EXHIBIT 4.3
VITRIA TECHNOLOGY, INC.
SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
This Second Amended and Restated Investor Rights Agreement (the
"Agreement") is entered into as of the 20/th/ day of May 1999, by and among
Vitria Technology, Inc., a California corporation (the "Company") and holders of
the Company's Series A Preferred Stock (the "Series A Stock"), holders of the
Company's Series A1 Preferred Stock (the "Series A1 Stock"), holders of the
Company's Series B Preferred Stock (the "Series B Stock"), the holders of the
Company's Series C Preferred Stock (the "Series C Stock") and the purchasers of
the Company's Series D Preferred Stock (the "Series D Stock") set forth on
Exhibit A of that certain Series D Preferred Stock Purchase Agreement of even
date herewith (the "Purchase Agreement"), all as set forth on Exhibit A hereto.
Such holders of Series A Stock, Series A1 Stock, Series B Stock, Series C Stock
and purchasers of the Series D Stock shall be referred to hereinafter,
collectively, as the "Investors" and each individually as an "Investor."
Recitals
Whereas, the Company has issued the Series A Stock, Series A1 Stock,
Series B Stock and Series C Stock to certain of the Investors;
Whereas, the Company issued Series C Stock to certain Investors and
signed the First Amended and Restated Investor Rights Agreement dated October
23, 1998 (the "Prior Agreement") entered into between the Company and the
holders of Series A Stock, Series A1 Stock, Series B Stock and Series C Stock.
The holders of Series A Stock, Series A1 Stock, Series B Stock and Series C
Stock possess certain registration rights, information rights and other rights
under such Prior Agreement;
Whereas, the Company and the undersigned holders of Series A Stock,
Series A1 Stock, Series B Stock and Series C Stock desire to terminate the Prior
Agreement and to accept the rights created pursuant hereto in lieu of the rights
granted to them under the Prior Agreement;
Whereas, the Company proposes to sell and issue certain shares of its
Series D Stock pursuant to the Purchase Agreement; and
Whereas, as a condition of entering into the Purchase Agreement, the
purchasers of Series D Stock have requested that the Company extend to them
registration rights, information rights and other rights as set forth below.
Now, Therefore, in consideration of the mutual promises,
representations, warranties, covenants and conditions set forth in this
Agreement and in the Purchase Agreement, the parties mutually agree as follows:
1. Amendment and Restatement of Prior Agreement.
1.1 Amendment and Restatement. The Prior Agreement is terminated in
its entirety and restated herein. Such termination and restatement is effective
upon execution of this Agreement by the Company and the holders of at least a
majority in interest of the Registrable Securities (as the term is defined in
the Prior Agreement). Upon such execution, all provisions of, rights granted and
covenants made in the Prior Agreement are hereby waived, released and terminated
in their entirety and shall have no further force or effect. The rights and
covenants contained in this Agreement set forth the sole and entire agreement
among the Company and the holders of Series A Stock, Series A1 Stock, Series B
Stock,
1.
Series C Stock and Series D Stock on the subject matter hereof and supersede any
and all rights granted and covenants made under any prior agreements.
2. General.
2.1 Definitions. As used in this Agreement the following terms shall have
the following respective meanings:
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Form S-3" means such form under the Securities Act (as hereinafter
defined) as in effect on the date hereof or any successor registration form
under the Securities Act subsequently adopted by the SEC (as hereinafter
defined) which permits inclusion or incorporation of substantial information by
reference to other documents filed by the Company with the SEC.
"Holder" means any person owning of record Registrable Securities (as
hereinafter defined) or any assignee of record of such Registrable Securities in
accordance with Section 3.10 hereof that have not been sold to the public.
"Initial Offering" means the Company's first firm commitment
underwritten public offering of its common stock registered under the Securities
Act.
"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 effectiveness of such
registration statement or document.
"Registrable Securities" means (a) common stock of the Company issued
or issuable upon conversion of the Shares (as hereinafter defined) and (b) any
common stock of the Company issued as (or issuable upon the conversion or
exercise of any warrant, right or other security which is issued as) a dividend
or other distribution with respect to, or in exchange for or in replacement of,
such above-described securities. Notwithstanding the foregoing, Registrable
Securities shall not include any securities sold by a person to the public
either pursuant to a registration statement or Rule 144 or sold in a private
transaction in which the transferor's rights under Section 3 of this Agreement
are not assigned.
"Registrable Securities then outstanding" shall be the number of
shares determined by calculating the total number of shares of the Company's
common stock that are Registrable Securities and either (a) are then issued and
outstanding or (b) are issuable pursuant to then exercisable or convertible
securities.
"Registration Expenses" shall mean all expenses incurred by the
Company in complying with Sections 3.2, 3.3 and 3.4 hereof, including, without
limitation, all registration and filing fees, printing expenses, fees and
disbursements of counsel for the Company, reasonable fees and disbursements not
to exceed Twenty Five Thousand Dollars ($25,000) of a single special counsel for
the Holders, blue sky fees and expenses 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).
"SEC" or "Commission" means the Securities and Exchange Commission.
"Securities Act" shall mean the Securities Act of 1933, as amended.
2.
"Selling Expenses" shall mean all underwriting discounts and selling
commissions applicable to the sale.
"Shares" shall mean the Series A Stock, Series A1 Stock, Series B
Stock, Series C Stock and Series D Stock, whose holders are parties hereto, all
as held by the Investors listed on Exhibit A hereto and their permitted assigns
pursuant to Section 3.10 hereof.
3. Registration; Restrictions on Transfer.
3.1 Restrictions on Transfer.
(a) Each Holder agrees not to make any disposition of all or any
portion of the Shares or Registrable Securities unless and until:
(i) There is then in effect a registration statement under the
Securities Act covering such proposed disposition and such disposition is made
in accordance with such registration statement; or
(ii) (A) The transferee has agreed in writing to be bound by the
terms of this Agreement, (B) such Holder shall have notified the Company of the
proposed disposition and shall have furnished the Company with a detailed
statement of the circumstances surrounding the proposed disposition, and (C) if
reasonably requested by the Company, such Holder shall have furnished the
Company with an opinion of counsel, reasonably satisfactory to the Company, that
such disposition will not require registration of such shares under the
Securities Act. It is agreed that the Company will not require opinions of
counsel for transactions made pursuant to Rule 144 except in unusual
circumstances.
(iii) Notwithstanding the provisions of paragraphs (i) and (ii)
above, no such registration statement or opinion of counsel shall be necessary
for a transfer by a Holder which is (A) a partnership to its partners or former
partners in accordance with partnership interests, (B) a corporation to its
shareholders in accordance with their interest in the corporation, (C) a limited
liability company to its members or former members in accordance with their
interest in the limited liability company, or (D) to such Holder's family member
or trust for the benefit of an individual Holder; provided that in each case the
transferee will be subject to the terms of this Agreement to the same extent as
if he were an original Holder hereunder.
