EXHIBIT 10.19
LENDINGCLUB CORPORATION
SERIES B PREFERRED STOCK PURCHASE AGREEMENT
This Series B Preferred Stock Purchase Agreement (the “Agreement”) is made and
entered into as of March 13, 2009, by and among LendingClub Corporation, a
Delaware corporation (the “Company”), and each of those persons and entities,
severally and not jointly, whose names are set forth on the Schedule of
Purchasers attached hereto as Exhibit A (which persons and entities are
hereinafter collectively referred to as “Purchasers” and each individually as a
“Purchaser”).
Recitals
Whereas, the Company has authorized the sale and issuance of an aggregate of
Sixteen Million Thirty Six Thousand Three Hundred Forty Six (16,036,346) shares
of its Series B Preferred Stock (the “Shares”);
Whereas, Purchasers desire to purchase the Shares on the terms and conditions
set forth herein; and
Whereas, the Company desires to issue and sell the Shares to Purchasers on the
terms and conditions set forth herein.
Agreement
Now, Therefore, in consideration of the foregoing recitals and the mutual
promises, representations, warranties, and covenants hereinafter set forth and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:
1. Agreement To Sell And Purchase.
1.1 Authorization of Shares. The Company has authorized (a) the sale and
issuance to Purchasers of the Shares and (b) the issuance of such shares of
Common Stock to be issued upon conversion of the Shares (the “Conversion
Shares”). The Shares and the Conversion Shares have the rights, preferences,
privileges and restrictions set forth in the Amended and Restated Certificate of
Incorporation of the Company, in the form attached hereto as Exhibit B (the
“Restated Charter”).
1.2 Sale and Purchase. Subject to the terms and conditions hereof, at the
Closing (as hereinafter defined) the Company hereby agrees to issue and sell to
each Purchaser, and each Purchaser agrees to purchase from the Company,
severally and not jointly, the number of Shares set forth opposite such
Purchaser’s name on Exhibit A, at a purchase price of Seventy-Four and Eighty
Three Hundredths of a Cent ($0.7483) per share.

 

 

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2. Closing, Delivery And Payment.
2.1 Closing. The closing of the sale and purchase of the Shares under this
Agreement (the “Closing”) shall take place at 11:00 a.m. on the date hereof, at
the offices of Fenwick and West LLP, 801 California Street, Mountain View, CA
94041 or at such other time or place as the Company and Purchasers may mutually
agree (such date is hereinafter referred to as the “Closing Date”).
2.2 Delivery. At the Closing, subject to the terms and conditions hereof, the
Company will deliver to each Purchaser a certificate representing the number of
Shares to be purchased at the Closing by such Purchaser, against payment of the
purchase price therefor by check or wire transfer made payable to the order of
the Company.
3. Representations And Warranties Of The Company.
Except as set forth on a Schedule of Exceptions delivered by the Company to
Purchasers at the Closing attached hereto as Exhibit C, the Company hereby
represents and warrants to each Purchaser as of the date of this Agreement as
set forth below. For purposes of this Section 3, the terms “to the Company’s
Knowledge,” “to its Knowledge” or “Known” shall mean the knowledge of Renaud
Laplanche, John Donovan, and Soulaiman Htite, as such knowledge as such
individuals would have after reasonable investigation.
3.1 Organization, Good Standing and Qualification. The Company is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware. The Company has all requisite corporate power and authority
to own and operate its properties and assets, to execute and deliver this
Agreement and the Amended and Restated Investor Rights Agreement in the form
attached hereto as Exhibit D (the “Investor Rights Agreement”), the Amended and
Restated Right of First Refusal and Co-Sale Agreement in the form attached
hereto as Exhibit E (the “Co-Sale Agreement”), and the Amended and Restated
Voting Agreement in the form attached hereto as Exhibit F (the “Voting
Agreement”) (collectively, the “Related Agreements”), to issue and sell the
Shares and the Conversion Shares, and to carry out the provisions of this
Agreement, the Related Agreements and the Restated Charter and to carry on its
business as presently conducted and as presently proposed to be conducted. The
Company is duly qualified to do business and is in good standing as a foreign
corporation in California and in all jurisdictions in which the nature of its
activities and of its properties (both owned and leased) makes such
qualification necessary, except for those jurisdictions in which failure to do
so would not have a material adverse effect on the Company or its business.
3.2 Subsidiaries. The Company does not own or control, directly or indirectly,
any equity security or other interest of any other corporation, partnership,
limited liability company or other business entity. The Company is not a
participant in any joint venture, partnership, limited liability company or
similar arrangement. Since its inception, the Company has not consolidated or
merged with, acquired all or substantially all of the assets of, or acquired the
stock of or any interest in any corporation, partnership, limited liability
company or other business entity.

 

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3.3 Capitalization; Voting Rights.
(a) The authorized capital stock of the Company, immediately prior to the
Closing, consists of (i) 50,000,000 shares of Common Stock, par value $0.01 per
share, 8,199,750 shares of which are issued and outstanding, and (ii) 33,200,000
shares of Preferred Stock, par value $0.01 per share, 17,100,000 of which are
designated Series A Preferred Stock, 15,740,285 are issued and outstanding, and
16,100,000 are designated Series B Preferred Stock, none of which are issued and
outstanding.
(b) Under the Company’s 2007 Stock Incentive Plan (the “Plan”), (i) no shares
have been issued pursuant to restricted stock purchase agreements and/or the
exercise of outstanding options, (ii) options to purchase 1,906,050 shares of
Common Stock have been granted and are currently outstanding, and
(iii) 4,632,200 shares of Common Stock remain available for future issuance to
officers, directors, employees and consultants of the Company. The Company has
furnished to the Purchasers complete and accurate copies of the Plan and forms
of agreements used thereunder. The Company has not made any representations
regarding equity incentives to any officer, employee, director or consultant
that are inconsistent with the share amounts and terms set forth in the
Company’s board minutes.
(c) Warrants to purchase 325,000 shares of Common Stock are outstanding.
(d) Warrants to purchase 1,265,990 shares of Series A Preferred Stock are
outstanding.
(e) Other than the shares reserved for issuance under the Plan, and except as
may be granted pursuant to this Agreement and the Related Agreements, there are
no outstanding options, warrants, rights (including conversion or preemptive
rights and rights of first refusal), proxy or stockholder agreements, or
agreements of any kind for the purchase or acquisition from the Company of any
of its securities.
(f) All issued and outstanding shares of the Company’s capital stock (i) have
been duly authorized and validly issued and are fully paid and nonassessable,
(ii) were issued in compliance with all applicable state and federal laws
concerning the issuance of securities, and (iii) as to the issued and
outstanding shares of the Company’s Common Stock, are subject to a right of
first refusal in favor of the Company upon transfer.
(g) The rights, preferences, privileges and restrictions of the Shares are as
stated in the Restated Charter. The Conversion Shares have been duly and validly
reserved for issuance. When issued in compliance with the provisions of this
Agreement and the Restated Charter, the Shares and the Conversion Shares will be
validly issued, fully paid and nonassessable, and will be free of any liens or
encumbrances other than (i) liens and encumbrances created by or imposed upon
the Purchasers and (ii) any right of first refusal set forth in the Company’s
Bylaws; provided, however, that the Shares and the Conversion Shares may be
subject to restrictions on transfer under state and/or federal securities laws
as set forth herein or as otherwise required by such laws at the time a transfer
is proposed. The sale of the Shares and the subsequent conversion of the Shares
into Conversion Shares are not and will not be subject to any preemptive rights
or rights of first refusal that have not been properly waived or complied with.

