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Confidential Draft Submission Amendment No. 1 submitted to the Securities and Exchange Commission on April 4, 2014.
This draft registration statement has not been filed publicly with the Securities and Exchange Commission and all information contained herein remains confidential.

Registration No. 333-            


UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549



AMENDMENT NO. 1 TO
FORM S-1
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933



Mirna Therapeutics, Inc.
(Exact name of Registrant as specified in its charter)

Delaware
(State or other jurisdiction of
incorporation or organization)
  2834
(Primary Standard Industrial
Classification Code Number)
  26-1824804
(I.R.S. Employer
Identification Number)

2150 Woodward Street, Suite 100
Austin, TX 78744
(512) 901-0900

(Address, including zip code, and telephone number, including area code, of Registrant's principal executive offices)



Paul Lammers, M.D., M.Sc.
President & Chief Executive Officer
Mirna Therapeutics, Inc.
2150 Woodward Street, Suite 100
Austin, TX 78744
(512) 901-0900
(Name, address, including zip code, and telephone number, including area code, of agent for service)



Copies to:

Alan C. Mendelson, Esq.
Mark V. Roeder, Esq.
Latham & Watkins LLP
140 Scott Drive
Menlo Park, CA 94025
Telephone: (650) 328-4600
Facsimile: (650) 463-2600

 

Scott D. Elliott, Esq.
Patrick O'Brien, Esq.
Ropes & Gray LLP
3 Embarcadero Center
San Francisco, CA 94111
Telephone: (415) 315-6300
Facsimile: (415) 315-6350



Approximate date of commencement of proposed sale to the public:
As soon as practicable after the effective date of this Registration Statement.

         If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933, check the following box.    o

         If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

         If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

         If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o

         Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act.

Large accelerated filer o   Accelerated filer o   Non-accelerated filer ý
(Do not check if a
smaller reporting company)
  Smaller reporting company o

CALCULATION OF REGISTRATION FEE

       
 
Title of each class of securities
to be registered

  Proposed maximum
aggregate offering
price(1)

  Amount of
registration fee(1)

 

Common Stock, $0.001 par value per share

  $     $  

 

(1)
Estimated solely for the purpose of calculating the amount of the registration fee in accordance with Rule 457(o) under the Securities Act of 1933, as amended. Includes shares that the underwriters have the option to purchase.



         The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

   



EXPLANATORY NOTE

        This Amendment No. 1 to Form S-1 Registration Statement of Mirna Therapeutics, Inc. is being filed solely to include exhibits to the Registration Statement. Accordingly, Part I, the form of prospectus, has been omitted from this filing.



PART II

Information Not Required in Prospectus

Item 13.    Other Expenses of Issuance and Distribution.

        The following table sets forth the costs and expenses, other than the underwriting discounts and commissions, payable by the registrant in connection with the sale of Common Stock being registered. All amounts are estimates except for the Securities and Exchange Commission, or SEC, registration fee, the FINRA filing fee and The NASDAQ Global Market listing fee.

Item
  Amount to
be paid
 

SEC registration fee

  $         *  

FINRA filing fee

    *  

The NASDAQ Global Market listing fee

    *  

Printing and engraving expenses

    *  

Legal fees and expenses

    *  

Accounting fees and expenses

    *  

Blue Sky, qualification fees and expenses

    *  

Transfer Agent fees and expenses

    *  

Miscellaneous expenses

    *  
       

Total

  $ *  
       
       

*
To be completed by amendment

Item 14.    Indemnification of Directors and Officers.

        As permitted by Section 102 of the Delaware General Corporation Law, we have adopted provisions in our amended and restated certificate of incorporation and bylaws that limit or eliminate the personal liability of our directors for a breach of their fiduciary duty of care as a director. The duty of care generally requires that, when acting on behalf of the corporation, directors exercise an informed business judgment based on all material information reasonably available to them. Consequently, a director will not be personally liable to us or our stockholders for monetary damages for breach of fiduciary duty as a director, except for liability for:

        These limitations of liability do not affect the availability of equitable remedies such as injunctive relief or rescission. Our amended and restated certificate of incorporation also authorizes us to indemnify our officers, directors and other agents to the fullest extent permitted under Delaware law.

        As permitted by Section 145 of the Delaware General Corporation Law, our amended and restated bylaws provide that:

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        Our amended and restated certificate of incorporation, to be attached as Exhibit 3.3 hereto, and our amended and restated bylaws, to be attached as Exhibit 3.5 hereto, provide for the indemnification provisions described above and elsewhere herein. We intend to enter into separate indemnification agreements with our directors and officers which may be broader than the specific indemnification provisions contained in the Delaware General Corporation Law. These indemnification agreements generally require us, among other things, to indemnify our officers and directors against liabilities that may arise by reason of their status or service as directors or officers, other than liabilities arising from willful misconduct. These indemnification agreements also generally require us to advance any expenses incurred by the directors or officers as a result of any proceeding against them as to which they could be indemnified. In addition, we have purchased a policy of directors' and officers' liability insurance that insures our directors and officers against the cost of defense, settlement or payment of a judgment in some circumstances. These indemnification provisions and the indemnification agreements may be sufficiently broad to permit indemnification of our officers and directors for liabilities, including reimbursement of expenses incurred, arising under the Securities Act of 1933, as amended, or the Securities Act.

        The form of Underwriting Agreement, to be attached as Exhibit 1.1 hereto, provides for indemnification by the underwriters of us and our officers who sign this Registration Statement and directors for specified liabilities, including matters arising under the Securities Act.

Item 15.    Recent Sales of Unregistered Securities.

        The following list sets forth information as to all securities we have sold since January 1, 2011, which were not registered under the Securities Act.

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        We claimed exemption from registration under the Securities Act for the sale and issuance of securities in the transactions described in paragraphs (1) through (5) above by virtue of Section 4(2) and/or Regulation D promulgated thereunder as transactions not involving any public offering. All of the purchasers of unregistered securities for which we relied on Section 4(2) and/or Regulation D represented that they were accredited investors as defined under the Securities Act. We claimed such exemption on the basis that (a) the purchasers in each case represented that they intended to acquire the securities for investment only and not with a view to the distribution thereof and that they either received adequate information about the registrant or had access, through employment or other relationships, to such information and (b) appropriate legends were affixed to the stock certificates issued in such transactions.

        We claimed exemption from registration under the Securities Act for the sales and issuances of securities in the transactions described in paragraphs (6) and (7) above under Section 4(2) of the Securities Act, in that such sales and issuances did not involve a public offering, or under Rule 701 promulgated under the Securities Act, in that they were offered and sold either pursuant to written compensatory plans or pursuant to a written contract relating to compensation, as provided by Rule 701.

Item 16.    Exhibits and Financial Statement Schedules.

        (a)   Exhibits. See the Exhibit Index attached to this Registration Statement, which is incorporated by reference herein.

        (b)   Financial Statement Schedules. Schedules not listed above have been omitted because the information required to be set forth therein is not applicable or is shown in the financial statements or notes thereto.

Item 17.    Undertakings.

        Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the SEC such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question of whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

        The undersigned Registrant hereby undertakes that:

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        The undersigned Registrant hereby undertakes to provide to the underwriters at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriters to permit prompt delivery to each purchaser.

        The undersigned Registrant undertakes that in a primary offering of securities of the undersigned registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned Registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

II-4



Signatures

        Pursuant to the requirements of the Securities Act of 1933, as amended, the Registrant has duly caused this Amendment to Registration Statement on Form S-1 to be signed on its behalf by the undersigned, thereunto duly authorized, in Austin, Texas, on                        , 2014.

    MIRNA THERAPEUTICS, INC.

 

 

By:

 

 

Paul Lammers, M.D., M.Sc.
President and Chief Executive Officer


Power of Attorney

        KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Paul Lammers and Jon Irvin, and each of them acting individually, as his or her true and lawful attorneys-in-fact and agents, each with full power of substitution, for him or her in any and all capacities, to sign any and all amendments to this Registration Statement, including post-effective amendments or any abbreviated registration statement and any amendments thereto filed pursuant to Rule 462(b) increasing the number of securities for which registration is sought, and to file the same, with all exhibits thereto and other documents in connection therewith, with the SEC, granting unto said attorneys-in-fact and agents, with full power of each to act alone, full power and authority to do and perform each and every act and thing requisite and necessary to be done in connection therewith, as fully for all intents and purposes as he or she might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or his, her or their substitute or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act, this Amendment to Registration Statement has been signed by the following persons in the capacities and on the dates indicated.

Signature
 
Title
 
Date

 

 

 

 

 
  

Paul Lammers, M.D., M.Sc.
  Director, President and Chief Executive Officer
(Principal Executive Officer)
             , 2014

  

Jon Irvin

 

Chief Financial Officer
(Principal Financial and Accounting Officer)

 

           , 2014

 

Michael Powell, Ph.D.

 

Chairman of the Board

 

           , 2014

 

Corey Goodman, Ph.D.

 

Director

 

           , 2014

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Signature
 
Title
 
Date

 

 

 

 

 
  

Elaine V. Jones, Ph.D.
  Director              , 2014

  

Ed Mathers

 

Director

 

           , 2014

 

Clay Siegall, Ph.D.

 

Director

 

           , 2014

  

Matthew Winkler, Ph.D.

 

Director

 

           , 2014

II-6



Exhibit Index

Exhibit
Number
  Description
1.1*   Form of Underwriting Agreement.

3.1   

 

Fifth Amended and Restated Certificate of Incorporation, currently in effect.

3.2* 

 

Form of Sixth Amended and Restated Certificate of Incorporation, effecting a reverse stock split, to be in effect prior to the consummation of this offering.

3.3* 

 

Form of Amended and Restated Certificate of Incorporation, to be in effect immediately prior to the consummation of this offering.

3.4   

 

Bylaws, currently in effect.

3.5* 

 

Form of Amended and Restated Bylaws, to be in effect immediately prior to the consummation of this offering.

4.1   

 

Reference is made to Exhibits 3.1 through 3.5.

4.2* 

 

Form of Common Stock Certificate.

4.3   

 

Second Amended and Restated Investor Rights Agreement, dated as of October 22, 2012, among Mirna Therapeutics, Inc. and certain of its stockholders, as amended.

5.1* 

 

Opinion of Latham & Watkins LLP.

10.1* 

 

Services Agreement, dated January 1, 2013, by and between Mirna Therapeutics, Inc. and Asuragen, Inc.

10.2(A)†  

 

Cross License Agreement, dated November 3, 2009, by and between Mirna Therapeutics, Inc. and Asuragen, Inc.

10.2(B)†  

 

First Amendment to the Cross License Agreement, dated September 28, 2012, by and between Mirna Therapeutics, Inc. and Asuragen, Inc.

10.3(A)†  

 

License Agreement, dated December 22, 2011, by and between Mirna Therapeutics, Inc. and Marina Biotech, Inc.

10.3(B)†  

 

Side Letter to License Agreement, dated December 22, 2011, by and between Mirna Therapeutics, Inc. and Marina Biotech, Inc.

10.3(C)†  

 

Side Letter to License Agreement, dated November 16, 2012, by and between Mirna Therapeutics, Inc. and Marina Biotech, Inc.

10.3(D)†  

 

Amendment No. 1 to License Agreement, dated December 27, 2013, by and between Mirna Therapeutics, Inc. and Marina Biotech, Inc.

10.3(E)†  

 

Side Letter to License Agreement, dated January 9, 2014, by and between Mirna Therapeutics, Inc. and Marina Biotech, Inc.

10.4†  

 

Amended and Restated Agreement, dated February 6, 2014, by and between Mirna Therapeutics, Inc. and Yale University.

10.5†  

 

License Agreement, dated March 10, 2013, by and between Mirna Therapeutics, Inc. and University of Zurich.

10.6†  

 

Cancer Research Grant Contract, dated August 31, 2010, by and between Mirna Therapeutics, Inc. and the Cancer Prevention and Research Institute of Texas.

10.7(A)#  

 

2008 Long Term Incentive Plan, as amended.

10.7(B)#  

 

Form of Notice of Stock Option Grant under 2008 Long Term Incentive Plan.

10.7(C)#  

 

Form of Stock Option Agreement under 2008 Long Term Incentive Plan.

Exhibit
Number
  Description

10.8#*

 

2014 Equity Incentive Award Plan.

10.9#*

 

Form of Indemnity Agreement for directors and officers.

23.1* 

 

Consent of independent registered public accounting firm.

23.2* 

 

Consent of Latham & Watkins LLP (included in Exhibit 5.1).

24.1* 

 

Power of Attorney. Reference is made to the signature page to the Registration Statement.

*
To be filed by amendment.

Portions of this exhibit (indicated by asterisks) have been omitted pursuant to a request for confidential treatment and this exhibit has been filed separately with the SEC.

#
Indicates management contract or compensatory plan.



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EXPLANATORY NOTE
PART II Information Not Required in Prospectus
Signatures
Power of Attorney
Exhibit Index

Exhibit 3.1

 

FIFTH AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION

OF

MIRNA THERAPEUTICS, INC.

(a Delaware corporation)

 

(Pursuant to Sections 228, 242 and 245 of the

General Corporation Law of the State of Delaware)

 

Mirna Therapeutics, Inc. (the “Company”), a corporation organized and existing under the General Corporation Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the “DGCL”), hereby certifies as follows:

 

1.                                      The Company was originally incorporated on December 20, 2007 pursuant to the DGCL.  A Second Amended and Restated Certificate of Incorporation of the Company was filed with the Secretary of State of Delaware on December 4, 2009.  A Third Amended and Restated Certificate of Incorporation of the Company was filed with the Secretary of State of Delaware on August 10, 2011. A Fourth Amended and Restated Certificate of Incorporation of the Company was filed with the Secretary of State of Delaware on October 22, 2012 (the “Original Certificate”).

 

2.                                      Pursuant to Sections 228, 242 and 245 of the DGCL, this Fifth Amended and Restated Certificate of Incorporation (this “Restated Certificate”) restates and integrates and further amends the provisions of the Original Certificate.

 

3.                                      The text of the Original Certificate is hereby amended and restated in its entirety to read as follows:

 

ARTICLE ONE

 

The name of this corporation is Mirna Therapeutics, Inc. (the “Company”).

 

ARTICLE TWO

 

The address of the registered office of the Company in the State of Delaware is Corporation Trust Center, 1209 Orange Street, in the City of Wilmington, County of New Castle, Delaware 19801.  The name of its registered agent at such address is The Corporation Trust Company.

 

ARTICLE THREE

 

The purpose of the Company is to engage in any lawful act or activity for which a corporation may be organized under the DGCL.

 

1



 

ARTICLE FOUR

 

A.                                    The Company is authorized to issue two classes of stock to be designated, respectively, Common Stock and Preferred Stock.  The total number of shares that the Company is authorized to issue is 179,000,783 shares, 95,000,000 shares of which shall be Common Stock (the “Common Stock”), and 84,000,783 shares of which shall be Preferred Stock (the “Preferred Stock”).  The Common Stock shall have a par value of $0.001 per share and the Preferred Stock shall have a par value of $0.001 per share.

 

B.                                    [Reserved.]

 

C.                                    Subject to the provisions of this Restated Certificate, the Company may purchase, directly or indirectly, its own shares to the extent that may be allowed by law.

 

D.                                    3,192,083 of the authorized shares of Preferred Stock are hereby designated Series A Preferred Stock (the “Series A Preferred Stock”), 540,341 of the authorized shares of Preferred Stock are hereby designated Series B Preferred Stock (the “Series B Preferred Stock” and together with the Series A Preferred Stock, the “Junior Preferred Stock”), 10,914,647 of the authorized shares of Preferred Stock are hereby designated Series B-1 Preferred Stock (the “Series B-1 Preferred Stock”) and 69,353,712 of the authorized shares of Preferred Stock are hereby designated Series C Preferred Stock (the “Series C Preferred Stock” and collectively with the Junior Preferred Stock and Series B-1 Preferred Stock, the “Series Preferred”).

 

E.                                    The “Effective Time” means the time upon which this Restated Certificate becomes effective pursuant to the DGCL.

 

F.                                     The “Original Issue Price” means, collectively, the Series A Original Issue Price, Series B Original Issue Price, Series B-1 Original Issue Price and Series C Original Issue Price.

 

G.                                   The “Series A Original Issue Price” means $2.00 per share, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Series A Preferred Stock after the Effective Time.

 

H.                                   The “Series B Original Issue Price” means $2.776 per share, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Series B Preferred Stock after the Effective Time.

 

I.                                        The “Series B-1 Original Issue Price” means $0.458 per share, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Series B-1 Preferred Stock after the Effective Time.

 

J.                                      The “Series C Original Issue Price” means $0.509 per share, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Series C Preferred Stock after the Effective Time.

 

K.                                   The rights, preferences, privileges, restrictions and other matters relating to the Series Preferred are as follows:

 

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1.                                      Dividend Rights.

 

(a)                                 From and after the applicable date of the issuance of any share of Series C Preferred Stock, dividends at the rate per annum of eight percent (8%) of the Series C Original Issue Price shall accrue on such share of Series C Preferred Stock (the “Series C Accruing Dividends”), payable in cash or in kind, at the written election of the Majority Series C Holders (as defined in Section 6 hereof), on a pari passu basis among the holders of shares of Series C Preferred Stock and prior and in preference to any payment of any dividend on shares of Series B-1 Preferred Stock, Junior Preferred Stock and Common Stock, when, as and if declared by the Company’s board of directors (the “Board”) but in no event later than upon the earliest to occur of (i) any Liquidation Event (as defined below), (ii) any conversion of shares of Series C Preferred Stock into shares of Common Stock in accordance with Section 5 and (iii) any redemption of the Series C Preferred Stock in accordance with Section 6 (each, a “Series C Accruing Dividend Event”); provided, however, that, notwithstanding anything herein to the contrary, payment of Series C Accruing Dividends in connection with the conversion of shares of Series C Preferred Stock into shares of Common Stock in accordance with Section 5 shall be governed by the operation of Section 5(d) below.  The Series C Accruing Dividends shall accrue from day to day, whether or not declared, and shall be cumulative; provided, however, that except as set forth in this Section 1(a), Section 3, Section 5 and Section 6, the Series C Accruing Dividends shall be payable only when, as and if declared by the Board and the Company shall otherwise be under no obligation to pay the Series C Accruing Dividends; provided, further, that payment of Series C Accruing Dividends in connection with a Series C Accruing Dividend Event is subject to an Accrual End Date as determined by the Board pursuant to Section 1(g) below.  From and after the Effective Time, the Company shall not declare, pay or set aside any dividends on shares of any other class or series of capital stock of the Company (other than dividends on shares of Common Stock payable in shares of Common Stock) unless (in addition to the obtaining of any consents required elsewhere in this Restated Certificate) the holders of shares of Series C Preferred Stock shall first receive a dividend on each outstanding share of Series C Preferred Stock in an amount at least equal to the sum of (i) the amount of the aggregate Series C Accruing Dividends then accrued on such share of Series C Preferred Stock and not previously paid plus (ii) (A) in the case of a dividend on Common Stock or any class or series that is convertible into Common Stock, that dividend per share of Series C Preferred Stock as would equal the product of (1) the dividend payable on each share of such class or series determined, if applicable, as if all shares of such class or series had been converted into Common Stock and (2) the number of shares of Common Stock issuable upon conversion of a share of Series C Preferred Stock, in each case calculated on the record date for determination of holders entitled to receive such dividend or (B) in the case of a dividend on any class or series that is not convertible into Common Stock, at a rate per share of Series C Preferred Stock determined by (1) dividing the amount of the dividend payable on each share of such class or series of capital stock by the original issuance price of such class or series of capital stock (as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to such class or series after the Effective Time) and (2) multiplying such fraction by an amount equal to the Series C Original Issue Price; provided that if the Company declares, pays or sets aside, on the same date, a dividend on

 

3



 

shares of more than one class or series of capital stock of the Company, the dividend payable to the holders of Series C Preferred Stock pursuant to this Section 1(a) shall be calculated based upon the dividend on the class or series of capital stock that would result in the highest Series C Preferred Stock dividend.

 

(b)                                 From and after the Effective Time, holders of shares of Series B-1 Preferred Stock, in preference to the holders of shares of Junior Preferred Stock and Common Stock, shall be entitled to receive, when, as and if declared by the Board, but only out of funds that are legally available therefor, dividends on each outstanding share of Series B-1 Preferred Stock.  Such dividends shall be payable only when, as and if declared by the Board and shall be non-cumulative.

 

(c)                                  From and after the Effective Time, holders of shares of Junior Preferred Stock, in preference to the holders of shares of Common Stock, shall be entitled to receive, when, as and if declared by the Board, but only out of funds that are legally available therefor, dividends on each outstanding share of Junior Preferred Stock.  Such dividends shall be payable only when, as and if declared by the Board and shall be non-cumulative.

 

(d)                                 So long as any shares of Series Preferred are outstanding, the Company shall not pay or declare any dividend, whether in cash or property, or make any other distribution on the Common Stock, or purchase, redeem or otherwise acquire for value any shares of Common Stock until all dividends as set forth in Sections 1(a), 1(b) and 1(c) above on the Series Preferred have been paid or declared and set apart, except for:

 

(i)                                    acquisitions of shares of Common Stock by the Company pursuant to agreements that permit the Company to repurchase such shares at cost (or the lesser of cost or fair market value) upon termination of services to the Company; or

 

(ii)                                acquisitions of shares of Common Stock in exercise of the Company’s right of first refusal to repurchase such shares.

 

(e)                                  If dividends are paid on any share of Common Stock, the Company shall, subject to the dividend rights of Series C Preferred Stock under Section 1(a) above, pay an additional dividend on each outstanding share of Series B-1 Preferred Stock and Junior Preferred Stock in a per share amount (on an as-if-converted-to-Common Stock basis) equal to the amount paid or set aside for each share of Common Stock

 

(f)                                   The provisions of Section 1(d) and 1(e) shall not apply to a dividend payable in Common Stock (in which case the provisions of Section 5(f) shall apply), or any redemption or repurchase of any outstanding securities of the Company pursuant to this Restated Certificate or otherwise unanimously approved by the Board.

 

(g)                                 Notwithstanding anything herein to the contrary, on or prior to a Series C Accruing Dividend Event, the Board may designate a date by which

 

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the Series C Accruing Dividend shall no longer accrue pursuant to Section 1(a); provided, that such date shall be no greater than 14 days prior to the effectiveness of such Series C Accruing Dividend Event (the “Accrual End Date”). In the event that the Series C Accruing Dividend Event does not occur within 14 days of the Accrual End Date determined by the Board, the determination of such Accrual End Date shall terminate and be of no further force or effect and the Board may determine a new Accrual End Date pursuant to this Section 1(g) or the Series C Accruing Dividends will continue to accrue pursuant to Section 1(a) above as if no Accrual End Date had been designated.

 

2.                                      VOTING RIGHTS.

 

(a)                                 General Rights.  In addition to any class or series voting right provided under this Restated Certificate, applicable law or otherwise, on any matter presented to the stockholders of the Company for their action or consideration at any meeting of stockholders of the Company (or by written consent of stockholders in lieu of a meeting), each holder of shares of Series Preferred shall be entitled to the number of votes equal to the number of shares of Common Stock into which such shares of Series Preferred could be converted pursuant to Section 5 hereof immediately after the close of business on the record date fixed for such meeting, or the effective date of such written consent, and shall have voting rights and powers equal to the voting rights and powers of the Common Stock and shall be entitled to notice of any stockholders’ meeting in accordance with the bylaws of the Company, as amended from time to time (the “Bylaws”).  Except as otherwise provided herein or as required by law, the holders of shares of Series Preferred and the holders of shares of Common Stock shall vote together, and not as separate classes, on all matters to come before the stockholders.  The number of authorized shares of Common Stock may be increased or decreased (but not below the number of shares of Common Stock then outstanding and the number of shares of Common Stock issuable upon conversion of shares of Preferred Stock that are then outstanding) by the affirmative vote of the holders of a majority of the then-outstanding shares of capital stock of the Company, voting together as a single class on an as-if-converted basis, irrespective of the provisions of Section 242(b)(2) of the DGCL.

 

(b)                                 Election of Directors.  Subject to the provisions of this Section 1(g)(b), (i) the holders of record of the shares of Series C Preferred Stock, voting together as a separate class, shall be entitled to elect three (3) directors of the Company (the “Series C Directors”), (ii) the holders of record of the shares of Junior Preferred Stock, voting together as a single class on an as-if converted basis, shall be entitled to elect one (1) director of the Company (the “Junior Preferred Director” and together with the Series C Directors, the “Preferred Directors”) and (iii) the holders of record of the shares of Common Stock and Series Preferred, voting together as a single class on an as-if-converted basis, shall be entitled to elect three (3) directors of the Company.  Any director elected as provided in the preceding sentence may be removed without cause by, and only by, the affirmative vote of the holders of the shares of the class or series of capital stock entitled to elect such director or directors, given either at a special meeting of such stockholders duly called for that purpose or pursuant to a written consent of stockholders.  If the holders of shares of Series C Preferred Stock, Junior Preferred Stock or Common Stock and Series Preferred, as the case may be, fail to elect a sufficient

 

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number of directors to fill all directorships for which they are entitled to elect directors, voting exclusively and as a separate class, pursuant to the first sentence of this Section 1(g)(b), then any directorship not so filled shall remain vacant until such time as the holders of the Series C Preferred Stock, Junior Preferred Stock or Common Stock and Series Preferred, as the case may be, elect a person to fill such directorship by vote or written consent in lieu of a meeting; and no such directorship may be filled by stockholders of the Company other than by the stockholders of the Company that are entitled to elect a person to fill such directorship, voting exclusively and as a separate class.  At any meeting held for the purpose of electing a director, the presence in person or by proxy of the holders of a majority of the outstanding shares of the class or series of capital stock entitled to elect such director shall constitute a quorum for the purpose of electing such director.  A vacancy in any directorship filled by the holders of any class or series of capital stock shall be filled only by vote or written consent in lieu of a meeting of the holders of such class or series of capital stock or by any remaining director or directors elected by the holders of such class or series pursuant to this Section 1(g)(b).

 

(c)                                  Separate Vote of the Series Preferred.

 

(i)                                    In addition to any other vote or consent required herein or by law, from and after the Effective Time, the Company shall not, and shall not permit its subsidiaries to, in either case directly or indirectly by amendment, merger, reorganization, consolidation or otherwise, do any of the following without (in addition to any other vote required by law or this Restated Certificate) the written consent or affirmative vote of the holders of at least a majority of the then-outstanding shares of Series Preferred, voting together as a single class on an as-if-converted basis (the “Required Holders”), given in writing or by vote at a meeting, and any such act or transaction entered into without such consent or vote shall be null and void ab initio, and of no force or effect:

 

(A)                               amend, alter or repeal any provision of this Restated Certificate or the Bylaws;

 

(B)                               reclassify, alter or amend any outstanding shares of securities of the Company into shares having rights, preferences or privileges senior to or on a parity with any Series Preferred;

 

(C)                               create, authorize the creation of or issue, or obligate itself to create, authorize the creation of or issue, any capital stock or other security of any class or series, including, without limitation, any other security convertible into or exercisable or exchangeable for any equity security of any class or series, having rights, preferences or privileges senior to or on a parity with any Series Preferred;

 

(D)                               authorize or effect any merger, consolidation or reorganization of the Company or any Deemed Liquidation Event;

 

(E)                               authorize or effect any acquisition of another entity or all or substantially all of the assets of any entity, or permit any subsidiary of the Company to do so;

 

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(F)                                liquidate, dissolve or wind up the Company;

 

(G)                              increase or decrease the authorized number of members of the Board;

 

(H)                              declare or pay any dividends or make any other distribution, directly or indirectly, with respect to any shares of Common Stock or Series Preferred now or hereafter outstanding; provided, however, that this restriction shall not apply to the Series C Accruing Dividends; or

 

(I)                                   repurchase, redeem or otherwise acquire any of the Company’s equity securities (including, without limitation, warrants, options, and other rights to acquire equity securities); provided, however, that this restriction shall not apply to (i) the repurchase of shares of Common Stock by the Company at cost (or the lesser of cost or the then-current fair market value thereof) from directors or employees of, or consultants or advisers to, the Company or any subsidiary pursuant to agreements in effect as of the Effective Time or agreements approved by the Board, including a majority of the Preferred Directors, after the Effective Time under which the Company has the option to repurchase such shares upon the termination of employment with or service to the Company or any subsidiary of the Company, (ii) the purchase of shares of Common Stock upon exercise by the Company of its right of first refusal with respect to such shares and (iii) a redemption pursuant to Section 6.

 

(ii)                                Without limiting the foregoing, the Company shall not, and shall not permit its subsidiaries to, in either case directly or indirectly by amendment, merger, reorganization, consolidation or otherwise, alter or change the powers, preferences or special rights of one or more series of the Series Preferred so as to affect them adversely, but not so affect the entire class of Series Preferred, without (in addition to any other vote required by law or this Restated Certificate) the written consent or affirmative vote of the holders of at least a majority of the then-outstanding shares of the series of Series Preferred so affected, voting together as a single class on an as-if-converted basis, given in writing or by vote at a meeting, and any such act or transaction entered into without such consent or vote shall be null and void ab initio, and of no force or effect; provided, however, that, for the avoidance of doubt, the creation of a new class or series of equity security having a preference senior to, or on parity with, a series of Series Preferred, including, but not limited to, with respect to dividend rights, liquidation preferences or redemption rights, shall not be deemed to adversely alter or change the powers, preferences or special rights of such series of Series Preferred.

 

3.                                      LIQUIDATION RIGHTS.

 

(a)                                 Upon any liquidation, dissolution, or winding up of the Company, whether voluntary or involuntary, or any Deemed Liquidation Event (as defined below) (each a “Liquidation Event”), before any distribution or payment may be made to the holders of any shares of Series B-1 Preferred Stock, Junior Preferred Stock or Common Stock, the holders of shares of Series C Preferred Stock then outstanding, by reason of their ownership of such stock, shall be entitled to be paid out of the assets of the

 

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Company legally available for distribution to its stockholders an amount per share equal to the Series C Original Issue Price, plus any Series C Accruing Dividends accrued but unpaid thereon, whether or not declared, together with any other dividends declared but unpaid thereon (the “Series C Liquidation Preference”).  If upon any Liquidation Event, the assets of the Company legally available for distribution to its stockholders shall be insufficient to make payment in full to the holders of shares of Series C Preferred Stock of the Series C Liquidation Preference, then such assets shall be distributed among the holders of shares of Series C Preferred Stock at the time outstanding, ratably in proportion to the full amounts to which they would otherwise be respectively entitled under this Section 3(a).