(b) Each certificate representing Shares or Registrable Securities
shall (unless otherwise permitted by the provisions of the Agreement) be stamped
or otherwise imprinted with a legend substantially similar to the following (in
addition to any legend required under applicable state securities laws or as
provided elsewhere in this Agreement):
THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE "ACT"), AS AMENDED, AND MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED, ASSIGNED, PLEDGED OR HYPOTHECATED UNLESS AND
UNTIL REGISTERED UNDER THE ACT OR UNLESS THE COMPANY HAS RECEIVED AN
OPINION OF COUNSEL SATISFACTORY TO THE COMPANY AND ITS COUNSEL THAT SUCH
REGISTRATION IS NOT REQUIRED.
(c) The Company shall be obligated to reissue promptly unlegended
certificates with respect to Shares or Registrable Securities at the request of
any holder thereof if such holder shall have obtained an opinion of counsel
(which counsel may be counsel to the Company) reasonably acceptable to
3.
the Company to the effect that the securities proposed to be disposed of may
lawfully be so disposed of without registration, qualification or legend.
(d) Any legend endorsed on an instrument pursuant to applicable state
securities laws and the stop-transfer instructions with respect to such
securities shall be removed upon receipt by the Company of an order of the
appropriate blue sky authority authorizing such removal.
3.2 Demand Registration.
(a) Subject to the conditions of this Section 3.2, if the Company
shall receive a written request from the Holders of a majority of the
Registrable Securities then outstanding (the "Initiating Holders") that the
Company file a registration statement under the Securities Act covering the
registration of Registrable Securities having an aggregate offering price to the
public of at least $5,000,000 (a "Qualified Public Offering"), then the Company
shall, within thirty (30) days of the receipt thereof, give written notice of
such request to all Holders, and subject to the limitations of this Section 3.2,
use its best efforts to effect, as soon as practicable, the registration under
the Securities Act of all Registrable Securities that the Holders request to be
registered.
(b) If the Initiating Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so
advise the Company as a part of their request made pursuant to this Section 3.2
or any request pursuant to Section 3.4 and the Company shall include such
information in the written notice referred to in Section 3.2(a) or Section
3.4(a), as applicable. In such event, the right of any Holder to include its
Registrable Securities in such registration shall be conditioned upon such
Holder's participation in such underwriting and the inclusion of such Holder's
Registrable Securities in the underwriting (unless otherwise mutually agreed by
a majority in interest of the Initiating Holders and such Holder) to the extent
provided herein. All Holders proposing to distribute their securities through
such underwriting shall enter into an underwriting agreement in customary form
with the underwriter or underwriters selected for such underwriting by the
Company (which underwriter or underwriters shall be reasonably acceptable to a
majority in interest of the Initiating Holders). Notwithstanding any other
provision of this Section 3.2 or Section 3.4, if the underwriter advises the
Company that marketing factors require a limitation of the number of securities
to be underwritten (including Registrable Securities) then the Company shall so
advise all Holders of Registrable Securities which would otherwise be
underwritten pursuant hereto, and the number of shares that may be included in
the underwriting shall be allocated to the Holders of such Registrable
Securities on a pro rata basis based on the number of Registrable Securities
held by all such Holders (including the Initiating Holders), provided however
that the number of Shares of Registrable Securities to be included in such
underwriting shall not be reduced unless all other securities are first entirely
excluded from the underwriting. Any Registrable Securities excluded or
withdrawn from such underwriting shall be withdrawn from the registration.
(c) The Company shall not be required to effect a registration
pursuant to this Section 3.2:
(i) prior to the earlier of October 31, 2001 or one hundred and
eighty (180) days following the effective date of the registration statement
pertaining to the Initial Offering;
(ii) after the Company has effected two (2) registrations
pursuant to this Section 3.2, and such registrations have been declared or
ordered effective;
(iii) during the period starting with the date of filing of, and
ending on the date one hundred eighty (180) days following the effective date of
the registration statement pertaining to
4.
the Initial Offering; provided that the Company makes reasonable good faith
efforts to cause such registration statement to become effective;
(iv) if within thirty (30) days of receipt of a written request
from Initiating Holders pursuant to Section 3.2(a), the Company gives notice to
the Holders of the Company's intention to make its Initial Offering within one
hundred and eighty (180) days; provided that the Company makes reasonable good
faith efforts to cause such registration statement to become effective; or
(v) if the Company shall furnish to Holders requesting a
registration statement pursuant to this Section 3.2, a certificate signed by the
President of the Company stating that in the good faith judgment of the Board of
Directors of the Company, it would be seriously detrimental to the Company and
its shareholders for such registration statement to be effected at such time, in
which event the Company shall have the right to defer such filing for a period
of not more than one hundred eighty (180) days after receipt of the request of
the Initiating Holders; provided that such right to delay a request shall be
exercised by the Company not more than once in any twelve (12) month period.
3.3 Piggyback Registrations. The Company shall notify all Holders of
Registrable Securities in writing at least thirty (30) days prior to the initial
filing of any registration statement under the Securities Act for purposes of a
public offering of securities of the Company (including, but not limited to,
registration statements relating to secondary offerings of securities of the
Company, but excluding registration statements relating to employee benefit
plans or with respect to corporate reorganizations or other transactions under
Rule 145 of the Securities Act) and will afford each such Holder an opportunity
to include in such registration statement all or part of such Registrable
Securities held by such Holder. Each Holder desiring to include in any such
registration statement all or any part of the Registrable Securities held by it
shall, within twenty (20) days after the above-described notice from the
Company, so notify the Company in writing and the Company shall, subject to
Section 3.3(a), cause to be registered under the Securities Act all of the
Registrable Securities that each such Holder has requested to be registered. If
a Holder decides not to include all of its Registrable Securities in any
registration statement thereafter filed by the Company, such Holder shall
nevertheless continue to have the right to include any Registrable Securities in
any subsequent registration statement or registration statements as may be filed
by the Company with respect to offerings of its securities, all upon the terms
and conditions set forth herein.
(a) Underwriting. If the registration statement under which the
Company gives notice under this Section 3.3 is for an underwritten offering, the
Company shall so advise the Holders. In such event, the right of any such Holder
to be included in a registration pursuant to this Section 3.3 shall be
conditioned upon such Holder's participation in such underwriting and the
inclusion of such Holder's Registrable Securities in the underwriting to the
extent provided herein. All Holders proposing to distribute their Registrable
Securities through such underwriting shall enter into an underwriting agreement
in customary form with the underwriter or underwriters selected for such
underwriting by the Company. Notwithstanding any other provision of the
Agreement, if the underwriter determines in good faith that marketing factors
require a limitation of the number of shares to be underwritten, the number of
shares that may be included in the underwriting shall be allocated, first, to
the Company; second, to the Holders on a pro rata basis based on the total
number of Registrable Securities held by the Holders; and third, to any
shareholder of the Company (other than a Holder) on a pro rata basis. No such
reduction shall reduce the amount of securities of the selling Holders included
in the registration below twenty percent (20%) of the total amount of securities
included in such registration, unless such offering is the Initial Offering and
such registration does not include shares of any other selling shareholders, in
which event any or all of the Registrable Securities of the Holders may be
excluded in accordance with the immediately preceding sentence. In no event will
shares of any other selling shareholder be included in such registration which
would reduce the number of shares which may be included by Holders without
5.
the written consent of Holders of not less than a majority of the Registrable
Securities proposed to be sold in such offering. For purposes of allocation in
this Section 3.3(a), for any selling shareholder that is a Holder of Registrable
Securities and that is a partnership or corporation, the partners, retired
partners and shareholders of such Holder, or the estates and family members of
any such partners and retired partners and any trusts for the benefit of any of
the foregoing persons shall be deemed to be a single "selling Holder," and any
pro rata reduction with respect to such "selling Holder" shall be based upon the
aggregate amount of Registrable Securities owned by all such related entities
and individuals.
