EX-10.21 21 d403225dex1021.htm EX-10.21
Exhibit 10.21
THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.
WARRANT TO PURCHASE STOCK
Company: | ROKU, INC., a Delaware corporation | |
Number of Shares: | as set forth below | |
Class of Stock: | as set forth below | |
Warrant Price: | as set forth below | |
Issue Date: | April 27, 2012 | |
Expiration Date: | The 10th anniversary after the Issue Date | |
Credit Facility: | Loan and Security Agreement among the Company, Silicon Valley Bank and Gold Hill Capital 2008, LP dated April 27, 2012 (as amended from time to time, the “Loan Agreement”). |
THIS WARRANT CERTIFIES THAT, for good and valuable consideration, GOLD HILL CAPITAL 2008, LP (“Gold Hill”, together with any registered holder from time to time of this Warrant or any holder of the shares issuable or issued upon exercise of this Warrant, “Holder”) is entitled to purchase the number of fully paid and nonassessable shares of the Class of Stock (the “Shares”) of the Company at the Warrant Price, all as set forth above and as adjusted pursuant to Article 2 of this Warrant, subject to the provisions and upon the terms and conditions set forth in this Warrant.
As used herein:
“Class of Stock” means Next Round Stock; provided, however, that if an Acquisition (as defined in Section 1.6.1) occurs prior to the Next Round, the Class of Stock shall be Series D Preferred Stock.
“Next Round” means the Company’s next sale of its convertible preferred stock after the Issue Date (other than Series D Preferred Stock) to purchasers which include venture capital investors.
“Next Round Price” means the lowest price per share at which shares of the Company’s convertible preferred stock are sold in the Next Round.
“Next Round Stock” means the Company’s convertible preferred stock issued and sold in the Next Round.
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“Number of Shares” means the number of shares of the Class of Stock equal to (i) Three Hundred Thousand Dollars ($300,000), divided by (ii) the Warrant Price.
“Series D Price” means $0.3964 per share (subject to adjustment pursuant to the Company’s Amended and Restated Certificate of Incorporation in effect on the date hereof).
“Warrant Price” means (a) if the Class of Stock is Series D Preferred Stock, the Series D Price, and (ii) if the Class of Stock is Next Round Stock, eighty percent (80%) of Next Round Price.
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1.6 Treatment of Warrant Upon Acquisition of Company; Treatment After IPO.
1.6.1 “Acquisition”. For the purpose of this Warrant, “Acquisition” means any sale, license, or other disposition of all or substantially all of the assets of the Company, or any reorganization, consolidation, or merger of the Company where the holders of the Company’s securities before the transaction beneficially own less than 50% of the outstanding voting securities of the surviving entity after the transaction.
1.6.2 Treatment of Warrant at Acquisition.
A) Upon the written request of the Company, Xxxxxx agrees that, in the event of an Acquisition in which the sole consideration is cash and the Company does not continue as a going concern, either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will expire upon the consummation of such Acquisition. The Company shall provide Holder with written notice of its request relating to the foregoing (together with such reasonable information as Holder may request in connection with such contemplated Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the closing of the proposed Acquisition.
B) Upon the written request of the Company, Xxxxxx agrees that, in the event of a (a) stock for stock Acquisition of the Company by a publicly traded acquirer or (b) combination of cash and stock for stock Acquisition of the Company by a publicly traded acquirer, if, on the record date for the Acquisition, the fair market value of the Shares (or other securities issuable upon exercise of this Warrant) is equal to or greater than four (4) times the Warrant Price, the Company may require the Warrant to be deemed automatically exercised and the Holder shall participate in the Acquisition as a holder of the Shares (or other securities issuable upon exercise of the Warrant) on the same terms as other holders of the same class of securities of the Company.
C) Upon written request of the Company, Xxxxxx agrees that, upon the third (3rd) anniversary of the date of an IPO, either (a) Holder shall exercise its conversion or purchase right under this Warrant or (b) if Holder elects not to exercise this Warrant, this Warrant will expire upon such (3rd) anniversary date subject to Article 5.8.