 

(b)                                 Upon any Liquidation Event, after the payment in full of the Series C Liquidation Preference as set forth in Section 3(a) above and before any distribution or payment may be made to the holders of any shares of Junior Preferred Stock or Common Stock, the holders of shares of Series B-1 Preferred Stock then outstanding, by reason of their ownership of such stock, shall be entitled to be paid out of the assets of the Company legally available for distribution to its stockholders an amount per share equal to the product of (i) the Series B-1 Original Issue Price multiplied by (ii) 1.5 (the “Series B-1 Base Liquidation Amount”), plus any dividends declared but unpaid thereon (the “Series B-1 Liquidation Preference”).  If upon any Liquidation Event, the remaining assets of the Company legally available for distribution to its stockholders (after payment in full of the Series C Liquidation Preference pursuant to Section 3(a)) shall be insufficient to make payment in full to the holders of shares of Series B-1 Preferred Stock of the Series B-1 Liquidation Preference, then such remaining assets shall be distributed among the holders of shares of Series B-1 Preferred Stock at the time outstanding, ratably in proportion to the full amounts to which they would be respectively entitled under this Section 3(b).

 

(c)                                  Upon any Liquidation Event, after payment in full of the Series C Liquidation Preference as set forth in Section 3(a) above and the Series B-1 Liquidation Preference as set forth in Section 3(b) above and before any distribution or payment may be made to the holders of any shares of Common Stock, the holders of Junior Preferred Stock then outstanding, by reason of their ownership of such stock, shall be entitled to be paid out of the assets of the Company legally available for distribution to its stockholders, on a pari passu basis, an amount per share equal to (i) with respect to the Series B Preferred Stock, (x) the Series B Original Issue Price if the shares of Series B-1 Preferred Stock have been converted or, pursuant to Section 3(e), been deemed to be converted into shares of Common Stock immediately prior to the Liquidation Event, plus any dividends declared but unpaid thereon, or (y) $2.106, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Series B Preferred Stock, plus any dividends declared but unpaid thereon ((x) or (y), as the case may be, the “Series B Liquidation Preference”), and (ii) with respect to the Series A Preferred Stock, (A) the Series A Original Issue Price if the shares of Series B-1 Preferred Stock have been converted or, pursuant to Section 3(e), been deemed to be converted into shares of Common Stock immediately prior to the Liquidation Event, plus any dividends declared but unpaid thereon, or (B) $1.330, as adjusted for any stock dividends, combinations, splits, recapitalizations and the like with respect to the Series A

 

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Preferred Stock, plus any dividends declared but unpaid thereon ((A) or (B), as the case may be, the “Series A Liquidation Preference” and collectively with the Series B Liquidation Preference, the Series B-1 Liquidation Preference and the Series C Liquidation Preference, the “Liquidation Preferences”).  If upon any Liquidation Event, the remaining assets of the Company legally available for distribution to its stockholders (after payment in full of the Series C Liquidation Preference pursuant to Section 3(a) and the Series B-1 Liquidation Preference pursuant to Section 3(b)) shall be insufficient to make payment in full to the holders of Junior Preferred Stock of the Series B Liquidation Preference and Series A Liquidation Preference, then such remaining assets shall be distributed among the holders of shares of Junior Preferred Stock at the time outstanding, ratably in proportion to the full amounts to which they would be respectively entitled under this Section 3(c).

 

(d)                                 Upon any Liquidation Event, after payment in full of the aggregate Liquidation Preferences pursuant to Sections 3(a), (b) and (c) above, the remaining assets of the Company legally available for distribution or payment to its stockholders shall be distributed ratably among the holders of shares of Common Stock, the holders of shares of Series B Preferred Stock and the holders of shares of Series C Preferred Stock, on a pari passu and as-if-converted basis.

 

(e)                                  Notwithstanding Sections 3(a) through (d) above, solely for purposes of determining the amount each holder of shares of Series Preferred is entitled to receive with respect to a Liquidation Event, each series of Series Preferred shall be treated as if such holder of Series Preferred had converted such holder’s shares of Series Preferred into shares of Common Stock immediately prior to the Liquidation Event if, as a result of an actual conversion of such Series Preferred (including taking into account the operation of this Section 3(e)), such holder of such Series Preferred would receive (with respect to such Series Preferred), in the aggregate, an amount greater than the amount that would be distributed to such holder of such Series Preferred if such holder had not converted such Series Preferred into shares of Common Stock.  If any holder of any Series Preferred shall be treated as if such holder had converted shares of Series Preferred into shares of Common Stock pursuant to this Section 3(e), then such holder shall not be entitled to receive any distribution pursuant to Section 3(a), (b) or (c) that would otherwise be made to such holder of Series Preferred.

 

4.                                      DEEMED LIQUIDATION EVENTS.

 

(a)                                 The Company shall not have the power to effect a Deemed Liquidation Event unless the consideration payable to the stockholders of the Company or the Company in such Deemed Liquidation Event shall be allocated among the holders of capital stock of the Company pursuant to Section 3 above.

 

(b)                                 For the purposes of this Restated Certificate, a “Deemed Liquidation Event” means (i) any consolidation or merger of the Company or a subsidiary of the Company with or into any other corporation or other entity or person, or any other corporate reorganization, in which the stockholders of the Company immediately prior to such consolidation, merger or reorganization own, immediately after

 

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such consolidation, merger or reorganization, less than fifty percent (50%) of the voting power of the surviving or resulting entity or, if the surviving or resulting entity is a wholly owned subsidiary of another corporation, the parent corporation of the surviving or resulting entity (excluding any consolidation, merger or reorganization effected exclusively to change the domicile of the Company), (ii) any transfer, whether by merger, consolidation or otherwise, in a single transaction or series of related transactions to which the Company is a party, and in which all of the proceeds from such transaction or series of related transactions are received by the Company in cash, of the Company’s voting securities to a person or group of affiliated persons (as defined in Rule 13d-5(b) of the Securities Exchange Act of 1934, as amended) if, after such transfer, such person or group of affiliated persons would hold fifty percent (50%) or more of the outstanding voting securities of the Company (excluding any transaction or series of transactions for bona fide equity financing purposes in which cash proceeds are received by the Company or indebtedness of the Company is cancelled or converted or a combination thereof), or (iii) a sale, exclusive license, lease or other disposition of, in a single transaction or series of related transactions, all or substantially all of the assets, technology or intellectual property of the Company and its subsidiaries taken as a whole, or the sale or disposition, whether by merger or otherwise, of one or more subsidiaries of the Company if substantially all of the assets of the Company and its subsidiaries taken as a whole are held by such subsidiary or subsidiaries, except where such sale, exclusive license, lease or disposition is to a wholly-owned subsidiary of the Company.

 

(c)                                  In any Deemed Liquidation Event, if the consideration to be received is securities of a corporation or other property other than cash, its value will be deemed its fair market value as determined in good faith by the Board on the date such determination is made (taking into account, if applicable, any restrictions on the free marketability of such assets, securities or other property, arising under applicable securities laws or otherwise).

 

(d)                                 Notwithstanding any other provision set forth in Section 3 or this Section 4, in the event that any consideration payable to the Company or its stockholders in connection with any Deemed Liquidation Event is contingent upon the occurrence of any event or the passage of time (including, without limitation, any deferred purchase price payments, installment payments, payments made in respect of any promissory note issued in such transaction, payments from escrow, purchase price adjustment payments or payments in respect of “earnouts” or holdbacks), (i) such consideration shall not be deemed received by the Company or its stockholders or available for distribution to such stockholders unless and until such consideration is indefeasibly received by the Company or its stockholders in accordance with the terms of such Deemed Liquidation Event, (ii) the portion of such consideration that is not subject to any contingencies (the “Initial Consideration”) shall be allocated among the holders of capital stock of the Company in accordance with Section 3 as if the Initial Consideration were the only consideration payable in connection with such Deemed Liquidation Event, and (iii) any additional consideration which becomes payable to the stockholders of the Company upon satisfaction of contingencies shall be allocated among the holders of capital stock of the Company in accordance with Section 3 after taking into account the previous payment of the Initial Consideration as part of the same transaction.

 

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5.                                      CONVERSION RIGHTS.

 

The holders of Series Preferred shall have the following rights with respect to the conversion of such Series Preferred into shares of Common Stock (the “Conversion Rights”):

 

(a)                                 Optional Conversion.  Subject to and in compliance with the provisions of this Section 5, each share of Series Preferred may be converted, at the option of the holder thereof, at any time after the issuance of such share and without the payment of additional consideration by the holder thereof, into fully paid and nonassessable shares of Common Stock.  The number of shares of Common Stock to which a holder of shares of Series Preferred shall be entitled upon conversion of such shares of Series Preferred shall be the product obtained by multiplying the Series A Conversion Rate, Series B Conversion Rate, Series B-1 Conversion Rate or Series C Conversion Rate, as applicable (each as defined and determined as provided in Section 5(b)), by the number of shares of Series A Preferred Stock, Series B Preferred Stock, Series B-1 Preferred Stock or Series C Preferred Stock, as applicable, being converted.

 

(b)                                 Conversion Rate.  The conversion rate in effect at any time for conversion of shares of Series A Preferred Stock (the “Series A Conversion Rate”) shall be the quotient obtained by dividing the Series A Original Issue Price by the Series A Conversion Price, calculated as provided in Section 5(c). The conversion rate in effect at any time for conversion of shares of Series B Preferred Stock (the “Series B Conversion Rate”) shall be the quotient obtained by dividing the Series B Original Issue Price by the Series B Conversion Price, calculated as provided in Section 5(c).  The conversion rate in effect at any time for conversion of shares of Series B-1 Preferred Stock (the “Series B-1 Conversion Rate”) shall be the quotient obtained by dividing the Series B-1 Original Issue Price by the Series B-1 Conversion Price, calculated as provided in Section 5(c).  The conversion rate in effect at any time for conversion of shares of Series C Preferred Stock (the “Series C Conversion Rate”) shall be the quotient obtained by dividing the Series C Original Issue Price by the Series C Conversion Price, calculated as provided in Section 5(c).

 

(c)                                  Conversion Price.  The conversion price for the Series A Preferred Stock shall initially be the Series A Original Issue Price (the “Series A Conversion Price”), the conversion price for the Series B Preferred Stock shall initially be the Series B Original Issue Price (the “Series B Conversion Price”), the conversion price for the Series B-1 Preferred Stock shall initially be the Series B-1 Original Issue Price (the “Series B-1 Conversion Price”) and the conversion price for the Series C Preferred Stock shall initially be the Series C Original Issue Price (the “Series C Conversion Price”).  The Series A Conversion Price, the Series B Conversion Price, the Series B-1 Conversion Price and the Series C Conversion Price, in each case, shall be adjusted from time to time in accordance with this Section 5.  All references to “Conversion Price” herein shall mean the Series A Conversion Price, the Series B Conversion Price, Series B-1 Conversion Price or the Series C Conversion Price as applicable, in each case as so adjusted.

 

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(d)                                 Mechanics of Conversion.

 

(i)                                    Conversion into Common Stock. Each holder of shares of Series Preferred who desires to convert the same into shares of Common Stock pursuant to Section 5(a) shall surrender the certificate or certificates therefor, duly endorsed, at the office of the Company or any transfer agent for the Series Preferred, and shall give written notice to the Company at such office that such holder elects to convert the same.  Such notice shall state the number of shares of Series Preferred being converted.  Thereupon, subject to the restrictions of Section 5(d)(ii) below, the Company shall promptly (i) issue and deliver at such office to such holder a certificate or certificates for the number of shares of Common Stock to which such holder is entitled upon conversion in accordance with the provisions hereof and a certificate for the number (if any) of the shares of Series Preferred represented by the surrendered certificate or certificates that were not converted into Common Stock, (ii) pay all declared but unpaid dividends on the shares of Series Preferred being converted in accordance with Section 1 and all Series C Accruing Dividends accrued and unpaid thereon, whether or not declared, and (iii) pay in cash, at the fair market value of shares of Common Stock determined in good faith by the Board as of the date of conversion, the value of any fractional share of Common Stock otherwise issuable to any holder of shares of the Series Preferred as provided in Section 5(l).  Such conversion shall be deemed to have been made at the close of business on the date of such surrender by such holder of the certificate of certificates representing the shares of Series Preferred to be converted, and the person entitled to receive the shares of Common Stock issuable upon such conversion shall be treated for all purposes as the record holder of such shares of Common Stock on such date.

 

(ii)                                Payment of Series C Accruing Dividends in Connection with an Initial Public Offering. Notwithstanding anything herein to the contrary, in the event that the Company shall make any payment of Series C Accruing Dividends in connection with the conversion of shares of Series C Preferred Stock into shares of Common Stock in accordance with this Section 5, and if such conversion is conditioned upon and/or effective immediately prior to the occurrence of an Initial Public Offering (as defined below), (i) the payment of any Series C Accruing Dividends in connection with such Initial Public Offering shall be paid in kind, effective immediately prior to the consummation of such Initial Public Offering, in the form of the issuance of shares of Common Stock and not involve the payment of any cash; (ii) the fair market value of each share of Common Stock to be used when determining the number of shares to be issued as a result of such Series C Accruing Dividends shall be as reflected on the cover of the final prospectus filed with the Securities and Exchange Commission in connection with such Initial Public Offering as the price being offered to the public per share of Common Stock; and (iii) no fractional shares shall be issued or cash shall be paid by the Company in connection with the unconverted portion of any Series C Accruing Dividends as a result of the Company rounding down to the nearest whole share.

 

(e)                                  Adjustment for Stock Splits and Combinations.  If at any time or from time to time after the Effective Time the Company effects a subdivision of the outstanding shares of Common Stock without a corresponding subdivision of the

 

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Preferred Stock, then the Conversion Price for each series of Series Preferred in effect immediately before that subdivision shall be proportionately decreased so that the number of shares of Common Stock issuable upon conversion of each share of such series shall be increased in proportion to such increase in the aggregate number of shares of Common Stock outstanding.  Conversely, if at any time or from time to time after the Effective Time the Company combines the outstanding shares of Common Stock into a smaller number of shares without a corresponding combination of the Preferred Stock, the Conversion Price for each series of Series Preferred in effect immediately before the combination shall be proportionately increased so that the number of shares of Common Stock issuable upon conversion of each share of such series shall be decreased in proportion to such decrease in the aggregate number of shares of Common Stock outstanding.  Any adjustment under this Section 5(ii) shall become effective at the close of business on the date the subdivision or combination becomes effective.

 

(f)                                   Adjustment for Common Stock Dividends and Distributions.  If at any time or from time to time after the Effective Time the Company pays to holders of shares of Common Stock a dividend or other distribution in additional shares of Common Stock without a corresponding dividend or other distribution to holders of Series Preferred, then the Conversion Price for each series of Series Preferred in effect immediately before such event shall be decreased as of the time of such issuance as provided below:

 

(i)                                    The Conversion Price for each series of Series Preferred shall be adjusted by multiplying the Conversion Price then in effect for such series by a fraction equal to:

 

(A)                               the numerator of which is the total number of shares of Common Stock issued and outstanding immediately prior to the time of such issuance, and

 

(B)                               the denominator of which is the total number of shares of Common Stock issued and outstanding immediately prior to the time of such issuance plus the number of shares of Common Stock issuable in payment of such dividend or distribution.

 

(ii)                                If the Company fixes a record date to determine which holders of shares of Common Stock are entitled to receive such dividend or other distribution, then the Conversion Price shall be fixed as of the close of business on such record date and the number of shares of Common Stock shall be calculated immediately prior to the close of business on such record date; and

 

(iii)                            Notwithstanding the foregoing, (A) if such record date is fixed and such dividend is not fully paid or if such distribution is not fully made on the date fixed therefor, then the Conversion Price for each series of Series Preferred shall be recomputed accordingly as of the close of business on such record date and thereafter the Conversion Price shall be adjusted pursuant to this Section 5(f) to reflect the actual payment of such dividend or distribution; and (B) no such adjustment shall be

 

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made if the holders of Series C Preferred Stock, Series B-1 Preferred Stock, Series B Preferred Stock or Series A Preferred Stock, as applicable, simultaneously receive a dividend or other distribution of shares of Common Stock in a number equal to the number of shares of Common Stock as they would have received if all outstanding shares of Series C Preferred Stock, Series B-1 Preferred Stock, Series B Preferred Stock or Series A Preferred Stock, as applicable, had been converted into Common Stock on the date of such event.

 

(g)                                 Adjustment for Reclassification, Exchange, Substitution, Reorganization, Merger or Consolidation.  Subject to the provisions of Section 2(c), if at any time or from time to time after the Effective Time, the shares of Common Stock issuable upon the conversion of the Series Preferred are converted or exchanged into the same or a different number of shares of any class or classes of securities, cash or other property, whether by recapitalization, reclassification, merger, consolidation or otherwise (other than a Deemed Liquidation Event as defined in Section 4 or a subdivision or combination of shares or stock dividend or a reorganization, merger, consolidation or sale of assets provided for elsewhere in this Section 5), in any such event each holder of shares of Series Preferred shall then have the right to convert such shares into the kind and amount of securities, cash or other property receivable upon such recapitalization, reclassification, merger, consolidation or other change by holders of the maximum number of shares of Common Stock into which such shares of Series Preferred could have been converted immediately prior to such recapitalization, reclassification, merger, consolidation or other change, all subject to further adjustment as provided herein or with respect to such other securities or property by the terms thereof.  In any such case, appropriate adjustment shall be made in the application of the provisions of this Section 5 with respect to the rights of the holders of shares of Series Preferred after such recapitalization, reclassification, merger, consolidation or other change to the end that the provisions of this Section 5 (including adjustment of the applicable Conversion Price then in effect and the number of shares issuable upon conversion of the shares of Series Preferred) shall be applicable, after that event and as nearly equivalent as practicable, in relation to any securities or other property thereafter deliverable upon conversion of the shares of Series Preferred.

 

(h)                                 Sale of Shares Below Conversion Price.

 

(i)                                    If at any time or from time to time after the Effective Time, the Company issues or sells, or is deemed by the express provisions of this Section 5(h) to have issued or sold, Additional Shares of Common Stock (as defined below), other than as provided in Section 5(f) or 5(g) above, without consideration or for an Effective Price (as defined below) less than the Series C Conversion Price in effect immediately prior to such issuance or sale (a “Qualifying Dilutive Issuance”), then and in each such case, the Conversion Price for each series of Series Preferred in effect immediately prior to such issuance or sale shall be reduced, as of the opening of business on the date of such issuance or sale, to a price determined by multiplying the Conversion Price for such series of Series Preferred in effect immediately prior to such issuance or sale by a fraction equal to:

 

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(A)                               the numerator of which shall be (1) the number of shares of Common Stock deemed outstanding (as determined below) immediately prior to such issuance or sale, plus (2) the number of shares of Common Stock that the Aggregate Consideration (as defined below) received by the Company for the total number of Additional Shares of Common Stock so issued would purchase at the Conversion Price in effect immediately prior to such issuance or sale; and

 

(B)                               the denominator of which shall be the number of shares of Common Stock deemed outstanding (as determined below) immediately prior to such issue or sale plus the total number of Additional Shares of Common Stock so issued.

 

For the purposes of the preceding sentence, the number of shares of Common Stock deemed to be outstanding as of a given date shall be the sum of (1) the number of shares of Common Stock outstanding, (2) the number of shares of Common Stock issuable upon conversion of shares of Series Preferred outstanding immediately prior to such issuance or sale, and (3) the number of shares of Common Stock issuable upon exercise, exchange or conversion of all Options and Convertible Securities (each as defined below) outstanding immediately prior to such issuance or sale.

 

(ii)                                      No adjustment in any Conversion Price shall be made in an amount less than one hundredth (1/100th) of one cent per share.  Any adjustment otherwise required by this Section 5(h) that is not required to be made to a Conversion Price due to the preceding sentence shall be included in any subsequent adjustment to such Conversion Price.  In addition, no adjustment to the Conversion Price of a series of Series Preferred shall be made if the Effective Price is greater than the Conversion Price of such series in effect immediately prior to such issuance or sale of Additional Shares of Common Stock.

 

(iii)                                  For the purpose of making any adjustment required under this Section 5(h), the aggregate consideration received by the Company for any issue or sale of securities (the “Aggregate Consideration”) is defined as:  (A) to the extent it consists of cash, it is computed at the net amount of cash received by the Company after deduction of any underwriting or similar commissions, compensation or concessions paid or allowed by the Company in connection with such issue or sale but without deduction of any expenses payable by the Company, (B) to the extent it consists of property other than cash, it is computed at the fair value of that property as determined in good faith by the Board, and (C) if Additional Shares of Common Stock, Convertible Securities or Options are issued or sold together with other stock or securities or other assets of the Company for a consideration that covers both, it is computed as the portion of the consideration so received that may be reasonably determined in good faith by the Board to be allocable to such Additional Shares of Common Stock, Convertible Securities or Options.

 

(iv)                                   For the purpose of the adjustment required under this Section 5(h), if the Company at any time or from time to time on or after the Effective Time issues or sells, or fixes a record date for the determination of holders of

 

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any class of securities entitled to receive, (A) any Preferred Stock or other stock, evidence of indebtedness, warrants, purchase rights or other securities convertible into or exchangeable for Additional Shares of Common Stock, but excluding Options (such convertible stock or securities being herein referred to as “Convertible Securities”) or (B) any rights, warrants or options to subscribe for, purchase or otherwise acquire Additional Shares of Common Stock or Convertible Securities (collectively, the “Options”), in each case the Company shall be deemed (x) to have issued, at the time of the issuance of such Options or Convertible Securities or, in case such a record date shall have been fixed, as of the close of business on such record date, the maximum number of Additional Shares of Common Stock (as set forth in the instrument relating thereto, assuming the satisfaction of any conditions to exercisability, convertibility or exchangeability but without regard to any provision contained therein for a subsequent adjustment of such number) issuable upon exercise, exchange or conversion thereof and (y) to have received as Aggregate Consideration for the issuance of such shares an amount equal to the total amount of the consideration, if any, received by the Company for the issuance of such Options or Convertible Securities plus:

 

(A)                               in the case of Options, the minimum amounts of consideration (as set forth in the instrument relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration), if any, payable to the Company upon the exercise of such Options; and

 

(B)                               in the case of Convertible Securities, the minimum amounts of consideration (as set forth in the instrument relating thereto, without regard to any provision contained therein for a subsequent adjustment of such consideration), if any, payable to the Company upon the conversion thereof (other than by cancellation of liabilities or obligations evidenced by such Convertible Securities); provided that if the minimum amounts of such consideration cannot be ascertained, but are a function of antidilution or similar protective clauses, the Company shall be deemed to have received the minimum amounts of consideration without reference to such clauses.

 

(v)                                 If the terms of any Option or Convertible Security, the issuance of which resulted in an adjustment to the Conversion Price for any series of Series Preferred pursuant to the terms of Section 5(h)(i) above, are revised as a result of an amendment to such terms or any other adjustment pursuant to the provisions of such Option or Convertible Security to provide for either (1) any increase or decrease in the number of shares of Common Stock issuable upon the exercise, exchange or conversion of any such Option or Convertible Security or (2) any increase or decrease in the consideration payable to the Company upon such exercise, exchange or conversion, then, effective upon such increase or decrease becoming effective, such Conversion Price computed upon the original issue of such Option or Convertible Security (or upon the occurrence of a record date with respect thereto) shall be readjusted to the Conversion Price as would have obtained had such revised terms been in effect upon the original date of issuance of such Option or Convertible Security.  Notwithstanding the foregoing, no readjustment pursuant to this clause (v) shall have the effect of increasing the applicable Conversion Price to an amount which exceeds the lower of (i) such applicable

 

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Conversion Price in effect immediately prior to the original adjustment made as a result of the issuance of such Option or Convertible Security, or (ii) the applicable Conversion Price that would have resulted from any issuances of Additional Shares of Common Stock (other than deemed issuances of Additional Shares of Common Stock as a result of the issuance of such Option or Convertible Security) between the original adjustment date and such readjustment date.

 

(vi)                             If the terms of any Option or Convertible Security (excluding Options or Convertible Securities which are themselves Exempted Securities (as defined below)), the issuance of which did not result in an adjustment to any applicable Conversion Price pursuant to the terms of Section 5(h)(i) (either because the consideration per share, determined pursuant to Section 5(h)(iv), of the Additional Shares of Common Stock subject thereto was equal to or greater than the applicable Conversion Price then in effect, or because such Option or Convertible Security was issued before the Effective Time), are revised after the Effective Time as a result of an amendment to such terms or any other adjustment pursuant to the provisions of such Option or Convertible Security to provide for either (1) any increase or decrease in the number of shares of Common Stock issuable upon the exercise, exchange or conversion of any such Option or Convertible Security or (2) any increase or decrease in the consideration payable to the Company upon such exercise, exchange or conversion, then such Option or Convertible Security, as so amended or adjusted, and the Additional Shares of Common Stock subject thereto (determined in the manner provided in Section 5(h)(iv)) shall be deemed to have been issued effective upon such increase or decrease becoming effective.

 

(vii)                         No further adjustment of any applicable Conversion Price, as adjusted upon the issuance of such Options or Convertible Securities, shall be made as a result of the actual issuance of Additional Shares of Common Stock or the exercise of any such Options or the exchange or conversion of any such Convertible Securities.  If any such Options or the conversion privilege represented by any such Convertible Securities shall expire without having been exercised, the applicable Conversion Price as adjusted upon the issuance of such Options or Convertible Securities shall be readjusted to a Conversion Price that would have been in effect had an adjustment been made on the basis that the only Additional Shares of Common Stock so issued were the Additional Shares of Common Stock, if any, actually issued or sold on the exercise, exchange or conversion of such Options or Convertible Securities, and such Additional Shares of Common Stock, if any, were issued or sold for the consideration actually received by the Company upon such exercise, exchange or conversion, plus the consideration, if any, actually received by the Company for the granting of all such Options, whether or not exercised, plus the consideration received for issuing or selling the Convertible Securities actually exchanged or converted, plus the consideration, if any, actually received by the Company (other than by cancellation of liabilities or obligations evidenced by such Convertible Securities) on the exchange or conversion of such Convertible Securities, provided that such readjustment shall not apply to prior conversions of Preferred Stock.

 

(viii)                     For the purpose of making any adjustment to a Conversion Price of a series of Series Preferred required under this Section 5(h),

 

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Additional Shares of Common Stock” means all shares of Common Stock issued by the Company or deemed to be issued pursuant to this Section 5(h) (including shares of Common Stock subsequently reacquired or retired by the Company), other than:

 

(A)                               shares of Common Stock, Options or Convertible Securities issued upon conversion of the Series Preferred or as a dividend or distribution on the Series Preferred;

 

(B)                               shares of Common Stock, Options or Convertible Securities issued after the Effective Time to employees, officers or directors of, or consultants or advisors to, the Company or any subsidiary of the Company pursuant to stock purchase or stock option plans or other arrangements that are approved by the Board;

 

(C)                               shares of Common Stock issued upon exercise of Options or shares of Common Stock issued upon conversion or exchange of Convertible Securities, in each case provided that such Options or Convertible Securities are outstanding as of the Effective Time and such issuance is pursuant to the terms of such Options or Convertible Securities;

 

(D)                               shares of Common Stock or Convertible Securities issued for consideration other than cash pursuant to a merger, consolidation, acquisition, or similar business combination approved by the Board (including a majority of the Preferred Directors);

 

(E)                               shares of Common Stock, Options or Convertible Securities issued pursuant to any equipment loan or leasing arrangement, real property leasing arrangement, credit agreement, debt financing from a bank or similar financial or lending institution or other commercial transactions approved by the Board (including a majority of the Preferred Directors);

 

(F)                                shares of Common Stock issued in a registered public offering of Common Stock by the Company; or

 

(G)                              shares of Common Stock, Options or Convertible Securities issued by reason of a dividend, stock split, combination or other recapitalization by the Company on shares of Common Stock as provided in Sections 5(d)(ii), (f) and (g) ((A) through (F) above collectively, the “Exempted Securities”).

 

References to the Common Stock in the subsections of this clause (viii) above mean all shares of Common Stock issued by the Company or deemed to be issued pursuant to this Section 5(h).  The “Effective Price” of Additional Shares of Common Stock means the quotient determined by dividing the total number of Additional Shares of Common Stock issued or sold, or deemed to have been issued or sold by the Company under this Section 5(h), into the Aggregate Consideration received, or deemed to have been received by the Company for such issue under this Section 5(h), for such Additional Shares of Common Stock.

 

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(ix)                             No adjustment in any Conversion Price shall be made as a result of the issuance or deemed issuance of Additional Shares of Common Stock if the Company receives written notice from the Required Holders specifically stating that no such adjustment shall be made as a result of the issuance or deemed issuance of Additional Shares of Common Stock.

 

(x)                                 If the Company issues or sells, or is deemed to have issued or sold, Additional shares of Common Stock in a Qualifying Dilutive Issuance (the “First Dilutive Issuance”), then if the Company issues or sells, or is deemed to have issued or sold, Additional Shares of Common Stock in a Qualifying Dilutive Issuance other than the First Dilutive Issuance as part of one transaction or a series of related transactions (a “Subsequent Dilutive Issuance”), then and in each such case upon a Subsequent Dilutive Issuance the Conversion Price of a series of Series Preferred shall be reduced to the Conversion Price that would have been in effect for such series had the First Dilutive Issuance and each Subsequent Dilutive Issuance all occurred on the closing date of the First Dilutive Issuance (and without giving effect to any additional adjustments as a result of any such subsequent issuances within such period).

 

(i)                                    Certificate of Adjustment.  In each case of an adjustment or readjustment of the Conversion Price of a series of Series Preferred for the number of shares of Common Stock or other securities issuable upon conversion of such series of Series Preferred, if the Series Preferred is then convertible pursuant to this Section 5, the Company, at its expense and as promptly as reasonably practicable, shall compute such adjustment or readjustment in accordance with the provisions hereof and prepare a certificate showing such adjustment or readjustment, and shall mail such certificate, by first class mail, postage prepaid, to each registered holder of shares of Series Preferred at the holder’s address as shown in the Company’s books.  The certificate shall set forth such adjustment or readjustment, showing in detail the facts upon which such adjustment or readjustment is based, including a statement of (i) the consideration received or deemed to be received by the Company for any Additional Shares of Common Stock issued or sold or deemed to have been issued or sold, (ii) the Conversion Price at the time in effect for each series of Series Preferred, (iii) the number of Additional Shares of Common Stock and (iv) the type and amount, if any, of other property that at the time would be received upon conversion of the Series Preferred.