(b) Right to Terminate Registration. The Company shall have the right
to terminate or withdraw any registration initiated by it under this Section 3.3
prior to the effectiveness of such registration whether or not any Holder has
elected to include securities in such registration. The Registration Expenses of
such withdrawn registration shall be borne by the Company in accordance with
Section 3.5 hereof.
3.4 Form S-3 Registration. In case the Company shall receive from any
Holder or Holders of Registrable Securities a written request or requests that
the Company effect a registration on Form S-3 or any similar short-form
registration statement and any related qualification or compliance with respect
to all or a part of the Registrable Securities owned by such Holder or Holders,
the Company will:
(a) promptly give written notice of the proposed registration, and
any related qualification or compliance, to all other Holders of Registrable
Securities; and
(b) use commercially reasonable efforts to effect as soon as
practicable, such registration and all such qualifications and compliances as
may be so requested and as would permit or facilitate the sale and distribution
of all or such portion of such Holder's or Holders' Registrable Securities as
are specified in such request, together with all or such portion of the
Registrable Securities of any other Holder or Holders joining in such request as
are specified in a written request given within twenty (20) days after receipt
of such written notice from the Company; provided, however, that the Company
shall not be obligated to effect any such registration, qualification or
compliance pursuant to this Section 3.4 under the following circumstances:
(i) if Form S-3 is not available for such offering by the
Holders;
(ii) if the Holders, together with the holders of any other
securities of the Company entitled to inclusion in such registration, propose to
sell Registrable Securities and such other securities (if any) at an aggregate
price to the public of less than $1,000,000;
(iii) if the Company shall furnish to the Holders a certificate
signed by the Chairman of the Board of Directors of the Company stating that in
the good faith judgment of the Board of Directors of the Company, it would be
seriously detrimental to the Company and its shareholders for such Form S-3
Registration to be effected at such time, in which event the Company shall have
the right to defer the filing of the Form S-3 registration statement for a
period of not more than one hundred twenty (120) days after receipt of the
request of the Holder or Holders under this Section 3.4; provided, that such
right to delay a request shall be exercised by the Company not more than once in
any twelve (12) month period;
(iv) if the Company has, within the twelve (12) month period
preceding the date of such request, already effected two (2) registrations on
Form S-3 for the Holders pursuant to this Section 3.4; or
6.
(v) in any particular jurisdiction in which the Company would
be required to qualify to do business or to execute a general consent to service
of process in effecting such registration, qualification or compliance.
(c) Subject to the foregoing, the Company shall file a Form S-3
registration statement covering the Registrable Securities and other securities
so requested to be registered as soon as practicable after receipt of the
request or requests of the Holders. Registrations effected pursuant to this
Section 3.4 shall not be counted as requests for registration effected pursuant
to Section 3.2.
3.5 Expenses of Registration. Except as specifically provided herein, all
Registration Expenses incurred in connection with any registration,
qualification or compliance pursuant to Section 3.2 or any registration under
Section 3.3 or Section 3.4 herein shall be borne by the Company. All Selling
Expenses incurred in connection with any registrations hereunder, shall be borne
by the holders of the securities so registered pro rata on the basis of the
number of shares so registered. The Company shall not, however, be required to
pay for expenses of any registration proceeding begun pursuant to Section 3.2 or
3.4, the request of which has been subsequently withdrawn by the Initiating
Holders unless (a) the withdrawal is based upon material adverse information
concerning the Company of which the Initiating Holders were not aware at the
time of such request or (b) the Holders of a majority of Registrable Securities
agree to forfeit their right to one requested registration pursuant to Section
3.2 or Section 3.4, as applicable, in which event such right shall be forfeited
by all Holders. If the Holders are required to pay the Registration Expenses,
such expenses shall be borne by the holders of securities (including Registrable
Securities) requesting such registration in proportion to the number of shares
for which registration was requested. If the Company is required to pay the
Registration Expenses of a withdrawn offering pursuant to clause (a) above, then
the Holders shall not forfeit their rights pursuant to Section 3.2 or Section
3.4 to a demand registration.
3.6 Obligations of the Company. Whenever required to effect the
registration of any Registrable Securities, the Company shall, as expeditiously
as reasonably possible:
(a) Prepare and file with the SEC a registration statement with
respect to such Registrable Securities and use all reasonable 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 up to ninety (90) days or, if earlier,
until the Holder or Holders have completed the distribution related thereto.
(b) Prepare and file with the SEC 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 such number of copies of a prospectus,
including a preliminary prospectus in conformity with the requirements of the
Securities Act, and such other documents as they may reasonably request in order
to facilitate the disposition of Registrable Securities owned by them.
(d) Use all reasonable 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.
7.
(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(s) 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 in the light of the circumstances then
existing.
(g) Furnish, at the request of a majority of the Holders
participating in the registration, on the date that such Registrable Securities
are delivered to the underwriters for sale, if such securities are being sold
through underwriters, or, if such securities are not being sold through
underwriters, on the date that the registration statement with respect to such
securities becomes effective, (i) an opinion, dated as of such date, of the
counsel representing the Company for the purposes of such registration, in form
and substance as is customarily given to underwriters in an underwritten public
offering and reasonably satisfactory to a majority in interest of the Holders
requesting registration, addressed to the underwriters, if any, and to the
Holders requesting registration of Registrable Securities, and (ii) a letter
dated as of such date, from the independent certified public accountants of the
Company, in form and substance as is customarily given by independent certified
public accountants to underwriters in an underwritten public offering and
reasonably satisfactory to a majority in interest of the Holders requesting
registration, addressed to the underwriters, if any, and if permitted by
applicable accounting standards, to the Holders requesting registration of
Registrable Securities.
(h) Cause the shares offered hereunder to be listed on each
securities exchange on which similar securities issued by the Company are then
listed.
(i) 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.
3.7 Termination of Registration Rights. All registration rights granted
under this Section 2 shall terminate and be of no further force and effect four
(4) years after the date of the Company's Initial Offering. In addition, a
Holder's registration rights shall expire if (a) the Company has completed its
Initial Offering and is subject to the provisions of the Exchange Act and (b)
all Registrable Securities held by and issuable to such Holder (and its
affiliates, partners and former partners) may be sold under Rule 144 during any
ninety (90) day period.
