Exhibit 10.31

 

CERTAIN MATERIAL (INDICATED BY ASTERISKS) HAS BEEN OMITTED FROM THIS DOCUMENT
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT. THE OMITTED MATERIAL HAS BEEN
FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION.

 

Execution Version

 

SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT

 

THIS SECOND AMENDMENT TO LOAN AND SECURITY AGREEMENT (this “Agreement”) is
entered into as of November 2, 2018, to be effective as of September 30, 2018
upon satisfaction of the conditions set forth in Section 3
below,  among  Restoration  Robotics,  Inc.,  a  Delaware  corporation (the
“Borrower”), Solar Capital Ltd., a Maryland corporation (in its capacity as
collateral agent, the “Collateral Agent”) and the Lenders party hereto,
comprising the Required Lenders under the Loan Agreement referred to below
(each, a “Lender” and, collectively, the “Lenders”).

 

RECITALS

 

A.The Borrower, the Lenders party thereto, and the Collateral Agent, are parties
to that certain Loan and Security Agreement, dated as of May 10, 2018, as
amended by that certain First Amendment to Loan and Security Agreement, dated as
of June 29, 2018 (as amended, supplemented or otherwise modified prior to the
date hereof, the “Loan Agreement”).

 

B.The Borrower has requested certain amendments to the Loan Agreement. Although
the Lenders and the Collateral Agent are under no obligation to do so, they have
agreed to such requests, subject to the terms and conditions hereof.

 

AGREEMENT

 

NOW, THEREFORE, in consideration of the foregoing recitals and other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, and intending to be legally bound, the parties hereto agree as
follows:

 

1.Definitions. Capitalized terms used but not defined in this Agreement shall
have the meanings given to them in the Loan Agreement.

 

2.Amendments to the Loan Agreement. The Loan Agreement shall be amended as
follows:

 

2.1Section 7.13. Section 7.13 of the Loan Agreement shall be amended and
restated in its entirety as follows:

 

Borrower shall not allow, at any time, the unrestricted cash and Cash
Equivalents of Borrower and its Subsidiaries to be an amount less than Twelve
Million Five Hundred Thousand Dollars ($12,500,000.00); provided, however, this
covenant shall no longer apply after the latest of the following to occur, (a)
Borrower has provided evidence reasonably satisfactory to the Collateral Agent
that Borrower has received after March 23, 2018 at least Twenty Five Million
Dollars ($25,000,000.00) in aggregate unrestricted net cash proceeds from the
sale and issuance of Borrower’s common or preferred stock pursuant to one or
more bona fide equity financings on terms reasonably acceptable to Collateral
Agent, (b) Borrower has provided evidence reasonably satisfactory to the
Collateral Agent that Borrower has at least Fifteen Million Dollars
($15,000,000.00) of actual net revenue for any trailing six-month period ending
after November 1, 2018, and (c) December 31, 2019.

 

--------------------------------------------------------------------------------

 

 

2.2The deadline for the deliveries required pursuant to Section 6.2(a)(i) and
Section 6.2(b) of the Loan Agreement with respect to the month ending on
September 30, 2018 shall be November 5, 2018 rather than October 30, 2018.

 

2.3Exhibit G. Exhibit G to the Loan Agreement shall be replaced in its entirety
with Exhibit A hereto.

 

3.Conditions to Effectiveness. The effectiveness of Section 2 shall be subject
to the satisfaction of each of the following conditions precedent, each in form
and substance reasonably satisfactory to Collateral Agent:

 

3.1the due execution and delivery to the Collateral Agent of this Agreement by
each party hereto;

 

3.2the due execution and delivery to the Collateral Agent of the Warrants
substantially in the forms attached hereto as Exhibit B;

 

3.3the delivery to the Collateral Agent of a certificate of Borrower which (a)
attaches copies of the current Operating Documents of the Borrower or certifies
that the copies of such Operating Documents previously delivered to the
Collateral Agent pursuant to the terms of the Loan Agreement have not been
amended, supplemented or restated since the date of such delivery; (b) attaches
copies of the resolutions adopted by Borrower’s board of directors which
approves the transactions contemplated by the Agreement; and (c) attaches
certified copies of the signatures of incumbent officers of the Borrower or
certifies that no changes in such officers has occurred since the most recent
delivery of such certified signatures;

 

3.4the Borrower shall have paid to the Lenders in accordance with their
respective Pro Rata Shares an amendment fee of Fifty Thousand Dollars
($50,000.00); and

 

3.5the Borrower shall have paid to the Lenders the reasonable out-of-pocket
costs and expenses of the Collateral Agent and the Lenders party hereto, and the
reasonable fees and disbursements of counsel to the Collateral Agent and the
Lenders party hereto, in connection with the negotiation, preparation, execution
and delivery of this Agreement and any other documents to be delivered in
connection herewith.

 

4.Representations and Warranties. The Borrower represents and warrants to the
Collateral Agent and each Lender as follows:

 

4.1Each of the representations and warranties made by the Borrower in or
pursuant to any Loan Document (a) that is qualified by materiality is true and
correct, and (b) that is not qualified by materiality is true and correct in all
material respects, in each case, on and as of the date of this Agreement, except
to the extent that any such representation and warranty specifically relates to
an earlier date, in which case such representation and warranty was true and
correct in all material respects as of such earlier date.

 

4.2The Borrower has the power and authority to execute and deliver this
Agreement and to perform its obligations under the Loan Documents.

 

4.3The execution and delivery by the Borrower of this Agreement, the performance
by Borrower of its obligations under the Loan Agreement, have been duly
authorized by all necessary corporate action on the part of the Borrower.

 

4.4The execution and delivery by the Borrower of this Agreement and the
performance

2

 

--------------------------------------------------------------------------------

 

by the Borrower of its obligations hereunder do not (a) conflict with any of the
Operating Documents of the Borrower, (b) contravene, conflict with, constitute a
default under or violate any material Requirement of Law applicable to the
Borrower, (c) contravene, conflict or violate any applicable order, writ,
judgment, injunction, decree, determination or award of any Governmental
Authority by which Borrower or any of its property or assets may be bound or
affected, (d) require any action by, filing, registration, or qualification
with, or Governmental Approval from, any Governmental Authority (except such
Governmental Approvals which have already been obtained and are in full force
and effect), or (e) constitute an event of default under any material agreement
by which Borrower or any of its properties, is bound.

 

4.5This Agreement has been duly executed and delivered by the Borrower and is
the valid and binding obligation of the Borrower, enforceable against the
Borrower in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or
other similar laws of general application and equitable principles relating to
or affecting creditors’ rights.

 

4.6Both immediately prior to giving effect hereto and immediately thereafter, no
Default or Event of Default has occurred and is continuing under the Loan
Agreement or the Loan Documents.

 

5.Reaffirmation of Loan Documents. The Borrower hereby grants, ratifies and
reaffirms the security interest in its Collateral granted to the Collateral
Agent pursuant to the terms of the Loan Agreement, and also ratifies and
reaffirms its obligations under each Loan Document to which it is party, and
acknowledges and agrees that each such Loan Document shall remain in full force
and effect after giving effect to the consummation of this Agreement. This
Agreement is not a novation and the terms and conditions of this Agreement shall
be in addition to and supplemental to all terms and conditions set forth in the
Loan Documents. In the event of any conflict or inconsistency between this
Agreement and the terms of any other Loan Document, the terms of this Agreement
shall be controlling, but such other Loan Document shall not otherwise be
affected or the rights therein impaired.

