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EXHIBIT 4.02
NIKU CORPORATION
FOURTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
THIS FOURTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this
"Agreement") is made as of the 18th day of November 1999 by and between Niku
Corporation, a Delaware corporation (the "Company") and those holders of the
Company's securities whose names are set forth on Exhibit A hereto (collectively
the "Existing Investors") and those holders of the Company's securities whose
names are set forth on Exhibit B hereto (collectively the "New Investors"). The
New Investors and the Existing Investors are referred to collectively herein as
the "Investors."
THE PARTIES HEREBY AGREE AS FOLLOWS:
1. Registration Rights. The Company covenants and agrees as follows:
1.1 Definitions. For purposes of this Section 1 (unless specifically
stated elsewhere):
(a) The term "Securities Act" means the Securities Act of 1933,
as amended.
(b) The term "Holder" means any person owning or having the
right to acquire Registrable Securities or any assignee thereof.
(c) The term "Exchange Act" shall mean the Securities Exchange
Act of 1934, as amended.
(d) The terms "register," "registered" and "registration" refer
to a registration effected by preparing and filing a registration statement or
similar document in compliance with the Securities Act, and the declaration or
ordering of effectiveness of such registration statement or document.
(e) The term "Registrable Securities" means
(i) Common Stock issuable or issued upon conversion of the
Shares;
(ii) Common Stock now owned by each of Xxxxxx and Xxxxxx X.
Xxxxxxx, Trustees of the Dibachi Family Trust UDT dated 2/11/98 and the Xxxxxxx
1996 Children's Trust UTA dtd 3-11-96, Xxxxxx X. Xxxxxx, Trustee;
(iii) Common Stock issued or issuable upon conversion of
Preferred Stock of the Company issued or issuable upon exercise of warrants to
purchase Preferred Stock of the Company issued after the date hereof to
financial institutions or lessors in connection with commercial credit
arrangements, equipment financings or similar transactions, the terms of which
are approved by the Board of Directors of the Company, provided that any
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such additional parties to this Agreement execute a counterpart signature page
hereto and agree to be bound by the terms hereof, and
(iv) 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 the foregoing, excluding in all cases, however, any shares
sold or transferred by a person in a transaction in which the rights under this
Section 1 are not assigned.
(f) 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.
(g) The term "Shares" shall mean shares of the Company's Series
F Preferred Stock, Series A Preferred Stock, Series B Preferred Stock, Series C
Preferred Stock and Series D Preferred Stock.
(h) The term "SEC" shall mean the Securities and Exchange
Commission.
1.2 Demand Registration.
(a) Registration Rights. If the Company shall receive at any
time after six (6) 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 holders of at least 50% of the
Registrable Securities then outstanding ("Initiating Holders"), requesting that
the Company file a registration statement under the Securities Act covering the
registration of at least twenty percent (20%) of the Registrable Securities then
outstanding, then the Company shall:
(i) within ten (10) days of the receipt thereof, give
written notice of such request to all Holders; and
(ii) effect as soon as practicable, and in any event within
ninety (90) days of the receipt of such request, the registration under the
Securities Act of all Registrable Securities which the Holders request to be
registered, subject to the limitations of subsection 1.2(b), within fifteen (15)
days of the mailing of such notice by the Company in accordance with Section
4.6.
(b) Underwriting. If the 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
subsection 1.2(a) and the Company shall include such information in the written
notice referred to in subsection 1.2(a). The underwriter
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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 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 Registrable
Securities through such underwriting shall, together with the Company, enter
into an underwriting agreement in customary form with the managing underwriter
selected for such underwriting by the Company. Notwithstanding any other
provision of this Section 1.2, if the Company and the underwriter advise 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, and the number of Registrable Securities
that may be included in the underwriting on behalf of each selling Holder shall
be allocated pro-rata amongst all selling Holders according to the total number
of Registrable Securities held by each such selling Holder. For purposes of the
foregoing allocation and any other similar allocations required by this Section
1, for any selling Holder which is a partnership or corporation, the partners,
retired partners and stockholders of such Holder (and in the case of a
partnership, any affiliated partnerships), 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 Holder," and any
pro-rata reduction with respect to such "selling Holder" shall be based upon the
aggregate number of Registrable Securities owned by all entities and individuals
included in such "selling Holder," as defined in this sentence. To facilitate
the allocation of shares in accordance with the above provisions, the Company
may round the number of shares allocated to any Holder to the nearest 100
shares.
(c) Deferral of Registration. Notwithstanding the foregoing, if
the Company shall furnish to the Holders requesting a registration statement
pursuant to this Section 1.2 a certificate signed by the Chief Executive Officer
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 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 one
hundred twenty (120) days after receipt of the request of the Initiating
Holders; provided, however that the Company may not utilize this right more than
twice in any twelve-month period and the Company shall not utilize this right
(or the similar right to defer in Section 1.4(b)) for two consecutive one
hundred twenty (120) day periods.
(d) Number of Registrations. The Company shall not be obligated
to effect, or to take any action to effect, any registration pursuant to this
Section 1.2 after the Company has effected two (2) registrations pursuant to
this Section 1.2 and such registrations have been declared or ordered effective.
For the purposes of this Section 1.2, a proposed registration that is withdrawn
due to a material adverse change in the Company's business or financial
condition shall not count as a registration.
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1.3 Piggyback Registration Rights.
(a) Registration Rights. If the Company proposes to register any
of its stock or other securities under the Securities Act in connection with the
public offering of such securities solely for cash (other than a registration
relating solely to the sale of securities to participants in a Company stock
plan, a registration effected pursuant to Rule 145 under the Securities Act 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 fifteen (15) days after mailing of
such notice by the Company in accordance with Section 4.6, the Company shall,
subject to the provisions of paragraph (b) below, cause to be registered under
the Securities Act all of the Registrable Securities that each such Holder has
requested to be registered.
