FLUIDIGM CORPORATION EIGHTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT June 13, 2006
Exhibit 4.3
FLUIDIGM CORPORATION
EIGHTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
June 13, 2006
TABLE OF CONTENTS
Page | ||||||||
SECTION 1 Restrictions on Transferability; Registration Rights | 1 | |||||||
1.1 | Certain Definitions | 1 | ||||||
1.2 | Restrictions | 4 | ||||||
1.3 | Restrictive Legend | 5 | ||||||
1.4 | Notice of Proposed Transfers | 5 | ||||||
1.5 | Requested Registration | 6 | ||||||
1.6 | Company Registration | 8 | ||||||
1.7 | Registration on Form S-3 | 9 | ||||||
1.8 | Expenses of Registration | 10 | ||||||
1.9 | Registration Procedures | 10 | ||||||
1.10 | Indemnification | 12 | ||||||
1.11 | Information by Holder | 14 | ||||||
1.12 | Reports Under Securities Exchange Act of 1934 | 14 | ||||||
1.13 | Transfer of Registration Rights | 15 | ||||||
1.14 | Standoff Agreement | 15 | ||||||
1.15 | No Right to Delay Registration | 16 | ||||||
1.16 | Termination of Rights | 16 | ||||||
1.17 | Limitations on Subsequent Registration Rights | 16 | ||||||
SECTION 2 Affirmative Covenants of the Company | 16 | |||||||
2.1 | Delivery of Financial Statements | 17 | ||||||
2.2 | Additional Information Rights | 17 | ||||||
2.3 | Confidentiality | 18 | ||||||
2.4 | Visitation Rights | 18 | ||||||
2.5 | Stock Option Vesting | 18 | ||||||
2.6 | Insurance | 18 | ||||||
2.7 | Proprietary Information Agreements | 19 | ||||||
2.8 | Invention Assignments | 19 | ||||||
2.9 | Key-Man Life Insurance | 19 | ||||||
2.10 | Compliance with Laws | 19 | ||||||
2.11 | Termination of Covenants | 19 | ||||||
SECTION 3 Right of First Offer For Company Securities | 19 | |||||||
3.1 | Right of First Offer | 19 | ||||||
3.2 | Sale of Securities by Company | 20 | ||||||
3.3 | Offer Amount | 20 | ||||||
3.4 | Financing | 20 | ||||||
3.5 | Termination of Right of First Offer | 21 | ||||||
SECTION 4 Right of First Offer with Respect to Founder Shares | 22 | |||||||
4.1 | Notice of Sales | 22 |
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TABLE OF CONTENTS
(continued)
(continued)
Page | ||||||||
4.2 | Purchase Right | 22 | ||||||
4.3 | Sale of Securities by Founder | 23 | ||||||
4.4 | Termination and Transfer | 23 | ||||||
4.5 | Prohibited Transfer | 23 | ||||||
SECTION 5 Right of Co-Sale | 23 | |||||||
5.1 | Notice of Sales | 23 | ||||||
5.2 | Participation Right | 24 | ||||||
5.3 | Sale of Securities by Founder | 25 | ||||||
5.4 | Termination and Transfer | 25 | ||||||
5.5 | Prohibited Transfers | 25 | ||||||
SECTION 6 Miscellaneous | 26 | |||||||
6.1 | Governing Law; Jurisdiction | 26 | ||||||
6.2 | Successors and Assigns | 26 | ||||||
6.3 | Notices, Etc | 26 | ||||||
6.4 | Delays or Omissions | 27 | ||||||
6.5 | Third Parties | 27 | ||||||
6.6 | Severability | 27 | ||||||
6.7 | Amendment and Waiver | 27 | ||||||
6.8 | Rights of Holders | 28 | ||||||
6.9 | Counterparts | 28 | ||||||
6.10 | Titles and Subtitles | 28 | ||||||
6.11 | Amendment and Restatement of Prior Agreement | 28 | ||||||
6.12 | Waiver of Right of First Offer | 28 | ||||||
6.13 | Aggregation of Stock | 28 | ||||||
6.14 | Jury Trial | 29 |
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EIGHTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
THIS EIGHTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (the “Agreement”) is entered into
as of June 13, 2006 by and among Fluidigm Corporation, a California corporation (the “Company”),
the persons set forth on EXHIBIT A hereto (the “New Investors”), the persons set forth on
the Schedule of Founders attached hereto as EXHIBIT B (the “Founders”), and the persons set
forth on EXHIBIT C hereto (the “Prior Investors”). The Prior Investors and the New
Investors are referred to herein collectively as the “Investors.”
WHEREAS, the Company has granted certain registration rights and other rights to the Founders
and the Prior Investors pursuant to that certain Seventh Amended and Restated Investor Rights
Agreement dated August 16, 2005 (the “Prior Agreement”); and
SECTION 1
1.1 Certain Definitions. As used in this Agreement, the following terms shall have
the following meanings:
“Affiliate” shall have the meaning set forth in Rule 405 of the Securities Act;
provided that for AllianceBernstein L.P. and its permitted transferees, the
definition of “Affiliate” shall also include (i) any general partner, officer or director of such
person, (ii) any private equity or venture capital fund now or hereafter existing (a “Fund”) for
which such person or an Affiliate of such person is a general partner or management company, and
(iii) if such person is a Fund, any other Fund that is directly or indirectly controlled by or
under common control with one or more general partners of such person, or that shares the same
management company with such person or an Affiliated management company.
“Commission” shall mean the Securities and Exchange Commission or any other federal agency at
the time administering the Securities Act.
“Eligible Securities” shall mean (i) the Series A Preferred Stock issued pursuant to the
Series A Preferred Stock Purchase Agreement dated December 1, 1999; (ii) the Series B Preferred
Stock issued pursuant to the Series B Preferred Stock Purchase Agreement dated July 5, 2000; (iii)
the Series C Preferred Stock issued pursuant to the Series C Preferred Stock Purchase Agreement
dated October 23, 2001; (iv) the Series C Preferred Stock issued pursuant to the Series C Preferred
Stock Purchase Agreement dated November 1, 2002; (v) the Series C Preferred Stock issued pursuant
to the Series C Preferred Stock and Warrant Purchase Agreement dated September 22, 2003; (vi) the
Series D Preferred Stock issued pursuant to the Series D Preferred Stock Purchase Agreement dated
December 18, 2003; (vii) the Series D Preferred Stock issued pursuant to the Series D Preferred
Stock Purchase Agreement dated August 16, 2005; (viii) the Series D Preferred Stock issued upon
conversion of convertible promissory note(s) issued pursuant to the Convertible Promissory Note
Purchase Agreement (the “CNPA”) dated December 18, 2003, as amended by Amendment No. 1 to
Convertible Note Purchase Agreement dated December 17, 2004, between the Company and Biomedical
Sciences Investment Fund Pte Ltd (the “BMSIF”); (ix) the Series D Preferred Stock issued upon
conversion of convertible promissory note(s) issued in connection with the Convertible Note
Agreement (the “CNA”) dated December 18, 2003, between the Company and Invus, L.P. (the “Invus”);
(x) the Series E Preferred Stock issued pursuant to the Purchase Agreement; (xi) all Securities
acquired by any Investor pursuant to the rights of first offer described in Sections 3 or 4 of this
Agreement; and (xii) any Securities issued with respect to the foregoing upon any stock split,
stock dividend, recapitalization, or similar event or upon any exercise or conversion, as
applicable.
“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, or any similar
federal statute, and the rules and regulations of the Commission thereunder, all as the same shall
be in effect at the time.
“Founders Shares” shall mean the shares of Common Stock of the Company issued to the Founders
as of the date of this Agreement or at any time in the future.
“Holder” shall mean (i) any Investor and any person to whom registration rights under this
Agreement have been transferred in accordance with Section 1.13 hereof, (ii) for the purposes of
Section 1.6 (and other portions of this Section 1, to the extent they relate to rights of
registration under Section 1.6), any Founder or holder of Other Shares and (iii) for the purposes
of Sections 1.5, 1.6 and 1.7 (and other portions of this Section 1, to the extent they relate to
rights of registration under Sections 1.5, 1.6 and 1.7), Warrantholders.
“Initial Public Offering” shall mean the first sale of Securities of the Company pursuant to
an effective registration statement under the Securities Act.
“Initiating Holders” shall mean Holders who in the aggregate hold a majority of the
Registrable Securities then held by Holders assuming conversion or exercise, as applicable, of all
Eligible Securities.
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“Lighthouse Preferred Warrant” shall mean the Preferred Stock Purchase Warrant dated March 29,
2005, pursuant to which Lighthouse Capital Partners V, L.P. (“Lighthouse”) may purchase shares of
the Company’s authorized Series D Preferred Stock.
“Other Shares” shall mean the shares of Common Stock of the Company issued pursuant to the
Common Stock Purchase Agreements dated July 17, 2001 and February 2005 by and between the Company
and President and Fellows of Harvard College.
“Permitted Transferee” shall mean (i) any general partner or retired general partner of any
Holder which is a partnership; (ii) any family member of a Holder or trust for the benefit of any
individual Holder; (iii) any Investor; (iv) an Affiliate of an Investor; or (v) any transferee who
acquires at least 40,000 shares of Eligible Securities.
The terms “register,” “registered” and “registration” refer to a registration effected by
preparing and filing a registration statement in compliance with the Securities Act, and the
declaration or ordering of the effectiveness of such registration statement.
“Registration Expenses” shall mean all expenses incurred by the Company in complying with
Sections 1.5, 1.6 and 1.7 hereof, including, without limitation, all registration, qualification,
stock exchange and filing fees, printing expenses, escrow fees, fees and disbursements of counsel
for the Company and accountants and other persons retained by or for the Company (including the
fees of one counsel for the Holders, not to exceed $25,000), blue sky fees and expenses, accounting
fees and the expense of any special audits incident to or required by any such registration (but
excluding the compensation of regular employees of the Company which shall be paid in any event by
the Company).
“Registrable Securities” means (i) any shares of Common Stock which are Eligible Securities,
(ii) any shares of Common Stock issuable upon the exercise or conversion, as applicable, of
Eligible Securities, (iii) for the purposes of Section 1.6 (and other portions of this Section 1,
to the extent they relate to rights of registration under Section 1.6) any shares of Common Stock
which are Founder Shares or Other Shares, and (iv) for the purposes of Sections 1.5, 1.6 and 1.7
(and other portions of this Section 1, to the extent they relate to rights of registration under
Sections 1.5, 1.6 and 1.7) any shares of Common Stock which are Warrant Shares; provided,
however, that shares of Common Stock shall be treated as Registrable Securities only if and
so long as they have not been (A) sold to or through a broker or dealer or underwriter in a public
distribution or a public securities transaction, (B) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under Section 4(1) thereof
so that all transfer restrictions and restrictive legends with respect thereto are removed upon the
consummation of such sale or (C) sold in a transaction in which the rights granted under this
Section 1 are not assigned in accordance with this Agreement.
“Restricted Securities” shall mean the securities of the Company required to bear the legends
set forth in Section 1.3 hereof.
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“Securities” shall mean shares of, or securities convertible into or exercisable for any
shares of, any class of capital stock of the Company.
