SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT BY AND AMONG MAKO SURGICAL CORP. AND EACH OF THE STOCKHOLDERS LISTED ON EXHIBIT B AND THE ADDITIONAL STOCKHOLDERS FROM TIME TO TIME PARTY HERETO FEBRUARY 6, 2007 As amended March 5, 2007
Exhibit 4.4
SECOND AMENDED AND RESTATED
BY AND AMONG
AND
EACH OF THE STOCKHOLDERS LISTED ON EXHIBIT B
AND THE ADDITIONAL STOCKHOLDERS
FROM TIME TO TIME PARTY HERETO
AND THE ADDITIONAL STOCKHOLDERS
FROM TIME TO TIME PARTY HERETO
FEBRUARY 6, 2007
As amended March 5, 2007
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
THIS SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT (this “Agreement”) is entered
into as of February 6, 2007 (the “Effective Date”) by and among (i) MAKO Surgical Corp., a
Delaware corporation (the “Company”); (ii) each of the individuals and entities from time
to time identified as a “Series A Investor Stockholder” in Exhibit B hereto (each
individually, a “Series A Investor Stockholder”, and collectively, the “Series A Investor
Stockholders”); (iii) each of the individuals and entities from time to time identified as a
“Series B Investor Stockholder” in Exhibit B hereto (each individually, a “Series B
Investor Stockholder”, and collectively, the “Series B Investor Stockholders”); (iv)
each of the individuals and entities from time to time identified as a “Series C Investor
Stockholder” in Exhibit B hereto (each individually, a “Series C Investor
Stockholder”, and collectively, the “Series C Investor Stockholders”); (v) Z-KAT, Inc.,
a Florida corporation (“Z-KAT”), Xxxx Xxxxx, MD, Ph.D., an individual (“Xx.
Xxxxx”), Xxxxxxxx Xxxxxx, Ph.D. MBA, an individual (“Xx. Xxxxxx”), Xxxxxxx X. Xxxxx, MD
(“Xx. Xxxxx”), Xxxxxx X. Xxxxx (collectively, the “Existing Common Stockholders”);
and (vi) each of the Additional Stockholders (as hereinafter defined) from time to time becoming
party to this Agreement in accordance with the provisions of Section 3.1.1 below. The
Series A Investor Stockholders, the Series B Investor Stockholders, the Series C Investor
Stockholders, the Existing Common Stockholders and the Additional Stockholders (as hereinafter
defined) and any other persons who shall hereafter acquire Equity Securities (as hereinafter
defined) of the Company pursuant to the provisions of, and subject to the restrictions and rights
set forth in, this Agreement along with their respective successors or permitted transferees or
assignees from time to time, are referred to herein collectively as the “Company
Stockholders” and each individually as a “Company Stockholder”.
WHEREAS, the Company, Z-Kat, Xx. Xxxxx, Xx. Xxxxxx and the Series A Investor Stockholders are
parties to that certain Stockholders Agreement dated December 17, 2004 (the “Original
Agreement”), which was executed simultaneous with the execution of that certain Stock Purchase
Agreement (the “Series A Purchase Agreement”) for the purchase and sale of the Company’s
Series A Convertible Preferred Stock (the “Series A Preferred Stock”), by and among certain
Series A Investor Stockholders that were then acquiring the Series A Preferred Stock.
Stockholders and be binding upon all Company Stockholders presently or hereafter becoming a
party hereto, in order to provide, among other things, for certain restrictions relating to the
transfer of the Equity Securities and other rights and responsibilities among the Company
Stockholders as set forth herein; and
ARTICLE I
RECITALS AND DEFINED TERMS
RECITALS AND DEFINED TERMS
The above recitals are true and correct, and are incorporated into and made part of this
Agreement. For all purposes of this Agreement, certain capitalized terms specified in Exhibit
A shall have the meanings set forth in Exhibit A, except as otherwise expressly
provided in this Agreement.
ARTICLE II
BOARD OF DIRECTORS
BOARD OF DIRECTORS
As provided in the Company’s Second Amended and Restated Certificate of Incorporation (as in
effect as of the Effective Date and as further amended and in effect from time to time hereafter,
the “Charter”) and the Amended and Restated Bylaws of the Company (as amended and in effect
as of the Effective Date and as further amended and in effect from time to time thereafter in
accordance with the provisions thereof and of the Charter, the “Bylaws”), all directors of
the Company shall be elected by the holders of the Common Stock from time to time outstanding
(including, without limitation, the holders of any Common Stock issued in respect of Options Equity
or warrants to purchase Common Stock, as well as Common Stock issued to any Company Stockholder
(including any Preferred Investor Stockholder or any of its Affiliates) in respect of the Preferred
Stock or otherwise, each a “Common Stockholder” and collectively, the “Common
Stockholders”), the Series A Preferred Stock, the Series B Preferred Stock and the Series C
Preferred Stock voting in accordance with the provisions of this Agreement, the Bylaws and the
Charter. Each director shall serve in accordance with this Agreement and the Bylaws and, if
continuing, shall stand for re-election annually, subject to the terms of this Article II.
Until this Agreement shall have been terminated as provided in Section 7.3 below, the
Company and each Company Stockholder (for so long as such Company Stockholder owns any Equity
Securities of the Company) shall use their best efforts to take or cause to be taken all actions
within their respective power and authority and in accordance with applicable law (including,
without limitation, the voting of shares of Equity Securities held by such Company Stockholder or
the taking of action by written consent with respect to such shares) as may reasonably be required
to effect the agreements contained in this Article II.
2.1 Board of Directors. The Company and each Company Stockholder hereby acknowledges
and agrees that, and shall take or cause to be taken all actions reasonably necessary such that:
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(a) Subject to Section 2.1(i) set forth below, the authorized membership
of the Board of Directors of the Company (the “Board”) shall be established and
maintained at seven (7) directors.
(b) For so long as the Series B Investor Stockholders continue to own not less than
twenty-five percent (25%) of the total number of shares of Series B Preferred Stock issued,
collectively, on the on the dates of the First Closing and the Second Closing under (and
each as defined in) the Series B Purchase Agreement (as adjusted for any stock splits,
recapitalizations and the like) (the “Series B Director Condition”), the Series B
Investor Stockholders shall cause to be elected, by a vote or written consent of the
holders of the Series B Preferred Stock as set forth in clauses (x) and (y) below, to the
Board two (2) directors (each a “Series B Director” and together, the “Series B
Directors”), which Series B Directors shall be designated as follows: (x) one Series B
Director shall be designated by the MDS Entities, or any successor or assign of the MDS
Entities who holds more than fifty percent (50%) of the Series B Preferred Stock initially
issued to the MDS Entities pursuant to the Series B Purchase Agreement and (y) one Series B
Director shall be designated by Aperture Capital II, L.P. (“Aperture”) and MK
Investment Co. (“MKCO”) voting together as a separate class; provided, that either
or both of Aperture and MKCO may only assign this right to any of its successors or assigns
who holds more than fifty percent (50%) of the Series B Preferred Stock initially issued to
Aperture or MKCO, as the case may be, pursuant to the Series B Purchase Agreement, which
Series B Directors are hereby initially designated by the Series B Investor Stockholders as
Xxxxx Xxxxx, designated by the MDS Entities and Xxxxxxx Xxxx, designated by Aperture and
MKCO; provided, that, if as of any date, the Series B Director Condition shall cease to be
satisfied, the Series B Investor Stockholders shall not be entitled to cause the Series B
Directors to be elected to the Board, but rather such directors shall be elected by a vote
or written consent of a majority of the Equity Securities (determined on an
as-if-converted, Common Stock-equivalent basis) then held by the Company Stockholders.
(c) For so long as (i) the Series A Investor Stockholders continue to own not less
than twenty-five percent (25%) of the total number of shares of Series A Preferred Stock
issued on all Applicable Closing Dates under (and as defined in) the Series A Purchase
Agreement (as adjusted for any stock splits, recapitalizations and the like), or (ii) the
total number of issued and outstanding shares of Series A Preferred Stock continue to
represent not less than ten percent (10%) of the total voting power of any and all shares
of the Company’s Preferred Stock from time to time outstanding (in each case, with respect
to all such shares of Preferred Stock, on an as-if-converted, Common Stock-equivalent
basis), the Series A Investor Stockholders shall cause to be elected, by a vote or written
consent of the holders of a majority of the Series A Preferred Stock held by such Series A
Investor Stockholders, to the Board one (1) director (the “Series A Director”),
which Series A Director is hereby initially designated by the Series A Investor
Stockholders as Xxxxxxxxxxx X. Xxxxx; provided, that, if as of any date, both of the
conditions specified in the foregoing clauses (i) and (ii) shall cease to be satisfied, the
Investor Stockholders shall not be entitled to cause the Series A Director to be elected to
the Board, but rather such director shall be elected by a vote or written consent of a
majority of the Equity Securities (determined on an as-if-converted, Common
Stock-equivalent basis) then held by the Company Stockholders.
(d) For so long as (i) the Series C Investor Stockholders continue to own not less
than twenty-five percent (25%) of the total number of shares of Series C Preferred Stock
issued on the date of the Closing under (and as defined in) the Series C Purchase Agreement
(as adjusted for any stock splits, recapitalizations and the like), or (ii) the total
number of issued and
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outstanding shares of Series C Preferred Stock continue to represent not less than five
percent (5%) of the total voting power of any and all shares of the Company’s Preferred Stock from
time to time outstanding (in each case, with respect to all such shares of Preferred Stock, on an
as-if-converted, Common Stock-equivalent basis), the Series C Investor Stockholders shall cause to
be elected, by a vote or written consent of the holders of a majority of the Series C Preferred
Stock held by such Series C Investor Stockholders, to the Board one (1) director (the “Series
C Director”) designated by the Tudor Series C Investor Stockholders, which Series C Director
is hereby initially designated by the Tudor Series C Investor Stockholders as Xxxxxxx Xxxxxxx;
provided, that, if as of any date, both of the conditions specified in the foregoing clauses (i)
and (ii) shall cease to be satisfied, the Investor Stockholders shall not be entitled to cause the
Series C Director to be elected to the Board, but rather such director shall be elected by a vote
or written consent of a majority of the Equity Securities (determined on an as-if-converted,
Common Stock-equivalent basis) then held by the Company Stockholders.