(b) Underwriting. If the registration of which the Company gives
notice is for a registered public offering involving an underwriting, the
Company shall so advise the Holders as part of the written notice given pursuant
to Section 1.3(a). In such event, the right of any Holder to registration
pursuant to this Section 1.3 shall be conditioned upon such Holder's
participation in such underwriting and the inclusion of Registrable Securities
in the underwriting to the extent provided herein. All Holders proposing to
distribute Registrable Securities through such underwriting shall (together with
the Company and the other holders distributing their securities through such
underwriting) enter into an underwriting agreement in customary form with the
managing underwriter selected for such underwriting by the Company.
Notwithstanding any other provision of this Section 1.3, if the Company and the
managing underwriter determine that marketing factors require a limitation of
the number of shares to be underwritten, the managing underwriter may limit or
exclude entirely the Registrable Securities to be included in such registration.
The Company shall so advise all Holders distributing Registrable Securities
through such underwriting, and the number of Registrable Securities that may be
included in the underwriting on behalf of each selling Holder and each other
person distributing securities in such underwriting shall be allocated pro-rata
amongst all selling Holders and all such other persons according to the
respective amounts of Registrable Securities or other securities entitled to
registration rights held by such selling Holders and other persons at the time
of filing the registration statement. To facilitate the allocation of shares in
accordance with the above provisions, the Company may round the number of shares
allocated to any Holder or other person to the nearest 100 shares.
1.4 Form S-3 Registration. If at any time, and from time to time,
that the Company shall be eligible to effect a registration and offering
pursuant to Form S-3 under the Securities Act or any successor form ("Form
S-3"), the Company shall receive from one or more of the Holders 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:
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(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 1.4: (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 a gross aggregate price to the public of less than
two million dollars ($2,000,000); (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 Company, it would be
seriously detrimental to the Company 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
one hundred twenty (120) days after receipt of the request of the Holder or
Holders under this Section 1.4; provided, however, that the Company shall not
utilize this right more than twice in any twelve month period, and the Company
shall not utilize this right (or the similar right to defer in Section 1.2(c))
for two consecutive one hundred twenty (120) day periods; (4) if the Company
has, within the twelve (12) month period preceding the date of such request,
previously effected a registration on Form S-3 pursuant to this Section 1.4; 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. Registrations effected pursuant to this
Section 1.4 shall not be counted as demands for registration or registrations
effected pursuant to Sections 1.2 or 1.3, respectively.
1.5 Furnish Information. 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.
1.6 Expenses of 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 this
Section I for each Holder (which right may be assigned as provided in Section
1.10), including (without limitation) all registration, filing, and
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qualification fees, printers and accounting fees relating or apportionable
thereto and the fees and disbursements of counsel for the Company and no more
than one counsel for all the selling Holders, but excluding underwriting
discounts and commissions relating to Registrable Securities; provided, however,
that the Company shall not be required to pay for any expenses of any
registration proceeding begun pursuant to Section 1.2 or 1.4 if the registration
request is subsequently withdrawn at the request of a majority of the Holders of
the Registrable Securities electing to be registered (in which case all
participating Holders shall bear such expenses), unless (i) the registration is
withdrawn following any deferral of the registration by the Company pursuant to
Section 1.2(c) or 1.4(b); (ii) the registration is withdrawn due to a material
adverse change in the Company's business or financial condition; or (iii) in the
case of a demand registration pursuant to Section 1.2, the Holders of a majority
of the Registrable Securities proposed to be registered by such Holders
requesting withdrawal agree that the Holders shall forfeit their right to one
registration pursuant to Section 1.2.
1.7 No 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.
1.8 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 Securities
Act) for such Holder and each person, if any, who controls such Holder or
underwriter within the meaning of the Securities Act or the Exchange Act,
against any losses, claims, damages, or liabilities (joint or several) to which
they may become subject under the Securities Act, the Exchange 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 Securities Act,
the Exchange Act, any state securities law or any rule or regulation promulgated
under the Securities Act, the Exchange Act or any state securities law; and the
Company will pay to each such Holder, underwriter or controlling person any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability, or action,
as such expenses are incurred; provided, however, that the indemnity agreement
contained in this subsection 1.8(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 to any Holder,
any underwriter (as defined in the Securities Act) for such Holder or any person
who controls such Holder or underwriter within the meaning of the Securities Act
or Exchange Act, for any such loss, claim, damage, liability, or action to the
extent
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that it arises out of or is based upon a Violation which occurs in reliance upon
and in conformity with written information furnished by such Holder, underwriter
or controlling person.
(b) To the extent permitted by law, each 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 Securities Act, any underwriter, any other
Holder selling securities in such registration statement and any controlling
person of any such underwriter or other Holder, severally but not jointly,
against any losses, claims, damages, or liabilities (joint or several) to which
any of the foregoing persons may become subject, under the Securities Act, the
Exchange 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 specified for use in such registration
statement; and each such Holder will pay any legal or other expenses reasonably
incurred by any person intended to be indemnified pursuant to this subsection
1.8(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 1.8(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 by
any Holder under this subsection 1.8(b) exceed the net proceeds from the
offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this
Section 1.8 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 1.8, 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 one 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 shall not relieve such indemnifying party of any liability to the
indemnified party under this Section 1.8 unless the failure to deliver notice is
materially prejudicial to its ability to defend such action. Any omission to so
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 1.8.
(d) If the indemnification provided for in this Section 1.8 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
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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; provided that in no event shall any Holder be required to
contribute under this subsection 1.8(d) an aggregate amount in excess of the
gross proceeds from the offering received by such Holder less any amounts paid
by the Holder pursuant to subsection 1.8(b). 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 as to the parties to the underwriters agreement and any
stockholders of the Company selling shares of the Company in such offering.
(f) The obligations of the Company and Holders under this
Section 1.8 shall survive the completion of any offering of Registrable
Securities in a registration statement under this Section 1, and otherwise.
1.9 Reports under the Exchange Act. 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:
(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) file with the SEC in a timely manner all reports and other
documents required of the Company under the Securities Act and the Exchange Act;
and
(c) 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 Securities Act and the
Exchange Act (at any time after it has become subject to such reporting
requirements), (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.
