EX-10.3 11 d542432dex103.htm EX-10.3 Execution Version SIXTH AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT by and among NEURONETICS, INC. and THE STOCKHOLDERS LISTED HEREIN Dated as of June 1, 2017 Page -i- (continued) Page -ii- SIXTH AMENDED AND...
Exhibit 10.3
Execution Version
SIXTH AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT
by and among
NEURONETICS, INC.
and
THE STOCKHOLDERS LISTED HEREIN
Dated as of June 1, 2017
TABLE OF CONTENTS
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TABLE OF CONTENTS | ||||||||
1. | VOTING AGREEMENT | 3 | ||||||
1.1. | Agreement with Respect to Voting | 3 | ||||||
1.2. | Board of Directors | 3 | ||||||
1.3. | No “Bad Actor” Designees | 4 | ||||||
2. | RESTRICTIONS ON ISSUANCE AND TRANSFER OF SECURITIES | 5 | ||||||
2.1. | Certain Definitions | 5 | ||||||
2.2. | General | 8 | ||||||
2.3. | Prohibited Transfers Void | 8 | ||||||
3. | FIRST-REFUSAL AND CO-SALE RIGHTS AS TO STOCK TRANSFERS | 8 | ||||||
3.1. | Transfer Notice | 8 | ||||||
3.2. | Company’s and Preferred Stockholders’ Options | 8 | ||||||
4. | DRAG-ALONG RIGHT OF SECURITIES | 12 | ||||||
4.1. | Definitions Used in This Section | 12 | ||||||
4.2. | Actions to be Taken | 13 | ||||||
5. | PROCEDURES FOR INVOLUNTARY TRANSFERS | 17 | ||||||
5.1. | Transfers by Operation of Law | 17 | ||||||
5.2. | Determination of Fair Market Value | 18 | ||||||
6. | RESTRICTIVE LEGENDS | 18 | ||||||
7. | TERMINATION OF AGREEMENT | 18 | ||||||
8. | ADDITIONAL STOCKHOLDERS | 18 | ||||||
9. | “BAD ACTOR” MATTERS | 19 | ||||||
9.1. | Representation | 19 | ||||||
9.2. | Covenant | 19 | ||||||
10. | MISCELLANEOUS PROVISIONS | 19 | ||||||
10.1. | Amendments, Consents, Waivers, Etc. | 19 | ||||||
10.2. | Notices | 21 | ||||||
10.3. | Xxxxxx Xxxxxxxx Representation | 23 | ||||||
10.4. | Counterparts | 24 | ||||||
10.5. | Captions | 24 |
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TABLE OF CONTENTS
(continued)
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10.6. | Binding Effect and Benefits | 24 | ||||||
10.7. | Construction | 25 | ||||||
10.8. | Entire Agreement | 25 | ||||||
10.9. | Severability | 25 | ||||||
10.10. | Equitable Relief | 25 | ||||||
10.11. | Governing Law | 25 | ||||||
10.12. | Assignment of Rights | 25 | ||||||
10.13. | Jurisdiction | 26 | ||||||
11. | AGGREGATION OF STOCK | 26 | ||||||
12. | REMEDIES | 26 | ||||||
13. | OWNERSHIP | 26 | ||||||
14. | SPOUSAL CONSENT | 26 |
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SIXTH AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT
This Sixth Amended and Restated Stockholders’ Agreement (this “Agreement”), dated as of June 1, 2017, is by and among (i) Neuronetics, Inc., a Delaware corporation (the “Company”); (ii) the persons listed as owners of the Company’s Common Stock listed on the Schedule of Common Stockholders attached hereto (the “Common Stockholders”); (iii) the persons listed as owners of Series A-1 Preferred Stock, listed on the Schedule of Series A-1 Stockholders attached hereto (the “Series A-1 Holders”); (iv) the persons listed as owners of Series A-2 Preferred Stock, listed on the Schedule of A-2 Stockholders attached hereto (the “Series A-2 Holders”); (v) the persons listed as owners of Series B Preferred Stock, listed on the Schedule of Series B Stockholders attached hereto (the “Series B Holders”); (vi) the persons listed as owners of Series C Preferred Stock, listed on the Schedule of Series C Stockholders attached hereto (the “Series C Holders”); (vii) the persons listed as owners of Series D Preferred Stock, listed on the Schedule of Series D Stockholders attached hereto (the “Series D Holders”); (viii) the persons listed as owners of Series E Preferred Stock, listed on the Schedule of Series E Stockholders attached hereto (the “Series E Holders”); (ix) the persons listed as owners of Series F Preferred Stock, listed on the Schedule of Series F Stockholders attached hereto (the “Series F Holders”); (x) the persons listed as owners of Series G Preferred Stock, listed on the Schedule of Series G Stockholders attached hereto (the “Series G Holders”); (xi) the Key Officers listed on the Schedule of Key Officers attached hereto; and (xii) each person or entity that subsequently becomes a party to this Agreement by signing an Instrument of Adherence pursuant to Section 8 hereof (the “Additional Stockholders,” and, together with the Common Stockholders, Series A-1 Holders, Series A-2 Holders, Series B Holders, Series C Holders, Series D Holders, Series E Holders, Series F Holders, the Series G Holders and Key Officers, collectively, the “Stockholders”).
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1. | VOTING AGREEMENT. |
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In the event of termination of employment, resignation, death, removal or disqualification of the Company’s Chief Executive Officer, the Board of Directors shall appoint a new Chief Executive Officer (who may be, for avoidance of doubt, an interim chief executive officer). Upon such appointment, the Majority Holders shall nominate such new Chief Executive Officer as the CEO Director and if necessary, remove the former Chief Executive Officer as the CEO Director. Other than with respect to the CEO Director, the power to nominate a director pursuant to this Section 1.2 includes the exclusive power to recommend the removal of such director for any reason or no reason (subject to the bylaws of the Company as in effect from time to time and any requirements of applicable law). If any person or group specified in this Section 1.2 as having the right to nominate a director (a “Nominator”) gives written notice to the other Stockholders of a desire to remove a director nominated by the Nominator, the other Stockholders will vote all of their Shares in favor of removing that director. If for any reason any director nominated by a Nominator ceases to hold office, the Nominator will have the right to nominate another individual to fill the vacancy so created for the unexpired term of office of such former director, and the other Stockholders will vote all of their Shares in favor of electing the individual so nominated to fill such vacancy.
The Board of Directors shall continue to maintain an audit committee consisting of at least two (2) directors, and such committee shall be charged with the customary responsibilities of an audit committee. The Board of Directors shall continue to maintain a compensation committee consisting of at least three (3) directors, including the Series E Director, and such committee shall continue to be charged with the customary responsibilities of a compensation committee, including responsibility for approval of base salaries, incentive bonuses and grants of options, restricted stock awards and warrants for officers and other key employees of the Company.
There will not be any other committee (including, without limitation, any executive committee) of the Board of Directors unless such committee is specifically approved by the Board of Directors, including the Super Board Approval, and one (1) of the Series A-2 Directors, the Series B Director, the Series C Director, the Series D Director or the Series E Director is the Chairman of each such committee and each of the remaining members of the Board of Directors has the option to be a member of each such committee. Members of the Board of Directors who are not members of a particular committee shall have the right to attend any meeting of such committee.
1.3. No “Bad Actor” Designees. Each Person with the right to designate or participate in the designation of a director as specified above hereby represents and warrants to the Company that, to such Person’s knowledge, none of the “bad actor” disqualifying events described in Rule 506(d)(1)(i)-(viii) promulgated under the Securities Act of 1933, as amended (the “Securities Act”) (each, a “Disqualification Event”), is applicable to such Person’s initial designee named above except, if applicable, for a Disqualification Event as to which Rule 506(d)(2)(ii) or (iii) or (d)(3) is applicable. Any director designee to whom any Disqualification Event is applicable, except for a Disqualification Event as to which Rule 506(d)(2)(ii) or (iii) or (d)(3) is applicable, is hereinafter referred to as a “Disqualified Designee”. Each Person with the right to designate or participate in the designation of a director as specified above hereby covenants and agrees (A) not to designate or participate in the designation of any director designee who, to such Person’s knowledge, is a Disqualified Designee and (B) that in the event such Person becomes aware that
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any individual previously designated by any such Person is or has become a Disqualified Designee, such Person shall as promptly as practicable take such actions as are necessary to remove such Disqualified Designee from the Board and designate a replacement designee who is not a Disqualified Designee.
2. | RESTRICTIONS ON ISSUANCE AND TRANSFER OF SECURITIES. |
2.1. Certain Definitions. As used in this Agreement:
(a) “Affiliate Stockholder” of any Stockholder or permitted assignee means any general or limited partner or retired partner of any such person that is a partnership, any member or retired member of any such person that is a limited liability company, or any person or entity that, directly or indirectly, through one or more intermediaries, controls, or is controlled by, or is under common control with, such Stockholder or permitted assignee.