 

6.Integration. This Agreement and the other Loan Documents represent the entire
agreement relating to the subject matter of this Agreement and supersede all
prior negotiations and agreements with respect to the substance of this
Agreement. All prior agreements, understandings, representations, warranties,
and negotiations between the parties about the subject matter of this Agreement
and the Loan Documents merge into this Agreement and the Loan Documents

 

7.Counterparts. This Agreement may be executed in any number of counterparts and
all of such counterparts taken together shall be deemed to constitute one and
the same instrument.

 

8.Miscellaneous.

 

8.1Except as expressly amended pursuant hereto, the Loan Agreement and the other
Loan Documents shall remain unchanged and in full force and effect and are
hereby ratified and confirmed in all respects.

 

8.2This Agreement shall constitute a Loan Document under the Loan Agreement.

 

8.3Each provision of this Agreement is severable from every other provision in
determining the enforceability of any provision.

 

8.4This Agreement is effective for the purposes set forth herein and shall be
limited precisely as written and shall not be deemed to (a) be a consent to any
Agreement, waiver or modification of any term or condition of any Loan Document,
or (b) otherwise prejudice any right or remedy which the Collateral Agent or any
Lender may now have or may have in the future under or in connection with any

3

 

--------------------------------------------------------------------------------

 

Loan Document.

 

8.5This Agreement and all documents related hereto shall constitute Loan
Documents, shall be construed in connection with and as part of the Loan
Documents.

 

9.Governing Law. THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES
HERETO SHALL IN ALL RESPECTS BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH,
THE INTERNAL LAWS OF THE STATE OF NEW YORK (WITHOUT REGARD TO THE CONFLICT OF
LAWS PRINCIPLES OF SUCH STATE (OTHER THAN SECTION 5-1401 OF THE GENERAL
OBLIGATIONS LAW)), INCLUDING ALL MATTERS OF CONSTRUCTION, VALIDITY AND
PERFORMANCE, REGARDLESS OF THE LOCATION OF THE COLLATERAL, PROVIDED, HOWEVER,
THAT IF THE LAWS OF ANY JURISDICTION OTHER THAN NEW YORK SHALL GOVERN IN REGARD
TO THE VALIDITY, PERFECTION OR EFFECT OF PERFECTION OF ANY LIEN OR IN REGARD TO
PROCEDURAL MATTERS AFFECTING ENFORCEMENT OF ANY LIENS IN COLLATERAL, SUCH LAWS
OF SUCH OTHER JURISDICTIONS SHALL CONTINUE TO APPLY TO THAT EXTENT. This
Agreement is subject to the provisions of Section 11 of the Loan Agreement
relating to jurisdiction, venue, jury trial waiver and judicial reference, which
provisions are by this reference incorporated herein, mutatis mutandis, as if
set forth herein in full.

 

[Signature page follows.]

 

 

4

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have duly executed this Agreement, as of
the date first above written.

 

THE BORROWER

 

 

 

RESTORATION ROBOTICS,

 

 

 

 

By:

/s/ Mark Hair

 

Name:

Mark Hair

 

Title:

Chief Financial Officer

 

 

 

 

 

 

 

 

 

[Signature Page to Restoration Robotics Second Amendment to LSA]

 

--------------------------------------------------------------------------------

 

 

COLLATERAL AGENT AND LENDER:

 

 

 

SOLAR CAPITAL LTD.

 

 

 

 

By:

/s/Anthony J. Storino

 

Name:

Anthony Storino

 

Title:

Authorized Signatory

 

 

LENDER:

 

 

 

SCP PRNATE CREDIT INCOME FUNDS L.P.

 

 

 

 

By:

/s/ Anthony J. Storino

 

Name:

Anthony Storino

 

Title:

Authorized Signatory

 

 

LENDER:

 

 

 

SUNS SPV LLC

 

 

 

 

By:

/s/ Richard Petoka

 

Name:

Richard Petoka

 

Title:

Authorized Signatory

 

[Signature Page to Restoration Robotics Second Amendment to LSA]

 

--------------------------------------------------------------------------------

 

 

LENDER:

 

 

 

WESTERN ALLIANCE BANK

 

 

 

 

By:

/s/ Lindsay Fouty

 

Name:

Lindsay Fouty

 

Title:

V.P. Portfolio Management

 

 

 

 

[Signature Page to Restoration Robotics Second Amendment to LSA]

 

--------------------------------------------------------------------------------

 

EXHIBIT A

Revenue Projections

 

 

Restoration Robotics - Minimum Revenue Calculation

 

 

 

Month Ending

 

Management Case

 

Covenant %

 

Minimum Revenue Required

 

Sep-18

 

[***].

 

[***].

 

[***].

 

Oct-18

 

[***].

 

[***].

 

[***].

 

Nov-18

 

[***].

 

[***].

 

[***].

 

Dec-18

 

[***].

 

[***].

 

[***].

 

Jan-19

 

[***].

 

[***].

 

[***].

 

Feb-19

 

[***].

 

[***].

 

[***].

 

Mar-19

 

[***].

 

[***].

 

[***].

 

Apr-19

 

[***].

 

[***].

 

[***].

 

May-19

 

[***].

 

[***].

 

[***].

 

Jun-19

 

[***].

 

[***].

 

[***].

 

Jul-19

 

[***].

 

[***].

 

[***].

 

Aug-19

 

[***].

 

[***].

 

[***].

 

Sep-19

 

[***].

 

[***].

 

[***].

 

Oct-19

 

[***].

 

[***].

 

[***].

 

Nov-19

 

[***].

 

[***].

 

[***].

 

Dec-19

 

[***].

 

[***].

 

[***].

 

Jan-20

 

[***].

 

[***].

 

[***].

 

Feb-20

 

[***].

 

[***].

 

[***].

 

Mar-20

 

[***].

 

[***].

 

[***].

 

Apr-20

 

[***].

 

[***].

 

[***].

 

May-20

 

[***].

 

[***].

 

[***].

 

Jun-20

 

[***].

 

[***].

 

[***].

 

Jul-20

 

[***].

 

[***].

 

[***].

 

Aug-20

 

[***].

 

[***].

 

[***].

 

Sep-20

 

[***].

 

[***].

 

[***].

 

Oct-20

 

[***].

 

[***].

 

[***].

 

Nov-20

 

[***].

 

[***].

 

[***].

 

Dec-20

 

[***].

 

[***].

 

[***].

 

Jan-21

 

[***].

 

[***].

 

[***].

 

Feb-21

 

[***].

 

[***].

 

[***].

 

Mar-21

 

[***].

 

[***].

 

[***].

 

Apr-21

 

[***].

 

[***].

 

[***].

 

May-21

 

[***].

 

[***].

 

[***].

 

Jun-21

 

[***].

 

[***].

 

[***].

 

Jul-21

 

[***].

 

[***].

 

[***].

 

Aug-21

 

[***].

 

[***].

 

[***].

 

Sep-21

 

[***].

 

[***].

 

[***].

[***] 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.

 

--------------------------------------------------------------------------------

 

 

Oct-21

 

[***].

 

[***].

 

[***].

 

Nov-21

 

[***].

 

[***].

 

[***].

 

Dec-21

 

[***].

 

[***].

 

[***].

 

Jan-22

 

[***].

 

[***].

 

[***].

 

Feb-22

 

[***].

 

[***].

 

[***].

 

Mar-22

 

[***].

 

[***].

 

[***].

 

Apr-22

 

[***].

 

[***].

 

[***].

 

 

[***] 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 B

Warrants

 

 

 

--------------------------------------------------------------------------------

 

Execution Version

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED
UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY,
SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

WARRANT TO PURCHASE STOCK

 

Company:

Restoration Robotics, Inc.