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1.10 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 five hundred thousand (500,000) shares of Registrable Securities (subject
to appropriate adjustment for stock splits, dividends, combinations and other
recapitalizations), provided: (a) the Company is, within a reasonable time
before 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; (b) such transferee or assignee agrees
in writing to be bound by and subject to the terms and conditions of this
Agreement, including without limitation the provisions of Section 1.11 and (c)
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 Securities Act. For the purposes of determining the number
of shares of Registrable Securities held by a transferee or assignee of a holder
of Registrable Securities, (i) the holdings of affiliated partnerships and other
entities, constituent or retired partners or members (collectively, "Affiliated
Members") and (ii) the holdings of spouses and ancestors, lineal descendants and
siblings who acquire Registrable Securities by gift, will or intestate
succession (collectively, "Family Members") shall in each case be aggregated
together; provided that all assignees and transferees who would not qualify
individually for assignment of registration rights shall designate in writing to
the Company on behalf of the entire group of Affiliated Persons or Family
Members, as the case may be, a single attorney-in-fact for the purpose of
exercising any rights, receiving notices or taking any action under this Section
1.
1.11 "Market Stand-Off" Agreement. Each Holder 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 Securities Act, it 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 as of the effective date except Registrable Securities
included in such registration; provided, however, that:
(a) all officers and directors of the Company enter into
substantially similar agreements; and
(b) such market stand-off time period shall not exceed one
hundred eighty (180) days except as may be agreed to by holders of a majority of
the then outstanding Registrable Securities.
Each Investor agrees to provide to the underwriters of any public
offering such further agreement as such underwriter may require in connection
with this market stand-off agreement. 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.
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1.12 Termination of Registration Rights. No Holder shall be entitled
to exercise any right provided for in this Section 1 after the earlier of (a)
five (5) years following the consummation of an underwritten public offering by
the Company of shares of its Common Stock pursuant to a registration statement
on form S-1 or SB-2 under the Securities Act yielding gross proceeds to the
Company in excess of twenty million dollars $20,000,000 (a "Qualified IPO"), and
(b) such time as Rule 144 or another similar exemption under the Securities Act
is available for the sale of all of such Holder's shares during a three
(3)-month period without registration.
2. Right of First Refusal.
2.1 General. Each Holder (as defined in Section 1.1(b)) and any
party to whom such Holder's rights under this Section 2 have been duly assigned
in accordance with Section 2.6 (each such Holder or assignee being hereinafter
referred to as a "Rights Holder") has the right of first refusal to purchase
such Rights Holder's Pro Rata Share (as defined below), of all (or any part) of
any "New Securities" (as defined in Section 2.2) that the Company may from time
to time issue after the date of this Agreement. A Rights Holder's "Pro Rata
Share" for purposes of this right of first refusal is the ratio of (a) the
number of Registrable Securities as to which such Rights Holder is the Holder
(and/or is deemed to be the Holder under Section 1.1(b)), to (b) a number of
shares of Common Stock of the Company equal to the sum of (1) the total number
of shares of Common Stock of the Company then outstanding plus (2) the total
number of shares of Common Stock of the Company into which all then outstanding
shares of Preferred Stock of the Company are then convertible plus (3) the
number of shares of Common Stock of the Company reserved for issuance under
stock purchase and stock option plans of the Company and outstanding warrants.
2.2 New Securities. "New Securities" shall mean any Common Stock or
Preferred Stock of the Company, whether now authorized or not, and rights,
options or warrants to purchase such Common Stock or Preferred Stock, and
securities of any type whatsoever that are, or may become, convertible or
exchangeable into such Common Stock or Preferred Stock; provided, however, that
the term "New Securities" does not include:
(a) shares of Common Stock issued or issuable upon conversion of
the outstanding shares of the Preferred Stock;
(b) up to an aggregate of 10,568,210 shares (such number to be
calculated net of any repurchases of such shares by the Company and net of any
expired or terminated options, warrants or rights and to be proportionately
adjusted to reflect any subsequent split, subdivision, combination or reverse
stock split of the outstanding shares of Common Stock of the Company) issued as
(i) shares of Common Stock (or options, warrants or rights
therefor) granted or issued hereafter to employees, officers, directors,
contractors, consultants or advisers to, the Company or any Subsidiary
pursuant to incentive agreements, stock purchase or stock option plans,
stock bonuses or awards,
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warrants, contracts or other arrangements that are approved by the Board
of Directors;
(ii) shares of the Company's Common Stock or Preferred Stock
(and/or options or warrants therefor) issued or issuable to parties
providing the Company with equipment leases, real property leases,
loans, credit lines, guaranties of indebtedness, cash price reductions
or similar financing, under arrangements approved by the Board of
Directors;
(c) shares of Common Stock or Preferred Stock issued pursuant to
the acquisition of another corporation or entity by the Company by
consolidation, merger, purchase of all or substantially all of the assets, or
other reorganization in which the Company acquires, in a single transaction or
series of related transactions, all or substantially all of the assets of such
other corporation or entity or fifty percent (50%) or more of the voting power
of such other corporation or entity or fifty percent (50%) or more of the equity
ownership of such other entity;
(d) any shares of Series C Preferred Stock issued under the
Series C Preferred Stock Purchase Agreement of even date herewith;
(e) any securities issuable upon exercise of any options,
warrants or rights to purchase any securities of the Company outstanding on the
date of this Agreement ("Warrant Securities") and any securities issuable upon
the conversion of any Warrant Securities or upon the exercise or conversion of
any securities, if such securities were first offered to the Rights Holders
hereunder;
(f) shares of the Company's Common Stock or Preferred Stock
issued in connection with any stock split or stock dividend; and
(g) securities offered by the Company to the public pursuant to
a registration statement filed under the Securities Act.