“Securities Act” shall mean the Securities Act of 1933, as amended, or any similar federal
statute and the rules and regulations of the Commission thereunder, all as the same shall be in
effect at the time.
“Selling Expenses” shall mean all underwriting discounts and selling commissions and
applicable to the securities registered by the Holders and any fees and disbursements of counsel
for the Holders not included in the definition of Registration Expenses.
“Voting Agreement” shall mean the Second Amended and Restated Voting Agreement dated August
16, 2005 among the Company and certain stockholders of the Company.
“Warrant Shares” shall mean the shares of Common Stock of the Company issued or issuable upon
conversion of the (i) Series C Preferred Stock issued or issuable upon exercise or conversion of
(A) the warrant to purchase up to 17,500 shares of Series C Preferred Stock issued to TBCC Funding
Trust II (“TBCC”) pursuant to the Master Loan and Security Agreement dated March 27, 2002 by and
between the Company and Transamerica Technology Finance Corporation; (B) the warrant to purchase
up to 31,008 shares of Series C Preferred Stock issued to General Electric Capital Corporation (“GE
Capital”) in connection with the Master Security Agreement dated as of November 8, 2002, as amended
(the “Master Security Agreement”) by and between the Company and GE Capital; (C) the warrants to
purchase an aggregate of up to 90,000 shares of Series C Preferred Stock issued to Glaxo Group
Limited (“GGL”) in connection with the Development Collaboration and License Agreement dated
September 22, 2003 (the “License Agreement”); and (D) the warrants to purchase an aggregate of up
to 110,000 shares of Series C Preferred Stock issued to SmithKline Xxxxxxx Corporation (“SBC”) in
connection with the License Agreement; and (ii) the Series D Preferred Stock issued or issuable
upon exercise or conversion of (A) the warrant to purchase up to 37,500 shares of Series D
Preferred Stock dated March 18, 2004 and issued to GE Capital in connection with extensions of
credit to the Company; (B) the warrant to purchase up to 380,556 shares of Series D Preferred Stock
dated June 30, 2004 and issued to In-Q-Tel, Inc. (“In-Q-Tel”); (C) the Lighthouse Preferred
Warrant; and (D) the warrant to purchase up to 126,851 shares of Series D Preferred Stock dated
June 30, 2004 and issued to In-Q-Tel Employee Fund, LLC (“Employee Fund”) . GGL, SBC, TBCC, GE
Capital, In-Q-Tel, Employee Fund, and Lighthouse are collectively referred to herein as
“Warrantholders.”
“Worthington Shares” shall mean the Founder Shares issued to Xxxxx Xxxxxxxxxxx.
1.2 Restrictions. No Restricted Securities shall be sold, assigned, transferred or
pledged except upon the conditions specified in this Agreement. Each Holder will cause any
proposed purchaser, assignee, transferee or pledgee of its Restricted Securities to agree in
writing to
take and hold such securities subject to the provisions and upon the conditions specified in
this Agreement, including, without limitation, Section 1.14, except where such Restricted
Securities would cease to be Restricted Securities in connection with such proposed purchase,
assignment, transfer or pledge.
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1.3 Restrictive Legend. Each certificate representing Registrable Securities shall
(unless otherwise permitted by the provisions of Section 1.4 below) be stamped or otherwise
imprinted with a legend in the following form (in addition to any legend required under applicable
state securities laws):
“THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE BEEN ACQUIRED FOR INVESTMENT AND
HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE
“SECURITIES ACT”). SUCH SHARES MAY NOT BE SOLD, TRANSFERRED OR PLEDGED IN THE
ABSENCE OF SUCH REGISTRATION OR UNLESS THE COMPANY RECEIVES AN OPINION OF COUNSEL
(WHICH MAY BE COUNSEL FOR THE COMPANY), OR OTHER EVIDENCE, REASONABLY ACCEPTABLE TO
IT STATING THAT SUCH SALE OR TRANSFER IS EXEMPT FROM THE REGISTRATION AND PROSPECTUS
DELIVERY REQUIREMENTS OF THE SECURITIES ACT.”
“THE SHARES REPRESENTED BY THIS CERTIFICATE MAY BE TRANSFERRED ONLY IN ACCORDANCE
WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE SHAREHOLDER, A COPY OF
WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.”
“THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A MARKET STAND-OFF
AGREEMENT IN THE EVENT OF A PUBLIC OFFERING, A COPY OF WHICH IS ON FILE WITH THE
SECRETARY OF THE COMPANY.”
Each Holder consents to the Company making a notation on its records and giving instructions
to any transfer agent of the Restricted Securities in order to implement the restrictions on
transfer established in this Section 1.
1.4 Notice of Proposed Transfers. Each Holder of each certificate representing
Restricted Securities, by acceptance thereof, agrees to comply in all respects with the
restrictions on transfer contained in Sections 1.2, 1.3, 1.4 and 1.14 of this Agreement. Solely
for purposes of the foregoing sentence and for the sake of clarification, the term “Holder” shall
also include and the term “Restricted Securities” shall also apply to any Founder, holder of Other
Shares or Warrantholders. Prior to any proposed sale, assignment, transfer or pledge of any
Restricted Securities (other than any transfer not involving a change in beneficial ownership),
unless there is in effect a registration statement under the Securities Act covering the proposed
transfer, the Holder thereof shall give written notice to the Company of such Holder’s intention to
effect such transfer, sale, assignment or
pledge. Each such notice shall describe the manner and circumstances of the proposed
transfer, sale, assignment or pledge in sufficient detail, and shall be accompanied at such
Holder’s expense by either (i) a written opinion of legal counsel who shall, and whose legal
opinion shall be, reasonably satisfactory to the Company, addressed to the Company, to the effect
that the proposed transfer of the Restricted Securities may be effected without registration under
the Securities Act and applicable state securities laws, or (ii) a “no action” letter from the
Commission
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to the effect that the transfer of such securities without registration will not result
in a recommendation by the staff of the Commission that action be taken with respect thereto, or
(iii) any other evidence reasonably satisfactory to counsel to the Company, whereupon the Holder of
such Restricted Securities shall be entitled to transfer such Restricted Securities in accordance
with the terms of the notice delivered by the Holder to the Company; provided,
however, that no such legal opinion, “no action” letter or other evidence shall be required
with respect to a transfer to an Affiliate. Each certificate evidencing the Restricted Securities
transferred as above provided shall bear, except if such transfer is made pursuant to Rule 144, the
appropriate restrictive legend set forth in Section 1.3 above, except that such certificate shall
not bear such restrictive legend if, in the opinion of counsel for such Holder and reasonably
acceptable to the Company, such legend is not required in order to establish compliance with any
provisions of the Securities Act or this Agreement.
(i) promptly give written notice of the proposed registration to all other Holders; and
(ii) use its best efforts to effect as soon as practicable such registration (including,
without limitation, the execution of an undertaking to file post-effective amendments, appropriate
qualification under applicable blue sky or other state securities laws and appropriate compliance
with applicable regulations issued under the Securities Act and any other governmental requirements
or regulations) as may be so requested and as would permit or facilitate the sale and distribution
of all or such portion of such Registrable Securities as are specified in such request, together
with all or such portion of the Registrable Securities of any Holder or Holders joining in such
request as are specified in a written request received by the Company within 15 days after receipt
of the written notice from the Company; provided, however, that the Company shall
not be obligated to take any action to effect any such registration pursuant to this Section 1.5:
(1) Prior to six months following the closing of the Company’s Initial Public Offering;
(2) During the period starting with the date 60 days prior to the Company’s estimated date of
filing of, and ending on the date three months immediately following the effective date of, any
registration statement (other than a registration of Securities in a Rule 145 transaction or with
respect to an employee benefit plan) pertaining to Securities of the Company (subject to Section
1.6(a) hereof), provided that the Company is actively employing in good faith all reasonable
efforts to cause such registration statement to be filed and become effective and that the Company
provides the Initiating Holders written notice of its intent to file such
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registration statement
within 30 days of receiving the request for registration from the Initiating Holders and provided
further, however, that the Company may not utilize this right more than once in any 12-month
period.
(3) After the Company has effected two registrations pursuant to this Section 1.5; or
(4) If the Company shall furnish to such Holders a certificate, signed by the President of the
Company, stating that in the good faith judgment of the Board of Directors it would be seriously
detrimental to the Company or its shareholders for a registration statement to be filed in the near
future, in which case the Company’s obligation to use its best efforts to register under this
Section 1.5 shall be deferred for a period not to exceed 90 days from the date of receipt of
written request from the Initiating Holders; provided, however, that the Company may not utilize
this right more than once in any 12-month period.
The Company shall (together with all Holders proposing to distribute their securities through
such underwriting) enter into an underwriting agreement in customary form with the managing
underwriter selected for such underwriting by the Company and a majority of the Holders.
Notwithstanding any other provision of this Section 1.5, if the managing underwriter advises the
Company in writing that marketing factors require a limitation of the number of shares to be
underwritten, then the Company shall so advise all Holders of Registrable Securities who indicated
their intent to participate in the registration in a timely manner, and the number of shares of
Registrable Securities that may be included in the registration and underwriting shall be allocated
among such Holders in proportion, as nearly as practicable, to the respective number of Registrable
Securities held by such Holders at the time of filing the registration statement, provided,
however, that the number of shares of Registrable Securities to be included in such
underwriting shall not be reduced unless all Worthington Shares, all Other Shares and all other
Securities that are not Registrable Securities (other than Securities to be sold for the account of
the Company) are first
entirely excluded from the underwriting. No Registrable Securities excluded from the
underwriting by reason of the underwriter’s marketing limitation shall be included in such
registration. To facilitate the allocation of shares in accordance with the above provisions, the
Company or the underwriters may round the number of shares allocated to any Holder to the nearest
100 shares.
If any Holder of Registrable Securities disapproves of the terms of the underwriting, such
person may elect to withdraw therefrom by written notice to the Company, the managing underwriter
and the Initiating Holders. The Registrable Securities so withdrawn shall also be withdrawn from
registration.
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1.6 Company Registration.
(i) promptly give to each Holder written notice thereof; and
(ii) include in such registration (and any related qualification under blue sky laws or other
compliance), and in any underwriting involved therein, all the Registrable Securities specified in
a written request or requests made within 15 days after receipt of such written notice from the
Company by any Holder.
All Holders proposing to distribute their 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 1.6, if the
managing underwriter advises the Company in writing that marketing factors require a limitation of
the number of shares to be underwritten, then the Company shall so advise all Holders of
Registrable Securities and the number of shares of Registrable Securities that may be included in
the registration and underwriting shall be allocated among all Holders thereof in proportion, as
nearly as practicable, to the respective number of Registrable Securities held by such Holders at
the time of filing the registration statement; provided, however, that, no
Registrable Securities shall be excluded until all Worthington Shares, all Other Shares and all
other Securities that are not Registrable Securities
(other than Securities to be sold for the account of the Company) are first excluded, and
provided further, that, except in the case of the Company’s Initial Public Offering
(where Registrable Securities may be excluded entirely), the number of Registrable Securities
included in such underwriting shall not be reduced below 25% of the total number of shares in the
underwriting. No Registrable Securities excluded from the underwriting by reason of the
underwriter’s marketing limitation shall be included in such registration. To facilitate the
allocation of shares in accordance with the above provisions, the Company or the underwriters may
round the number of shares allocated to any Holder to the nearest 100 shares. The Company may
include shares of Common Stock held by shareholders other than Holders in a registration statement
pursuant to this Section 1.6 to the extent that the amount of Registrable Securities otherwise
includible in such registration statement would not thereby be diminished.