(b) “Acquisition” shall have the meaning assigned to such term in the Charter.
(c) “Change of Control” means a transaction or series of related transactions in which a person, or a group of related persons, acquires from stockholders of the Company shares representing more than fifty percent (50%) of the outstanding voting power of the Company.
(d) “Charter” means the Company’s Eighth Amended and Restated Certificate of Incorporation, as amended and in effect from time to time.
(e) “CHV” means CHV IV, L.P.
(f) “Common Stock” means the Common Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(g) “Derivative Securities” means (i) all shares of stock and other securities that are convertible into or exchangeable for shares of Common Stock, including shares of Preferred Stock, and (ii) all options, warrants and other rights to acquire shares of Common Stock or securities convertible into or exchangeable for shares of Common Stock.
(h) “Key Officer” shall mean the Chief Executive Officer and each Vice President (or higher level) who reports directly to the Chief Executive Officer of the Company, for so long as such officer is providing services to the Company as an officer, employee or consultant, and thereafter. The Key Officers on the date of this Agreement are listed on the Schedule of Key Officers attached hereto. For avoidance of doubt, once an individual is a Key Officer, such individual shall remain a “Key Officer” for purposes of this Agreement even if such individual ceases to provide services to the Company).
(i) “Majority Series A-2 Holders” means, collectively, the Stockholders holding at least a majority of the then-outstanding shares of Series A-2 Preferred Stock.
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(j) “Majority Series B Holders” means, collectively, the Stockholders holding at least a majority of the then-outstanding shares of Series B Preferred Stock.
(k) “Majority Series C Holders” means, collectively, the Stockholders holding at least a majority of the then-outstanding shares of Series C Preferred Stock.
(l) “Majority Series G Holders” means, collectively, the Stockholders holding at least a majority of the then-outstanding shares of Series G Preferred Stock.
(m) “One Percent Common Stockholder” means any Common Stockholder who holds issued and outstanding shares of Common Stock (whether acquired by exercise of options or otherwise) representing at least one percent (1.0%) of the issued and outstanding Common Stock of the Company (for purposes of this calculation, assuming the conversion and/or exercise of all then outstanding Derivative Securities). For avoidance of doubt, once a Common Stockholder is a One Percent Common Stockholder, such Common Stockholder shall remain a “One Percent Common Stockholder” for purposes of this Agreement even if the Company issues additional shares of capital stock (including any Derivative Securities).
(n) “Permitted Transferee(s)” means, with respect to any Restricted Holder, such Restricted Holder’s Family Members (as defined below) or any transferee by will, descent, distribution or gift. “Family Members” means, as applied to any individual, whether by blood or adoption, his or her spouse, his or her and his or her spouse’s lineal ancestors and descendants and their respective spouses, any trust created for the benefit of any such person(s), and each custodian of property of any such person(s), and/or the estate of any such person(s).
(o) “Person” (regardless of whether capitalized) means any natural person, entity or association, including any corporation, partnership, limited liability company, government (or agency or subdivision thereof), trust, joint venture or proprietorship.
(p) “Polaris” means Polaris Venture Partners V, L.P., Polaris Venture Partners Entrepreneurs’ Fund V, L.P., Polaris Venture Partners Special Founders’ Fund V, L.P. and Polaris Venture Partners Founders’ Fund V, L.P.
(q) “Preferred Stock” means the Series A-1 Preferred Stock, the Series A-2 Preferred Stock, the Series B Preferred Stock, the Series C Preferred Stock, the Series D Preferred Stock, the Series E Preferred Stock, the Series F Preferred Stock and the Series G Preferred Stock.
(r) “Preferred Stockholders” means the Stockholders holding Preferred Stock.
(s) “Qualified Public Offering” shall have the meaning assigned to such term in the Charter.
(t) “Required Series D Holders” means, collectively, the Stockholders holding at least sixty-five percent (65%) of the then-outstanding shares of Series D Preferred Stock.
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(u) “Required Series E Holders” means, collectively, the Stockholders holding at least sixty percent (60%) of the then-outstanding shares of Series E Preferred Stock.
(v) “Required Series F Holders” means, collectively, the Stockholders holding at least seventy-five percent (75%) of the then-outstanding shares of Series F Preferred Stock.
(w) “Required Series G Holders” means, collectively, the Stockholders holding at least fifty-five percent (55)% of the then-outstanding shares of Series G Preferred Stock.
(x) “Restricted Holder” means each of the Key Officers, the Common Stockholders and the Series A-1 Holders.
(y) “Series A-1 Preferred Stock” means the Series A-1 Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(z) “Series A-2 Preferred Stock” means the Series A-2 Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(aa) “Series B Preferred Stock” means the Series B Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(bb) “Series C Preferred Stock” means the Series C Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(cc) “Series D Preferred Stock” means the Series D Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(dd) “Series E Preferred Stock” means the Series E Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(ee) “Series F Preferred Stock” means the Series F Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(ff) “Series G Preferred Stock” means the Series G Convertible Preferred Stock, $0.01 par value per share, of the Company, the terms of which are as set forth in the Charter.
(gg) “Super Board Approval” shall have the meaning assigned to such term in the Charter.
(hh) “Transfer” (whether used as a noun or a verb) refers to any sale, pledge, assignment, encumbrance, gift or other disposition or transfer of shares of capital stock or other equity securities of the Company (as used in this Agreement, the terms “equity security” and “equity securities” include, without limitation, options, warrants and other rights to acquire shares of the Company’s capital stock, and securities and other instruments that are convertible into or exchangeable for shares of the Company’s capital stock, and/or any legal or beneficial interest in any of the foregoing), or any legal or beneficial interest therein, including any tender
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or transfer in connection with any merger, recapitalization, reclassification, or tender or exchange offer (for all or any part of the Company’s equity securities), whether or not the person making any such transfer votes for or against any transaction involving any such Transfer.
3. FIRST-REFUSAL AND CO-SALE RIGHTS AS TO STOCK TRANSFERS.
3.1. Transfer Notice. At least 30 days prior to any proposed Transfer (other than a Permitted Transfer) by a Restricted Holder, such Restricted Holder (the “Transferring Stockholder”) will give notice (the “Transfer Notice”) to the Company and each of the Preferred Stockholders in accordance with Section 10.2 hereof, setting forth (i) the number and class of equity securities proposed to be sold by the Transferring Stockholder (the “Offered Securities”), (ii) the anticipated date of the proposed Transfer (the “Transfer Date”) and the names and addresses of the proposed transferees, and (iii) the material terms of the proposed Transfer, including the cash and/or other consideration to be received in respect of such Transfer.
3.2. Company’s and Preferred Stockholders’ Options. Upon the giving of any Transfer Notice, then, subject to all of the provisions of this Section 3.2, the Company and the Preferred Stockholders will have certain rights and options, as follows:
(a) Rights of First Refusal. The Company and the Preferred Stockholders will have the option, but not the obligation, to purchase some or all of the Offered Securities on the same terms as are specified in the Transfer Notice, including any deferred payment terms; provided,
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that the Company and the Preferred Stockholders will have the right to substitute cash in the amount of the fair market value of any non-cash consideration proposed to be received from the proposed transferees. Within fifteen (15) days after the effective date of the Transfer Notice, the Company and each of the Preferred Stockholders will give written notice to the Transferring Stockholder stating whether he, she or it elects to exercise such option, and if so, how many of the Offered Securities he, she or it elects to purchase (the “Subscription Amount”). Failure by the Company or any Preferred Stockholder to give such notice within such time period will be deemed an election by him, her or it not to exercise his, her or its option. If the aggregate number of securities for which the Company and the Preferred Stockholders exercise such options exceeds the total number of Offered Securities, then the Company will be entitled to purchase all of the Offered Securities as to which it has exercised its option if such number does not exceed the total number of Offered Securities and otherwise will be entitled to purchase all of the Offered Securities, and each Preferred Stockholder who has exercised his, her or its option will be entitled to purchase a number of the remaining Offered Securities (the “Basic Amount”), if any, equal to the proportion that the number of shares of Common Stock held by such Preferred Stockholder bears to the number of shares of Common Stock held by all such Preferred Stockholders (for this purpose, including shares of Common Stock issuable upon exercise, conversion or exchange of shares of Preferred Stock and other Derivative Securities held by such Preferred Stockholder). If the total number of Offered Securities exceeds the aggregate number of securities for which the Company and the Preferred Stockholders exercise such options (such excess being referred to herein as the “Available Overallotment Amount”), then each Preferred Stockholder whose Subscription Amount exceeds such Preferred Stockholder’s Basic Amount (the difference between the Preferred Stockholder’s Subscription Amount and the Preferred Stockholder’s Basic Amount being referred to herein as such Preferred Stockholder’s “Overallotment Amount”) shall be entitled to purchase such Preferred Stockholder’s Overallotment Amount; provided, that should the Overallotment Amounts subscribed for exceed the Available Overallotment Amount, then each Preferred Stockholder’s Overallotment Amount shall be reduced such that the Available Overallotment Amount is allocated among such Preferred Stockholders pro rata, based on their respective Basic Amounts (but not in excess of their respective Overallotment Amounts), with any Available Overallotment Amount remaining after such reallocation being further re-allocated in the same manner until the entire Available Overallotment Amount has been so allocated. The closing of the purchase and sale of the Offered Securities will take place as soon as is reasonably practicable at such date (but in any event within ten (10) days after the expiration of the fifteen (15) day period referred to above) (or the next business day if such tenth (10th) day is not a business day), time and place as the Company and the Preferred Stockholders exercising their purchase options hereunder may reasonably determine. If the Company and the Preferred Stockholders do not elect to purchase some or all of the Offered Securities hereunder, then subject to the provisions of Section 3.2(b) hereof, the Transferring Stockholder will thereafter be free for a period of ninety (90) days after the date of the Transfer Notice to consummate, with respect to the Offered Securities not purchased, the Transfer described in the Transfer Notice to the transferee(s) specified therein, at the price and on the other terms set forth therein; provided, that such transferee(s) first executes and delivers to the Company a written agreement to be bound by all of the provisions of this Agreement applicable to Restricted Holders and naming the Company and the Preferred
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Stockholders as intended third-party beneficiaries of such agreement. If such Transfer is not consummated within such ninety (90) day period, however, the Transferring Stockholder will not Transfer any of the Offered Securities without again complying with all of the provisions of this Section 3.