3.8 Delay of Registration; Furnishing Information.
(a) No Holder shall have any right to obtain or seek an injunction
restraining or otherwise delaying any such registration as the result of any
controversy that might arise with respect to the interpretation or
implementation of this Section 3.
(b) It shall be a condition precedent to the obligations of the
Company to take any action pursuant to Section 3.2, 3.3 or 3.4 that the selling
Holders shall furnish to the Company such information regarding themselves, the
Registrable Securities held by them and the intended method of disposition of
such securities as shall be required to effect the registration of their
Registrable Securities.
8.
(c) The Company shall have no obligation with respect to any
registration requested pursuant to Section 3.2 or Section 3.4 if, due to the
operation of subsection 3.2(b), the number of shares or the anticipated
aggregate offering price of the Registrable Securities to be included in the
registration does not equal or exceed the number of shares or the anticipated
aggregate offering price required to originally trigger the Company's obligation
to initiate such registration as specified in Section 3.2 or Section 3.4,
whichever is applicable.
3.9 Indemnification. In the event any Registrable Securities are included
in a registration statement under Sections 3.2, 3.3 or 3.4:
(a) To the extent permitted by law, the Company will indemnify and
hold harmless each Holder, the partners, officers and directors of each Holder,
any underwriter (as defined in the Securities Act) for such Holder and each
person, if any, who controls such Holder or underwriter within the meaning of
the Securities Act or the Exchange Act, against any losses, claims, damages or
liabilities (joint or several) to which they may become subject under the
Securities Act, the Exchange Act or other federal or state law, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon any of the following statements, omissions or violations
(collectively a "Violation") by the Company: (i) any untrue statement or alleged
untrue statement of a material fact contained in such registration statement,
including any preliminary prospectus or final prospectus contained therein or
any amendments or supplements thereto; (ii) the omission or alleged omission to
state therein a material fact required to be stated therein, or necessary to
make the statements therein not misleading; or (iii) any violation or alleged
violation by the Company of the Securities Act, the Exchange Act, any state
securities law or any rule or regulation promulgated under the Securities Act,
the Exchange Act or any state securities law in connection with the offering
covered by such registration statement; and the Company will reimburse each such
Holder, partner, officer, director, underwriter or controlling person for any
legal or other expenses reasonably incurred by them in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided however, that the indemnity agreement contained in this Section 3.9(a)
shall not apply to amounts paid in settlement of any such loss, claim, damage,
liability or action if such settlement is effected without the consent of the
Company, which consent shall not be unreasonably withheld, nor shall the Company
be liable in any such case for any such loss, claim, damage, liability or action
to the extent that it arises out of or is based upon a Violation which occurs in
reliance upon and in conformity with written information furnished expressly for
use in connection with such registration by such Holder, partner, officer,
director, legal counsel, underwriter or controlling person of such Holder;
provided further, however, that the foregoing indemnity agreement with respect
to any preliminary prospectus shall not inure to the benefit of any Holder or
underwriter, or any person controlling such Holder or underwriter, from whom the
person asserting any such losses, claims, damages or liabilities purchased
shares in the offering, if a copy of the prospectus (as then amended or
supplemented if the Company shall have furnished any amendments or supplements
thereto) was not sent or given by or on behalf of such Holder or underwriter to
such person, if required by law so to have been delivered, at or prior to the
written confirmation of the sale of the shares to such person, and if the
prospectus (as so amended or supplemented) would have cured the defect giving
rise to such loss, claim, damage or liability.
(b) To the extent permitted by law, each Holder will, if Registrable
Securities held by such Holder are included in the securities as to which such
registration qualifications or compliance is being effected, indemnify and hold
harmless the Company, each of its directors, its officers, and each person, if
any, who controls the Company within the meaning of the Securities Act, any
underwriter and any other Holder selling securities under such registration
statement or any of such other Holder's partners, directors or officers or any
person who controls such Holder, against any losses, claims, damages or
liabilities (joint or several) to which the Company or any such director,
officer, controlling person, underwriter or other such Holder, or partner,
director, officer or controlling person of such other
9.
Holder may become subject under the Securities Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages or liabilities (or
actions in respect thereto) arise out of or are based upon any Violation, in
each case to the extent (and only to the extent) that such Violation occurs in
reliance upon and in conformity with written information furnished by such
Holder under an instrument duly executed by such Holder and stated to be
specifically for use in connection with such registration; and each such Holder
will reimburse any legal or other expenses reasonably incurred by the Company or
any such director, officer, controlling person, underwriter or other Holder, or
partner, officer, director, or controlling person of such other Holder in
connection with investigating or defending any such loss, claim, damage,
liability or action if it is judicially determined that there was such a
Violation; provided, however, that the indemnity agreement contained in this
Section 3.9(b) shall not apply to amounts paid in settlement of any such loss,
claim, damage, liability or action if such settlement is effected without the
consent of the Holder, which consent shall not be unreasonably withheld;
provided further, that in no event shall any indemnity under this Section 3.9(b)
exceed the net proceeds from the offering received by such Holder.
(c) Promptly after receipt by an indemnified party under this Section
3.9 of notice of the commencement of any action (including any governmental
action),such indemnified party will, if a claim in respect thereof is to be made
against any indemnifying party under this Section 3.9, deliver to the
indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent
the indemnifying party so desires, jointly with any other indemnifying party
similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party shall
have the right to retain its own counsel, with the fees and expenses to be paid
by the indemnifying party, if representation of such indemnified party by the
counsel retained by the indemnifying party would be inappropriate due to actual
or potential differing interests between such indemnified party and any other
party represented by such counsel in such proceeding. The failure to deliver
written notice to the indemnifying party within a reasonable time of the
commencement of any such action, if materially prejudicial to its ability to
defend such action, shall relieve such indemnifying party of any liability to
the indemnified party under this Section 3.9, but the omission so to deliver
written notice to the indemnifying party will not relieve it of any liability
that it may have to any indemnified party otherwise than under this Section 3.9.
(d) If the indemnification provided for in this Section 3.9 is held
by a court of competent jurisdiction to be unavailable to an indemnified party
with respect to any losses, claims, damages or liabilities referred to herein,
the indemnifying party, in lieu of indemnifying such indemnified party
thereunder, shall to the extent permitted by applicable law contribute to the
amount paid or payable by such indemnified party as a result of such loss,
claim, damage or liability 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 Violation(s) that resulted in such
loss, claim, damage or liability, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the
indemnified party shall be determined by a court of law 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; provided, that in no event shall any contribution by a
Holder hereunder exceed the proceeds from the offering received by such Holder.
(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.
10.
(f) The obligations of the Company and Holders under this Section 3.9
shall survive completion of any offering of Registrable Securities in a
registration statement and the termination of this agreement. 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.