2.3 Procedures. In the event that the Company proposes to undertake
an issuance of New Securities, it shall give to each Rights Holder written
notice of its intention to issue New Securities (the "Notice"), describing the
type of New Securities and the price and the general terms upon which the
Company proposes to issue such New Securities. Each Rights Holder shall have ten
(10) business days from the date of mailing of any such Notice to agree in
writing to purchase such Rights Holder's Pro Rata Share of such New Securities
for the price and upon the general terms specified in the Notice by giving
written notice to the Company and stating therein the quantity of New Securities
to be purchased (not to exceed such Rights Holder's Pro Rata Share). If any
Rights Holder fails to so agree in writing within such ten (10) business day
period to purchase such
Rights Holder's full Pro Rata Share of an offering of New Securities (a
"Nonpurchasing Holder"), then such Nonpurchasing Holder shall forfeit the right
hereunder to purchase that part of his Pro Rata Share of such New Securities
that he did not so agree to purchase and the Company shall promptly give each
Rights Holder who has timely agreed to purchase his full Pro Rata Share of such
offering of New Securities (a "Purchasing Holder") written notice of the failure
of any Nonpurchasing Holder to purchase such
11
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Nonpurchasing Rights Holder's full Pro Rata Share of such offering of New
Securities (the "Overallotment Notice"). Each Purchasing Holder shall have a
right of overallotment such that such Purchasing Holder may agree to purchase a
portion of the Nonpurchasing Holders' unpurchased Pro Rata Shares of such
offering on a pro rata basis according to the relative Pro Rata Shares of the
Purchasing Rights Holders, at any time within five (5) business days after
receiving the Overallotment Notice.
2.4 Failure to Exercise. In the event that the Rights Holders fail
to exercise in full the right of first refusal within such ten (10) plus five
(5) business day period, then the Company shall have 120 days thereafter to sell
the New Securities with respect to which the Rights Holders' rights of first
refusal hereunder were not exercised, at a price and upon general terms not
materially more favorable to the purchasers thereof than specified in the
Company's Notice to the Rights Holders. In the event that the Company has not
issued and sold the New Securities within such 120 day period, then the Company
shall not thereafter issue or sell any New Securities without again first
offering such New Securities to the Rights Holders pursuant to this Section 2.
2.5 Termination. This right of first refusal shall terminate (a)
immediately before the closing of the first underwritten sale of Common Stock of
the Company to the public pursuant to a registration statement filed with, and
declared effective by, the SEC under the Securities Act, covering the offer and
sale of Common Stock to the public at an aggregate gross public offering price
(calculated before deduction of underwriters' discounts and commissions) of at
least twenty million dollars ($20,000,000) or (b) upon an acquisition of the
Company by another corporation or entity by consolidation, merger or other
reorganization in which the holders of the Company's outstanding voting stock
immediately prior to such transaction (x) own, immediately after such
transaction, securities representing less than a majority of the voting power of
the corporation or other entity surviving such transaction and (y) receive cash,
securities registered under Section 12 of the Exchange Act, or a combination
thereof in exchange for all shares of Common Stock of the Company owned by such
holders immediately before such transaction.
2.6 Assignment of Right of First Refusal. The right to purchase the
Pro Rata Shares pursuant to this Section 2 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 five hundred thousand
(500,000) shares of Registrable Securities (subject to appropriate adjustment
for stock splits, dividends, combinations and other recapitalizations),
provided: (a) the Company is, within a reasonable time before such transfer,
furnished with written notice of the name and address of such transferee or
assignee and the securities with respect to which such right of first refusal
are being assigned; (b) such transferee or assignee agrees in writing to be
bound by and subject to the terms and conditions of this Agreement, including
without limitation the provisions of Section 1.11 and (c) 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
Securities Act. For the purposes of determining the number of shares of
Registrable Securities held by a transferee or assignee of a holder of
Registrable Securities, (i) the holdings of Affiliated Members and (ii) the
holdings of Family Members shall in each case
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be aggregated together; provided that all assignees and transferees who would
not qualify individually for assignment of the right of first refusal shall
designate in writing to the Company on behalf of the entire group of Affiliated
Persons or Family Members, as the case may be, a single attorney-in-fact for the
purpose of exercising any rights, receiving notices or taking any action under
this Section 2.
3. Covenants of the Company.
3.1 Delivery of Financial Statements. The Company shall deliver to
each Investor, so long as such Investor shall be a Holder of at least five
hundred thousand (500,000) Shares (subject to appropriate adjustment for stock
splits, dividends, combinations and other recapitalizations):
(a) as soon as practicable, but in any event within one hundred
twenty (120) 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
stockholders' equity as of the end of such year, and a statement of cash flows
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 sixty (60)
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, a statement of cash flows
for such fiscal quarter and an unaudited balance sheet as of the end of such
fiscal quarter.
3.2 Inspection. The Company shall permit each Investor, so long as
such Investor shall be a Holder of at least five hundred thousand (500,000)
Shares (subject to appropriate adjustment for stock splits, dividends,
combinations and other recapitalizations), at such Holder'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 Holder;
provided, however, that the Company shall not be obligated pursuant to this
Section 3.2 to provide access to any information which it reasonably considers
to be a trade secret or similar confidential information unless the recipient is
not deemed by the Board of Directors to be a competitor or potential competitor
of the Company and such Holder signs an appropriate nondisclosure agreement.
The Company hereby acknowledges that CNET, Inc. is not and will not be deemed a
competitor or potential competitor for purposes of this Section 3.2.
3.3 Termination of Covenants. The covenants set forth in this
Section 3 shall terminate and be of no further force or effect (a) upon a
Qualified IPO or when the Company first becomes subject to the periodic
reporting requirements of Sections 12(g) or 15(d) of the Exchange Act, whichever
event shall first occur, or (b) with respect to the covenants set forth in
Section 3.2, as to any Holder, or transferee or assignee of such Holder, who is
deemed by the Board of Directors of the Company to be a competitor or potential
competitor of the Company.
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4. Miscellaneous.
4.1 Additional Parties. "Purchaser" under that certain Series D
Preferred Stock Purchase Agreement made as of October __, 1999 by and between
the Company and such Purchasers shall become a "New Investor" hereunder, when
such Purchaser executes a counterpart signature page hereof and without the need
for an amendment hereto except to add such Purchaser's name to Exhibit B hereto.