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If any Holder or other holder disapproves of the terms of any such underwriting, he or she may
elect to withdraw therefrom by written notice to the Company and the managing underwriter. The
Registrable Securities so withdrawn shall also be withdrawn from such registration and, in the case
of the Company’s Initial Public Offering, shall be subject to Section 1.14.
(a) If any Holder or Holders request that the Company file a registration statement on Form
S-3 (or any successor form to Form S-3) for a public offering of Registrable Securities, the
reasonably anticipated aggregate price to the public of which, net of underwriting discounts and
commissions, would exceed $2,000,000, and the Company is then entitled to use Form S-3 under
applicable Commission rules to register the Registrable Securities for such an offering, the
Company will:
(i) promptly give written notice of the proposed registration to all other Holders; and
(ii) use its best efforts to effect as soon as practicable such registration (including,
without limitation, the execution of an undertaking to file post-effective amendments, appropriate
qualification under applicable blue sky or other state securities laws and appropriate compliance
with applicable regulations issued under the Securities Act and any other governmental requirements
or regulations) as may be so requested and as would permit or facilitate the sale and distribution
of all or such portion of such Registrable Securities as are specified in such request, together
with all or such portion of the Registrable Securities of any Holder or Holders joining in such
request as are specified in a written request received by the Company within 15 days after receipt
of the written notice from the Company; provided, however, that the Company shall
not be obligated to take any action to effect any such registration pursuant to this Section 1.7:
(1) if the Company, within ten (10) days of the receipt of the request for registration
pursuant to this Section 1.7, gives notice of its bona fide intention to effect the filing of a
registration statement with the Commission within ninety (90) days of receipt of such request
(other than with respect to a registration statement relating to a Rule 145 transaction or an
employee benefit plan or any other registration which is not appropriate for the registration of
Registrable Securities);
(2) during the period starting with the date sixty (60) days prior to the Company’s estimated
date of filing of, and ending on the date three months immediately following, the effective date of
any registration statement pertaining to Securities of the Company (other than with respect to a
registration statement relating to a Rule 145 transaction or an employee benefit plan), provided
that the Company is actively employing in good faith all reasonable efforts to cause such
registration statement to be filed and become effective; or
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(3) if the Company shall furnish to such Holder or Holders a certificate signed by the
President of the Company stating that in the good faith judgment of the Board of Directors it would
be seriously detrimental to the Company or its shareholders for registration statements to be filed
in the near future, then the Company’s obligation to use its best efforts to file a registration
statement shall be deferred for a period not to exceed 90 days from the receipt of the request to
file such registration by such Holder or Holders; provided further, however, that
the Company may not utilize the rights provided for in subsections (1) and (2) above and this
subsection (3) more than once in total in any twelve month period. For the avoidance of doubt, if
the Company utilizes any of the rights provided for in subsections (1), (2) and (3), it shall not
have the right to utilize the same right again; nor shall it have the right to utilize any of the
other rights provided in subsections (1), (2) and (3) for twelve months.
1.8 Expenses of Registration. All Registration Expenses incurred in connection with
any registration pursuant to Sections 1.5, 1.6 and 1.7 shall be borne by the Company. If a
registration proceeding is begun upon the request of Holders pursuant to Section 1.5 or 1.7, but
such request is subsequently withdrawn at the request of the Holders, then the Holders of
Registrable Securities to have been registered may either: (i) bear all Registration Expenses of
such proceeding, pro rata on the basis of the number of shares to have been registered, in which
case the Company shall be deemed not to have effected a registration pursuant to Section 1.5(a) or
1.7(a) of this Agreement as applicable; provided, however, that the Company, and
not the Holders, shall be required to pay for the Registration Expenses if the Holders learn of a
materially adverse change in the condition, business, or prospects of the Company from that known
to the Holders at the time of their request and have withdrawn the request promptly following
discovery of such material adverse
change; or (ii) if the registration is being effected pursuant to Section 1.5, require the
Company to bear all Registration Expenses of such proceeding, in which case the Company shall be
deemed to have effected a registration pursuant to Section 1.5(a). Unless otherwise stated, all
other Selling Expenses relating to securities registered on behalf of the Holders shall be borne by
the Holders of the registered securities included in such registration pro rata on the basis of the
number of shares so registered, provided that to the extent a Holder elects to
retain its own counsel (an “Additional Counsel”) separate from the counsel for all the Holders
permitted pursuant to the definition of “Registration Expenses” under Section 1.1, then such Holder
shall exclusively bear the costs of such Additional Counsel.
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(a) Prepare and file with the Commission a registration statement with respect to such
Registrable Securities and use its best efforts to cause such registration statement to become
effective, and, upon the request of the Holders of a majority of the Registrable Securities
registered thereunder, keep such registration statement effective for a period of up to one hundred
twenty (120) days or until the distribution described in the registration statement has been
completed; provided, however, that such 120-day period shall be extended for a
period of time equal to the period the Holder refrains from selling any securities included in such
registration at the request of an underwriter of Common Stock (or other securities) of the Company.
(b) Prepare and file with the Commission, in consultation with the Holders, such amendments
and supplements to such registration statement and the prospectus used in connection with such
registration statement as may be necessary to comply with the provisions of the Securities Act with
respect to the disposition of all securities covered by such registration statement.
(c) Furnish to the Holders participating in such registration and to the underwriters of the
securities being registered such reasonable number of copies of the registration statement,
preliminary prospectus, final prospectus and such other documents as such underwriters may
reasonably request in order to facilitate the public offering of such securities.
(d) Use its best efforts to register and qualify the securities covered by such registration
statement under such other securities or Blue Sky laws of such jurisdictions as shall be reasonably
requested by the Holders; provided that the Company shall not be required in connection therewith
or as a condition thereto to qualify to do business or to file a general consent to service of
process in any such states or jurisdictions, unless the Company is already subject to service in
such jurisdiction and except as may be required by the Securities Act.
(e) In the event of any underwritten public offering, enter into and perform its obligations
under an underwriting agreement, in usual and customary form, with the managing
underwriter of such offering. Each Holder participating in such underwriting shall also enter
into and perform its obligations under such an agreement.
(f) Notify each Holder of Registrable Securities covered by such registration statement at any
time when a prospectus relating thereto is required to be delivered under the Securities Act of the
happening of any event as a result of which the prospectus included in such registration statement,
as then in effect, includes an untrue statement of a material fact or omits to state a material
fact required to be stated therein or necessary to make the statements therein not misleading or
incomplete in light of the circumstances then existing, and at the request of any such Holder,
prepare and furnish to such Holder a reasonable number of copies of a supplement to or an amendment
of such prospectus as may be necessary so that, as thereafter delivered to the purchasers of such
shares, such prospectus shall not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements therein not
misleading or incomplete in the light of the circumstances then existing.
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(g) Cause all such Registrable Securities registered pursuant hereunder to be listed on each
securities exchange, or quoted in a U.S. automated inter-dealer quotation system, as the case may
be, on which similar securities issued by the Company are then listed or quoted.
(h) Provide a transfer agent and registrar for all Registrable Securities registered pursuant
hereunder and a CUSIP number for all such Registrable Securities, in each case not later than the
effective date of such registration.
(i) In the event of any underwritten public offering, cooperate with the selling Holders, the
underwriters participating in the offering and their counsel in any due diligence investigation
reasonably requested by the selling Holders or the underwriters in connection therewith, and
participate, to the extent reasonably requested by the managing underwriter for the offering or the
selling Holder, in efforts to sell the Registrable Securities under the offering (including,
without limitation, participating in “roadshow” meetings with prospective investors) that would be
customary for underwritten primary offerings of a comparable amount of equity securities by the
Company.
1.10 Indemnification.
(a) The Company will indemnify and defend each Holder, each of its officers and directors and
partners, and each person controlling such Holder within the meaning of Section 15 of the
Securities Act, with respect to which registration, qualification or compliance is being effected
pursuant to this Section 1, and each underwriter, if any, and each person who controls any
underwriter within the meaning of Section 15 of the Securities Act, against all expenses, claims,
losses, damages or liabilities (or actions in respect thereof), including any of the foregoing
incurred in settlement of any litigation, commenced or threatened, arising out of or based on any
untrue statement (or alleged untrue statement) of a material fact contained in any registration
statement, prospectus, preliminary prospectus, offering circular or other document, or any
amendment or supplement thereto, incident to any such registration, qualification or compliance, or
based on any
omission (or alleged omission) to state therein a material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances in which they were made,
not misleading, or any violation or any alleged violation by the Company of the Securities Act or
the Exchange Act or any state securities law, or any rule or regulation promulgated thereunder,
applicable to the Company in connection with any such registration, qualification or compliance,
and the Company will reimburse each such Holder, each of its officers and directors, and each
person controlling such Holder, each such underwriter and each person who controls any such
underwriter, for any legal and any other expenses reasonably incurred in connection with
investigating, preparing or defending any such claim, loss, damage, liability or action, as such
expenses are incurred, provided that the Company will not be liable in any such case to the extent
that any such claim, loss, damage, liability or expense arises out of or is based on any untrue
statement or omission or alleged untrue statement or omission, made in reliance upon and in
conformity with written information furnished to the Company by an instrument duly executed by such
Holder, controlling person or underwriter and stated to be specifically for use therein.
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(b) Each Holder will, if Registrable Securities held by such Holder are included in the
securities as to which such registration, qualification or compliance is being effected, indemnify
the Company, each of its directors and officers, each underwriter, if any, of the Company’s
securities covered by such a registration statement, each person who controls the Company or such
underwriter within the meaning of Section 15 of the Securities Act, and each other such Holder,
each of its officers and directors and each person controlling such Holder within the meaning of
Section 15 of the Securities Act, against all claims, losses, damages and liabilities (or actions
in respect thereof) arising out of or based on any untrue statement (or alleged untrue statement)
of a material fact contained in any such registration statement, prospectus, offering circular or
other document, or any omission (or alleged omission) to state therein a material fact required to
be stated therein or necessary to make the statements therein not misleading, and will reimburse
the Company, such Holders, such directors, officers, persons, underwriters or control persons for
any legal or any other expenses reasonably incurred in connection with investigating or defending
any such claim, loss, damage, liability or action, as such expenses are incurred, in each case to
the extent, but only if and to the extent, that such untrue statement (or alleged untrue statement)
or omission (or alleged omission) is made in such registration statement, prospectus, offering
circular or other document in reliance upon and in conformity with written information furnished to
the Company by an instrument duly executed by such Holder and stated to be specifically for use
therein; provided, however, that the liability of any Holder shall be limited to
the net proceeds received by such Holder from the sale of Securities pursuant to such registration.