 

(j)                                    Notices of Record Date.  Upon (i) any taking by the Company of a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend or other distribution, or (ii) any Deemed Liquidation Event or other capital reorganization of the Company, any reclassification or recapitalization of the capital stock of the Company, any merger or consolidation of the Company with or into any other corporation, or any voluntary or involuntary dissolution, liquidation or winding up of the Company, the Company shall mail to each holder of shares of Series Preferred at least ten (10) days prior to the record date specified therein (or such shorter period approved by the Required Holders) a notice specifying (A) the date on which any such record is to be taken for the purpose of such dividend or distribution and a description of such dividend or distribution, (B) the date on which any such Deemed Liquidation Event, reorganization,

 

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reclassification, transfer, consolidation, merger, dissolution, liquidation or winding up is expected to become effective, and (C) the date, if any, that is to be fixed as to when the holders of record of shares of Common Stock (or other securities) shall be entitled to exchange their shares of Common Stock (or other securities) for securities or other property deliverable upon such Deemed Liquidation Event, reorganization, reclassification, transfer, consolidation, merger, dissolution, liquidation or winding up.

 

(k)                                 Automatic Conversion.

 

(i)                                    Each share of Series Preferred shall automatically be converted into shares of Common Stock, based on the Conversion Price then in effect for such series of Series Preferred, immediately upon the closing of the Company’s initial firmly underwritten public offering pursuant to an effective registration statement under the Securities Act of 1933, as amended, covering the offer and sale of shares of Common Stock for the account of the Company (an “Initial Public Offering”) in which (A) the per share price is at least $1.527 (as adjusted for stock splits, stock dividends, stock combinations and similar events after the Effective Time), and (B) the gross cash proceeds to the Company (before underwriting discounts, commissions and fees) are at least $40,000,000 (a “Qualified IPO”).  In addition, each share of Series Preferred shall automatically be converted into shares of Common Stock, based on the Conversion Price then in effect for such series, at any time upon the affirmative vote or written consent of the Required Holders, voting together as a single class on an as-if-converted basis.  The time of the closing of such firmly underwritten public offering or the date and time specified in such vote or written consent shall be referred to herein as the “Mandatory Conversion Time.”  Upon any such automatic conversion, any declared and unpaid dividends on shares of Series Preferred and all Series C Accruing Dividends accrued and unpaid thereon, whether or not declared, shall be paid in accordance with the provisions of Section 5(d).

 

(ii)                                Upon the occurrence of either of the events specified in Section 5(k)(i) above, the outstanding shares of Series Preferred shall be converted, at the Mandatory Conversion Time, automatically without any further action by the holders of such shares and whether or not the certificates representing such shares are surrendered to the Company or its transfer agent; provided that the Company shall not be obligated to issue certificates evidencing the shares of Common Stock issuable upon such conversion unless the certificates evidencing such shares of Series Preferred are either delivered to the Company or its transfer agent as provided below, or the holder notifies the Company or its transfer agent that such certificates have been lost, stolen or destroyed and executes an agreement satisfactory to the Company to indemnify the Company from any loss incurred by it in connection with such certificates.  All holders of record of shares of Series Preferred shall be sent written notice of the Mandatory Conversion Time and the place designated for mandatory conversion of all such shares of Series Preferred pursuant to this Section 5(k). Upon receipt of such notice, the holders of shares of Series Preferred shall surrender the certificates representing such shares at the office of the Company or any transfer agent for the Series Preferred.  Thereupon, there shall be issued and delivered to such holder promptly at such office and in its name as shown on such surrendered certificate or certificates, a certificate or certificates for the

 

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number of shares of Common Stock into which the shares of Series Preferred surrendered were convertible on the date on which such automatic conversion occurred, and the Company shall pay such holder (x) in cash such amount as provided in Section 5(l) in lieu of any fraction of a share of Common Stock otherwise issuable upon such conversion and (y) all declared and unpaid dividends on such shares of Series Preferred and all Series C Accruing Dividends accrued and unpaid thereon, whether or not declared.

 

(l)                                    Fractional Shares.  No fractional shares of Common Stock shall be issued upon conversion of shares of Series Preferred.  All shares of Common Stock (including fractions thereof) issuable upon conversion of more than one share of Series Preferred by a holder thereof shall be aggregated for purposes of determining whether the conversion would result in the issuance of any fractional share.  If, after the aforementioned aggregation, the conversion would result in the issuance of any fractional share, the Company shall, in lieu of issuing any fractional share, pay cash equal to the product of such fraction multiplied by the fair market value of a share of Common Stock as determined in good faith by the Board on the date of conversion.

 

(m)                             Reservation of Stock Issuable Upon Conversion.  The Company shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock, solely for the purpose of effecting the conversion of the shares of Series Preferred, such number of its shares of Common Stock as shall from time to time be sufficient to effect the conversion of all outstanding shares of Series Preferred.  If at any time the number of authorized but unissued shares of Common Stock shall not be sufficient to effect the conversion of all then outstanding shares of Series Preferred, the Company shall take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purpose, including, without limitation, engaging in best efforts to obtain the requisite stockholder approval of any necessary amendment to this Restated Certificate.

 

(n)                                 Notices.  Any notice required by the provisions of this Section 5 shall be in writing and shall be deemed effectively given:  (i) upon personal delivery to the party to be notified, (ii) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (iii) three days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one day after deposit with a nationally recognized overnight courier, specifying next day delivery, with verification of receipt.  All notices shall be addressed to each holder of record at the address of such holder last shown on the records of the Company.

 

(o)                                 Payment of Taxes.  The Company shall pay all taxes (other than taxes based upon income) and other governmental charges that may be imposed with respect to the issue or delivery of shares of Common Stock upon conversion of shares of Series Preferred, excluding any tax or other charge imposed in connection with any transfer involved in the issue and delivery of shares of Common Stock in a name other than that in which the shares of Series Preferred so converted were registered.

 

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(p)                                 Termination of Conversion Rights.  In the event of a notice of redemption of any shares of Series C Preferred Stock or Series B-1 Preferred Stock pursuant to Section 6, the Conversion Rights of the shares designated for redemption shall terminate at the close of business on the last full day preceding the date fixed for redemption, unless the redemption price is not fully paid on such redemption date, in which case the Conversion Rights for such shares shall continue until such price is paid in full.  In the event of a Liquidation Event, the Conversion Rights shall, subject to Section 3(e), terminate at the close of business on the last full day preceding the date fixed for the payment of any such amounts distributable on such event to the holders of Preferred Stock.

 

6.                                      REDEMPTION

 

(a)                                      Redemption upon Request by Majority Series C Holders.  Shares of Series C Preferred Stock shall be redeemed by the Company out of funds legally available therefor at a per share price equal to the Series C Original Issue Price, plus any Series C Accruing Dividends accrued but unpaid thereon, whether or not declared, together with any other dividends declared but unpaid thereon (the “Series C Redemption Price”), in three (3) equal annual installments commencing sixty (60) days after receipt by the Company at any time on or after October 22, 2017, of written notice from the holders of at least a majority of then then-outstanding shares of Series C Preferred Stock, voting together as a separate class (the “Majority Series C Holders”), requesting redemption of all shares of Series C Preferred Stock (the date of each such installment being referred to as a “Series C Redemption Date”).  On each Series C Redemption Date, the Company shall redeem on a pro rata basis in accordance with the number of shares of Series C Preferred Stock owned by each holder of Series C Preferred Stock, that number of outstanding shares of Series C Preferred Stock determined by dividing (i) the total number of shares of Series C Preferred Stock outstanding immediately prior to such Series C Redemption Date by (ii) the number of remaining Series C Redemption Dates (including the Series C Redemption Date to which such calculation applies).  If the Company does not have sufficient funds legally available to redeem on any Series C Redemption Date all shares of Series C Preferred Stock to be redeemed on such Series C Redemption Date, the Company shall redeem a pro rata portion of each holder’s redeemable shares of Series C Preferred Stock out of funds legally available therefor, based on the respective amounts which would otherwise be payable in respect of the shares to be redeemed if the legally available funds were sufficient to redeem all such shares, and shall redeem the remaining shares of Series C Preferred Stock to have been redeemed as soon as practicable after the Company has funds legally available therefor.

 

(b)                                      Series C Redemption Notice.  The Company shall send written notice of the redemption pursuant to Section 6(a) (each a “Series C Redemption Notice”) to each holder of record of Series C Preferred Stock not less than forty (40) days prior to each Series C Redemption Date.  Each Series C Redemption Notice shall state:

 

(i)                                    the number of shares of Series C Preferred Stock held by the holder that the Company shall redeem on the Series C Redemption Date specified in the Redemption Notice;

 

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(ii)                                the Series C Redemption Date and the Series C Redemption Price;

 

(iii)                            the date on which the holder’s right to convert such shares terminates (as determined in accordance with Section 5); and

 

(iv)                             that the holder is to surrender to the Company, at the office of the Company or its transfer agent, his, her or its certificate or certificates representing the shares of Series C Preferred Stock to be redeemed.

 

(c)                                       Redemption upon Event of Default.  If an Event of Default (as defined in the Exchange Agreement) occurs prior to the Termination Date (as defined in the Exchange Agreement), the Company shall redeem (i) all shares of Series B-1 Preferred Stock owned by the Office of Governor Economic Development and Tourism (the “OOGEDT”) as of the Series B-1 Redemption Date (as defined below) at a price per share equal to the greater of (x) three (3) times the Series B-1 Base Liquidation Amount plus any dividends declared but unpaid thereon, (y) three (3) times the Series B-1 Original Issue Price and (z) three (3) times the Fair Market Value (as defined below) of a share of Series B-1 Preferred Stock (the “Series B-1 Redemption Price” and together with the Series C Redemption Price, the “Redemption Price”), and (ii) all shares of Series C Preferred Stock at a price per share equal to the Series C Redemption Price upon written request from the Majority Series C Holders (the “Series C Participation Request”), with a copy thereof to each other holder of Series C Preferred Stock, within ten (10) days after receipt of the Series B-1 Redemption Notice (as defined below) from the Company, in a single payment occurring not more than thirty (30) days after receipt by the Company from the OOGEDT of written notice requesting redemption of all shares of Series B-1 Preferred Stock (the “Series B-1 Redemption Request”).  Upon receipt of a Series B-1 Redemption Request from the OOGEDT and, if applicable, a Series C Participation Request from the Majority Series C Holders, the Company shall apply all of its assets to any such redemption, and to no other corporate purpose, except to the extent prohibited by Delaware law governing distributions to stockholders.  The date of such payment shall be referred to as the “Series B-1 Redemption Date.”  The Series C Redemption Date and the Series B-1 Redemption Date are referred to together as the “Redemption Date.”  If on the Series B-1 Redemption Date Delaware law governing distributions to stockholders prevents the Company from redeeming all shares of Series B-1 Preferred Stock and Series C Preferred Stock to be redeemed, the Company shall ratably redeem the maximum number of shares that it may redeem consistent with such law based on the respective amounts which would otherwise be payable in respect of the shares to be redeemed if the Company were allowed to redeem all such shares, and shall redeem the remaining shares as soon as it may lawfully do so under such law.  For purposes of this Section 6(c) only, the “Fair Market Valueof a share of Series B-1 Preferred Stock shall be the per share price of the last Company’s offer and sale of preferred stock to a third party in a bona fide transaction before the date of the Series B-1 Redemption Request.  The rights of the OOGEDT to redeem shares of Series B-1 Preferred Stock pursuant to this Section 6(c) are personal to the OOGEDT, may not be assigned by the OOGEDT and shall terminate with respect a share of Series B-1 Preferred Stock upon any sale, exchange, transfer, gift, encumbrance, assignment, pledge,

 

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mortgage, hypothecation or other disposition by the OOGEDT of such share of Series B-1 Preferred Stock.

 

(d)                                      Series B-1 Redemption Notice.  The Company shall send written notice of the Series B-1 Redemption Request (each a “Series B-1 Redemption Notice”) to each holder of record of Series C Preferred Stock within five (5) days after receipt of the Series B-1 Redemption Request from the OOGEDT.  Each Series B-1 Redemption Notice shall state:

 

(i)                                    the number of shares of Series B-1 Preferred Stock held by the OOGEDT and the Series B-1 Redemption Date;

 

(ii)                                the number of shares of Series C Preferred Stock held by the holder that the Company shall redeem on the Series B-1 Redemption Date if the Majority Series C Holders so elect and the Series C Redemption Price;

 

(iii)                            the date on which the holder’s right to convert such shares terminates (as determined in accordance with Section 5); and

 

(iv)                             that the holder is to surrender to the Company, at the office of the Company or its transfer agent, his, her or its certificate or certificates representing the shares of Series C Preferred Stock to be redeemed.

 

(e)          Surrender of Certificates; Payment.  On or before the applicable Redemption Date, each holder of shares of Series C Preferred Stock or Series B-1 Preferred Stock, as the case may be, to be redeemed on such Redemption Date, unless such holder has exercised his, her or its right to convert such shares as provided in Section 5(a), shall surrender the certificate or certificates representing such shares (or, if such registered holder alleges that such certificate has been lost, stolen or destroyed, an agreement reasonably acceptable to the Company to indemnify the Company against any claim that may be made against the Company on account of the alleged loss, theft or destruction of such certificate) to the Company at the office of the Company or its transfer agent, and thereupon the Redemption Price for such shares shall be payable to the order of the person whose name appears on such certificate or certificates as the owner thereof.  In the event less than all of the shares of Series C Preferred Stock or Series B-1 Preferred Stock, as applicable, represented by a certificate are redeemed, a new certificate representing the unredeemed shares of Series C Preferred Stock or Series B-1 Preferred Stock shall promptly be issued to such holder.  For the avoidance of doubt, in no event shall a holder of Series C Preferred Stock or Series B-1 Preferred Stock be entitled to receive both their respective Redemption Price pursuant to this Section 6 and their respective Liquidation Preferences pursuant to Section 3, and the right to receive their respective Redemption Price pursuant to this Section 6 shall terminate upon any payment of their respective Liquidation Preferences pursuant to Section 3.

 

(f)                                   Rights Subsequent to Redemption.  If on the applicable Redemption Date the Redemption Price payable upon redemption of the shares of Series C Preferred Stock or Series B-1 Preferred Stock, as the case may be, to be redeemed on

 

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such Redemption Date is paid or tendered for payment or deposited with an independent payment agent so as to be available therefor in a timely manner, then notwithstanding that the certificates evidencing any of the shares of Series C Preferred Stock or Series B-1 Preferred Stock, as applicable, so called for redemption shall not have been surrendered, dividends with respect to such shares of Series C Preferred Stock or Series B-1 Preferred Stock shall cease to accrue after such Redemption Date and all rights with respect to such shares shall forthwith after the Redemption Date terminate, except only the right of the holders to receive the Redemption Price without interest upon surrender of their certificate or certificates therefor.  In the event that shares of Series C Preferred Stock or Series B-1 Preferred Stock, as applicable, are not redeemed on a Redemption Date, such shares shall remain outstanding and shall be entitled to all of the rights, preferences and privileges provided herein until redeemed.

 

7.                                      NO REISSUANCE OF THE SERIES PREFERRED.

 

No share or shares of Series Preferred acquired by the Company by reason of purchase, redemption, conversion or otherwise shall be reissued, and all such shares shall be retired and cancelled.

 

8.                                      WAIVER.

 

Except as otherwise set forth in this Restated Certificate, any of the rights, powers, preferences and other terms of the Preferred Stock set forth herein may be waived on behalf of all holders of Preferred Stock by the affirmative written consent or vote of the Required Holders.

 

9.                                      NOTICES.

 

Except as explicitly provided herein, any notice required or permitted by the provisions of this Article Four to be given to a holder of shares of Series Preferred shall be mailed, postage prepaid, to the address last shown on the records of the Company, or given by electronic communication in compliance with the DGCL, and shall be deemed sent upon such mailing or electronic transmission.

 

ARTICLE FIVE

 

The business and affairs of the Company shall be managed by and under the direction of the Board.

 

ARTICLE SIX

 

Except as otherwise provided in this Restated Certificate, in furtherance and not in limitation of the powers conferred by statute, the Board is expressly authorized to adopt, amend or repeal in any respect any or all of the Bylaws.

 

ARTICLE SEVEN

 

Elections of directors need not be by written ballot unless the Bylaws shall so provide.

 

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ARTICLE EIGHT

 

Meetings of stockholders of the Company may be held within or without the State of Delaware, as the Bylaws may provide.  The books of the Company may be kept (subject to any provision of applicable law) outside the State of Delaware at such place or places as may be designated from time to time by the Board or in the Bylaws.

 

ARTICLE NINE

 

A director of the Company shall not be personally liable to the Company or its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (a) for any breach of the director’s duty of loyalty to the Company or its stockholders, (b) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (c) under Section 174 of the DGCL, or (d) for any transaction from which the director derived an improper personal benefit.  If the DGCL is amended to authorize the further elimination or limitation of the liability of directors, then the liability of a director of the Company, in addition to the limitation on personal liability provided in this Restated Certificate, shall be eliminated or limited to the fullest extent permitted by the DGCL as so amended.  No amendment to or repeal of this Article Nine shall apply to or have any effect on the liability or alleged liability of any director of the Company for or with respect to any acts or omissions of such director occurring prior to such amendment or repeal.

 

ARTICLE TEN

 

To the fullest extent permitted by applicable law, the Company is also authorized to provide indemnification of (and advancement of expenses to) its directors, officers and agents (and any other persons to which Delaware law permits the Company to provide indemnification) through Bylaw provisions, agreements with such directors, officers, agents or other persons, vote of stockholders or disinterested directors, or otherwise, in excess of the indemnification and advancement otherwise permitted by Section 145 of the DGCL, subject only to limits created by applicable Delaware law (statutory or non-statutory), with respect to actions for breach of duty to the Company, its stockholders, and others.  Any amendment, repeal or modification of any of the foregoing provisions of this Article Ten shall not adversely affect any right or protection of any director, officer, agent, or other person existing at the time of, or increase the liability of any director, officer or agent of the Company or other person with respect to any acts or omissions of such director, officer, agent or other person occurring prior to, such repeal or modification.

 

ARTICLE ELEVEN

 

Subject to the provisions of this Restated Certificate, the Company reserves the right to amend, alter, change, or repeal any provision contained in this Restated Certificate, in the manner now or hereafter prescribed by applicable laws, and all rights conferred upon stockholders in this Restated Certificate are granted subject to this reservation.

 

ARTICLE TWELVE

 

The Company renounces, to the fullest extent permitted by law, any interest or expectancy of the Company in, or in being offered an opportunity to participate in, any Excluded

 

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Opportunity.  An “Excluded Opportunity” is any matter, transaction or interest that is presented to, or acquired, created or developed by, or which otherwise comes into the possession of, (i) any director of the Company who is not an employee of the Company or any of its subsidiaries, or (ii) any holder of Preferred Stock or any partner, member, director, stockholder, employee or agent of any such holder, other than someone who is an employee of the Company or any of its subsidiaries (collectively, “Covered Persons”), unless such matter, transaction or interest is presented to, or acquired, created or developed by, or otherwise comes into the possession of, a Covered Person expressly and solely in such Covered Person’s capacity as a director of the Company or arising directly from such Covered Person’s interest in the Company.

 

ARTICLE THIRTEEN

 

Unless the Company consents in writing to the selection of an alternative forum, the Court of Chancery of the State of Delaware shall be the sole and exclusive forum for (a) any derivative action or proceeding brought on behalf of the Company, (b) any action asserting a claim of breach of a fiduciary duty owed by any director or officer of the Company to the Company or the Company’s stockholders, (c) any action asserting a claim against the Company arising pursuant to any provision of the DGCL, this Restated Certificate or the Bylaws or (d) any action asserting a claim against the Company governed by the internal affairs doctrine, as applied by the courts of the state of Delaware to corporations organized and existing under the DGCL.

 

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The undersigned, being the duly elected Chief Executive Officer of the Company, for the purpose of amending and restating the Original Certificate, does make this Restated Certificate, hereby declaring and certifying that this is the act and deed of the Company and the facts stated in this Restated Certificate are true, and accordingly has hereunto executed this Restated Certificate as a duly authorized officer of the Company this 21st day of March, 2014.

 

 

 

MIRNA THERAPEUTICS, INC.

 

 

 

 

 

/S/ PAUL LAMMERS

 

Paul Lammers, M.D., M.Sc.

 




Exhibit 3.4

 

MIRNA THERAPEUTICS, INC.
(a Delaware corporation)

 

BYLAWS

 

ARTICLE 1

 

OFFICES

 

Section 1.1.                                 Registered Office.  The registered office shall be in the City of Wilmington, County of New Castle, State of Delaware.

 

Section 1.2.                                 Other Offices.  The Corporation may also have offices at such other places, either within or without the State of Delaware, as the board of directors may from time to time to determine or as the business of the Corporation may require.

 

ARTICLE 2

 

MEETINGS OF STOCKHOLDERS

 

Section 2.1.                                 Place of Meetings.  All meetings of the stockholders shall be held at the office of the Corporation or at such other places as may be fixed from time to time by the board of directors, either within or without the State of Delaware, and stated in the notice of the meeting or in a duly executed waiver of notice of the meeting, or the board of directors, may in its sole discretion, determine that the meeting shall not be held at any place, but may instead be held solely by means of remote communication.

 

Section 2.2.                                 Annual Meetings.  Annual meetings of stockholders, commencing with the year 2008, shall be held at the time and place, if any, to be selected by the board of directors.  If the day is a legal holiday, then the meeting shall be held on the next following business day.  At the meeting, the stockholders shall elect a board of directors and transact such other business as may properly be brought before the meeting.  Each election of directors shall be by written ballot, unless otherwise provided in the Certificate of Incorporation.  If authorized by the board of directors, such requirement of a written ballot shall be satisfied by a ballot submitted by electronic transmission, provided, that any such electronic transmission must either set forth or be submitted with information from which it can be determined that the electronic transmission was authorized by the stockholder or proxyholder.

 

Section 2.3.                                 Notice of Annual Meeting.  Notice of the annual meeting stating the place, if any, date, and hour of the meeting shall be given in accordance with Section 2.4 of this Article to each stockholder entitled to vote at such meeting not less than 10 nor more than 60 days before the date of the meeting.

 

Section 2.4.                                 Manner of Giving Notice; Affidavit of Notice.  If mailed, notice to stockholders shall be deemed given when deposited in the United States mail, postage prepaid, directed to the stockholder at his address as it appears on the records of the Corporation.  Without limiting the manner by which notice may otherwise be given effectively to stockholders, any notice to stockholders may be given by electronic transmission in the manner provided in

 



 

Section 232 of the Delaware General Corporation Law.  An affidavit of the secretary or an assistant secretary or of the transfer agent of the Corporation that the notice has been given shall, in the absence of fraud, be prima facie evidence of the facts stated in such affidavit.

 

Section 2.5.                                 Voting List.  The officer who has charge of the stock ledger of the Corporation shall prepare and make, at least 10 days before every meeting of stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder.  Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during the whole time of the meeting as in the manner provided by law.

 

Section 2.6.                                 Special Meetings.  Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the Certificate of Incorporation, may be called by the chairperson of the board, the chief executive officer or the president and shall be called by the chief executive officer, the president or secretary at the request in writing of a majority of the board of directors, or by the holders of ten percent or more of the outstanding shares of stock of the Corporation.  Such request shall state the purpose or purposes of the proposed meeting.

 

Section 2.7.                                 Notice of Special Meetings.  Notice of a special meeting stating the place, if any, date, and hour of the meeting and the purpose or purposes for which the meeting is called, shall be given in accordance with Section 2.4 of this Article 2 not less than ten nor more than sixty days before the date of the meeting, to each stockholder entitled to vote at such meeting.  Business transacted at any special meeting of the stockholders shall be limited to the purposes stated in the notice.

 

Section 2.8.                                 Quorum.  The holders of a majority of the stock issued and outstanding and entitled to vote at meetings of the stockholders, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business, except as otherwise provided by statute or by the Certificate of Incorporation.  If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote at such meeting, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present or represented.  At such adjourned meeting at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified.  If the adjournment is for more than 30 days, or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each stockholder of record entitled to vote at the meeting.

 

Section 2.9.                                 Order of Business.  At each meeting of the stockholders, one of the following persons, in the order in which they are listed (and in the absence of the first, the next, and so on), shall serve as chairperson of the meeting:  chairperson of the board, chief executive officer, president, vice presidents (in the order of their seniority if more than one), and secretary.  The order of business at each such meeting shall be as determined by the chairperson of the meeting.  The chairperson of the meeting shall have the right and authority to prescribe such rules, regulations, and procedures and to do all such acts and things as are necessary or desirable for the proper conduct of the meeting, including, without limitation, the establishment of

 

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procedures for the maintenance of order and safety, limitations on the time allotted to questions or comments on the affairs of the Corporation, restrictions on entry to such meeting after the time prescribed for the commencement thereof, and the opening and closing of the voting polls.

 

Section 2.10.                          Vote Required.  Unless otherwise required by law or provided in the certificate of incorporation or these Bylaws, in all matters to come before the stockholders at any meeting other than the election of directors, the affirmative vote of the majority of shares present in person or represented by proxy at the meeting and entitled to vote on the subject matter shall be the act of the stockholders.  Directors shall be elected by a plurality of the votes of the shares present in person or represented by proxy at the meeting and entitled to vote on the election of directors.

 

Section 2.11.                          Method of Voting.  Unless otherwise provided in the Certificate of Incorporation, each stockholder shall at every meeting of the stockholders be entitled to one vote in person or by proxy for each share of the capital stock having voting power held by such stockholder, but no proxy shall be voted on after three years from its date, unless the proxy provides for a longer period.

 

Section 2.12.                          Action by Stockholders Without Meeting.  Unless otherwise restricted by the Certificate of Incorporation or these bylaws, any action required or permitted to be taken at any annual or special meeting of the stockholders may be taken without a meeting, without notice and without a prior vote, if a consent or consents in writing or in accordance with Section 228 of the Delaware General Corporation Law, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation by delivery to its registered office in Delaware, its principal place of business or an officer or agent of the Corporation or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded.  Delivery made to a Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.

 

Section 2.13.                          Presence at Meetings.  If authorized by the board of directors in its sole discretion, and subject to such guidelines and procedures as the board of directors may adopt, stockholders and proxyholders not physically present at the meeting of stockholders may by means of remote communication (a) participate in a meeting of stockholders and (b) be deemed present in person and vote at a meeting of stockholders whether such meeting is to be held at a designated place or solely by means of remote communication, provided, that (i) the Corporation shall implement reasonable measures to verify that each person deemed present and permitted to vote at the meeting by means of remote communication is a stockholder or proxyholder, (ii) the Corporation shall implement reasonable measures to provide such stockholders and proxyholders a reasonable opportunity to participate in the meeting and to vote on matters submitted to the stockholders, including an opportunity to read or hear the proceedings of the meeting substantially concurrently with such proceedings, and (iii) if any stockholder or proxyholder votes or takes other action at the meeting by means of remote communication, a record of such vote or other action shall be maintained by the Corporation.

 

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ARTICLE 3

 

DIRECTORS

 

Section 3.1.                                 General Powers.  The business and affairs of the Corporation shall be managed by or under the direction of the board of directors, which may exercise all such powers of the Corporation and do all such lawful acts and things as are not by law or by the Certificate of Incorporation of the Corporation or by these Bylaws directed or required to be exercised or done by the stockholders.

 

Section 3.2.                                 Approval of Indebtedness.  The Corporation shall not create, incur or assume any indebtedness for borrowed money or capitalized lease obligations, except for trade debt incurred in the ordinary course of business, without the approval of the board of directors.

 

Section 3.3.                                 Number of Directors.  The number of directors constituting the board shall be such number as shall be from time to time specified by resolution of the board of directors; provided, that no director’s term shall be shortened by reason of a resolution reducing the number of directors.

 

Section 3.4.                                 Election, Qualification, and Term of Office of Directors.  Directors shall be elected at each annual meeting of stockholders to hold office until the next annual meeting.  Directors need not be stockholders unless so required by the Certificate of Incorporation or these Bylaws, which may prescribe other qualifications for directors.  Each director, including a director elected to fill a vacancy, shall hold office until his successor is elected and qualified or until his earlier resignation or removal.

 

Section 3.5.                                 Notification of Nominations.  Subject to the rights of the holders of any class or series of stock having a preference over the common stock as to dividends or upon liquidation, nominations for the election of directors may be made by the board of directors or by any stockholder entitled to vote for the election of directors.

 

Section 3.6.                                 Regular Meetings.  Regular meetings of the board of directors may be held without notice at such times and at such places as shall from time to time be determined by the board.

 

Section 3.7.                                 Special Meetings.  Special meetings of the board may be called by the chairperson of the board, the chief executive officer or the president, and shall be called by the chief executive officer, the president or the secretary on the written request of two directors unless the board of directors consists of only one director, in which case special meetings shall be called by the chief executive officer, the president or the secretary on the written request of the sole director.

 

Section 3.8.                                 Quorum, Majority Vote.  At all meetings of the board, a majority of the entire board of directors shall constitute a quorum for the transaction of business and the act of a majority of the directors present at any meeting at which there is a quorum shall be the act of the board of directors, except as may be otherwise specifically provided by statute or by the Certificate of Incorporation.  If a quorum shall not be present at any meeting of the board of

 

4



 

directors, the directors present at such meeting may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.

 

Section 3.9.                                 Action Without Meeting.  Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, any action required or permitted to be taken at any meeting of the board of directors or of any committee of the board of directors may be taken without a meeting, if all members of the board or committee, as the case may be, consent to such action in writing, or by electronic transmission and the writing or writings or electronic transmission or transmissions are filed with the minutes of the proceedings of the board or committee.  Such filing shall be in paper form if the minutes are maintained in paper form and shall be in electronic form if the minutes are maintained in electronic form.  Such consent shall have the same force and effect as a unanimous vote at a meeting, and may be stated as such in any document or instrument filed with the Secretary of State of Delaware.

 

Section 3.10.                          Telephone and Other Meetings.  Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, members of the board of directors, or any committee designated by the board of directors, may participate in a meeting of the board of directors, or any committee, by means of conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and such participation in a meeting shall constitute presence in person at the meeting.