 

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(h) All outstanding options (and Common Stock issued upon exercise of such
options) vest as follows: twenty-five percent (25%) of the shares vest one
(1) year following the vesting commencement date, with the remaining
seventy-five percent (75%) vesting in equal quarterly installments over the next
three (3) years, and, as of the Closing, no such options or shares are more than
twenty five percent (25%) vested. No stock plan, stock purchase, stock option or
other agreement or understanding between the Company and any holder of any
equity securities or rights to purchase equity securities provides for
acceleration or other changes in the vesting provisions or other terms of such
agreement or understanding as the result of (i) termination of employment or
consulting services (whether actual or constructive); (ii) any merger, sale of
stock or assets, change in control or any other transaction(s) by the Company;
or (iii) the occurrence of any other event or combination of events. All
outstanding options and warrants to purchase shares of the Company’s capital
stock have been issued in compliance with all applicable federal, state, foreign
or local statutes, laws, rules, or regulations, including federal and state
securities laws, and were issued and transferred in accordance with any right of
first refusal or similar right or limitation Known to the Company, including
those in the Company’s certificate of incorporation and Bylaws, each as amended
to date.
(i) All outstanding shares of Common Stock and all shares of Common Stock
issuable upon the exercise or conversion of outstanding options, warrants or
other exercisable or convertible securities are subject to a market standoff or
“lockup” agreement of not less than 180 days following the Company’s initial
public offering.
(j) The Company has never adjusted or amended the exercise price of any stock
options previously awarded, whether through amendment, cancellation, replacement
grant, repricing, or any other means. Except as set forth in the Restated
Charter, the Company has no obligation (contingent or otherwise) to purchase or
redeem any of its capital stock.
(k) The Company believes in good faith that any “nonqualified deferred
compensation plan” (as such term is defined under Section 409A(d)(1) of the
Internal Revenue Code of 1986, as amended (the “Code”), and the guidance
thereunder) under which the Company makes, is obligated to make or promises to
make, payments (each, a “409A Plan”) complies in all material respects, in both
form and operation, with the requirements of Section 409A of the Code and the
guidance thereunder. To the Knowledge of the Company, no payment to be made
under any 409A Plan is, or will be, subject to the penalties of
Section 409A(a)(1) of the Code.
3.4 Authorization; Binding Obligations. All corporate action on the part of the
Company, its officers, and directors, including, but not limited to, the consent
of the board of directors and the stockholders, necessary for the authorization
of this Agreement and the Related Agreements, the performance of all obligations
of the Company hereunder and thereunder at the Closing and the authorization,
sale, issuance and delivery of the Shares pursuant hereto and the Conversion
Shares pursuant to the Restated Charter has been taken. The Agreement and the
Related Agreements, when executed and delivered, will be valid and binding
obligations of the Company enforceable in accordance with their terms, except
(a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other laws of general application affecting enforcement of creditors’ rights,
(b) general principles of equity that restrict the availability of equitable
remedies, and (c) to the extent that the enforceability of the indemnification
provisions in the Investor Rights Agreement may be limited by applicable laws.

 

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3.5 Financial Statements. The Company has made available to each Purchaser its
audited balance sheet for the year ended March 31, 2008, an audited statement of
income and cash flows for the year ended March 31, 2008 and an unaudited balance
sheet for the nine (9) month period ending December 31, 2008 (the “Statement
Date”) and unaudited statement of income and cash flows for the nine (9) month
period ending December 31, 2008 (collectively, all of the previously listed
financial statements being referred to as the “Financial Statements”). The
Financial Statements, together with the notes thereto, have been prepared in
accordance with generally accepted accounting principles applied on a consistent
basis throughout the periods indicated, except as disclosed therein and, as to
the unaudited Financial Statements, for the omission of notes thereto and normal
year-end audit adjustments, and present fairly the financial condition and
position of the Company as of March 31, 2008 and as of the Statement Date, as
the case may be.
3.6 Liabilities. The Company has no liabilities and, to its Knowledge, no
material contingent liabilities, not disclosed in the Financial Statements,
except current liabilities incurred in the ordinary course of business which
have not been, either in any individual case or in the aggregate, materially
adverse.
3.7 Agreements; Action.
(a) Except for agreements explicitly contemplated hereby and agreements between
the Company and its employees with respect to the sale of the Company’s
outstanding Common Stock, there are no agreements, understandings or proposed
transactions between the Company and any of its officers, directors, employees,
affiliates or any affiliate thereof.
(b) There are no agreements, understandings, instruments, contracts, proposed
transactions, judgments, orders, writs or decrees to which the Company is a
party, or to its Knowledge, by which it is bound, which may involve (i) future
obligations (contingent or otherwise) of, or payments to, the Company in excess
of $25,000, or (ii) the transfer or license of any patent, copyright, trade
secret or other proprietary right to or from the Company (other than licenses to
the Company of “off the shelf” software or other standard products), or
(iii) the grant of any rights affecting the development, manufacture, licensing,
distribution, marketing, or sale of the Company’s products or services, or
(iv) indemnification by the Company with respect to infringements of proprietary
rights.
(c) The Company has not (i) accrued, declared or paid any dividends, or
authorized or made any distribution upon or with respect to any class or series
of its capital stock, (ii) incurred or guaranteed any indebtedness for money
borrowed or any other liabilities (other than trade payables incurred in the
ordinary course of business or as disclosed in the Financial Statements)
individually in excess of $25,000 or, in the case of indebtedness and/or
liabilities individually less than $25,000, in excess of $50,000 in the
aggregate, (iii) made any loans or advances to any person, other than ordinary
advances for travel expenses, or (iv) sold, exchanged or otherwise disposed of
any of its assets or rights.