(c) Each party entitled to indemnification under this Section 1.10 (the “Indemnified Party”)
shall give notice to the party required to provide indemnification (the “Indemnifying Party”)
promptly after such Indemnified Party has actual knowledge of any claim as to which indemnity may
be sought, and shall permit the Indemnifying Party to assume the defense of any such claim or any
litigation resulting therefrom, provided that counsel for the Indemnifying Party, who shall conduct
the defense of such claim or litigation, shall be approved by the Indemnified Party (whose approval
shall not unreasonably be withheld), and the Indemnified Party
may participate in such defense at such party’s expense; 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 of any Indemnified Party to give notice as provided herein shall
not relieve the Indemnifying Party of its obligations under this Section 1 unless, and only to the
extent that, the failure to give such notice is materially prejudicial to an Indemnifying Party’s
ability to defend such action. No Indemnifying Party, in the defense of any such claim or
litigation, shall, except with the consent of each Indemnified Party, consent to entry of any
judgment or enter into any settlement which does not include as an unconditional term thereof the
giving by the claimant or plaintiff to such Indemnified Party of a release from all liability in
respect to such claim or litigation.
(d) If the indemnification provided for in this Section 1.10 is held by a court of competent
jurisdiction to be unavailable to an Indemnified Party with respect to any loss,
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liability, claim,
damage, or expense referred to therein, then the Indemnifying Party, in lieu of indemnifying such
Indemnified Party hereunder, shall contribute to the amount paid or payable by such Indemnified
Party as a result of such loss, liability, claim, damage, or expense in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Party on the one hand and of the
Indemnified Party on the other in connection with the statements or omissions that resulted in such
loss, liability, claim, damage, or expense as well as any other relevant equitable considerations
(except to the extent that contribution is not permitted under Section 11(f) of the Securities
Act); provided, however, that, no Holder will be required to pay any amount under
this subsection 1.10(d) in excess of the net proceeds from the sale of all Registrable Securities
offered and sold by such Holder pursuant to such registration statement. 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 with respect to the rights and obligations of each of the
parties to such underwriting agreement.
(f) The obligations of the Company and Holders under this Section 1.10 shall survive the
completion of any offering of Registrable Securities in a registration statement under this Section
1, and otherwise.
1.11 Information by Holder. The Holder or Holders of Registrable Securities included
in any registration shall furnish to the Company such information regarding such Holder or Holders,
the Securities held by them and the distribution proposed by such Holder or Holders as the Company
may reasonably request in writing and as shall be required in connection with any registration
referred to in this Section 1.
1.12 Reports Under Securities Exchange Act of 1934. With a view to making available
to the Holders the benefits of Rule 144 promulgated under the Securities Act and any other rule or
regulation of the Commission 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
use its best efforts to:
(a) make and keep public information available, as those terms are understood and defined in
Rule 144 under the Securities Act, at all times after the effective date that the Company becomes
subject to the reporting requirements of the Securities Act or the Exchange Act;
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(b) file with the Commission in a timely manner all reports and other documents required of
the Company under the Securities Act and the Exchange Act (at any time after it has become subject
to such reporting requirements);
(c) register its Common Stock under Section 12 of the Exchange Act at such time as it is
required to do so pursuant to the Exchange Act; and
(d) furnish to any Holder, so long as the Holder owns any Registrable Securities, forthwith
upon request (i) a written statement by the Company as to its compliance with the reporting
requirements of 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), or that it qualifies as a registrant
whose securities may be resold pursuant to Form S-3 (at any time after it so qualifies), (ii) a
copy of the most recent annual or quarterly report of the Company and such other reports and
documents so filed by the Company, and (iii) such other information in the possession of or
reasonably obtainable by the Company as may be reasonably requested in availing any Holder of any
rule or regulation of the Commission which permits the selling of any such securities without
registration or pursuant to such form.
1.13 Transfer of Registration Rights. The rights to cause the Company to register
Registrable Securities granted to the Investors under Sections 1.5, 1.6 and 1.7 may be assigned to
a transferee or assignee in connection with any transfer or assignment of Eligible Securities by an
Investor; provided that (a) such transfer may otherwise be effected in accordance with applicable
securities laws, (b) notice of such assignment is given to the Company, (c) such transferee is a
Permitted Transferee and (d) such transferee or assignee agrees to be bound by and subject to the
terms and conditions of this Agreement.
1.14 Standoff Agreement.
(a) Each Holder agrees in connection with the first sale of the Company’s Common Stock in a
firm commitment underwritten public offering pursuant to an effective registration statement under
the Securities Act, upon notice by the Company or the underwriters managing such public offering,
not to sell, make any short sale of, loan, pledge (or otherwise encumber or hypothecate), grant any
option for the purchase of, or otherwise directly or indirectly dispose of any Securities (other
than those included in the registration) without the prior written consent of the Company and such
managing underwriters for such period of time as the Board of Directors establishes pursuant to its
good faith negotiations with such managing underwriters; provided, however that:
(i) such agreement shall not exceed one hundred eighty (180) days;
(ii) such agreement shall not apply to transfers to an Affiliate, provided that such Affiliate
agrees to be bound by the terms of such agreement, to the same extent as if such transferee were
the original party thereunder;
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(iii) a Holder shall not be subject to such agreement unless (A) all executive officers and
directors of the Company, (B), all shareholders of the Company holding more than 1% of the
Company’s outstanding capital stock; and (C) all other Holders and holders of other registration
rights, are subject to or obligated to enter into similar agreements; and
(iv) if and when any person identified in clause (iii) is released, in whole or in part, from
such agreement (whether or not such release is contemplated at the time of the offering) or if any
such agreement is terminated, the Holder shall be concurrently released on a pro rata basis based
on the number of shares held by such person and the Holder.
(b) Each Holder agrees that prior to the Initial Public Offering it will not transfer
securities of the Company unless each transferee agrees in writing to be bound by all of the
provisions of this Section 1.14; provided that this Section 1.14(b) shall not apply to transfers
pursuant to a registration statement.
(c) Each Holder hereby consents to the placement of stop transfer orders with the Company’s
transfer agent in order to enforce the foregoing provision and agrees to execute a market standoff
agreement with said underwriters in customary form consistent with the provisions of this Section
1.14.
1.15 No Right to Delay Registration. No holder shall restrain, enjoin, or otherwise
delay any registration hereunder, notwithstanding any controversy that might arise with respect to
the interpretation or implementation of this Agreement.
1.16 Termination of Rights. No Holder shall be entitled to exercise any right
provided for in this Section 1 after the earlier of (i) five (5) years following the consummation
of the Initial Public Offering, and (ii) that date following the Initial Public Offering upon which
each Holder holds less than 1% of the then issued and outstanding shares of capital stock of the
Company and all such shares may be sold under Section 5 of the Securities Act whether pursuant to
Rule 144 or another applicable exemption during any 90 day period. All other provisions hereof
relating to registration rights shall continue to be effective despite any termination of such
registration rights pursuant to this section.
1.17 Limitations on Subsequent Registration Rights. From and after the date of this
Agreement, the Company shall not enter into any agreement granting any holder or prospective holder
of any securities of the Company registration rights with respect to such securities unless (i)
such new registration rights, are subordinate to the registration rights granted Holders hereunder
and include similar market stand-off obligations or (ii) such new registration rights are approved
by the Holders of 50% of the Registrable Securities then held by Holders (assuming exercise or
conversion of all outstanding Eligible Securities); provided, however, that
Warrantholders may enter into this Agreement by executing and delivering a counterpart signature
page to this Agreement.
SECTION 2
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The Company hereby covenants and agrees as follows:
2.1 Delivery of Financial Statements. The Company will furnish to each Investor who
holds at least 40,000 shares of Eligible Securities (as adjusted for stock splits and
combinations):
(a) as soon as reasonably practicable, an income statement for such fiscal year, a balance
sheet of the Company and statement of shareholder’s equity as of the end of such year, and a cash
flow statement 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; and
(b) as soon as practicable, but in any event within forty-five (45) days after the end of each
of the first three (3) quarters of each fiscal year of the Company, an unaudited income statement,
cash flow statement for such fiscal quarter and an unaudited balance sheet as of the end of such
fiscal quarter.
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an unaudited
income statement and cash flow statement and unaudited balance sheet for and as of the end of such
month, in reasonable detail.
2.3 Confidentiality. Each Investor agrees to use commercially reasonable efforts to
maintain the confidentiality of information obtained pursuant to this Section 2, provided that such
obligation shall not apply to (i) information previously in possession or independently developed
by Investor, (ii) information publicly available other than as a result of breach of this provision
(iii) information required to be disclosed by statute, regulation or court or administrative order.
2.4 Visitation Rights. One representative chosen collectively by LB I Group Inc.,
Xxxxxx Brothers P.A. LLC, Xxxxxx Brothers Partnership Account 2000/2001, L.P. and Xxxxxx Brothers
Offshore Partnership Account 2000/2001, L.P. (collectively, “Xxxxxx”), one representative chosen
collectively by EuclidSR Partners, L.P. and EuclidSR Biotechnology Partners, L.P. (collectively,
“EuclidSR”), one representative chosen by Xxxxx Xxxxxxx Healthcare Fund III, L.P. (“Xxxxx
Xxxxxxx”), one representative chosen by GE Capital Equity Investments, Inc. (“GE Capital”), one
representative chosen collectively by Interwest Investors VII, L. P. and Interwest Partners VII,
L.P. (collectively, “Interwest”), one representative chosen by AllianceBernstein L.P. (“Alliance”),
and one representative chosen by BMSIF shall have the right to attend all meetings of the Board of
Directors, including meetings of any committee of the Board and including the right to participate
in any telephonic board meetings, so long as such Investor holds at least 750,000 shares
of Eligible Securities (as adjusted for stock splits and combinations and the like). Said
representative(s) shall be provided with notice of the meetings in the same manner at the same time
as the members of the Board of Directors and shall be provided with any materials distributed to
the Board of Directors in connection with board meetings. The foregoing visitation rights may be
limited by the Board of Directors if (i), upon the advice of counsel, the Board of Directors
determines that exclusion is required by third party confidentiality agreements, (ii) the Board is
discussing engaging Investor or an affiliate of Investor as a financial advisor or underwriter; or
(iii) the Board is discussing a material transaction with an entity in which Investor or a private
equity fund affiliated with Investor is a 5% or greater shareholder, or (iv) the Board determines
in good faith upon advice of counsel that limitations are required to maintain attorney-client
privilege.
2.6 Insurance. The Company shall, subject to the approval of the Board of Directors,
maintain such fire, casualty and general liability insurance with coverages and in amounts as shall
be determined by the Board of Directors. The Company agrees to maintain in full force and effect
directors and officers liability insurance with coverage in the aggregate amount of amount of $2
million covering all of its directors. The Company will maintain coverage for the Series C
Directors (as defined in the Voting Agreement) and the Series D Directors (as defined in the Voting
Agreement) under such directors and officers liability insurance at all times commencing upon the
Closing (as defined in the Purchase Agreement).
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2.7 Proprietary Information Agreements. Unless otherwise determined by the Board of
Directors, all future employees and consultants of the Company shall be required to execute and
deliver a proprietary information and invention assignment agreement.