Number of Shares:

40,431

Type/Series of Stock:

Common Stock, with par value of $0.0001 per share

Warrant Price:

$1.755 per share

Issue Date:

November 2, 2018

Expiration Date:

May 10, 2028 (See also Section 5.1(b))

Credit Facility:

This Warrant to Purchase Stock (“Warrant”) is issued in connection with that
certain Loan and Security Agreement dated as of May 10, 2018, between the Holder
and the Company (as may be amended from time to time, the “Loan Agreement”).

 

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, Western
Alliance Bank, an Arizona corporation with an office located at 55 S. Almaden
Boulevard, San Jose, CA 95113 (together with any successor or permitted assignee
or transferee of this Warrant or of any shares issued upon exercise hereof,
“Holder”) is entitled to purchase the number of fully paid and non-assessable -
(the “Shares”) of the above-stated Type/Series of Stock (the “Class”) of the
above-named company (the “Company”) at the above-stated Warrant Price, all as
set forth above and as adjusted pursuant to Section 2 of this Warrant, subject
to the provisions and upon the terms and conditions set forth in this Warrant.

 

SECTION 1. EXERCISE.

 

1.1Method of Exercise. Holder may at any time and from time to time exercise
this Warrant, in whole or in part, by delivering to the Company the original of
this Warrant together with a duly executed Notice of Exercise in substantially
the form attached hereto as Appendix 1 and, unless Holder is exercising this
Warrant pursuant to a cashless exercise set forth in Section 1.2, a check, wire
transfer of same-day funds (to an account designated by the Company), or other
form of payment acceptable to the Company for the aggregate Warrant Price for
the Shares being purchased.

 

1.2Cashless Exercise. On any exercise of this Warrant, in lieu of payment of the
aggregate Warrant Price in the manner as specified in Section 1.1 above, but
otherwise in accordance with the requirements of Section 1.1, Holder may elect
to receive Shares equal to the value of this Warrant, or portion hereof as to
which this Warrant is being exercised. Thereupon, the Company shall issue to the
Holder such number of fully paid and non-assessable Shares as are computed using
the following formula:

 

X = Y(A-B)/A

 

where:

X =the number of Shares to be issued to the Holder;

Y = the number of Shares with respect to which this Warrant is being exercised
(inclusive of the Shares surrendered to the Company in payment of the aggregate
Warrant Price);

 

A =   the Fair Market Value (as determined pursuant to Section 1.3 below) of  
one Share; and

 

B =the Warrant Price.

 

--------------------------------------------------------------------------------

 

 

1.3Fair Market Value. If the Company’s common stock is then traded or quoted on
a nationally recognized securities exchange, inter-dealer quotation system or
over-the-counter market (a “Trading Market”), the fair market value of a Share
shall be the volume-weighted average closing price of a share of common stock
reported for the ten (10) Business Days immediately before the date on which
Holder delivers this Warrant together with its Notice of Exercise to the
Company. If the Company’s common stock is not traded in a Trading Market, the
Board of Directors of the Company shall determine the fair market value of a
Share in its reasonable good faith judgment.

 

1.4Delivery of Certificate and New Warrant. Promptly after Holder exercises this
Warrant in the manner set forth in Section 1.1 or 1.2 above, the Company shall
deliver to Holder a certificate representing the Shares issued to Holder upon
such exercise and, if this Warrant has not been fully exercised and has not
expired, a new warrant of like tenor representing the Shares not so acquired.

 

1.5Replacement of Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in
the case of loss, theft or destruction, on delivery of an indemnity agreement
reasonably satisfactory in form, substance and amount to the Company or, in the
case of mutilation, on surrender of this Warrant to the Company for
cancellation, the Company shall, within a reasonable time, execute and deliver
to Holder, in lieu of this Warrant, a new warrant of like tenor and amount.

 

1.6Treatment of Warrant Upon Acquisition of Company.

 

(a)Acquisition. For the purpose of this Warrant, “Acquisition” means
any  transaction or series of related transactions involving: (i) the sale,
lease, exclusive license, or other disposition of all or substantially all of
the assets of the Company (ii) any merger or consolidation of the Company into
or with another person or entity (other than a merger or consolidation effected
exclusively to change the Company’s domicile), or any other corporate
reorganization, in which the stockholders of the Company in their capacity as
such immediately prior to such merger, consolidation or reorganization, own less
than a majority of the Company’s (or the surviving or successor entity’s)
outstanding voting power immediately after such merger, consolidation or
reorganization; or (iii) any sale or other transfer by the stockholders of the
Company of shares representing at least a majority of the Company’s then-total
outstanding combined voting power.

 

(b)Treatment of Warrant at Acquisition. In the event of an Acquisition in which
the consideration to be received by the Company’s stockholders consists solely
of cash, solely of Marketable Securities or a combination of cash and Marketable
Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this
Warrant pursuant to Section 1.1 and/or 1.2 and such exercise will be deemed
effective immediately prior to and contingent upon the consummation of such
Acquisition or (ii) if Holder elects not to exercise the Warrant, this Warrant
will expire immediately prior to the consummation of such Acquisition.

 

(c)The Company shall provide Holder with written notice of its request relating
to the Cash/Public Acquisition (together with such reasonable information as
Holder may reasonably require regarding the treatment of this Warrant in
connection with such contemplated Cash/Public Acquisition giving rise to such
notice), which is to be delivered to Holder not less than five (5) Business Days
prior to the closing of the proposed Cash/Public Acquisition. Notwithstanding
the foregoing, if, immediately prior to the Cash/Public Acquisition, the fair
market value of one Share (or other security issuable upon the exercise hereof)
as determined in accordance with Section 1.3 above would be greater than the
Warrant Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be exercised pursuant to Section 1.2 above as
to all Shares (or such other securities) for which it shall not previously have
been exercised, and the Company shall promptly notify the Holder of the number
of Shares (or such other securities) issued upon such exercise to the Holder.

 

 

--------------------------------------------------------------------------------

 

(d)Upon the closing of any Acquisition other than a Cash/Public Acquisition
defined above, the acquiring, surviving or successor entity shall assume the
obligations of this Warrant, and this Warrant shall thereafter be exercisable
for the same securities and/or other property as would have been paid for the
Shares issuable upon exercise of the unexercised portion of this Warrant as if
such Shares were outstanding on and as of the closing of such Acquisition,
subject to further adjustment from time to time in accordance with the
provisions of this Warrant.

 

(e)As used in this Warrant, “Marketable Securities” means securities meeting all
of the following requirements: (i) the issuer thereof is then subject to the
reporting requirements of Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and is then current in its filing
of all required reports and other information under the Act and the Exchange
Act; (ii) the class and series of shares or other security of the issuer that
would be received by Holder in connection with the Acquisition were Holder to
exercise this Warrant on or prior to the closing thereof is then traded in
Trading Market, and (iii) Holder would be able to publicly re-sell, within six
(6) months following the closing of such Acquisition, all of the issuer’s shares
and/or other securities that would be received by Holder in such Acquisition
were Holder to exercise this Warrant in full on or prior to the closing of such
Acquisition.

 

1.7Registration Rights. As to any Shares Holder receives or is entitled to
receive upon any exercise or conversion of this Warrant, Holder shall be
entitled to such demand registration rights and such piggyback registration
rights as are commensurate with such registration rights are set forth in that
certain Investors’ Rights Agreement, dated as of February 7, 2013 by and among
the Company and certain of the Company’s stockholders, as the same may be
amended from time to time, or similar agreement (the “Investors’ Rights
Agreement”).

 

SECTION 2. ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.