 

Section 3.11.                          Notice of Meetings.  Notice of regular meetings of the board of directors or of any adjourned meeting of the board of directors need not be given.  Notice of each special meeting of the board shall be mailed to each director, addressed to such director at such director’s residence or usual place of business, at least two days before the day on which the meeting is to be held or shall be sent to such director at such place by telegraph or be given personally or by telephone, not later than the day before the meeting is to be held, but notice need not be given to any director who shall, either before or after the meeting, submit a signed waiver of such notice or who shall attend such meeting without protesting, prior to or at its commencement, the lack of notice to such director.  Every such notice shall state the time and place but need not state the purpose of the meeting.

 

Section 3.12.                          Rules and Regulations.  The board of directors may adopt such rules and regulations not inconsistent with the provisions of law, the Certificate of Incorporation of the Corporation, or these Bylaws for the conduct of its meetings and management of the affairs of the Corporation as the board may deem proper.

 

Section 3.13.                          Resignations.  Any director of the Corporation may at any time resign by giving notice in writing or by electronic transmission to the board of directors, the chairperson of the board, the chief executive officer, the president, or the secretary of the Corporation.  Such resignation shall take effect at the time specified in such notice or, if the time be not specified, upon receipt of such notice; and, unless otherwise specified in such notice, the acceptance of such resignation shall not be necessary to make it effective.

 

Section 3.14.                          Removal of Directors.  Unless otherwise restricted by statute, by the Certificate of Incorporation, or by these Bylaws, any director or the entire board of directors may

 

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be removed, with or without cause, by the holders of a majority of the shares then entitled to vote at an election of directors.

 

Section 3.15.                          Vacancies.  Subject to the rights of the holders of any class or series of stock having a preference over the common stock of the Corporation as to dividends or upon liquidation, any vacancies on the board of directors resulting from death, resignation, removal, or other cause shall only be filled by the affirmative vote of a majority of the remaining directors then in office, even though less than a quorum of the board of directors, or by a sole remaining director, and newly created directorships resulting from any increase in the number of directors shall be filled by the board of directors, or if not so filled, by the stockholders at the next annual meeting of the stockholders or at a special meeting called for that purpose in accordance with Section 2.6 of Article 2 of these Bylaws.  Any director elected in accordance with the preceding sentence of this Section shall hold office for the remainder of the full term of the class of directors in which the new directorship was created or the vacancy occurred and until such successor shall have been elected and qualified.

 

Section 3.16.                          Compensation of Directors.  Unless otherwise restricted by the Certificate of Incorporation or these Bylaws, the board of directors shall have the authority to fix the compensation of directors.  The directors may be paid their expenses, if any, of attendance at each meeting of the board of directors and may be paid a fixed sum for attendance at each meeting of the board of directors or a stated salary as director.  No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation for such service.  Members of special or standing committees may be allowed like compensation for attending committee meetings.

 

ARTICLE 4

 

EXECUTIVE AND OTHER COMMITTEES

 

Section 4.1.                                 Executive Committee.  The board of directors may, by resolution adopted by a majority of the entire board, designate annually one or more of its members to constitute members or alternate members of an executive committee, which committee shall have and may exercise, between meetings of the board, all the powers and authority of the board in the management of the business and affairs of the Corporation, including, if such committee is so empowered and authorized by resolution adopted by a majority of the entire board, the power and authority to declare a dividend and to authorize the issuance of stock, and may authorize the seal of the Corporation to be affixed to all papers which may require it, except that the executive committee shall not have such power or authority with reference to:

 

(a)                                 amending the Certificate of Incorporation of the Corporation;

 

(b)                                 adopting an agreement of merger or consolidation involving the Corporation;

 

(c)                                  recommending to the stockholders the sale, lease or exchange of all or substantially all of the property and assets of the Corporation;

 

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(d)                                 recommending to the stockholders a dissolution of the Corporation or a revocation of a dissolution;

 

(e)                                  adopting, amending, or repealing any Bylaw;

 

(f)                                   filling vacancies on the board or on any committee of the board, including the executive committee;

 

(g)                                  fixing the compensation of directors for serving on the board or on any committee of the board, including the executive committee; or

 

(h)                                 amending or repealing any resolution of the board which by its terms may be amended or repealed only by the board.

 

Section 4.2.                                 Other Committees.  The board of directors may, by resolution adopted by a majority of the entire board, designate from among its members one or more other committees, each of which shall, except as otherwise prescribed by law, have such authority of the board as may be specified in the resolution of the board designating such committee.  A majority of all the members of such committee may determine its action and fix the time and place of its meetings, unless the board shall otherwise provide.  The board shall have the power at any time to change the membership of, to increase or decrease the membership of, to fill all vacancies in, and to discharge any such committee, or any member of any such committee, either with or without cause.

 

Section 4.3.                                 Procedure; Meetings; Quorum.  Regular meetings of the executive committee or any other committee of the board of directors, of which no notice shall be necessary, may be held at such times and places as shall be fixed by resolution adopted by a majority of the members of such committee.  Special meetings of the executive committee or any other committee of the board shall be called at the request of any member of such committee.  Notice of each special meeting of the executive committee or any other committee of the board shall be sent by mail, telegraph, or telephone, or be delivered personally to each member of such committee not later than the day before the day on which the meeting is to be held, but notice need not be given to any member who shall, either before or after the meeting, submit a signed waiver of such notice or who shall attend such meeting without protesting, prior to or at its commencement, the lack of such notice to such member.  Any special meeting of the executive committee or any other committee of the board shall be a legal meeting without any notice of such meeting having been given, if all the members of such committee shall be present at such meeting.  Notice of any adjourned meeting of any committee of the board need not be given.  The executive committee or any other committee of the board may adopt such rules and regulations not inconsistent with the provisions of law, the Certificate of Incorporation of the Corporation, or these Bylaws for the conduct of its meetings as the executive committee or any other committee of the board may deem proper.  A majority of the executive committee or any other committee of the board shall constitute a quorum for the transaction of business at any meeting, and the vote of a majority of the members of such committee present at any meeting at which a quorum is present shall be the act of such committee.  In the absence or disqualification of a member, the remaining members, whether or not a quorum, may fill a vacancy.  The executive committee or any other committee of the board of directors shall keep written minutes

 

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of its proceedings, a copy of which is to be filed with the secretary of the Corporation, and shall report on such proceedings to the board.

 

ARTICLE 5

 

NOTICES

 

Section 5.1.                                 Method.  Whenever, under the provisions of the statutes or of the Certificate of Incorporation or of these Bylaws, notice is required to be given to any director or stockholder, it shall not be construed to mean personal notice, but such notice may be given in writing, by mail, electronic mail, overnight delivery, facsimile or any other manner provided in Section 232 of the Delaware General Corporation Law, addressed to such director or stockholder, at his mailing address, electronic mail address, or facsimile number as it appears on the records of the Corporation, with postage on such notice prepaid (as applicable), and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail if sent by mail or when received if sent by electronic mail, overnight delivery, or facsimile.  Notice to directors may also be given by telegram.

 

Section 5.2.                                 Waiver.  Whenever any notice is required to be given under the provisions of the statutes or of the Certificate of Incorporation or of these Bylaws, a written waiver of such notice, signed by the person or persons entitled to said notice or waiver by electronic transmission by such person, whether before or after the time stated in such waiver, shall be deemed equivalent to notice.

 

ARTICLE 6

 

OFFICERS

 

Section 6.1.                                 Election, Qualification.  The officers of the Corporation shall be chosen by the board of directors and shall be a president and a secretary.  The board of directors may also choose a chairperson of the board, a chief executive officer, a chief operating officer, a chief financial officer, one or more vice presidents, a treasurer, one or more assistant secretaries and assistant treasurers and such other officers and agents as it shall deem necessary.  Any number of offices may be held by the same person, unless the Certificate of Incorporation or these Bylaws otherwise provide.

 

Section 6.2.                                 Salary.  The salaries of all officers and agents of the Corporation shall be fixed by the board of directors.

 

Section 6.3.                                 Term, Removal.  Each officer shall hold office until such officer’s successor is elected and qualified or until such officer’s earlier resignation or removal.  Any officer elected or appointed by the board of directors may be removed at any time by the affirmative vote of a majority of the board of directors.  Any vacancy occurring in any office of the Corporation shall be filled by the board of directors.

 

Section 6.4.                                 Resignation.  Subject at all times to the right of removal as provided in Section 6.3 of this Article 6 and to the provisions of any employment agreement, any officer may

 

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resign at any time by giving notice to the board of directors, the chief executive officer, the president, or the secretary of the Corporation.  Any such resignation shall take effect at the date of receipt of such notice or at any later date specified provided that the chief executive officer or president or, in the event of the resignation of the chief executive officer or the president, the board of directors may designate an effective date for such resignation which is earlier than the date specified in such notice but which is not earlier than the date of receipt of such notice; and, unless otherwise specified in such notice, the acceptance of such resignation shall not be necessary to make it effective.

 

Section 6.5.                                 Vacancies.  A vacancy in any office because of death, resignation, removal, or any other cause may be filled for the unexpired portion of the term in the manner prescribed in these Bylaws for election to such office.

 

Section 6.6.                                 Chairperson of the Board.  The chairperson of the board, if there be such an officer, shall preside at all meetings of the stockholders and the board of directors and shall perform all duties incident to the office of chairperson of the board and as from time to time may be assigned to him or her by the board of directors.  Except as otherwise provided by resolution of the board of directors, the chairperson of the board shall be ex-officio a member of all committees of the board of directors.

 

Section 6.7.                                 Chief Executive Officer.  The chief executive officer, if there be such an officer, shall, subject to the provisions of these Bylaws and to the direction and supervision of the board of directors, (a) have general and active management of the affairs of the Corporation and have general supervision of its officers, agents and employees; (b) in the absence of the chairperson of the board, preside at all meetings of the stockholders and the board of directors; (c) have primary responsibility for the implementation of the policies adopted from time to time by the board of directors; and (d) perform those other duties incident to the office of chief executive officer and as from time to time may be assigned to him or her by the board of directors.

 

Section 6.8.                                 President.  The president shall, subject to the provisions of these bylaws and to the direction and supervision of the board of directors, perform all duties incident to the office of president and as from time to time may be assigned to him or her by the board of directors.  At the request of the chief executive officer or in the absence of the chief executive officer and the chairperson of the board, in the event of their inability or refusal to act, the president shall perform the duties of the chief executive officer, and when so acting shall have all the powers and be subject to all restrictions of the chief executive officer.

 

Section 6.9.                                 Chief Operating Officer.  The chief operating officer, if there be such an officer, shall, subject to the provisions of these Bylaws and to the direction and supervision of the board of directors and the chief executive officer, supervise the day to day operations of the Corporation and perform those other duties incident to the office of chief operating officer and as from time to time may be assigned to him or her by the board of directors or the chief executive officer.

 

Section 6.10.                          Chief Financial Officer.  The chief financial officer, if there be such an officer, shall, subject to the provisions of these Bylaws and to the direction and supervision of

 

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the board of directors and the chief executive officer, manage the financial affairs of the Corporation and perform those other duties incident to the office of chief financial officer and as from time to time may be assigned to him or her by the board of directors or the chief executive officer.  If there is no chief financial officer, these duties shall be performed by the treasurer or such other person designated by the board of directors to perform such duties.

 

Section 6.11.                          Vice Presidents.  Each vice president, including each executive vice president and each senior vice president, if there be such an officer (or if there is more than one, then each vice president), shall perform such duties as from time to time may be assigned to him or her by the board of directors, the chief executive officer or the president.  In the absence of the chief executive officer, the president and the chairman of the board or, in the event of their inability or refusal to act, the vice president, if there be such an officer (or in the event there be more than one vice president, the vice presidents in the order designated by the directors, or, in the absence of any designation, then in the order of their election), shall perform the duties of the president and, when so acting, shall have all the powers of and be subject to all the restrictions upon the president.  The vice presidents shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.

 

Section 6.12.                          Secretary.  The secretary shall attend all meetings of the board of directors and all meetings of the stockholders and record all the proceedings of the meetings of the Corporation and of the board of directors in a book to be kept for that purpose and shall perform like duties for the standing committees when required.  He shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the board of directors, and shall perform such other duties as may be prescribed by the board of directors or president, under whose supervision he shall be.  He shall have custody of the corporate seal of the Corporation and he, or an assistant secretary, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by his signature or by the signature of such assistant secretary.  The board of directors may give general authority to any other officer to affix the seal of the Corporation and to attest the affixing by his signature.

 

Section 6.13.                          Assistant Secretary.  The assistant secretary, or if there be more than one, the assistant secretaries in the order determined by the board of directors (or if there be no such determination, then in the order of their election) shall, in the absence of the secretary or in the event of his inability or refusal to act, perform the duties and exercise the powers of the secretary and shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.

 

Section 6.14.                          Treasurer.  The treasurer, if there be such an officer, shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the board of directors.  He shall disburse the funds of the Corporation as may be ordered by the board of directors, taking proper vouchers for such disbursements, and shall render to the president and the board of directors, at its regular meetings, or when the board of directors so requires, an account of all his transactions as treasurer and of the financial condition of the Corporation.  If required by the board of directors, he shall give the Corporation a bond in such sum and with such surety or sureties as shall be satisfactory to the board of directors for the

 

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faithful performance of the duties of his office and for the restoration to the Corporation, in case of his death, resignation, retirement, or removal from office, of all books, papers, vouchers, money, and other property of whatever kind in his possession or under his control belonging to the Corporation.  If there is not a treasurer of the Corporation, then the duties set forth above shall be discharged by the President or such other officer as shall be designated by the board of directors.

 

Section 6.15.                          Assistant Treasurer.  The assistant treasurer, or if there shall be more than one, the assistant treasurers in the order determined by the board of directors (or if there be no such determination, then in the order of their election), shall, in the absence of the treasurer or in the event of his inability or refusal to act, perform the duties and exercise the powers of the treasurer and shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.

 

ARTICLE 7

 

INDEMNIFICATION OF DIRECTORS,
OFFICERS, EMPLOYEES, AND AGENTS

 

Section 7.1.                                 Third-Party Actions.  The Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative (other than an action by or in the right of the Corporation) by reason of the fact that such person is or was a director or officer of the Corporation, or is or was serving at the request of the Corporation as a director or officer of another corporation, partnership, joint venture, trust, or other enterprise, against all expenses (including attorney’s fees), judgments, fines, and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit, or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful.  The termination of any action, suit, or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, that such person had reasonable cause to believe that his or her conduct was unlawful.

 

The Corporation may indemnify any employee or agent of the Corporation, or any employee or agent serving at the request of the Corporation as an employee or agent of another corporation, partnership, joint venture, trust, or other enterprise, in the manner and to the extent that it shall indemnify any director or officer under this Section.

 

Section 7.2.                                 Derivative Actions.  The Corporation may indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending, or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that such person is or was a director, officer, employee, or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer, employee, or agent of another

 

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corporation, partnership, joint venture, trust, or other enterprise, against all expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, except that no indemnification shall be made with respect to any claim, issue or matter as to which such person shall have been adjudged to be liable for negligence or misconduct in the performance of such person’s duty to the Corporation unless and only to the extent that the Court of Chancery of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery of Delaware or such other court shall deem proper.

 

Section 7.3.                                 Determination of Indemnification.  Any indemnification under Section 7.1 or Section 7.2 of this Article (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the director, officer, employee, or agent is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 7.1 or Section 7.2 of this Article.  Such determination shall be made (a) by the board of directors by a majority vote of a quorum consisting of directors who were not parties to such action, suit, or proceeding, or (b) if such a quorum is not obtainable, or, even if obtainable, a quorum of disinterested directors so directs, by independent legal counsel in a written opinion, or (c) by the stockholders.

 

Section 7.4.                                 Right to Indemnification.  Notwithstanding the other provisions of this Article, to the extent that a director, officer, employee, or agent of the Corporation has been successful on the merits or otherwise in defense of any action, suit, or proceeding referred to in Section 7.1 or Section 7.2 of this Article, or in defense of any claim, issue, or matter in any such claim or issue, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with such defense.

 

Section 7.5.                                 Advance of Expenses.  Expenses incurred in defending a civil or criminal action, suit, or proceeding may be paid by the Corporation on behalf of a director, officer, employee, or agent in advance of the final disposition of such action, suit, or proceeding as authorized by the board of directors in the specific case upon receipt of an undertaking by or on behalf of the director, officer, employee, or agent to repay such amount unless it shall ultimately be determined that such person is entitled to be indemnified by the Corporation as authorized in this Article.

 

Section 7.6.                                 Indemnification Not Exclusive.  The indemnification provided by this Article shall not be deemed exclusive of any other rights to which any person seeking indemnification may be entitled under any law, agreement, vote of stockholders or disinterested directors, or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, and shall continue as to a person who has ceased to be a director, officer, employee, or agent and shall inure to the benefit of the heirs, executors, and administrators of such a person.

 

Section 7.7.                                 Insurance.  The Corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee, or agent of the Corporation, or

 

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is or was serving at the request of the Corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the Corporation would have the power to indemnify such person against liability under the provisions of this Article.

 

Section 7.8.                                 Definitions of Certain Terms.  For purposes of this Article, references to “the Corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, employees, or agents, so that any person who is or was a director, officer, employee, or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee, or agent of another corporation, partnership, joint venture, trust, or other enterprise, shall stand in the same position under the provisions of this Article with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued.

 

For purposes of this Article, references to “other enterprises” shall include employee benefit plans; references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; references to “serving at the request of the Corporation” shall include any service as a director, officer, employee, or agent of the Corporation which imposes duties on, or involves services by, such director, officer, employee, or agent with respect to an employee benefit plan, its participants, or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Article.

 

Section 7.9.                                 Liability of Directors.  Notwithstanding any provision of the Certificate of Incorporation or any other provision in these Bylaws, no director shall be personally liable to the Corporation or any stockholder for monetary damages for breach of fiduciary duty as a director, except for any matter in respect of which such director shall be liable under Section 174 of Title 8 of the Delaware Code (relating to the Delaware General Corporation Law) or any amendment or successor provision to such provision or shall be liable by reason that, in addition to any and all other requirements for such liability, he (a) shall have breached his duty of loyalty to the Corporation or its stockholders, (b) shall not have acted in good faith, (c) shall have acted in a manner involving intentional misconduct or a knowing violation of law or, in failing to act, shall have acted in a manner involving intentional misconduct or a knowing violation of law or (d) shall have derived an improper personal benefit.

 

ARTICLE 8

 

CERTIFICATES OF STOCK

 

Section 8.1.                                 Certificates.  Every holder of stock in the Corporation shall be entitled to have a certificate, signed by, or in the name of the Corporation by, the chairman or vice chairman of the board of directors, or the president or a vice president and the treasurer or an assistant

 

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treasurer, or the secretary or an assistant secretary of the Corporation, certifying the number of shares owned by him in the Corporation.

 

Section 8.2.                                 Facsimile Signatures.  Any of or all the signatures on the certificate may be facsimile.  In case any officer, transfer agent, or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent, or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if he were such officer, transfer agent, or registrar at the date of issue.

 

Section 8.3.                                 Lost Certificates.  The board of directors may direct a new certificate or certificates to be issued in place of any certificate or certificates previously issued by the Corporation alleged to have been lost, stolen, or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen, or destroyed.  When authorizing such issue of a new certificate or certificates, the board of directors may, in its discretion and as a condition precedent to the issuance of such new certificate or certificates, require the owner of such lost, stolen, or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the certificate alleged to have been lost, stolen, or destroyed.

 

Section 8.4.                                 Transfers of Stock.  Upon surrender to the Corporation or the transfer agent of the Corporation of a certificate for shares duly endorsed or accompanied by proper evidence of succession, assignment, or authority to transfer, it shall be the duty of the Corporation to issue a new certificate to the person entitled to such certificate, cancel the old certificate and record the transaction upon its books.

 

Section 8.5.                                 Fixing Record Date.  In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of stockholders or any adjournment of any meeting of stockholders, or to express consent to corporate action in writing without a meeting, or to receive payment of any dividend or other distribution or allotment of any rights, or to exercise any rights in respect of any change, conversion, or exchange of stock or for the purpose of any other lawful action, the board of directors may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days before the date of such meeting, nor more than 60 days prior to any other action.  A determination of stockholders of record entitled to notice of or to vote at a meeting of stockholders shall apply to any adjournment of the meeting; provided, that the board of directors may fix a new record date for the adjourned meeting.

 

Section 8.6.                                 Registered Stockholders.  The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice of such claim or interest, except as otherwise provided by the laws of Delaware.

 

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ARTICLE 9

 

AFFILIATED TRANSACTIONS

 

Section 9.1.                                 Validity.  Except as otherwise provided for in the Certificate of Incorporation and except as otherwise provided in these Bylaws, if Section 9.2 is satisfied, no contract or transaction between the Corporation and any of its directors, officers, or security holders, or any corporation, partnership, association, or other organization in which any of such directors, officers, or security holders are directly or indirectly financially interested, shall be void or voidable solely because of this relationship, or solely because of the presence of the director, officer, or security holder at the meeting authorizing the contract or transaction, or solely because of his or their participation in the authorization of such contract or transaction or vote at the meeting for authorization of such contract or transaction, whether or not such participation or vote was necessary for the authorization of such contract or transaction.

 

Section 9.2.                                 Disclosure; Approval; FairnessSection 9.1 shall apply only if:

 

(a)                                 the material facts as to the relationship or interest and as to the contract or transaction are disclosed or are known:

 

(i)                                     to the board of directors (or committee of the board of directors) and it nevertheless in good faith authorizes or ratifies the contract or transaction by a majority of the directors present, each such interested director to be counted in determining whether a quorum is present but not in calculating the majority necessary to carry the vote; or

 

(ii)                                  to the stockholders and they nevertheless authorize or ratify the contract or transaction by a majority of the shares present at a meeting considering such contract or transaction, each such interested person (stockholder) to be counted in determining whether a quorum is present and for voting purposes; or

 

(b)                                 the contract or transaction is fair to the Corporation as of the time it is authorized or ratified by the board of directors (or committee of the board of directors) or the stockholders.

 

Section 9.3.                                 Nonexclusive.  This provision shall not be construed to invalidate a contract or transaction which would be valid in the absence of this provision.

 

ARTICLE 10

 

GENERAL PROVISIONS

 

Section 10.1.                          Dividends.  Dividends upon the capital stock of the Corporation, subject to the provisions of the Certificate of Incorporation, if any, may be declared by the board of directors at any regular or special meeting, pursuant to law.  Dividends may be paid in cash, in

 

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property, or in shares of the capital stock, subject to the provisions of the Certificate of Incorporation.

 

Section 10.2.                          Reserves.  Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for such other purpose as the directors shall think conducive to the interest of the Corporation, and the directors may modify or abolish any such reserve in the manner in which it was created.

 

Section 10.3.                          Checks.  All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the board of directors may from time to time designate.

 

Section 10.4.                          Fiscal Year.  The fiscal year of the Corporation shall be fixed by resolution of the board of directors.

 

Section 10.5.                          Seal.  The board of directors may adopt a corporate seal having inscribed on such seal the name of the Corporation, the year of its organization, and the words “Corporate Seal, Delaware.”  The seal may be used by causing it or a facsimile of it to be impressed or affixed or reproduced or otherwise.

 

ARTICLE 11

 

AMENDMENTS

 

Section 11.1.                          Amendments.  These Bylaws may be altered, amended, or repealed or new Bylaws may be adopted by a majority of the entire board of directors, at any meeting of the board of directors if notice of such alteration, amendment, repeal, or adoption of new Bylaws be contained in the notice of such meeting.  The stockholders of the Corporation shall have the power to adopt, amend, or repeal any provisions of the Bylaws only to the extent and in the manner provided in the Certificate of Incorporation of the Corporation.

 

ARTICLE 12

 

ADVISORY COMMITTEES

 

Section 12.1.                          Advisory Committees.  The board of directors may, in its discretion, establish one or more technical, strategic or scientific advisory committees and appoint one or more persons as members of such advisory committees to serve in such capacity at the pleasure of the board.  Each member of an advisory committee shall be entitled to receive such amounts as may be fixed from time to time by the board of directors as compensation for attending committee meetings and may be reimbursed for all reasonable expenses in attending and returning from any committee meeting.  No advisory committee may set policy or be part of the corporate governance of the Corporation, and no advisory committee member may be responsible for the implementation of strategies or, in his or her capacity as a member of such

 

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committee, be involved in the management of the Corporation.  Subject to the foregoing restrictions, the board may adopt a charter or other governing documents of any advisory board.

 

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Exhibit 4.3

 

MIRNA THERAPEUTICS, INC.

 

SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

THIS SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this “Agreement”) is entered into as of this 22nd day of October, 2012, by and among MIRNA THERAPEUTICS, INC., a Delaware corporation (the “Company”), and each of the persons and entities listed on Exhibit A hereto (the “Investors” and each individually an “Investor”).

 

RECITALS

 

WHEREAS, certain of the Investors and the Company have previously entered into that certain Amended and Restated Investor Rights Agreement dated as of August 10, 2011 (the “Prior Agreement”);

 

WHEREAS, the Prior Agreement may be amended, and any provision therein waived, with the written consent of the Company and certain Holders (as defined in the Prior Agreement) pursuant to Section 5.5 of the Prior Agreement;

 

WHEREAS, on the date of this Agreement, certain of the Investors (the “Series C Purchasers”) are purchasing, severally and not jointly, shares of the Company’s Series C Preferred Stock, par value $0.001 per share (the “Series C Preferred Stock”), pursuant to that certain Series C Preferred Stock Purchase Agreement dated as of the date hereof (the “Purchase Agreement”), by and among the Company and the Series C Purchasers (the “Series C Financing”);

 

WHEREAS, the obligations of the Company and the Investors in the Purchase Agreement are conditioned upon the execution and delivery of this Agreement; and

 

WHEREAS, in connection with the consummation of the Series C Financing, the Company and the Investors have agreed to the registration rights, information rights, and other rights with respect to the Preferred Stock (as defined below) held by the Investors as set forth below and have agreed to amend and restate the Prior Agreement as set forth herein;

 

Now, THEREFORE, in consideration of these premises and for other good and valid consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Investors who constitute the requisite parties necessary to amend the Prior Agreement hereby agree that the Prior Agreement shall be amended and restated in its entirety by this Agreement, and the parties hereto further agree as follows:

 

AGREEMENT

 

SECTION 1.                         DEFINITIONS.

 

As used in this Agreement the following terms shall have the following respective meanings:

 



 

(a)                                 Affiliate” means, with respect to any specified person, any other person who or which, directly or indirectly, controls, is controlled by, or is under common control with such specified person, including without limitation any partner, officer, director, manager or employee of such person and any venture capital or private equity fund now or hereafter existing that is controlled by or under common control with one or more general partners or managing members of, or shares the same management company with, such person.

 

(b)                                 Common Stock” means common stock, par value $0.001 per share, of the Company.

 

(c)                                  Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

(d)                                 Form S-3” means such form under the Securities Act as in effect on the date hereof or any successor or similar registration form under the Securities Act subsequently adopted by the SEC which permits inclusion or incorporation of substantial information by reference to other documents filed by the Company with the SEC.

 

(e)                                  GAAP” means generally accepted accounting principles in the United States.

 

(f)                                   Holder” means any person owning of record Registrable Securities that have not been sold to the public or any assignee of record of such Registrable Securities in accordance with Section 2.9 hereof.

 

(g)                                 Initial Offering” means the Company’s first firm commitment underwritten public offering of its Common Stock registered under the Securities Act.

 

(h)                                 Investment Company Act” means the Investment Company Act of 1940, as amended.

 

(i)                                    NEA” means New Enterprise Associates 14, L.P., NEA Ventures 2012, Limited Partnership and their respective Affiliates.

 

(j)                                    Pfizer” means Pfizer Inc. and its Affiliates.

 

(k)                                 Preferred Directors” has the meaning set forth in the Restated Certificate.

 

(l)                                    Preferred Stock” means, collectively, the Series A Preferred Stock, the Series B Preferred Stock, the Series B-1 Preferred Stock and the Series C Preferred Stock.

 

(m)                             Register,” “registered,” and “registration” refer to a registration effected by preparing and filing a registration statement in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document.

 

(n)                                 Registrable Securities” means (a) Common Stock of the Company issuable or issued upon conversion of the Preferred Stock, (b) Common Stock of the Company held by the Investors (other than shares of Common Stock of the Company issued or issuable

 

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upon exercise of options or other awards granted pursuant to stock purchase or stock option plans or other similar incentive plans or arrangements), (c) Common Stock of the Company held by a transferee or assignee of Registrable Securities who has agreed in writing to be bound by the terms of this Agreement under Section 2.9, and (d) any Common Stock of the Company issued as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, such above-described securities (other than shares of Common Stock of the Company issued or issuable upon exercise of options or other awards granted pursuant to stock purchase or stock option plans or other similar incentive plans or arrangements). Notwithstanding the foregoing, Registrable Securities shall not include any securities (i) sold by a person to the public either pursuant to a registration statement or Rule 144, (ii) sold in a private transaction in which the transferor’s rights under Section 2 of this Agreement are not assigned or (iii) held by a Holder (together with its Affiliates) if, as reflected on the Company’s list of stockholders, such Holder (together with its Affiliates) holds less than 1% of the Company’s outstanding Common Stock (treating all shares of Preferred Stock on an as-converted basis), the Company has completed its Initial Offering and all shares of Common Stock of the Company issuable or issued upon conversion of the Shares held by and issuable to such Holder (and its Affiliates) may be sold pursuant to Rule 144 without limitation during any ninety (90) day period.  A Holder of Registrable Securities need not convert such Registrable Securities into Common Stock prior to requesting registration hereunder but may make such request in contemplation of conversion of such Registrable Securities into Common Stock prior to the effectiveness of such registration.

 

(o)                                 Registrable Securities then outstanding” shall be the number of shares of the Company’s Common Stock that are Registrable Securities and either (a) are then issued and outstanding or (b) are issuable pursuant to then exercisable or convertible securities.

 

(p)                                 Registration Expenses” shall mean all expenses incurred by the Company in complying with Sections 2.1, 2.2 and 2.3 hereof, including, without limitation, all registration and filing fees, printing and accounting expenses, fees and disbursements of counsel for the Company, reasonable fees and disbursements of a single special counsel for the selling Holders, blue- sky fees and expenses and the expense of any special audits incident to or required by any such registration (but excluding the compensation of regular employees of the Company which shall be paid in any event by the Company).

 

(q)                                 Required Holders” means the Investors holding at least a majority of the then outstanding shares of Preferred Stock.

 

(r)                                  Restated Certificate” means the Fourth Amended and Restated Certificate of Incorporation of the Company, as amended from time to time.