(e) The Common Stockholders shall cause to be elected, by a vote or by written consent of the
holders of a majority of such issued and outstanding Common Stock, one (1) director (the
“Common Director”) to the Board, which Common Director is hereby designated by the Common
Stockholders as the individual holding the position of Chief Executive Officer of the Company (the
“CEO”), which CEO as of the Effective Date is Xxxxxxx X. Xxxxx, M.D.
(f) Two (2) individuals that are Independent and otherwise qualified to be members of
the Board (each an “Independent Director”), with such Independent Directors to be
appointed by vote of a majority of the Board; provided, however, that (i) one of the
initial directors to be appointed by vote of a majority of the Board shall be Xxxxx
Xxxxxxxxxx who is not Independent; (ii) Xxxxxxx Xxxxxxx, originally designated by
designated by Aperture and MKCO as a director of the Company, shall remain as a member of
the Board until the earlier to occur of (y) the time at which the second Independent
Director is elected by the Board to replace him, and (z) the date six (6) months following
the Effective Date, at which point he will resign, and (iii) any and all future Board
members appointed by vote of a majority of the Board shall be Independent. For the
purposes of this Subsection (f), an individual whose only nontrivial professional, familial
or financial connection to the Company, any member of the Board, the CEO or any other
executive officer is his or her directorship shall be deemed “Independent.”
(g) In the case of death, resignation, or other removal, as provided in the Bylaws, of
any director of the Company (“Director”) appointed by a Company Stockholder or any
group of Company Stockholders having authority to designate the election of such director
under this Section 2.1 (in all such cases, the “Designating Stockholder”),
the Designating Stockholder shall have exclusive authority to designate the election in its
discretion of another individual to fill the vacancy created thereby.
(h) No action shall be taken by the Board during the pendency of any vacancy due to
death, resignation or removal of any Director, unless the applicable Designating
Stockholder shall have failed, for a period of thirty (30) Business Days after written
notice from the Company as to the vacancy, to designate a replacement.
(i) Notwithstanding anything to the contrary, upon an Event of Noncompliance (as
defined in the Charter), those Preferred Investor Stockholders holding not less than
sixty-six and two-thirds percent (66 2/3 %) of the outstanding
Preferred Stock voting together as a single class (based on the number of shares held by such holders
on an as-if-converted, Common Stock-equivalent basis) (the “Preferred Majority”),
have the right to (x) increase the size of the Board to nine (9) directors; (y) cause to be
elected two (2) additional members of the Board; and (z) cause
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the holders of the Preferred Stock (voting together as the Preferred Majority) to have the
right to designate such two (2) additional members in order to allow the holders of the Preferred
Stock to elect a majority of the Board.
(j) For so long as each of (i) Aperture and MKCO (or an Affiliate thereof); (ii) the Tudor
Stockholders (together with their Affiliates); or (iii) the Common Stockholders, as a single
class, shall own not less than five percent (5%) (on an as converted basis with respect solely to
the Preferred Stock held by Aperture and MKCO or the Tudor Stockholders and adjusted for stock
splits, recapitalizations and the like) of the issued and outstanding Common Stock of the Company,
including for this purpose any Common Stock issuable upon conversion of any outstanding Preferred
Stock, Aperture and MKCO, the Tudor Stockholders and the Common Stockholders shall each have the
right to appoint a representative to attend as a non-voting observer (its “Observer”) each
and every meeting of the Board. Each Observer shall receive, on a timely basis, copies of all
notices, minutes, consents, and other materials that the Company provides to the members of its
board; provided, however, that the Company reserves the right to exclude such Observers from
access to any meeting or any materials if it is reasonably believed that such exclusion is
necessary to preserve any privilege, to protect confidential or otherwise proprietary information
or for any other reason if the Board, acting in good faith, reasonably determines that the
presence of such Observers would not be appropriate given the subject matter being discussed.
Except to the extent so excluded, the Observers may participate in discussions of any and all
matters brought before any meeting he attends as a non-voting observer.
2.2 Board Meetings. The Company and each Company Stockholder agree to use commercially
reasonable efforts to take, or cause the Board to take, actions reasonably necessary to hold
meetings of the Board at least once each calendar quarter in accordance with this Agreement and the
Bylaws (unless a majority of the Board determines otherwise). The Company will pay all reasonable
direct travel expenses of Directors in connection with attending any meetings of the Board or any
Board Committees not held by telephonic means as provided in the Bylaws.
2.3 Board Committees. The Company Stockholders hereby agree to the establishment and
appointment of (a) a compensation committee of the Board (the “Compensation Committee”),
consisting of not less than three (3) Directors, empowered and directed to determine and approve,
on behalf of and in lieu of the full Board, all compensation matters related to the Company’s
management personnel or otherwise related to the Options Equity; and (b) an audit committee of the
Board (the “Audit Committee”), consisting of not less than three (3) Directors, empowered
and directed to review and approve the Company’s financial statements and related matters. The
Compensation Committee and the Audit Committee shall (i) not include any Director that is at that
time employed by the Company except as a non-voting advisor to such committee as reasonably
required and requested by such committee; and (ii) always include the Series A Director, the Series
C Director and at least one (1) Series B Director (for so long as each such director is elected by
the respective Designating Stockholder). Every committee of the Board shall include not less than
one (1) of the Series B Directors and, if requested by the Tudor Stockholders, the Series C
Director.
2.4 Matters Requiring the Approval of the Series B Directors and Series C Director.
For so long as any shares of (x) the Series B Preferred Stock remain issued and outstanding, the
Company shall not, absent (i) the requisite approval of the Board and (ii) the affirmative vote of
both Series B Directors and (y) the Series C Preferred Stock remain issued and outstanding, the
Company shall not, absent (i) the requisite approval of the Board and (ii) the affirmative vote of
the Series C Director:
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(a) make any loan or advance to, or own any stock or other securities of, any
subsidiary or other corporation, partnership, or other entity unless it is wholly-owned by
the Company;
(b) make any loan or advance to any person, including any employee or director, except
advances and similar expenditures made in the ordinary course of business or under the terms of
an Approved Option Plan;
(c) guarantee any indebtedness except for trade accounts of the Company or any
subsidiary arising in the ordinary course of business;
(d) make any investment other than investments in prime commercial paper, money market
funds, certificates of deposit in any United States bank having a net worth in excess of
$100,000,000 or obligations issued or guaranteed by the United States of America, in each case
having a maturity not in excess of two (2) years;
(e) incur any aggregate indebtedness in excess of $50,000 that is not already included in
the Company’s Operating Plan, other than trade credit incurred in the ordinary course of
business;
(f) enter into or be a party to any transaction or series of transactions with any
director, officer or employee of the Company or any Associate of any such person except
transactions resulting in payments to or by the Company in an amount less than $30,000 in the
aggregate in any given year;
(g) terminate any Company executive officer;
(h) approve or amend any Company employee stock or option plan;
(i) change the Principal Business of the Company or exit the Company’s Line of Business;
(j) sell, transfer, pledge or encumber the Company’s intellectual property; or
(k) grant a license for the Company’s intellectual property to any Third Party for
commercial exploitation within the Line of Business.
2.5 D&O Insurance. The Company shall have at the Effective Time and shall use
commercially reasonable efforts to maintain during the term of this Agreement, customary
directors’ and officers’ liability insurance coverage in an amount and on such terms as
determined by the Board, for each Director that serves on or at the request of the Board.
ARTICLE III
TRANSFER OF EQUITY SECURITIES
TRANSFER OF EQUITY SECURITIES
Until the closing of a Qualified IPO, the following restrictions shall apply to the transfer
of Equity Securities:
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3.1.1 Additional Stockholders. Immediately upon and as a condition to the
issuance or grant of any Options Equity or other Equity Securities to any person or entity (such
person or entity, an “Additional Stockholder”) at any time from and after the Effective
Date, the Company shall cause each such Additional Stockholder to enter into an agreement and
instrument of accession to this Agreement, as annexed hereto and entitled “Counterpart Signature
Page and Joinder” or in a form and substance otherwise satisfactory to the Board, whereby such
Additional Stockholder shall agree to become and remain bound by the restrictions and provisions
of this Agreement as and to the same extent as the Company Stockholders party hereto. Upon any
Additional Stockholder’s accession hereto as aforesaid, any and all Equity Securities held thereby
shall at all times thereafter be subject to the provisions of this Article III and the
other applicable provisions of this Agreement.
3.1.2 Restrictions on Transfer by Company Stockholders. No Company Stockholder shall
Transfer any shares of Equity Securities except pursuant to this Article III, other than
Transfers upon and in connection with the Qualified IPO or Transfers in accordance with any and all
other applicable provisions of this Agreement, all applicable laws and regulations and the policies
and directions of the Company from time to time established by the Board with respect to such
Transfers. No Transfer of shares of Equity Securities in violation of this Agreement shall be made
or recorded on the books of the Company, and any such Transfer shall be void and of no effect.
3.2.1 First Refusal Rights. No Common Stockholder shall Transfer any Common
Stock now or hereafter held or acquired by that Common Stockholder to any individual or
entity except upon receipt of a written bona fide Third Party offer (a “Third Party
Offer”) and after the Common Stockholder desiring to make the Transfer (the
“Selling Common Stockholder”) shall first deliver a written notice (the
“Transfer Notice”) to the Company and the Preferred Investor Stockholders who then
own shares of Preferred Stock specifying (i) the name and address of the individual or
entity making the Third Party Offer, (ii) the number and class or series of Common Stock
which the Selling Common Stockholder wishes to sell (the “Offered Shares”), (iii)
the cash or other purchase price offered for the Common Stock, (iv) any other terms and
conditions of such proposed Transfer and (v) a copy of the Third Party Offer. The Transfer
Notice shall constitute an irrevocable offer by the Selling Common Stockholder to sell, in
accordance with this Section 3.2, to the Company and the other Preferred Investor
Stockholders, the Offered Shares at the price and on the same terms and conditions
contained in the Transfer Notice.