 

2.1Stock Dividends, Splits, Etc. If the Company declares or pays a dividend or
distribution on the outstanding shares of the Class payable in common stock or
other securities or property (other than cash), then upon exercise of this
Warrant, for each Share acquired, Holder shall receive, without additional cost
to Holder, the total number and kind of securities and property which Holder
would have received had Holder owned the Shares of record as of the date the
dividend or distribution occurred. If the Company subdivides the outstanding
shares of the Class by reclassification or otherwise into a greater number of
shares, the number of Shares purchasable hereunder shall be proportionately
increased and the Warrant Price shall be proportionately decreased. If the
outstanding shares of the Class are combined or consolidated, by
reclassification or otherwise, into a lesser number of shares, the Warrant Price
shall be proportionately increased and the number of Shares shall be
proportionately decreased.

 

2.2Reclassification, Exchange, Combinations or Substitution. Upon any event
whereby all of the outstanding shares of the Class are reclassified, exchanged,
combined, substituted, or replaced for, into, with or by Company securities of a
different class and/or series, then from and after the consummation of such
event, this Warrant will be exercisable for the number, class and series of
Company securities that Holder would have received had the Shares been
outstanding on and as of the consummation of such event, and subject to further
adjustment thereafter from time to time in accordance with the provisions of
this Warrant. The provisions of this Section 2.2 shall similarly apply to
successive reclassifications, exchanges, combinations substitutions,
replacements or other similar events.

 

2.3No Fractional Share. No fractional Share shall be issuable upon exercise of
this Warrant and the number of Shares to be issued shall be rounded down to the
nearest whole Share. If a fractional Share interest arises upon any exercise of
the Warrant, the Company shall eliminate such fractional Share interest by
paying Holder in cash the amount computed by multiplying the fractional interest
by (i) the fair market value (as determined in accordance with Section 1.3
above) of a full Share, less (ii) the then-effective Warrant Price.

 

2.4Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant
Price, Class and/or number of Shares, the Company, at the Company’s expense,
shall notify Holder in writing within a reasonable time setting forth the
adjustments to the Warrant Price, Class and/or number of Shares and facts upon
which such adjustment is based. The Company shall, upon written request from
Holder, furnish Holder with a certificate of its Chief Financial Officer,
including computations of such adjustment and the Warrant Price, Class and
number of Shares in effect upon the date of such adjustment.

 

--------------------------------------------------------------------------------

 

 

SECTION 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

 

3.1Representations and Warranties. The Company represents and warrants to, and
agrees with, the Holder as follows:

 

(a)The initial Warrant Price referenced on the first page of this Warrant is
equal to the lesser of (a) the ten (10) day trailing average of the Company’s
common stock price, as determined as of the close of business on the business
day immediately prior to the Issue Date, and (b) the Company’s common stock
price, as determined as of the close of business on the business day immediately
prior to the Issue Date.

 

(b)All Shares which may be issued upon the exercise of this Warrant, shall, upon
issuance, be duly authorized, validly issued, fully paid and non-assessable, and
free of any liens and encumbrances except for restrictions on transfer provided
for herein or under applicable federal and state securities laws. The Company
covenants that it shall at all times cause to be reserved and kept available out
of its authorized and unissued capital stock such number of shares of the Class,
common stock and other securities as will be sufficient to permit the exercise
in full of this Warrant.

 

3.2Notice of Certain Events. If the Company proposes at any time to:

 

(a)declare any dividend or distribution upon the outstanding shares of the Class
or common stock, whether in cash, property, stock, or other securities and
whether or not a regular cash dividend;

 

(c)effect any reclassification, exchange, combination, substitution,
reorganization or recapitalization of the outstanding shares of the Class; or

 

(d)effect an Acquisition or to liquidate, dissolve or wind up. then, in
connection with each such event, the Company shall give Holder:

(1)at least five (5) Business Days prior written notice of the date on which a
record will be taken for such dividend, distribution, or subscription rights
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled thereto) or for determining rights to vote, if any, in respect
of the matters referred to in (a) and (b) above; and

 

(2)in the case of the matters referred to in (c) and (d) above at least five (5)
Business Days prior written notice of the date when the same will take place
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled to exchange their shares for the securities or other property
deliverable upon the occurrence of such event).

 

Reference is made to Section 1.6(c) whereby this Warrant will be deemed to be
exercised pursuant to Section 1.2 hereof if the Company does not give written
notice to Holder of a Cash/Public Acquisition as required by the terms hereof.
Company will also provide information requested by Holder that is reasonably
necessary to enable Holder to comply with Holder’s accounting or reporting
requirements.

 

SECTION 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER.

 

The Holder represents and warrants to the Company as follows:

 

4.1Purchase for Own Account. This Warrant and the securities to be acquired upon
exercise of this Warrant by Holder are being acquired for investment for
Holder’s account, not as a nominee or agent, and not with a view to the public
resale or distribution within the meaning of the Act. Holder also represents
that it has not been formed for the specific purpose of acquiring this Warrant
or the Shares.

 

 

--------------------------------------------------------------------------------

 

4.2Disclosure of Information. Holder is aware of the Company’s business affairs
and financial condition and has received or has had full access to all the
information it considers necessary or appropriate to make an informed investment
decision with respect to the acquisition of this Warrant and its underlying
securities. Holder further has had an opportunity to ask questions and  receive
answers from the Company regarding the terms and conditions of the offering of
this Warrant and its underlying securities and to obtain additional information
(to the extent the Company possessed such information or could acquire it
without unreasonable effort or expense) necessary to verify any information
furnished to Holder or to which Holder has access.

 

4.3Investment Experience. Holder understands that the purchase of this Warrant
and its underlying securities involves substantial risk. Holder has experience
as an investor in securities of companies in the development stage and
acknowledges that Holder can bear the economic risk of such Holder’s investment
in this Warrant and its underlying securities and has such knowledge and
experience in financial or business matters that Holder is capable of evaluating
the merits and risks of its investment in this Warrant and its underlying
securities and/or has a preexisting personal or business relationship with the
Company and certain of its officers, directors or controlling persons of a
nature and duration that enables Holder to be aware of the character, business
acumen and financial circumstances of such persons.

 

4.4Accredited Investor Status. Holder is an “accredited investor” within the
meaning of Regulation D promulgated under the Act.

 

4.5The Act. Holder understands that this Warrant and the Shares issuable upon
exercise hereof have not been registered under the Act in reliance upon a
specific exemption therefrom, which exemption depends upon, among other things,
the bona fide nature of the Holder’s investment intent as expressed herein.
Holder understands that this Warrant and the Shares issued upon any exercise
hereof must be held indefinitely unless subsequently registered under the Act
and qualified under applicable state securities laws, or unless exemption from
such registration and qualification are otherwise available. Holder is aware of
the provisions of Rule 144 promulgated under the Act.

 

4.6Reserved.

 

4.7No Voting Rights. Holder, as a Holder of this Warrant, will not have any
voting rights until the exercise of this Warrant.

 

SECTION 5. MISCELLANEOUS.

 

5.1Term and Automatic Conversion Upon Expiration.

 

(a)Term. Subject to the provisions of Section 1.6 above, this Warrant is
exercisable in whole or in part at any time and from time to time on or before
6:00 PM, Pacific time, on the Expiration Date and shall be void thereafter.

 

(b)Automatic Cashless Exercise upon Expiration. In the event that, upon the
Expiration Date, the fair market value of one Share (or other security issuable
upon the exercise hereof) as determined in accordance with Section 1.3 above is
greater than the Warrant Price in effect on such date, then this Warrant shall
automatically be deemed on and as of such date to be exercised pursuant to
Section 1.2 above as to all Shares (or such other securities) for which it shall
not previously have been exercised, and the Company shall, within a reasonable
time, deliver a certificate representing the Shares (or such other securities)
issued upon such exercise to Holder.