 

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(d) For the purposes of subsections (b) and (c) above, all indebtedness,
liabilities, agreements, understandings, instruments, contracts and proposed
transactions involving the same person or entity (including persons or entities
the Company has reason to believe are affiliated therewith) shall be aggregated
for the purpose of meeting the individual minimum dollar amounts of such
subsections.
(e) The Company is not a guarantor or indemnitor of any indebtedness of any
other person.
3.8 Obligations to Related Parties. There are no obligations of the Company to
officers, directors, stockholders, or employees of the Company other than
(a) for payment of salary for services rendered, (b) reimbursement for
reasonable expenses incurred on behalf of the Company and (c) for other standard
employee benefits made generally available to all employees (including stock
option agreements outstanding under any stock option plan approved by the Board
of Directors of the Company). None of the officers, directors or, to the
Company’s Knowledge, key employees or stockholders of the Company or any members
of their immediate families, is indebted to the Company or has any direct or
indirect ownership interest in any firm or corporation with which the Company is
affiliated or with which the Company has a business relationship, or any firm or
corporation that competes with the Company, other than (i) passive investments
in publicly traded companies (representing less than one percent (1%) of such
company) which may compete with the Company and (ii) investments by venture
capital funds with which directors of the Company may be affiliated and service
as a board member of a company in connection therewith due to a person’s
affiliation with a venture capital fund or similar institutional investor in
such company. No officer or director or any member of such officer’s or
director’s immediate families or, to the Company’s Knowledge, stockholder or any
member of such stockholder’s immediate family, is, directly or indirectly,
interested in any material contract with the Company (other than such contracts
as relate to any such person’s ownership of capital stock or other securities of
the Company).
3.9 Changes. Since the Statement Date, there has not been, to the Company’s
Knowledge:
(a) Any change in the assets, liabilities, financial condition or operations of
the Company from that reflected in the Financial Statements, other than changes
in the ordinary course of business, none of which individually or in the
aggregate has had or is reasonably expected to have a material adverse effect on
such assets, liabilities, financial condition or operations of the Company;
(b) Any resignation or termination of any officer, key employee or group of
employees of the Company;
(c) Any material change, except in the ordinary course of business, in the
contingent obligations of the Company by way of guaranty, endorsement,
indemnity, warranty or otherwise;

 

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(d) Any damage, destruction or loss, whether or not covered by insurance,
materially and adversely affecting the properties, business or financial
condition of the Company;
(e) Any waiver by the Company of a valuable right or of a material debt owed to
it;
(f) Any material change in any compensation arrangement or agreement with any
employee, officer, director or stockholder;
(g) Any labor organization activity related to the Company;
(h) Any sale, assignment, exclusive license or transfer of any patents,
trademarks, copyrights, trade secrets or other intangible assets;
(i) Any change in any material agreement to which the Company is a party or by
which it is bound, which materially and adversely affects the business, assets,
liabilities, financial condition or operations of the Company;
(j) Any loans made by the Company to or for the benefit of its employees,
officers or directors, or any members of their immediate families, other than
travel advances and other advances made in the ordinary course of business;
(k) Any resignation or termination of any executive officer or key employee of
the Company, and the Company is not aware of any impending resignation or
termination of employment of any such officer or key employee;
(l) Any satisfaction or discharge of any lien, claim, or encumbrance or payment
of any obligation by the Company, except in the ordinary course of business and
that is not material to the business, properties, prospects or financial
condition of the Company;
(m) Any mortgage, pledge, transfer of a security interest in, or lien, created
by the Company, with respect to any of its material properties or assets, except
liens for taxes not yet due and payable;
(n) Any declaration, setting aside or payment or other distribution in respect
of any of the Company’s capital stock, or any direct or indirect redemption,
purchase or other acquisition of any such stock by the Company;
(o) Any receipt of notice that there has been a loss of, or material order
cancellation by, any major customer of the Company;
(p) Any other event or condition of any character that, either individually or
cumulatively, has materially and adversely affected the business, assets,
liabilities, financial condition or operations of the Company; or
(q) Any arrangement or commitment by the Company to do any of the acts described
in subsection (a) through (p) above.

 

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3.10 Title to Properties and Assets; Liens, Etc. The Company has good and
marketable title to its properties and assets and good title to its leasehold
estates, in each case subject to no mortgage, pledge, lien, lease, encumbrance
or charge, other than (a) those resulting from taxes which have not yet become
delinquent, (b) minor liens and encumbrances which do not materially detract
from the value of the property subject thereto or materially impair the
operations of the Company, and (c) those that have otherwise arisen in the
ordinary course of business. With respect to the property and assets it leases,
the Company is in compliance with such leases in all material respects and holds
a valid leasehold interest free of any liens, claims or encumbrances, subject to
clauses (a) through (c) above.
3.11 Intellectual Property.
(a) The Company owns or possesses sufficient legal rights to all patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses,
information and other proprietary rights and processes necessary for its
business as now conducted and as presently proposed to be conducted, without any
known infringement of the rights of others. The Schedule of Exceptions contains
a complete list of the Company’s patents, trademarks copyrights and domain names
and pending patent, trademark and copyright applications. There are no
outstanding options, licenses or agreements of any kind relating to the
foregoing proprietary rights, nor is the Company bound by or a party to any
options, licenses or agreements of any kind with respect to the patents,
trademarks, service marks, trade names, copyrights, trade secrets, licenses,
information and other proprietary rights and processes of any other person or
entity other than such licenses or agreements arising from the purchase of “off
the shelf” software or standard products.
(b) The Company has not received any communications alleging that the Company
has violated or, by conducting its business as presently proposed to be
conducted, would violate any of the patents, trademarks, service marks, trade
names, copyrights or trade secrets or other proprietary rights of any other
person or entity, nor is the Company aware of any basis therefor.
(c) To the Company’s Knowledge, none of its employees is obligated under any
contract (including licenses, covenants or commitments of any nature) or other
agreement, or subject to any judgment, decree or order of any court or
administrative agency, that would interfere with their duties to the Company or
that would conflict with the Company’s business as proposed to be conducted.
Neither the execution nor delivery of this Agreement, nor the carrying on of the
Company’s business by the employees of the Company, nor the conduct of the
Company’s business as presently conducted, will, to the Company’s Knowledge,
conflict with or result in a breach of the terms, conditions or provisions of,
or constitute a default under, any contract, covenant or instrument under which
any of such employees is now obligated.

 