In the event of the issuance of warrants to purchase Preferred Stock to
financial institutions or lessors in connection with commercial credit
arrangements, equipment financings or similar transactions, the terms of which
are approved by the Board of Directors of the Company, upon execution of a
counterpart signature page by any such entity and without need for an amendment
hereto except to add such entity's name to Exhibit B hereto, any such entity
shall become a party to this Agreement and shall be deemed an "Investor" for
purposes of Sections 1, 2 and 4 of this Agreement as of the date of execution of
such counterpart signature page.
4.2 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 permitted 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.
4.3 Governing Law. This Agreement shall be governed by and construed
under the laws of the State of California as such laws apply to agreements
entered into by residents of California and to be performed entirely within such
state.
4.4 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.
4.5 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.
4.6 Notices. All notices and other communications required or
permitted hereunder shall be in writing, shall be effective when given, and
shall in any event be deemed to be given upon receipt or, if earlier, (a) five
(5) days after deposit with the U.S. Postal Service or other applicable postal
service, if delivered by first class mail, postage prepaid, (b) upon delivery,
if delivered by hand, (c) one (1) business day after the business day of deposit
with Federal Express or similar overnight courier, freight prepaid or (d) one
(1) business day after the business day of facsimile transmission, if delivered
by facsimile transmission with copy by first class mail, postage prepaid, and
shall be addressed (i) if to the Investors, at the Investors' respective
addresses as set forth on Exhibit A or Exhibit B hereto and (ii) if to the
Company, at the address of its principal corporate offices (attention:
Secretary), or in any such case at such other address
14
15
as a party may designate by ten (10) days' advance written notice to the other
party pursuant to the provisions above.
4.7 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.
4.8 Amendments and Waivers. 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 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.
4.9 Aggregation of Stock. All shares of the Series F, Series A,
Series B, Series C and Series D Preferred Stock of the Company held or acquired
(or Common Stock issuable upon conversion thereof) by affiliated entities or
persons shall be aggregated together for the purpose of determining the
availability or discharge of any rights under this Agreement.
4.10 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.
4.11 Entire Agreement; Amendment; Waiver. This Agreement (including
the Exhibits hereto) constitutes the full and entire understanding and agreement
between the parties with regard to the subjects hereof and thereof.
[Signature Page Follows]
15
16
COMPANY: INVESTOR:
NIKU CORPORATION
By: By:
------------------------------- ------------------------------
Xxxxxx Xxxxxxx, President
Name:
----------------------------
Title:
---------------------------
16
17
LIST OF EXHIBITS
Exhibit A - Existing Investors
Exhibit B - New Investors
17
18
Exhibit A
Existing Investors
COMMON STOCK
NAME SHARES
-----------------------------------------------------------
Xxxxxxx 1996 Children's Trust 500,000
UTA dtd 3-11-96, Xxxxxx X.
Xxxxxx, Trustee
Xxxxxxx, Xxxxxx and Xxxxxx X., 3,200,000
Trustees of the Dibachi Family
Trust UDT dated 2-11-98
SERIES F
NAME SHARES
-----------------------------------------------------------
Xxxxxxx 1996 Children's Trust 700,000
UTA dtd 3-11-96, Xxxxxx X.
Xxxxxx, Trustee
Xxxxxxx, Xxxxxxx X. and Xxxxxxx X., 1,300,000
Trustees of the Xxxxxxx Family Trust
U/D/T dated 4-2-97
Xxxxxxxx V, LLC, Xxxxxx Xxxxxx, 1,500,000
Managing Member
Dibachi, Xxxxxxxx Xxxxx 500,000
Trust, Xxxxxx Xxxxxx, Trustee
Xxxxxxx, Xxxxxx and Xxxxxx X., 5,900,000
Trustees of the Dibachi Family
Trust UDT dated 2-11-98
SILICON VALLEY COMMUNITIES VENTURES
NOT A PARTY TO THIS AGREEMENT
(100,000 SHARES)
18
19
SERIES A
NAME SHARES
-----------------------------------------------------------
Xxxx, Xxxx X. and Xxxxxx X. Xxxx 285,714
Family Trust 1994
Delivanis, Constantin and Alison 142,857
Xxxxxxx as co-trustees
of the Xxxxxxxxx-Xxxxxxx Family
Trust dtd 12-13-90
Xxxxx Xxxxxxx 714,285
Xxxxxxx, Xxxxxx and Xxxxxx X., 285,714
Trustees of the Dibachi
Family Trust UDT dated 2-11-98
Xxxx Xxxxxxx 142,857
Xxxxxxxx V, LLC, Xxxxxx Xxxxxx, 5,714
Managing Member
Xxxxxxx, Xxxxxxx X. and Xxxxxxx 1,857,142
A., Trustees of the
Xxxxxxx Family Trust U/D/T dated
4-2-97
GCA Investments 1998 30,000
Xxx Xxxxxxx 142,857
Xxxxx Xxxx 150,000
Xxxxx Family Partners 285,714
Soroush and Xxxxxxxx Xxxxxx 142,857
19
20
Kaboli, JTWROS
Xxxx Xxxxx 71,428
Xxxxxxx Xxxxxxxx 71,428
Xxxxxx Xxxxxxx & Co.