3.10 Assignment of Registration Rights. The rights to cause the Company to
register Registrable Securities pursuant to this Section 3 may be assigned by a
Holder to a transferee or assignee of Registrable Securities which (a) is a
subsidiary, parent, general partner, limited partner or retired partner of a
Holder, (b) is a Holder's family member or trust for the benefit of an
individual Holder or (c) acquires at least one hundred fifty thousand (150,000)
shares of Registrable Securities (as adjusted for stock splits, stock dividends,
combinations, recapitalizations and the like with respect to such shares);
provided, however, (i) the transferor shall, within fifteen (15) days after such
transfer, furnish to the Company written notice of the name and address of such
transferee or assignee and the securities with respect to which such
registration rights are being assigned, (ii) such transferee shall agree in
writing to be subject to all restrictions set forth in this Agreement and (iii)
such assignment shall be effective only if immediately following such transfer
the further disposition of such securities by the transferee is restricted under
the Securities Act.
3.11 Amendment of Registration Rights. Any provision of this Section 3 may
be amended and the observance thereof may be waived (either generally or in a
particular instance and either retroactively or prospectively), only with the
written consent of the Company and the Holders of at least a majority of the
Registrable Securities then outstanding. Any amendment or waiver effected in
accordance with this Section 3.11 shall be binding upon each Holder and the
Company. By acceptance of any benefits under this Section 3, Holders of
Registrable Securities hereby agree to be bound by the provisions hereunder.
3.12 Limitation on Subsequent Registration Rights. After the date of this
Agreement, the Company shall not without the prior written consent of the
Holders of a majority of the Registrable Securities then outstanding enter into
any agreement with any holder or prospective holder of any securities of the
Company that would grant such holder registration rights senior to, or on parity
with, those granted to the Holders hereunder.
3.13 "Market Stand-Off" Agreement. Each Holder hereby agrees that it will
not, without the prior written consent of the managing underwriter, during the
period commencing on the date of the final prospectus relating to the Initial
Offering and ending on the date specified by the Company and the managing
underwriter (such period not to exceed one hundred eighty (l80) days) (a) lend,
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, or otherwise transfer or dispose of, directly or indirectly, any
shares of common stock or any securities convertible into or exercisable or
exchangeable for common stock (whether such shares or any such securities are
then owned by the Holder or are thereafter acquired), or (b) enter into any swap
or other arrangement that transfers to another, in whole or in part, any of the
economic consequences of ownership of the common stock, whether any such
transaction described in clause (a) or (b) above is to be settled by delivery of
common stock or such other securities, in cash or otherwise. The foregoing
provisions of this Section 3.13 shall not apply to (i) the sale of any shares to
the underwriters pursuant to the underwriting agreement or (ii) transactions
relating to shares of common stock or other securities acquired in the Initial
Offering or in open market transactions after the completion of the Initial
Offering. The underwriters in connection with the Initial Offering are intended
third party beneficiaries of this Section 3.13 and shall have the right, power
and authority to enforce the provisions hereof as though they were a party
hereto. In order to enforce the foregoing covenant, the
11.
Company may impose stop transfer instructions with respect to the Registrable
Securities of each Holder (and the shares or securities of every other person
subject to the foregoing restriction) until the end of such period.
3.14 Rule 144 Reporting. With a view to making available to the Holders
the benefits of certain rules and regulations of the SEC which may permit the
sale of the Registrable Securities to the public without registration, the
Company agrees to use its best efforts to:
(a) Make and keep public information available, as those terms are
understood and defined in SEC Rule 144 or any similar or analogous rule
promulgated under the Securities Act, at all times after the effective date of
the first registration filed by the Company for an offering of its securities to
the general public;
(b) File with the SEC, in a timely manner, all reports and other
documents required of the Company under the Exchange Act;
(c) So long as a Holder owns any Registrable Securities furnish to
such Holder forthwith upon request: a written statement by the Company as to its
compliance with the reporting requirements of said Rule 144 of the Securities
Act and of the Exchange Act (at any time after it has become subject to such
reporting requirements); a copy of the most recent annual or quarterly report of
the Company; and such other reports and documents as a Holder may reasonably
request in availing itself of any rule or regulation of the SEC allowing it to
sell any such securities without registration.
4. Covenants of the Company.
4.1 Basic Financial Information and Reporting.
(a) The Company will maintain true books and records of account in
which full and correct entries will be made of all its business transactions
pursuant to a system of accounting established and administered in accordance
with generally accepted accounting principles consistently applied and will set
aside on its books all such proper accruals and reserves as shall be required
under generally accepted accounting principles consistently applied;
(b) As soon as practicable after the end of each fiscal year of the
Company, and in any event within one hundred twenty (120) days thereafter, the
Company will furnish each Investor a consolidated balance sheet of the Company,
as at the end of such fiscal year, and a consolidated statement of income and
statement of shareholder's equity as of the end of such year, and a consolidated
statement of cash flows of the Company, for such year, all prepared in
accordance with generally accepted accounting principles consistently applied
and setting forth in each case in comparative form the figures for the previous
fiscal year, all in reasonable detail. Such financial statements shall be
accompanied by a report and opinion thereon by independent public accountants of
national standing selected by the Company's Board of Directors;
(c) The Company will furnish each Investor, as soon as practicable
after the end of the first, second and third quarterly accounting periods in
each fiscal year of the Company, and in any event within forty-five (45) days
thereafter, a consolidated balance sheet of the Company as of the end of each
such quarterly period, and a consolidated statement of income and a consolidated
statement of cash flows of the Company for such period and for the current
fiscal year to date, prepared in accordance with generally accepted accounting
principles, with the exception that no notes need be attached to such statements
and year-end audit adjustments may not have been made;
12.
(d) As long as an Investor, together with its affiliates, holds five
hundred thousand shares (500,000) of Series B Stock, Series C Stock and/or
Series D Stock (as adjusted for stock splits, dividends, combinations,
recapitalizations and the like with respect to such shares) (the "Major
Investor"), as soon as practicable, but in any event at least thirty (30) days
prior to the end of each fiscal year, a budget and business plan for the next
fiscal year, prepared on a monthly basis, including balance sheets, income
statements and statements of cash flows for such months and, as soon as
prepared, any other budgets or revised budgets prepared by the Company; and
(e) Such other information relating to the financial condition,
business, prospects or corporate affairs of the Company as the Investor or any
assignee of the Investor may from time to time request, provided, however, that
the Company shall not be obligated under this subsection (e) or any other
subsection of Section 4.1 to provide information that it deems in good faith to
be a trade secret or similar confidential information.
4.2 Inspection Rights. Each Investor shall have the right to visit and
inspect any of the properties of the Company or any of its subsidiaries, and to
discuss the affairs, finances and accounts of the Company or any of its
subsidiaries with its officers, and to review such information as is reasonably
requested all at such reasonable times and as often as may be reasonably
requested; provided, however, that the Company shall not be obligated under this
Section 4.2 to provide such access for any competitor of the Company or to any
information which the Board of Directors determines in good faith is
confidential and should not, therefore, be disclosed.