 

5.2Legends. The Shares shall be imprinted with a legend in substantially the
following form:

 

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY
STATE AND, EXCEPT AS SET FORTH IN THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED
BY THE ISSUER TO WESTERN ALLIANCE BANK DATED

 

--------------------------------------------------------------------------------

 

NOVEMBER 2, 2018, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED
UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE
SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT
FROM SUCH REGISTRATION.

 

5.3Compliance with Securities Laws on Transfer. This Warrant and the Shares
issuable upon exercise of this Warrant may not be transferred or assigned in
whole or in part except in compliance with applicable federal and state
securities laws by the transferor and the transferee (including, without
limitation, the delivery of investment representation letters and legal opinions
reasonably satisfactory to the Company, as reasonably requested by the Company).
The Company shall not require Holder to provide an opinion of counsel if the
transfer is to Holder’s parent company, Western Alliance Bancorporation, or any
affiliate of Holder, provided that any such transferee is an “accredited
investor” as defined in Regulation D promulgated under the Act. Additionally,
the Company shall also not require an opinion of counsel if there is no material
question as to the availability of Rule 144 promulgated under the Act.

 

5.4Transfer Procedure. After receipt by Holder of the executed Warrant, Holder
may transfer all of this Warrant to Holder’s parent company, Western Alliance
Bancorporation, or an affiliate thereof or successor thereto (the “Subsequent
Holder”), by execution of an Assignment substantially in the form of Appendix 2.
Subject to the provisions of Section 5.3 and upon providing the Company with
written notice, Subsequent Holder may transfer all or part of this Warrant or
the Shares issuable upon exercise of this Warrant to any transferee, provided,
however, in connection with any such transfer, the Subsequent Holder will give
the Company notice of the portion of the Warrant being transferred with the
name, address and taxpayer identification number of the transferee and Holder
will surrender this Warrant to the Company for reissuance to the transferee(s)
(and Holder if applicable); and provided further, that any subsequent transferee
shall agree in writing with the Company to be bound by all of the terms and
conditions of this Warrant.

 

5.5Notices. All notices and other communications hereunder from the Company to
the Holder, or vice versa, shall be deemed delivered and effective (i) when
given personally, (ii) on the third (3rd) Business Day after being mailed by
first-class registered or certified mail, postage prepaid, (iii) upon actual
receipt if given by facsimile or electronic mail and such receipt is confirmed
in writing by the recipient, or (iv) on the first Business Day following
delivery to a reliable overnight courier service, courier fee prepaid, in any
case at such address as may have been furnished to the Company or Holder, as the
case may be, in writing by the Company or such Holder from time to time in
accordance with the provisions of this Section 5.5. All notices to Holder shall
be addressed as follows until the Company receives notice of a change of address
in connection with a transfer or otherwise:

 

Western Alliance Bank

55 S. Almaden Boulevard

San Jose, CA 95113

Attn: Robert Lake

 

Email: rob.lake@bridgebank.com

Notice to the Company shall be addressed as follows until Holder receives notice
of a change in address:

 

Restoration Robotics, Inc. 128 Baytech Drive

San Jose, CA

Attn: Chief Financial Officer

Email: markh@restorationrobotics.com

 

With a copy (which shall not constitute notice) to:

 

Latham & Watkins LLP 140 Scott Drive

Menlo Park, CA 94025 Attn: Brian J. Cuneo

Email: Brian.Cuneo@lw.com

 

--------------------------------------------------------------------------------

 

 

5.6Waiver. This Warrant and any term hereof may be changed, waived, discharged
or terminated (either generally or in a particular instance and either
retroactively or prospectively) only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought.

 

5.7Attorney’s Fees. In the event of any dispute between the parties concerning
the terms and provisions of this Warrant, the party prevailing in such dispute
shall be entitled to collect from the other party all costs incurred in such
dispute, including reasonable attorneys’ fees.

 

5.8Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed
in counterparts, all of which together shall constitute one and the same
agreement. Any signature page delivered electronically or by facsimile shall be
binding to the same extent as an original signature page with regards to any
agreement subject to the terms hereof or any amendment thereto.

 

5.9Governing Law. This Warrant shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to its principles
regarding conflicts of law.

 

5.10Headings. The headings in this Warrant are for purposes of reference only
and shall not limit or otherwise affect the meaning of any provision of this
Warrant.

 

5.11Business Days. “Business Day” is any day that is not a Saturday, Sunday or a
day on which banks in New York, New York are closed.

 

[Signature page follows]

 

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have caused this Warrant to Purchase Stock to be
executed by their duly authorized representatives effective as of the Issue Date
written above.

 

“COMPANY”

 

 

 

RESTORATION ROBOTICS, INC.

 

 

 

 

By:

 

 

Name:

Mark Hair

 

Title:

Chief Financial Officer

 

 

“HOLDER”

 

 

 

WESTERN ALLIANCE BANK

 

 

 

 

By:

 

 

Name:

 

 

Title:

 

 

 

 

 

--------------------------------------------------------------------------------

 

APPENDIX 1

 

 

NOTICE OF EXERCISE

 

 

1.The undersigned Holder hereby exercises its right
purchase                           shares of the Common/ Stock of Restoration
Robotics, Inc. (the “Company”) in accordance with the attached Warrant To
Purchase Stock, and tenders payment of the aggregate Warrant Price for such
shares as follows:

 

 

[   ]

check in the amount of $                  payable to order of the Company
enclosed herewith

 

 

[   ]

Wire transfer of immediately available funds to the Company’s account

 

[   ]

Cashless Exercise pursuant to Section 1.2 of the Warrant

 

[   ]

Other [Describe]
                                                                                           

 

2.Please issue a certificate or certificates representing the Shares in the name
specified below:

 

 

Holder’s Name

 

 

 

 

 

 

 

(Address)

 

3.By its execution below and for the benefit of the Company, Holder hereby
restates each of the representations and warranties in Section 4 of the Warrant
to Purchase Stock as of the date hereof.

 

 

 

HOLDER:

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

(Date):

 

 

 

 

 

Appendix 1

--------------------------------------------------------------------------------

 

APPENDIX 2 ASSIGNMENT

For value received, WESTERN ALLIANCE BANK, hereby sells, assigns and transfers
unto:

 

 

Name:

WESTERN ALLIANCE BANCORPORATION

 

Address:

One E. Washington, Suite 1400

Phoenix, Arizona 85004

Tax ID:

that certain Warrant to Purchase Stock issued by Restoration Robotics, Inc., a
Delaware corporation (the “Company”), on November 2, 2018 (the “Warrant”)
together with all rights, title and interest therein.

 

 

WESTERN ALLIANCE BANK

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

By its execution below, and for the benefit of the Company, Western Alliance
Bancorporation agrees to all other provisions of the Warrant as of the date
hereof.

 

 

WESTERN ALLIANCE BANCORPORATION

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

Schedule 1

 

--------------------------------------------------------------------------------

 

Execution Version

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED
UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY,
SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

WARRANT TO PURCHASE STOCK

 

Company:

Restoration Robotics, Inc.

Number of Shares:

32,345

Type/Series of Stock:

Common Stock, with par value of $0.0001 per share

Warrant Price:

$1.755 per share

Issue Date:

November 2, 2018

Expiration Date:

May 10, 2028 (See also Section 5.1(b))

Credit Facility:

This Warrant to Purchase Stock (“Warrant”) is issued in connection with that
certain Loan and Security Agreement of May 10, 2018 between the Holder (as
assignee of Solar Capital Ltd.) and the Company (as may be amended from time to
time, the “Loan Agreement”).