Xxxxxx Xxxxxx 28,571
The Xxxxxxx X. Xxxxxxxx Revocable Trust 285,714
Madhavan Rangaswami 142,857
VLG Investments 1998 71,428
Attn: Xxxxx Xxxxxxx
Xxxxxxx X. Xxxx, Xx. And 285,714
Xxxxx X. Xxxx, Trustees of the Xxxx Family
Trust, dated June 3, 1995
SERIES B
NAME SHARES
-----------------------------------------------------------
Comdisco, Inc. 146,666
Xxx and Xxxxxxxx Xxxx, Trustees of 6,666
the Labe 1998 Revocable Trust, dated 10/5/98
Xxxxxx Xxxxxxxxx 6,666
The Phoenix Partners 333,333
Xxxxxx Xxxxxx 13,333
20
21
VLG Investments 1998 13,333
Xxxxxxxxx Xxxxxxxxxx 60,000
Xxxxx X. Xxxxxxxxxxx 33,333
Xxxxxxx X. Xxxxxxxx 66,666
Xxxxx Xxxxx 66,666
Xxxxxx and Xxxxx Xxxxxx JTWROS 133,333
Xxxxxx Xxxxxx Partners, LLC 160,000
Venrock Associates 2,328,000
Venrock Associates II, L.P. 2,845,333
Xxxxxx and Xxxxxx X. Xxxxxxx, Trustees of 666,666
the Dibachi Family Trust UDT dated 2/11/98
Xxxxxxx X. and Xxxxxxx X. Xxxxxxx, 333,333
Trustees of the Xxxxxxx Family Trust UDT
dated 4/27/97
Xxxxxxx X. and Xxxxxxx X. Xxxxxxx, 160,000
Trustees of the Xxxxxxx Family Trust UDT
dated 4/27/97
Xxxxxxx X. Xxxx, Xx. and Xxxxx X. Xxxx, 133,333
Trustees of the Xxxx Family Trust, dated
6/3/95
Xxxxx Xxxxxx as nominee for the Broadview 293,333
Partners Group
21
22
Xxxxx Family Partners 133,333
Xxxx Xxxxxx 66,666
SERIES C
NAME SHARES
-----------------------------------------------------------
X. X. Xxxxxxx III, L.P. 4,416,199
Whitney Strategic Partners III, L.P. 106,414
Xxxxx X. Xxxxx 25,126
F & W Investments 1998 25,126
Xxx Xxxx 25,126
Xxxxxxx X. Xxxxxxx and Xxxxxxx X. 502,513
Xxxxxxx, Trustees of the Xxxxxxx Family
Trust U/D/T dated 4/2/97
Xxxxxxx X. Xxxxxxx 75,377
Xxxxxxxxx & Xxxxx California 49,121
Xxxxxxxxx & Xxxxx Employee Venture 28,391
Fund, X.X. XX
Access Technology Partners, L.P. 396,985
Access Technology Partners Brokers 4,397
Fund, L.P.
Xxxxxxxx Xxxxxx 12,563
X.X. Xxxxxxx & Sons C/F Xxxxxxx X. 5,025
Xxxxx XXX Account
Xxxxxxx Xxx 2,513
Xxxxxx Xxxxxx 3,518
Phoenix Partners IIIB 251,256
Phoenix Partners IV 251,256
22
23
TCW/ICICI India Private Equity Fund, 705,944
L.L.C.
TCW/ICICI India Private Equity Amp 299,081
Fund, L.L.C.
Xxxxxxx Xxxxxxx 25,126
Venrock Associates 999,246
Venrock Associates II, L.P. 1,437,940
Xxxxxxx and Xxxxx Xxxx, 50,251
Trustees of the Xxxx Family Trust
Dated June, 1995
Xxxxxxxx X. Xxxxxxx III 25,126
Xxxx X. Xxxxx 12,563
Comdisco, Inc. 251,256
23
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Exhibit B
New Investors
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
Amerindo entities (total is $10 million)
Amerindo Technology Growth Fund II 798,500 $5.00 $3,992,500.00
000 Xxxx Xxxxxx, Xxxxx 00
Xxx Xxxx, XX 00000
Attn: Xxxxxxx Xxxxxx
Xxxxx Xxxxxxxxxx 5,000 $5.00 $25,000.00
00 Xxxxx Xxxxxxxxx Xxxxxx,
Xxxxxx, XX X0X 0XX
Xxxxxxx Xxxxxx 10,000 $5.00 $50,000.00
c/o Amerindo Investment Advisors, Inc.
0 Xxxxxxxxxxx Xxxxxx, Xxx 0000
Xxx Xxxxxxxxx, XX 00000
Xxxxxxx Xxxxxx-Xxxxxxx 2,000 $5.00 $10,000.00
c/o Amerindo Investment Advisors, Inc.
000 Xxxx Xxxxxx, Xxxxx 00
Xxx Xxxx, XX 00000
Pivotal Partners L.P. 320,000 $5.00 $1,600,000.00
Attention: Xxxxx Xxx
Xxx Xxxxxxxxxxx Xxxxxx, Xxx 0000
Xxx Xxxxxxxxx, XX 00000
California Bank & Trust Agent for 60,000 $5.00 $300,000.00
Xxxxx Xxxxxxxxxx XXX #1
Attention: Xxxxx Xxx
Xxx Xxxxxxxxxxx Xxxxxx, Xxx 0000
Xxx Xxxxxxxxx, XX 00000
Xxxxxxx Xxxxxxxx 1,000 $5.00 $5,000.00
c/o Amerindo Investment Advisors, Inc.
000 Xxxx Xxxxxx, Xxxxx 00
Xxx Xxxx, XX 00000
Vertex Capital II LLC 80,000 $5.00 $400,000.00
000 Xxxx Xxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxxxxx
25
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
Xxxxxxx Xxxxxxxxxxx 20,000 $5.00 $100,000.00
000 Xxxx Xxxx Xxxxxx
Xxxxxxx, XX 00000
Xxxx Xxxxx 3,000 $5.00 $15,000.00
c/o Amerindo Investment Advisors, Inc.
000 Xxxx Xxxxxx, Xxxxx 00
Xxx Xxxx, XX 00000
Xxxxxx Xxxxxx 500 $5.00 $2,500.00
c/o Amerindo Investment Advisors, Inc.
0 Xxxxxxxxxxx Xxxxxx, Xxx 0000
Xxx Xxxxxxxxx, XX 00000
Xxxxxx XxXxxxxx 400,000 $5.00 $2,000,000.00
c/o Amerindo Investment Advisors, Inc.
0 Xxxxxxxxxxx Xxxxxx, Xxx 0000
Xxx Xxxxxxxxx, XX 00000
Xxxxxx Master Trust 300,000 $5.00 $1,500,000.00
c/o Amerindo Investment Advisors, Inc.