3.2.2 Company Rights. Within ten (10) Business Days following its receipt of
the Transfer Notice, the Company shall notify the Selling Common Stockholder and the
Preferred Investor Stockholders as to the Company’s election to purchase the Offered Shares
(each such notice being a “Company Acceptance”). Each Company Acceptance shall be
deemed to be an irrevocable commitment to purchase from the Selling Common Stockholder the
Offered Shares. Failure by the Company to deliver a Company Acceptance within the
applicable period shall be deemed a waiver by the Company of its right to purchase the
Offered Shares.
3.2.3 If (i) the Company does not give the Company Acceptance within such ten (10) day
period or (ii) the Company gives the Company Acceptance within the applicable
period but the Company Acceptance provides that the Company desires to purchase less
than all of the Offered Shares, the Company shall so notify the Preferred Investor
Stockholders and each of the Series C Investor Stockholders who then hold shares of the
Series C Preferred Stock shall have the right and option, but not the obligation, to
purchase the number of Offered Shares which the
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Company has not elected to purchase (the “Series C Remainder Shares”), pro
rata in the same proportion of the Series C Preferred Stock owned by it among all Series C
Investor Stockholders, at the price and upon the terms and conditions set forth in the
Transfer Notice. The option provided for herein shall be exercisable by the Series C
Investor Stockholders by giving written notice to the Selling Common Stockholder, the
Company and each other Preferred Investor Stockholders within twenty (20) Business Days
after receipt of the Transfer Notice (the “Series C Stockholder Notice”). Each
Series C Stockholder Notice shall provide whether such Series C Investor Stockholder
desires to exercise its right to purchase all or any portion of its pro rata share of the
Series C Remainder Shares. In addition, each Series C Investor Stockholder may, in its
Series C Stockholder Notice, offer to purchase more than such Series C Investor
Stockholder’s pro rata share of the Series C Remainder Shares (any such Series C Investor
Stockholder, an “Oversubscribing Series C Stockholder”). If less than all of the
Series C Investor Stockholders elect to purchase their pro rata share of the Series C
Remainder Shares (the “Series C Unsubscribed Shares”), the Series C Unsubscribed
Shares shall be allocated pro rata among the Oversubscribing Series C Stockholders (based
on the number of Series C Preferred Shares owned by each Oversubscribing Series C
Stockholder) up to the number of shares specified in such person’s Series C Stockholder
Notice or on such other basis as such Oversubscribing Series C Stockholders may agree.
3.2.4 If the Company and the Series C Investor Stockholders (whether as
Oversubscribing Series C Stockholders or otherwise) collectively purchase less than all of
the Offered Shares, then each of the Series B Investor Stockholders who then hold shares of
the Series B Preferred Stock shall have the right and option, but not the obligation, to
purchase the number of Offered Shares which the Company has not elected to purchase (the
“Series B Remainder Shares”), pro rata in the same proportion of the Series B
Preferred Stock owned by it among all Series B Investor Stockholders, at the price and upon
the terms and conditions set forth in the Transfer Notice. The option provided for herein
shall be exercisable by the Series B Investor Stockholders by giving written notice to the
Selling Common Stockholder, the Company and each other Preferred Investor Stockholder
within twenty (20) Business Days after receipt of the Transfer Notice (the “Series B
Stockholder Notice”). Each Series B Stockholder Notice shall provide whether such
Series B Investor Stockholder desires to exercise its right to purchase all or any portion
of its pro rata share of the Series B Remainder Shares. In addition, each Series B Investor
Stockholder may, in its Series B Stockholder Notice, offer to purchase more than such
Series B Investor Stockholder’s pro rata share of the Series B Remainder Shares (any such
Series B Investor Stockholder, an “Oversubscribing Series B Stockholder”). If less
than all of the Series B Investor Stockholders elect to purchase their pro rata share of
the Series B Remainder Shares (the “Series B Unsubscribed Shares”), the Series B
Unsubscribed Shares shall be allocated pro rata among the Oversubscribing Series B
Stockholders (based on the number of Series B Preferred Shares owned by each
Oversubscribing Series B Stockholder) up to the number of shares specified in such person’s
Series B Stockholder Notice or on such other basis as such Oversubscribing Series B
Stockholders may agree.
3.2.5 If the Company, the Series C Investor Stockholders (whether as Oversubscribing
Series C Stockholders or otherwise), and the Series B Investor Stockholders (whether as
Oversubscribing Series B Stockholders or otherwise) collectively purchase less than all of
the Offered Shares, each of the Series A Investor
Stockholders who then hold shares of the Series A Preferred Stock shall have the right
and option, but not the obligation, to purchase the number of Offered Shares which the
Company, the Series C Investor Stockholders and Series B Investor Stockholders have
collectively not elected to purchase (the “Series A Remainder Shares”), pro rata in
the same proportion of the Series A Preferred Stock owned by it among all Series A
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Investor Stockholders, at the price and upon the terms and conditions set forth in the
Transfer Notice. The option provided for herein shall be exercisable by the Series A
Investor Stockholders by giving written notice to the Selling Common Stockholder, the
Company and the other Series A Investor Stockholders within thirty (30) Business Days after
receipt of the Transfer Notice (the “Series A Stockholder Notice”). Each Series A
Stockholder Notice shall provide whether such Series A Investor Stockholder desires to
exercise its right to purchase all or any portion of its pro rata share of the Series A
Remainder Shares. In addition, each Series A Investor Stockholder may, in its Series A
Stockholder Notice, offer to purchase more than such Series A Investor Stockholder’s pro
rata share of the Series A Remainder Shares (any such Series A Investor Stockholder, an
“Oversubscribing Series A Stockholder”). If less than all of the Series A Investor
Stockholders elect to purchase their pro rata share of the Series A Remainder Shares (the
“Series A Unsubscribed Shares”), the Series A Unsubscribed Shares shall be
allocated pro rata among the Oversubscribing Series A
Stockholders (based on the number of shares owned by each Oversubscribing Series A Stockholder) up to the number of shares
specified in such person’s Series A Stockholder Notice or on such other basis as such
Oversubscribing Series A Stockholders may agree.
3.2.6 If the Company and/or the Preferred Investor Stockholders do not purchase all of
the Offered Shares within the time frame set forth above, the Selling Common Stockholder
(a) shall be under no obligation to sell any of the Offered Shares to the Company and/or
the other Preferred Investor Stockholders, unless the Selling Common Stockholder so elects,
and (b) may, within a period of one hundred twenty (120) days from the date of the Transfer
Notice, sell all, but not less than all, of the Offered Shares to one or more Third Parties
(each a “Third Party Transferee”), at the same price and upon terms and conditions
substantially the same as those specified in the Transfer Notice. Upon any such sale, the
Third Party Transferee of the Offered Shares shall execute an agreement and instrument of
accession to this Agreement, as annexed hereto and entitled “Counterpart Signature Page and
Joinder” or in a form and substance otherwise satisfactory to the Board pursuant to which
the Third Party Transferee agrees that the Common Stock it acquired from the Selling Common
Stockholder is subject to the provisions of this Article III and the other
applicable provisions hereof. Any Third Party Transferee to whom Offered Shares are
transferred pursuant to and in compliance with this Section 3.2 shall, upon
consummation of such Transfer, be deemed a Company Stockholder hereunder. If the Selling
Common Stockholder does not complete the sale of the Offered Shares within the one hundred
twenty (120)-day period as aforesaid, the provisions of this Article III shall
again apply, and no Transfer of Common Stock held by the Selling Common Stockholder shall
be made other than in accordance with the terms of this Agreement.
3.2.7 Closing. The closing of purchases of Offered Shares by the Company
and/or the Preferred Investor Stockholders pursuant to this Section 3.2 shall take place
within sixty (60) days after the date of the Transfer Notice at 10:00 A.M. local time at
the principal offices of the Company, or at such other date, time or place as the parties
to the sale may agree (the “Closing”). At least five (5) Business Days prior to the
Closing, the Company and/or the Preferred Investor Stockholders shall notify the Selling
Common Stockholder in writing of the name and number of purchasers and the portion of the
Offered Shares to be purchased by the Company and/or the Preferred Investor Stockholders.
At the Closing, the Selling Common Stockholder shall sell, transfer and deliver to the
Company and/or the Preferred Investor Stockholders full right, title and interest in and to
the Offered Shares so purchased, free and clear of all liens, security
interests or adverse claims of any kind and nature (except as otherwise set forth in
the Charter and this Agreement and applicable securities laws) and shall deliver to the
Company and/or the Preferred Investor Stockholders a certificate or certificates
representing the Offered Shares sold, in each
- 9 -
case duly endorsed for transfer or accompanied by appropriate stock transfer powers
duly endorsed with signatures guaranteed by a commercial bank, trust company or registered
broker dealer. After Closing, simultaneously with delivery of the certificates, the Company
and/or the Preferred Investor Stockholders shall deliver to the Selling Common Stockholder,
in full payment of the purchase price of the Offered Shares purchased, (a) any cash
consideration for the shares by wire transfer of immediately available funds to the bank
and the account designated by the Selling Common Stockholder and/or (b) any non-cash
consideration for the shares in person to the Selling Common Stockholder in accordance with
the Transfer Notice.
3.3 Co-Sale Rights. To the extent any rights of first refusal are not exercised under
Section 3.2 as to all Offered Shares, the Selling Common Stockholder shall afford each Preferred
Investor Stockholder the opportunity to participate in the sale with the Selling Common
Stockholder, with each Preferred Investor Stockholder participating in the sale pro rata in the
same proportion that the Equity Securities owned by it (on an as-if-converted, Common
Stock-equivalent basis) represents to all of the issued and outstanding Equity Securities of the
Company (on an as-if-converted, Common Stock-equivalent basis), and for the same consideration and
otherwise on the same terms as the Selling Common Stockholder sells its Common Stock. In the event
that any Selling Common Stockholder shall propose a sale of Common Stock owned by it as
contemplated by this Section 3.3, the Selling Common Stockholder shall provide the Transfer
Notice to the Company and the Preferred Investor Stockholders in accordance with Section
3.2, and each Preferred Investor Stockholder intending to participate in the proposed sale
pursuant to this Section 3.3 shall state its intention to so participate in writing (each,
a “Preferred Investor Stockholder Participation Notice”), delivered to the Selling Common
Stockholder, the Company and the other Preferred Investor Stockholders in accordance with the
notice time periods set forth in Section 3.2. If any Preferred Investor Stockholder fails
to deliver a Preferred Investor Stockholder Participation Notice to the Selling Common Stockholder
in accordance with the notice time periods set forth in Section 3.2, such Preferred
Investor Stockholder’s failure to deliver its Preferred Investor Stockholder Participation Notice
shall be deemed to be a waiver of such Preferred Investor Stockholder’s right to participate in
such sale.
