Investor Rights Agreement or the Purchase Agreement, and (iii) both
the Board and TomoTherapy have determined is not a competitor or an Affiliate of a competitor of
either the Company or TomoTherapy.
“New Securities” means, collectively, equity securities of the Company, whether or not
currently authorized, as well as rights, options, or warrants to purchase such equity securities,
or securities of any type whatsoever that are, or may become, convertible or exchangeable into or
exercisable for such equity securities.
“Option” means rights, options or warrants to subscribe for, purchase or otherwise acquire
Common Stock or Convertible Securities.
C-2
“Person” means an individual, firm, corporation, partnership, association, limited liability
company, trust or any other entity.
“Proposed Transfer” means any assignment, sale, offer to sell, pledge, mortgage,
hypothecation, encumbrance, disposition of or any other like transfer or encumbering of any Shares
(or any interest therein) that is proposed by any Shareholder, whether voluntary, involuntary or by
operation of law, other than (a) a transfer of Shares between Shareholders where the transferee is
not, at the time of such transfer and in the determination of both the Board and TomoTherapy, a
competitor of the Company or TomoTherapy, or an Affiliate thereof; and (b) a transfer of Shares
that is approved by the Board.
“Proposed Transfer Notice” means written notice from a Shareholder setting forth the terms and
conditions of a Proposed Transfer.
“Prospective Transferee” means any person to whom a Shareholder proposes to make a Proposed
Transfer.
“Non-exercise Notice” means a written notice from TomoTherapy or the Company notifying the
recipient that the sender does not intend to exercise its Right of First Refusal (in the case of
TomoTherapy) or Secondary Refusal Right (in the case of the Company) as to all Shares subject to a
Proposed Transfer.
“Right of First Refusal” means the right, but not an obligation, of TomoTherapy, or its
permitted transferees or assigns, to purchase some or all of the Shares subject to a Proposed
Transfer, on the terms and conditions specified in the Proposed Transfer Notice.
“Secondary Refusal Right” means the right, but not an obligation, of the Company to purchase
some or all of the Shares subject to a Proposed Transfer that are not purchased pursuant to the
Right of First Refusal, on the terms and conditions specified in the Proposed Transfer Notice.
“Securities Act” means the Securities Act of 1933, as amended.
“Shares” shall mean and include any shares of the Common Stock, including without limitation,
all shares of Common Stock, by whatever name called, now owned or subsequently acquired by a
Shareholder, however acquired, whether through stock splits, stock dividends, reclassifications,
recapitalizations, similar events or otherwise.
“Tertiary Refusal Right” means the right, but not an obligation, of each Shareholder to
purchase up to its pro rata portion (based upon the total number of shares of Shares then held by
all Shareholders) of any Shares subject to a Proposed Transfer that are not purchased pursuant to
the Right of First Refusal and/or the Secondary Refusal Right, on the terms and conditions
specified in the Proposed Transfer Notice.
“Transaction Agreements” means this Agreement, the Investors’ Rights Agreement, dated as of
even date herewith, by and among the Company and each of the Series B Holders named therein, and
the Purchase Agreement.
C-3
Remaining
schedules and exhibits are intentionally omitted.