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(d) Each former and current employee, officer and consultant of the Company has
executed a proprietary information and inventions agreement in the form(s) as
delivered to Purchasers. No former or current employee, officer or consultant of
the Company (i) has excluded works or inventions made prior to his or her
employment with the Company from his or her assignment of inventions pursuant to
such employee, officer or consultant’s proprietary information and inventions
agreement; (ii) is, to the Company’s Knowledge, in violation of such employee,
officer or consultant’s proprietary information and inventions agreement; or
(iii) has failed to affirmatively indicate in such proprietary information and
inventions agreement that no such works or inventions made prior to his or her
employment with the Company exist. The Company does not believe it is or will be
necessary to utilize any inventions, trade secrets or proprietary information of
any of its employees made prior to their employment by the Company, except for
inventions, trade secrets or proprietary information that have been assigned to
the Company. Each employee and consultant has assigned to the Company all
intellectual property rights he or she owns that were created during such
employee’s or consultant’s service to the Company or using the Company’s
confidential information and are related to the Company’s business as now
conducted and as presently proposed to be conducted.
(e) The Company is not subject to any “open source” or “copyleft” obligations or
otherwise required to make any public disclosure or general availability of
source code either used or developed by the Company.
3.12 Compliance with Other Instruments. The Company is not in violation or
default of any term of its charter documents, each as amended, or of any
provision of any mortgage, indenture, contract, lease, agreement, instrument or
contract to which it is party or, to its Knowledge, by which it is bound or of
any judgment, decree, order or writ other than any such violation that would not
have a material adverse effect on the Company. The execution, delivery, and
performance of and compliance with this Agreement, and the Related Agreements,
and the issuance and sale of the Shares pursuant hereto and of the Conversion
Shares pursuant to the Restated Charter, will not, with or without the passage
of time or giving of notice, result in any such material violation, or be in
conflict with or constitute a material default under any such term or provision,
or result in the creation of any mortgage, pledge, lien, encumbrance or charge
upon any of the properties or assets of the Company or the suspension,
revocation, impairment, forfeiture or nonrenewal of any permit, license,
authorization or approval applicable to the Company, its business or operations
or any of its assets or properties. To the Company’s Knowledge, the Company has
not performed any act, or failed to perform any act, which action or failure to
act would result in the Company’s loss of any material right granted under any
license or other agreement required to be disclosed in the Schedule of
Exceptions.
3.13 Litigation. There is no action, suit, proceeding or investigation pending
or, to the Company’s Knowledge, currently threatened against the Company that
would reasonably be expected to result, either individually or in the aggregate,
in any material adverse change in the assets, condition or affairs of the
Company, financially or otherwise, or any change in the current equity ownership
of the Company or that questions the validity of this Agreement or the Related
Agreements or the right of the Company to enter into any of such agreements, or
to consummate the transactions contemplated hereby or thereby. The foregoing
includes, without limitation, actions pending or, to the Company’s Knowledge,
threatened involving the prior employment of any of the Company’s employees,
their use in connection with the Company’s business of any information or
techniques allegedly proprietary to any of their former employers, or their
obligations under any agreements with prior employers. The Company is not a
party or to its Knowledge subject to the provisions of any order, writ,
injunction, judgment or decree of any court or government agency or
instrumentality. There is no action, suit, proceeding or investigation by the
Company currently pending or which the Company intends to initiate.

 

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3.14 Tax Returns and Payments. The Company is and always has been a subchapter C
corporation. The Company has timely filed all tax returns (federal, state and
local) required to be filed by it, and there are in effect no waivers of
applicable statutes of limitations with respect to taxes for any year. Such tax
returns are true and correct and have been completed in accordance with
applicable law. All taxes shown to be due and payable on such returns, any
assessments imposed, and to the Company’s Knowledge all other taxes due and
payable by the Company on or before the Closing have been paid or will be paid
prior to the time they become delinquent. The Company has timely withheld and
paid over to the appropriate governmental authorities all amounts required to be
withheld and paid over with respect to its employees and other third parties.
The Company has not been advised (a) that any of its returns, federal, state or
other, have been or are being audited as of the date hereof, or (b) of any
deficiency in assessment or proposed judgment to its federal, state or other
taxes. The Company has no Knowledge of any liability of any tax to be imposed
upon its properties or assets as of the date of this Agreement that is not
adequately provided for.
3.15 Employees.
(a) The Company has no collective bargaining agreements with any of its
employees. There is no labor union organizing activity pending or, to the
Company’s Knowledge, threatened with respect to the Company.
(b) The Company is not a party to or bound by any currently effective employment
contract, deferred compensation arrangement, bonus plan, incentive plan, profit
sharing plan, retirement agreement or other employee compensation plan or
agreement.
(c) No employee of the Company has been granted the right to continued
employment by the Company or to any material compensation following termination
of employment with the Company.
(d) To the Company’s Knowledge, no employee of the Company, nor any consultant
with whom the Company has contracted, is in violation of any term of any
employment contract, proprietary information agreement or any other agreement
relating to the right of any such individual to be employed by, or to contract
with, the Company; and to the Company’s Knowledge the continued employment by
the Company of its present employees, and the performance of the Company’s
contracts with its independent contractors, will not result in any such
violation. The Company has not received any notice alleging that any such
violation has occurred.
(e) To the Company’s Knowledge, no officer, key employee or group of employees
intends to terminate his, her or their employment with the Company, nor does the
Company have a present intention to terminate the employment of any officer, key
employee or group of employees. Each former employee of the Company whose
employment was terminated by the Company has entered into an agreement with the
Company providing for the full release of any claims against the Company or any
related party arising out of such employment. There are no actions pending, or
to the Company’s Knowledge, threatened, by any former or current employee
concerning such person’s employment by the Company.

 

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(f) The Company is not delinquent in payments to any of its employees,
consultants, or independent contractors for any wages, salaries, commissions,
bonuses, or other direct compensation for any service performed for it or
amounts required to be reimbursed to such employees, consultants, or independent
contractors. The Company has complied in all material respects with all
applicable state and federal equal employment opportunity laws and with other
laws related to employment, including those related to wages, hours, worker
classification, and collective bargaining. The Company has withheld and paid to
the appropriate governmental entity or is holding for payment not yet due to
such governmental entity all amounts required to be withheld from employees of
the Company and is not liable for any arrears of wages, taxes, penalties, or
other sums for failure to comply with any of the foregoing.
3.16 Obligations of Management. Each officer and key employee of the Company is
currently devoting substantially all of his or her business time to the conduct
of the business of the Company. To the Company’s Knowledge, no officer or key
employee of the Company is planning to work less than full time at the Company
in the future. No officer or key employee is currently working or, to the
Company’s Knowledge, plans to work for a competitive enterprise, whether or not
such officer or key employee is or will be compensated by such enterprise.
3.17 Registration Rights and Voting Rights. Except as required pursuant to the
Investor Rights Agreement, the Company is presently not under any obligation,
and has not granted any rights, to register under the Securities Act of 1933, as
amended (the “Securities Act”), any of the Company’s presently outstanding
securities or any of its securities that may hereafter be issued. To the
Company’s Knowledge, except as contemplated in the Voting Agreement, no
stockholder of the Company has entered into any agreement with respect to the
voting of equity securities of the Company.
3.18 Compliance with Laws; Permits. The Company is not in violation of any
applicable statute, rule, regulation, order or restriction of any domestic or
foreign government or any instrumentality or agency thereof in respect of the
conduct of its business or the ownership of its properties, which violation
would materially and adversely affect the business, assets, liabilities,
financial condition, or operations of the Company. No governmental orders,
permissions, consents, approvals or authorizations are required to be obtained
and no registrations or declarations are required to be filed in connection with
the execution and delivery of this Agreement, the issuance of the Shares or the
Conversion Shares, or the consummation of any other transaction contemplated by
this Agreement, except such as have been duly and validly obtained or filed, or
with respect to any filings that must be made after the Closing, as will be
filed in a timely manner. The Company has all franchises, permits and any
similar authority necessary for the conduct of its business as now being
conducted by it, the lack of which could materially and adversely affect the
business, assets, properties or financial condition of the Company and believes
it can obtain, without undue burden or expense, any similar authority for the
conduct of its business as planned to be conducted. The Company has all licenses
(including without limitation lending licenses in each state) required for the
conduct of its business as now conducted and as presently proposed to be
conducted. The Company is not in default in any material respect under any of
such franchises, permits, licenses or other similar authority.