000 Xxxx Xxxxxx, Xxxxx 00
Xxx Xxxx, XX 00000
Attn: Xxx Xxxxxx
Xxxxxxxx Art 20,000 $5.00 $100,000.00
00 Xxxx Xxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxx Xxxxxx as Nominee for the Broadview 57,500 $5.00 $287,500.00
Partners Group
Xxxxx Xxxxx
c/o Broadview International
Xxx Xxxxxx Xxxxx
Xxxx Xxx, XX 00000
Xxxxxxx X. Xxxxx 5,000 $5.00 $25,000.00
c/x Xxxxxx Capital Management, L.L.C.
0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
26
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
Charter Growth Capital, L.P. 480,000 $5.00 $2,400,000.00
c/o Charter Growth Capital
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx, XX 00000
Attn: X. Xxxx Xxxxx
Charter Growth Capital Co-Investment Fund, L.P. 90,000 $5.00 $450,000.00
c/o Charter Growth Capital
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx, XX 00000
Attn: X. Xxxx Xxxxx
CGC Investors, L.P. 30,000 $5.00 $150,000.00
c/o Charter Growth Capital
000 Xxxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxx Xxxx, XX 00000
Attn: X. Xxxx Xxxxx
Xxxxxxxxx Xxxxxxxxxx 10,191 $5.00 $50,955.00
0000 Xxxxxxx Xxxxx
Xxx Xxxx, XX 00000
CNET Investments, Inc. 1,000,000 $5.00 $5,000,000.00
000 Xxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Attn: Xxxxxxx Xxxxxxxx
Comdisco, Inc. 400,000 $5.00 $2,000,000.00
0000 Xxxx Xxxx Xxxx
Xxxxxxxx Xxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxx
Xxxxxxx X. Xxxxx 7,000 $5.00 $35,000.00
c/x Xxxxxx Capital Management, L.L.C.
0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
27
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
Xxxxx X. Xxxxx 4,268 $5.00 $21,340.00
000 Xxxxxxxxx Xxxx
Xxxx Xxxx, XX 00000
CrossFire Ventures, LLC 100,000 $5.00 $500,000.00
0000 Xxxxx Xxxx., Xxxxx X
Xxx Xxxx, XX 00000
Attn: Xxxx Xxxxxxx
Xxxxxxxxxx Xxxxxxxxx & Xxxxxx Xxxxxxx as 30,000 $5.00 $150,000.00
Co-trustees of the Xxxxxxxxx-Xxxxxxx Family
Trust dated 12/30/90
00000 Xxxxxxx Xxxxx
Xxx Xxxxx Xxxxx, XX 00000
Xxxxx Xxxxxxx 70,000 $5.00 $350,000.00
00000 Xxxxxxx Xxxx.
Xxxxxxxx, XX 00000
Essex Private Placement Fund II 400,000 $5.00 $2,000,000.00
Limited Partnership
000 Xxxx Xxxxxx, 00xx Xxxxx
Xxxxxx, XX 00000-0000
Attn: Xxxxx Xxxxxxxxx
F&W Investments 1999 10,000 $5.00 $50,000.00
0 Xxxx Xxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxx, Esq.
F&W Investments 2000 20,000 $5.00 $100,000.00
0 Xxxx Xxxx Xxxxxx
Xxxx Xxxx, XX 00000
Attn: Xxxxx Xxxxxx, Esq.
Xxxxxxxx X. Xxxxxxx and Xxxxxxx X. Xxxxxxx, 500,000 $5.00 $2,500,000.00
Trustees of the Xxxxxxx Family Trust U/D/T
dated 4/2/97
c/o Venrock Associates
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
28
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
Xxxxxxxxx & Xxxxx entities (total is $1
million)
Attn: Xxxxx Xxxx
Xxx Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000 (total is $1 million)
Xxxxxxxxx & Xxxxx California 10,000 $5.00 $50,000.00
Xxxxxxxxx & Xxxxx Employee Venture 10,000 $5.00 $50,000.00
Fund, X.X. XX
Access Technology Partners, L.P. 160,000 $5.00 $800,000.00
Access Technology Partners Brokers 3,200 $5.00 $16,000.00
Fund, L.P.
H&Q Niku Investors, LLC 16,800 $5.00 $84,000.00
Xxxxxx X. Xxxxxxxxx 1,132 $5.00 $5,660.00
000 Xxxxx Xxx
Xxxxx Xxxx, XX 00000
Xxxxxxx Xxxxxx 20,000 $5.00 $100,000.00
0000 Xxxxxxx Xxxxx
Xxxx Xxxx, XX 00000
Xxxxx Xxxxxxx 5,000 $5.00 $25,000.00
c/x Xxxxxx Capital Management, L.L.C.
0000 Xxxxx Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Xxxx X. Xxxxx 14,267 $5.00 $71,335.00
000 Xxxxxx Xxxxxx
Xxxxxxxxxx, XX 00000
Xxxxxx Ventures 286,000 $5.00 $1,430,000.00
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Attn: Xxxxxxx X. Xxxxxx
Xxxxx Xxxxxx 5,000 $5.00 $25,000.00
c/o SMART Modular Technologies, Inc.