 

(s)                                   Right of First Refusal Agreement” means the Second Amended and Restated Right of First Refusal and Co-Sale Agreement of even date herewith by and among the Company, the Investors and certain other parties named therein.

 

(t)                                    SEC’ or “Commission” means the Securities and Exchange Commission.

 

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(u)                                 Securities Act” shall mean the Securities Act of 1933, as amended.

 

(v)                                 Selling Expenses” shall mean all underwriting discounts and selling commissions applicable to the sale of Registrable Securities.

 

(w)                               Series A Preferred Stock” shall mean Series A preferred stock, par value $0.001 per share, of the Company.

 

(x)                                 Series B Preferred Stock” shall mean Series B preferred stock, par value $0.001 per share, of the Company.

 

(y)                                 Series B-1 Preferred Stock” shall mean Series B-1 preferred stock, par value $0.001 per share, of the Company.

 

(z)                                  Shares” shall mean the Preferred Stock held by the Investors listed on Exhibit A hereto and their permitted assigns.

 

(aa)                          Sofinnova” shall mean Sofinnova Venture Partners VIII, L.P. and its Affiliates.

 

(bb)                          Special Registration Statement” shall mean (i) a registration statement relating to any employee benefit plan, (ii) a registration statement with respect to any corporate reorganization or transaction under Rule 145 of the Securities Act, including any registration statements related to the issuance or resale of securities issued in such a transaction, or (iii) a registration statement in which the only Common Stock being registered is Common Stock issued upon conversion of debt securities that are also being registered

 

(cc)                            Transfer” shall mean any direct or indirect sale, transfer, assignment, exchange, pledge, hypothecation, mortgage or grant of a proxy, or any other encumbrance or disposition of an interest.

 

SECTION 2.                         REGISTRATION.

 

2.1                               Demand Registration.

 

(a)                                 Subject to the conditions of this Section 2.1, if the Company shall receive a written request from the Required Holders (for purposes of this Section 2.1, the “Initiating Holders”) that the Company file a registration statement under the Securities Act covering the registration of at least twenty percent (20%) of shares of the Common Stock issuable or issued upon conversion of the Preferred Stock (the “Preferred Stock Registrable Securities”), then the Company shall, within fifteen (15) days after the receipt thereof, give written notice of such request to all Holders, and subject to the limitations of this Section 2.1, shall, as expeditiously as possible and in any event within sixty (60) days after receipt of the request from the Initiating Holders, file a registration statement under the Securities Act of all Registrable Securities that the Initiating Holders requested to be registered and any additional Registrable Securities that all other Holders request to be registered, as specified by notice given by each such other Holder to the Company within twenty (20) days after the date that the written notice by the Company referred to above is given.

 

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(b)                                 Notwithstanding the foregoing obligations, if the Company furnishes to the Initiating Holders a certificate signed by the Company’s chief executive officer stating that in the good faith judgment of the Company’s board of directors (the “Board”) it would be materially detrimental to the Company and its stockholders for such registration statement to either become effective or remain effective for as long as such registration statement otherwise would be required to remain effective, because such action would (i) materially interfere with a significant acquisition, corporate reorganization, or other similar transaction involving the Company; (ii) require premature disclosure of material information that the Company has a bona fide business purpose for preserving as confidential or (iii) render the Company unable to comply with requirements under the Securities Act or Exchange Act, then the Company shall have the right to defer taking action with respect to such filing, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly, for a period of not more than ninety (90) days after the request of the Initiating Holders is given; provided, however, that the Company may not invoke this right more than once in any twelve (12) month period; and provided, further, that the Company shall not register any securities for its own account or that of any other stockholder during such ninety (90) day period other than pursuant to a Special Registration Statement.

 

(c)                                  If the Initiating Holders intend to distribute the Preferred Stock Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request made pursuant to this Section 2.1 or any request pursuant to Section 2.3 and the Company shall include such information in the written notice referred to in Section 2.1(a) or Section 2.3(a), as applicable.  In such event, the right of any Holder to include its Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein.  All Holders proposing to distribute their securities through such underwriting shall, together with the Company as provided in Section 2.5(e), enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting by a majority in interest of the Initiating Holders (which underwriter or underwriters shall be reasonably acceptable to the Company).  Notwithstanding any other provision of this Section 2.1 or Section 2.3, if the managing underwriter advises the Company that marketing factors require a limitation of the number of securities to be underwritten (including Preferred Stock Registrable Securities) then the Company shall so advise all Holders of Registrable Securities that would otherwise be underwritten pursuant hereto, and the number of shares that may be included in the underwriting shall be allocated to the Holders of such Registrable Securities on a pro rata basis based on the number of Registrable Securities held by all such Holders (including the Initiating Holders); provided, however, that the number of shares of Preferred Stock Registrable Securities to be included in such underwriting and registration shall not be reduced unless all other securities of the Company are first entirely excluded from the underwriting and registration.  Any Registrable Securities excluded or withdrawn from such underwriting shall be withdrawn from the registration.

 

(d)                                 The Company shall not be required to effect a registration pursuant to this Section 2.1:

 

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(i)                                    prior to the earlier of (A) the third anniversary of the date hereof or (B) one hundred eighty (180) days following the effective date of the registration statement pertaining to the Initial Offering;

 

(ii)                                after the Company has effected two (2) registrations pursuant to this Section 2.1, and such registrations have been declared or ordered effective;

 

(iii)                            if within fifteen (15) days of receipt of a written request from the Initiating Holders pursuant to Section 2.1(a), the Company gives notice to each of the Initiating Holders of the Company’s intention to file a registration statement for its Initial Offering within ninety (90) days after receipt of such written request from the Initiating Holders, provided that the Company is actively employing in good faith commercially reasonable efforts to cause such registration statement to become effective during such period;

 

(iv)                             if the Initiating Holders propose to dispose of shares of Preferred Stock Registrable Securities that may be immediately registered on Form S-3 pursuant to a request made pursuant to Section 2.3 below; or

 

(v)                                 in any particular jurisdiction in which the Company would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance unless the Company is already qualified to do business or subject to service of process, as applicable, in such jurisdiction and except as may be required by the Securities Act.

 

2.2                               Piggyback Registrations.  The Company shall notify all Holders of Registrable Securities in writing at least twenty (20) days prior to the filing of any registration statement under the Securities Act for purposes of a public offering of securities of the Company (including, but not limited to, registration statements relating to secondary offerings of securities of the Company, but excluding Special Registration Statements) and will afford each such Holder an opportunity to include in such registration statement, and the Company shall cause to be registered, all or part of such Registrable Securities held by such Holder.  Each Holder desiring to include in any such registration statement all or any part of the Registrable Securities held by it shall, within fifteen (15) days after receipt of the above-described notice from the Company, so notify the Company in writing.  Such notice shall state the intended method of disposition of the Registrable Securities by such Holder.  If a Holder decides not to include all of its Registrable Securities in such registration statement filed by the Company, such Holder shall nevertheless continue to have the right to include any Registrable Securities in any subsequent registration statement or registration statements as may be filed by the Company with respect to offerings of its securities, all upon the terms and conditions set forth herein.

 

(a)                                 Underwriting.  If the registration statement under which the Company gives notice under this Section 2.2 is for an underwritten offering, the Company shall so advise the Holders of Registrable Securities.  In such event, the right of any such Holder to be included in a registration pursuant to this Section 2.2 shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting to the extent provided herein.  All Holders proposing to distribute their Registrable Securities through such underwriting shall enter into an underwriting agreement in

 

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customary form with the underwriter or underwriters selected for such underwriting by the Company.  Notwithstanding any other provision of this Agreement, if the underwriter determines in good faith that marketing factors require a limitation of the number of shares to be underwritten, the number of shares that may be included in the underwriting shall be allocated, first, to the Company; second, to the holders of Preferred Stock Registrable Securities (the “Preferred Holders”) on a pro rata basis based on the total number of Preferred Stock Registrable Securities held by such Preferred Holders; third, to the Holders (other than the Preferred Holders) on a pro rata basis based on the total number of Registrable Securities held by such Holders; and fourth, to any stockholder of the Company (other than a Holder) on a pro rata basis; provided, however, that no such reduction shall reduce the amount of securities of the selling Holders included in the registration below thirty percent (30%) of the total amount of securities included in such registration, unless such offering is the Initial Offering and such registration does not include shares of any other selling stockholders, in which event any or all of the Registrable Securities of the Holders may be excluded in accordance with the immediately preceding clause.  In no event will shares of any other selling stockholder be included in such registration that would reduce the number of shares which may be included by Holders without the written consent of Holders of not less than a majority of the Registrable Securities (including a majority of the Preferred Stock Registrable Securities, if applicable) proposed to be sold in the offering.  If any Holder disapproves of the terms of any such underwriting, such Holder may elect to withdraw therefrom by written notice to the Company and the underwriter, delivered at least ten (10) business days prior to the effective date of the registration statement.  Any Registrable Securities excluded or withdrawn from such underwriting shall be excluded and withdrawn from the registration.  For any Holder that is a partnership or corporation, the partners, retired partners, members, former members and stockholders of such Holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing person shall be deemed to be a single “Holder,” and any pro rata reduction with respect to such “Holder” shall be based upon the aggregate amount of shares carrying registration rights owned by all entities and individuals included in such “Holder,” as defined in this sentence.

 

(b)                                 Right to Terminate Registration.  The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 2.2 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration.  The Registration Expenses of such withdrawn registration shall be borne by the Company in accordance with Section 2.4 hereof.

 

2.3                               Form S-3 Registration.  In case the Company shall receive from any Holder or Holders of Registrable Securities a written request or requests that the Company effect a registration on Form S-3 (or any successor to Form S-3) or any similar short-form registration statement and any related qualification or compliance with respect to all or a part of the Registrable Securities owned by such Holder or Holders, the Company shall:

 

(a)                                 promptly (and in any event within fifteen (15) days after such written request is delivered) give written notice of the proposed registration, and any related qualification or compliance, to all other Holders of Registrable Securities; and

 

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(b)                                 as soon as practicable, effect such registration and all such qualifications and compliances as may be so requested and as would permit or facilitate the sale and distribution of all or such portion of such Holder’s or Holders’ Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any other Holder or Holders joining in such request as are specified in a written request given within fifteen (15) days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance pursuant to this Section 2.3:

 

(i)                                    if Form S-3 is not available for such offering by the Holders;

 

(ii)                                if the Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) at an aggregate price to the public of less than one million dollars ($1,000,000);

 

(iii)                            if within fifteen (15) days of receipt of a written request from any Holder or Holders pursuant to this Section 2.3, the Company gives notice to such Holder or Holders of the Company’s intention to make a public offering within ninety (90) days after receipt of such written request from such Holder or Holders, other than pursuant to a Special Registration Statement; provided that the Company is actively employing in good faith commercially reasonable efforts to cause such registration statement to become effective during such period; provided, further, that such Holders were permitted to register such shares as requested to be registered pursuant to Section 2.2 hereof without reduction by the underwriter thereof;

 

(iv)                             if the Company has, within the twelve (12) month period preceding the date of such written request, already effected two (2) registrations on Form S-3 for the Holders pursuant to this Section 2.3; or

 

(v)                                 in any particular jurisdiction in which the Company would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance unless the Company is already qualified to do business or subject to service of process, as applicable, in such jurisdiction and except as may be required by the Securities Act.

 

(c)                                  Subject to the foregoing, the Company shall file a Form S-3 registration statement covering the Registrable Securities and other securities so requested to be registered as soon as practicable after receipt of the requests of the Holders.  Registrations effected pursuant to this Section 2.3 shall not be counted as demands for registration or registrations effected pursuant to Section 2.1.

 

(d)                                 Notwithstanding the foregoing obligations, if the Company furnishes to the Holder or Holders requesting a registration pursuant to this Section 2.3 a certificate signed by the Company’s chief executive officer stating that in the good faith judgment of the Board it would be materially detrimental to the Company and its stockholders for such registration statement to either become effective or remain effective for as long as such registration statement

 

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otherwise would be required to remain effective, because such action would (i) materially interfere with a significant acquisition, corporate reorganization, or other similar transaction involving the Company; (ii) require premature disclosure of material information that the Company has a bona fide business purpose for preserving as confidential or (iii) render the Company unable to comply with requirements under the Securities Act or Exchange Act, then the Company shall have the right to defer taking action with respect to such filing, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly, for a period of not more than ninety (90) days after the request for registration on Form S-3 referred to in Section 2.3 is given; provided, however, that the Company may not invoke this right more than once in any twelve (12) month period; and provided, further, that the Company shall not register any securities for its own account or that of any other stockholder during such ninety (90) day period other than pursuant to a Special Registration Statement.

 

2.4                               Expenses of Registration.  Except as specifically provided herein, all Registration Expenses incurred in connection with any registration, qualification or compliance pursuant to Section 2.1 or any registration under Section 2.2 or Section 2.3 herein shall be borne by the Company.  All Selling Expenses incurred in connection with any registrations hereunder shall be borne by the holders of the securities so registered pro rata on the basis of the number of shares so registered.  The Company shall not, however, be required to pay for expenses of any registration proceeding begun pursuant to Section 2.1 or 2.3, the request of which has been subsequently withdrawn by the Holders which initiated such request unless (a) the withdrawal is based upon material adverse information concerning the Company of which such Holders were not aware at the time of such request or (b) the Holders of a majority of Registrable Securities then outstanding agree to forfeit their right to one (1) requested registration pursuant to Section 2.1 or 2.3, as applicable, in which event such right shall be forfeited by all Holders.  If the Holders are required to pay the Registration Expenses, such expenses shall be borne by the holders of securities (including Registrable Securities) requesting or joining such registration in proportion to the number of shares that were to be included in such registration.  If the Company is required to pay the Registration Expenses of a withdrawn offering pursuant to clause (a) above, then the Holders shall not forfeit their rights pursuant to Section 2.1 or 2.3.

 

2.5                               Obligations of the Company.  Whenever required to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

 

(a)                                 Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use best efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to one hundred twenty (120) days or, if earlier, until the Holder or Holders have completed the distribution related thereto; provided, however, that (i) such one hundred twenty (120) day period shall be extended for a period of time equal to the period the Holder refrains, at the request of an underwriter of Common Stock (or other securities) of the Company, from selling any securities included in such registration, and (ii) in the case of any registration of Registrable Securities on Form S-3 that are intended to be offered on a continuous or delayed basis, subject to compliance with applicable SEC rules, such one hundred twenty (120) day period shall be extended for up to sixty (60) days, if necessary, to keep the registration statement effective until all such Registrable Securities are sold;

 

9


 

(b)                                 Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement for the period set forth in subsection (a) above;

 

(c)                                  Comply with Rule 172 of the Securities Act and (i) advise the selling Holders promptly of any failure by the Company to satisfy the conditions of such Rule 172 and (ii) promptly furnish to the Holders such number of copies of a prospectus, including a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them;

 

(d)                                 Use best efforts to register and qualify the securities covered by such registration statement under such other securities or blue-sky laws of such jurisdictions as shall be reasonably requested by the Holders; provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions, unless the Company is already qualified to do business or subject to service of process, as applicable, in such jurisdiction and except as may be required by the Securities Act;

 

(e)                                  In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter(s) of such offering (each Holder participating in such underwriting shall also enter into and perform its obligations under such an agreement);

 

(f)                                   Use its best efforts to cause all such Registrable Securities covered by such registration statement to be listed on a national securities exchange or trading system and each securities exchange and trading system (if any) on which similar securities issued by the Company are then listed;

 

(g)                                 Provide a transfer agent and registrar for all Registrable Securities registered pursuant to this Agreement and provide a CUSIP number for all such Registrable Securities, in each case no later than the effective date of such registration;

 

(h)                                 Promptly make available for inspection by the selling Holders, any managing underwriter(s) participating in any disposition pursuant to such registration statement, and any attorney or accountant or other agent retained by any such underwriter or selected by the selling Holders, all financial and other records, pertinent corporate documents, and properties of the Company, and cause the Company’s officers, directors, employees, and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant, or agent, in each case, as necessary or advisable to verify the accuracy of the information in such registration statement and to conduct appropriate due diligence in connection therewith;

 

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(i)                                    Notify each selling Holder, promptly after the Company receives notice thereof, of the time when such registration statement has been declared effective or a supplement to any prospectus forming a part of such registration statement has been filed;

 

(j)                                    After such registration statements become effective, notify each selling Holder of any request by the SEC that the Company amend or supplement such registration statement or prospectus;

 

(k)                                 Promptly notify each selling Holder of any stop order issued or threatened by the SEC or any state securities commission and take all reasonable actions required to prevent the entry of such stop order or to remove it if entered;

 

(l)                                    Use its best efforts to prevent the issuance of any stop order or other suspension of effectiveness and, if such order is issued, obtain the withdrawal of any such order at the earliest possible moment;

 

(m)                             Notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing, and as promptly as practicable thereafter, prepare and file with the SEC, and furnish without charge to the appropriate Holders and managing underwriter(s), if any, an amendment or supplement to such registration statement or prospectus in order to cause such registration statement or prospectus not to include any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing and furnish such copies thereof as the Holders of any underwriter may reasonably request; and

 

(n)                                 Use best efforts to furnish, on the date that such Registrable Securities are delivered to the underwriters for sale, if such securities are being sold through underwriters, (i) an opinion, dated as of such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an underwritten public offering, addressed to the underwriters, if any, and (ii) a letter, dated as of such date, from the independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering addressed to the underwriters.

 

2.6                               Termination of Registration Rights.  All registration rights granted under this Section 2 shall terminate and be of no further force and effect upon the earlier to occur of (i) three (3) years after the date of the Company’s Initial Offering, or (ii) as to any Holder, at such time as such Holder could sell all of its Registrable Securities without limitation during any 90 day period under Rule 144 of the Securities Act.

 

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2.7                               Delay of Registration; Furnishing Information.

 

(a)                                 No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 2.

 

(b)                                 It shall be a condition precedent to the obligations of the Company to take any action pursuant to Section 2.1, 2.2 or 2.3 with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable Securities held by it and the intended method of disposition of such securities as shall be required to effect the registration of their Registrable Securities.

 

(c)                                  The Company shall have no obligation with respect to any registration requested pursuant to Section 2.1 or Section 2.3 if, due to the operation of subsection 2.1(b), the number of shares or the anticipated aggregate offering price of the Registrable Securities to be included in the registration does not equal or exceed the number of shares or the anticipated aggregate offering price required to originally trigger the Company’s obligation to initiate such registration as specified in Section 2.1 or Section 2.3, whichever is applicable.

 

2.8                               Indemnification.  In the event any Registrable Securities are included in a registration statement under Section 2.1, 2.2 or 2.3:

 

(a)                                 To the extent permitted by law, the Company will indemnify and hold harmless each selling Holder, the partners, members, stockholders, officers and directors of each such Holder, legal counsel and accountants of each such Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages, or liabilities (joint or several) to which they may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively a “Violation”) by the Company:  (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement or incorporated by reference therein, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading, or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any state securities law in connection with the offering covered by such registration statement; and the Company will reimburse each such Holder, partner, member, stockholder, officer, director, underwriter or controlling person, or other aforementioned person for any legal or other expenses reasonably incurred by them, as incurred, in connection with investigating or defending any such loss, claim, damage, liability or action; provided, however, that the indemnity agreement contained in this Section 2.8(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld, conditioned or delayed, nor shall the Company be liable in any such case for any such loss, claim, damage, liability or action to the extent that it

 

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arises out of or is based upon a Violation which occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by such Holder, partner, member, stockholder, officer, director, underwriter or controlling person, or other aforementioned person of such Holder.

 

(b)                                 To the extent permitted by law, each selling Holder will, if Registrable Securities held by such Holder are included in the securities as to which such registration qualifications or compliance is being effected, severally and not jointly, indemnify and hold harmless the Company, each of its directors, each of its officers who has signed the registration statement, and each person, if any, who controls the Company within the meaning of the Securities Act, any underwriter and any other Holder selling securities under such registration statement or any of such other Holder’s partners, members, stockholders, directors or officers or any person who controls such Holder, against any losses, claims, damages or liabilities (joint or several) to which the Company or any such director, officer, controlling person, underwriter or other such Holder, or partner, member, stockholder, director, officer or controlling person of such other Holder may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages or liabilities (or actions in respect thereto) arise out of or are based upon any of the following statements:  (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement or incorporated by reference therein, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state therein a material fact required to be stated therein, or necessary to make the statements therein not misleading, or (iii) any violation or alleged violation by the Company of the Securities Act (collectively, a “Holder Violation”), in each case to the extent (and only to the extent) that such Holder Violation occurs in reliance upon and in conformity with written information furnished by such Holder under an instrument duly executed by such Holder and stated to be specifically for use in connection with such registration; and each such Holder will reimburse any legal or other expenses reasonably incurred by the Company or any such director, officer, controlling person, underwriter or other Holder, or partner, member, stockholder, officer, director or controlling person of such other Holder, as incurred, in connection with investigating or defending any such loss, claim, damage, liability or action if it is judicially determined that there was such a Holder Violation; provided, however, that the indemnity agreement contained in this Section 2.8(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the prior written consent of the Holder, which consent shall not be unreasonably withheld, conditioned or delayed; provided further, that in no event shall any indemnity under this Section 2.8(b) when combined with the amounts paid or payable by such Holder pursuant to Section 2.8(d), exceed the net proceeds from the offering received by such Holder.

 

(c)                                  Promptly after receipt by an indemnified party under this Section 2.8 of notice of the commencement of any action (including any governmental action) for which a party may be entitled to indemnification hereunder, such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 2.8, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party shall have the

 

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right to retain its own counsel, with the fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding.  The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if materially prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this Section 2.8, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 2.8.

 

(d)                                 If the indemnification provided for in this Section 2.8 is held by a court of competent jurisdiction (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) to be unavailable to an indemnified party with respect to any losses, claims, damages or liabilities referred to herein, the indemnifying party, in lieu of indemnifying such indemnified party thereunder, shall to the extent permitted by applicable law contribute to the amount paid or payable by such indemnified party as a result of such loss, claim, damage or liability in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the Violation(s) or Holder Violation(s) that resulted in such loss, claim, damage or liability, as well as any other relevant equitable considerations.  The relative fault of the indemnifying party and of the indemnified party shall be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission; provided, that (x) no Holder will be required to contribute any amount in excess of the public offering price of all such Registrable Securities offered and sold by such Holder pursuant to such registration statement, and (y) in no event shall any contribution by a Holder hereunder, when combined with the amounts paid or payable by such Holder pursuant to Section 2.8(b), exceed the net proceeds from the offering received by such Holder.

 

(e)                                  The obligations of the Company and Holders under this Section 2.8 shall survive completion of any offering of Registrable Securities in a registration statement and the termination of this Agreement.  No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a release from all liability in respect to such claim or litigation.

 

2.9                               Assignment of Registration Rights.  The rights to cause the Company to register Registrable Securities pursuant to this Section 2 may be assigned by a Holder to a transferee or assignee of Registrable Securities that (a) is a partner or retired partner of any Holder that is a partnership, (b) is a member or former member of any Holder that is a limited liability company, (c) is a Holder’s family member or trust for the benefit of such family member or of an individual Holder, (d) is an Affiliate of such Holder, (e) is any affiliated venture capital fund of an Investor, or (f) is a transferee which acquires at least twenty-five percent (25%) of the shares of Preferred Stock held by the transferor; provided, however, (i) the transferor shall, within ten

 

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(10) days after such transfer, furnish to the Company written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned and (ii) such transferee shall agree to be subject to all restrictions set forth in this Agreement.

 

2.10                        Amendment of Registration Rights.  Any provision of this Section 2 may be amended and the observance thereof may be waived (either generally or in a particular instance and either retroactively or prospectively), only with the written consent of the Company and the Holders of a majority of the Registrable Securities then outstanding (including a majority of shares of the Preferred Stock then outstanding).  Any amendment or waiver effected in accordance with this Section 2.10 shall be binding upon each Holder and the Company.  By acceptance of any benefits under this Section 2, the Holders of Registrable Securities hereby agree to be bound by the provisions hereunder.

 

2.11                        Limitation on Subsequent Registration Rights.  Other than as provided in Section 5.10, after the date of this Agreement, the Company shall not, without the prior written consent of the Holders of a majority of the Registrable Securities then outstanding (including a majority of shares of the Preferred Stock then outstanding), enter into any agreement with any holder or prospective holder of any securities of the Company that would grant such holder registration rights senior to those granted to the Holders hereunder, other than the right to a Special Registration Statement.

 

2.12                        Market Stand-Off” Agreement.  Each Holder hereby agrees that such Holder shall not sell, transfer, make any short sale of, grant any option for the purchase of, or enter into any hedging or similar transaction with the same economic effect as a sale with respect to, any Common Stock (or other securities) of the Company held by such Holder (other than those included in the registration) for a period specified by the representative of the underwriters of Common Stock (or other securities) of the Company not to exceed one hundred eighty (180) days following the effective date of a registration statement of the Company filed under the Securities Act; provided that:

 

(a)                                 such agreement shall apply only to the Company’s Initial Offering; and

 

(b)                                 all officers and directors of the Company and holders of at least one percent (1%) of the Company’s voting securities are subject to the same restrictions.

 

2.13                        Agreement to Furnish Information.  Each Holder agrees to execute and deliver such other agreements as may be reasonably requested by the Company or the underwriter that are consistent with the Holder’s obligations under Section 2.12 or that are necessary to give further effect thereto.  In addition, if requested by the Company or the representative of the underwriters of Common Stock (or other securities) of the Company, each Holder shall provide, within ten (10) days of such request, such information as may be required by the Company or such representative in connection with the completion of any public offering of the Company’s securities pursuant to a registration statement filed under the Securities Act.  The obligations described in Section 2.12 and this Section 2.13 shall not apply to a Special Registration Statement.  The Company may impose stop-transfer instructions with respect to the shares of Common Stock (or other securities) subject to the foregoing restriction until the end of said one

 

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hundred eighty (180) day period.  Each Holder agrees that any transferee of any shares of Registrable Securities shall be bound by Sections 2.12 and 2.13.  The underwriters of the Company’s stock are intended third party beneficiaries of Sections 2.12 and 2.13 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto.

 

2.14                        Rule 144 Reporting.  With a view to making available to the Holders the benefits of certain rules and regulations of the SEC which may permit the sale of the Registrable Securities to the public without registration, the Company shall:

 

(a)                                 Make and keep public information available, as those terms are understood and defined in SEC Rule 144 or any similar or analogous rule promulgated under the Securities Act, at all times after the effective date of the first registration filed by the Company for an offering of its securities to the general public;

 

(b)                                 File with the SEC, in a timely manner, all reports and other documents required of the Company under the Exchange Act; and

 

(c)                                  So long as a Holder owns any Registrable Securities, furnish to such Holder forthwith upon request:  (i) a written statement by the Company as to its compliance with the reporting requirements of said Rule 144 of the Securities Act, and of the Exchange Act (at any time after it has become subject to such reporting requirements), or its qualification as a registrant whose securities may be resold pursuant to Form S-3 (at any time after the Company so qualifies); (ii) a copy of the most recent annual or quarterly report and such other periodic reports of the Company filed with the Commission; and (iii) such other reports and documents as a Holder may reasonably request in connection with availing itself of any rule or regulation of the SEC allowing it to sell any such securities without registration or pursuant to such Form S-3.

 

SECTION 3.                         COVENANTS OF THE COMPANY.

 

3.1                               Basic Financial Information and Reporting.

 

(a)                                 The Company shall maintain true books and records of account in which full and correct entries will be made of all its business transactions pursuant to a system of accounting established and administered in accordance with GAAP consistently applied, and will set aside on its books all such proper accruals and reserves as shall be required under GAAP consistently applied.

 

(b)                                 So long as an Investor (with its Affiliates) shall own not less than 250,000 shares (as adjusted for any stock dividends, splits, combinations, recapitalizations and the like) of Registrable Securities (each, a “Significant Holder”), as soon as practicable and in any event within one hundred twenty (120) days after the end of each fiscal year of the Company, the Company shall furnish each Significant Holder (i) an audited consolidated balance sheet of the Company, as at the end of such fiscal year, and audited consolidated statements of income and cash flows of the Company, for such year, all prepared in accordance with GAAP consistently applied and setting forth in each case in comparative form the figures for the previous fiscal year and as included in the Budget (as defined below) for such year, with an

 

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explanation of any material differences between such figures, all in reasonable detail, and (ii) a statement of stockholders’ equity as of the end of such year.  Such financial statements shall be accompanied by a report and opinion thereon by independent public accountants of national standing selected by the Board, including a majority of the Preferred Directors.

 

(c)                                  The Company shall furnish each Significant Holder, as soon as practicable and in any event within forty-five (45) days after the end of each of the first three (3) fiscal quarters of the Company, (i) an unaudited consolidated balance sheet of the Company as of the end of such fiscal quarter and unaudited consolidated statements of income and cash flows of the Company for such fiscal quarter, all prepared in accordance with GAAP consistently applied (except that such financial statements may (x) be subject to normal year-end audit adjustments and (y) not contain all notes thereto that may be required in accordance with GAAP), and (ii) a statement of stockholders’ equity as of the end of such fiscal quarter.

 

(d)                                 The Company shall furnish each Significant Holder, as soon as practicable and in any event within thirty (30) days after the end of each month, (i) an unaudited consolidated balance sheet of the Company as of the end of each month, and unaudited consolidated statements of income and cash flows of the Company, together with supporting schedules, for such month and for the current fiscal year to date, prepared in accordance with GAAP consistently applied setting forth in comparative form (x) the Company’s projected financial statements for the current fiscal year to date as included in the Budget and (y) the Company’s financial statements for the corresponding periods for the immediately preceding fiscal year, and (ii) a statement of stockholders’ equity as of the end of such month.

 

(e)                                  The Company will furnish each Significant Holder:  (i) at least thirty (30) days prior to the beginning of each fiscal year a detailed annual and monthly budget, projected annual and monthly financial statements, and operating plans for such fiscal year, together with a written discussion of the operating plan (the “Budget”), and as soon as available, any subsequent written revisions thereto; (ii) within ten (10) days of delivery, such other notices, information and data with respect to the Company as the Company delivers to the holders of Common Stock; and (iii) promptly, such other information and data as such Significant Holder may from time to time reasonably request.

 

(f)                                   On and after the date on which the Company becomes subject to the requirements under either Section 13 or 15(d) of the Exchange Act, the Company may send to each Significant Holder the reports, including the financial statements contained therein, that are required to be filed with the Commission under the Exchange Act in lieu of the financial information and certificates required to be delivered under this Section 3.1.