4.3 Confidentiality of Records. Each Investor agrees to use and to use its
best efforts to insure that its authorized representatives use the same degree
of care as such Investor uses to protect its own confidential information to
keep confidential any information furnished to it which the Company identifies
as being confidential or proprietary (so long as such information is not in the
public domain), except that such Investor may disclose such proprietary or
confidential information to any partner, subsidiary or parent of such Investor
for the purpose of evaluating its investment in the Company as long as such
partner, subsidiary or parent is advised of the confidentiality provisions of
this Section 4.3.
4.4 Reservation of Common Stock. The Company will at all times reserve and
keep available, solely for issuance and delivery upon the conversion of the
Series A Stock, Series A1 Stock, Series B Stock, Series C Stock and/or Series D
Stock, all common stock issuable from time to time upon such conversion.
4.5 Termination of Covenants. All covenants of the Company contained in
Section 4 of this Agreement shall expire and terminate as to each Investor on
the effective date of the registration statement pertaining to the Initial
Offering.
5. Rights of First Refusal.
5.1 Subsequent Offerings. So long as an Investor (with its affiliates)
holds at least one hundred thousand shares (100,000) of preferred stock (as
adjusted for stock splits, stock dividends, combinations, recapitalizations and
the like with respect to such shares) (a "Major Investor"), such Major Investor
shall have a right of first refusal to purchase its pro rata share of all Equity
Securities, as defined below, that the Company may, from time to time, propose
to sell and issue after the date of this Agreement, other than the Equity
Securities excluded by Section 5.6 hereof. Each Major Investor's pro rata share
is equal to the ratio of (a) the number of shares of the Company's common stock
(including all shares of common stock issued or issuable upon conversion of the
Shares) which such Major Investor is deemed to be a holder immediately prior to
the issuance of such Equity Securities to (b) the total number
13.
of shares of the Company's outstanding common stock (including all shares of
common stock issued or issuable upon conversion of the Shares or upon the
exercise of any outstanding warrants or options) immediately prior to the
issuance of the Equity Securities. The term "Equity Securities" shall mean (i)
any common stock, preferred stock or other security of the Company, (ii) any
security convertible, with or without consideration, into any common stock,
preferred stock or other security (including any option to purchase such a
convertible security), (iii) any security carrying any warrant, option or right
to subscribe to or purchase any common stock, preferred stock or other security
and (iv) any such warrant, option or right.
5.2 Exercise of Rights. If the Company proposes to issue any Equity
Securities, it shall give each Major Investor written notice of its intention,
describing the Equity Securities, the price and the terms and conditions upon
which the Company proposes to issue the same. Each Major Investor shall have
twenty (20) days from the giving of such notice to agree to purchase its pro
rata share of the Equity Securities for the price and upon the terms and
conditions specified in the notice by giving written notice to the Company and
stating therein the quantity of Equity Securities to be purchased.
Notwithstanding the foregoing, the Company shall not be required to offer or
sell such Equity Securities to any Major Investor who would cause the Company to
be in violation of applicable federal or state securities laws by virtue of such
offer or sale.
5.3 Issuance of Equity Securities to Other Persons. If not all of the
Major Investors elect to purchase their pro rata share of the Equity Securities,
then the Company shall promptly notify in writing the Major Investors who do so
elect and shall offer such Major Investors the right to acquire such
unsubscribed shares. The Major Investors shall have ten (10) days after receipt
of such notice to notify the Company of its election to purchase all or a
portion thereof of the unsubscribed shares. If the Major Investors fail to
exercise in full the rights of first refusal, the Company shall have one hundred
twenty (120) days thereafter to sell the Equity Securities in respect of which
the Major Investor's rights were not exercised at a price and upon general terms
and conditions materially no more favorable to the purchasers thereof than
specified in the Company's notice to the Major Investors pursuant to Section 5.2
hereof. If the Company has not sold such Equity Securities within one hundred
twenty (120) days of the notice provided pursuant to Section 5.2, the Company
shall not thereafter issue or sell any Equity Securities without first offering
such securities to the Major Investors in the manner provided above.
5.4 Termination and Waiver of Rights of First Refusal. The rights of first
refusal established by this Section 5 shall not apply to and shall terminate
upon the effective date of the registration statement pertaining to the
Company's Initial Offering. The rights of first refusal established in this
Section 5 may be amended or any provision waived with the written consent of the
Major Investors holding a majority of the Registrable Securities held by all
Major Investors outstanding on the date of such amendment or such waiver.
5.5 Transfer of Rights of First Refusal. The rights of first refusal of
each Major Investor under this Section 5 may be transferred to the same parties,
subject to the same restrictions as any transfer of registration rights pursuant
to Section 3.10.
5.6 Excluded Securities. The rights of first refusal established by this
Section 5 shall have no application to any of the following Equity Securities:
(a) shares of common stock (and/or options, warrants or other common
stock purchase rights issued pursuant to such options, warrants or other rights)
issued or to be issued to employees, officers or directors of, or consultants or
advisors to the Company or any subsidiary for the primary purpose of soliciting
or retaining their services, pursuant to stock purchase or stock option plans or
other arrangements that are approved by the Board of Directors;
14.
(b) stock issued pursuant to any rights or agreements outstanding as
of the date of this Agreement, options and warrants outstanding as of the date
of this Agreement; and stock issued pursuant to any such rights or agreements
granted after the date of this Agreement, provided that the rights of first
refusal established by this Section 5 applied with respect to the initial sale
or grant by the Company of such rights or agreements;
(c) any Equity Securities issued for consideration other than cash
pursuant to a merger, consolidation, acquisition or similar business combination
that are approved by the Board of Directors;
(d) shares of common stock issued in connection with any stock split,
stock dividend or recapitalization by the Company;
(e) shares of common stock issued upon conversion of the Shares;
(f) any Equity Securities issued pursuant to any equipment leasing
arrangement, or commercial credit arrangement from a bank or similar financial
institution or in connection with development of licensing transactions with
third party operating companies;
(g) any Equity Securities that are issued by the Company in its
Initial Offering; and
(h) any shares of Series D Stock sold pursuant to the Purchase
Agreement.
6. Miscellaneous.
6.1 Governing Law. This Agreement shall be governed by and construed under
the laws of the State of California as applied to agreements among California
residents entered into and to be performed entirely within California.
6.2 Survival. The representations, warranties, covenants and agreements
made herein shall survive any investigation made by any Holder and the closing
of the transactions contemplated hereby. All statements as to factual matters
contained in any certificate or other instrument delivered by or on behalf of
the Company pursuant hereto in connection with the transactions contemplated
hereby shall be deemed to be representations and warranties by the Company
hereunder solely as of the date of such certificate or instrument.
6.3 Successors and Assigns. Except as otherwise expressly 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
and shall inure to the benefit of and be enforceable by each person who shall be
a holder of Registrable Securities from time to time; provided, however, that
prior to the receipt by the Company of adequate written notice of the transfer
of any Registrable Securities specifying the full name and address of the
transferee, the Company may deem and treat the person listed as the holder of
such shares in its records as the absolute owner and holder of such shares for
all purposes, including the payment of dividends or any redemption price.