 

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3.19 Offering Valid. Assuming the accuracy of the representations and warranties
of Purchasers contained in Section 4.2 hereof, the offer, sale and issuance of
the Shares and the Conversion Shares will be exempt from the registration
requirements of the Securities Act, and will have been registered or qualified
(or are exempt from registration and qualification) under the registration,
permit or qualification requirements of all applicable state securities laws.
Neither the Company nor any agent on its behalf has solicited any offers to sell
or has offered to sell all or any part of the Shares to any person or persons so
as to bring the sale of such Shares by the Company within the registration
provisions of the Securities Act or any state securities laws.
3.20 Full Disclosure. The Company has provided Purchasers with all information
requested by the Purchasers in connection with their decision to purchase the
Shares. Neither this Agreement, the exhibits hereto, the Related Agreements nor
any other document delivered by the Company to Purchasers or their attorneys or
agents in connection herewith or therewith at the Closing or with the
transactions contemplated hereby or thereby, contain any untrue statement of a
material fact nor omit to state a material fact necessary in order to make the
statements contained herein or therein not misleading.
3.21 Qualified Small Business.
(a) The Company represents and warrants to Purchasers that, to the best of its
Knowledge, the Company is a “qualified small business” within the meaning of
Section 1202(d) of the Code, as of the date hereof, and the Shares qualify as
“qualified small business stock” as defined in Section 1202(c) of the Code as of
the date hereof. The Company further represents and warrants that, as of the
date hereof, it meets the “active business requirement” of Section 1202(e) of
the Code, and it has made no “significant redemptions” within the meaning of
Section 1202(c)(3)(B) of the Code.
(b) The Company represents and warrants to Purchasers that, to the best of its
Knowledge, (i) the Company will meet the requirements for qualification as
“qualified small business stock” set forth in Section 18152.5 of the California
Revenue and Taxation Code; (ii) the Company’s principal business operations are
in the State of California with more than eighty percent (80%) by value of the
Company’s payroll paid to residents of the State of California; (iii) more than
eighty percent (80%) by value of the assets of the Company are used by it in the
active conduct of one or more qualified trades or businesses in California, as
defined by Code Section 18152.5(e)(3), and (iv) the Company is an eligible
corporation, as defined by Code Section 18152.5(e)(4).
3.22 Corporate Documents. The Restated Charter and Bylaws of the Company are in
the form provided to the Purchasers. The minute books of the Company made
available to Purchasers contain a complete summary of all meetings of directors
and stockholders and all actions by written consent without a meeting by the
directors and stockholders since the time of incorporation and accurately
reflects in all material respects all actions by the directors (and any
committees of directors) and stockholders with respect to all transactions
referred to in such minutes.

 

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3.23 Real Property Holding Corporation. The Company is not a real property
holding corporation within the meaning of Code Section 897(c)(2) and any
regulations promulgated thereunder.
3.24 Insurance. The Company has general commercial, product liability, director
and officer liability, fire and casualty insurance policies with coverage
customary for companies similarly situated to the Company.
3.25 Executive Officers. No executive officer or person nominated to become an
executive officer of the Company (i) to the Company’s Knowledge, has been
convicted in a criminal proceeding or is a named subject of a pending criminal
proceeding (excluding minor traffic violations) or (ii) is or has been subject
to any judgment or order of, or is the subject of any pending civil or
administrative action by the Securities and Exchange Commission or any related
self-regulatory organization.
3.26 83(b) Elections. To the Company’s Knowledge, all individuals who have
purchased shares of the Company’s Common Stock under agreements that provide for
the vesting of such shares have timely filed elections under Section 83(b) of
the Code and any analogous provisions of applicable state tax laws.
3.27 Employee Benefit Plans. The Company is in substantial compliance with its
“employee benefits plans” as defined in the Employee Retirement Income Security
Act of 1974, as amended.
3.28 Investment Company. The Company is not an “investment company,” as such
term is defined in the Investment Company Act of 1940, as amended (the
“Investment Company Act”).
3.29 Internal Control Over Financial Reporting; Disclosure Controls and
Procedures.
(a) The Company maintains a system of internal control over financial reporting
(as such term is defined in Rule 13a-15(f) under the Securities Exchange Act of
1934, as amended (the “Exchange Act”)) that complies with the requirements of
the Exchange Act and has been designed by the Company’s principal executive
officer and principal financial officer, or under their supervision, to provide
reasonable assurance regarding the reliability of financial reporting and the
preparation of financial statements for external purposes in accordance with
generally accepted accounting principles. Except as disclosed in the Schedule of
Exceptions, the Company’s internal control over financial reporting is effective
and the Company is not aware of any material weaknesses in its internal control
over financial reporting.
(b) Except as disclosed in the Schedule of Exceptions, since the date of the
filing of the Company’s Form 10-Q for the quarterly period ended December 31,
2008, there has been no change in the Company’s internal control over financial
reporting that has materially affected, or is reasonably likely to materially
affect, the Company’s internal control over financial reporting.

 

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(c) The Company maintains disclosure controls and procedures (as such term is
defined in Rule 13a-15(e) under the Exchange Act) that comply with the
requirements of the Exchange Act; such disclosure controls and procedures have
been designed to ensure that material information relating to the Company and
its subsidiaries is made known to the Company’s principal executive officer and
principal financial officer by others within those entities; and such disclosure
controls and procedures are effective.
4. Representations And Warranties Of Purchasers.
Each Purchaser hereby represents and warrants to the Company, severally and not
jointly, as follows (provided that such representations and warranties do not
lessen or obviate the representations and warranties of the Company set forth in
this Agreement):
4.1 Requisite Power and Authority. Purchaser has all necessary power and
authority to execute and deliver this Agreement and the Related Agreements and
to carry out their provisions. All action on Purchaser’s part required for the
lawful execution and delivery of this Agreement and the Related Agreements has
been taken. Upon their execution and delivery, this Agreement and the Related
Agreements will be valid and binding obligations of Purchaser, enforceable in
accordance with their terms, except (a) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other laws of general application
affecting enforcement of creditors’ rights, (b) as limited by general principles
of equity that restrict the availability of equitable remedies, and (c) to the
extent that the enforceability of the indemnification provisions of the Investor
Rights Agreement may be limited by applicable laws.
4.2 Investment Representations. Purchaser understands that neither the Shares
nor the Conversion Shares have been registered under the Securities Act.
Purchaser also understands that the Shares are being offered and sold pursuant
to an exemption from registration contained in the Securities Act based in part
upon Purchaser’s representations contained in the Agreement. Purchaser hereby
represents and warrants as follows:
(a) Purchaser Bears Economic Risk. Purchaser has substantial experience in
evaluating and investing in private placement transactions of securities in
companies similar to the Company so that it is capable of evaluating the merits
and risks of its investment in the Company and has the capacity to protect its
own interests. Purchaser must bear the economic risk of this investment
indefinitely unless the Shares (or the Conversion Shares) are registered
pursuant to the Securities Act, or an exemption from registration is available.
Purchaser understands that the Company has no present intention of registering
the Shares, the Conversion Shares or any shares of its Common Stock. Purchaser
also understands that there is no assurance that any exemption from registration
under the Securities Act will be available and that, even if available, such
exemption may not allow Purchaser to transfer all or any portion of the Shares
or the Conversion Shares under the circumstances, in the amounts or at the times
Purchaser might propose.
(b) Acquisition for Own Account. Purchaser is acquiring the Shares and the
Conversion Shares for Purchaser’s own account for investment only, and not with
a view towards their distribution.