3.4 Drag-Along Rights. Notwithstanding any provision of this Agreement to the
contrary, if, at any time after the Effective Date, both the Series B Preferred Stockholders
holding a Series B Majority and the Series C Preferred Stockholders holding a Series C Majority
propose to effect a Deemed Liquidation Event (a “Drag-Along Transaction”), such Series B
Preferred Stockholders and Series C Preferred Stockholders shall be entitled to, but shall not be
obligated to, require each of the other Company Stockholders or other persons or entities holding
any Equity Securities (each, a “Drag-Along Stockholder”) to join in (participating pro rata
in the same proportion that the Equity Securities owned by each such Series B Preferred
Stockholder, Series C Preferred Stockholder and Drag-Along Stockholder (determined on an
as-if-converted, Common Stock-equivalent basis with respect to all Equity Securities, including the
Preferred Stock) represents to all of the issued and outstanding Equity Securities of the Company
(on an as-if-converted, Common Stock-equivalent basis)), and to include in and to sell any and all
of the Equity Securities held by such Drag-Along Stockholder in the Drag-Along Transaction, in each
case, for the same proportionate, Common Stock-equivalent consideration and otherwise on the same
terms and conditions as such Series B Preferred Stockholders and Series C Preferred Stockholders
propose to sell their shares of Preferred Stock (after payment to the Preferred Investor
Stockholders of all preferences and dividends payable as to the Preferred Stock (the “Preferred
Preferences”), as described in the Charter, with all Equity Securities within any
particular series or class being treated for such purposes on equivalent terms (after payment of
the Preferred Preferences); provided, however that the Series A Investor Stockholders shall not be
subject to any Drag-Along Transaction unless such Drag-Along Transaction either (a) ensures payment
in full (in cash proceeds) of all preferences and dividends payable as to outstanding Series A
Preferred Stock as described in the Charter; or (b) has been approved by a
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Series A Majority. The closing of any Drag-Along Transaction shall occur not less than thirty
(30) days after delivery of written notice by the Series B Preferred Stockholders and Series C
Preferred Stockholders to all Drag-Along Stockholders stating the applicable terms and timing
thereof, promptly upon which notice all such Drag-Along Stockholders shall execute such documents
and take such other actions as necessary for or incidental to such closing, and each Drag-Along
Stockholder hereby grants to the Company its power of attorney, which is durable and coupled with
an interest and shall survive the death or disability of such Drag-Along Stockholder, to execute
and deliver any and all documents, and to take any and all other actions, as reasonably necessary
in connection with such Drag-Along Stockholder’s sale of its Equity Securities pursuant to this
Section 3.4. Upon any closing of a Drag-Along Transaction, the Series B Preferred
Stockholders, the Series C Preferred Stockholders and any and all Drag-Along Stockholders shall
have been deemed to have sold and disposed of their Equity Securities in their entirety pursuant to
the applicable terms of such Drag-Along Transaction, and shall retain no further right with respect
to such Equity Securities other than the right to receive the consideration paid or payable in
respect thereof in connection with such sale.
ARTICLE IV
RIGHTS OF FIRST OFFER
RIGHTS OF FIRST OFFER
4.1 Pre-Emptive Right. The Company hereby grants to each Preferred Investor
Stockholder the right (but not the obligation) to purchase a pro rata share of any New Securities
(as hereinafter defined) that the Company may, at any time from and after the Effective Date,
propose to sell, issue or grant. A pro rata share, for purposes of this right, is the portion of
the New Securities obtained by multiplying the total number of New Securities proposed to be sold,
issued or granted by a fraction, (x) the numerator of which is the sum of (i) the total
number of shares of Common Stock then held by each Preferred Investor Stockholder, plus
(ii) the total number of shares of Common Stock into which shares of Preferred Stock then held by
such Preferred Investor Stockholder may then be converted (“Conversion Shares”), and (y)
the denominator of which is the total number of shares of Common Stock then held by each
Preferred Investor Stockholder and Conversion Shares then outstanding (or deemed outstanding),
together with all shares of Common Stock then held in escrow on behalf of the Preferred Investor
Stockholders, subject to vesting or similar restrictive requirements or otherwise issuable upon
conversion of other Convertible Securities (as such term is defined in the Charter) as are
outstanding immediately prior to the issuance of such New Securities. For purposes of this
Article IV, “New Securities” shall mean all Equity Securities of any type or
amount, except for, in all cases as properly approved pursuant to the provisions of this Agreement
and/or the Charter (in each case, as applicable, a “Requisite Approval”), (1) the issuance
of Common Stock upon conversion of any shares of Preferred Stock, or as a dividend or distribution
relative to the Preferred Stock; (2) the issuance of securities in a Qualified IPO; (3) the
issuance of securities pursuant to the Company’s bona fide acquisition of another corporation, or
all or a portion of its assets, by merger, purchase of assets, or other corporate reorganization,
in each case after all applicable contractual and statutory approvals have been obtained; (4) the
issuance of securities (i) pursuant to the Purchase Agreements or (ii) upon the conversion or
exercise of any debenture, warrant, option or Option Equity granted prior to the Effective Date and
as disclosed in the Series C Purchase Agreement; (5) the authorization, grant or issuance (or entry
into a plan, arrangement, agreement, transaction, commitment or arrangement to authorize, grant or
issue) of the shares of the Company’s Common Stock (through Options Equity or otherwise) to
employees, officers, or directors of, or contractors, consultants, or advisors to the Company
pursuant to an Approved Option Plan; or (6) any stock split, subdivision or combination affecting
the Common Stock or the issuance of shares of Common Stock pursuant to a stock dividend or other distribution on Common
Stock.
4.2 Sale Notice. In the event the Company proposes to undertake an issuance of New
Securities, it shall give the Preferred Investor Stockholders written notice of its intention,
describing the
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type of New Securities, the price and the general terms and conditions upon which the Company
proposes to issue the New Securities (a “Sale Notice”). Each Preferred Investor Stockholder shall
have twenty (20) days from the date of receipt of any such Sale Notice (the “Election
Period”) to elect to purchase all or a portion of its pro rata share of the New Securities for
the price and on the general terms and conditions specified in the Sale Notice by giving written
notice to the Company and stating therein the quantity of New Securities to be purchased. In the
event that any Series B Investor Stockholders do not purchase their full pro rata share of New
Securities (the “Unpurchased B Pro Rata Shares”), then each Series B Investor Stockholder
electing to purchase all of its pro rata share of the New Securities (each a “Full Purchasing
Series B Investor Stockholder”) shall have ten (10) days following the Election Period (the
“Additional Period”) to elect to purchase all or any part of the Unpurchased B Pro Rata
Shares (with any oversubscription by such Full Purchasing Series B Investor Stockholders allocated
among such electing Full Purchasing Series B Investor Stockholders based on their relative pro rata
share of all New Securities or as they may otherwise agree). In addition, in the event that any
Series C Investor Stockholders do not purchase their full pro rata share of New Securities (the
“Unpurchased C Pro Rata Shares”), then each Series C Investor Stockholder electing to
purchase all of its pro rata share of the New Securities (each a “Full Purchasing Series C
Investor Stockholder”) shall have the Additional Period to elect to purchase all or any part of
the Unpurchased C Pro Rata Shares (with any oversubscription by such Full Purchasing Series C
Investor Stockholders allocated among such electing Full Purchasing Series C Investor Stockholders
based on their relative pro rata share of all New Securities or as they may otherwise agree).
4.3 Time Period for Sale. In the event the Preferred Investor Stockholders fail to
exercise fully the rights granted hereunder within the foregoing thirty (30) day period (comprised
of the Election Period and the Additional Period), the Company shall have ninety (90) days from the
date of the Sale Notice to effect the sale of the New Securities at a price and on terms and
conditions no more favorable to the purchasers thereof than those offered to the Preferred Investor
Stockholders in the Sale Notice. In the event the sale is not effected within such ninety (90) day
period, the Company shall not issue and sell the New Securities without first offering the New
Securities to the Investor Stockholders again in the manner provided in this Article IV.
4.4 Assignment of Pre-Emptive Right. Notwithstanding Section 7.4 below, each
Preferred Investor Stockholder from time to time may assign its rights under this Article
IV or any portion thereof to any of its Affiliates who agree to be bound under this Agreement.
The aggregate pro rata share of each Preferred Investor Stockholder and its Affiliates as a group
(an “Investor Stockholder Group”) shall be equal for all purposes to the number of New
Securities which would have constituted the pro rata share of such Preferred Investor Stockholder
had no such assignment been effected, and may be allocated among the members of the Investor
Stockholder Group in any manner agreed on by the Investor Stockholder Group.
4.5 Termination. The provisions of this Article IV shall terminate on
the closing of the Qualified IPO.
5.1 Board Votes. The voting of shares pursuant to this Agreement may be effected in
person, by proxy, by written consent or in any other manner permitted by applicable law. Each of
the Company Stockholders hereby grants to the Board, in the event that such Company Stockholder
fails to vote its shares of the capital stock of the Company as required by Sections
2.1 and 3.4 of this Agreement, a proxy coupled with an interest in all shares of the
capital stock of the Company beneficially owned by such
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Company Stockholder, which proxy is irrevocable until this Agreement terminates pursuant to
its terms or this Section 5.1 is amended to remove such grant of proxy in accordance with
Section 7.5 of this Agreement.
ARTICLE VI
ADDITIONAL COVENANTS OF THE COMPANY
ADDITIONAL COVENANTS OF THE COMPANY
The Company hereby further covenants with each Company Stockholder as follows:
6.1. Books and Records. The Company shall keep and maintain adequate and proper books
and records of account, in which complete entries are made in accordance with all applicable laws,
rules, and regulations, reflecting all financial and other transactions of the Company normally or
customarily included in books and records of account of companies engaged in the same or similar
businesses and activities as the Company.