(b) Co-Sale Rights. Upon receipt of a Transfer Notice, each of the Preferred Stockholders (other than any of them who elect to purchase any of the Offered Securities pursuant to Section 3.2(a) hereof), may elect to participate in the contemplated Transfer by delivering written notice to the Transferring Stockholder within fifteen (15) days after the effective date of such Transfer Notice. Each of the Preferred Stockholders so electing will be entitled to sell in the contemplated Transfer, at the same price and on the same terms as specified in the Transfer Notice, a number of shares of Common Stock equal to (and not less than) the product of (i) the quotient determined by dividing (A) the number of shares of Common Stock held by such Preferred Stockholder (for this purpose, including shares of Common Stock issuable upon exercise, conversion or exchange of shares of Preferred Stock and other Derivative Securities held by such Preferred Stockholder), by (B) the aggregate number of shares of Common Stock held by the Transferring Stockholder and all such Preferred Stockholders (for this purpose, including shares of Common Stock issuable upon exercise, conversion, or exchange of shares of Preferred Stock and other Derivative Securities held by the Transferring Stockholder and all such Preferred Stockholders), and (ii) after giving effect to Section 3.2(a), the remaining Offered Securities to be sold in the contemplated Transfer. The Transferring Stockholder will be entitled to sell in the contemplated Transfer the balance of the equity securities proposed to be so sold. The Transferring Stockholder will use his, her or its best efforts to obtain the agreement of the prospective transferee(s) to allow the participation of the Preferred Stockholders in any contemplated Transfer and will not Transfer any equity securities to such prospective transferee(s) unless (y) such prospective transferee(s) allows the participation of the Preferred Stockholders on the terms specified herein or (z) simultaneously with such sale, the Transferring Stockholder purchases all securities subject to the right of co-sale from such participating Preferred Stockholder(s) on the same terms and conditions (including the proposed purchase price) as set forth in the Transfer Notice; provided, however, if such sale constitutes a Change of Control, the portion of the aggregate consideration paid by the Transferring Stockholder to such participating Preferred Stockholder(s) shall be made in accordance with Section 3.2(c) below. Subject to the foregoing and to the provisions of Section 3.2(a) hereof, the Transferring Stockholder may, within ninety (90) days after the date of the Transfer Notice, transfer the Offered Securities (reduced by the number of equity securities with respect to which any of the Preferred Stockholders have elected to participate, if any) at a price and on terms specified in the Transfer Notice; provided, that such transferee(s) first executes and delivers to the Company a written agreement to be bound by all of the provisions of this Agreement applicable to Restricted Holders and naming the Company and the Preferred Stockholders as intended third-party beneficiaries of such agreement. If such Transfer is not consummated within such ninety (90) day period, however, the Transferring Stockholder will not transfer any of the Offered Securities that have not been purchased within such period without again complying with all of the provisions of this Section 3.
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The Preferred Stockholders shall effect their participation in the Transfer by (A) converting the shares of Preferred Stock to be sold to Common Stock, if necessary, immediately prior to the completion of such Transfer, and (B) delivering to the Transferring Stockholder, on or prior to the Transfer Date, for transfer to the prospective purchaser, one or more certificates, properly endorsed for transfer, which represent the number of shares of Common Stock that any such participating Preferred Stockholder elects to sell. In the event that such Preferred Stockholder elects to sell less than all of the shares represented by any stock certificate in accordance with the terms hereof, upon surrender of such certificate to the Company, the Company shall promptly issue to such Preferred Stockholder both a certificate representing that number of shares that such Preferred Stockholder elects to sell in such Transfer and a residual certificate representing the number of shares that will not be sold in such Transfer (the “Residual Certificate”). The stock certificate or certificates representing shares that the participating Preferred Stockholder elects to sell shall be transferred to the prospective purchaser in consummation of the sale of the Common Stock pursuant to the terms and conditions specified in the Transfer Notice and the Residual Certificate shall be returned to the participating Preferred Stockholder. Subject to Section 3.2(c) below, the Transferring Stockholder shall immediately upon receipt of the proceeds from the sale of the Common Stock held by the participating Preferred Stockholders remit to each such participating Preferred Stockholder that portion of the proceeds to which such participating Preferred Stockholder is entitled by reason of its participation in such sale.
(c) In the event that a proposed Transfer constitutes a Change of Control, the aggregate consideration from such transfer shall be allocated to the participating Preferred Stockholder(s) and the Transferring Stockholder in accordance with Section 3 of Article IV(A) of the charter as if (i) such Transfer were a Deemed Liquidation Event (as defined in the Charter), and (ii) the capital stock sold was the only capital stock outstanding.
(d) Prohibited Transfers. In the event that a Restricted Holder should sell any equity securities in contravention of the first refusal rights or co-sale rights of the Preferred Stockholders under Section 3.2(a) or Section 3.2(b) (a “Prohibited Transfer”), the Preferred Stockholders, in addition to such other remedies as may be available at law, in equity or hereunder, shall have the call option and put option provided under this Section 3.2(d), and the Restricted Holder shall be bound by the applicable provisions of such option. In the event of a Prohibited Transfer in violation of the first refusal rights of the Preferred Stockholders, each Preferred Stockholder shall have the right to send to such Transferring Stockholder the purchase price for such Offered Securities as is herein specified and transfer to the name of such Preferred Stockholder (or request that the Company effect such transfer in the name of a Preferred Stockholder) on the Company’s books any certificates, instruments, or book entry representing the Offered Securities to be sold. In the event of a Prohibited Transfer in violation of the co-sale rights of the Preferred Stockholders, each Preferred Stockholder shall have the right to sell to the Restricted Holder making such Prohibited Transfer the type and number of shares of equity securities equal to the number of shares each Preferred Stockholder would have been entitled to transfer to the third-party transferee(s) under this Section 3.2 had the Prohibited Transfer been effected pursuant to and in compliance with the terms hereof. Such sale will be made on the
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same terms and subject to the same conditions as would have applied had the Restricted Holder not made the Prohibited Transfer, including that:
(i) The price per share at which the shares are to be sold to the Restricted Holder shall be equal to the price per share paid by the third-party transferee(s) to the Restricted Holder in the Prohibited Transfer. The Restricted Holder shall also reimburse each Preferred Stockholder for any and all reasonable and documented out-of-pocket fees and expenses, including reasonable legal fees and expenses, incurred pursuant to the exercise or the attempted exercise of the Preferred Stockholder’s rights under this Section 3.2.
(ii) Within ninety (90) days after the later of the date on which the Preferred Stockholder (A) receives notice of the Prohibited Transfer or (B) otherwise becomes aware of the Prohibited Transfer, each Preferred Stockholder shall, if exercising the option created hereby, deliver to the Restricted Holder the certificate or certificates representing shares to be sold, each certificate to be properly endorsed for transfer.
(iii) The Restricted Holder shall, upon receipt of the certificate or certificates for the shares to be sold by a Preferred Stockholder pursuant to this Section 3.2(d), pay the aggregate purchase price therefor and the amount of reimbursable fees and expenses, as specified in Section 3.2(d)(i), in cash or by other means acceptable to the Preferred Stockholder.
4. DRAG-ALONG RIGHT OF SECURITIES.
4.1. Definitions Used in This Section.
(a) “Buyer” shall have the meaning assigned to such term in Section 4.2(b).