 

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(c) Purchaser Can Protect Its Interest. Purchaser represents that by reason of
its, or of its management’s, business or financial experience, Purchaser has the
capacity to protect its own interests in connection with the transactions
contemplated in this Agreement, and the Related Agreements. Further, Purchaser
is aware of no publication of any advertisement in connection with the
transactions contemplated in the Agreement.
(d) Accredited Investor. Purchaser represents that it is an “accredited
investor” within the meaning of Regulation D under the Securities Act.
(e) Company Information. Purchaser has had an opportunity to discuss the
Company’s business, management and financial affairs with directors, officers
and management of the Company and has had the opportunity to review the
Company’s operations and facilities. Purchaser has also had the opportunity to
ask questions of and receive answers from, the Company and its management
regarding the terms and conditions of this investment.
(f) Rule 144. Purchaser acknowledges and agrees that the Shares, and, if issued,
the Conversion Shares are “restricted securities” as defined in Rule 144
promulgated under the Securities Act as in effect from time to time and must be
held indefinitely unless they are subsequently registered under the Securities
Act or an exemption from such registration is available. Purchaser has been
advised or is aware of the provisions of Rule 144, which permits limited resale
of shares purchased in a private placement subject to the satisfaction of
certain conditions, including, among other things: the availability of certain
current public information about the Company, the resale occurring following the
required holding period under Rule 144 and the number of shares being sold
during any three-month period not exceeding specified limitations.
(g) Residence. If Purchaser is an individual, then Purchaser resides in the
state or province identified in the address of Purchaser set forth on Exhibit A;
if Purchaser is a partnership, corporation, limited liability company or other
entity, then the office or offices of Purchaser in which its investment decision
was made is located at the address or addresses of Purchaser set forth on
Exhibit A.
(h) Foreign Investors. If Purchaser is not a United States person (as defined by
Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended), Purchaser
hereby represents that it has satisfied itself as to the full observance of the
laws of its jurisdiction in connection with any invitation to subscribe for the
Shares or any use of this Agreement, including (i) the legal requirements within
its jurisdiction for the purchase of the Shares, (ii) any foreign exchange
restrictions applicable to such purchase, (iii) any government or other consents
that may need to be obtained, and (iv) the income tax and other tax
consequences, if any, that may be relevant to the purchase, holding, redemption,
sale or transfer of the Shares. The Company’s offer and sale and Purchaser’s
subscription and payment for and continued beneficial ownership of the Shares
will not violate any applicable securities or other laws of Purchaser’s
jurisdiction.

 

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4.3 Transfer Restrictions. Each Purchaser acknowledges and agrees that the
Shares and, if issued, the Conversion Shares are subject to restrictions on
transfer as set forth in the Investor Rights Agreement.
5. Conditions To Closing.
5.1 Conditions to Purchasers’ Obligations at the Closing. Purchasers’
obligations to purchase the Shares at the Closing are subject to the
satisfaction, at or prior to the Closing Date, of the following conditions:
(a) Representations and Warranties True; Performance of Obligations. The
representations and warranties made by the Company in Section 3 hereof shall be
true and correct as of the Closing Date with the same force and effect as if
they had been made as of the Closing Date, and the Company shall have performed
all obligations and conditions herein required to be performed or observed by it
on or prior to the Closing.
(b) Legal Investment. On the Closing Date, the sale and issuance of the Shares
and the proposed issuance of the Conversion Shares shall be legally permitted by
all laws and regulations to which Purchasers and the Company are subject.
(c) Consents, Permits, and Waivers. The Company shall have obtained any and all
consents, permits and waivers necessary or appropriate for consummation of the
transactions contemplated by the Agreement and the Related Agreements (including
any filing required to comply with the Hart Scott Rodino Antitrust Improvements
Act of 1976, as amended) except for such as may be properly obtained subsequent
to the Closing.
(d) Filing of Restated Charter. The Restated Charter shall have been filed with
the Secretary of State of the State of Delaware and shall continue to be in full
force and effect as of the Closing Date.
(e) Corporate Documents. The Company shall have delivered to Purchasers or their
counsel copies of all corporate documents of the Company as Purchasers shall
reasonably request, and such Purchasers shall have completed their due diligence
to their satisfaction.
(f) Reservation of Conversion Shares. The Conversion Shares issuable upon
conversion of the Shares shall have been duly authorized and reserved for
issuance upon such conversion.
(g) Compliance Certificate. The Company shall have delivered to Purchasers a
Compliance Certificate, executed by the President of the Company, dated the
Closing Date, to the effect that the conditions specified in subsections (a),
(c), (d) and (f) of this Section 5.1 have been satisfied.
(h) Secretary’s Certificate. Purchasers shall have received from the Company’s
Secretary, a certificate having attached thereto (i) the Company’s Restated
Charter as in effect at the time of the Closing, (ii) the Company’s Bylaws as in
effect at the time of the Closing, (iii) resolutions approved by the Board of
Directors authorizing the transactions contemplated hereby, (iv) resolutions
approved by the Company’s stockholders authorizing the filing of the Restated
Charter, and (v) good standing certificates (including tax good standing) with
respect to the Company from the applicable authority(ies) in Delaware and in
California, dated a recent date before the Closing.

 

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(i) Investor Rights Agreement. The Investor Rights Agreement shall have been
executed and delivered by the Company and each Investor (as such term is defined
therein).
(j) Co-Sale Agreement. The Co-Sale Agreement shall have been executed and
delivered by the Company, the Key Holders and the Investors (as such terms are
defined therein).
(k) Voting Agreement. The Voting Agreement shall have been executed and
delivered by the Company, the Key Holders, the Investors and the Designated
Common Stockholders (as such terms are defined therein).
(l) Indemnification Agreements. The Company shall have entered into an
Indemnification Agreement in substantially the form attached hereto as Exhibit G
with each member of the Board of Directors.
(m) Board of Directors. Upon the Closing, the authorized size of the Board of
Directors of the Company shall be five (5) members and the Board shall initially
consist of Renaud Laplanche, Rebecca Lynn, Jeffrey Crowe, Daniel Ciporin and one
(1) vacancy.
(n) Legal Opinion. Purchasers shall have received from legal counsel to the
Company an opinion addressed to them, dated as of the Closing Date, in
substantially the form attached hereto as Exhibit H.
(o) Proceedings and Documents. All corporate and other proceedings in connection
with the transactions contemplated at the Closing hereby and all documents and
instruments incident to such transactions shall be reasonably satisfactory in
substance and form to Purchasers and their special counsel, and Purchasers and
their special counsel shall have received all such counterpart originals or
certified or other copies of such documents as they may reasonably request.
(p) Proprietary Information and Inventions Agreement. The Company and each of
its current and former officers, employees and consultants shall have entered
into the Company’s standard form of Proprietary Information and Inventions
Agreement, in a form reasonably acceptable to Purchasers, with no exceptions
noted in such agreements.
(q) Increase in Option Pool. The Board of Directors and the Company’s
stockholders shall have approved an increase in the number of shares of Common
Stock authorized for issuance under the Plan by 2,856,000 shares of Common stock
such that a total of 6,548,000 shares of Common Stock shall be authorized for
issuance under the Plan as of the date hereof.