 

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, SCP Private
Credit Income Fund L.P. a Delaware limited partnership with an office located at
500 Park Avenue, 3rd Floor, New York, NY 10022 (together with any successor or
permitted assignee or transferee of this Warrant  or of any shares issued upon
exercise hereof, “Holder”) is entitled to purchase the number of fully paid and
non-assessable - (the “Shares”) of the above-stated Type/Series of Stock (the
“Class”) of the above- named company (the “Company”) at the above-stated Warrant
Price, all as set forth above and as adjusted pursuant to Section 2 of this
Warrant, subject to the provisions and upon the terms and conditions set forth
in this Warrant.

 

SECTION 1. EXERCISE.

 

1.1Method of Exercise. Holder may at any time and from time to time exercise
this Warrant, in whole or in part, by delivering to the Company the original of
this Warrant together with a duly executed Notice of Exercise in substantially
the form attached hereto as Appendix 1 and, unless Holder is exercising this
Warrant pursuant to a cashless exercise set forth in Section 1.2, a check, wire
transfer of same-day funds (to an account designated by the Company), or other
form of payment acceptable to the Company for the aggregate Warrant Price for
the Shares being purchased.

 

1.2Cashless Exercise. On any exercise of this Warrant, in lieu of payment of the
aggregate Warrant Price in the manner as specified in Section 1.1 above, but
otherwise in accordance with the requirements of Section 1.1, Holder may elect
to receive Shares equal to the value of this Warrant, or portion hereof as to
which this Warrant is being exercised. Thereupon, the Company shall issue to the
Holder such number of fully paid and non-assessable Shares as are computed using
the following formula:

 

X = Y(A-B)/A

 

where:

X = the number of Shares to be issued to the Holder;

 

Y = the number of Shares with respect to which this Warrant is being exercised
(inclusive of the Shares surrendered to the Company in payment of the aggregate
Warrant Price);

 

A = the Fair Market Value (as determined pursuant to Section 1.3 below) of one
Share; and

 

B = the Warrant Price.

 

--------------------------------------------------------------------------------

 

 

1.3Fair Market Value. If the Company’s common stock is then traded or quoted on
a nationally recognized securities exchange, inter-dealer quotation system or
over-the-counter market (a “Trading Market”), the fair market value of a Share
shall be the volume-weighted average closing price of a share of common stock
reported for the ten (10) Business Days immediately before the date on which
Holder delivers this Warrant together with its Notice of Exercise to the
Company. If the Company’s common stock is not traded in a Trading Market, the
Board of Directors of the Company shall determine the fair market value of a
Share in its reasonable good faith judgment.

 

1.4Delivery of Certificate and New Warrant. Promptly after Holder exercises this
Warrant in the manner set forth in Section 1.1 or 1.2 above, the Company shall
deliver to Holder a certificate representing the Shares issued to Holder upon
such exercise and, if this Warrant has not been fully exercised and has not
expired, a new warrant of like tenor representing the Shares not so acquired.

 

1.5Replacement of Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in
the case of loss, theft or destruction, on delivery of an indemnity agreement
reasonably satisfactory in form, substance and amount to the Company or, in the
case of mutilation, on surrender of this Warrant to the Company for
cancellation, the Company shall, within a reasonable time, execute and deliver
to Holder, in lieu of this Warrant, a new warrant of like tenor and amount.

 

1.6Treatment of Warrant Upon Acquisition of Company.

 

(a)Acquisition. For the purpose of this Warrant, “Acquisition” means
any  transaction or series of related transactions involving: (i) the sale,
lease, exclusive license, or other disposition of all or substantially all of
the assets of the Company (ii) any merger or consolidation of the Company into
or with another person or entity (other than a merger or consolidation effected
exclusively to change the Company’s domicile), or any other corporate
reorganization, in which the stockholders of the Company in their capacity as
such immediately prior to such merger, consolidation or reorganization, own less
than a majority of the Company’s (or the surviving or successor entity’s)
outstanding voting power immediately after such merger, consolidation or
reorganization; or (iii) any sale or other transfer by the stockholders of the
Company of shares representing at least a majority of the Company’s then-total
outstanding combined voting power.

 

(b)Treatment of Warrant at Acquisition. In the event of an Acquisition in which
the consideration to be received by the Company’s stockholders consists solely
of cash, solely of Marketable Securities or a combination of cash and Marketable
Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this
Warrant pursuant to Section 1.1 and/or 1.2 and such exercise will be deemed
effective immediately prior to and contingent upon the consummation of such
Acquisition or (ii) if Holder elects not to exercise the Warrant, this Warrant
will expire immediately prior to the consummation of such Acquisition.

 

(c)The Company shall provide Holder with written notice of its request relating
to the Cash/Public Acquisition (together with such reasonable information as
Holder may reasonably require regarding the treatment of this Warrant in
connection with such contemplated Cash/Public Acquisition giving rise to such
notice), which is to be delivered to Holder not less than five (5) Business Days
prior to the closing of the proposed Cash/Public Acquisition. Notwithstanding
the foregoing, if, immediately prior to the Cash/Public Acquisition, the fair
market value of one Share (or other security issuable upon the exercise hereof)
as determined in accordance with Section 1.3 above would be greater than the
Warrant Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be exercised pursuant to Section 1.2 above as
to all Shares (or such other securities) for which it shall not previously have
been exercised, and the Company shall promptly notify the Holder of the number
of Shares (or such other securities) issued upon such exercise to the Holder.

 

(d)Upon the closing of any Acquisition other than a Cash/Public Acquisition
defined above, the acquiring, surviving or successor entity shall assume the
obligations of this Warrant, and this Warrant shall thereafter be exercisable
for the same securities and/or other property as would have been paid for the
Shares issuable upon exercise of the unexercised portion of this Warrant as if
such Shares were outstanding on and as of the closing of such Acquisition,
subject to further adjustment from time to time in accordance with the
provisions of this Warrant.

 

 

--------------------------------------------------------------------------------

 

(e)As used in this Warrant, “Marketable Securities” means securities meeting all
of the following requirements: (i) the issuer thereof is then subject to the
reporting requirements of Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and is then current in its filing
of all required reports and other information under the Act and the Exchange
Act; (ii) the class and series of shares or other security of the issuer that
would be received by Holder in connection with the Acquisition were Holder to
exercise this Warrant on or prior to the closing thereof is then traded in
Trading Market, and (iii) Holder would be able to publicly re-sell, within six
(6) months following the closing of such Acquisition, all of the issuer’s shares
and/or other securities that would be received by Holder in such Acquisition
were Holder to exercise this Warrant in full on or prior to the closing of such
Acquisition.

 

1.7Registration Rights. As to any Shares Holder receives or is entitled to
receive upon any exercise or conversion of this Warrant, Holder shall be
entitled to such demand registration rights and such piggyback registration
rights as are commensurate with such registration rights are set forth in that
certain Investors’ Rights Agreement, dated as of February 7, 2013 by and among
the Company and certain of the Company’s stockholders, as the same may be
amended from time to time, or similar agreement (the “Investors’ Rights
Agreement”).

 

SECTION 2. ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.