6.2. Financial and Business Information. From and after the Effective Date, the Company
shall furnish to each Company Stockholder holding, together with Affiliates, at least one percent
(1%) of the Equity Securities of the Company (on an as-if-converted, Common Stock-equivalent
basis), the following materials, information and inspection rights as and when required in
accordance with this Section 6.2; provided, however that the materials listed in
Section 6.2(c) below, shall only be furnished to the Qualifying Holders:
(a) as soon as available and in any event within one hundred twenty (120) days after the
end of each fiscal year of the Company, a copy of the audited balance sheet of the Company
as of the end of such fiscal year and the related audited statements of income and cash
flows for the fiscal year, all prepared in reasonable detail, and certified by independent
certified public accountants of recognized standing approved by the Board and by the Audit
Committee, presenting fairly in all material respects the financial position of the Company
and approved by the Audit Committee, including footnotes and setting forth in comparative
form the corresponding figures for the corresponding period of the preceding fiscal year,
subject to the applicable requirements of generally accepted accounting principles;
(b) as soon as available and in any event within forty five (45) days after the end of each
fiscal quarter of the Company (other than the last quarter of each fiscal year) a copy of
the unaudited balance sheet of the Company as of the end of the quarter and the related
unaudited statements of income and cash flows of the Company for the periods commencing at
the end of the previous quarter and ending at the end of the quarter and commencing at the
beginning of the fiscal year and ending at the end of the quarter, along with an updated
capitalization table showing all issued and outstanding Equity Securities certified to be
accurate by the Chief Financing Officer of the Company;
(c) no later than thirty (30) days prior to the end of any fiscal year, a forward looking
operating plan and comprehensive operating plan and budget forecasting the Company’s
anticipated revenues (if any), expenses and cash position on a month-to-month basis for the
upcoming fiscal year as approved by the Board (the “Operating
Plan”) and all other
management information reports as the Qualifying Holders may reasonably request from time
to time, including any amendments, modifications and/or supplements to any of the
foregoing; and
(d) upon reasonable, advanced written notice stating the purpose thereof, access to the
Company’s facilities and personnel during the usual hours of business for a purpose
reasonably related to such Company Stockholder’s status as a Company Stockholder.
- 13 -
6.3. Directors and Officers Insurance Upon a Change of Control Transaction. In
the event of a Change of Control Transaction, the Company shall make adequate and proper provisions
to ensure that the successor entity shall assume all obligations of the Company with respect to
indemnification of and insurance coverage for the Company’s directors and officers as holding their
respective positions immediately prior to such Change of Control Transaction.
6.4. Confidentiality. The Company and each Company Stockholder shall not use or
disclose to others any Confidential Information received from the Company or from any other Company
Stockholder for any purpose other than for the benefit of the Company, as determined by the Board,
or as required by law or order of court, government authority, or arbitrator. The restrictions
imposed by this Section 6.4 shall continue to apply to a former Company Stockholder,
notwithstanding the Company Stockholder’s withdrawal from the Company or Transfer of its shares of
the Company’s capital stock. Notwithstanding the foregoing, the restrictions on disclosure set
forth in this Section 6.4 shall not apply to any Confidential Information to the extent
that such information can be shown to have been (a) generally available to the public other than as
a result of a breach of the provisions of this Agreement; (b) already in the possession of the
receiving Person, without any restriction on disclosure, prior to any disclosure of such
information to the receiving Person by or on behalf of the Company or any Company Stockholder
pursuant to the terms of this Agreement or otherwise; (c) lawfully disclosed, without any
restriction on additional disclosure, to the receiving Person by a third party who is free lawfully
to disclose the same or (d) independently developed by the receiving Person without use of any
Confidential Information. Notwithstanding anything to the contrary contained in this Agreement, the
provisions of this Section 6.4 shall be in addition to, and shall not amend, supersede or replace,
any confidentiality or nondisclosure covenant or agreement contained in any employment agreement,
non-disclosure agreement or confidentiality agreement with any Company Stockholder that is, or was
previously, an employee or director of the Company.
6.5 Fiduciary Duties. The Company shall have no interest or expectation in, nor right
to be informed of, any corporate opportunity, and in the event the Series C Director, Tudor
Stockholders or their Affiliates acquires knowledge of a potential transaction or matter which may
be a corporate opportunity, such Series C Director, Tudor Stockholder or Affiliate shall, to the
fullest extent permitted by law, have no duty (fiduciary or otherwise) or obligation to communicate
or offer such corporate opportunity to the Company or any of its Affiliates or to any other
Directors or Company Stockholders and shall not, to the fullest extent permitted by law, be liable
to the Company or any of its Affiliates or stockholders for breach of any duty (fiduciary or
otherwise) as a Series C Director or Tudor Stockholder by reason of the fact that any Series C
Director, Tudor Stockholder or Affiliate acquires, creates, develops or seeks such corporate
opportunity for itself, directs such corporate opportunity to another person or entity, or
otherwise does not communicate information regarding such corporate opportunity to the Company or
its Affiliates or stockholders, and the Company, to the fullest extent permitted by law, waive and
renounce any claims that such business opportunity constituted a corporate opportunity that should
have been presented to the Company or any of its Affiliates, unless such corporate opportunity is
presented to or acquired, created or developed by, or otherwise comes into the possession of, a
Series C Director in such Person’s capacity as a Series C Director or Tudor Stockholder. For
purposes of this Agreement, “corporate opportunity” shall include any potential transaction,
investment or business opportunity or prospective economic or competitive advantage in which the
Company or any of its Affiliates could have any expectancy or interest. The provisions of this
Agreement, to the extent that they restrict the duties (including fiduciary duties) and liabilities
of a Director or Company Stockholder otherwise existing at law or in equity
or by operation of the preceding sentence, are agreed by the Company Stockholders to replace
such duties and liabilities of such Director or Company Stockholder.
- 14 -
ARTICLE VII
MISCELLANEOUS
MISCELLANEOUS
7.1. Legend. At all times from and after the Effective Date and prior to the earlier
of the closing of the Qualified IPO and termination of this Agreement in accordance with the terms
herein, the certificates or other evidence representing the Equity Securities shall bear a legend
in substantially the following form:
These Securities have not been registered under the Securities Act of 1933, as
amended (the “Act”), or state securities laws and cannot be offered, sold or
otherwise transferred in the absence of registration or the availability of an
exemption from registration under the Act and regulations promulgated thereunder
and applicable state securities laws. The voting and other rights with respect
to, and the sale or other disposition of, the securities represented by this
certificate are restricted by and subject to the provisions of a Second Amended
and Restated Stockholders Agreement dated as of February 6, 2007, a copy of which
is available for inspection at the offices of the Company.
Prior to any proposed Transfer by any Company Stockholder, if reasonably requested by the Company,
such Company Stockholder shall provide the Company with a written opinion from legal counsel
reasonably acceptable to the Company to the effect that an exemption from registration under the
Act and any applicable state securities laws is available with respect to the proposed Transfer and
that no such registration is required; provided, however, that it is agreed that the Company will
not require opinions of counsel for transactions made pursuant to Rule 144 promulgated under the
Act except in unusual circumstances.
7.2. Specific Performance. In addition to any other remedies which the Company Stockholders
may have at law or in equity, the Company and the Company Stockholders hereby acknowledge that the
harm which might result to the Company Stockholders from breaches by the Company or the Company
Stockholders of their respective obligations to take all necessary actions with respect to the
election and the removal of directors of the Company cannot be adequately compensated by damages.
Accordingly, the Company and each Company Stockholder agrees that each other Company Stockholder
shall have the right to have all obligations and undertakings set forth in Section 2.1 and
Articles III and IV specifically performed by the Company or the other Company
Stockholders, as the case may be, and that any other Company Stockholder shall have the right to
obtain an order or decree of such specific performance in any of the courts of the United States of
America or of any state or other political subdivision thereof.
7.3. Termination. Unless earlier terminated as provided herein, this Agreement, and
the agreements, covenants (except for the covenants contained in Section 6.3) and
obligations of the parties hereunder shall forthwith terminate and become wholly void and of no
effect upon the effective date of a Deemed Liquidation Event or effective date of the Qualified IPO
(provided, however, that if no closing of the Qualified IPO occurs, then this Agreement shall
automatically be reinstated).
7.4. Assignment. Neither the Company nor any Company Stockholder shall assign this
Agreement, in whole or in part, whether by operation of law or otherwise, unless (a) such person
shall have obtained the prior written consent of all the other parties or (b) such assignment is in
connection with a transfer of Equity Securities (i) not otherwise constituting a “Transfer”
hereunder or (ii) constituting a Transfer expressly permitted under Article III or
IV hereof. Any purported assignment of this Agreement contrary to the terms hereof shall be
null and void and of no force and effect.
- 15 -
7.5. Entire Agreement; Amendment; Waiver. This Agreement, including the Exhibits
hereto and the other documents and agreements expressly included by reference herein, constitutes
the entire agreement among the parties hereto with respect to the matters provided for herein, and
it supersedes all prior oral or written agreements, commitments or understandings with respect to
the matters provided for herein, including but not limited to the Amended Agreement and the
Original Agreement. This Agreement may not be amended (or amended and restated, as the case may
be) without the written consent of (i) the Company, (ii) a Series A Majority, (iii) a Series B
Majority; (iv) a Series C Majority; and (v) the Company Stockholders holding not less than a
majority of the total then-outstanding Equity Securities (determined on a Common Stock-equivalent
basis) held by all of the Company Stockholders then party hereto; provided, however, that any right
inuring to a class of Company Stockholders hereunder may be waived or amended as to all shares of
such class upon the written consent of the holders of at least sixty percent (60%) of the
outstanding shares of such class voting together as a single class (based on the number of shares
held by the holders on an as-if-converted, Common Stock-equivalent basis); provided, further, that
such waiver on behalf of the (x) Series B Investor Stockholders shall require the written consent
of the Series B Majority and (y) Series C Investor Stockholders shall require the written consent
of the Series C Majority. Notwithstanding the foregoing, the Company may amend Exhibit B to
accurately reflect the Company Stockholders which are a party to this Agreement and such amendments
to Exhibits B shall not require the above-described consents.