6.4 Entire Agreement. This Agreement, the Exhibits and Schedules hereto,
the Purchase Agreement and the other documents delivered pursuant thereto
constitute the full and entire understanding and agreement between the parties
with regard to the subjects hereof and no party shall be liable or bound to any
other in any manner by any representations, warranties, covenants and agreements
except as specifically set forth herein and therein.
15.
6.5 Severability. In case any provision of the Agreement shall be invalid,
illegal, or unenforceable, the validity, legality, and enforceability of the
remaining provisions shall not in any way be affected or impaired thereby.
6.6 Amendment and Waiver. Any term of this Agreement may be amended and
the observance of any term of this Agreement may be waived (either generally or
in a particular instance and either retroactively or prospectively), only with
the written consent of the Company and the holders of a majority of the
Registrable Securities then outstanding; provided, however, that in the event
that such amendment or waiver adversely affects the obligations and/or rights of
any such Holders in a different manner than the other Holders, such amendment or
waiver shall also require the written consent of a majority in interest of such
Holders adversely affected. Any amendment or waiver effected in accordance with
this paragraph shall be binding upon each holder of any Registrable Securities,
each future holder of all such Registrable Securities, and the Company.
6.7 New Investors. Notwithstanding anything herein to the contrary, if
pursuant to Section 2.3 of the Purchase Agreement, additional parties purchase
shares of Series D Stock, then each such new investor shall become a party to
this Agreement as an "Investor" hereunder, without the need for any consent,
approval or signature of any Investor when such new investor has both: (a)
purchased shares of Series D Stock under the Purchase Agreement and paid the
Company all consideration payable for such shares; and (b) executed one or more
counterpart signature pages to this Agreement as an "Investor" with the
Company's consent.
6.8 Delays or Omissions. It is agreed that no delay or omission to
exercise any right, power, or remedy accruing to any Holder, upon any breach,
default or noncompliance of the Company under this Agreement shall impair any
such right, power or remedy nor shall it be construed to be a waiver of any such
breach, default or noncompliance nor any acquiescence therein nor of any similar
breach, default or noncompliance thereafter occurring. It is further agreed that
any waiver, permit, consent or approval of any kind or character on any Holder's
part of any breach, default or noncompliance under the Agreement or any waiver
on such Holder's part of any provisions or conditions of this Agreement must be
in writing and shall be effective only to the extent specifically set forth in
such writing. All remedies, either under this Agreement, by law or otherwise
afforded to Holders shall be cumulative and not alternative.
6.9 Notices. All notices required or permitted hereunder shall be in
writing and shall be deemed effectively given: (a) upon personal delivery to the
party to be notified; (b) when sent by confirmed telex or facsimile if sent
during normal business hours of the recipient; if not, then on the next business
day; (c) five days after having been sent by registered or certified mail,
return receipt requested, postage prepaid; or (d) one day after deposit with a
nationally recognized overnight courier, specifying next day delivery, with
written verification of receipt. All communications shall be sent to the party
to be notified at the address as set forth on Exhibit A hereto with regard to
the Investors, the address as set forth on the signature page hereto with regard
to the Company or at such other address as such party may designate by ten (10)
days advance written notice to the other parties hereto.
6.10 Attorneys' Fees. In the event that any dispute among the parties to
this Agreement should result in litigation, the prevailing party in such dispute
shall be entitled to recover from the losing party all fees, costs and expenses
of enforcing any right of such prevailing party under or with respect to this
Agreement, including, without limitation, such reasonable fees and expenses of
attorneys and accountants, which shall include, without limitation, all fees,
costs and expenses of appeals.
6.11 Titles and Subtitles. The titles of the sections and subsections of
this Agreement are for convenience of reference only and are not to be
considered in construing this Agreement.
16.
6.12 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
6.13 Aggregation of Stock. All shares of Registrable 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.
[THE REST OF THIS PAGE IS INTENTIONALLY LEFT BLANK.]
17.
In Witness Whereof, the parties hereto have executed this Second Amended
and Restated Investor Rights Agreement as of the date set forth in the first
paragraph hereof.
COMPANY: INVESTORS:
Vitria Technology, Inc. __________________________________
000 Xxxxx Xxxxxx [Name of Investor]
Xxxxxxxx Xxxx, XX 00000
By:_______________________________
By:________________________________ Title:____________________________
XxXxx Xxxxx, President
Weston Presidio Capital II, L.P.
By:_______________________________
Title:____________________________
Xxxxxx Xxxx Ventures, A California
Limited Partnership
By:_______________________________
General Partner of the General
Partner
Xxxxxx Hill Associates, L.P.
By:_______________________________
General Partner
Xxxxx Fargo Bank, Trustee
SHV M/P/T Xxxxxxx X. Xxxxxxx
By:_______________________________
Title:____________________________
Second Amended and Restated Investors Rights Agreement
Signature Page
Brentwood Associates VIII, L.P.
By Brentwood VIII Ventures, L.L.C.
Its General Partner
By:_______________________________
General Partner
Brentwood Affiliates Fund, L.P.
By Brentwood VIII Ventures, L.P.
Its General Partner
By:_______________________________
General Partner
Integral Capital Partners III, L.P.
By Integral Capital Management III,
L.P.
Its General Partner
By:_______________________________
a General Partner
Integral Capital Partners
International III, L.P.
By Integral Capital Management III,
L.P.
Its Investment General Partner
By:_______________________________
a General Partner
Second Amended and Restated Investors Rights Agreement
Signature Page
Stanford University
By:_______________________________
Title:____________________________
__________________________________
XxXxx Xxxxx
__________________________________
Xxxx Xxxxx
__________________________________
Xxxxxx Xxxxxxxx
__________________________________
Xxxxx Xxxxxxxx Dow
__________________________________
Xxxx X. Xxxxxxxx
__________________________________
Xxxxx Xxxx Xxxxxxxx Trust
__________________________________
Xxxxxx Xxxxxx Halperin Trust
__________________________________
Xxxxxx Xxxxxx Xxxxxxxx Trust
__________________________________
Xxxxx Fargo Bank, Trustee
SHV M/P/T FBO Xxxxx Xxxx
Second Amended and Restated Investors Rights Agreement
Signature Page
TOW Partners, A California Limited
Partnership
By:_______________________________
Title:____________________________
Xxxx X. and Xxxxxx X. Xxxxxx,
Trustees of the Wythes Living Trust
By:_______________________________
Title:____________________________
Xxxxx X. Xxxxxxxx, Trustee, The
Xxxxxxxx Living Trust, U/A/D
1/22/98
By:_______________________________
Title:____________________________
Anvest, L.P.
By:_______________________________
Title:____________________________
__________________________________
G. Xxxxxxx Xxxxx, Xx.
Xxxxxxx X. Xxxxxxx, Xx., Trustee,
The Younger Living Trust, U/A/D
1/20/95
By:_______________________________
Title:____________________________
Second Amended and Restated Investors Rights Agreement
Signature Page
__________________________________
Xxxxxxx X. Xxxxx
Xxxxxxxx Holdings, L.P.