0000 Xxxxxxx Xxxxxxx
Xxxxxxx, XX 00000
29
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
Xxxx Xxxxxx 5,000 $5.00 $25,000.00
c/o Niku Corporation
000 Xxxx Xxxxxx
Xxxxxxx Xxxx, XX 00000
Xxxx and Xxxxxx Xxxxxx 5,000 $5.00 $25,000.00
c/o Niku Corporation
000 Xxxx Xxxxxx
Xxxxxxx Xxxx, XX 00000
The Phoenix Partners IV Limited Partnership 100,000 $5.00 $500,000.00
0000 Xxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Attn: Xxxxx Xxxxxxxx
Xxxxxx Xxxxxx Partners, LLC 27,178 $5.00 $135,890.00
000 Xxxxxxxxx Xxxx.
Xxxxxxxx, XX 00000
Attn: Xxxxx Xxxxx
X. Xxxxxxxxxx 30,000 $5.00 $150,000.00
0000 Xxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
Xxxxxxxxxxxxxxx Xxxxxxxxxxx 20,000 $5.00 $100,000.00
0000 Xxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Xxxxxxx X. Xxxxxxxx 20,000 $5.00 $100,000.00
000 Xxxxx Xxxxxx
Xxx Xxxx, XX 00000
Xxxxx entities (total is $3 million)
Attn: Xxxxxxx X. Xxxx
Xxxxx Fund Management LLC
000 Xxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Quantum Industrial Partners LDC 540,000 $5.00 $2,700,000.00
30
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
SFM Domestic Investments LLC 60,000 $5.00 $300,000.00
Xxxxxxxx X. Xxxxxxx III 4,268 $5.00 $21,340.00
c/o Trust Company of the West
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
Tailwind Capital Partners, L.P. 150,000 $5.00 $750,000.00
Attn: Xxxxxx Xxxxxxxx
Xxx Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
TCS-America 100,000 $5.00 $500,000.00
Attn: Xxxx Xxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, XX 00000
Venrock entities (total is $1,940,000)
Venrock Associates 151,126 $5.00 $755,630.00
Xxx Xxxxxxxxxxx, CFO
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Venrock Associates II, L.P. 217,474 $5.00 $1,087,370.00
Xxx Xxxxxxxxxxx, CFO
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Venrock Entrepreneurs Fund, L.P. 19,400 $5.00 $97,000.00
Xxx Xxxxxxxxxxx, CFO
0000 Xxxx Xxxx Xxxx, Xxxxx 000
Xxxxx Xxxx, XX 00000
Walnut Ventures, LLC 5,000 $5.00 $25,000.00
Attn: Xxxxxxxx Xxxxxxxxx
c/o Trust Company of the West
000 Xxxxx Xxxxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
31
PURCHASE
NO. OF PRICE PER AGGREGATE
NAME SHARES SHARE PURCHASE PRICE
---- ------ --------- --------------
X. X. Xxxxxxx III, L.P. 750,134 $5.00 $3,750,670.00
000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxx Xxxxx
Whitney Strategic Partners III, L.P. 18,074 $5.00 $90,370.00
000 Xxxxx Xxxxxx
Xxxxxxxx, XX 00000
Attn: Xxx Xxxxx
TOTALS: 7,998,012 $39,990,060.00
========= ==============
32
FIRST AMENDMENT TO
NIKU CORPORATION
FOURTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
THIS FIRST AMENDMENT TO FOURTH AMENDED AND RESTATED INVESTOR RIGHTS
AGREEMENT (this "First Amendment") is made as of the 8th day of December, 1999
by and between Niku Corporation, a Delaware corporation (the "Company") and
those holders of the Company's securities whose names are set forth on the
signature pages hereto (each an "Investor" and collectively the "Investors").
RECITALS
A. The Company, the Investors and other holders of the Company's
securities entered into the Fourth Amended and Restated Investor Rights
Agreement (the "Rights Agreement") dated as of November 17, 1999. Capitalized
terms used herein without definition shall have the meanings set forth in the
Rights Agreement. Capitalized terms defined herein (except for the term
"Investors") shall be deemed incorporated in the Rights Agreement.
B. The Company, its wholly-owned subsidiary Niku Acquisition Corporation
("Merger Sub") and Proamics Corporation ("Proamics") have entered into an
Agreement and Plan of Reorganization dated as of November 16, 1999 (the "Plan")
with respect to the Company's acquisition of Proamics and the merger of Proamics
with and into Merger Sub (the "Merger"). The Plan provides that the holders of
preferred stock of Proamics immediately prior to the effective time of the
Merger (each a "Proamics Preferred Holder" and collectively the "Proamics
Preferred Holders") will be entitled to receive Series D Preferred Stock of the
Company in exchange for their Proamics preferred stock.
C. The closing of the transactions contemplated under the Plan is
conditioned on the Proamics Preferred Holders becoming parties to the Rights
Agreement.
AGREEMENT
THE PARTIES AGREE AS FOLLOWS:
1. Consent by Investors. Each Investor hereby consents to the amendment
of the Rights Agreement set forth in Section 2 below.
2. Amendment. Section 4.1 of the Rights Agreement shall be amended by
inserting the following immediately after the first sentence thereof:
Each Proamics Preferred Holder receiving Series D Preferred Stock
under the Plan shall become a "New Investor" hereunder, when such
Proamics Preferred Holder executes a counterpart signature page
hereof and without the need for an amendment hereto except to add
such Proamics Preferred Holder's name to Exhibit B hereto.
33
The parties hereto have executed this First Amendment to Fourth Amended
and Restated Investor Rights Agreement as of the date first written above.
NIKU CORPORATION
By:
-----------------------------------------
Xxxxxx Xxxxxxx, President
INVESTORS:
Xxxxxx and Xxxxxx X. Xxxxxxx,
Trustees of the Dibachi Family
Trust UDT Dated 2-11-98
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Xxxxxxx 1996 Children's Trust
UTA Dated 3-11-96, Xxxxxx
Xxxxxx, Trustee
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Xxxxxxx X. Xxxxxxx and Xxxxxxx X. Xxxxxxx,
Trustees of the Xxxxxxx Family Trust U/D/T
Dated 4-2-97
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Venrock Associates
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[SIGNATURE PAGE TO FIRST AMENDMENT TO FOURTH AMENDED
AND RESTATED INVESTOR RIGHTS AGREEMENT]
34
Venrock Associates II
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Venrock Entrepreneurs
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
X.X. Xxxxxxx III, L.P.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Whitney Strategic Partners III, L.P.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Amerindo Technology Growth Fund II
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Charter Growth Capital, L.P.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[SIGNATURE PAGE TO FIRST AMENDMENT TO FOURTH AMENDED
AND RESTATED INVESTOR RIGHTS AGREEMENT]
35
Charter Growth Co-Investment Fund, L.P.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
CGC Investors, L.P.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
CNET Investments, Inc.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Comdisco, Inc.
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Essex Private Placement Fund II
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
Quantum Industrial Partners LDC (Xxxxx)
By:
-----------------------------------------
Name:
---------------------------------------
Title:
--------------------------------------
[SIGNATURE PAGE TO FIRST AMENDMENT TO FOURTH AMENDED
AND RESTATED INVESTOR RIGHTS AGREEMENT]