2.8 Invention Assignments. The Company agrees to use commercially reasonable efforts
to obtain from each of the individual contributing inventors for each invention that forms any part
of any patent or patent application owned by or licensed to the Company, executed invention
assignments in favor of the Company or the appropriate third party licensor, as the case may be.
2.9 Key-Man Life Insurance. The Company shall obtain and maintain key-man life
insurance in such amount as is determined by the Company’s Board of Directors, on Xxxxx
Xxxxxxxxxxx. Such policy shall name the Company as loss payee and shall not be cancelable by the
Company without prior unanimous approval of the Board of Directors.
2.10 Compliance with Laws. The Company shall use its best efforts to comply with the
requirements of all applicable laws, rules, regulations and orders of any governmental authority,
where noncompliance would have a material adverse effect on the Company’s business and financial
condition.
2.11 Termination of Covenants. The covenants set forth in Section 2 shall terminate
on, and be of no further force or effect after, the closing of the Company’s Initial Public
Offering. The rights granted pursuant to this Section 2 are not transferable other than to
Affiliates of Holders.
SECTION 3
3.1 Right of First Offer. Subject to the terms and conditions specified in this
Section 3, the Company hereby grants to each Investor a right of first offer with respect to future
sales by the Company of its Securities. An Investor shall be entitled to apportion the right of
first offer hereby granted among itself and its partners and Affiliates in such proportions as it
deems appropriate.
Each time the Company proposes to offer any Securities in a Financing (as defined below), the
Company shall first make an offering of such Securities to each Investor in accordance with the
following provisions:
(a) The Company shall deliver a notice (“Notice”) to each Investor stating (i) its intention
to offer such Securities for sale, (ii) the number of such Securities to be offered (the “Offered
Securities”), (iii) the price, if any, for which it proposes to offer such Securities, (iv) the
terms of such offer and (v) the Offer Amount (as defined below).
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(b) Within fifteen (15) calendar days after receipt of the Notice, each Investor may elect to
purchase, at the price and on the terms specified in the Notice, such Securities in an amount up to
the Offer Amount by providing the Company with written notice of its election.
(c) An election by an Investor pursuant to Section 3.1(b) to purchase Offered Securities shall
not be considered a binding commitment on the Investor unless and until the Company receives
binding commitments to purchase on the terms and conditions contained in the Notice substantially
all of the Offered Securities which the Investors have not elected to purchase.
Notwithstanding the foregoing, the Company and each of the Investors acknowledge and agree
that Lighthouse shall have the opportunity to invest not less than $250,000 in connection with the
first Financing completed after the date of this Agreement that involves the sale and issuance by
the Company of shares of the Company’s convertible preferred stock with aggregate gross proceeds to
the Company of at least $3 million. In the event that Lighthouse’s right to purchase Offered
Securities as otherwise set forth in this Section 3.1 would not permit such $250,000 investment,
then each of the Investors agrees that its respective right to purchase Offered Securities pursuant
to this Section 3.1 may be cut-back (proportionately with all other Investors based on the number
of shares of Eligible Securities held by the Investors) in such amounts as may be necessary to
permit the exercise of Lighthouse’s rights as set forth herein.
3.3 Offer Amount. The “Offer Amount” shall equal that percentage of the Offered
Securities equal to the number of shares of Eligible Securities held by an Investor which are
Registrable Securities divided by the total number of outstanding shares of Common Stock of the
Company. For the purposes of the foregoing calculations, all outstanding options and warrants
shall be deemed to be exercised and all Preferred Stock shall be deemed to have been converted into
Common Stock at the prevailing conversion rate.
3.4 Financing. “Financing” shall mean an offering or series of related offerings of
Securities by the Company for purposes of raising working capital in a minimum amount of $250,000.
Financing shall not include (i) the issuance or sale of shares of Common Stock or options to
purchase Common stock to employees, officers, directors or consultants for the primary purpose of
soliciting or retaining their services in such amount as shall have been approved by the Board of
Directors, (ii) the issuance or sale of Securities to leasing entities or financial institutions in
connection with commercial leasing or borrowing transactions approved by the Board of Directors,
(iii) the issuance or sale of Securities to third party providers of goods or services in
connection with transactions approved by the Board of Directors; (iv) the sale of Securities in a
registered public offering, (v) any issuances of Securities in connection with any stock split,
stock dividend or recapitalization by the Company, (vi) the issuance of Securities at a price (on
an as converted to
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Common Stock basis) below the original issue price of the Company’s Series E
Preferred Stock (as adjusted for stock splits, recapitalizations and like events) in connection
with sponsored research, collaboration, technology license, development, OEM, marketing or other
similar agreements or any joint venture or strategic alliance, if such issuance is approved
unanimously by the Board of Directors, provided that the issuance of the Company’s
Series E Preferred Stock to BMSIF or any Affiliate thereof or any related entity to the Singapore
Economic Development Board pursuant to Section 3.4(xii) below at a price below the original issue
price of the Company’s Series E Preferred Stock (as adjusted for stock splits, recapitalizations
and like events) shall also not be a Financing hereunder, (vii) the issuance of Securities at a
price (on an as converted to Common Stock basis) at or above the original issue price of the
Company’s Series E Preferred Stock (as adjusted for stock splits, recapitalizations and like
events) in connection with sponsored research, collaboration, technology license, development, OEM,
marketing or other similar agreements or any joint venture or strategic alliance, if such issuance
is approved by the Board of Directors, (viii) the issuance of Securities at a price (on an as
converted to Common Stock basis) below the original issue price of the Company’s Series E Preferred
Stock (as adjusted for stock splits, recapitalizations and like events) in connection with the
acquisition of another corporation by the Company by merger, consolidation, or purchase of all or
substantially all of the assets or shares of such corporation unanimously approved by the Board of
Directors, (ix) the issuance of Securities at a price (on an as
converted to Common Stock basis) at or above the original issue price of the Company’s Series
E Preferred Stock (as adjusted for stock splits, recapitalizations and like events) in connection
with the acquisition of another corporation by the Company by merger, consolidation, or purchase of
all or substantially all of the assets or shares of such corporation approved by the Board of
Directors; (x) shares of Series E Preferred Stock issued pursuant to the terms of the Purchase
Agreement; (xi) interest-bearing convertible promissory notes in the aggregate principal amount of
$8 million issued or issuable pursuant to the CNPA and/or the CNA and any Securities issued on
conversion thereof; and (xii) additional interest-bearing convertible promissory notes to be issued
after the date hereof in the aggregate principal amount of up to $15 million to BMSIF or any
Affiliate thereof or any related entity to the Singapore Economic Development Board, and any
Securities issued on conversion thereof.
3.5 Termination of Right of First Offer. The right of first offer contained in this
section shall not apply to and shall terminate upon the closing of an Initial Public Offering. The
right of first offer granted under this Section 3 is transferable to transferees of at least
750,000 shares of Registrable Securities (as adjusted for stock splits, combinations and the like)
or to Affiliates.
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SECTION 4
4.1 Notice of Sales. Should a Founder (a “Seller”) propose to accept one or more bona
fide offers (collectively, the “Purchase Offer”) from any persons (“Purchasers”) to purchase
Founders Shares from such Seller (other than as set forth 4.2(d) hereof), then such Seller shall,
promptly after exercise or termination of any rights of first refusal held by the Company, deliver
a notice (the “Notice”) to the Company and all Investors holding more than 750,000 shares of
Eligible Securities (“Eligible Investors”).
4.2 Purchase Right. Each Eligible Investor shall have the right, exercisable upon
written notice to such Seller within ten (10) business days after receipt of the Notice, to
purchase Founders Shares on the terms and conditions specified in the Purchase Offer. To the
extent an Eligible Investor exercises its right to purchase such shares in accordance with the
terms and conditions set forth below, the number of shares of stock which such Seller may sell to
the Purchasers pursuant to the Purchase Offer shall be correspondingly reduced. The purchase right
of each Eligible Investor shall be subject to the following terms and conditions:
(i) Any transfer to a revocable grantor trust with respect to which the Founder and members of
his family are the sole beneficiaries;
(ii) Any repurchase of Founders Shares by the Company;
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(iii) Any exercise by the Company of a right or remedy under the terms of any loan, security
or stock pledge agreement where the Founders Shares serve as security for a loan made by the
Company;
(iv) Any transfer to any ancestors or descendants or spouse of a Founder or to a trustee for
their benefit or to a custodian for the benefit of a Founders’ issue; or
(v) Any bona fide gift;
provided, however, that such Founder shall inform the Eligible Investors of such transfer or gift
(other than a transfer pursuant to clause (ii) or (iii)) prior to effecting it and the transferee
or donee (if other than the Company) shall furnish the Company and the Eligible Investors with a
written agreement to be bound by and comply with all applicable provisions of this Agreement.
4.4 Termination and Transfer. The restrictions imposed and rights granted by this
Section 4 shall not apply to and shall terminate immediately prior to the closing of the Company’s
Initial Public Offering. Securities received pursuant to any stock dividend, stock split,
recapitalization, or exercise of a conversion right shall be subject to this Section 4 to the
same extent as the shares of the Company with respect to which they were issued. The right of
first offer granted under this Section 4 is transferable to transferees of at least 750,000 shares
of Registrable Securities (as adjusted for stock splits, combinations and the like) or to
Affiliates.
4.5 Prohibited Transfer. Any attempt by a Founder to transfer Founders Shares in
violation of Section 4 hereof shall be void and the Company agrees it will not effect such a
transfer nor will it treat any alleged transferee(s) as the holder of such shares, without the
written consent of two-thirds (2/3) in interest of the Eligible Investors.
SECTION 5
5.1 Notice of Sales. Should a Founder (a “Seller”) propose to accept one or more bona
fide offers (collectively, the “Purchase Offer”) from any persons (“Purchasers”) to purchase
Founders Shares from such Seller (other than as set forth 5.2(d)), then such Seller shall, promptly
after exercise or termination of any rights of first refusal held by the Company or the Eligible
Investors, deliver a notice (the “Notice”) to the Company and all Eligible Investors describing the
terms and conditions of the Purchase Offer.
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5.2 Participation Right. Each Eligible Investor shall have the right, exercisable
upon written notice to such Seller within fifteen (15) business days after receipt of the Notice,
to participate in such Seller’s sale of stock pursuant to the specified terms and conditions of
such Purchase Offer. To the extent an Eligible Investor exercises such right of participation in
accordance with the terms and conditions set forth below, the number of shares of stock which such
Seller may sell pursuant to such Purchase Offer shall be correspondingly reduced. The right of
participation of each Eligible Investor shall be subject to the following terms and conditions:
(i) Any transfer to a revocable grantor trust with respect to which the Seller and members of
his family are the sole beneficiaries;
(ii) Any repurchase of Founders Shares by the Company;
(iii) Any exercise by the Company of a right or remedy under the terms of any loan, security
or stock pledge agreement where the Founders Shares serve as security for a loan made by the
Company;
(iv) Any transfer to any ancestors or descendants or spouse of a Founder or to a trustee for
their benefit or to a custodian for the benefit of a Founders’ issue; or
(v) Any bona fide gift;
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provided, however, that such Founder shall inform the Eligible Investors of such transfer or gift
(other than a transfer pursuant to clause (ii) or (iii)) prior to effecting it and the transferee
or donee (if other than the Company) shall furnish the Company and the Eligible Investors with a
written agreement to be bound by and comply with all applicable provisions of this Agreement.