7.6. No Waiver. No delay or failure on the part of any party hereto in exercising any
right, power or privilege under this Agreement or under any other instruments given in connection
with or pursuant to this Agreement shall impair any such right, power or privilege or be construed
as a waiver of any default or any acquiescence therein. No single or partial exercise of any such
right, power or privilege shall preclude the further exercise of such right, power or privilege, or
the exercise of any other right, power or privilege. Without limiting the effect of Sections
7.4 and 7.5, no waiver shall be valid against any party hereto unless made in writing and
signed by the party against whom enforcement of such waiver is sought and then only to the extent
expressly specified therein.
7.7. No Third Party Beneficiaries. It is the explicit intention of the parties hereto
that no person or entity other than the parties hereto is or shall be entitled to bring any action
to enforce any provision of this Agreement against any of the parties hereto, and the covenants,
undertakings and agreements set forth in this Agreement shall be solely for the benefit of, and
shall be enforceable only by, the parties hereto or their respective successors, heirs, executors,
administrators, legal representatives and permitted assigns.
7.8. Binding Effect. This Agreement shall be binding on and shall inure to the benefit
of the parties hereto and their respective successors, heirs, executors, administrators, legal
representatives and permitted assigns.
7.9. Governing Law. This Agreement, the rights and obligations of the parties hereto,
and any claims or disputes relating thereto, shall be governed by and construed in accordance with
the laws of the State of Delaware (excluding the choice of law rules thereof).
7.10. Notices. All notices, demands, requests, or other communications which may be or
are required to be given, served, or sent by any party to any other party pursuant to this
Agreement shall be in writing and shall be hand-delivered or mailed by first-class, registered or
certified mail, return receipt requested, postage prepaid, addressed as follows:
- 16 -
| (i) | If to the Company: |
MAKO Surgical Corp.
0000 Xxxxx Xxxx
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Telephone: 000-000-0000
Facsimile: 954-927-0446
Attention: General Counsel
0000 Xxxxx Xxxx
Xxxx Xxxxxxxxxx, Xxxxxxx 00000
Telephone: 000-000-0000
Facsimile: 954-927-0446
Attention: General Counsel
With a copy (which shall no constitute notice) to:
Xxxxxxx Procter LLP
000 Xxx Xxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
000 Xxx Xxxx Xxxxxx, XX
Xxxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Attention: Xxxxxxxxxxx X. Xxxxx, Esq.
| (ii) | If to any Series A Investor Stockholder: |
To such Series A Investor Stockholder’s address shown in the Company Stockholder
registry held at the offices of the Company.
in each case, with a copy (which shall not constitute notice)to:
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Attn: Xxxxxx X. Xxxxx, Esq.
Xxxxxx, Xxxxx & Xxxxxxx LLP
000 Xxxxxxxx Xxxxxx
Xxxxxxxxx, XX 00000
Telephone: 000-000-0000
Fax: 000-000-0000
Attn: Xxxxxx X. Xxxxx, Esq.
| (iii) | If to any Series B Investor Stockholder: |
To such Series B Investor Stockholder’s address as set forth in Exhibit B hereto
in each case, with a copy (which shall not constitute notice) to:
Xxxxxx & Bird LLP
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Telephone: 000-000-0000
Fax: 000-000-0000
Attn: J. Xxxx Xxx, Esq.
Xxxxxx & Bird LLP
One Atlantic Center
0000 Xxxx Xxxxxxxxx Xxxxxx
Xxxxxxx, XX 00000-0000
Telephone: 000-000-0000
Fax: 000-000-0000
Attn: J. Xxxx Xxx, Esq.
- 17 -
| (iv) | If to any Series C Investor Stockholder: | ||
| To such Series C Investor Stockholder’s address as set forth in Exhibit C hereto | |||
| in each case, with a copy (which shall not constitute notice) to: Xxxxx, Xxxxxxxx & Flexner LLP 000 Xxxxxxxxx Xxxxxx 0xx Xxxxx Xxx Xxxx, XX 00000 Telephone: 000-000-0000 Fax: 000-000-0000 Attn: Xxxxxxx Xxxxx, Esq. |
|||
| (v) | If to any other Company Stockholder: | ||
| To such other Company Stockholder’s address shown in the Company Stockholder registry held at the offices of the Company. | |||
| (vi) | If to any Additional Stockholder: | ||
| To such Additional Stockholder’s address shown in the instrument of accession hereto delivered by such Additional Stockholder to the Company in accordance with Section 3.1.1 hereof. |
Each party may designate by notice in writing a new address to which any notice, demand, request or
communication may thereafter be so given, served or sent. Each notice, demand, request or
communication which shall be hand-delivered or mailed in the manner described above, shall be
deemed sufficiently given, served, sent, received or delivered for all purposes at such time as it
is delivered to the addressee (with the return receipt or the delivery receipt, being deemed
conclusive, but not exclusive, evidence of such delivery) or at such time as delivery is refused by
the addressee upon presentation.
7.11. Execution in Counterparts. To facilitate execution, this Agreement may be
executed by facsimile and in as many counterparts as may be required; and it shall not be necessary
that the signatures of, or on behalf of, each party, or that the signatures of all persons required
to bind any party, appear on each counterpart; but it shall be sufficient that the signature of, or
on behalf of, each party, or that the signatures of the persons required to bind any party, appear
on one or more of the counterparts. All counterparts shall collectively constitute a single
agreement. It shall not be necessary in making proof of this Agreement to produce or account for
more than a number of counterparts containing the respective signatures of, or on behalf of, all of
the parties hereto. Every Company Stockholder executing this Agreement represents and warrants
that such signature evidences acceptance of the terms and conditions set forth herein as to all
classes and types of Equity Securities of such Company Stockholder both owned as of the Effective
Date and acquired after the Effective Date.
[Signature Pages Follow]
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| The Company: | MAKO SURGICAL CORP. | |||||||||
| By: | /s/ Xxxxxxx X. Xxxxx, M.D. | |||||||||
| Name: | Xxxxxxx X. Xxxxx, M.D. | |||||||||
| Title: | President and Chief Executive Officer | |||||||||
| Company Stockholders: | Z-KAT, INC. | |||||||||
| By: | /s/ Xxxxxxxxxxx X. Xxxxx | |||||||||
| Name: | Xxxxxxxxxxx X. Xxxxx | |||||||||
| Title: | Interim Chief Executive Officer | |||||||||
| By: | /s/ Xxxxxxx X. Xxxxx, M.D. | |||||||||
| Xxxxxxx X. Xxxxx, M.D. | ||||||||||
| FERRÉ FAMILY TRUST | ||||||||||
| By: | /s/ Xxxxxxx X. Xxxxx, M.D. | |||||||||
| Xxxxxxx X. Xxxxx, M.D. | ||||||||||
| By: | /s/ Xxxx Xxxxx, MD, Ph.D. | |||||||||
| Xxxx Xxxxx, MD, Ph.D. | ||||||||||
| By: | /s/ Xxxxxxxx Xxxxxx, Ph.D. | |||||||||
| Xxxxxxxx Xxxxxx, Ph.D. | ||||||||||
| By: | /s/ Xxxxx X. Xxxxx | |||||||||
| Xxxxx X. Xxxxx | ||||||||||
| 1993 GF
PARTNERSHIP By: AVG Capital Corp., its General Partner |
||||
By: |
/s/ Aurum Xxxx | |||
Name: |
Aurum Xxxx | |||
Title: |
President | |||
[Signature Page to Stockholders Agreement]
By:
|
/s/ Xxxx Xxxxxxx Xxxxx Xxxxxxx | |||
| ITTA AND XXXXX XXXXXXX | ||||
| APERTURE CAPITAL II, L.P. | ||||||
| By: Aperture Venture Partners LLC, its General Partner | ||||||
| By: | /s/ Xxxxxxx X. Xxxxxxx | |||||
| Name: | Xxxxxxx X. Xxxxxxx | |||||
| Title: | Member | |||||
By: |
/s/ Xxxxx Betolaza | |||
| XXXXX BETOLAZA | ||||
By: |
/s/ Xxx X. Xxxxxx | |||
| XXX X. XXXXXX | ||||
| HSIOU-XXXX XXXX | ||||
/s/ Xxxx X. Xxxxxxx |
||||
| By: Xxxx X. Xxxxxxx, Power of Attorney | ||||
| XXXXXXX SUN XXXXX | ||||
/s/ Xxxx X. Xxxxxxx |
||||
| By: Xxxx X. Xxxxxxx, Power of Attorney | ||||
By: |
/s/ Xxxxxxx X. Xxxxxx | |||
| XXXXXXX X. XXXXXX | ||||
By: |
/s/ Xxxxxxxxxxx X. Xxxxx | |||
| Xxxxxxxxxxx X. Xxxxx | ||||
By: |
/s/ Xxxxx Xx Xxxxxxxx | |||
| XXXXX XX XXXXXXXX | ||||
By: |
/s/ Xxxxxx X. Xxxxxxx Xxxxx X. Xxxxxxx | |||
| DR. & XXX. XXXXXX X. & XXXXX X. XXXXXXX | ||||
By: |
/s/ Xxx Xxxxxxxxxxxx | |||
| XXX XXXXXXXXXXXX | ||||
[Signature Page to Stockholders Agreement]
| XXXXXXX XXXXXX | ||||
/s/ Xxxx X. Xxxxxxx |
||||
| By: Xxxx X. Xxxxxxx, Power of Attorney | ||||
IVY HEALTHCARE CAPITAL, L.P.
By: Ivy Capital Partners I, LLC, as General Partner
By: Ivy Capital Partners, LLC, as General Manager
By: Ivy Capital Partners I, LLC, as General Partner
By: Ivy Capital Partners, LLC, as General Manager
| By: | /s/ Xxxxxxx X. Xxxxxx, Xx. | |||||
| Name: Xxxxxxx X. Xxxxxx, Xx. | ||||||
| Title: Co-Manager | ||||||
| By: | /s/ Xxxxxx X. Xxxxxx | |||||
| Name: Xxxxxx X. Xxxxxx | ||||||
| Title: Co-Manager | ||||||
XXXXXXXX & COMPANY, INC.