 

3.2                               Inspection Rights.  Each Significant Holder shall have the right to visit and inspect any of the properties of the Company or any of its subsidiaries, and to discuss the affairs, finances and accounts of the Company or any of its subsidiaries with its officers, and to review such information as is reasonably requested all at such reasonable times and as often as may be reasonably requested; provided, however, that the Company shall not be obligated under this Section 3.2 with respect to a competitor of the Company or with respect to information which the Board determines in good faith is confidential or attorney-client privileged and should not, therefore, be disclosed.  Notwithstanding anything to the contrary contained in this Agreement,

 

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in the event that Pfizer is deemed to be a competitor of the Company, the investment, legal, finance, tax, accounting and audit personnel of Pfizer and its Affiliates may exercise the rights set forth in this Section 3.2 solely for the purpose of managing, evaluating and reporting on Pfizer’s investment in the Company.

 

3.3                               Confidentiality of Records.  Each Investor agrees that it shall keep confidential and shall not disclose or divulge any confidential, proprietary, or secret information which such Investor may obtain from the Company pursuant to the financial statements, reports, and other materials submitted by the Company to such Investor pursuant to this Agreement or otherwise, or pursuant to visitation or inspection rights granted under this Agreement, unless (a) such information enters the public domain through no fault of such Investor, (b) such information is communicated to such Investor by a third party without breach of any obligation of confidentiality such third party may have to the Company, (c) the Company provides written consent to the disclosure of such information, (d) such information is developed by Investor or its agents independently of and without reference to any confidential information communicated by the Company, or (e) required by a valid order of a court or governmental body having jurisdiction or otherwise required by law, statutes, rules or regulations or pursuant to any direction, request or requirement (whether or not having the force of law but if not having the force of law being of a type with which institutional or corporate investors in the relevant jurisdiction are accustomed to comply) of any self-regulating organization or any governmental, fiscal, monetary or other authority; provided, however, that an Investor may disclose such information (A) to its partners, subsidiaries, parents, officers, employees, agents, directors, Affiliates, attorneys, accountants, consultants, and other professionals for the purpose of evaluating its investment in the Company as long as such attorneys, advisors, accountants, partners, subsidiaries, parents, officers, employees, agents, directors or Affiliates are advised of the confidentiality provisions of this Section 3.3, (B) to any prospective purchaser of any Shares from such Investor as long as such prospective purchaser agrees in writing to be bound by the provisions of this Section 3.3, (C) for internal market, industry and investment analyses, or (D) to any Affiliate of such Investor or to a partner or stockholder of such Purchaser; and provided, further, that if any Investor is required or requested to disclose information pursuant to (e) above, such Investor shall use its commercially reasonable efforts to limit such disclosure and to obtain confidential treatment or a protective order for such information and shall give the Company prompt written notice prior to such disclosure to the extent practicable.  The Company acknowledges that certain of the Investors are in the business of venture capital or private equity investing and therefore review the business plans and related proprietary information of many enterprises, including enterprises that may have products or services that compete directly or indirectly with those of the Company.  Nothing in this Agreement shall preclude or in any way restrict the Investors from investing or participating in any particular enterprise, regardless of whether such enterprise has products or services that compete with those of the Company.  The Company and each Investor acknowledges and agrees that certain of the Investors or their Affiliates may presently have, or may engage in the future in, internal development programs, or may receive information from third parties that relates to, and may develop and commercialize products independently or in cooperation with such third parties, that are similar to or that are directly or indirectly competitive with the Company’s development programs, products or services.  Nothing in this Agreement or any other agreement related to the transactions contemplated by this Agreement shall in any way preclude or restrict such Investors or their Affiliates from conducting any development program, commercializing any product or service or

 

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otherwise engaging in any enterprise, whether or not such development program, product, service or enterprise competes with those of the Company, so long as such activities do not result in a violation of the confidentiality provisions of this Agreement.

 

3.4                               Reservation of Common Stock.  The Company will at all times reserve and keep available, solely for issuance and delivery upon the conversion of the Preferred Stock, all Common Stock issuable from time to time upon such conversion.

 

3.5                               Proprietary Information and Inventions Agreement.  The Company shall require all employees, advisors and consultants of the Company or any of its subsidiaries to execute and deliver a Proprietary Information and Inventions Agreement substantially in a form approved by the Board.

 

3.6                               Employee Vesting.  Unless otherwise approved by the Board, including a majority of the Preferred Directors, all future employees, advisors and consultants of the Company who purchase, receive options to purchase, or receive awards of shares of the Company’s capital stock after the date hereof shall be required to execute restricted stock or option agreements, as applicable, providing for (i) vesting of shares over a four (4) year period, with the first twenty-five percent (25%) of such shares vesting following twelve (12) months of continued employment or service, and the remaining shares vesting in equal monthly installments over the following thirty-six (36) months, and (ii) a one hundred eighty (180) day lockup period in connection with the Initial Offering.  Notwithstanding the foregoing, solely with respect to any equity award or option grant by the Company immediately following the Initial Closing to any employee, advisor or consultant who has been employed with or providing services to the Company for at least one year before the Initial Closing, such equity award or option grant shall not be subject to a one-year cliff.  The Company shall, upon termination of employment of a holder of restricted stock for any reason, have the right to repurchase unvested shares at the lower of cost or the fair market value of such shares at the time of repurchase.

 

3.7                               Matters Requiring Preferred Directors’ Approval.  The Company shall not, without approval of the Board, which approval must include the affirmative vote of a majority of the Preferred Directors or if there is only one Preferred Director, the affirmative vote of such remaining Preferred Director:

 

(a)                                 incur indebtedness in excess of $100,000, individually or in the aggregate,  other than payables incurred in the ordinary course of business;

 

(b)                                 change the principal business of the Company, enter into any material new line of business, or exit the current line of business;

 

(c)                                  enter into or be a party to any transaction with or modify any agreement with any director, officer, or employee of the Company or any “associate” (as defined in Rule 12b-2 promulgated under the Exchange Act) of any such Person, except for transactions contemplated by this Agreement or customary compensation or benefit arrangements that are approved by the Board; or

 

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(d)                                 amend the Company’s 2008 Long Term Incentive Plan, as amended, or approve any new equity incentive plan.

 

3.8                               Directors’ Liability and Indemnification.  The Restated Certificate and the Company’s Bylaws, as amended from time to time (the “Bylaws”), shall provide (a) for elimination of the liability of directors to the maximum extent permitted by law and (b) for indemnification of directors for acts on behalf of the Company to the maximum extent permitted by law.

 

3.9                               Insurance.  The Company shall obtain, as soon as possible after the date hereof, from a financially sound and reputable insurer, directors and officers liability insurance to the maximum extent permitted by law and providing for at least $5,000,000 in coverage, and shall cause such insurance policy to be maintained until such time as the Board, including a majority of the Preferred Directors, determines that such insurance should be discontinued.  The Company shall use commercially reasonable efforts to obtain, as soon as possible after the date hereof, from a financially sound and reputable insurer, term “key-person” life insurance on the Company’s chief executive officer, in the aggregate amount of $1,000,000, and shall cause such insurance policy to be maintained until such time as the Board, including a majority of the Preferred Directors, determines that such insurance should be discontinued.  The key-person policy shall name the Company as loss payee, and neither policy shall be cancelable by the Company without prior approval of the Board, including a majority of the Preferred Directors.

 

3.10                        Successor Indemnification.  If the Company or any of its successors or assignees (i) consolidates with or merges into any other person and is not the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers or conveys all or substantially all of its properties and assets to any person, then, and in each such case, to the extent reasonably necessary, the Company will use commercially reasonable efforts for proper provision to be made so that the successors and assignees of the Company assume the obligations of the Company with respect to indemnification of members of the Board as in effect immediately before such transaction, whether such obligations are contained in the Bylaws, the Restated Certificate or elsewhere, as the case may be.

 

3.11                        Compensation Committee.  The Board will maintain a compensation committee to recommend management compensation and the Company’s benefit plans for approval by the Board and to administer the Company’s equity incentive plans.  The compensation committee shall contain no more than three (3) persons, including the Preferred Directors designated by Sofinnova and NEA, respectively, pursuant to that certain Second Amended and Restated Voting Agreement dated as of the date hereof, by and among the Company, the Investors and certain other parties set forth therein (the “Voting Agreement”).

 

3.12                        Audit Committee.  The Board will maintain an audit committee.  The audit committee shall contain no more than three (3) persons, including the Preferred Director designated by Sofinnova pursuant to the Voting Agreement.

 

3.13                        Meeting of the Board; Board Expenses; Compensation of Directors.  The Board shall meet at least five (5) times each year in accordance with an agreed-upon schedule.  The Company shall reimburse each non-employee director for (i) all reasonable expenses

 

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incurred for services on the Board and (ii) out-of-pocket travel expenses incurred in connection with travel to and from the meetings of the Board.  If any non-employee director receives equity compensation for his or her services as a director of the Company, each other non-employee director shall be entitled to receive the same equity compensation; provided, however, that each such non-employee director shall have the right in his or her discretion to waive receiving such equity compensation.

 

3.14                        Qualifying Investments.  Any future purchases of Company securities by Sofinnova in connection with or upon a registered public offering of the Company shall constitute a qualifying investment, as such term is defined in Rule 203(1)-1 promulgated under the Investment Advisers Act of 1940, as amended.

 

3.15                        Small Business Stock; Real Property Holding Corporation.

 

(a)                                 For so long as any of the shares of Preferred Stock are held by an Investor  (or a transferee in whose hands such shares are eligible to qualify as “Qualified Small Business Stock” as defined in Section 1202(c) of the Internal Revenue Code of 1986, as amended (the “Code”)), the Company will use its reasonable efforts to comply with the reporting and recordkeeping requirements of Section 1202 of the Code, any regulations promulgated thereunder and any similar state laws and regulations.  The Company agrees to submit to any Investor and to the Internal Revenue Service, if necessary, any reports that may be required under Section 1202(d)(1)(c) of the Code and any related Treasury Regulations.  In addition, within ten (10) days after any Investor has delivered to the Company a written request therefor, the Company shall deliver to such Investor a written statement indicating whether Preferred Stock constitutes “Qualified Small Business Stock” as defined in Section 1202(c) of the Code.  The Company’s obligation to furnish a written statement pursuant to this Section 3.15(a) shall continue notwithstanding the fact that a class of the Company’s stock may be traded on an established securities market.

 

(b)                                 The Company shall provide prompt notice to each Investor following any  “determination date” (as defined in Treasury Regulation Section 1.897-2(c)(1)) on which the Company becomes a United States real property holding corporation.  In addition, upon a written request by any Investor, the Company shall provide such Investor with a written statement informing such Investor whether such Investor’s interest in the Company constitutes a United States real property interest.  The Company’s determination shall comply with the requirements of Treasury Regulation Section 1.897-2(h)(1) or any successor regulation, and the Company shall provide timely notice to the Internal Revenue Service, in accordance with and to the extent required by Treasury Regulation Section 1.897-2(h)(2) or any successor regulation, that such statement has been made.  The Company’s written statement shall be delivered to such Investor within ten (10) days of such Investor’s written request therefor.  The Company’s obligation to furnish such written statement pursuant to this Section 3.15(b) shall continue notwithstanding the fact that a class of the Company’s stock may be regularly traded on an established securities market or the fact that there is no preferred stock then outstanding.

 

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3.16                        Certain Covenants Relating to SBA Matters.

 

(a)                                 Compliance.  So long as any Investor which is a licensed Small Business Investment Company (an “SBIC Investor”) holds any securities of the Company, the Company will at all times comply with the non-discrimination requirements of 13 C.F.R.  Parts 112, 113 and 117.

 

(b)                                 Information for SBIC Investor.  Within forty-five (45) days after the end of each fiscal year and at such other times as an SBIC Investor may reasonably request, the Company shall deliver to such SBIC Investor a written assessment, in form and substance satisfactory to such SBIC Investor, of the economic impact of such SBIC Investor’s financing specifying the full-time equivalent jobs created or retained in connection with such investment, and the impact of the financing on the Company’s business in terms of profits and on taxes paid by the Company and its employees.  Upon request, the Company agrees to promptly provide each SBIC Investor with sufficient information to permit such Investor to comply with their obligations under the Small Business Investment Act of 1958, as amended, and the regulations promulgated thereunder and related thereto; provided, however, each SBIC Investor agrees that it will protect any information which the Company labels as confidential to the extent permitted by law.  Any submission of any financial information under this Section shall include a certificate of the Company’s president, chief executive officer, treasurer or chief financial officer.

 

3.17                        Series C Preferred Stock Dividend.  In connection with the Special Dividend (as defined in the Restated Charter), each holder of Series A Preferred Stock and Series B Preferred Stock hereby represents and warrants to the Company and further agrees as follows:  (a) such stockholder has been advised in writing to consult with such attorneys, accountants and other advisors of his, her or its own choice with respect to the Special Dividend; (b) such stockholder has had the opportunity and sufficient time to seek such legal, accounting and other advice; and (c) such stockholder solely shall be responsible for any taxes due by such stockholder as a result of the Special Dividend.  Each holder of Series A Preferred Stock and Series B Preferred Stock will defend and indemnify the Company from and against:  (i) any tax liability actually incurred by the Company that results directly from the failure of such stockholder to pay any taxes due by such stockholder as a result of the Special Dividend and (ii) any and all losses or liabilities, including defense costs, actually incurred by the Company that result directly from such stockholder’s failure to pay any taxes due as a result of the Special Dividend.

 

3.18                        Board Matters.  Each Preferred Director shall be entitled in such person’s discretion to be a member of any committee of the Board of Directors of the Company, unless such committee is comprised solely of disinterested directors and such Preferred Director is not disinterested for such purposes.  If at any time the Company has any subsidiaries, then the board of directors of any subsidiary of the Company shall be comprised of the same members as the Board of Directors of the Company.

 

3.19                        FCPA Compliance.  The Company shall not, and shall not permit any of its subsidiaries and Affiliates or any of its or their respective directors, officers, managers, employees, independent contractors, representatives or agents (collectively, “Representatives”) to, promise, authorize or make any payment to, or otherwise contribute any item of value to, directly or indirectly, any non-U.S. government official, in each case, in violation of the U.S. Foreign Corrupt Practices Act (“FCPA”) or any other applicable anti-bribery or anti-corruption

 

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law.  The Company shall, and shall cause each of its subsidiaries and Affiliates to, cease all of its or their respective activities, as well as remediate any actions taken by the Company, its subsidiaries or Affiliates or any of its or their respective Representatives in violation of the FCPA or any other applicable anti-bribery or anti-corruption law.  The Company shall, and shall cause each of its Affiliates and subsidiaries to, maintain systems or internal controls (including, but not limited to, accounting systems, purchasing systems and billing systems) to ensure compliance with the FCPA or any other applicable anti-bribery or anti-corruption law.

 

3.20                        Termination of Covenants.  All covenants of the Company contained in Section 3 of this Agreement (other than the provisions of Sections 3.3, 3.8, 3.10, 3.14, 3.15, 3.17, and 3.19) shall terminate and be of no further force or effect as to each Investor (a) immediately prior to the consummation of the Qualified IPO (as defined in the Restated Certificate) or (b) when the Company first becomes subject to the periodic reporting requirements of Section 12(g) or 15(d) of the Exchange Act, whichever event occurs first.

 

SECTION 4.                         RIGHTS OF FIRST REFUSAL.

 

4.1                               Subsequent Offerings.  Subject to applicable securities laws, each Investor holding at least 1,900,000 shares (as adjusted for any stock dividends, splits, combinations, recapitalizations and the like) of Series A Preferred Stock, Series B Preferred Stock, Series B-1 Preferred Stock and Series C Preferred Stock (each, a “Major Holder”) shall have a right of first refusal to purchase all or any portion of its pro rata share of all Equity Securities, as defined below, that the Company may, from time to time, propose to sell and issue after the date of this Agreement, other than the Equity Securities excluded by Section 4.6 hereof.  Each Major Holder’s pro rata share is equal to the ratio of (x) the number of shares of the Common Stock (including all shares of Common Stock issuable or issued upon conversion of the Shares) held by such Major Holder immediately prior to the issuance of such Equity Securities to (y) the total number of shares of Common Stock (including all shares of Common Stock issued or issuable upon conversion of the Shares or upon the exercise of any outstanding warrants or options) outstanding immediately prior to the issuance of the Equity Securities.  The term “Equity Securities” shall mean (a) any Common Stock, Preferred Stock or other security of the Company, (b) any security or right convertible into or exercisable or exchangeable for, with or without consideration, any Common Stock, Preferred Stock or other security (including any option to purchase such a convertible security), (c) any security carrying any warrant or right to subscribe to or purchase any Common Stock, Preferred Stock or other security or (d) any such warrant or right.

 

4.2                               Exercise of Rights.  If the Company proposes to issue any Equity Securities, it shall give each Major Holder written notice (the “Offer Notice”) of its intention, describing the Equity Securities, the price and the terms and conditions upon which the Company proposes to issue the same.  Each Major Holder shall have forty-five (45) days after receipt of the Offer Notice to elect to purchase its pro rata share of the Equity Securities for the price and upon the terms and conditions specified in the Offer Notice by giving written notice to the Company and stating therein the quantity of Equity Securities to be purchased.  If not all of the Major Holders elect to purchase their pro rata share of the Equity Securities, then the Company shall promptly notify in writing (the “Overallotment Notice”) the Major Holders who elect to purchase their full pro rata share of the Equity Securities (each a “Fully-Exercising Holder”) of any other Major

 

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Holder’s failure to do likewise and shall offer such Fully-Exercising Holder(s) the right to acquire such unsubscribed shares that the Major Holders were entitled to subscribe for but that were not subscribed for by the Major Holders (the “Overallotment Shares”).  Each Fully-Exercising Holder shall have ten (10) days after receipt of the Overallotment Notice to notify the Company of its election to purchase up to such portion of the Overallotment Shares as is equal to the ratio of (x) the number of shares of the Common Stock (including all shares of Common Stock issuable or issued upon conversion of the Shares) held by such Fully-Exercising Holder immediately prior to the issuance of such Equity Securities to (y) the total number of shares of Common Stock (including all shares of Common Stock issued or issuable upon conversion of the Shares or upon the exercise of any outstanding warrants or options) held by all Fully-Exercising Holders immediately prior to the issuance of the Equity Securities.  The closing of any sale pursuant to this Section 4.2 shall occur within sixty (60) days after the date that the Offer Notice is received by the Major Holders.

 

4.3                               Issuance of Equity Securities to Other Persons.  To the extent that the Major Holders fail to exercise in full the rights of first refusal pursuant to Section 4.2 with respect to the Equity Securities being offered by the Company, the Company shall have thirty (30) days after the expiration of the of the periods provided in Section 4.2 to sell the Equity Securities in respect of which the Major Holders’ rights were not exercised, at a price and upon general terms and conditions no more favorable to the purchasers thereof than specified in the Offer Notice pursuant to Section 4.2 hereof.  If the Company has not sold such Equity Securities within such thirty (30) day period, the Company shall not thereafter issue or sell any Equity Securities without first offering such securities to the Major Holders in the manner provided above.

 

4.4                               Termination and Waiver of Rights of First Refusal.  The rights of first refusal set forth in this Section 4 shall not apply to, and shall terminate immediately prior to the Qualified IPO.  The rights of first refusal established by this Section 4 may be amended, or any provision waived with the written consent of the Required Holders pursuant to Section 5.5.

 

4.5                               Transfer of Rights of First Refusal.  The rights of first refusal of each Holder under this Section 4 may be transferred to the same parties as set forth in Section 2.9, subject to the same restrictions as any transfer of registration rights pursuant to Section 2.9.

 

4.6                               Excluded Securities.  The rights of first refusal set forth in this Section 4 shall have no application to the Exempted Securities (as defined in the Restated Certificate).

 

SECTION 5.                         MISCELLANEOUS.

 

5.1                               Governing Law; Jurisdiction.  This Agreement shall be governed by and construed under the laws of the State of Delaware in all respects as such laws are applied to agreements among Delaware residents entered into and performed entirely within Delaware.  The parties agree that any action brought by any party under or in relation to this Agreement, including, without limitation, to interpret or enforce any provision of this Agreement, may be brought in, and each party agrees to and does hereby submit to the jurisdiction and venue of the state courts of the State of California and the State of Texas and to the jurisdiction of the United States District Court for the Northern District of California and the United States District Court for the Western District of Texas—Austin Division.  Each party hereby waives, and agrees not to

 

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assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.

 

5.2                               Successors and Assigns.  Except as otherwise expressly provided herein, the provisions hereof shall inure to the benefit of, and be binding upon, the parties hereto and their respective successors, assigns, heirs, executors, and administrators and shall inure to the benefit of and be enforceable by each person who shall be a holder of Registrable Securities from time to time; provided, however, that any attempted Transfer of the rights of a Holder or Investor pursuant to this Agreement or pursuant to the Right of First Refusal Agreement that does not comply with the applicable provisions of the Right of First Refusal Agreement and Sections 2.9 and 4.5 of this Agreement and shall be void ab initio and shall not confer any rights on the purported transferee or assignee, and the Company may deem and treat the person listed as the holder of such shares in its records as the absolute owner and holder of such shares for all purposes, including the payment of dividends or any redemption price and voting or exercising the rights of a Holder or Investor pursuant to this Agreement or the Right of First Refusal Agreement.  The rights of any Investor under this Agreement may be assigned, in whole or in part, to any Affiliate of such Investor in connection with a transfer of the related Registrable Securities by such Investor to such Affiliate.

 

5.3                               Entire Agreement.  This Agreement and the Exhibits and Schedules hereto constitute the full and entire understanding and agreement between the parties with regard to the subjects hereof and no party shall be liable or bound to any other in any manner by any oral or written representations, warranties, covenants and agreements except as specifically set forth herein.  Each party expressly represents and warrants that it is not relying on any oral or written representations, warranties, covenants or agreements outside of this Agreement.

 

5.4                               Severability.  In the event one or more of the provisions of this Agreement should, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein.

 

5.5                               Amendment and Waiver.

 

(a)                                 Except as otherwise expressly provided herein, this Agreement may be amended, modified or terminated and observance of any provision of this Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the Required Holders.  Notwithstanding the foregoing, this Agreement may not be amended, modified or terminated and the observance of any term hereof may not be waived with respect to any Investor without the written consent of such Investor if such amendment, modification, termination or waiver materially and adversely affects such Investor in a different manner than the other Investors (it being agreed that a waiver of the provisions of Section 4 with respect to a transaction shall not be deemed to materially and adversely affect any Major Holder in a different manner than the other Major Holders if such

 

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Major Holder will not be able to purchase all or any portion of its pro rata share of Equity Securities if such waiver does so by its terms, notwithstanding the fact that certain Major Holders may nonetheless by agreement with the Company, purchase Equity Securities in such transaction).  Any amendment, modification, termination or waiver effected in accordance with this Section 5.5 shall be binding upon the Company, each of the other parties hereto and any successor or permitted assignee of any such party whether or not such party, successor or assignee entered into or approved such amendment, modification or waiver.

 

(b)                                 For the purposes of determining the number of Holders or Investors entitled to vote or exercise any rights hereunder, the Company shall be entitled to rely solely on the list of record holders of its stock as maintained by or on behalf of the Company.

 

5.6                               Delays or Omissions.  It is agreed that no delay or omission to exercise any right, power, or remedy accruing to any party, upon any breach, default or noncompliance by another party under this Agreement shall impair any such right, power, or remedy, nor shall it be construed to be a waiver of any such breach, default or noncompliance, or any acquiescence therein, or of any similar breach, default or noncompliance thereafter occurring.  It is further agreed that any waiver, permit, consent, or approval of any kind or character on any party’s part of any breach, default or noncompliance under this Agreement or any waiver on such party’s part of any provisions or conditions of this Agreement must be in writing and shall be effective only to the extent specifically set forth in such writing.  All remedies, either under this Agreement, by law, or otherwise afforded to any party, shall be cumulative and not alternative.

 

5.7                               Notices.  All notices required or permitted hereunder shall be in writing and shall be deemed effectively given:  (a) upon personal delivery to the party to be notified, (b) when sent by confirmed electronic mail or facsimile if sent during normal business hours of the recipient; if not, then on the next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) day after deposit with a nationally recognized overnight courier, specifying next day delivery, with written verification of receipt.  All communications shall be sent (x) to the Company at the address as set forth on the signature page hereof, with a copy to Vinson & Elkins L.L.P., Terrace 7, 2801 Via Fortuna, Suite 100, Austin, Texas  78746, Attention:  William R. Volk, (512) 236-3450 (fax), and (y) to any other party to be notified at the address as set forth on the signature pages hereof or Exhibit A hereto (and in the case of notice to Sofinnova, with a copy, which shall not constitute notice, to O’Melveny & Myers LLP, 2765 Sand Hill Road, Menlo Park, CA  94025, Attention:  Brian Covotta, (650) 473-2601 (fax)) or at such other address or electronic mail address as such party may designate by ten (10) days advance written notice to the other parties hereto.

 

5.8                               Attorneys’ Fees.  In the event that any suit or action is instituted under or in relation to this Agreement, including, without limitation, to enforce any provision in this Agreement, the prevailing party in such dispute shall be entitled to recover from the losing party all fees, costs and expenses of enforcing any right of such prevailing party under or with respect to this Agreement, including, without limitation, such reasonable fees and expenses of attorneys and accountants, which shall include, without limitation, all fees, costs and expenses of appeals.

 

5.9                               Titles and Subtitles.  The titles of the sections and subsections of this Agreement are for convenience of reference only and are not to be considered in construing this Agreement.

 

26



 

5.10                        Additional Investors.  Notwithstanding anything to the contrary contained herein, if the Company shall issue additional shares of Preferred Stock after the date hereof, any purchaser of such shares of Preferred Stock may become a party to this Agreement by executing and delivering an additional counterpart signature page to this Agreement and shall be deemed an “Investor,” a “Holder” and a party hereunder.  Notwithstanding anything to the contrary contained herein, each stockholder of Asuragen, Inc., a Delaware corporation (“Asuragen”), who received Registrable Securities in connection with the distribution by Asuragen of the Equity Securities held by Asuragen on December 31, 2009 automatically, and without any further action on the part of the Company, Asuragen, such stockholder or any other person, became a party to this Agreement and shall be deemed an “Investor,” a “Holder” and a party hereunder, and shall be bound by this Agreement to the same extent as if such stockholder had joined in the execution and delivery of this Agreement.

 

5.11                        Counterparts.  This Agreement may be executed in two or more counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

 

5.12                        Aggregation of Stock.  All shares of Preferred Stock or Registrable Securities held or acquired by affiliated entities or persons or persons or entities under common management or control shall be aggregated together for the purpose of determining the availability of any rights under this Agreement.

 

5.13                        Pronouns.  All pronouns contained herein, and any variations thereof, shall be deemed to refer to the masculine, feminine or neutral, singular or plural, as to the identity of the parties hereto may require.

 

5.14                        Prior Agreement.  The Company and the Investors party to the Prior Agreement (which parties hold the requisite percentages to amend the Prior Agreement by written consent) hereby amend and restate the Prior Agreement in its entirety and the Prior Agreement shall automatically terminate and be no further force or effect.

 

[THIS SPACE INTENTIONALLY LEFT BLANK]

 

27



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

COMPANY:

 

 

 

MIRNA THERAPEUTICS, INC.

 

 

 

By:

/s/ Lynn Hohlfeld

 

Name:

Lynn Hohlfeld

 

Title:

Chief Financial Officer

 

 

 

Address:

2150 Woodward Street, Suite 100

 

 

Austin, Texas 78744

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

SOFINNOVA VENTURE PARTNERS VIII, L.P.

 

 

 

By:

Sofinnova Management VIII, L.L.C.,

 

 

its General Partner

 

 

 

By:

/s/ Michael F. Powell

 

Name:

Michael F. Powell

 

Title:

Managing Member

 

 

 

Address:

2800 Sand Hill Road, Suite 150

 

 

Menlo Park, CA 94025

 


 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTORS:

 

 

 

NEW ENTERPRISE ASSOCIATES 14, L.P.

 

 

 

By:

NEA Partners 14, L.P., its general partner

 

By:

NEA 14 GP, LTD, its general partner

 

 

 

 

By:

/s/ Louis S. Citron

 

Name:

Louis S. Citron

 

Title:

Chief Legal officer

 

 

 

Address:

1954 Greenspring Drive., Suite 600

 

 

Timonium, MD 21093

 

 

 

NEA VENTURES 2012, LIMITED PARTNERSHIP

 

 

 

 

 

By:

/s/ Louis S. Citron

 

Name:

Louis S. Citron

 

Title:

Vice President

 

 

 

Address:

1954 Greenspring Drive., Suite 600

 

 

Timonium, MD 21093

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

PFIZER INC.

 

 

 

By:

/s/ Barbara Dalton

 

Name:

Barbara Dalton

 

Title:

VP Venture Capital

 

 

Worldwide Business Development

 

 

 

Address:

235 East 42nd Street

 

 

New York, NY 10017

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

OSAGE UNIVERSITY PARTNERSHIP I, L.P.

 

 

 

By:

Osage University GP, LP, its general partner

 

By:

Osage Partners, LLC, general partner

 

 

 

 

By:

/s/ William Harrington

 

Name:

William Harrington

 

Title:

Member

 

 

 

 

Address:

Osage Management Co., L.P.

 

 

50 Monument Road

 

 

Suite 201

 

 

Bala Cynwyd, PA 19004

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

CORRELATION VENTURES, L.P.

 

As nominee for Correlation Ventures L.P.,

 

Correlation Ventures Executives Fund, L.P.

 

 

 

By:

Carrel — Ventures GP, LLC

 

 

 

 

By:

/s/ David E. Coats

 

Name:

David E. Coats

 

Title:

Managing Member

 

 

 

 

Address:

9255 Towne Center Drive, Suite 350

 

 

San Diego, CA 92121

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof,

 

 

 

INVESTOR:

 

 

 

/s/ Matthew Winkler

 

Matthew Winkler

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

/s/ Neile P Wolfe

 

Neile P. Wolfe

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

DANIEL WINKLER 2000 TRUST

 

 

 

By:

/s/ Mary Beth Bigger

 

Name

Mary Beth Bigger

 

Title:

Trustee

 

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

JOHN WINKLER 2000 TRUST

 

 

 

By:

/s/ Mary Beth Bigger

 

Name:

Mary Beth Bigger

 

Title:

Trustee

 

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

JOSHUA WINKLER 2000 TRUST

 

 

 

By:

/s/ Mary Beth Bigger

 

Name:

Mary Beth Bigger

 

Title:

Trustee

 

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

/s/ Roland Carlson

 

Roland Carlson

 

 

 

Address:        [Address]

 


 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

/s/ John E. Mooney

 

John E. Mooney

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

/s/ Robert E. Maxson, Jr.