(b) “Drag-Along Notice” shall have the meaning assigned to such term in Section 4.2.
(c) “Drag-Along Stockholders” shall mean, collectively, (i) the Preferred Stockholders, (ii) the Key Officers, and (iii) the One Percent Common Stockholders.
(d) “Liquidation Event” means any liquidation, dissolution, or winding-up of the affairs of the Company, including an Acquisition, which entitles the stockholders of the Company to certain payments pursuant to Section A.3 of Article IV of the Charter.
(e) “Proposed Sale” shall have the meaning assigned to such term in Section 4.2(c).
(f) “Required Senior Preferred Holders” shall have the meaning assigned to such term in the Charter.
(g) “Sale of the Company” means either: (i) a transaction or series of related transactions in which stockholders of the Company representing more than 50% of the outstanding voting power of the Company sell their shares directly to a person or entity, or a group of related persons or entities (a “Stock Sale”); or (ii) a transaction that qualifies as a “Liquidation Event”.
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(h) “Selling Investors” shall have the meaning assigned to such term in Section 4.2(a).
(a) In the event that (i) the Board (other than in connection with a Stock Sale), by prior Super Board Approval, and (ii) the Required Senior Preferred Holders (the “Selling Investors”) approve a Sale of the Company specifying that this Section 4 shall apply to such transaction, then the Company shall provide written notice of such approval (the “Drag-Along Notice”) to each Drag-Along Stockholder and each Drag-Along Stockholder hereby agrees (subject to Section 4.2(c) below):
(i) to vote (in person, by proxy or by action by written consent, as applicable), with respect to all Shares, in favor of such Sale of the Company (and in favor of any related amendment to the Charter required in order to implement such Sale of the Company) and to vote in opposition to any and all other proposals that would result in a breach of any covenant, representation, warranty or any other obligation or agreement of the Company under the definitive agreement(s) related to such Sale of the Company or which could delay or impair the ability of the Company to consummate such Sale of the Company, if such transaction requires the approval of the Company’s stockholders;
(ii) if such transaction is a Stock Sale, to sell the same proportion of shares of capital stock of the Company beneficially held by such Drag-Along Stockholder as is being sold by the Selling Investors to the person or entity to whom the Selling Investors propose to sell their Shares, and, except as permitted in Section 4.2(c) below, on the same terms and conditions as the Selling Investors;
(iii) to execute and deliver all related documentation and take such other action in support of the Sale of the Company as shall reasonably be requested by the Company or the Selling Investors in order to carry out the terms and provision of this Section 4, including, without limitation, executing and delivering instruments of conveyance and transfer, and any purchase agreement, merger agreement, indemnity agreement, escrow agreement, consent, waiver, governmental filing, share certificates duly endorsed for transfer (free and clear of impermissible liens, claims and encumbrances), and any similar or related documents;
(iv) not to deposit, and to cause its Affiliate Stockholders not to deposit, except as provided in this Agreement, any Shares of the Company owned by such Drag-Along Stockholder or Affiliate Stockholders in a voting trust or subject any such Shares to any arrangement or agreement with respect to the voting of such securities, unless specifically requested to do so by the acquirer in connection with the Sale of the Company;
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(v) to refrain from exercising any dissenters’ rights or rights of appraisal under applicable law at any time with respect to such Sale of the Company; and
(vi) if the consideration to be paid in exchange for the Shares pursuant to this Section 4.2 includes any securities and due receipt thereof by any Drag-Along Stockholder would require under applicable law (x) the registration or qualification of such securities or of any person as a broker or dealer or agent with respect to such securities or (y) the provision to any Drag-Along Stockholder of any information other than such information as a prudent issuer would generally furnish in an offering made solely to “accredited investors” as defined in Regulation D promulgated under the Securities Act of 1933, as amended, the Company may cause to be paid to any such Drag-Along Stockholder in lieu thereof, against surrender of the Shares which would have otherwise been sold by such Drag-Along Stockholder, an amount in cash equal to the fair value (as determined in good faith by the Company) of the securities which such Drag-Along Stockholder would otherwise receive as of the date of the issuance of such securities in exchange for the Shares.
(c) Exceptions. Notwithstanding the foregoing:
(i) Without the prior written consent of the Majority Series G Holders, no Series G Stockholder that is a Drag Along Stockholder will be required to comply with Section 4.2(a) above in connection with any proposed Sale of the Company (the “Proposed Sale”) unless each Series G Stockholder would reasonably be expected to receive, in connection with such Proposed Sale, an amount in respect of each share of Series G Preferred Stock held by such Series G Stockholder at least equal to the Series G Liquidation Preference (as defined in the Charter); and
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(ii) No Drag-Along Stockholder will be required to comply with Section 4.2(a) above in connection with any Proposed Sale unless:
(A) any representations and warranties to be made by such Drag-Along Stockholder (other than representations and warranties being made by a Drag-Along Stockholder in his or her capacity as a current or former employee of or consultant to the Company) in connection with the Proposed Sale are limited to representations and warranties related to authority, ownership of the shares of Common Stock and/or Preferred Stock held by such Drag-Along Stockholder and the ability to convey title to such Shares, including but not limited to representations and warranties that (1) the Drag-Along Stockholder holds all right, title and interest in and to the Shares such Drag-Along Stockholder purports to hold, free and clear of all liens and encumbrances, (2) the obligations of the Drag-Along Stockholder in connection with the transaction have been duly authorized, if applicable, (3) the documents to be entered into by the Drag-Along Stockholder have been duly executed by the Drag-Along Stockholder and delivered to the acquirer and are enforceable against the Drag-Along Stockholder in accordance with their respective terms and (4) neither the execution and delivery of documents to be entered into in connection with the transaction, nor the performance of the Drag-Along Stockholder’s obligations thereunder, will cause a breach or violation of the terms of any agreement, law or judgment, order or decree of any court or governmental agency applicable to such Drag-Along Stockholder;
(B) the Drag-Along Stockholder shall not be liable for the inaccuracy of any representation or warranty made by any other person in connection with the Proposed Sale other than the Company (except to the extent that funds may be paid out of an escrow established to cover breach of representations, warranties and covenants of the Company as well as breach by any stockholder of any of identical representations, warranties and covenants provided by all stockholders (an “Escrow”));
(C) liability for indemnification, if any, of the Drag-Along Stockholder for the inaccuracy of any representations and warranties, or for the breach of any covenant, made by the Company or its Stockholders in connection with such Proposed Sale, is several and not joint with any other person (except to the extent that funds may be paid out of an Escrow) and is pro rata in proportion to, and does not exceed, the aggregate consideration receivable by such Drag-Along Stockholder (whether directly or out of an Escrow) in the Proposed Sale;
(D) liability shall be limited to the amount of consideration actually paid to such Drag-Along Stockholder in connection with such Proposed Sale, except with respect to claims related to fraud by such Drag-Along Stockholder, the liability for which need not be limited as to such Drag-Along Stockholder;
(E) upon the consummation of the Proposed Sale, the aggregate consideration receivable by all holders of the Preferred Stock and Common Stock shall be allocated among the holders of Preferred Stock and Common Stock on the basis of the relative liquidation preferences and amounts to which the holders of each respective series of Preferred Stock and the holders of Common Stock are entitled in a Liquidation Event (assuming for this purpose that the Proposed Sale is a Liquidation Event even if it is structured as a Stock Sale) in accordance with the Charter in effect immediately prior to the Proposed Sale; and
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(F) the Proposed Sale does not result in such Preferred Stockholder (or affiliate thereof) having any obligation to agree to any: (i) covenant not to compete; (ii) covenant not to solicit customers, employees or suppliers of any party to the Proposed Sale (or affiliate thereof); or (iii) covenant to amend, modify or terminate any contracts or commercial arrangements to which such Preferred Stockholder (or affiliate thereof) is a party.
(d) No Interference. For avoidance of doubt, the obligations under this Section 4.2 shall not limit, restrict or otherwise interfere with the right of any Series E Holder, Series F Holder or Series G Holder to vote (in person, by proxy or by action by written consent, as applicable) with respect to all shares of Series E Preferred Stock, Series F Preferred Stock or Series G Preferred Stock that such Series E Holder, Series F Holder or Series G Holder owns or over which such Series E Holder, Series F Holder or Series G Holder otherwise exercises voting power, in any way such Series E Holder, Series F Holder or Series G Holder determines in its sole discretion with respect to any proposal on which the holders of Series E Preferred Stock, Series F Preferred Stock or Series G Preferred Stock are entitled to vote as a separate series pursuant to the Charter, including without limitation, the right to approve an automatic conversion of the Series E Preferred Stock, Series F Preferred Stock or Series G Preferred Stock into Common Stock.