 

2.1Stock Dividends, Splits, Etc. If the Company declares or pays a dividend or
distribution on the outstanding shares of the Class payable in common stock or
other securities or property (other than cash), then upon exercise of this
Warrant, for each Share acquired, Holder shall receive, without additional cost
to Holder, the total number and kind of securities and property which Holder
would have received had Holder owned the Shares of record as of the date the
dividend or distribution occurred. If the Company subdivides the outstanding
shares of the Class by reclassification or otherwise into a greater number of
shares, the number of Shares purchasable hereunder shall be proportionately
increased and the Warrant Price shall be proportionately decreased. If the
outstanding shares of the Class are combined or consolidated, by
reclassification or otherwise, into a lesser number of shares, the Warrant Price
shall be proportionately increased and the number of Shares shall be
proportionately decreased.

 

2.2Reclassification, Exchange, Combinations or Substitution. Upon any event
whereby all of the outstanding shares of the Class are reclassified, exchanged,
combined, substituted, or replaced for, into, with or by Company securities of a
different class and/or series, then from and after the consummation of such
event, this Warrant will be exercisable for the number, class and series of
Company securities that Holder would have received had the Shares been
outstanding on and as of the consummation of such event, and subject to further
adjustment thereafter from time to time in accordance with the provisions of
this Warrant. The provisions of this Section 2.2 shall similarly apply to
successive reclassifications, exchanges, combinations substitutions,
replacements or other similar events.

 

2.3No Fractional Share. No fractional Share shall be issuable upon exercise of
this Warrant and the number of Shares to be issued shall be rounded down to the
nearest whole Share. If a fractional Share interest arises upon any exercise of
the Warrant, the Company shall eliminate such fractional Share interest by
paying Holder in cash the amount computed by multiplying the fractional interest
by (i) the fair market value (as determined in accordance with Section 1.3
above) of a full Share, less (ii) the then-effective Warrant Price.

 

2.4Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant
Price, Class and/or number of Shares, the Company, at the Company’s expense,
shall notify Holder in writing within a reasonable time setting forth the
adjustments to the Warrant Price, Class and/or number of Shares and facts upon
which such adjustment is based. The Company shall, upon written request from
Holder, furnish Holder with a certificate of its Chief Financial Officer,
including computations of such adjustment and the Warrant Price, Class and
number of Shares in effect upon the date of such adjustment.

 

 

--------------------------------------------------------------------------------

 

SECTION 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

 

3.1Representations and Warranties. The Company represents and warrants to, and
agrees with, the Holder as follows:

 

(a)The initial Warrant Price referenced on the first page of this Warrant is
equal to the lesser of (a) the ten (10) day trailing average of the Company’s
common stock price, as determined as of the close of business on the business
day immediately prior to the Issue Date, and (b) the Company’s common stock
price, as determined as of the close of business on the business day immediately
prior to the Issue Date.

 

(b)All Shares which may be issued upon the exercise of this Warrant, shall, upon
issuance, be duly authorized, validly issued, fully paid and non-assessable, and
free of any liens and encumbrances except for restrictions on transfer provided
for herein or under applicable federal and state securities laws. The Company
covenants that it shall at all times cause to be reserved and kept available out
of its authorized and unissued capital stock such number of shares of the Class,
common stock and other securities as will be sufficient to permit the exercise
in full of this Warrant.

 

3.2Notice of Certain Events. If the Company proposes at any time to:

 

(a)declare any dividend or distribution upon the outstanding shares of the Class
or common stock, whether in cash, property, stock, or other securities and
whether or not a regular cash dividend;

 

(c)effect any reclassification, exchange, combination, substitution,
reorganization or recapitalization of the outstanding shares of the Class; or

 

(d)effect an Acquisition or to liquidate, dissolve or wind up. then, in
connection with each such event, the Company shall give Holder:

 

(1)at least five (5) Business Days prior written notice of the date on which a
record will be taken for such dividend, distribution, or subscription rights
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled thereto) or for determining rights to vote, if any, in respect
of the matters referred to in (a) and (b) above; and

 

(2)in the case of the matters referred to in (c) and (d) above at least five (5)
Business Days prior written notice of the date when the same will take place
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled to exchange their shares for the securities or other property
deliverable upon the occurrence of such event).

 

Reference is made to Section 1.6(c) whereby this Warrant will be deemed to be
exercised pursuant to Section 1.2 hereof if the Company does not give written
notice to Holder of a Cash/Public Acquisition as required by the terms hereof.
Company will also provide information requested by Holder that is reasonably
necessary to enable Holder to comply with Holder’s accounting or reporting
requirements.

 

SECTION 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER.

 

The Holder represents and warrants to the Company as follows:

 

4.1Purchase for Own Account. This Warrant and the securities to be acquired upon
exercise of this Warrant by Holder are being acquired for investment for
Holder’s account, not as a nominee or agent, and not with a view to the public
resale or distribution within the meaning of the Act. Holder also represents
that it has not been formed for the specific purpose of acquiring this Warrant
or the Shares.

 

 

--------------------------------------------------------------------------------

 

4.2Disclosure of Information. Holder is aware of the Company’s business affairs
and financial condition and has received or has had full access to all the
information it considers necessary or appropriate to make an informed investment
decision with respect to the acquisition of this Warrant and its underlying
securities. Holder further has had an opportunity to ask questions and  receive
answers from the Company regarding the terms and conditions of the offering of
this Warrant and its underlying securities and to obtain additional information
(to the extent the Company possessed such information or could acquire it
without unreasonable effort or expense) necessary to verify any information
furnished to Holder or to which Holder has access.

 

4.3Investment Experience. Holder understands that the purchase of this Warrant
and its underlying securities involves substantial risk. Holder has experience
as an investor in securities of companies in the development stage and
acknowledges that Holder can bear the economic risk of such Holder’s investment
in this Warrant and its underlying securities and has such knowledge and
experience in financial or business matters that Holder is capable of evaluating
the merits and risks of its investment in this Warrant and its underlying
securities and/or has a preexisting personal or business relationship with the
Company and certain of its officers, directors or controlling persons of a
nature and duration that enables Holder to be aware of the character, business
acumen and financial circumstances of such persons.

 

4.4Accredited Investor Status. Holder is an “accredited investor” within the
meaning of Regulation D promulgated under the Act.

 

4.5The Act. Holder understands that this Warrant and the Shares issuable upon
exercise hereof have not been registered under the Act in reliance upon a
specific exemption therefrom, which exemption depends upon, among other things,
the bona fide nature of the Holder’s investment intent as expressed herein.
Holder understands that this Warrant and the Shares issued upon any exercise
hereof must be held indefinitely unless subsequently registered under the Act
and qualified under applicable state securities laws, or unless exemption from
such registration and qualification are otherwise available. Holder is aware of
the provisions of Rule 144 promulgated under the Act.

 

4.6Reserved.

 

4.7No Voting Rights. Holder, as a Holder of this Warrant, will not have any
voting rights until the exercise of this Warrant.

 

SECTION 5. MISCELLANEOUS.

 

5.1Term and Automatic Conversion Upon Expiration.

 

(a)Term. Subject to the provisions of Section 1.6 above, this Warrant is
exercisable in whole or in part at any time and from time to time on or before
6:00 PM, Pacific time, on the Expiration Date and shall be void thereafter.

 

(b)Automatic Cashless Exercise upon Expiration. In the event that, upon the
Expiration Date, the fair market value of one Share (or other security issuable
upon the exercise hereof) as determined in accordance with Section 1.3 above is
greater than the Warrant Price in effect on such date, then this Warrant shall
automatically be deemed on and as of such date to be exercised pursuant to
Section 1.2 above as to all Shares (or such other securities) for which it shall
not previously have been exercised, and the Company shall, within a reasonable
time, deliver a certificate representing the Shares (or such other securities)
issued upon such exercise to Holder.