 

Robert E. Maxson, Jr

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

/s/ William Bennett

 

William Bennett

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

/s/ John D. Hershey

 

John D. Hershey

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the that paragraph hereof

 

 

 

INVESTOR:

 

 

 

/s/ David W. Sargent

 

David W. Sargent

 

 

 

Address:        [Address]

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

THE STATE OF TEXAS

 

 

 

By:

/s/ Jeffrey S. Boyd

 

Name:

Jeffrey S. Boyd

 

Title:

Chief of Staff, Office of the Governor

 

 

 

Address:

Financial Services

 

 

ETF Compliance

 

 

PO Box 12878

 

 

Austin, TX 78711-2878

 

 

 

 

 

with a concurrent copy to:

 

 

 

 

 

ATTN: Emerging Technology Fund

 

 

Award Program

 

 

General Counsel

 

 

Office of the Governor

 

 

P.O. Box 12428

 

 

Austin, Texas 78711

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

PTV SCIENCES II, L.P.

 

 

 

By:

Pinto Technology Ventures GP, L.P.,

 

 

its general partner

 

 

 

 

By:

Pinto TV GP Company LLC,

 

 

its general partner

 

 

 

 

 

 

 

By:

/s/ Evans S. Melrose, M.D.

 

Name:

Evan S. Melrose, M.D.

 

Title:

Authorized Person

 

 

 

Address:

 



 

IN WITNESS WHEREOF, the parties hereto have executed this SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

/s/ Christopher Earl

 

Christopher Earl

 

 

 

Address:        [Address]

 



 

EXHIBIT A

 

SCHEDULE OF INVESTORS

 

Series C Investors

 

Sofinnova Venture Partners VIII, L.P.
New Enterprise Associates 14, L.P.
NEA Ventures 2012, Limited Partnership
Pfizer Inc.
Osage University Partners I, L.P.
Correlation Ventures, L.P.
Bennett, William
Carlson, Rolland
Hershey, John D.
Maxson Jr., Robert E.
Mooney, John E.
Sargent, David W.
Winkler, Matthew
Wolfe, Neile P.
Daniel Winkler 2000 Trust
John Winkler 2000 Trust
Joshua Winkler 2000 Trust

 

Series B-1 Investors

 

The Office of Governor Economic Development and Tourism of the State of Texas

 

Series B Investors

 

Bennett, William
Carlson, Rolland
Finch, Michele
Hershey, John and Panda
Hershey, John D.
Maxson Jr., Robert E.
Smitheal, Jeremy
The Steinhardt/Alderton 2005 Revocable Living Trust
Winkler, Matthew

 

Series A Investors

 

Ann S. Bowers Separate Property Trust
Asuragen, Inc.
Bennett, William
Blackstone Holdings III, LP Quebec SEC
BPEF 2 Ambion Partners, LP
Brown, David



 

Carlson, Rolland
Dahler, John
Dan Hill and Associates Money Purchase Pension Plan
Earl, Christopher D.
Glassmeyer, Penelope M.
Growth Capital Partners, L.P.
Hajim, Edmund A.
Haverford Florida, LLC
High Plains Investments, LLP
Hime, John A.
Hippocrates Partners, L.P.
HOC Investments, LLC
Hollister, Rachelle
Hunicke-Smith, Scott
Innovative Promotions LLC
Investment Fund, LP
Jacobs, Melvin
James F. Clark, Limited Partner
Jean Calhoun QPRT Trust
Kaderli, Mark D.
Karcher, John D.
Labourier, Emmanuel
Leander, Bruce W.
Lim, Su-min
Lone Juniper, LP (Lone Pine Capital)
Mailer, James L.
Martinez, Noel
Mary P. Adams Family Trust
Maxson Jr., Robert E.
McNabb II, John T.
Miller, Craig
Mont Blanc Holdings, LLC
Mooney, John E.
Moses, Bianca
Moss, Donell
Neufeld, Todd
OKAY Investment Club
The Osterweis Revocable Trust U/A dated 9/13/93
Pasloske, Brittan
Peter Rauenbuehler and Mary L. Mines Trust
The Karen Winkler Phillips Family Trust UTD 3/19/2004
PTV Sciences II, LP
Rebello, James
Robert Calhoun QPRT Trust
RogHen I Limited Partnership

Rutman, James Morgan

 



 

Sargent, David W.

Schmaltz, Richard R.

Shelton, Jeffrey and Elizabeth

Sluder, Greenfield

The Steinhardt/Alderton 2005 Revocable Living Trust

Stenzel, Tim

Sullivan, Gregory W.

Suryaputra, Ivonne

TekkiShodan Limited Partnership

Telegraph Hill Partners SBIC, L.P.

Telegraph Hill Partners, L.P.

The Michele Finch Living Trust

The Michael K. Wilson Revocable Trust

THP Affiliates Fund, LLC

Thornburgh, Richard E.

Vallejo, Ramiro R.

Von Rumohr, Cai

Walkerpeach, Cindy

Weiss, Dr. Arnold-Peter C.

Williams, Jeffrey

Winkler, Matthew

Daniel Winkler 2000 Trust

John Winkler 2000 Trust

Joshua Winkler 2000 Trust

Wolfe, Neile P.

Wyper, George U.

Wyper Partners, LLC

Zdeblick, Dr. Thomas A. and Catherine D.

 


 

MIRNA THERAPEUTICS, INC.

 

AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED

INVESTOR RIGHTS AGREEMENT

 

THIS AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this “Amendment”) is entered into as of this 21st day of March, 2014, and amends that certain Second Amended and Restated Investor Rights Agreement (the “Agreement”), by and among MIRNA THERAPEUTICS, INC., a Delaware corporation (the “Company”), and each of the persons and entities listed on Exhibit A thereto (the “Investors” and each individually an “Investor”). Capitalized terms used herein but not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.

 

RECITALS

 

WHEREAS, the Company and the undersigned Investors desire to amend the Agreement to provide clarification to the definition of the term “Required Holders” with respect to any potential ambiguity that may arise under the existing definition in the event the shares of Preferred Stock convert into shares of Common Stock in connection with an Initial Offering;

 

WHEREAS, pursuant to Section 5.5 of the Agreement, the Agreement may be amended, modified or terminated and observance of any provision of the Agreement may be waived (either generally or in a particular instance and either retroactively or prospectively) only with the written consent of the Company and the Required Holders;

 

WHEREAS, any amendment, modification, termination or waiver effected in accordance with Section 5.5 of the Agreement shall be binding upon the Company, each of the other parties to the Agreement and any successor or permitted assignee of any such party whether or not such party, successor or assignee entered into or approved such amendment, modification or waiver; and

 

WHEREAS, the undersigned Investors constitute the Required Holders under the Agreement.

 

NOW, THEREFORE, in consideration of these premises and for other good and valid consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the undersigned Required Holders hereby agree that the Agreement shall be amended as follows:

 

AGREEMENT

 

Section 1.                                          Amendment to Section 1.  Section 1(q) of the Agreement is hereby amended and restated in its entirety to read as follows:

 

(q)                           Required Holders” means the Investors holding at least a majority of the then outstanding shares of Common Stock issued or issuable upon the conversion of the Preferred Stock.”

 

1



 

Section 2.                                          Effect of this Amendment.  This Amendment shall form a part of the Agreement for all purposes, and each party thereto and hereto shall be bound hereby.  From and after the execution of this Amendment by the parties hereto, any reference to the Agreement shall be deemed a reference to the Agreement as amended hereby.  This Amendment shall be deemed to be in full force and effect from and after the execution of this Amendment by the parties hereto.  Except as specifically amended as set forth herein, each term and condition of the Agreement shall continue in full force and effect.

 

Section 3.                                          Governing Law.  This Amendment shall be governed by and construed under the laws of the State of Delaware in all respects as such laws are applied to agreements among Delaware residents entered into and performed entirely within Delaware.

 

Section 4.                                          Counterparts; Electronic and Facsimile Signatures.  This Amendment may be executed in any number of counterparts, each of which when so executed and delivered will be deemed an original, and all of which together shall constitute one and the same agreement.  This Amendment may be executed and delivered electronically (including by transmission of .pdf files) and by facsimile and, upon such delivery, such signatures will be deemed to have the same effect as if the original signature had been delivered to the other party.

 

[THIS SPACE INTENTIONALLY LEFT BLANK]

 

2



 

IN WITNESS WHEREOF, the parties hereto have executed this AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

COMPANY:

 

 

 

MIRNA THERAPEUTICS, INC.

 

 

 

By:

/s/ Paul Lammers

 

Name:

Paul Lammers, M.D., M.Sc.

 

Title:

President and Chief Executive Officer

 



 

IN WITNESS WHEREOF, the parties hereto have executed this AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

 

SOFINNOVA VENTURE PARTNERS VIII, L.P.

 

 

 

 

By:

Sofinnova Management VIII, L.L.C.,

 

 

its General Partner

 

 

 

 

By:

/s/ Mike Powell

 

Name:

Mike Powell

 

Title:

 

 



 

IN WITNESS WHEREOF, the parties hereto have executed this AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTORS:

 

 

 

 

 

NEW ENTERPRISE ASSOCIATES 14, L.P.

 

 

 

 

 

By:

NEA Partners 14, L.P., its general partner

 

By:

NEA 14 GP, LTD, its general partner

 

 

 

By:

/s/ Louis S. Citron

 

Name:

Louis S. Citron

 

Title:

Chief Legal Officer

 

 

 

 

 

 

NEA VENTURES 2012, LIMITED PARTNERSHIP

 

 

 

 

 

 

 

By:

/s/ Louis S. Citron

 

Name:

Louis S. Citron

 

Title:

Vice-President

 



 

IN WITNESS WHEREOF, the parties hereto have executed this AMENDMENT NO. 1 TO SECOND AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

 

 

 

INVESTOR:

 

 

 

PFIZER INC.

 

 

 

By:

/s/ Barbara Dalton

 

Name:

Barbara Dalton

 

Title:

VP, Venture Capital

 




Exhibit 10.2(A)

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 

CROSS LICENSE AGREEMENT

 

This Cross License Agreement (this “Agreement”) is made as of the Effective Date (as such term is defined below) by and between Asuragen, Inc., a Delaware corporation with its principal offices at 2150 Woodward St., Austin, Texas 78744 (“Asuragen”) and Mirna Therapeutics, Inc., a Delaware corporation with an office at 2150 Woodward Street, Austin, Texas 78744 (“Mirna”); (each of Asuragen and Mirna is referred to herein as “Party” and together as the “Parties”).

 

RECITALS

 

WHEREAS, pursuant to an Asset Contribution Agreement (the “Contribution Agreement”) between Asuragen and Mirna which agreement closed on the Effective Date, Asuragen contributed the assets and liabilities of its therapeutics division (collectively, the “Therapeutics Business”) to Mirna (the “Contribution”);

 

WHEREAS, Asuragen and Mirna each own or control certain patent rights and other intellectual property rights as part of their respective businesses;

 

WHEREAS, the Parties each wish to establish their respective rights and obligations with respect to specified patent rights and other intellectual property rights of the other;

 

NOW, THEREFORE, in consideration of these premises and the mutual covenants and agreements set forth herein, the sufficiency of which is hereby acknowledged, the Parties agree as follows:

 

AGREEMENT

 

1.                                      DEFINITIONS

 

In addition to other terms defined elsewhere herein, the following terms and expressions, as used in this Agreement, shall have the meanings indicated:

 

1.1.                            Affiliate” of a Party shall mean any corporation or other entity that is directly or indirectly controlling, controlled by or under common control with such Party.  For the purpose of this definition, “control” shall mean the direct or indirect ownership of more than fifty percent (50%) of the shares of the subject entity entitled to vote in the election of directors (or, in the case of an entity that is not a corporation, for the election of the corresponding managing authority), or more than fifty percent (50%) interest in the income of such entity.

 

1.2.                            Ancillary Agreements” shall mean the following agreements between the Parties entered into as of the Effective Date:  this Agreement, [***], Services Agreement, [***].

 

1.3.                            Effective Date” shall mean the date of the closing of the Asset Contribution Agreement.

 



 

1.4.                            Controlled” shall mean, with respect to any item of technology or the related IP thereto, the possession of the right, whether directly or indirectly, and whether by ownership, license or otherwise, to disclose, deliver, assign, or grant a license, sublicense or other right to or under such applicable technology or related IP, of the scope and as provided for herein, without any of the following:  (i) violating the terms of any agreement or other arrangement with any Third Party existing as or the Effective Date; or (ii) violating any law, regulation, rule, code, order or other requirement of any federal, state, foreign, local, or other government body or the need for any additional permits, payments, authorizations, or approvals under any such law, regulation, rule, code, order or requirement.

 

1.5.                            Therapeutics” shall mean the field of therapeutics.

 

1.6.                            Disclosures” shall mean the technical disclosures, together with any accompanying documents and materials, described in Exhibit C.

 

1.7.                            Diagnostics” shall mean the field of diagnostics.

 

1.8.                            Intellectual Property” or “IP” shall mean and includes all apparatus, assay components, biological materials, cell lines, clinical data, chemical compositions or structures, databases and data collections, diagrams, formulae, inventions (whether or not patentable), know-how, methods, processes, proprietary information, protocols, schematics, specifications, software, software code (in any form including source code and executable or object code), techniques, works of authorship, and other forms of technology (whether or not embodied in any tangible form and including all tangible embodiments of the foregoing such as instruction manuals, laboratory notebooks, prototypes, samples, studies, and summaries), together with any and all Patent Rights, trade secret rights, copyrights and other intellectual property rights in each of the foregoing.

 

1.9.                            Inventions” shall mean inventions, discoveries, improvements, processes, formulae, data, works, know-how and other information, patentable or otherwise, that are conceived solely by one or more employees of a Party or jointly by one or more employees of a Party with one or more employees of the other Party, regardless of whether within the scope of any of the Ancillary Agreements or otherwise.

 

1.10.                     Joint Invention IP” shall mean all Intellectual Property in and to any Joint Invention (defined in Section 2.2) owned or Controlled jointly by the Parties.

 

1.11.                     Licensed Method” shall mean a method that but for the particular license being granted would infringe or misappropriate the Intellectual Property being licensed.  For clarity, the definition of Licensed Methods varies and is limited according to the particular Intellectual Property being licensed on a grant-by-grant basis.  A Licensed Method under one particular license grant set forth in Article 3 shall not be read to encompass Licensed Methods licensed under a different license grant in such Article 3.

 

1.12.                     Licensed Product” shall mean a product or service that but for the particular license being granted would infringe or misappropriate the Intellectual Property being licensed.  For clarity, the definition of Licensed Products varies and is limited according to the particular Intellectual Property being licensed on a grant-by-grant basis.  A Licensed Product under one

 



 

particular license grant set forth in Article 3 herein shall not be read to encompass Licensed Products licensed under a different license grant in such Article 3.

 

1.13.                     Mirna Existing IP” shall mean all Intellectual Property, set forth in Exhibit A owned or Controlled by Mirna immediately following the completion of the Contribution Agreement and acquired by Mirna through the completion of the Contribution.

 

1.14.                     Patent Rights” shall mean the issued patents and pending patent applications in any country, including, but not limited to, all provisional applications, substitutions, continuations, continuations-in-part, divisionals, and renewals, all letters patent granted thereon, and all reissues, reexaminations and extensions thereof and all patents and patent applications claiming priority therefrom.

 

1.15.                     Mirna Developed IP” shall mean all IP owned or Controlled by Mirna after the Effective Date other than Mirna Existing IP.

 

1.16.                     Asuragen Licensed IP” shall mean the IP described in Exhibit B.

 

1.17.                     Asuragen Developed IP” shall mean all IP owned or Controlled by Asuragen after the Effective Date other than Asuragen Licensed IP.

 

1.18.                     Third Party” shall mean any party or entity other than Asuragen or Asuragen or an Affiliate of either of them.

 

1.19.                     Valid Claim” shall mean a claim of an issued and unexpired patent, which has not been held unenforceable, unpatentable or invalid by a court or other governmental agency of competent jurisdiction, and which has not been admitted to be invalid or unenforceable through reissue, disclaimer or otherwise.

 

2.                                      INTELLECTUAL PROPERTY OWNERSHIP

 

2.1.                            Existing Intellectual Property.  The Parties acknowledge and agree that upon the closing of the Asset Contribution Agreement, Mirna shall be the exclusive owner of all right, title and interest in and to the Mirna Existing IP subject to the license granted herein to Asuragen.  The Parties further acknowledge and agree that Asuragen shall be the exclusive owner of all right, title and interest in and to the Asuragen Existing IP subject to the licenses granted herein to Mirna.

 

2.2.                            Post-Effective Date Intellectual Property.  Subject to the express licenses granted by either Party to the other Party pursuant to this Agreement and except as otherwise described in the Collaboration Agreement, the entire right, title and interest in and to any and all Inventions conceived:  (a) solely by employees or consultants of Asuragen shall be owned solely by Asuragen and be deemed Asuragen Developed IP; (b) solely by employees or consultants of Mirna shall be owned solely by Mirna and be deemed Mirna Developed IP; and (c) jointly by employees or consultants of Asuragen and employees or consultants of Mirna (each a “Joint Invention”) shall be [***].  If there is a dispute regarding whether or not a Joint Invention is [***], the Parties agree that a senior executives from each Party shall meet to attempt to resolve

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

the dispute.  If, however, the Parties’ senior executives are unable to resolve the dispute within [***], the Parties agree to [***].  The Parties agree that [***].

 

Any [***] and shall be subject to the obligations set forth in this Agreement.  Any [***] and shall be subject to the obligations set forth in this Agreement.

 

Each Party shall cause its employees and consultants to, make a full disclosure of any and all Inventions, and promptly upon such disclosure, and in no event later than [***] days thereafter, shall provide to the other Party a copy of any disclosure that consists of a Joint Invention.  Each Party also agrees to execute any documents necessary to perfect the other Party’s rights in a Joint Invention.

 

2.3.                            Invention Disclosures.  Mirna shall own the Disclosure and all IP therein shall revert to Mirna and all IP therein shall be deemed Mirna Existing IP for all purposes.

 

3.                                      LICENSE GRANTS

 

3.1.                            Asuragen License Grant to Mirna.  Asuragen hereby grants to Mirna under the Asuragen Licensed IP a fully paid-up, royalty-free, perpetual, irrevocable worldwide, fully sublicensable and non-transferable (except in accordance with Section 12.5), exclusive (even as to Asuragen) right and license within the field of Therapeutics to make, have made, use, sell, offer to sell, distribute, have distributed, import, market and otherwise exploit Licensed Products and practice Licensed Methods.  Mirna may also use the Asuragen Licensed IP for its internal research efforts.

 

3.2.                            Mirna License Grant to Asuragen under Mirna Existing IP.  Mirna hereby grants to Asuragen, under the Mirna Existing IP a fully paid-up, royalty-free, perpetual, irrevocable, worldwide, fully sublicensable and non-transferable (except in accordance with Section 12.5), exclusive (even as to Mirna) right and license within the field of Diagnostics to make, have made, use, sell, offer to sell, distribute, have distributed, import, market and otherwise exploit Licensed Products and to practice the Licensed Methods.  Asuragen may also use the Mirna IP for its internal research efforts.

 

3.3.                            Rights of Affiliates.  Either Party may extend the right and license granted to it under Section 3.1, 3.2 or 3.3, as the case may be, to such Party’s Affiliates.

 

3.4.                            Access to Existing Know-how.  For a period of [***] after the Effective Date, upon reasonable request, each Party shall provide or otherwise make available to the other Party [***], in its possession and in existence immediately after the Effective Date (the “Existing Know-How”).  Each Party and its Affiliates, licensees and sublicensees may use such Existing Know-How subject to the licenses set forth in Sections 3.1 and 3.2 as reasonably required to exercise such Party’s rights thereunder.  Any such disclosed Existing Know-How shall be subject at all times to the confidentiality obligations of Article 11 (Proprietary Information).

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

4.                                      CERTAIN COVENANTS AND RESTRICTIONS

 

4.1.                            Employee Solicitation.  Each of Asuragen and Mirna hereby agrees it will not directly or indirectly solicit, offer employment to, or employ any employee of the other Party, [***] after the Effective Date, provided; however, that such restriction shall not apply to:

 

(a)                                 [***];

 

(b)                                 [***], with the prior written consent of the other Party; or

 

(c)                                  [***], with the prior written consent of the terminating Party, such consent not to be unreasonably withheld.

 

4.2.                            Websites.  For a [***] commencing on the Effective Date, Asuragen shall provide [***], in a manner to be mutually agreed upon by the Parties.  At Mirna’s request, Asuragen shall provide [***], in a manner to be mutually agreed upon by the Parties.

 

5.                                      REPRESENTATIONS AND WARRANTIES

 

5.1.                            Representations and Warranties of the Parties.  Each Party represents and warrants to the other Party that (a) each has the full power and authority to enter into this Agreement and to perform its obligations hereunder; (b) each has the requisite right and authority to enter into this Agreement and grant the rights and licenses hereunder, without the need for any license, release, consent, approval or other immunity not yet obtained or issued; and (c) each has not previously granted and will not grant any right or license in any the Patent Rights in Mirna Existing IP, Asuragen Licensed IP, the Yale IP (as applicable) that are inconsistent with the rights and licenses granted herein.

 

5.2.                            Disclaimer.  EXCEPT AS EXPRESSLY PROVIDED FOR IN THIS AGREEMENT, NEITHER PARTY MAKES, AND EACH PARTY HEREBY DISCLAIMS, ANY AND ALL REPRESENTATIONS OR WARRANTIES OF ANY KIND, EXPRESS OR IMPLIED, WITH RESPECT TO THE SUBJECT MATTER OF THIS AGREEMENT, INCLUDING WITHOUT LIMITATION WARRANTIES OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE.

 

6.                                      INDEMNIFICATION

 

6.1.                            Indemnification by Asuragen.  Asuragen shall defend, indemnify and hold harmless Asuragen and its Affiliates, sublicensees and distributors and each of their respective officers, directors, shareholders, employees, agents, successors and assigns from and against all claims, demands, causes of action, suits or proceedings by a Third Party (“Claims”), to the extent arising out of (a) a breach by Asuragen of any of its representations, warranties, covenants or agreements under this Agreement, or (b) the manufacture, use, handling, storage, marketing, sale, distribution or other disposition of the any product or service pursuant to the licenses granted herein by Asuragen.  Asuragen shall pay any and all damages, liabilities, losses, settlements, costs (including, without limitation, reasonable attorneys’ fees and costs), awarded by a court as a result of such Claim.  Asuragen’s foregoing obligation to indemnify, defend and hold harmless shall not apply to such portion of any Claims arising or resulting from:  (i) a

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

breach or nonfulfillment of any representation, warranty or covenant of (A) the Company (as defined in the Merger Agreement) set forth in the Merger Agreement; or (B) Asuragen (or any of the other indemnified parties above) set forth in any of the Ancillary Agreements; or (ii) any gross negligence or willful misconduct of Asuragen (or any of the other indemnified parties set forth in this Section 7.1) or of the Company (as defined in the Merger Agreement).  Except as provided in the preceding sentence, the foregoing obligation to indemnify, defend and hold harmless shall be in addition to, and not diminish in any way, Asuragen’s indemnification obligations pursuant to the other Ancillary Agreements.

 

6.2.                            Indemnification by Mirna.  Mirna shall defend, indemnify and hold harmless Asuragen and its Affiliates, sublicensees and distributors and each of their respective officers, directors, shareholders, employees, agents, successors and assigns from and against all Claims, to the extent arising out of (a) a breach by Asuragen of any of its representations, warranties, covenants or agreements under this Agreement, or (b) the manufacture, use, handling, storage, marketing, sale, distribution or other disposition of any product or service pursuant to the licenses granted herein by Asuragen, its Affiliates, agents or sublicensees.  Mirna shall pay any and all damages, liabilities, losses, settlements, costs (including, without limitation, reasonable attorneys’ fees and costs), awarded by a court as a result of such Claim.  Asuragen’s foregoing obligation to indemnify, defend and hold harmless shall not apply to such portion of any Claims arising or resulting from:  (i) a breach or nonfulfillment of any representation, warranty or covenant of (A) the Parent (as defined in the Merger Agreement) set forth in the Merger Agreement; or (B) Asuragen (or any of the other indemnified parties set forth in Section 7.2 above) set forth in any of the Ancillary Agreements; or (ii) any gross negligence or willful misconduct of Asuragen (or any of the other indemnified parties set forth in this Section 7.2) or of the Parent (as defined in the Merger Agreement).  Except as provided in the preceding sentence, the foregoing obligation to indemnify, defend and hold harmless shall be in addition to, and not diminish in any way, Asuragen’s indemnification obligations pursuant to the other Ancillary Agreements, nor the indemnification obligations set forth in Article X of the Merger Agreement.

 

6.3.                            Notice and Procedure.  The indemnified Party shall provide indemnifying Party prompt written notice of any such Claim.  The indemnifying Party shall have right to control the defense and settlement of such Claim; provided that (a) the indemnifying Party shall not settle any such Claim without the prior written consent of the indemnified Party, which consent will not be unreasonably withheld or delayed and (b) the indemnified Party may, at its option and expense, participate in connection with the defense and settlement of any such Claim.  The indemnified Party shall provide, at the indemnifying Party’s request and expense, reasonable cooperation in defending or settling any such Claim.

 

7.                                      LIMITATION ON LIABILITY

 

EXCEPT FOR INDEMNIFICATION OBLIGATIONS SET FORTH IN SECTION 7, IN NO EVENT SHALL EITHER PARTY BY LIABLE TO THE OTHER FOR ANY INDIRECT, SPECIAL, INCIDENTAL, OR CONSEQUENTIAL DAMAGES OF ANY KIND, INCLUDING, BUT NOT LIMITED TO, LOSS OF BUSINESS, LOSS OF USE, LOSS OF PROFITS, OR INTERRUPTION OF BUSINESS, ARISING FROM OR RELATING TO THIS AGREEMENT OR THE SUBJECT MATTER HEREOF, INCLUDING THE BREACH

 



 

HEREOF, EVEN IF SUCH PARTY HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES, HOWEVER, CAUSED.

 

8.                                      PROSECUTION AND MAINTENANCE

 

8.1.                            Prosecution and Maintenance.  Asuragen shall have the first right, but not the obligation, to maintain all patents within Asuragen Licensed IP and to prosecute and maintain any patent applications relating thereto.  Mirna shall have the first right, but not the obligation, to maintain all patents within Mirna Existing IP and to prosecute and maintain any patent applications relating thereto.  Each Party shall reasonably cooperate and assist the other Party in connection with any prosecution and maintenance activities under this Section 9.1, including for any Joint Invention.  The Party responsible for prosecution shall provide the other Party all material documentation and correspondence from, sent to or filed with patent offices regarding the Patent Rights and with a reasonable opportunity to review and comment upon all filings with such patent offices in advance.  The costs associated with such prosecution and maintenance activities shall be borne exclusively by the Party responsible for prosecution except where the Parties have agreed to collaborate in which event, the costs shall be divided equally between the Parties.

 

8.2.                            Abandoned Patents.  In the event that the Party that owns a given issued patent or a given patent application wherein such patent or patent application was in existence prior to the Effective Date and is subject to this Agreement, elects not to continue prosecution of such patent application, or elects not to maintain such issued patent (such patents and applications being “Abandoned Patents”), the owning Party shall promptly and on a timely basis, and at least [***] before any deadline for response, submission or other action, notify the other Party thereof and the other Party shall have the right, but not the obligation, at its option, to prosecute and maintain such Abandoned Patents, at such other Party’s sole expense.  The abandoning Party [***].  The abandoning Party shall reasonably cooperate with and assist the other Party in connection with any prosecution and maintenance activities undertaken by the other Party.

 

9.                                      INFRINGEMENT AND ENFORCEMENT

 

9.1.                            Infringement Claims by Third Parties.  With respect to any and all Claims instituted by Third Parties against Asuragen or Asuragen or any of their respective Affiliates for infringement or misappropriation of such Third Parties’ intellectual property rights involving the manufacture, use, license, marketing, sale, offer for sale or importation of a product or service that is the subject of a license granted hereunder (each, an “Infringement Claim”), Asuragen and Asuragen will assist one another and cooperate (at the cost of the defending Party) in the defense and settlement of such Infringement Claims at the other Party’s reasonable request.  Notwithstanding any other provision of this Article 10, neither Party shall make any settlements of any suit, proceeding or action relating to any infringement of such Infringement Claim that would adversely affect the other Party or adversely affect the rights and licenses granted hereunder, without first obtaining such other Party’s prior written consent, such consent not to be unreasonably withheld or delayed.

 

9.2.                            Enforcement Against Third Parties.  Absent written agreement of the Parties to the contrary, the Party [***] shall have the sole and exclusive right (in its sole discretion) but not

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

the obligation to initiate and maintain legal action at such Party’s sole expense against any such infringing Third Party.  The Party enforcing such Intellectual Property rights shall [***] and shall have [***].

 

9.3.                            Cooperation.  In any suit, proceeding or dispute involving infringement or misappropriation by a Third Party of Intellectual Property licensed hereunder, a Party shall promptly notify the other Party when it becomes aware of any such infringement, and each Party shall provide the other with reasonable cooperation and assistance, including agreeing to be named as a party to such action and, upon the request and the expense of the enforcing Party, the other Party shall make available, at reasonable times and under appropriate conditions, all relevant personnel, records, papers, information, samples, specimens and the like in its possession.

 

10.                               PROPRIETARY INFORMATION

 

10.1.                     Definition.  “Proprietary Information” means all information and material disclosed by one Party (“Disclosing Party”) to the other Party (“Receiving Party”) that is designated, at or before the time of disclosure, as proprietary or confidential, or provided under circumstances reasonably indicating that the information or material is proprietary or confidential.  In particular, “Proprietary Information” of each Party is deemed to include all apparatus, assay components, biological materials, cell lines, clinical data, chemical compositions or structures, databases and data collections, diagrams, formulae, inventions (whether or not patentable), know-how, methods, processes, proprietary information, protocols, schematics, specifications, software, software code (in any form including source code and executable or object code), techniques, works of authorship, and other forms of technology (whether or not embodied in any tangible form and including all tangible embodiments of the foregoing such as instruction manuals, laboratory notebooks, prototypes, samples, studies, and summaries), including without limitation, any information pertaining to any Invention.