 

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(r) Commencement of Employment of Chief Marketing Officer. The candidate
proposed to be the Company’s Chief Marketing Officer shall have commenced
employment with the Company.
(s) Board Approval of Initiation of Search for Chief Credit Officer. The Board
of Directors shall have approved the commencement of an executive search for a
Chief Credit Officer for the Company with the goal of hiring such officer within
six (6) months of the Closing Date.
(t) Attorneys’ Fees. The Company shall pay the fees set forth in Section 6.10 of
this Agreement.
5.2 Conditions to Obligations of the Company. The Company’s obligation to issue
and sell the Shares at each Closing is subject to the satisfaction, on or prior
to such Closing, of the following conditions:
(a) Representations and Warranties True. The representations and warranties in
Section 4 made by those Purchasers acquiring Shares hereof shall be true and
correct at the date of the Closing, with the same force and effect as if they
had been made on and as of said date.
(b) Performance of Obligations. Such Purchasers shall have performed and
complied with all agreements and conditions herein required to be performed or
complied with by such Purchasers on or before the Closing.
(c) Filing of Restated Charter. The Restated Charter shall have been filed with
the Secretary of State of the State of Delaware.
(d) Voting Agreement. The Voting Agreement shall have been executed and
delivered by the Company, the Key Holders, the Investors and the Designated
Common Stockholders (as such terms are defined therein).
(e) Consents, Permits, and Waivers. The Company shall have obtained any and all
consents, permits and waivers necessary or appropriate for consummation of the
transactions contemplated by the Agreement and the Related Agreements (including
any filing required to comply with the Hart Scott Rodino Antitrust Improvements
Act of 1976, as amended, and except for such as may be properly obtained
subsequent to the Closing).

 

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6. Miscellaneous.
6.1 Governing Law. This Agreement shall be governed by and construed under the
laws of the State of California in all respects as such laws are applied to
agreements among California residents entered into and performed entirely within
California, without giving effect to conflict of law principles thereof. The
parties agree that any action brought by either party under or in relation to
this Agreement, including without limitation to interpret or enforce any
provision of this Agreement, shall be brought in, and each party agrees to and
does hereby submit to the jurisdiction and venue of, any state or federal court
located in the County of Santa Clara, California.
6.2 Survival; Limitation of Liability. The representations, warranties,
covenants and agreements made herein shall survive the closing of the
transactions contemplated hereby; provided, however, that in the event a
Purchaser receives written notice of a breach of any representation, warranty,
covenant or agreement made herein by the Company, such Purchaser shall have two
(2) years after the date of such notice to bring a claim against the Company in
connection with such breach; provided further, however, that in the event that
such Purchaser obtains knowledge of any breach of any representation, warranty,
covenant or agreement made herein by the Company after the Closing, such
Purchaser shall promptly provide notice to the Company of such breach. All
statements as to factual matters contained in any certificate or other
instrument delivered by or on behalf of the Company pursuant hereto in
connection with the transactions contemplated hereby shall be deemed to be
representations and warranties by the Company hereunder solely as of the date of
such certificate or instrument. The representations, warranties, covenants and
obligations of the Company, and the rights and remedies that may be exercised by
the Purchasers, shall not be limited or otherwise affected by or as a result of
any information furnished to, or any investigation made by or knowledge of, any
of the Purchasers or any of their representatives.
6.3 Successors and Assigns. Except as otherwise expressly provided herein, the
provisions hereof shall inure to the benefit of, and be binding upon the 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 the Shares from time to time; provided, however,
that prior to the receipt by the Company of adequate written notice of the
transfer of any Shares specifying the full name and address of the transferee,
the Company may deem and treat the person listed as the holder of such Shares in
its records as the absolute owner and holder of such Shares for all purposes.
6.4 Entire Agreement. This Agreement, the exhibits and schedules hereto, the
Related Agreements and the other documents delivered pursuant hereto constitute
the full and entire understanding and agreement between the parties with regard
to the subjects hereof and no party shall be liable for or bound to any other in
any manner by any oral or written representations, warranties, covenants and
agreements except as specifically set forth herein and therein.
6.5 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.

 

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6.6 Amendment and Waiver. This Agreement may be amended or modified, and the
obligations of the Company and the rights of the holders of the Shares and the
Conversion Shares under the Agreement may be waived, only upon the written
consent of the Company and holders of at least fifty-five percent (55%) of the
Shares purchased pursuant to this Agreement (treated as if converted and
including any Conversion Shares into which the then outstanding Shares have been
converted that have not been sold to the public).
6.7 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, the Related Agreements or
the Restated Charter, 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 or in 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, the Related Agreements or the Restated
Charter or any waiver on such party’s part of any provisions or conditions of
the Agreement, the Related Agreements or the Restated Charter must be in writing
and shall be effective only to the extent specifically set forth in such
writing. All remedies, either under this Agreement, the Related Agreements or
the Restated Charter or otherwise shall be cumulative and not alternative.
6.8 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, telex 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 to the Company
at the address as set forth on the signature page hereof and to Purchaser at the
address set forth on Exhibit A attached hereto or at such other address or
electronic mail address as the Company or Purchaser may designate by ten
(10) days advance written notice to the other parties hereto.
6.9 Expenses. Each party shall pay all costs and expenses that it incurs with
respect to the negotiation, execution, delivery and performance of the
Agreement; provided, however, that the Company shall, at the Closing, reimburse
the reasonable fees of and expenses of Wilson Sonsini Goodrich & Rosati PC, not
to exceed thirty thousand dollars ($30,000), incurred in connection with the
negotiation, execution, delivery and performance of this Agreement.
6.10 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.

 

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6.11 Titles and Subtitles. The titles of the sections and subsections of the
Agreement are for convenience of reference only and are not to be considered in
construing this Agreement.
6.12 Counterparts. This Agreement may be executed in any number of counterparts,
each of which shall be an original, but all of which together shall constitute
one instrument.
6.13 Broker’s Fees. Each party hereto represents and warrants that no agent,
broker, investment banker, person or firm acting on behalf of or under the
authority of such party hereto is or will be entitled to any broker’s or
finder’s fee or any other commission directly or indirectly in connection with
the transactions contemplated herein. Each party hereto further agrees to
indemnify each other party for any claims, losses or expenses incurred by such
other party as a result of the representation in this Section 6.13 being untrue.
6.14 Exculpation Among Purchasers. Each Purchaser acknowledges that it is not
relying upon any person, firm, or corporation, other than the Company and its
officers and directors, in making its investment or decision to invest in the
Company. Each Purchaser agrees that no Purchaser nor the respective controlling
persons, officers, directors, partners, agents, or employees of any Purchaser
shall be liable to any other Purchaser for any action heretofore or hereafter
taken or omitted to be taken by any of them in connection with the purchase of
the Shares and Conversion Shares.
6.15 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.