(e) Restrictions on Sales of Control of the Company. No Stockholder shall be a party to any Stock Sale unless all holders of Preferred Stock are allowed to participate in such transaction and the consideration received pursuant to such transaction is allocated among the parties thereto in the manner specified in the Company’s Charter in effect immediately prior to the Stock Sale (as if such transaction were a Deemed Liquidation Event), unless (i) the Required Senior Preferred Holders, (ii) holders holding at least 60% of the then outstanding shares of Series E Preferred Stock voting together as a single class, (iii) holders holding at least 60% of the then outstanding shares of Series F Preferred Stock, and (iv) holders holding at least 55% of the then outstanding shares of Series G Preferred Stock, voting together as a single class elect otherwise by written notice given to the Company on or prior to consummation of such transaction or series of related transactions.
(f) Consent Required to Amend, Terminate or Waive. This Section 4 may be amended or terminated and the observance of any term hereof may be waived (either generally or in a particular instance and either retroactively or prospectively) only by a written instrument executed by (a) the Company; (b) the Drag-Along Stockholders holding at least a majority of the Shares then held by the Drag-Along Stockholders then subject to this Section 4; (c) the Required Senior Preferred Holders; (d) the Required Series E Holders; and (e) the Required Series F Holders. Notwithstanding the foregoing:
(i) no term or provision of this Section 4 applicable to the Drag-Along Stockholders may be amended or terminated or the observance thereof waived with respect to or on behalf of the Drag-Along Stockholders in a manner that effects the various constituencies
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thereof (i.e., the Preferred Stockholders, the Key Officers or the One Percent Common Stockholders) differently from one another without the written consent of the Preferred Stockholders (by Preferred Stockholders holding at least a majority of the Shares held by the Preferred Stockholders), the Key Officers (by Key Officers holding at least a majority of the Shares held by the Key Officers) or the One Percent Common Stockholders (by One Percent Common Stockholders holding at least a majority of the Shares held by the One Percent Common Stockholders), as the case may be;
(ii) the consent of the Drag-Along Stockholders shall not be required for any amendment or waiver if such amendment or waiver either (A) is not directly applicable to the rights of the Drag-Along Stockholders hereunder or (B) does not adversely affect the rights of the Drag-Along Stockholders in a manner that is different from the effect on the rights of the other parties hereunder; and
(iii) Section 4.2(d) may not be amended or terminated and the observance of that provision may not be waived without the consent of (A) the Required Series E Holders as it relates to the rights of the Series E Holders, (B) the Required Series F Holders as it relates to the rights of the Series F Holders and/or (C) the Required Series G Holders as it relates to the rights of the Series G Holders.
(iv) Section 4.2(c)(i) may not be amended or terminated and the observance of that provision may not be waived without the consent of the Majority Series G Holders.
5. PROCEDURES FOR INVOLUNTARY TRANSFERS.
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until such transferring Restricted Holder, Series A-2 Holder, Series B Holder, Series C Holder, Series D Holder, Series E Holder, Series F Holder or Series G Holder gives actual written notice of the transfer of such equity securities to the Company and the Preferred Stockholders in accordance with Section 10.2 hereof.
“THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS WITH RESPECT TO THE VOTING AND THE TRANSFER OF SUCH SECURITIES SET FORTH IN THE SIXTH AMENDED AND RESTATED STOCKHOLDERS’ AGREEMENT DATED AS OF JUNE 1, 2017 (AS AMENDED AND/OR RESTATED AND IN EFFECT FROM TIME TO TIME), BY AND AMONG THE ISSUER OF SUCH SECURITIES AND THE REGISTERED HOLDER OF THIS CERTIFICATE (OR SUCH HOLDER’S PREDECESSOR-IN-INTEREST) AND CERTAIN OTHERS. A COPY OF SUCH AGREEMENT IS ON FILE AND MAY BE INSPECTED BY THE REGISTERED HOLDER OF THIS CERTIFICATE AT THE PRINCIPAL EXECUTIVE OFFICE OF THE ISSUER.”
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conclusively deemed to have been given by the Company if and when the Company countersigns the Instrument of Adherence executed by such Person). In addition, the Company agrees that it shall not issue any securities to (x) any Key Officer, (y) any Person who, together with their Affiliates, after such acquisition would be a One Percent Common Stockholder or (z) any Person who purchases shares of Preferred Stock upon the exercise of Derivative Securities, unless such Key Officer or Person executes and delivers an Instrument of Adherence to this Agreement. Any such Instrument of Adherence executed by any such Key Officer or Person and countersigned by the Company shall become a part of this Agreement. It is hereby understood and agreed that such Key Officer or Person may become a party to this Agreement without having to obtain the signature, consent, approval or permission of any of the parties hereto other than the Company and that, immediately upon such Key Officer or Person becoming a party to this Agreement, such Key Officer or Person shall be deemed to be a Common Stockholder, One Percent Common Stockholder, Key Officer, Series A-1 Holder, Series A-2 Holder, Series B Holder, Series C Holder, Series D Holder, Series E Holder, Series F Holder or Series G Holder hereunder, as the case may be, and the Schedule of Common Stockholders, the Schedule of Key Officers, the Schedule of Series A-1 Stockholders, the Schedule of Series A-2 Stockholders, the Schedule of Series B Stockholders, the Schedule of Series C Stockholders, the Schedule of Series D Stockholders, the Schedule of Series E Stockholders, the Schedule of Series F Stockholders or the Schedule of Series G Stockholders, as the case may be, shall be updated automatically without any action required by the parties hereto.
9. “BAD ACTOR” MATTERS.
9.1. Representation.
Each Person with the right to designate or participate in the designation of a director pursuant to this Agreement hereby represents that none of the “bad actor” disqualifying events described in Rule 506(d)(1)(i)-(viii) promulgated under the Securities Act (a “Disqualification Event”) is applicable to such Person or any of its Rule 506(d) Related Parties, except, if applicable, for a Disqualification Event as to which Rule 506(d)(2)(ii) or (iii) or (d)(3) is applicable. For purposes of this Agreement, “Rule 506(d) Related Party” shall mean with respect to any Person any other Person that is a beneficial owner of such first Person’s securities for purposes of Rule 506(d) of the Securities Act.
9.2. Covenant.
Each Person with the right to designate or participate in the designation of a director pursuant to this Agreement hereby agrees that it shall notify the Company promptly in writing in the event a Disqualification Event becomes applicable to such Person or any of its Rule 506(d) Related Parties, except, if applicable, for a Disqualification Event as to which Rule 506(d)(2)(ii) or (iii) or (d)(3) is applicable.
10.1. Amendments, Consents, Waivers, Etc.
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(a) Except as otherwise provided in this Agreement, this Agreement or any provision hereof may be amended or terminated by the written agreement of the Company and the Stockholders then party to this Agreement holding at least 60% of the Shares then held by all Stockholders (on an as-converted to Common Stock basis). The observance of any provision of this Agreement that is for the specific benefit of the Series A-2 Holders, Series B Holders, Series C Holders, the Series D Holders, the Series E Holders, the Series F Holders or the Series G Holders may be waived (either generally or in a particular instance, and either retroactively or prospectively), and any consent, approval or other action to be given or taken specifically by the Series A-2 Holders, Series B Holders, Series C Holders, the Series D Holders, the Series E Holders, the Series F Holders or the Series G Holders pursuant to this Agreement may be given or taken, by the consent of the Majority Series A-2 Holders, the Majority Series B Holders, the Majority Series C Holders, the Required Series D Holders, the Required Series E Holders, the Required Series F Holders or the Majority Series G Holders, as the case may be. Notwithstanding anything to the contrary herein, the rights of any of the specific Series A-2 Holders provided under Section 1.2(ii)(a) of this Agreement, the rights of any of the specific Series B Holders provided under Section 1.2(ii)(b) of this Agreement, the rights of any of the specific Series C Holders provided under Section 1.2(ii)(c) of this Agreement, the rights of any of the specific Series D Holders provided under Section 1.2(ii)(d) of this Agreement and the rights of Polaris provided under Section 1.2(ii)(e) of this Agreement shall not be amended without such party’s consent, and may be waived only by such party. The observance of any provision of this Agreement that is for the specific benefit of the Series A-1 Holders may be waived (either generally or in a particular instance, and either retroactively or prospectively), and any consent, approval or other action to be given or taken specifically by the Series A-1 Holders pursuant to this Agreement may be given or taken by, the consent of holders of record of a majority of the shares of the Series A-1 Preferred Stock then held by Series A-1 Holders. The observance of any provision of this Agreement that is for the specific benefit of the Common Stockholders may be waived (either generally or in a particular instance, and either retroactively or prospectively), and any consent, approval or other action to be given or taken specifically by the Common Stockholders pursuant to this Agreement may be given or taken, by the consent of Common Stockholders holding at least a majority of the shares of the Company’s Common Stock then held by Common Stockholders. Subject to the foregoing provisions of this paragraph, any Stockholder may in writing waive, as to him-, her- or itself only, the benefits of any provision of this Agreement. Notwithstanding any provision contained herein to the contrary, no such amendment, termination or waiver shall adversely affect any Stockholder, Series A-1 Holder, Series A-2 Holder, Series B Holder, Series C Holder, Series D Holder, Series E Holder, Series F Holder or Series G Holder in a manner different from or disproportionate to any other Stockholder, Series A-1 Holder, Series A-2 Holder, Series B Holder, Series C Holder, Series D Holder, Series E Holder, Series F Holder or Series G Holder, respectively, without such party’s consent.