 

10.2.                     Confidentiality of Proprietary Information.  Except as otherwise provided in this Agreement.  Receiving Party agrees to (a) retain in confidence the Proprietary Information of the Disclosing Party, (b) restrict the use of and access to the Proprietary Information of the Disclosing Party to employees of Receiving Party and its Affiliates to whom disclosure is necessary to exercise the rights and licenses granted in this Agreement, (c) appropriately bind each employee to whom any such disclosure is made to hold the Proprietary Information of the Disclosing Party in confidence, and (d) not sell, lease, assign, transfer or otherwise disclose the Proprietary Information of the Disclosing Party to any Third Party, except Affiliates, in accordance with this Section 11.2.  Notwithstanding the foregoing, either Party may disclose Proprietary Information of the Disclosing Party (i) to agents or consultants of such Party and its Affiliates under the terms and conditions of a written, signed confidential disclosure agreement with terms and conditions that prohibit disclosure to other parties and that are otherwise at least as restrictive as the terms of subsections (a) through (d) of this Section 11.2, and (ii) to distributors, licensees, customers, clients, business partners and other third parties to the extent necessary to exercise the rights and licenses with respect to Proprietary Information granted hereunder.  Without limiting the foregoing, each Party agrees that it shall treat the Proprietary Information of the Disclosing Party with at least the same degree of care as it would its own highly proprietary information, but in no event less that a reasonable degree of care.

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

10.3.                     Confidentiality of Agreement.  Neither Party shall disclose the terms and conditions or existence of this Agreement without the prior written consent of the other Party, except as may be required by law or regulation.  If a Party determines that disclosure is required by law or regulation, it shall consult with the other Party to minimize such disclosure.

 

10.4.                     Exclusions.  Neither Party shall have any obligation under this Agreement with respect to Proprietary Information that (a) is now, or hereafter becomes, through no act or failure to act on the part of the Receiving Party, generally known or available; (b) is or was known by the Receiving Party at or before the time such information or material was received from the Disclosing Party, as evidenced by the Receiving Party’s tangible (including written or electronic) records; (c) is furnished to the Receiving Party by a Third Party that is not under an obligation of confidentiality to the Disclosing Party with respect to such information or material; (d) is independently developed by the Receiving Party without any breach of this Agreement, as evidenced by the Receiving Party’s contemporaneous tangible (including written or electronic) records; or (e) is required to be disclosed pursuant to any judicial or governmental request, requirement or order, provided that upon receipt of such request, requirement or order, the Receiving Party shall give the Disclosing Party prompt notice and take all reasonable steps to assist the Disclosing Party in seeking a protective order and shall limit the disclosure to the minimum extent necessary to comply with such request, requirement or order.

 

10.5.                     Injunctive Relief.  Each Party acknowledges and agrees that, in the event of an unauthorized use, reproduction, distribution or disclosure of any Proprietary Information, an adequate remedy at law would not be available and, therefore, injunctive or other equitable relief would be appropriate to restrain such use, reproduction, distribution or disclosure, whether threatened or actual.

 

11.                               GENERAL

 

11.1.                     Term.  This Agreement shall be irrevocable and remain in force and effect in perpetuity.  Notwithstanding the foregoing, any royalty-bearing licenses under Patent Rights shall only remain in force until the last claim of the Patent(s) being licensed expire or until a final decree of invalidity thereof from which no appeal or other judicial recourse can be, or is, taken of the last remaining Patent(s) being licensed.

 

11.2.                     Notices.  All notices and other communications under this Agreement shall be in writing and shall be deemed given when delivered by hand or upon confirmed receipt of a facsimile transmission, two (2) days after being deposited with an overnight courier, or five (5) days after mailing, postage prepaid, by register or certified mail, return receipt requested, to the below address or such other addresses as either Party shall specify in a written notice to the other.

 

To Asuragen:

 

To Mirna:

Asuragen, Inc.

 

Mirna Therapeutics, Inc.

2150 Woodward Street, Suite 100

 

2150 Woodward Street, Suite 100

Austin, Texas, 78744

 

Austin, Texas, 78744

Fax: 512-681-5201

 

Fax: 512-681-5201

Attn: General Counsel

 

Attn: General Counsel

 



 

11.3.                     Governing Law; Jurisdiction.  This Agreement shall be governed by and construed in accordance with the laws of the United States of America (to the extent federal law is applicable) and the laws of the State of Delaware (to the extent state law is applicable) without giving effect to the choice of law principles thereof.  Any dispute arising out of this Agreement shall be subject to the exclusive jurisdiction and venue of the Delaware state courts of New Castle County, Delaware, (or, if there is exclusive federal jurisdiction, the United States District Court for the District of Delaware) and the Parties consent to the personal and exclusive jurisdiction and venue of these courts.

 

11.4.                     Relationship of Parties.  Nothing contained in this Agreement shall be deemed or construed as creating a joint venture, partnership, agency, employment or fiduciary relationship between the Parties.  Neither Party nor its agents have any authority of any kind to bind the other Party in any respect whatsoever, and the relationship of the Parties is, and at all times shall continue to be, that of independent contractors.

 

11.5.                     Assignment.  This Agreement may not he assigned by either Party without the prior written consent of the other Party, which consent shall not be unreasonably withheld or delayed.  Such consent shall not be required for any assignment to a party that succeeds to all or substantially all of the assigning Party’s business or assets relating to this Agreement (whether by sale, merger, operation of law or otherwise), provided that such assignee agrees in writing to be bound by the terms and conditions of this Agreement.  This Agreement shall be binding upon and shall inure to the benefit of the Parties and their respective successors and permitted assigns.

 

11.6.                     Further Assurances.  Each Party agrees to take or cause to be taken such further actions, and to execute, deliver and file or cause to be executed, delivered and filed such further documents and instruments, and to obtain such consents, as may be reasonably required or requested in order to effectuate fully the purposes, terms and conditions of this Agreement.

 

11.7.                     Waiver.  A waiver, express or implied, by either Party of any right under this Agreement or of any failure to perform or breach hereof by the other Party hereto shall not constitute or be deemed to be a waiver of any other right hereunder or of any other failure to perform or breach hereof by such other Party, whether of a similar or dissimilar nature thereto.

 

11.8.                     Severability.  If any provision of this Agreement is unenforceable or invalid under any applicable law or is so held by applicable court decision, such unenforceability or invalidity will not render this Agreement unenforceable or invalid as a whole, and, in such event, such provision will be changed and interpreted so as to best accomplish the objectives of the Parties within the limits of applicable law or applicable court decision.

 

11.9.                     Force Majeure.  In the event either Party hereto is prevented from or delayed in the performance of any of its obligations hereunder by reason of acts of God, war, strikes, riots, storms, fires, or any other cause whatsoever beyond the reasonable control of the Party, the Party so prevented or delayed shall be excused from the performance of any such obligation to the extent and during the period of such prevention or delay.

 



 

11.10.              Captions and Headings.  The captions and headings used in this Agreement are inserted for convenience only, do not form a part of this Agreement, and shall not be used in any way to construe or interpret this Agreement.

 

11.11.              Construction.  This Agreement has been negotiated by the Parties and shall be interpreted fairly in accordance with its terms and without any construction in favor of or against either Party.

 

11.12.              Counterparts.  This Agreement may be executed in one or more counterparts (including, without limitation, by fax), with the same effect as if the Parties had signed the same document.  Each counterpart so executed shall be deemed to be an original, and all such counterparts shall be construed together and shall constitute one and the same instrument.

 

11.13.              Entire Agreement; Amendment.  This Agreement constitutes the entire understanding and only agreement between the Parties with respect to the subject matter hereof and supersedes any and all prior or contemporaneous negotiations, representations, agreements, and understandings, written or oral, that the Parties may have reached with respect to the subject matter hereof other than the Ancillary Agreements.  No agreements altering or supplementing the terms hereof may be made except by means of a written document signed by the duly authorized representatives of each of the Parties hereto.

 



 

IN WITNESS WHEREOF, the Parties hereto have caused their duly authorized representatives to execute this Agreement as of the Effective Date.

 

 

Mirna Theraeputics, Inc.

 

Asuragen, Inc.

 

 

 

 

 

 

By:

/s/ Lynne Hohlfeld

 

By:

/s/ Rolland D. Carlson

 

 

 

 

 

Name:

 Lynne Hohlfeld

 

Name:

Rollie Carlson, Ph.D.

 

 

 

 

 

Title:

CFO

 

Title:

President

 



 

EXHIBIT A

 

MIRNA EXISTING IP

 

Atty Docket

 

 

 

Appln No. and Date

 

Publn No. and

No.

 

Title

 

Filed

 

Date Published

[***]

 

[***]

 

[***]

 

[***]

 

[***] 7 pages in this document have been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

EXHIBIT B

 

ASURAGEN LICENSED IP

 

 

 

 

 

Appln No. and Date

 

Publn No. and

Atty Docket No.

 

Title

 

Filed

 

Date Published

[***]

 

[***]

 

[***]

 

[***]

 

[***] 4 pages in this document have been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 




Exhibit 10.2(B)

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 

FIRST AMENDMENT TO THE CROSS LICENSE AGREEMENT

 

This First Amendment to the Cross License Agreement (the “First Amendment”) is by and between Mirna Therapeutics, Inc. (“Mirna”), a Delaware corporation with a principal business address at 2150 Woodward St., Suite 100, Austin, Texas 78744, and Asuragen, Inc., a Delaware corporation, with a principal business address at 2150 Woodward Street, Austin, Texas 78744 (“Asuragen”), and is effective as of September 28, 2012 (the “First Amendment Effective Date”).  All capitalized terms not defined in this First Amendment shall have the meanings given to them in the Cross License Agreement (including Exhibits thereto) entered into by and between Mirna and Asuragen, effective as of November 3, 2009 (the “Agreement”).

 

Whereas, the Asuragen Licensed IP includes the ASUR:009US and ASUR:009WO patent families;

 

Whereas, the Agreement stipulates that Asuragen controls all prosecution and enforcement of the ASUR:009US and ASUR:009WO patent families; and

 

Whereas, the Parties desire that Mirna control all prosecution and enforcement of the ASUR:009US and ASUR:009WO patent families.

 

NOW THEREFORE, in consideration of these premises and the mutual covenants and agreements set forth herein, the sufficiency of which is hereby acknowledged, the Parties agree as follows:

 

1.                                      The following definitions shall be added to the Agreement:

 

1.20.                     “009 Family” means the Asuragen Licensed IP ASUR:009US and ASUR:009WO patent family as set forth in Exhibit B of the Agreement and Exhibit A of this First Amendment and any divisionals, continuations, reexaminations, reissues, and foreign equivalents.

 

2.                                      The following section shall be added to Section 8:

 

8.3                               Prosecution of the 009 Family.  Notwithstanding the foregoing Sections 8.1 and 8.2, Mirna shall have the first right, but not the obligation, to maintain all patents within the 009 Family and to prosecute and maintain any patent applications relating thereto.  Mirna shall provide Asuragen all material documentation and correspondence from, sent to or filed with patent offices regarding the 009 Family and with a reasonable opportunity to review and comment upon all filings with such patent offices in advance.  The costs associated with such prosecution and maintenance activities shall be borne exclusively by Mirna.  In the event that Mirna elects not to continue prosecution of any 009 Family patent applications or elects not to maintain an issued patent from the 009 Family (the “009 Abandoned Patents”), Mirna will promptly and on a timely basis, and at least [***] before any deadline, for response, submission or other action, notify Asuragen thereof and Asuragen shall have the right but not the obligation, at its option, to prosecute and maintain such 009 Abandoned Patents at Asuragen’s sole expense.  Mirna shall reasonably cooperate with Asuragen and assist Asuragen in connection with the

 



 

prosecution and maintenance activities of any 009 Abandoned Patents, and Mirna shall have no further rights with regard to such 009 Abandoned Patents.

 

3.                                      The following sentence shall be added after the last sentence of Section 9.2:

 

Notwithstanding the foregoing, Mirna shall have the sole and exclusive right (in its sole discretion) but not the obligation to initiate and maintain legal action at Mirna’s sole expense against any Third Party infringing the any of the Intellectual Property rights of the 009 Family.  Mirna shall [***].

 

4.                                      The first sentence of Section 9.1 shall be deleted and replaced with the following:

 

“9.1                         Infringement Claims by Third Parties.  With respect to any and all Claims instituted by Third Parties against Asuragen or Mirna or any of their respective Affiliates for infringement or misappropriation of such Third Parties’ intellectual property rights involving the manufacture, use, license, marketing, sale, offer for sale or importation of a product or service that is the subject of a license granted hereunder (each, an “Infringement Claim”), Asuragen and Mirna will assist one another and cooperate (at the cost of the defending Party) in the defense and settlement of such infringement Claims at the other Party’s reasonable request.

 

5.                                      Except as specifically modified or amended hereby, all terms of the Agreement shall remain in full force and effect.  No provision of this First Amendment may be modified or amended except expressly by a written amendment of this document signed by the Parties.  This First Amendment shall be governed in accordance with Paragraph 11.3 of the Agreement.

 

In Witness Whereof, the Parties hereto have caused their duly authorized representatives to execute this Agreement as of the Effective Date.

 

 

ASURAGEN, INC.

 

 

MIRNA THERAPEUTICS, INC.

 

 

 

By:

/s/ Rolland D. Carlson, Ph.D.

 

By:

/s/ Paul Lammers, M.Sc., M.D.

 

 

 

 

 

Name:

Rolland D. Carlson, Ph.D.

 

Name:

Paul Lammers, M.Sc., M.D.

Title:

President/COO

 

Title:

CEO and President

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

Exhibit A
009 Family

 

[***]

 

[***]

 

[***]

 

[***]

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 




Exhibit 10.3(A)

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 

LICENSE AGREEMENT

 

THIS LICENSE AGREEMENT (the “Agreement”) is made and entered into effective as of December 22, 2011 (the “Effective Date”) by and between MIRNA THERAPEUTICS, INC., a Delaware corporation with a place of business at 2150 Woodward Street, Suite 100, Austin, Texas 78744 (“MirnaRx”), and MARINA BIOTECH, INC., a Delaware corporation with a place of business at 3830 Monte Villa Parkway, Bothell, Washington 98021 USA (“Marina Bio”).  Marina Bio and MirnaRx are sometimes referred to herein individually as a “Party”, and collectively as the “Parties.”

 

RECITALS

 

WHEREAS, Marina Bio owns or controls certain patent rights and know-how relating to its proprietary oligonucleotide delivery technology that may be useful for delivery of microRNA sequences for use treating certain cancers and other diseases or conditions; and

 

WHEREAS, MirnaRx has capabilities in the research and development of microRNA drug candidates and products and desires to obtain from Marina Bio, and Marina Bio is willing to grant to MirnaRx, a license under Marina Bio’s technology and intellectual property relating to Marina Bio’s liposomal delivery technology known as NOV340, to exclusively develop and commercialize drug products containing such delivery technology combined with one or more selected MirnaRx mircoRNA molecules worldwide, on the terms and conditions set forth herein;

 

NOW, THEREFORE, based on the premises and the mutual covenants and obligations set forth below, and intending to be bound hereby, the Parties agree as follows:

 

ARTICLE 1

 

DEFINITIONS

 

For purposes of this Agreement, the following terms shall have the meanings as set forth below:

 

1.1                               Additional Indication” means, with respect to a particular Licensed Product, an indication for treating or preventing a human disease or condition that is the subject of and covered by a unique NDA application and Regulatory Approval, different from and subsequent to the original Regulatory Approval for such Licensed Product.

 

1.2                               Affiliate” means, with respect to a particular Party, an entity that, directly or indirectly, through one or more intermediaries, controls, is controlled by or is under common control with such Party.  For purposes of this definition, the term “control” (with correlative meanings for the terms “controlled by” and “under common control with”) means that the applicable entity has the actual power, direct or indirect, to direct and to cause the direction of the management and policies of the applicable other entity, whether through ownership of fifty percent (50%) or more of the voting securities of such other entity, by contract or otherwise.  An

 



 

entity will be an Affiliate for purposes of this Agreement only so long as it satisfies the definition set forth above in this Section.

 

1.3                               Applicable Law” means all applicable laws, rules, ordinances, and regulations, including any rules, regulations, guidelines or other requirements of relevant government agencies, that may be in effect from time to time in the applicable country or jurisdiction, applicable to the specific activities being undertaken pursuant to this Agreement.

 

1.4                               Available” means, with respect to a particular MirnaRx Compound for which MirnaRx submits a notice under Section 2.6, that at the time of such notice Marina Bio is not bound by an agreement with a Third Party that grants such Third Party exclusive license rights under the Licensed Technology with respect to such MirnaRx Compound.

 

1.5                               Bankrupt Party” shall have the meaning ascribed to such term in Section 10.2(b).

 

1.6                               Claim” means any claim, allegation, suit, complaint, action or legal proceeding.

 

1.7                               Commercialize” or “Commercialization” means those activities comprising or relating to the manufacturing, promotion, marketing, advertising, distribution and sale of Licensed Products, including Phase IV Trials or equivalent clinical trials conducted following Regulatory Approval as needed or useful to promote and market the Licensed Product and/or maintain such Regulatory Approval.

 

1.8                               Commercially Reasonable Efforts” means, with respect to particular tasks or activities hereunder in developing or Commercialization Licensed Product, a level of efforts applied to such tasks or activities reasonably consistent with the efforts commonly used by similarly-situated companies in the pharmaceutical industry to conduct such activities on products at a similar (as compared to the Licensed Product at the applicable time) stage in its product life and of similar market potential, profit potential and strategic value resulting from its own research efforts, based on information and conditions then-prevailing, including, without limitation, efficacy of the product, the competitiveness of alternative products in the marketplace, the patent and other proprietary position of the product, the likelihood of regulatory approval given the regulatory structure involved and the likelihood of adequate reimbursement.  Commercially Reasonable Efforts shall be determined on a country-by-country or market-by-market basis (as most applicable) for a particular Licensed Product, and it is anticipated that the level of effort will change over time reflecting changes in the status of the Licensed Product and the country (or markets) involved.

 

1.9                               Confidential Information” of a Party means all confidential or proprietary information received or otherwise obtained by the other Party from such Party or its Affiliates pursuant to this Agreement, other than that portion of such information that:

 

(a)                                 is now, or hereafter becomes, generally available to the public through no fault of the receiving Party, or its Affiliates, or any entity that obtained such information or materials from the receiving Party;

 



 

(b)                                 the receiving Party or its Affiliates already possesses, as evidenced by its written records, prior to receipt thereof from the disclosing Party;

 

(c)                                  is obtained without restriction from a Third Party that had the legal right to disclose the same to the receiving Party or its Affiliates; or

 

(d)                                 has been independently developed by the receiving Party or its Affiliates without the aid, application or use of any Confidential Information of the disclosing Party, as demonstrated by competent written proof.

 

1.10                        Confidentiality Agreement” shall mean that certain Confidential Disclosure Agreement dated November 25, 2011, among Marina Bio, MirnaRx and Asuragen, Inc.

 

1.11                        Cumulative Sublicense Fees” shall have the meaning ascribed to such term in Section 5.6.

 

1.12                        Default” shall mean a failure by a Party to perform one or more of its material obligations under this Agreement which, if not cured within the applicable cure period set forth in Section 10.2(c) or (d), is likely to cause material harm to the other Party.

 

1.13                        Dispute” shall have the meaning ascribed to such term in Section 11.1.

 

1.14                        Field of Use” means any use of Licensed Product for or relating to the prophylaxis, treatment or palliation of cancer or any other disease or health condition in humans or animals, but excluding any DNAi human therapeutic use.

 

1.15                        Field Infringement” shall have the meaning ascribed to such term in Section 6.4.

 

1.16                        Financial Event” shall have the meaning ascribed to that term in Section 10.2(b).

 

1.17                        First Commercial Sale” means, with respect to a particular country, the first commercial sale of a Licensed Product by MirnaRx, its Affiliates or Sublicensees to a Third Party in a country, after all needed Regulatory Approvals for the Licensed Product have been granted in such country.

 

1.18                        GAAP” means generally accepted accounting principles.

 

1.19                        Generic Product” means, with respect to a Licensed Product, a generic product containing the applicable Selected MirnaRx Compound in a formulation similar to and substitutable for such Licensed Product.

 

1.20                        Improvement Patent Claim” means any claim in a patent application filed by MirnaRx (or in any patent issuing on any such application) that:  (i) claims any improvements, modifications or enhancements to the Licensed Technology invented by MirnaRx prior to the date [***] after the Effective Date in conducting manufacturing process development and scale-up with respect to the Licensed Technology under this Agreement, and (ii) cannot be

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

practiced without infringing the Licensed Patents, and including for clarity applicable claims in continuing patent applications (such as continuations, divisions, or continuations-in-part) or in any reissue, re-examined or extended patent.  For clarity, the term “Improvement Patent Claims” expressly excludes:  (x) any claims in patent applications or patents covering inventions made by or on behalf of MirnaRx (or its Affiliate) prior to the Effective Date without use of any Confidential Information or materials of Marina Bio, and (y) any claims in patent applications or patents covering inventions made by or on behalf of MirnaRx (or its Affiliate) after the Effective Date but independent of work done under this Agreement, in each case without use of any Confidential Information or materials of Marina Bio.

 

1.21                        IND” means an Investigational New Drug application, as defined in 21 C.F.R. 312 or any successor regulation or comparable application in accordance with the Regulatory Authority in the applicable jurisdiction.

 

1.22                        Indemnified Party” shall have the meaning ascribed to it in Section 8.3.

 

1.23                        Indemnifying Party” shall have the meaning ascribed to it in Section 8.3.

 

1.24                        Information” means any and all data, results, improvements, processes, methods, protocols, formulas, inventions, know-how, trade secrets and any other information, patentable or otherwise, which may include (but is not limited to) scientific, research and development, manufacturing know-how, pre-clinical, clinical, regulatory, manufacturing, safety, marketing, financial and commercial information or data.

 

1.25                        Licensed Know-How” means any and all proprietary Information owned or controlled by Marina Bio (or its Affiliate) that relates directly to the use or practice of the Licensed Patents and/or is otherwise necessary to develop, make, use or sell Licensed Product.

 

1.26                        Licensed Patent” means:

 

(a)                                 The patents and patent applications that are owned or controlled by Marina Bio or its Affiliate that claim or cover the Marina Bio Technology (including the manufacture or use thereof), including those patents and patent applications listed in Appendix A of this Agreement;

 

(b)                                 all additional patent applications based on or relating to the patents and applications set forth in subclause (a) above;

 

(c)                                  any and all patent applications that are continuing applications (including continuations, continuations-in-part or divisionals, or any foreign equivalents thereof) of the patents and applications described in (a) or (b) above;

 

(d)                                 any and all issued and unexpired patents resulting from any of the applications described in (a), (b) or (c) above;

 

(e)                                  any and all issued and unexpired reissues, reexaminations, renewals, extensions (and any foreign equivalents of any of the foregoing) of any of the patents described in (a), (c) or (d) above; and

 



 

(f)                                   any and all supplemental protection certificates (and any foreign equivalents thereof) applicable to products that, prior to the expiration of any patents listed on Appendix A or any patents included in the scope of (d) above, were covered by one or more Valid Claims of such patents.

 

1.27                        Licensed Product” means a pharmaceutical composition developed or sold by MirnaRx (or its Affiliate or Sublicensee) that contains a Selected MirnaRx Compound and Marina Bio Technology and is claimed or covered by the Licensed Patents, and including any improvements, enhancements or modifications to such composition.

 

1.28                        Licensed Technology” means the Licensed Patents and Licensed Know-How.

 

1.29                        Losses” means costs and expenses (including, without limitation, reasonable legal expenses and attorneys’ fees), judgments, liabilities, fines, damages, assessments and/or other losses.

 

1.30                        Major Market” means [***].  For clarity, obtaining Regulatory Approval of Licensed Product from [***], shall be deemed to be obtaining a Regulatory Approval in a Major Market for purposes of the applicable provisions of this Agreement.

 

1.31                        Manufacturing Processes” means all Information that is Controlled by Marina Bio or its Affiliates and is used to manufacture the delivery formulation in the Marina Bio Technology.

 

1.32                        Marina Bio Indemnitees” shall have the meaning ascribed. to such term in Section 8.2.

 

1.33                        Marina Bio Technology” means Marina Bio’s proprietary NOV340 formulation referred to generally as SMARTICLES® liposomal delivery technology and including any Technology Improvements.

 

1.34                        Milestone Payment Sum” shall have the meaning ascribed to such term in Section 5.6.

 

1.35                        miRNA Compound” means a product containing, comprised of or based on a native or chemically modified RNA oligomer designed to either provide the function of a miRNA and/or modulate a miRNA., where miRNA is understood to be a naturally occurring short RNA molecule found in eukaryotic cells.

 

1.36                        MirnaRx Compound” means any miRNA Compound that is researched or developed by MirnaRx (or its Affiliate) for use in the Field of Use.

 

1.37                        MirnaRx Indemnitees” shall have the meaning ascribed to such term in Section 8.1.

 

1.38                        NDA” means a New Drug Application, as defined in 21 C.F.R. 314, and any other appropriate application or registration submitted to the appropriate Regulatory Authority in

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

a particular country in the Territory to seek Regulatory Approval for sale of Licensed Product in such country.

 

1.39                        Net Sales” means, with respect to a certain time period, all revenues recognized, and deductions applied, in accordance with GAAP consistently applied, based on invoices for the sales of Licensed Products sold by MirnaRx or its Affiliate to Third Parties (but not including sales relating to transactions between MirnaRx, its Affiliates and/or its respective Sublicensees and agents) during such time period, less the total of the following estimated and/or incurred charges or expenses with respect to such sales:  (a) [***]; (b) [***]; (c) [***]; (d) [***]; (e) [***]; (f) [***]; and (g) [***].

 

Any disposal of Licensed Products for, or use of Licensed Products in, clinical or pre-Clinical trials, given as free samples, including, without limitation, sample cards, or distributed for indigent programs shall not be included in Net Sales.

 

Upon any sale or other disposal of any Licensed Product that should be included within Net Sales for any consideration other than an exclusively monetary consideration on bona fide arm’s-length terms, then for purposes of calculating the Net Sales under this Agreement, [***].

 

1.40                        Option Compound” means any of the MirnaRx Compounds on the list in the Side Letter (not to exceed [***] compounds, but subject to the substitution rights in Section 2.6), or, for any such MirnaRx Compound, any other MirnaRx Compound that has at least [***]% sequence homology with such compound.

 

1.41                        Phase IV Trial” means a clinical trial of a pharmaceutical product initiated in a country in an approved indication after receipt of Regulatory Approval for such product in such indication in such country, intended to delineate additional information about such product’s risks, benefits and/or optimal use.

 

1.42                        Prosecution” shall have the meaning ascribed to such term in Section 6.3,

 

1.43                        Regulatory Approval” means all approvals (including supplements, amendments, pre- and post-approvals and price approvals), licenses, registrations or authorizations of any national, supra-national, regional, state or local regulatory agency, department, bureau, commission, council or other governmental entity, necessary for the distribution, use or sale of a Licensed Product in the applicable country or regulatory jurisdiction.

 

1.44                        Regulatory Authority” means any regulatory agency, department, bureau, commission, council or other governmental entity involved in granting approvals, registrations or licenses for the development, manufacturing, marketing, reimbursement, and/or pricing of a Licensed Product in a particular country or regulatory jurisdiction.

 

1.45                        Regulatory Documents” means all regulatory documents and filings, correspondence with Regulatory Authorities, annual reports and amendments thereto related to a Licensed Product.

 

1.46                        Royalty Term” means, as to a particular Licensed Product sold in a country, the period from the date of First Commercial Sale of such Licensed Product in such country until the

 

[***] Certain information in this document has been omitted and filed separately with the Securities and Exchange Commission.  Confidential treatment has been requested with respect to the omitted portions.

 



 

later of:  (i) the date of expiration of the last to expire patent included in the Licensed Patents having a Valid Claim that claims the Licensed Product in such country, or (ii) [***] after such First Commercial Sale of the Licensed Product in. such country.

 

1.47                        Royalties Report” shall have the meaning ascribed to such term in Section 5.7.

 

1.48                        Selected MirnaRx Compound” means:  (a) the MirnaRx Compound known as miR-34 (the sequence of which is set forth in the Side Letter); or (b) any other MirnaRx Compound that MirnaRx selects, as provided in Section 2.6, to combine with the Marina Bio Technology and to develop (or have developed) as a Licensed Product, and including, for any such Selected MirnaRx Compound, any other MirnaRx Compound that has at least [***]% sequence homology with such Selected MirnaRx Compound.

 

1.49                        Side Letter” means that certain letter agreement between the Parties dated as of the Effective Date.

 

1.50                        Sublicensee” means a sublicensee, direct or indirect, of MirnaRx under MirnaRx’s rights pursuant to Section 2.1.

 

1.51                        Sublicense Fees” shall have the meaning as ascribed to such term in Section 5.6.

 

1.52                        Sublicensing Revenues” means all consideration received by MirnaRx (or its Affiliate) from a Sublicensee in consideration of the grant of a sublicense under the Licensed Patents to such Sublicensee (which may include upfront fees, milestone payments, royalties and other similar fees), but excluding:  (a) any amounts paid as reimbursement of research or development costs and expenses incurred by MirnaRx or its Affiliate (including past and ongoing costs and expenses) relating to Licensed Product; (b) direct reimbursement of patent prosecution or enforcement costs; (c) payments of a share of amounts recovered in enforcing patent or other intellectual property rights (except to the extent such share is calculated or treated as royalties under the terms of such sublicense); (d) transfer price payments for sale of compounds or products ([***] of actual fully-burdened cost of goods; (e) bona fide loans on commercial terms; and (f) any payments made to purchase equity in MirnaRx or a MirnaRx Affiliate at fair market value.

 

1.53                        Technology Improvement” means any improvements, enhancements or modifications to the Marina Bio Technology created solely. by Marina Bio within [***] of the Effective Date of the Agreement and which are not created pursuant to any agreement between Marina Bio and a Third Party, but excluding agreements with a contract research organization or consultant (or similar organization) that is contracted to improve the technology on behalf of Marina Bio and where Marina Bio owns or has exclusive license rights to the improvements made under such agreement.

 

1.54                        Term” means the term of this Agreement as set forth in Section 10.1.

 

1.55                        Territory” means the entire world.

 

1.56                        Third Party” means any entity or person other than Marina Bio or MirnaRx or an Affiliate of either of them.