 

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6.16 California Corporate Securities Law. THE SALE OF THE SECURITIES WHICH ARE
THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF
CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF SUCH SECURITIES OR
THE PAYMENT OR RECEIPT OF ANY PART OF THE CONSIDERATION THEREFOR PRIOR TO SUCH
QUALIFICATION OR IN THE ABSENCE OF AN EXEMPTION FROM SUCH QUALIFICATION IS
UNLAWFUL. PRIOR TO ACCEPTANCE OF SUCH CONSIDERATION BY THE COMPANY, THE RIGHTS
OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON SUCH
QUALIFICATION BEING OBTAINED OR AN EXEMPTION FROM SUCH QUALIFICATION BEING
AVAILABLE.
6.17 Waiver of Conflict of Interest. Each Purchaser and the Company is aware
that Fenwick & West LLP (“F&W”) may have an investment in certain of the
Purchasers or may have previously performed and may continue to perform certain
legal services for certain of the Purchasers in matters unrelated to F&W’s
representation of the Company. In connection with its Purchaser representation,
F&W may have obtained confidential information of such Purchasers that could be
material to F&W’s representation of the Company in connection with negotiation,
execution and performance of this Agreement. By signing this Agreement, each New
Purchaser and the Company hereby (a) acknowledges that the terms of this
Agreement were negotiated between the Purchasers and the Company and (b) waives
any potential conflict of interest arising out of such representation or such
possession of confidential information. Each New Purchaser and the Company
further represents that it has had the opportunity to be, or has been,
represented by independent counsel in giving the waivers contained in this
Section 6.17.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

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In Witness Whereof, the parties hereto have executed the Series B Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.

              COMPANY:    
 
            LendingClub Corporation    
 
            Signature:   /s/ Renaud Laplanche              
 
  Print Name:   Renaud Laplanche    
 
  Title:   President & CEO    
 
  Address:   440 North Wolfe Road
Sunnyvale, CA 94085    

Signature Page to Series B Preferred Stock Purchase Agreement

 

 

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In Witness Whereof, the parties hereto have executed the Series B Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.

              PURCHASER(S):    
 
            Morgenthaler Ventures IX, L.P.    
 
            By: Morgenthaler Management
Partners IX, LLC, Its Managing
Partner    
 
            Signature:   /s/ Gary R. Little              
 
  Print Name:   Gary R. Little    
 
  Title:   Member    
 
  Address:   2710 Sand Hill Road, Ste. 100    
 
      Menlo Park, CA 94025    

Signature Page to Series B Preferred Stock Purchase Agreement

 

 

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In Witness Whereof, the parties hereto have executed the Series B Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.

              PURCHASER(S):    
 
            Norwest Venture Partners X, LP    
 
            by: genesis vc partners x, llc, its
general partner    
 
            Signature:   /s/ Jeffrey M. Crowe              
 
  Print Name:   Jeffrey M. Crowe    
 
  Title:   General Partner    
 
  Address:   525 University Avenue, Ste. 800    
 
      Palo Alto, CA 94301    

Signature Page to Series B Preferred Stock Purchase Agreement

 

 

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In Witness Whereof, the parties hereto have executed the Series B Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.

              PURCHASER(S):    
 
            Canaan VII L.P.     By: Canaan Partners VII LLC    
 
            Signature:   /s/ Eric A. Young              
 
  Print Name:   Eric A. Young    
 
  Title:   Member/Manager    
 
  Address:        
 
     
 
   
 
     
 
   

Signature Page to Series B Preferred Stock Purchase Agreement

 

 

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In Witness Whereof, the parties hereto have executed the Series B Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.

              PURCHASER(S):    
 
            Bay Partners XI, L.P.     By Bay Management Company XI, LLC, General
Partner    
 
            Signature:   /s/ Salil Deshpande              
 
  Print Name:   Salil Deshpande    
 
  Title:   Manager    
 
            Bay Partners XI Parallel Fund, L.P.     By Bay Management Company
XI, LLC, General Partner    
 
            Signature:   /s/ Salil Deshpande              
 
  Print Name:   Salil Deshpande    
 
  Title:   Manager    
 
  Address:   490 S. California Avenue, Suite 200    
 
      Palo Alto, CA 94306    

Signature Page to Series B Preferred Stock Purchase Agreement

 

 

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In Witness Whereof, the parties hereto have executed the Series B Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.

              PURCHASER(S):    
 
            Pierre Latecoere    
 
            Signature:   /s/ Pierre Latecoere              
 
  Print Name:   Pierre Latecoere    
 
  Title:        
 
  Address:  
 
27, ch. des Pecheurs    
 
      1166 Perroy, VD    
 
      Switzerland    

Signature Page to Series B Preferred Stock Purchase Agreement

 

 

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In Witness Whereof, the parties hereto have executed the Series B Preferred
Stock Purchase Agreement as of the date set forth in the first paragraph hereof.

              PURCHASER(S):    
 
            Daniel Ciporin    
 
            Signature:   /s/ Daniel Ciporin              
 
  Print Name:   Daniel Ciporin    
 
  Title:        
 
  Address:  
 
285 Riverside Ave    
 
      Westport, CT 06880    
 
           

Signature Page to Series B Preferred Stock Purchase Agreement

 

 

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List Of Exhibits

     
Schedule of Purchasers
  Exhibit A
 
   
Certificate of Incorporation
  Exhibit B
 
   
Schedule of Exceptions
  Exhibit C
 
   
Investor Rights Agreement
  Exhibit D
 
   
Co-Sale Agreement
  Exhibit E
 
   
Voting Agreement
  Exhibit F
 
   
Form of Indemnification Agreement
  Exhibit G
 
   
Form of Legal Opinion
  Exhibit H

 

 

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Exhibit A
SCHEDULE OF PURCHASERS

                              Aggregate   Name and Address   Shares     Purchase
Price  
 
               
Morgenthaler Ventures IX, L.P.
    9,354,536     $ 6,999,999.29  
2710 Sand Hill Road, Suite 100
Menlo Park, CA 94025
               
 
               
Norwest Venture Partners X, LP
    3,091,663     $ 2,313,491.43  
525 University Avenue, Suite 800
Palo Alto, CA 94301
               
 
               
Canaan VII L.P.
    3,000,366     $ 2,245,173.88  
285 Riverside Avenue, Suite 250
Westport, CT 06880
               
 
               
Daniel Ciporin
    45,691     $ 34,190.58  
c/o Canaan Partners
285 Riverside Avenue, Suite 250
Westport, CT 06880
               
 
               
Bay Partners XI, L.P.
    408,402     $ 305,607.22  
2882 Sand Hill Road, Suite 240
Menlo Park, CA 94025
               
 
               
Bay Partners XI Parallel Fund, L.P.
    2,052     $ 1,535.52  
2882 Sand Hill Road, Suite 240
Menlo Park, CA 94025
               
 
               
Pierre Latecoere
    133,636     $ 99,999.82  
27, chemin des Pecheurs
1166 Perroy VD
Switzerland
               
 
           
 
               
Total:
    16,036,346     $ 11,999,997.74