(b) No course of dealing between or among any of the parties to this Agreement will operate as a waiver of any rights under this Agreement. No waiver of any breach or default hereunder will be valid unless in writing signed by the waiving party. No failure or other delay by any person in exercising any right, power or privilege hereunder will be or operate as a waiver thereof, nor will any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege.
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(c) The Company shall give prompt notice of any amendment or termination hereof or waiver hereunder to any party hereto that did not consent in writing to such amendment, termination, or waiver. Any amendment, termination, or waiver effected in accordance with this Section 10.1 shall be binding on all parties hereto, regardless of whether any such party has consented thereto.
(a) If to the Company:
Neuronetics, Inc.
0000 Xxxxxxxxxxxx Xxxx
Xxxxxxx, Xxxxxxxxxxxx 00000
Attention: Chief Executive Officer
Telecopier No. (000) 000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxxxxxx X. Xxxxxx and Xxxxxxx X. Xxxxxx
Xxxxxx Xxxxxxxx LLP
000 Xxxxxx Xxxx
000 Xxxxxxx Xxxx
Xxxxxx, XX 00000-0000
Telecopier No. (000) 000-0000
(b) If to any Series G Holder, the address and telecopier information set forth on the Schedule of Series G Stockholders attached hereto, with copies (which shall not constitute notice) to:
Xxxxxxx X. Bison
Xxxxxxx Procter LLP
000 Xxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
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(c) If to any Series F Holder, the address and telecopier information set forth on the Schedule of Series F Stockholders attached hereto, with copies (which shall not constitute notice) to:
Xxxxxxx Xxxxxxxx
Xxxxxx Xxxxxx LLP
0000 Xxxx Xxxx Xxxx, Xxxxxxxx 0
Xxxx Xxxx, XX 00000
(d) If to any Series E Holder, the address and telecopier information set forth on the Schedule of Series E Stockholders attached hereto, with copies (which shall not constitute notice) to:
Xxx X. Xxxxxxxxx
Xxxxxxxxx Xxxxxxx Xxxxxx Xxxxxxxxxx
Xxxxxxxx & Xxxxxxxxx, LLP
000 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Telecopier No. (000) 000-0000
(e) If to any Series D Holder, the address and telecopier information set forth on the Schedule of Series D Holders attached hereto, with a copy (which shall not constitute notice) to:
Xxx Xxxx
Cooley Godward Kronish LLP
Five Palo Alto Square
0000 Xx Xxxxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Telecopier No. (000) 000-0000
(f) If to any Series C Holder, the address and telecopier information set forth on the Schedule of Series C Holders attached hereto, with a copy (which shall not constitute notice) to:
P. Xxxxxxxx Xxxx
Quaker BioVentures
Xxxx Centre, 0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000-0000
(g) If to any Series B Holder, the address and telecopier information set forth on the Schedule of Series B Holders attached hereto, with copies (which shall not constitute notice) to:
J. Xxxxx XxXxxxx
Xxxxxx Xxxxxxx Xxxxxxxx & Xxxxxx
000 Xxxx Xxxx Xxxx
Xxxx Xxxx, XX 00000-0000
Telecopier No (000) 000-0000
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Three Arch Partners
0000 Xxxxxx Xxxx
Xxxxxxx Xxxxxx, XX 00000
Attn: Xxxxxxx Xxx
(h) If to any Series A-2 Holder, the address and telecopier information set forth on the Schedule of Series A-2 Stockholders attached hereto, with copies (which shall not constitute notice) to:
Xxxxxx X. Xxxxxx
Xxxxxxx & Xxxxxx
One Stamford Plaza
000 Xxxxxxx Xxxx.
Xxxxxxxx, XX 00000-0000
Telecopier:: (000) 000-0000
Xxxxxxx Xxxxx, Managing Director
Investor Growth Capital, Inc.
c/o Xxxxxxxx Industries
1177 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Telecopier: (000) 000-0000
(i) If to any Series A-1 Holder, the address and telecopier information set forth on the Schedule of Series A-1 Stockholders attached hereto, with a copy (which shall not constitute notice) to:
Xxxxxxx X. Xxxxxx
XxXxxxx Long Xxxxxxxx
000 Xxxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX 00000
Telecopier no. (000) 000-0000
(j) If to any Common Stockholder or to any Key Officers, the address and telecopier information set forth on the Schedule of Common Stockholders, the Schedule of Key Officers attached hereto or the Instrument of Adherence, as the case may be.
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or affiliates. Each of the Stockholders and the Company acknowledges that Pepper is representing only the Company in the transactions contemplated by this Agreement. Pursuant to Rule 1.7 of the Rules of Professional Conduct adopted by the Supreme Court of Pennsylvania, an attorney must avoid representations in which the attorney has or had a relationship with another party interested in the representation without the informed written consent of all parties affected. By executing this Agreement, each of the Stockholders and the Company hereby consents to Pepper’s representation of the Company in the transactions contemplated by this Agreement and Pepper’s previous or continuing representation of one or more of the Stockholders or their affiliates in matters unrelated to such transactions.
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Holders will bind all permitted transferees of such Series E Preferred Stock. Except as otherwise provided in this Agreement, the provisions of this Agreement that are for Series F Holders’ benefit, as the holders of Series F Preferred Stock, will inure to the benefit of all permitted transferees of such Series F Holders, and the applicable provisions of this Agreement that bind the Series F Holders will bind all permitted transferees of such Series F Preferred Stock. Except as otherwise provided in this Agreement, the provisions of this Agreement that are for Series G Holders’ benefit, as the holders of Series G Preferred Stock, will inure to the benefit of all permitted transferees of such Series G Holders, and the applicable provisions of this Agreement that bind the Series G Holders will bind all permitted transferees of such Series G Preferred Stock.
10.11. Governing Law. This Agreement will be governed by and interpreted and construed in accordance with the internal laws of the State of Delaware, as applied to agreements under seal made, and entirely to be performed, within Delaware.
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by the preceding clauses (i) or (ii) shall be subject to and conditioned upon any such assignee’s delivery to the Company and the other Stockholders of an Instrument of Adherence pursuant to which such assignee shall confirm their agreement to be subject to and bound by all of the provisions set forth in this Agreement that were applicable to the assignor of such assignee. Except as specifically permitted hereby, no party hereto may assign its rights or delegate its obligations under this Agreement without (i) the prior written consent of the Company (which shall not be unreasonably withheld, delayed or conditioned) and (ii) complying with Section 4.4 of the Series G Purchase Agreement, and any attempted assignment or delegation without such consent or compliance will be void and of no effect. Nothing in this Agreement will confer any rights or remedies on any person other than the parties hereto and their respective successors and permitted assigns.
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connection with a transfer of shares of capital stock of the Company, such Stockholder’s spouse shall execute and deliver to the Company a consent of spouse in the form of Exhibit B hereto (“Consent of Spouse”), effective on the date hereof. Notwithstanding the execution and delivery thereof, such consent shall not be deemed to confer or convey to the spouse any rights in such Stockholder’s Shares that do not otherwise exist by operation of law or the agreement of the parties. If any individual Stockholder should marry or remarry subsequent to the date of this Agreement, such Stockholder shall within thirty (30) days thereafter obtain his/her new spouse’s acknowledgement of and consent to the existence and binding effect of all restrictions contained in this Agreement by causing such spouse to execute and deliver a Consent of Spouse acknowledging the restrictions and obligations contained in this Agreement and agreeing and consenting to the same.
[The rest of this page is intentionally left blank.]