By:_______________________________
Title:____________________________
Xxxxx Xxxx, Trustee, The Xxxx/Otus
Revocable Trust
By:_______________________________
Title:____________________________
__________________________________
Xxxxxxx Xxxx
ML IBK Positions, Inc.
By:_______________________________
Title:____________________________
Second Amended and Restated Investors Rights Agreement
Signature Page
VITRIA TECHNOLOGY, INC.
SECOND AMENDED AND RESTATED
INVESTOR RIGHTS AGREEMENT
Dated: May 20, 1999
Table of Contents
Page
1. Amendment and Restatement of Prior Agreement.1
1.1 Amendment and Restatement.................................... 1
2. General........................................................... 2
2.1 Definitions.................................................. 2
3. Registration; Restrictions on Transfer............................ 3
3.1 Restrictions on Transfer.................................... 3
3.2 Demand Registration......................................... 4
3.3 Piggyback Registrations..................................... 5
3.4 Form S-3 Registration....................................... 6
3.5 Expenses of Registration.................................... 7
3.6 Obligations of the Company.................................. 7
3.7 Termination of Registration Rights.......................... 8
3.8 Delay of Registration; Furnishing Information............... 8
3.9 Indemnification............................................. 9
3.10 Assignment of Registration Rights........................... 11
3.11 Amendment of Registration Rights............................ 11
3.12 Limitation on Subsequent Registration Rights................ 11
3.13 "Market Stand-Off" Agreement................................ 11
3.14 Rule 144 Reporting.......................................... 12
4. Covenants of the Company.......................................... 12
4.1 Basic Financial Information and Reporting................... 12
4.2 Inspection Rights........................................... 13
4.3 Confidentiality of Records.................................. 13
4.4 Reservation of Common Stock................................. 13
4.5 Termination of Covenants.................................... 13
5. Rights of First Refusal........................................... 13
5.1 Subsequent Offerings........................................ 13
5.2 Exercise of Rights.......................................... 14
5.3 Issuance of Equity Securities to Other Persons.............. 14
5.4 Termination and Waiver of Rights of First Refusal........... 14
5.5 Transfer of Rights of First Refusal......................... 14
5.6 Excluded Securities......................................... 14
i.
Table of Contents
(continued)
Page
6. Miscellaneous..................................................... 15
6.1 Governing Law............................................... 15
6.2 Survival.................................................... 15
6.3 Successors and Assigns...................................... 15
6.4 Entire Agreement............................................ 15
6.5 Severability................................................ 16
6.6 Amendment and Waiver........................................ 16
6.7 New Investors............................................... 16
6.8 Delays or Omissions......................................... 16
6.9 Notices..................................................... 16
6.10 Attorneys' Fees............................................. 16
6.11 Titles and Subtitles........................................ 17
6.12 Counterparts................................................ 17
6.13 Aggregation of Stock........................................ 17
ii.
SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT
Exhibit A
SCHEDULE OF INVESTORS
Name
----
Xxxxx X. Xxxxxxxx, Trustee, The Xxxxxxxx
Living Trust, U/A/D 1/22/98
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
Anvest, L.P.
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
G. Xxxxxxx Xxxxx, Xx.
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
Brentwood Affiliates Fund, L.P.
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
Brentwood Associates VIII, L.P.
0000 Xxxx Xxxx Xxxx
Xxxxxxxx 0, Xxxxx 000
Xxxxx Xxxx, XX 00000
XxXxx Xxxxx
0000 Xxxxxxxx Xxxxx
Xxxx Xxxx, XX 00000
GC&H Investments
Xxx Xxxxxxxx Xxxxx
00/xx/ Xxxxx
Xxx Xxxxxxxxx, XX 00000
Xxxxx Xxxxxxxx Dow
c/o Xxxxxx X. Xxxxxxxx, Attorney-in-fact
00 Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Second Amended and Restated Investors Rights Agreement
Exhibit A
SCHEDULE OF INVESTORS
Name
----
Xxxxxx Xxxxxx Xxxxxxxx Trust
c/o Xxxxxx X. Xxxxxxxx, Attorney-in-fact
00 Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Xxxx X. Xxxxxxxx
c/o Xxxxxx X. Xxxxxxxx, Attorney-in-fact
00 Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Xxxxxx Xxxxxxxx
00 Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Xxxxxx Xxxxxx Xxxxxxxx Trust
c/o Xxxxxx X. Xxxxxxxx, Attorney-in-fact
00 Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Xxxxx Xxxx Xxxxxxxx Trust
c/o Xxxxxx X. Xxxxxxxx, Attorney-in-fact
00 Xxxxxxxxx Xxxx
Xxxxxxxx, XX 00000
Integral Capital Partners III, L.P.
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Integral Capital Partners International III, L.P.
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
ML IBK Positions, Inc.
0000 Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxx Xxxx, XX 00000
Xxxxxxx X. Xxxxx
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
Xxxx Xxxxx
0000 Xxxxxxxx Xxxxx
Xxxx Xxxx, XX 00000
Second Amended and Restated Investors Rights Agreement
Exhibit A
SCHEDULE OF INVESTORS
Name
----
Stanford University
0000 Xxxx Xxxx Xxxx
Xxxxx Xxxx, XX 00000
Xxxxxx Xxxx Ventures, A California Limited Partnership
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
Xxxxxx Hill Associates, L.P.
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
TOW Partners, A California Limited Partnership
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
Xxxxx Fargo Bank, Trustee SHV M/P/T Xxxxx Xxxx
000 Xxxxxxxxxx Xxxxxx, 0/xx/ Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Xxxxx Fargo Bank, Trustee SHV M/P/T Xxxxxxx X. Xxxxxxx
MAC #0101-021
000 Xxxxxxxxxx Xxxxxx, 0/xx/ Xxxxx
Xxx Xxxxxxxxx, XX 00000
Attention: Xxxxx Xxxxxx
Xxxxxx Presidio Capital II, L.P.
000 Xxxxxxx Xxxxxx
Xxxxx 0000
Xxx Xxxxxxxxx, XX 00000-0000
Xxxx X. and Xxxxxx X. Xxxxxx, Trustees,
The Wythes Living Trust
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
Second Amended and Restated Investors Rights Agreement
Exhibit A
SCHEDULE OF INVESTORS
Name
----
Xxxxxxx X. Xxxxxxx, Xx., Trustee,
The Younger Living Trust, U/A/D 1/20/95
000 Xxxx Xxxx Xxxx
Xxxxx X-000
Xxxx Xxxx, XX 00000
Xxxxxxxx Holdings, L.P.
000 Xxxx Xxxx Xxxx, Xxxxx X-000
Xxxx Xxxx, XX 00000
Xxxxx Xxxx, Trustee
The Xxxx/Otus Revocable Trust
000 Xxxx Xxxx Xxxx, Xxxxx X-000
Xxxx Xxxx, XX 00000
Xxxxxxx Xxxx
000 Xxxx Xxxx Xxxx, Xxxxx X-000
Xxxx Xxxx, XX 00000
Second Amended and Restated Investors Rights Agreement
Exhibit A