D) Upon the closing of any Acquisition other than those particularly described in subsections (A) and (B) above, the successor entity shall assume the obligations of this Warrant, and this Warrant shall be exercisable for the same securities, cash, and
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property as would be payable for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing. The Warrant Price and/or number of Shares shall be adjusted accordingly.
ARTICLE 2. ADJUSTMENTS TO THE SHARES.
2.2 Reclassification, Exchange, Combinations or Substitution. Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event. Such an event shall include any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the Company’s Certificate of Incorporation upon the closing of a registered public offering of the Company’s common stock, but shall not include any conversions or reclassifications as a result of a failure to participate in any equity financings of the Company or any “right of first offer” or other pay to play provisions set forth in the Company’s Certificate of Incorporation as set forth in Article 2.4. The Company or its successor shall promptly issue to Holder an amendment to this Warrant setting forth the number and kind of such new securities or other property issuable upon exercise or conversion of this Warrant as a result of such reclassification, exchange, substitution or other event that results in a change of the number and/or class of securities issuable upon exercise or conversion of this Warrant. The amendment to this Warrant shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant. The provisions of this Article 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.
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and as of the date of any such required adjustment. The provisions set forth for the Shares in the Company’s Certificate of Incorporation relating to the above in effect as of the Issue Date may not be amended, modified or waived, without the prior written consent of Holder unless such amendment, modification or waiver affects the rights associated with the Shares in the same manner as such amendment, modification or waiver affects the rights associated with all other shares of the same series and class as the Shares granted to Holder.
2.4 “Pay to Play”. So long as any portion of this Warrant remains unexercised, in the event that any “pay to play” terms or conditions (i.e. terms or conditions that require a holder of the Company’s Preferred Stock to purchase securities in a future round of equity financing or else lose the benefit of antidilution protection applicable to the shares of Preferred Stock issuable upon the exercise of this Warrant or have such shares of Preferred Stock automatically convert to common stock or convert to another class and series of the Company’s capital stock) in the Company’s Certificate of Incorporation, are triggered in connection with the consummation of a Down Round (as defined below) or otherwise after the date hereof, then in such event, this Warrant shall automatically adjust to provide the Holder with the same securities and/or rights that the Holder would have received had the Holder participated in the Down Round to its full pro rata share with respect to the Preferred Stock issuable upon exercise of this Warrant (e.g., if this Warrant provides for the purchase of Series D Preferred Stock, and the Company after the date hereof consummates a Down Round in which those holders of Series D Preferred Stock who participate to their full pro rata share in such Down Round become entitled to exchange such Series D Preferred Stock for Series D-1 Preferred Stock and those holders of Series D Preferred Stock who do not participate to their full pro rata share will have their Series D Preferred Stock converted into Common Stock, then this Warrant would automatically adjust to provide the right to purchase Series D-1 Preferred Stock instead of Common Stock). A “Down Round” means any non-public offering of equity securities of the Company after the Issue Date of this Warrant at a price per share lower than the Warrant Price then in effect.
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Company’s expense, promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based. The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant Price in effect upon the date thereof and the series of adjustments leading to such Warrant Price.
ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.
3.1 Representations and Warranties. The Company represents and warrants to Holder as follows:
(a) The Series D Price is the “Original Issue Price” of the Company’s Series D Preferred Stock as defined in the Company’s Amended and Restated Certificate of Incorporation in effect on the date hereof.
(b) All Shares which may be issued upon the exercise of the purchase right represented by this Warrant, and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.
(c) The Company’s capitalization table attached hereto as Schedule 1 is true and complete as of the Issue Date.
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the Company, such common stock, shall have certain “piggyback” and “S-3” registration rights pursuant to and as set forth in the Company’s Amended and Restated Investor Rights Agreement dated August 1, 2011 (the “Rights Agreement”), provided Xxxxxx becomes a party to the Rights Agreement if it is not already a party thereto. The provisions set forth in the Company’s Rights Agreement relating to the above in effect as of the Issue Date may not be amended, modified or waived without the prior written consent of Holder unless such amendment, modification or waiver affects the rights associated with the Shares in the same manner as such amendment, modification, or waiver affects the rights associated with all other shares of the same series and class as the Shares granted to Holder.