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[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
COMPANY: | NEURONETICS, INC. | |||||
By: | /s/ Xxxxxxxxxxx Xxxxxxxx | |||||
Name: | Xxxxxxxxxxx Xxxxxxxx | |||||
Title: | President and Chief Executive Officer |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | CHV IV, L.P. | |||||
By | Ascension Health Ventures IV, LLC, Its General Partner | |||||
By: | /s/ Xxxxxxx X. Xxxxxxx | |||||
Name: Xxxxxxx X. Xxxxxxx Title: Senior Managing Director |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | GE VENTURES LIMITED | |||||
By: | /s/ Xxxxx Xxxxxx | |||||
Name: | Xxxxx Xxxxxx | |||||
Title: | Authorized Signatory |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | INVESTOR GROWTH CAPITAL LIMITED | |||||
By: | /s/ Xxxxxxx X. Xxxxxx | |||||
Name: | Xxxxxxx X. Xxxxxx | |||||
Title: | Director | |||||
INVESTOR GROUP, L.P. | ||||||
By: Investor Growth Capital, LLC, its General Partner | ||||||
By: | /s/ Xxxxxxx X. Xxxxxx | |||||
Name: Xxxxxxx X. Xxxxxx | ||||||
Title: Secretary | ||||||
IGC FUND VI, L.P. | ||||||
By: Investor Growth Capital, LLC, its General Partner | ||||||
By: | /s/ Xxxxxxx X. Xxxxxx | |||||
Name: Xxxxxxx X. Xxxxxx | ||||||
Title: Secretary |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | ONSET IV, L.P. | |||||||
By: | ONSET IV Management, LLC its General Partner | |||||||
By: | /s/ Xxx Xxxxxxx | |||||||
Name: | Xxx Xxxxxxx | |||||||
Title: |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | INTERWEST INVESTORS VIII, L.P. | |||||||
By: | InterWest Management Partners VIII, LLC, its General Partner | |||||||
By: | /s/ Xxxxxxx X. Xxxxxx | |||||||
Name: | Xxxxxxx X. Xxxxxx | |||||||
Title: | Manging Director | |||||||
INTERWEST PARTNERS VIII, L.P. | ||||||||
By: | InterWest Management Partners VIII, LLC, its General Partner | |||||||
By: | /s/ Xxxxxxx X. Xxxxxx | |||||||
Name: | Xxxxxxx X. Xxxxxx | |||||||
Title: | Manging Director | |||||||
INTERWEST INVESTORS Q VIII, L.P. | ||||||||
By: | InterWest Management Partners VIII, LLC, its General Partner | |||||||
By: | /s/ Xxxxxxx X. Xxxxxx | |||||||
Name: | Xxxxxxx X. Xxxxxx | |||||||
Title: | Manging Director |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | KBL HEALTHCARE, L.P. | |||||||
By: | KBL SBIC, Inc., its General Partner | |||||||
By: | /s/ Xxxxxxx Xxxxxx | |||||||
Name: | Xxxxxxx Xxxxxx | |||||||
Title: | ||||||||
KBL PARTNERSHIP, L.P. | ||||||||
By: | KBL Healthcare, LLC, its General Partner | |||||||
By: | /s/ Xxxxxxx Xxxxxx | |||||||
Name: | Xxxxxxx Xxxxxx | |||||||
Title: | ||||||||
KBL HEALTHCARE VENTURES, L.P. | ||||||||
By: | KBL Healthcare, LLC its General Partner | |||||||
By: | /s/ Xxxxxxx Xxxxxx | |||||||
Name: | Xxxxxxx Xxxxxx | |||||||
Title: |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | THREE ARCH PARTNERS IV, L.P. | |||||||
By: | Three Arch Management IV, L.L.C., its General Partner | |||||||
By: | /s/ Xxxxxxx Xxxxxx | |||||||
Name: | Xxxxxxx Xxxxxx | |||||||
Title: | Managing Member | |||||||
THREE ARCH ASSOCIATES IV, L.P. | ||||||||
By: | Three Arch Management IV, L.L.C., its General Partner | |||||||
By: | /s/ Xxxxxxx Xxxxxx | |||||||
Name: | Xxxxxxx Xxxxxx | |||||||
Title: | Managing Member | |||||||
THREE ARCH CAPITAL, L.P. | ||||||||
By: | Three Arch Management IV, L.L.C., its General Partner | |||||||
By: | /s/ Xxxxxxx Xxxxxx | |||||||
Name: | Xxxxxxx Xxxxxx | |||||||
Title: | Managing Member | |||||||
TAC ASSOCIATES, L.P. | ||||||||
By: | TAC Management, L.L.C., its its General Partner | |||||||
By: | /s/ Xxxxxxx Xxxxxx | |||||||
Name: | Xxxxxxx Xxxxxx | |||||||
Title: | Managing Member |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | AMV PARTNERS I, L.P. | |||||||
By: | Accuitive Medical Ventures, LLC., its General Partner | |||||||
By: | /s/ Xxxxxx Xxxxxx | |||||||
Name: | Xxxxxx Xxxxxx | |||||||
Title: |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | QPIV, LLC | |||||
By: | /s/ P. Xxxxxxxx Xxxx | |||||
Name: P. Xxxxxxxx Xxxx | ||||||
Title: Authorized Member on behalf of Quaker Partners |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | Industry Ventures Healthcare, L.L.C. | |||||
By: Industry Ventures Management VII, L.L.C., its General Partner | ||||||
By: | /s/ Xxxxxx Xxxxxx | |||||
Name: Xxxxxx Xxxxxx Title: Member |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | NEW LEAF VENTURES II, L.P.
By: New Leaf Venture Associates II, L.P. Its: General Partner
By: New Leaf Venture Management II, L.L.C. Its: General Partner
By: /s/ Xxxxx Xxxxxxxx Name: Xxxxx Xxxxxxxx Title: Chief Financial Officer |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | POLARIS VENTURE PARTNERS V, L.P.
By: Polaris Venture Management Co. V, L.L.C., Its General Partner
By: /s/ Xxx Xxxxxxxxx Xxx Xxxxxxxxx, Attorney-in-Fact
POLARIS VENTURE PARTNERS ENTREPRENEURS’ FUND V, L.P.
By: Polaris Venture Management Co. V, L.L.C., Its General Partner
By: /s/ Xxx Xxxxxxxxx Xxx Xxxxxxxxx, Attorney-in-Fact
POLARIS VENTURE PARTNERS FOUNDERS’ FUND V, L.P.
By: Polaris Venture Management Co. V, L.L.C., Its General Partner
By: /s/ Xxx Xxxxxxxxx Xxx Xxxxxxxxx, Attorney-in-Fact
POLARIS VENTURE PARTNERS SPECIAL FOUNDERS’ FUND V, L.P.
By: Polaris Venture Management Co. V, L.L.C., Its General Partner
By: /s/ Xxx Xxxxxxxxx Xxx Xxxxxxxxx, Attorney-in-Fact |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS: | PFIZER INC.
By: /s/ Xxxxxxx Xxxxxx Name: Xxxxxxx Xxxxxx Title: Vice President |
[Signature Page to Sixth Amended and Restated Stockholders’ Agreement]
STOCKHOLDERS:
/s/ Xxxxx Xxxxxx |
Xxxxx Xxxxxx |
Schedule of Series G Stockholders
CHV IV, L.P.
GE Ventures Limited
Polaris Venture Partners V, L.P.
Polaris Venture Partners Entrepreneurs’ Fund V, L.P.
Polaris Venture Partners Special Founders’ Fund V, L.P.
Polaris Venture Partners Founders’ Fund V, L.P.
Pfizer Inc.
New Leaf Ventures II, L.P.
Industry Ventures Healthcare, L.L.C.
Three Arch Partners IV, L.P.
Three Arch Associates IV, L.P.
Three Arch Capital, L.P.
TAC Associates L.P.
IGC Fund VI, L.P.
ONSET IV, L.P.
InterWest Partners VIII, L.P.
InterWest Investors VIII, L.P.
InterWest Investors Q VIII, L.P.
KBL Partnership, L.P.
KBL Healthcare Ventures, L.P.
AMV Partners I, L.P.
Xxxxx Xxxxxx
Schedule of Series F Stockholders
GE Ventures Limited
Polaris Venture Partners V, L.P.
Polaris Venture Partners Entrepreneurs’ Fund V, L.P.
Polaris Venture Partners Special Founders’ Fund V, L.P.
Polaris Venture Partners Founders’ Fund V, L.P.
Pfizer Inc.
New Leaf Ventures II, L.P.
QPIV, LLC
Three Arch Partners IV, L.P.
Three Arch Associates IV, L.P.
Three Arch Capital, L.P.
TAC Associates L.P.
IGC Fund VI, L.P.
ONSET IV, L.P.
InterWest Partners VIII, L.P.
InterWest Investors VIII, L.P.
InterWest Investors Q VIII, L.P.
KBL Healthcare, L.P.
KBL Partnership, L.P.
KBL Healthcare Ventures, X.X.
Xxxxxx Foundation
AMV Partners I, L.P.
Xxxxxxx Xxxx
Xxxxx Xxxxxx
Xxxxx Xxxxx
Xxxxxxx X. Xxxxxx
Schedule of Series E Stockholders
Polaris Venture Partners V, L.P.
Polaris Venture Partners Entrepreneurs’ Fund V, L.P.
Polaris Venture Partners Special Founders’ Fund V, L.P.
Polaris Venture Partners Founders’ Fund V, L.P.
Pfizer Inc.
New Leaf Ventures II, L.P.
QPIV, LLC
Three Arch Partners IV, L.P.
Three Arch Associates IV, L.P.
Three Arch Capital, L.P.
TAC Associates L.P.
Investor Growth Capital Limited
Investor Group, L.P.
ONSET IV, L.P.
InterWest Partners VIII, L.P.