5.4 Termination and Transfer. The restrictions imposed and rights granted by this
Section 5 shall not apply to and shall terminate immediately prior to the closing of the Company’s
Initial Public Offering. Securities received pursuant to any stock dividend, stock split,
recapitalization, or exercise of a conversion right shall be subject to this Section 5 to the same
extent as the shares of the Company with respect to which they were issued. The co-sale right
granted under this Section 5 is transferable to transferees of at least 750,000 shares of
Registrable Securities (as adjusted for stock splits, combinations and the like) or to Affiliates.
5.5 Prohibited Transfers.
(a) In the event any Founder should sell any Founders Shares in contravention of the co-sale
rights of the Investors under Section 5 (a “Prohibited Transfer”), the Investors, in addition to
such other remedies as may be available at law, in equity or hereunder, shall have the put option
provided below, and the Founder shall be bound by the applicable provisions of such option.
(b) In the event of a Prohibited Transfer, each Eligible Investor shall have the right to sell
to the Founder the type and number of shares of Common Stock equal to the number of shares that
such Eligible Investor would have been entitled to transfer to the third-party transferee(s) under
Section 5.2 hereof had the Prohibited Transfer been effected pursuant to and in compliance with the
terms thereof. Such sale shall be made on the following terms and conditions:
(i) The price per share at which the shares are to be sold to the Founder shall be equal to
the price per share paid by the third-party transferee(s) to the Founder in the Prohibited
Transfer. Such price per share shall be paid to the Eligible Investor in cash if the Founder
received cash for his shares. If the Founder did not receive cash but received other property
instead, the price per share to be paid to the Eligible Investor shall be paid (A) in the form of
the property received by the Founder for his shares, or (B) in cash equal to the fair market value
of the property received by such Founder as determined in good faith by the Company’s Board of
Directors, at the option of the Eligible Investor. The Founder shall also reimburse each Eligible
Investor for any and all fees and expense, including legal fees and expenses, incurred pursuant to
the exercise or the attempted exercise of the Eligible Investor’s rights under Section 5.
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(ii) Within thirty (30) days after the later of the dates on which the Eligible Investor (A)
received notice of the Prohibited Transfer or (B) otherwise became aware of the Prohibited
Transfer, each Eligible Investor shall, if exercising the option created hereby, deliver to the
Founder the certificate or certificates representing shares to be sold, each certificate to be
properly endorsed for transfer.
(iii) The Founder shall, upon receipt of the certificate or certificates for the shares to be
sold by an Eligible Investor pursuant to this Section 5, pay the aggregate purchase price therefor
and the amount of reimbursable fees and expenses, as specified in subparagraph 5.5(b)(i), in cash
or by other means acceptable to the Eligible Investor.
(c) Notwithstanding the foregoing, any attempt by a Founder to transfer Founders Shares in
violation of Section 5 hereof shall be void and the Company agrees it will not effect such a
transfer nor will it treat any alleged transferee(s) as the holder of such shares, without the
written consent of two-thirds (2/3) in interest of the Eligible Investors.
SECTION 6
The parties hereto agree to submit to the jurisdiction of the federal and state courts of San
Mateo County, California with respect to the breach or interpretation of this Agreement or the
enforcement of any and all rights, duties, liabilities, obligations, powers, and other relations
between the parties arising under this Agreement.
6.2 Successors and Assigns. Except as otherwise provided herein, the provisions
hereof shall inure to the benefit of, and be binding upon, the successors, assigns, heirs,
executors and administrators of the parties hereto.
6.3 Notices, Etc. All notices and other communications required or permitted
hereunder, shall be in writing and shall be sent by facsimile personally delivered, mailed by
registered or certified mail, postage prepaid, return receipt requested, or otherwise delivered by
a nationally-recognized overnight courier, addressed (a) if to an Investor, at Investor’s facsimile
number or address as set forth in the records of the Company or (b) if to any other holder of any
Eligible Securities, at such address as such holder shall have furnished the Company in writing,
or, until any such holder so furnishes an address to the Company, then to and at the address of the
last holder of such Eligible Securities who has so furnished an address or facsimile number to the
Company, or (c) if to a Founder, at such Founder’s facsimile number or address set forth on
EXHIBIT B hereto, or a such other address as such Founder shall have furnished to the
Company in writing, or (d) if to the Company, at its facsimile number or address set forth on the
signature page hereto addressed to the attention of the Corporate Secretary, or at such other
address as the Company
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shall have furnished to the Investors. Any such notice or communication
shall be deemed to have been received (A) in the case of personal delivery, on the date of such
delivery, (B) in the case of a nationally-recognized overnight courier, on the next business day
after the date when sent, (C) in the case of mailing, on the third business day following that on
which the piece of mail containing such communication is posted and (D) in the case of delivery via
facsimile, one (1) business day after the date of transmission provided that said transmission is
confirmed telephonically on the date of transmission.
6.4 Delays or Omissions. No delay or omission to exercise any right, power or remedy
accruing to any holder of any Eligible Securities upon any breach or default of the Company under
this Agreement shall impair any such right, power or remedy of such holder, 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 theretofore or thereafter occurring. Any
waiver, permit, consent or approval of any kind or character on the part of any holder of any
breach or default under this Agreement, or any waiver on the part of any holder 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 or as provided in this Agreement. All remedies, either under this Agreement or
by law or otherwise afforded to any holder, shall be cumulative and not alternative.
6.5 Third Parties. Nothing in this Agreement, express or implied, is intended to
confer upon any party, other than the parties hereto, and their respective successors and assigns,
any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as
expressly provided herein.
6.6 Severability. If one or more provisions of this Agreement are held to be
unenforceable under applicable law, portions of such provisions, or such provisions in their
entirety, to the extent necessary, shall be severed from this Agreement, and the balance of this
Agreement shall be enforceable in accordance with its terms.
6.7 Amendment and Waiver. Any provision of this Agreement may be amended or waived
with the written consent of the Company and the Holders of at least two-thirds of the outstanding
shares of the Registrable Securities then held by Holders (assuming the exercise or conversion of
all outstanding Eligible Securities); provided, however, (i) that in the event such
amendment or waiver adversely affects the rights and/or obligations of the Founders under this
Agreement in a different manner than the other Holders, such amendment or waiver shall also require
written consent of the Founders holding a majority of the then outstanding Founders Shares, (ii)
that in the event such amendment or waiver adversely affects the rights and/or obligations of
Lehman, EuclidSR, Xxxxx Xxxxxxx, GE Capital, Interwest, Alliance, and BMSIF under Section 2.4 of
this Agreement, such amendment or waiver shall not be effective as to Lehman, EuclidSR, Xxxxx
Xxxxxxx, GE Capital, Interwest or BMSIF, as the case may be, without the written consent of such
party, and (iii) that in the event such amendment or waiver adversely affects the rights and/or
obligations of Warrantholders under this Agreement in a different manner than the other Holders,
such amendment or waiver shall also require the written consent of Warrantholders holding a
-27-
majority of the then outstanding Warrant Shares. Notwithstanding the foregoing, any purchaser of
Series E Preferred Stock pursuant to the Purchase Agreement may become a party to this Agreement by
executing and delivering an additional counterpart signature page to this Agreement and such
purchaser shall be deemed a Holder and an Investor hereunder. The parties agree that Exhibit
A shall be updated automatically without any formal amendment to reflect the addition of any
such additional party. Any amendment or waiver effected in accordance with this paragraph shall be
binding upon each Holder, the Founders, the holder of the Other Shares, Warrantholders and the
Company. In addition, the Company may waive performance of any obligation owing to it, as to some
or all of the Holders, or agree to accept alternatives to such performance, without obtaining the
consent of any other Holder. In the event that an underwriting agreement is entered into between
the Company and any Holder, and such underwriting agreement contains terms differing from this
Agreement, as to any such Holder the terms of such underwriting agreement shall govern.
6.8 Rights of Holders. Each Holder shall have the absolute right to exercise or
refrain from exercising any right or rights that such holder may have by reason of this Agreement,
including, without limitation, the right to consent to the waiver or modification of any obligation
under this Agreement, and such holder shall not incur any liability to any other holder of any
Securities as a result of exercising or refraining from exercising any such right or rights.
6.9 Counterparts. This Agreement may be executed in any number of counterparts, each
of which shall be enforceable against the parties actually executing such counterparts, and all of
which together shall constitute one instrument.
6.10 Titles and Subtitles. The titles of the paragraphs and subparagraphs of this
Agreement are for convenience of reference only and are not to be considered in construing this
Agreement.
6.11 Amendment and Restatement of Prior Agreement. The undersigned Prior Investors
who in the aggregate hold at least two-thirds of the outstanding Registrable Securities (as defined
in the Prior Agreement) and the undersigned Founders hereby amend and restate the Prior Agreement
pursuant to Section 6.7 thereof.
6.12 Waiver of Right of First Offer. The undersigned Prior Investors who in the
aggregate hold at least two-thirds of the outstanding Registrable Securities (as defined in the
Prior Agreement) hereby waive on behalf of all Prior Investors any rights of participation or
notice under Section 3 of this Agreement and the Prior Agreement with respect to the securities
sold pursuant to the Purchase Agreement. By its execution below, Lighthouse waives any right of
participation or notice under Section 3 of this Agreement and Section 3 of the Prior Agreement with
respect to securities sold under the Purchase Agreement.
6.13 Aggregation of Stock. All shares of Eligible Securities held or acquired by
Affiliated entities or persons shall be aggregated together for the purpose of determining the
availability of any rights under this Agreement.
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6.14 Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING (WHETHER
SOUNDING IN CONTRACT, TORT OR OTHERWISE) ARISING OUT OF OR RELATED TO THIS AGREEMENT.
[Remainder
of Page Left Blank Intentionally]
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THIS AMENDMENT NO. 1 (this “Amendment”) to that certain Eighth Amended and Restated Investor
Rights Agreement, dated as of June 13, 2006 (the “Rights Agreement”), by and among Fluidigm
Corporation, a California corporation (the “Company”), and the Investors and Founders named therein
is entered into this 22nd day of December, 2006 by and among the Company and the undersigned,
collectively the Holders of at least two-thirds of the outstanding shares of the Registrable
Securities then held by Holders (assuming the exercise or conversion of all outstanding Eligible
Securities). Capitalized terms not defined herein have the meanings set forth in the Rights
Agreement.
A. It is contemplated that the Company will sell and issue additional shares of the Company’s
Series E Preferred Stock (“Series E Preferred Stock”) pursuant to that certain Series E Preferred
Stock Purchase Agreement, dated as of June 13, 2006 (the “Purchase Agreement”), by and among the
Company and the Purchasers named therein.
B. In connection with the sale of additional shares of Series E Preferred Stock, the Company
and the Investors desire to (i) provide that the standoff agreement in Section 1.14 of the Rights
Agreement shall not apply to securities of the Company purchased by certain Holders in the Initial
Public Offering or in the public market for the Company’s securities following the Initial Public
Offering, and (ii) grant visitation rights pursuant to Section 2.4 of the Rights Agreement
collectively to Cross Creek Capital, L.P., Cross Creek Capital Employees’ Fund, L.P. and Wasatch
Small Cap Growth.