4.4 Accredited Investor Status. Holder is an “accredited investor” within the meaning of Regulation D promulgated under the Act.
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Holder understands that this Warrant and the Shares issued upon any exercise or conversion hereof must be held indefinitely unless subsequently registered under the Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available.
THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.
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Gold Hill to provide an opinion of counsel if the transfer is to any affiliate of Gold Hill. Additionally, the Company shall also not require an opinion of counsel if there is no material question as to the availability of current information as referenced in Rule 144(c), Holder represents that it has complied with Rule 144(d) and (e) in reasonable detail, the selling broker represents that it has complied with Rule 144(f), and the Company is provided with a copy of Holder’s notice of proposed sale. Notwithstanding anything to the contrary contained in this Warrant, without the prior written consent of the Company, this Warrant may not be transferred in part unless: (a) the transferee acquires the right to purchase at least 25% of the total number of Shares purchasable under this Warrant (as adjusted pursuant to Article 2), or (b) the transfer is to an affiliated fund of Gold Hill.
Gold Hill Capital 2008, LP
Xxx Xxxxxxx Xxxx., Xxxxx 000
San Jose, CA 95113
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Notice to the Company shall be addressed as follows until Xxxxxx receives notice of a change in address:
ROKU, INC.
Attn: Xxxxxxx Xxxx and Xxxxxx Xxxxxx
00000 Xxxxxxxx Xxx., Xxxxx X
Saratoga, CA 95070
Facsimile: (000) 000-0000
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5.10 Governing Law. This Warrant shall be governed by and construed in accordance with the laws of the State of California, without giving effect to its principles regarding conflicts of law.
[Signature page follows.]
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“COMPANY”
ROKU, INC. | ||||||
By: | /s/ Xxxxxxx Xxxx | By: | /s/ Xxxxxx X. Xxxxxx | |||
Name: | Xxxxxxx Xxxx | Name: | Xxxxxx X. Xxxxxx (Print) | |||
Title: | President and CEO | Title: | Chief Financial Officer | |||
“HOLDER” | ||
GOLD HILL CAPITAL 2008, LP | ||
By: Gold Hill Capital 2008, LLC, General Partner | ||
By: | /s/ Xxxx Xxxx | |
Name: | Xxxx Xxxx (Print) | |
Title: | Associate, Gold Hill Capital |
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SCHEDULE 1
CAPITALIZATION TABLE
[See attached.]
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APPENDIX 1
NOTICE OF EXERCISE
1. Holder elects to purchase shares of the Common/Series Preferred [strike one] Stock of ROKU, INC. pursuant to the terms of the attached Warrant, and tenders payment of the purchase price of the shares in full.
[or]
1. Holder elects to convert the attached Warrant into Shares/cash [strike one] in the manner specified in the Warrant. This conversion is exercised for of the Shares covered by the Warrant.
[Strike paragraph that does not apply.]
2. Please issue a certificate or certificates representing the shares in the name specified below:
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Holder’s Name | ||||
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3. By its execution below and for the benefit of the Company, Holder hereby restates each of the representations and warranties in Article 4 of the Warrant as the date hereof.
HOLDER:
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By: |
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Name: |
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Title: |
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(Date): |
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APPENDIX 2
For value received, Gold Hill Capital 2008, LP hereby sells, assigns and transfers unto
Name:
Address:
Tax ID:
that certain Warrant to Purchase Stock issued by ROKU, INC. (the “Company”), on , 2012 (the “Warrant”) together with all rights, title and interest therein.
GOLD HILL CAPITAL 2008, LP |
By: |
Name: |
Title: |
Date:
By its execution below, and for the benefit of the Company, makes each of the representations and warranties set forth in Article 4 of the Warrant and agrees to all other provisions of the Warrant as of the date hereof.
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By: |
Name: |
Title: |
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