0
XXXXXXX 00.0
Xxxxxxxx 0, 0000
Xxxxxxxx Equity Limited Partnership
000 Xxxx Xxxx Xxxx, X-000
Xxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxxxx Xxxxxx
Sigma Partners
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxx Xxxxxx
Dear Sirs:
Internet Security Systems, Inc., a Georgia Corporation (the "Company"),
may at a future date elect to sell its Common Stock in a bona fide, firm
commitment underwriting pursuant to a registration statement filed under the
Securities Act of 1933 (an "IPO"). In the event that the Company consummates an
IPO, it may contract with an underwriter for certain persons designated by the
Company to be entitled to purchase from such underwriter shares of the Company's
Common Stock at the "IPO Price." The IPO Price means the public offering price
of the Company's Common Stock in its IPO. The shares so offered are designated
"Directed Shares." In the event that the Company, upon consummation of an IPO,
offers any Directed Shares to any person, the Company will use its best efforts
to cause the underwriters to allow each of Greylock Equity Limited Partnership
or their affiliates or designates and Sigma Partners or their affiliates or
designates (each a "Holder" and collectively, the "Holders") to purchase at a
price per share equal to the IPO Price, the lesser of (i) 100,000 Shares of the
Company's Common Stock to be sold in the IPO or, (ii) a number of Shares of
Common Stock equal to the total number of Directed Shares offered by the Company
multiplied by the Holder's percentage ownership of the Company's Common Stock on
an as converted basis before any shares are issued in the IPO. The proportion of
such Holder's ownership of Common Stock shall be deemed to include all
securities convertible into or exercisable for Common Stock, including Preferred
Stock, calculated as if such securities had converted into Common Stock at the
then applicable conversion ratio. The Holders acknowledge and agree that,
subject to the foregoing, the Company, acting
2
Greylock Equity Limited Partnership
Sigma Partners
February 2, 1996
Page 2
through its Board of Directors shall have the sole and exclusive discretion to
determine those persons who shall receive Directed Shares. Notwithstanding the
foregoing, the Holders' rights hereunder shall be limited to the extent required
by applicable law or rules of the SEC, the National Association of Securities
Dealers, Inc. or any exchange upon which the shares sold in the IPO may be
traded.
Very truly yours,
INTERNET SECURITY SYSTEMS, INC.
By:
----------------------------
Title:
-------------------------
Agreed and accepted:
GREYLOCK EQUITY LIMITED PARTNERSHIP
By: Greylock Equity GP Limited Partnership,
Its General Partner
By:
---------------------------------------
SIGMA PARTNERS
By:
---------------------------------------
Title:
-------------------------------------
-2-
3
February 14, 1997
AT & T Venture Fund II, L.P.
Venture Fund I, L.P.
Chevy Chase Metro Building
0 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxx Xxxxx, Xxxxxxxx 00000
Attn: Xxx Xxxxxxxxx
Xxxxxxx Xxxxxxx Xxxxxxxx & Xxxxx
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attn: Xxx Xxxxxxx
Dear Sirs:
Internet Security Systems, Inc., a Georgia Corporation (the "Company"),
may at a future date elect to sell its Common Stock in a bona fide, firm
commitment underwriting pursuant to a registration statement filed under the
Securities Act of 1933 (an "IPO"). In the event that the Company consummates an
IPO, it may contract with an underwriter for certain persons designated by the
Company to be entitled to purchase from such underwriter shares of the Company's
Common Stock at the "IPO Price." The IPO Price means the public offering price
of the Company's Common Stock in its IPO. The shares so offered are designated
"Directed Shares." In the event that the Company, upon consummation of an IPO,
offers any Directed Shares to any person, the Company will use its best efforts
to cause the underwriters to allow each of AT & T Ventures or their affiliates
or designates and Xxxxxxx Xxxxxxx Xxxxxxxx & Xxxxx or their affiliates or
designates (each a "Holder" and collectively, the "Holders") to purchase at a
price per share equal to the IPO Price, the lesser of (i) 100,000 Shares of the
Company's Common Stock to be sold in the IPO or, (ii) a number of Shares of
Common Stock equal to the total number of Directed Shares offered by the Company
multiplied by the Holder's percentage ownership of the Company's Common Stock on
an as converted basis before any shares are issued in the IPO. The proportion of
such Holder's ownership of Common Stock shall be deemed to include all
securities convertible into or exercisable for Common Stock, including Preferred
Stock, calculated as if such securities had converted into Common Stock at the
then applicable conversion ratio. The Holders acknowledge and agree that,
subject to the foregoing, the Company, acting
-1-
4
AT & T Ventures
Xxxxxxx Xxxxxxx Xxxxxxxx & Xxxxx
February 14, 1997
Page 2
through its Board of Directors shall have the sole and exclusive discretion to
determine those persons who shall receive Directed Shares. Notwithstanding the
foregoing, AT&T Ventures the Holders' rights hereunder shall be limited to the
extent required by applicable law or rules of the SEC, the National Association
of Securities Dealers, Inc. or any exchange upon which the shares sold in the
IPO may be traded.
Very truly yours,
INTERNET SECURITY SYSTEMS, INC.
By:
----------------------------
Title:
-------------------------
Agreed and accepted:
AT & T VENTURE FUND II, L.P.
By:
------------------------------
Name:
Title:
VENTURE FUND I, L.P.
By:
------------------------------
Name:
Title:
XXXXXXX XXXXXXX XXXXXXXX & XXXXX
By:
------------------------------
Name:
Title:
-2-