C. The Company and the undersigned Holders of at least two-thirds of the outstanding shares of
the Registrable Securities then held by Holders (assuming the exercise or conversion of all
outstanding Eligible Securities) have agreed to amend the Rights Agreement to provide for the
foregoing changes to the standoff agreement in Section 1.14 and the visitation rights in Section
2.4.
SECTION 7 Amendment to Section 1.14. Section 1.14 (Standoff Agreement) of the Rights
Agreement is hereby amended and restated in its entirety as follows:
(a) Each Holder agrees in connection with the first sale of the Company’s
Common Stock in a firm commitment underwritten public offering pursuant to an
effective registration statement under the Securities Act, upon notice by the
Company or the underwriters managing such public offering, not to sell, make any
short sale of, loan, pledge (or otherwise encumber or hypothecate), grant any option
for the purchase of, or otherwise directly or indirectly dispose of any Securities
(other than those included in the registration) without the prior written consent of
the Company and such managing underwriters for such period of time as the Board of
Directors establishes pursuant to its good faith negotiations with such managing
underwriters; provided, however that:
(i) such agreement shall not exceed one hundred eighty (180) days;
(ii) such agreement shall not apply to transfers to an Affiliate, provided that
such Affiliate agrees to be bound by the terms of such agreement, to the same extent
as if such transferee were the original party thereunder;
(iii) such agreement shall not apply to securities of the Company purchased by
AllianceBernstein Venture Fund I, L.P., SmallCap World Fund, Inc., Cross Creek
Capital, L.P., Cross Creek Capital Employees’ Fund, L.P. or Wasatch Small Cap Growth
or their respective Affiliates in the Initial Public Offering or in the public
market for the Company’s securities following the Initial Public Offering;
(iv) a Holder shall not be subject to such agreement unless (A) all executive
officers and directors of the Company, (B), all shareholders of the Company holding
more than 1% of the Company’s outstanding capital stock; and (C) all other Holders
and holders of other registration rights, are subject to or obligated to enter into
similar agreements; and
(v) if and when any person identified in clause (iv) is released, in whole or
in part, from such agreement (whether or not such release is contemplated at the
time of the offering) or if any such agreement is terminated, the Holder shall be
concurrently released on a pro rata basis based on the number of shares held by such
person and the Holder.
(b) Each Holder agrees that prior to the Initial Public Offering it will not
transfer securities of the Company unless each transferee agrees in writing to be
bound by all of the provisions of this Section 1.14; provided that this Section
1.14(b) shall not apply to transfers pursuant to a registration statement.
(c) Each Holder hereby consents to the placement of stop transfer orders with
the Company’s transfer agent in order to enforce the foregoing provision and agrees
to execute a market standoff agreement with said
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underwriters in customary form consistent with the provisions of this Section 1.14.
SECTION 8 Amendment to Section 2.4. Section 2.4 (Visitation Rights) of the Rights
Agreement is hereby amended and restated in its entirety as follows:
“2.4 Visitation Rights. One representative chosen collectively by LB I Group
Inc., Xxxxxx Brothers P.A. LLC, Xxxxxx Brothers Partnership Account 2000/2001, L.P. and
Xxxxxx Brothers Offshore Partnership Account 2000/2001, L.P. (collectively, “Xxxxxx”), one
representative chosen collectively by EuclidSR Partners, L.P. and EuclidSR Biotechnology
Partners, L.P. (collectively, “EuclidSR”), one representative chosen by Xxxxx Xxxxxxx
Healthcare Fund III, L.P. (“Xxxxx Xxxxxxx”), one representative chosen by GE Capital Equity
Investments, Inc. (“GE Capital”), one representative chosen collectively by Interwest
Investors VII, L. P. and Interwest Partners VII, L.P. (collectively, “Interwest”), one
representative chosen by AllianceBernstein Venture Fund I, L.P. (“Alliance”), one
representative chosen collectively by Cross Creek Capital, L.P., Cross Creek Capital
Employees’ Fund, L.P. and Wasatch Small Cap Growth (collectively, “Wasatch”), and one
representative chosen by BMSIF shall have the right to attend all meetings of the Board of
Directors, including meetings of any committee of the Board and including the right to
participate in any telephonic board meetings, so long as such Investor holds at least
750,000 shares of Eligible Securities (as adjusted for stock splits and combinations and the
like). Said representative(s) shall be provided with notice of the meetings in the same
manner at the same time as the members of the Board of Directors and shall be provided with
any materials distributed to the Board of Directors in connection with board meetings. The
foregoing visitation rights may be limited by the Board of Directors if (i), upon the advice
of counsel, the Board of Directors determines that exclusion is required by third party
confidentiality agreements, (ii) the Board is discussing engaging Investor or an affiliate
of Investor as a financial advisor or underwriter; or (iii) the Board is discussing a
material transaction with an entity in which Investor or a private equity fund affiliated
with Investor is a 5% or greater shareholder, or (iv) the Board determines in good faith
upon advice of counsel that limitations are required to maintain attorney-client privilege.”
SECTION 9 Amendment to Section 6.7. Section 6.7 (Amendment and Waiver) of the Rights
Agreement is hereby amended and restated in its entirety as follows:
“6.7 Amendment and Waiver. Any provision of this Agreement may be amended
or waived with the written consent of the Company and the Holders of at least
two-thirds of the outstanding shares of the Registrable Securities then held by
Holders (assuming the exercise or conversion of all outstanding Eligible
Securities); provided, however, (i) that in the event such amendment
or waiver adversely affects the rights and/or obligations of the Founders under this
Agreement in a different manner than the other Holders, such amendment or waiver
shall also require written consent of the Founders holding a majority of the
-3-
then outstanding Founders Shares, (ii) that in the event such amendment or waiver
adversely affects the rights and/or obligations of Lehman, EuclidSR, Xxxxx Xxxxxxx,
GE Capital, Interwest, Alliance, Wasatch or BMSIF under Section 2.4 of this
Agreement, such amendment or waiver shall not be effective as to Lehman, EuclidSR,
Xxxxx Xxxxxxx, GE Capital, Interwest, Alliance, Wasatch or BMSIF, as the case may
be, without the written consent of such party, and (iii) that in the event such
amendment or waiver adversely affects the rights and/or obligations of
Warrantholders under this Agreement in a different manner than the other Holders,
such amendment or waiver shall also require the written consent of Warrantholders
holding a majority of the then outstanding Warrant Shares. Notwithstanding the
foregoing, any purchaser of Series E Preferred Stock pursuant to the Purchase
Agreement may become a party to this Agreement by executing and delivering an
additional counterpart signature page to this Agreement and such purchaser shall be
deemed a Holder and an Investor hereunder. The parties agree that Exhibit A
shall be updated automatically without any formal amendment to reflect the addition
of any such additional party. Any amendment or waiver effected in accordance with
this paragraph shall be binding upon each Holder, the Founders, the holder of the
Other Shares, Warrantholders and the Company. In addition, the Company may waive
performance of any obligation owing to it, as to some or all of the Holders, or
agree to accept alternatives to such performance, without obtaining the consent of
any other Holder. In the event that an underwriting agreement is entered into
between the Company and any Holder, and such underwriting agreement contains terms
differing from this Agreement, as to any such Holder the terms of such underwriting
agreement shall govern.”
SECTION 10 Governing Law. This Amendment shall be construed in accordance with, and
governed in all respects by, the laws of the State of California, as applied to agreements entered
into, and to be performed entirely in such state, between residents of such state.
SECTION 11 Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually executing such
counterparts, and all of which together shall constitute one instrument.
[Remainder of Page Intentionally Blank]
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FLUIDIGM CORPORATION
AMENDMENT NO. 2 TO
EIGHTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
EIGHTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
THIS AMENDMENT NO. 2 (this “Amendment”) to that certain Eighth Amended and Restated Investor
Rights Agreement, dated as of June 13, 2006, as amended December 22, 2006 (the “Rights Agreement”),
by and among Fluidigm Corporation, a California corporation (“Fluidigm California”), and the
Investors and Founders named therein is entered into effective as of October 10, 2007 by and among
Fluidigm Corporation, a Delaware corporation (the “Company”), the undersigned Investors, and the
undersigned Holders, collectively the Holders of at least two-thirds of the outstanding shares of
the Registrable Securities held by Holders (assuming the exercise or conversion of all outstanding
Eligible Securities). Capitalized terms not defined herein have the meanings set forth in the
Rights Agreement.
WHEREAS, on July 18, 2007, Fluidigm California was merged with and into the Company, with the
Company being the surviving corporation such that the Company succeeded to all of Fluidigm
California’s rights and obligations under the Rights Agreement;
SECTION 12 Amendment to Recital. The first Recital of the Rights Agreement is hereby
amended and restated in its entirety as follows:
SECTION 13 Amendment to Section 1.14. Subsection (a)(i) of Section 1.14 (Standoff
Agreement) of the Rights Agreement is hereby amended and restated in its entirety as follows:
“(i) such agreement shall not exceed one hundred and eighty (180) days (or such greater
period, not to exceed 17 days, as may be requested by the Company or an underwriter to
accommodate regulatory restrictions on (i) the publication or other distribution of research
reports and (ii) analyst recommendations and opinions, including, but not limited to, the
restrictions contained in NASD Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor
provisions or amendments thereto);”
SECTION 14 Deletion of Section 1.15. The Rights Agreement is hereby amended to delete
Section 1.15 (No Right to Delay Registration) in its entirety.
SECTION 15 Amendment to Section 2.4. Section 2.4 (Visitation Rights) of the Rights
Agreement is hereby amended and restated in its entirety as follows:
“2.4 Visitation Rights. One representative chosen collectively by LB I Group
Inc., Xxxxxx Brothers P.A. LLC, Xxxxxx Brothers Partnership Account 2000/2001, L.P. and
Xxxxxx Brothers Offshore Partnership Account 2000/2001, L.P. (collectively, “Xxxxxx”), one
representative chosen collectively by EuclidSR Partners, L.P. and EuclidSR Biotechnology
Partners, L.P. (collectively, “EuclidSR”), one representative chosen by Xxxxx Xxxxxxx
Healthcare Fund III, L.P. (“Xxxxx Xxxxxxx”), one representative chosen by GE Capital Equity
Investments, Inc. (“GE Capital”), one representative chosen collectively by Interwest
Investors VII, L. P. and Interwest Partners VII, L.P. (collectively, “Interwest”), one
representative chosen by AllianceBernstein Venture Fund I, L.P. (“Alliance”), one
representative chosen collectively by Cross Creek Capital, L.P., Cross Creek Capital
Employees’ Fund, L.P. and Wasatch Small Cap Growth (collectively, “Wasatch”), one
representative chosen by BMSIF, and one representative chosen collectively by the holders of
a majority of the Shares purchased under Amendment No. 2 to the Purchase Agreement
(collectively, the “October 2007 Representative”) shall have the right to attend all
meetings of the Board of Directors, including meetings of any committee of the Board and
including the right to participate in any telephonic board meetings, so long as such
Investor or the October 2007 Representative holds at least
750,000 shares of Eligible Securities (as adjusted for stock
-2-
splits and combinations and the like). Said representative(s) shall be provided with
notice of the meetings in the same manner at the same time as the members of the Board of
Directors and shall be provided with any materials distributed to the Board of Directors in
connection with board meetings. The foregoing visitation rights may be limited by the Board
of Directors if (i), upon the advice of counsel, the Board of Directors determines that
exclusion is required by third party confidentiality agreements, (ii) the Board is
discussing engaging Investor or an affiliate of Investor as a financial advisor or
underwriter; or (iii) the Board is discussing a material transaction with an entity in which
Investor or a private equity fund affiliated with Investor is a 5% or greater shareholder,
or (iv) the Board determines in good faith upon advice of counsel that limitations are
required to maintain attorney-client privilege.”