InterWest Investors VIII, L.P.
InterWest Investors Q VIII, X.X.
Xxxxxx Foundation
Xxxxxxx Xxxx
Xxxxx Xxxxxx
Schedule of Series D Stockholders
New Leaf Ventures II, L.P.
QPIV, LLC
Three Arch Partners IV, L.P.
Three Arch Associates IV, L.P.
Three Arch Capital, L.P.
TAC Associates L.P.
Investor Growth Capital Limited
Investor Group, L.P.
ONSET IV, L.P.
InterWest Partners VIII, L.P.
InterWest Investors VIII, L.P.
InterWest Investors Q VIII, L.P.
KBL HEALTHCARE VENTURES, X.X.
Xxxxxx Foundation
Xxxxxxx Xxxx
Xxxxx X. Xxxxxx
Schedule of Series C Stockholders
QPIV, LLC
Three Arch Partners IV, L.P.
Three Arch Associates IV, L.P.
Three Arch Capital, L.P.
TAC Associates L.P.
AMV Partners I, L.P.
Investor Growth Capital Limited
Investor Group, L.P.
ONSET IV, L.P.
InterWest Partners VIII, L.P.
InterWest Investors VIII, L.P.
InterWest Investors Q VIII, L.P.
KBL HEALTHCARE, L.P.
KBL Partnership, L.P.
Schedule of Series B Stockholders
Three Arch Partners IV, L.P.
Three Arch Associates IV, L.P.
Three Arch Capital, L.P.
TAC Associates L.P.
AMV Partners I, L.P.
Investor Growth Capital Limited
Investor Group, L.P.
ONSET IV, L.P.
InterWest Partners VIII, L.P.
InterWest Investors VIII, L.P.
InterWest Investors Q VIII, L.P.
KBL HEALTHCARE, L.P.
KBL Partnership, L.P.
Schedule of Series A-2 Stockholders
Investor Growth Capital Limited
Investor Group, L.P.
IGC Fund VI, L.P.
ONSET IV, L.P.
InterWest Partners VIII, L.P.
InterWest Investors VIII, L.P.
InterWest Investors Q VIII, L.P.
KBL HEALTHCARE, L.P.
KBL Partnership, L.P.
Schedule of Series A-1 Stockholders
Xxxxxx X. Xxxxxx Revocable Trust
Xxxxxxx X. Xxxxxx
Xxxxxx X. Xxxxxx
Schedule of Common Stockholders
Xxxxx X. Xxxxxx
Xxxx Xxxxxx
Xxxxx X. Xxxxxx
Xxxxx Xxxxxx
Xxxx Xxxxxxx
Xxxxxxx Xxxxxx
Xxxxx Xxxxxx
Xxxxxxx X. Xxxxxxx
Xxxxxxx Xxxxxxxxx
Xxxxxxxxx Xxxx
Xxxxxxxx Xxxxxx
Xxxxxx Xxxxxxxx
Xxxx Xxxxxxx
Xxxxxxxxx X. Xxxxxx
Xxxxxx Xxxxxxxxx
Xxxxxxx Xxxxxxx
Xxxxxxx Xxxx
Roelof Trip
Xxxxxx Xxxxx
Xxxxx Xxxxxx
Xxxxxx Xxxxx
Xxxxxxx Xxxxxx
Xxxxx Xxxxxx
Xxxx Xxxxxxx
Xxxxx Xxxxxxxxxxxx
Xxxxx Xxxxx
Xxxxxxx Xxxxxxx
Xxxxxxx XxXxxxx
Xxxxx XxXxxx
Xxxxxxx Xxxxx
Xxxxxxxx Xxxxxxxxxx
Xxx Xxxxxxx
Xxxxxxxx Xxxxxxx
Xxxxxxx Xxxxxxx
Xxxxxx Xxxxxxxxx
Xxxx Xxxxxxxx
Xxxxx Xxxxxxx
Xxxxx Xxxxx
Xxxxxxxx Xxxxx
Xxxx Xxxxxx
Xxxxxx X. Xxxxxxxxxxx
Xxxxxxxx Xxx
Xxxxx Xxxxxxx
Xxxxxxx Xxxxxxxx
Xxxxxx Xxxx
Xxxxxxxxxxx Xxxxxx
Xxxxxxx Xxxxxx
Xxxxxxxxxxx Xxxxx
Xxxx Xxxxxx
Xxxx Xxxxxxx
Xxxxxxx Xxxxxxxx
Xxxxxxx Xxxx
Xxx Xxxxxxx
Xxxxxxx Xxxxxxxx
Xxxxxx Xxxxxx
Xxx Xxxxx
Xxxx Xxxx
Xxxxxx Xxxxxxxx
Xxxxxx Xxxxx
Xxxxxx Xxxx
Xxxxx Xxxxx
Xxxxxx Xxxxxx
Xxxx Xxxxxxxx
Xxx Xxxxx
Xxxx Xxxxxxxx
Xxxxxxx Xxxxx
Schedule of Key Officers
Xxxxx Xxxxxxxx
Xxxxx Xxxxx
Xxxx Xxxxxxxxx
Xxxx Xxxxxxxxx, MD
Xxxx Xxxxx
Xxxx Ways, Ph.D.
Xxxxx Xxxxxxxxxxxx
Xxxx X. Xxxxxx
Xxxxxxx XxXxxxxxx
Xxxxx MacKinnnon
Xxxxxxxx X. Xxxxxx
Xxxxx Xxxxxx
EXHIBIT A to Sixth Amended and Restated Stockholders’ Agreement
Neuronetics, Inc.
Instrument of Adherence
Reference is made to that certain Sixth Amended and Restated Stockholders’ Agreement, dated as of June 1, 2017, a copy of which is attached hereto (as amended and in effect from time to time, the “Stockholders’ Agreement”), by and among Neuronetics, Inc., a Delaware corporation (the “Company”), and the Stockholders party thereto. Capitalized terms used herein without definition shall have the respective meanings ascribed thereto in the Stockholders’ Agreement.
The undersigned, , in order to become the owner or holder of shares [or options, warrants, or other rights to purchase such shares] (the “Acquired Shares”) of [Common Stock/Preferred Stock] of the Company, hereby agrees that, from and after the date hereof, (i) the undersigned has become [an Additional Stockholder][a Key Officer] party to the Stockholders’ Agreement as a [Common Stockholder/Series A-1 Holder/Series A-2 Holder/Series B Holder/Series C Holder/Series D Holder/Series E Holder/Series F Holder/Series G Holder/Key Officer] party thereunder and is entitled to all of the benefits under and is subject to all of the obligations, restrictions and limitations set forth in the Stockholders’ Agreement that are applicable to the [Common Stockholders/Series A-1 Holders/Series A-2 Holders/Series B Holders/Series C Holders/Series D Holders/Series E Holders/Series F Holders/Series G Holders/Key Officers], (ii) all of the Acquired Shares are entitled to all of the benefits, and are subject to all of the obligations, restrictions, limitations, provisions and conditions, under the Stockholders’ Agreement that are applicable to the Shares held by the undersigned, if any, (iii) the Stockholders party to the Stockholders’ Agreement are intended third-party beneficiaries of this Instrument of Adherence, and (iv) any notice required to be given to the Company pursuant to Section 10.2 of the Stockholders’ Agreement should be sent to Neuronetics, Inc., 0000 Xxxxxxxxxxxx Xxxx, Xxxxxxx, Xxxxxxxxxxxx 00000. This Instrument of Adherence shall take effect and shall become a part of the Stockholders’ Agreement immediately upon execution.
Executed as of the date set forth below.
Signature:
Name:
Address:
Tel. No.:
Fax No.:
E-mail:
Date:
Acknowledged and Accepted:
NEURONETICS, INC. | ||
By: | ||
Name: | ||
Title: |
EXHIBIT B to Sixth Amended and Restated Stockholders’ Agreement
Consent of Spouse
I, [ ], spouse of [ ], acknowledge that I have read the Sixth Amended and Restated Stockholders’ Agreement, dated as of June 1, 2017, to which this Consent is attached as Exhibit B (the “Agreement”), and that I know the contents of the Agreement. I am aware that the Agreement contains provisions regarding (i) voting and transfer of shares of capital stock, and/or (ii) certain rights to certain other holders of capital stock of the Company upon a proposed Transfer of Offered Securities of the Company which my spouse may own including any interest I might have therein.
I hereby agree that my interest, if any, in any Offered Securities of the Company subject to the Agreement shall be irrevocably bound by the Agreement and further understand and agree that any community property interest I may have in such Offered Securities of the Company shall be similarly bound by the Agreement.
I am aware that the legal, financial and related matters contained in the Agreement are complex and that I am free to seek independent professional guidance or counsel with respect to this Consent. I have either sought such guidance or counsel or determined after reviewing the Agreement carefully that I will waive such right.
Dated as of the [ ] day of [ , ].