By: |
/s/ Xxxxxx X. Xxxxx | |||
Name: |
Xxxxxx X. Xxxxx | |||
Title: |
Assistant General Counsel and SVP | |||
By: |
/s/ Xxxx X. Xxxxxxxxx | |||
| XXXX X. XXXXXXXXX | ||||
By: |
/s/ Xxxx Xxxxx | |||
| XXXX XXXXX | ||||
By: |
/s/ Xxxxxx Xxxxxxx | |||
| XXXXXX XXXXXXX | ||||
| XXXXXXX XXX | ||||
/s/ Xxxx X. Xxxxxxx |
||||
| By: Xxxx X. Xxxxxxx, Power of Attorney | ||||
MDS LIFE SCIENCES TECHNOLOGY FUND II NC LIMITED PARTNERSHIP
By: MDS LSTF II (NCGP) Inc., its General Partner
By: MDS LSTF II (NCGP) Inc., its General Partner
| By: | /s/ Graysanne Xxxxxx Xxxxx Van der Velden | |||||
| Name: | Graysanne Xxxxxx Xxxxx Van der Velden | |||||
| Title: | ||||||
[Signature Page to Stockholders Agreement]
MDS LIFE SCIENCES TECHNOLOGY FUND II QUEBEC LIMITED PARTNERSHIP
By: MDS LSTF II (QGP) Inc., its General Partner
By: MDS LSTF II (QGP) Inc., its General Partner
| By: | /s/ Graysanne Xxxxxx Xxxxx Van der Velden | |||||
| Name: | Graysanne Xxxxxx Xxxxx Van der Velden | |||||
| Title: | ||||||
| MK INVESTMENT CO. | ||||
By: |
/s/ Xxxxxxx Xxxx | |||
| Name: | Xxxxxx Xxxx | |||
| Title: | Authorized Signatory | |||
MLII CO-INVESTMENT FUND NC LIMITED PARTNERSHIP
By: MLII (NCGP) Inc., its General Partner
By: MLII (NCGP) Inc., its General Partner
| By: | /s/ Graysanne Xxxxxx Xxxxx Van der Velden | |||||
| Name: | Graysanne Xxxxxx Xxxxx Van der Velden | |||||
| Title: | ||||||
By:
|
/s/ Xxxx Xxxx | |||
| XXXX XXXX | ||||
By: |
/s/ Xxx Xxxxxx | |||
| XXX XXXXXX | ||||
By: |
/s/ Xxxx Xxxxxxxxx | |||
| XXXX XXXXXXXXX | ||||
By: |
/s/ Xxxxx Xxxxxxx | |||
| XXXXX XXXXXXX | ||||
| PIERREPONT FAMILY INVESTMENT PARTNERSHIP I, L.P. | ||||
By: |
/s/ Xxxx X. Xxxxxxx | |||
| Name: Xxxx X. Xxxxxxx, Power of Attorney | ||||
| PRESIDENT LIFE SCIENCES CAYMAN CO. LTD. | ||||
By: |
/s/ Te-Cheng Tu | |||
| Name: | Te-Cheng Tu | |||
| Title: | President | |||
[Signature Page to Stockholders Agreement]
By: |
/s/ Xxxxxx X. Xxxxxxxxx | |||
| XXXXXX X. XXXXXXXXX | ||||
| SMITHFIELD FIDUCIARY LLC | ||||
By: |
/s/ Xxxx X. Chill | |||
| Xxxx X. Chill, an authorized person | ||||
| SYCAMORE VENTURE CAPITAL, L.P. | ||||
By: |
/s/ Xxxx X. Xxxxxxx | |||
| Name: | Xxxx X. Xxxxxxx | |||
| Title: | President | |||
By: |
/s/ Xxxxxxx X. Xxxxx | |||
| XXXXXXX X. XXXXX | ||||
By: |
/s/ Xxxxxxxx Xxxxxxxxxx | |||
| XXXXXXXX XXXXXXXXXX | ||||
By: |
/s/ Xxxxx Xxxxxx | |||
| XXXXX XXXXXX | ||||
| KILIN TO | ||||
/s/
Xxxx X. Xxxxxxx |
||||
| By: Xxxx X. Xxxxxxx, Power of Attorney | ||||
| XXXXXXXX XXXXX | ||||
/s/
Xxxx X. Xxxxxxx |
||||
| By: Xxxx X. Xxxxxxx, Power of Attorney | ||||
| TUDOR INVESTMENT CORPORATION, as investment adviser to each of The Raptor Global Portfolio Ltd., The Tudor BVI Global Portfolio Ltd. and The Altar Rock Fund L.P. |
||||
By: |
/s/ Xxxxxxx X. Xxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxx | |||
| Title: | Managing Director | |||
[Signature Page to Stockholders Agreement]
| TUDOR PROPRIETARY TRADING, L.L.C. | ||||
By: |
/s/ Xxxxxxx X. Xxxxxxx | |||
| Name: | Xxxxxxx X. Xxxxxxx | |||
| Title: | Managing Director | |||
| VENTUREVEST LTD. | ||||
By: |
/s/ Xxxxxxx X. Xxxx | |||
| Name: | Xxxxxxx X. Xxxx | |||
| Title: | Vice President | |||
| JONAS C.T. XXXX | ||||
Xxxx X. Xxxxxxx |
||||
| By: Xxxx X. Xxxxxxx, Power of Attorney | ||||
By: |
/s/ XXXX X. XXXXXXX | |||
| XXXX X. XXXXXXX | ||||
| XXXXXXX CHILDREN IRREVOCABLE TRUST | ||||
By: |
/s/ Xxxx X. Xxxxxxx | |||
| Name: | Xxxx X. Xxxxxxx | |||
| Title: | Trustee | |||
| XXXXXXX MEDITECH EQUITY PARTNERS LP | ||||
| By: Xxxxxxx Meditech Partners, LLC, its General Partner | ||||
| By: | /s/ Xxxxxx X. Grande | |||||
| Name: | Xxxxxx X. Grande | |||||
| Title: | Chief Administration Officer |
[Signature Page to Stockholders Agreement]
MEDITECH ADVISORS, LLC
|
||||
By: |
/s/ Estan Machover | |||
Name: |
Estan Machover | |||
| Witness: | ||||
By: |
||||
[Signature Page to Stockholders Agreement]
COUNTERPART SIGNATURE PAGE AND JOINDER
TO MAKO SURGICAL CORP.
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
TO MAKO SURGICAL CORP.
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
The undersigned hereby agrees to be bound by all of the provisions, terms and conditions
of the Second Amended and Restated Stockholders Agreement of MAKO Surgical Corp., dated
February 6, 2007, as if an original signatory thereto.
Date: |
||||||||||||
| Name: | ||||||||||||
| Title: | ||||||||||||
| Attention: | ||||||||||||
| (telephone) | ||||||||||||
| (fax) | ||||||||||||
EXHIBIT A
TO SERIES C
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
DATED AS OF FEBRUARY 6, 2007
TO SERIES C
SECOND AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
DATED AS OF FEBRUARY 6, 2007
CERTAIN DEFINED TERMS
“Act” means the Securities Act of 1933, as amended.
“Additional Period” has the meaning set forth in Section
4.2.
“Additional Stockholder” has the meaning set forth in
Section 3.1.1.
“Affiliate” means: (a) with respect to a person, any member of such person’s family;
(b) with respect to an entity, any officer, director, stockholder, partner or investor of or in
such entity or of or in any Affiliate of such entity; and (c) with respect to a person or entity,
any person or entity which directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, such person or entity. With respect to the MDS
Entities, “Affiliate” also means any other MDS Entity that is a Company Stockholder, MDS
Capital Corp. or any corporation, trust, partnership, limited liability company, or other form of
entity which is an investment fund to which MDS Capital Corp. or any of its affiliates provides
investment, management or advisory services. With respect to the Tudor Stockholders,
“Affiliate” also means any other Tudor Stockholder that is a Company Stockholder, or any
Related Entities. In addition, MediTech Advisors and Xxxxxxx Meditech Equity Partners, LP, shall be
deemed to be Affiliates of each other for all purposes of this Agreement.
“Agreement” means this Second Amended and Restated Stockholders Agreement.
“Amended Agreement” has the meaning set forth in the Recitals.
“Approved Option Plan” shall mean any plan, arrangement, agreement, transaction,
commitment or arrangement to authorize, grant or issue shares of the Company’s Common Stock
(through Options Equity or otherwise) to employees, officers, or directors of, or contractors,
consultants, or advisors to the Company pursuant to stock option or purchase plans, warrants, stock
bonuses, or awards, contracts or other arrangements, adopted and/or awarded with Requisite
Approval.
“Associate” has the meaning as set forth in Rule 12b-2 of the Securities Exchange Act
of 1934 (as amended).
“Audit Committee” has the meaning set forth in Section 2.3.
“Board” has the meaning set forth in Section 2.1.
“Business Day” means Monday through Friday and shall exclude any federal or bank
holidays observed in Miami, Florida.
“Bylaws” has the meaning set forth in Article II.
“CEO” has the meaning set forth in Section 2.1(e).
“Change of Control Transaction” shall mean (a) the acquisition of the stock of the
Company by another entity or person (including, without limitation, any reorganization, merger, or
consolidation but, excluding any merger effected exclusively for the purpose of changing the
domicile of the Company), unless the Company Stockholders of record, as constituted immediately
prior to such acquisition will,
immediately after such acquisition (by virtue of securities issued or sold as consideration for the
Company’s acquisition or otherwise), hold at least fifty percent (50%) of the voting power of the
surviving or acquiring entity; or (b) the sale, lease, transfer or other disposition of all or
substantially all of the assets of the Company.
“Charter” has the meaning set forth in Article II.
“Closing” has the meaning set forth in Section 3.2.7.
“Common Director” has the meaning set forth in Section 2.1(e).
“Common Stock” means the common stock of the Company, par value $.001 per share
“Common Stockholder” has the meaning set forth in Article II.
“Company” means MAKO Surgical Corp., a Delaware corporation, or any successor thereto.
“Company Acceptance” has the meaning set forth in Section 3.2.2.
“Company Stockholder” has the meaning set forth in the Recitals.
“Compensation Committee” has the meaning set forth in Section 2.3.
“Confidential Information” means all documents and information, whether written or
oral (including, without limitation, confidential and proprietary information with respect to
customers, sales, marketing, production, costs, business operations and assets), of the Company.
“Conversion Shares” has the meaning set forth Section 4.1.