SECTION 16 Amendment to Section 6.7. Section 6.7 (Amendment and Waiver) of the Rights
Agreement is hereby amended and restated in its entirety as follows:
“6.7 Amendment and Waiver. Any provision of this Agreement may be amended or
waived with the written consent of the Company and the Holders of at least two-thirds of the
outstanding shares of the Registrable Securities then held by Holders (assuming the exercise
or conversion of all outstanding Eligible Securities); provided, however,
(i) that in the event such amendment or waiver adversely affects the rights and/or
obligations of the Founders under this Agreement in a different manner than the other
Holders, such amendment or waiver shall also require written consent of the Founders holding
a majority of the then outstanding Founders Shares, (ii) that in the event such amendment or
waiver adversely affects the rights and/or obligations of Lehman, EuclidSR, Xxxxx Xxxxxxx,
GE Capital, Interwest, Alliance, Wasatch, BMSIF or the October 2007 Representative under
Section 2.4 of this Agreement, such amendment or waiver shall not be effective as to Lehman,
EuclidSR, Xxxxx Xxxxxxx, GE Capital, Interwest, Alliance, Wasatch, BMSIF or the October 2007
Representative, as the case may be, without the written consent of such party, and (iii)
that in the event such amendment or waiver adversely affects the rights and/or obligations
of Warrantholders under this Agreement in a different manner than the other Holders, such
amendment or waiver shall also require the written consent of Warrantholders holding a
majority of the then outstanding Warrant Shares. Notwithstanding the foregoing, any
purchaser of Series E Preferred Stock pursuant to the Purchase Agreement may become a party
to this Agreement by executing and delivering an additional counterpart signature page to
this Agreement and such purchaser shall be deemed a Holder and an Investor hereunder. The
parties agree that Exhibit A shall be updated automatically without any formal
amendment to reflect the addition of any such additional party. Any amendment or waiver
effected in accordance with this paragraph shall be binding upon each Holder, the Founders,
the holder of the Other Shares, Warrantholders and the Company. In addition, the Company
may waive performance of any obligation owing to it, as to some or all of the Holders, or
agree to accept alternatives to such performance, without obtaining the
consent of any other Holder. In the event that an underwriting agreement is entered
into between the Company and any Holder, and such underwriting agreement contains terms
-3-
differing from this Agreement, as to any such Holder the terms of such underwriting
agreement shall govern.”
“6.15 Reincorporation. Each Investor and Founder acknowledges that the Company
completed a reincorporation into the State of Delaware on July 18, 2007 and each Investor
and Founder hereby consents to the assignment of this Agreement to Fluidigm Corporation, a
Delaware corporation, effective as of July 18, 2007.”
SECTION 18 Governing Law. This Amendment shall be construed in accordance with, and
governed in all respects by, the laws of the State of California, as applied to agreements entered
into, and to be performed entirely in such state, between residents of such state.
SECTION 19 Rights Agreement. Wherever necessary, all other terms of the Rights
Agreement are hereby amended to be consistent with the terms of this Amendment. Except as
specifically set forth herein, the Rights Agreement shall remain in full force and effect
SECTION 20 Counterparts. This Amendment may be executed in any number of
counterparts, each of which shall be enforceable against the parties actually executing such
counterparts, and all of which together shall constitute one instrument.
SECTION 21 Effect of Execution of Amendment by Investor. This Amendment, when
executed and delivered by the Company and an Investor purchasing shares of Series E Preferred
pursuant to the Purchase Agreement as contemplated in the Recitals, shall also constitute and shall
be deemed a counterpart signature page to the Rights Agreement. Consequently, each undersigned
Investor purchasing shares of Series E Preferred acknowledges and agrees that he, she or it is
bound by the terms and conditions contained in the Rights Agreement, as amended by this Amendment.
[Remainder of Page Intentionally Blank]
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FOUNDERS
Xxxxx X. Xxxxxxxxxxx
Xxxxxxx X. Quake
INVESTORS
Xxxxxxxxx Xxxxxxxxxx, M.D.
Xxxxxx X. Xxxxxx
Xxxxx Xxxxxxx
Xxxxx May, Trustee, Intervivos Trust Dated 5/14/91
AllianceBernstein Venture Fund I, L.P.
Alloy Partners 2002, L.P.
Alloy Ventures 2002, L.P.
Alloy Ventures 2005, L.P.
Analiza, Inc.
Athersys, Inc.
Beveren Company
Biomedical Sciences Investment Fund Pte Ltd
Xxxxxxxx X. Xxxxxxx and Xxxxx X. Xxxxxxx As Trustees of the Xxxxxxx Family Trust U/A/D 7/30/97
Xxxxxxxx X. Xxxx
Xxxxx Xxxxxxx
Xxxx & Xxxxxx LLP
Burwen Family Trust U/D/T Dated 9/30/88
Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxxx
Xxxxx-Xxxx Family Trust
Cross Creek Capital Employees’ Fund, L.P.
Cross Creek Capital, L.P.
Xxxxxx Xxxxx
Xxxxxx X. XxXxxxx
Xxxxx Xxxxxxxxxx
Xxxx X. Xxxxxxxx, Trustee of the Elisabeth North Xxxxxxxx Xxxxxxxx Trust UTA dated January 17, 2001
Xxxx X. Xxxxxxxx, Trustee of the Xxxx X. Xxxxxxxx Trust UTD dated March 29, 2000
EuclidSR Biotechnology Partners, L.P.
EuclidSR Partners, X.X.
Xxxxxxxx/Xxxx Family Trust Dated 6/28/99
Fidelity Contrafund: Fidelity Advisor New Insights Fund
Fidelity Contrafund: Fidelity Contrafund
Finnegan, Henderson, Farabow, Garrett & Dunner, LLP
Xxxxxxx X. Xxxxxx
Xxxx St. Xxxx
Xxxxxxxx Xxxxx
Xxxx R. Bang
GE Capital Equity Investments, Inc.
General Electric Capital Corporation
Xxxxxx X. Xxxxxx
Glaxo Group Limited
Health Care Administration Company
Xxxxx Xxxxxxx
Xxxxx X. Xxxxxx, Xx. TTEE Xxxxxx Family Trust U/A DTD 7/06/88
Xxxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx
Xxxxxx X. Xxxxxxxx and Xxxxxx X. Xxxxxxxx, Ttees Xxxxxxxx Fam Tr UA DTD 5/26/94
In-Q-Tel Employee Fund, LLC
In-Q-Tel, Inc.
Interwest Investors VII, L.P.
Interwest Partners VII, L.P.
Invus, L.P.
J.F. Xxxx Co., Inc. As Nominee 1999-114
Jacaranda Partners
Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxx, M.D.
Xxxx X. Xxxxxxxx, Ph.D., M.D.
Xxxx Xxxx
Xxxx X. Xxxxxxx
Xxxxxxxx X. Xxxx and Xxxxxx X. Xxxx, Trustees of the Hoot Family Revocable Trust DTD 3/16/99
Xxxxxx X. Xxxxxxxx
Xxxxxxx X. Xxxxx
Xxxxx Revocable Trust
Xxxxxxx X. XxXxxxxxxx Trust
Leerink Xxxxx Co-Investment Fund, LLC
Leerink Xxxxx Holdings, LLC
Xxxxxx Brothers Healthcare Venture Capital X.X.
Xxxxxx Brothers Offshore Partnership Account 2000/2001, X.X.
Xxxxxx Brothers P.A. LLC
Xxxxxx Brothers Partnership Account 2000/2001, L.P.
Xxx X. Xxxxx, Xx. and Xxxxxxx X. Xxxxx TTEES Xxxxx Family Revocable Trust DTD 01/22/97
Lighthouse Capital Partners V, X.X.
Xxxxx Bio Ventures, Xxx Xxxxx and Company
Xxxxxxxx Partners
Xxxxxxx Xxxxxxx
Xxxxxxx Xxxxx
Xxxxxxx X. XxXxx
Xxxxxxx X. Xxxxxxx Trust Agreement dated June 5, 0000
Xxxxxx & Xxxxxxxxx XX
Xxxxxx Family Investment Partnership
Oculus Pharmaceuticals, Inc.
Xxxxxx East
Xxx and Xxxxx Xxxxxxx Revocable Trust
Xxxxxxx Xxxxxx
Xxxx Xxxxxx
Xxxxxxx van Ysendoorn
Xxxxx X. Xxxxxx
Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxx
Xxxxxx X. XxXxxxxxx and Xxxxxxxx X. XxXxxxxxx, Trustee, or their successor(s)
Xxxxxx X. Xxxxxxxx, Xx. Revocable Trust u/d/t dated May 27, 2004, Xxxxxx X. Xxxxxxxx, Xx., Trustee
Security Trust Co., Custodian FBO Xxxxx Xxxxxxxx XXX/RO
SightLine Healthcare Fund III, L.P.
Singapore Bio-Innovations Pte Ltd.
SMALLCAP World Fund, Inc.
SmithKline Xxxxxxx Corporation
Xxxxxxx X. Xxxxxx, and his successor(s), as the Trustee of the Xxxxxxx X. Xxxxxx Family Trust
Xxxxxxx X. Xxxxx
Xxxxxxx X. Xxxxx and Xxxxxx X. Xxxxx, Trustees of the Xxxxx Family 1996 Trust
Xxxxxxx X. Xxxxx
Technogen Liquidating Trust
The Xxxxxx Family Trust
The Xxxxxxxx Family Trust
The UAB Research Foundation
The V Foundation for Cancer Research
Xxxxxx X. Xxxxx
Xxxxxx X. Xxxxxx
Xxx X. Xxxxx Trust
Xxxxxxx X. Xxxxx
TTC Fund I, LLC
Variable Insurance Products Fund II: Contrafund Portfolio
Versant Affiliates Fund 1-A, L.P.
Versant Affiliates Fund 1-B, L.P.
Versant Side Fund I, L.P.
Versant Venture Capital I, L.P.
Wasatch Funds, Inc.
Xxxxxxx X. Xxxxx III, M.D.
Xxxxxxx X. Xxxxx Trust
Xxxxxxx X. Xxxxx and Xxxxxxx X. Xxxxx, or their successors, as Trustees of the Xxxxx FRT DTD
3/10/99
WS Investment Company 2000B
WS Investment Company 99B
WS Investment Company, LLC (2001D)