“Deemed Liquidation Event” shall mean any of the following transactions or series of
related transactions: (a) any liquidation, dissolution, or winding up of the Company, whether
voluntary or involuntary; (b) a Change of Control Transaction; (c) the Company’s making an
assignment for the benefit of creditors or commencing any bankruptcy, dissolution, termination of
corporate existence, or any similar action; or (d) the acceleration upon of any indebtedness of the
Company in excess of $1,000,000 in the aggregate unless in the case of (b) or (d) above, waived by
each of the (i) a Series A Majority; (ii) a Series B Majority and (iii) a Series C Majority.
“Designating Stockholder” has the meaning set forth in Section
2.1(g).
“Director”
has the meaning set forth in Section 2.1(g).
“Xx. Xxxxxx” has the meaning set forth in the Recitals.
“Xx. Xxxxx” has the meaning set forth in the Recitals.
“Xx. Xxxxx” has the meaning set forth in the Recitals.
“Drag-Along Stockholder” has the meaning set forth in Section
3.4.
“Drag-Along Transaction” has the meaning set forth in Section
3.4.
“Effective Date” has the meaning set forth in the Recitals.
“Election Period” has the meaning set forth in Section 4.2.
“Equity Securities” means any and all shares of Common Stock, the Preferred Stock or
any other shares of the Company’s preferred stock, the Options Equity and any other warrant or
rights to subscribe for or to purchase, or any options for the purchase of any other stock,
security or interest in the Company whether or not convertible into or exchangeable for, with or
without consideration, Common Stock, Preferred Stock, any other shares of the Company’s preferred
stock, or other security of the Company or any share appreciation rights, phantom share rights or
similar rights.
“Full Purchasing Series B Investor Stockholder” has the meaning set forth in
Section 4.2.
“Full Purchasing Series C Investor Stockholder” has the meaning set forth in
Section 4.2.
“Independent” has the meaning set forth in Section 2.1(f).
“Independent Director” has the meaning set forth in Section 2.1(f).
“Investor Stockholder Group” has the meaning set forth in Section 4.4.
“Line of Business” shall mean knee replacement surgery.
“MDS Entities” shall mean MDS Life Sciences Technology Fund II NC Limited Partnership,
MDS Life Sciences Technology Fund II Quebec Limited Partnership and MLII Co-Investment Fund NC
Limited Partnership.
“MKCO” has the meaning set forth in Section 2.1(j).
“New Securities” has the meaning set forth in Section 4.1.
“Offered Shares” has the meaning set forth in Section 3.2.1.
“Operating Plan” has the meaning set forth in Section 6.2(c).
“Options Equity” shall mean stock options, stock equivalents and other rights and
interests to acquire (as subject to vesting and such other terms and conditions as approved by the
Board) shares of Common Stock or any stock or securities convertible into or exchangeable for
Common Stock.
“Original Agreement” has the meaning set forth in the Recitals.
“Oversubscribing Series A Stockholder” has the meaning set forth in
Section 3.2.5.
“Oversubscribing Series B Stockholder” has the meaning set forth in
Section 3.2.4.
“Oversubscribing Series C Stockholder” has the meaning set forth in
Section 3.2.3.
“Person” means any individual, corporation, partnership, limited liability company,
firm, joint venture, association, joint-stock company, trust, estate, unincorporated organization,
governmental or regulatory body or other entity.
“Preferred Investor Stockholders” means collectively, the Series A Investor
Stockholders, the Series B Investor Stockholders and the Series C Investor Stockholders.
“Preferred Investor Stockholder Participation Notice” has the meaning set forth in
Section 3.3.
“Preferred Majority” has the meaning set forth in Section 2.1(i).
“Preferred Preferences” has the meaning set forth in Section 3.4.
“Preferred Stock” has the meaning set forth in the
Recitals.
“Principal Business” shall mean orthopedic medical
devices.
“Purchase Agreements” has the meaning set forth in the
Recitals.
“Qualified IPO” shall mean a firm commitment underwritten public offering of shares of
Common Stock of the Company pursuant to an effective registration statement filed under the Act,
covering the offer and sale of Common Stock for the account of the Company which results in
aggregate net proceeds to the Company from the offering of not less than $25,000,000 and a price
per share (prior to underwriter commissions and offering expenses) of not less than $4.44 per share
(appropriately adjusted for any recapitalization, stock splits, combinations, consolidations,
subdivisions or other similar events occurring with respect to the Common Stock after the Effective
Date) and following which offering the Common Stock is listed on a national securities exchange
approved by the Board (including the Series C Director) or admitted to quotation on the NASDAQ
National Market or Capital Market.
“Qualifying Holders” means each Company Stockholder holding at least two percent (2%)
of the Equity Securities of the Company (on an as-if-converted, Common Stock-equivalent basis).
“Related Entities” means, with respect to any Tudor Stockholder, any entities for
which any of the Tudor Entities or its Affiliates serve as a general partner and/or investment
advisor or in a similar capacity, and all mutual funds or other pooled investment vehicles or
entities under the control or management of any of the Tudor Entities or its Affiliates. For
purposes of this Agreement, (a) “Tudor Entities” means each of the following: Tudor
Investment Corporation, Tudor Group Holdings LLC, their respective Affiliates, and any Affiliate or
Affiliated Group of Tudor Investment Corporation and/or Tudor Group Holdings LLC, and (b) with
respect to the Tudor Entities, “Affiliated Group” has the meaning given to it in Section 1504 of the Internal
Revenue Code of 1986, as amended, and in addition includes any analogous combined, consolidated, or
unitary group, as defined under any applicable state, local or foreign income tax law.
“Requisite Approval” has the meaning set forth in Section 4.1.
“Sale Notice” has the meaning set forth in Section 4.2.
“Selling Common Stockholder” has the meaning set forth in Section
3.2.1.
“Series A Director” has the meaning set forth in Section
2.1(c).
“Series A Investor Stockholder” has the meaning set forth in the
Recitals.
“Series A Majority” shall mean the holders of at least sixty percent (60%) of the
outstanding Series A Preferred Stock voting together as a single class (based on the number of
shares held by the holders on an as-if-converted, Common Stock-equivalent basis).
“Series A Preferred Stock” has the meaning set forth in the Recitals.
“Series A Purchase Agreement” has the meaning set forth in the
Recitals.
“Series A Remainder Shares” has the meaning set forth in Section
3.2.5.
“Series A Stockholder Notice” has the meaning set forth in
Section 3.2.5.
“Series A Unsubscribed Shares” has the meaning set forth in
Section 3.2.5.
“Series B Director” has the meaning set forth in Section
2.1(b).
“Series B Director Condition” has the meaning set forth in Section
2.1(b).
“Series B Investor Stockholder” has the meaning set forth in the
Recitals.
“Series B Majority” shall mean the holders of at least sixty-seven percent (67%) of
the outstanding Series B Preferred Stock voting together as a single class (based on the number of
shares held by the holders on an as-if-converted, Common Stock-equivalent basis).
“Series B Preferred Stock” has the meaning set forth in the
Recitals.
“Series B Purchase Agreement” has the meaning set forth in the
Recitals.
“Series B Remainder Shares” has the meaning set forth in
Section 3.2.4.
“Series B Stockholder Notice” has the meaning set forth in
Section 3.2.4.
“Series B Unsubscribed Shares” has the meaning set forth in Section 3.2.4.
“Series C Director” has the meaning set forth in Section 2.1(d).
“Series C Investor Stockholder” has the meaning set forth in the Recitals.
“Series C Majority” shall mean the holders of at least seventy percent (70%) of the
outstanding Series C Preferred Stock voting together as a single class (based on the number of
shares held by the holders on an as-if-converted, Common Stock-equivalent basis).
“Series C Preferred Stock” has the meaning set forth in the
Recitals.
“Series C Purchase Agreement” has the meaning set forth in the
Recitals.
“Series C Remainder Shares” has the meaning set forth in
Section 3.2.3.
“Series C Stockholder Notice” has the meaning set forth in
Section 3.2.3.
| “ Series C Unsubscribed Shares” has the meaning set forth in Section 3.2.3. |
“Third Party” means any person or entity excluding each of the following: (a) the
Company; (b) each of the Preferred Investor Stockholders and any of their respective successors,
officers, directors, associates, partners (limited and general) or Affiliates; or (c) each of the
Company Stockholders that are a party to this Agreement as of, but immediately prior to, the
relevant date of determination for purposes of any Transfer.
“Third Party Offer” has the meaning set forth in Section 3.2.1.
“Third Party Transferee” has the meaning set forth in Section 3.2.6.
“Transfer” means the sale, gift, mortgage, pledge, exchange, assignment or other
disposition or transfer, including a disposition under judicial order, legal process, execution,
attachment or enforcement of an encumbrance, but shall not include: (a) a transfer by a Company
Stockholder to such Company Stockholder’s spouse, children or grandchildren, or to trustees,
custodians or family limited liability companies for their benefit or to other persons or entities
for estate-planning purposes, as a gift or otherwise without consideration, provided, however, that
any and all such transferees shall hold the Equity Securities subject to the terms of this
Agreement and, as a condition precedent to such transfers, shall be required to execute and deliver
an agreement and instrument of accession to this Agreement, as annexed hereto and entitled
“Counterpart Signature Page and Joinder” or in a form and substance otherwise satisfactory to the
Board; or (b) a transfer by a Preferred Investor Stockholder to any limited or general partner or
any Affiliate of such Preferred Investor Stockholder.
“Transfer Notice” has the meaning set forth in Section 3.2.1.
“Tudor Series C Investor Stockholders” means the holders of the Series C Preferred
Stock issued to the Tudor Stockholders and their Affiliates on the date hereof, and their
successors and assigns.
“Tudor Stockholders” means, collectively, The Raptor Global Portfolio Ltd., The Tudor
BVI Global Portfolio Ltd., Tudor Proprietary Trading, L.L.C. and The Altar Rock Fund L.P. and their
Affiliates who become Stockholders of the Company from time to time (each, a “Tudor
Stockholder”).
“Unpurchased B Pro Rata Shares” has the meaning set forth in Section
4.2.
“Unpurchased C Pro Rata Shares” has the meaning set forth in Section
4.2.
“Z-KAT”
means Z-KAT, Inc., a Florida corporation, or any successor thereto.