 

5.2Legends. The Shares shall be imprinted with a legend in substantially the
following form:

 

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY
STATE AND, EXCEPT AS SET FORTH IN THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED
BY THE ISSUER TO SCP PRIVATE CREDIT INCOME FUND L.P. DATED NOVEMBER 2, 2018, MAY
NOT BE OFFERED, SOLD, PLEDGED OR

 

--------------------------------------------------------------------------------

 

OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR IN
FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE, PLEDGE OR OTHER
TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

5.3Compliance with Securities Laws on Transfer. This Warrant and the Shares
issuable upon exercise of this Warrant may not be transferred or assigned in
whole or in part except in compliance with applicable federal and state
securities laws by the transferor and the transferee (including, without
limitation, the delivery of investment representation letters and legal opinions
reasonably satisfactory to the Company, as reasonably requested by the Company).
The Company shall not require Holder to provide an opinion of counsel if the
transfer is to any entity under common management control with Holder, or any
affiliate of Holder, provided that any such transferee is an “accredited
investor” as defined in Regulation D promulgated under the Act. Additionally,
the Company shall also not require an opinion of counsel if there is no material
question as to the availability of Rule 144 promulgated under the Act.

 

5.4Transfer Procedure. After receipt by Holder of the executed Warrant, Holder
may transfer all of this Warrant to any entity under common management control
with Holder, or an affiliate thereof or successor thereto (the “Subsequent
Holder”), by execution of an Assignment substantially in the form of Appendix 2.
Subject to the provisions of Section 5.3 and upon providing the Company with
written notice, Subsequent Holder may transfer all or part of this Warrant or
the Shares issuable upon exercise of this Warrant to any transferee, provided,
however, in connection with any such transfer, the Subsequent Holder will give
the Company notice of the portion of the Warrant being transferred with the
name, address and taxpayer identification number of the transferee and Holder
will surrender this Warrant to the Company for reissuance to the transferee(s)
(and Holder if applicable); and provided further, that any subsequent transferee
shall agree in writing with the Company to be bound by all of the terms and
conditions of this Warrant.

 

5.5Notices. All notices and other communications hereunder from the Company to
the Holder, or vice versa, shall be deemed delivered and effective (i) when
given personally, (ii) on the third (3rd) Business Day after being mailed by
first-class registered or certified mail, postage prepaid, (iii) upon actual
receipt if given by facsimile or electronic mail and such receipt is confirmed
in writing by the recipient, or (iv) on the first Business Day following
delivery to a reliable overnight courier service, courier fee prepaid, in any
case at such address as may have been furnished to the Company or Holder, as the
case may be, in writing by the Company or such Holder from time to time in
accordance with the provisions of this Section 5.5. All notices to Holder shall
be addressed as follows until the Company receives notice of a change of address
in connection with a transfer or otherwise:

 

SCP Private Credit Income Fund L.P.

c/o Solar Capital Ltd.

500 Park Avenue, 3rd Floor

New York, NY 10022

Attn: Anthony Storino

Telephone: (646) 308 - 8730

Fax: (212) 993-1698

Email: storino@solarcapltd.com

With a copy (which shall not constitute notice) to:

 

Baker Botts L.L.P.

101 California Street, Suite 3600 San Francisco, CA 94111

Attn: Jeff Kayes Fax: (415) 291-6331

Email: jeff.kayes@bakerbotts.com

 

Notice to the Company shall be addressed as follows until Holder receives notice
of a change in address:

 

Restoration Robotics, Inc. 128 Baytech Drive

San Jose, CA

Attn: Chief Financial Officer

 

--------------------------------------------------------------------------------

 

Email: markh@restorationrobotics.com

 

With a copy (which shall not constitute notice) to:

 

Latham & Watkins LLP 140 Scott Drive

Menlo Park, CA 94025 Attn: Brian J. Cuneo

Email: Brian.Cuneo@lw.com

 

5.6Waiver. This Warrant and any term hereof may be changed, waived, discharged
or terminated (either generally or in a particular instance and either
retroactively or prospectively) only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought.

 

5.7Attorney’s Fees. In the event of any dispute between the parties concerning
the terms and provisions of this Warrant, the party prevailing in such dispute
shall be entitled to collect from the other party all costs incurred in such
dispute, including reasonable attorneys’ fees.

 

5.8Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed
in counterparts, all of which together shall constitute one and the same
agreement. Any signature page delivered electronically or by facsimile shall be
binding to the same extent as an original signature page with regards to any
agreement subject to the terms hereof or any amendment thereto.

 

5.9Governing Law. This Warrant shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to its principles
regarding conflicts of law.

 

5.10Headings. The headings in this Warrant are for purposes of reference only
and shall not limit or otherwise affect the meaning of any provision of this
Warrant.

 

5.11Business Days. “Business Day” is any day that is not a Saturday, Sunday or a
day on which banks in New York, New York are closed.

 

[Signature page follows]

 

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have caused this Warrant to Purchase Stock to be
executed by their duly authorized representatives effective as of the Issue Date
written above.

 

 

“COMPANY”

 

 

 

RESTORATION ROBOTICS, INC.

 

 

 

 

By:

 

 

Name:

Mark Hair

 

Title:

Chief Financial Officer

 

 

 

“HOLDER”

 

 

 

SCP PRIVATE CREDIT INCOME FUND L.P.

 

 

 

 

By:

 

 

Name:

Richard Peteka

 

Title:

Authorized Signatory

 

 

 

 

--------------------------------------------------------------------------------

 

APPENDIX 1

 

 

NOTICE OF EXERCISE

 

 

1.The undersigned Holder hereby exercises its right purchase
                            shares of the Common/ Stock of Restoration Robotics,
Inc. (the “Company”) in accordance with the attached Warrant To Purchase Stock,
and tenders payment of the aggregate Warrant Price for such shares as follows:

 

 

[   ]

check in the amount of $                  payable to order of the Company
enclosed herewith

 

 

[   ]

Wire transfer of immediately available funds to the Company’s account

 

[   ]

Cashless Exercise pursuant to Section 1.2 of the Warrant

 

[   ]

Other [Describe]
                                                                                           

 

2.Please issue a certificate or certificates representing the Shares in the name
specified below:

 

 

Holder’s Name

 

 

 

 

 

 

 

(Address)

 

3.By its execution below and for the benefit of the Company, Holder hereby
restates each of the representations and warranties in Section 4 of the Warrant
to Purchase Stock as of the date hereof.

 

 

HOLDER:

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

(Date):

 

 

 

 

 

Appendix 1

--------------------------------------------------------------------------------

 

APPENDIX 2 ASSIGNMENT

For value received, SCP Private Credit Income Fund L.P., hereby sells, assigns
and transfers unto:

 

 

Name:

[                                           ]

 

Address:

[                                    ]

[                                    ]

Tax ID: [                  ]

 

that certain Warrant to Purchase Stock issued by Restoration Robotics, Inc., a
Delaware corporation (the “Company”), on November 2, 2018 (the “Warrant”)
together with all rights, title and interest therein.

 

 

 

 

SCP PRIVATE CREDIT INCOME FUND L.P.

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

By its execution below, and for the benefit of the Company, [
                           ] agrees to all other provisions of the Warrant as of
the date hereof.

 

 

[        ]

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

--------------------------------------------------------------------------------

 

Execution Version

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED
UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY,
SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

WARRANT TO PURCHASE STOCK

 

Company:

Restoration Robotics, Inc.

Number of Shares:

72,776

Type/Series of Stock:

Common Stock, with par value of $0.0001 per share

Warrant Price:

$1.755 per share

Issue Date:

November 2, 2018

Expiration Date:

May 10, 2028 (See also Section 5.1(b))

Credit Facility:

This Warrant to Purchase Stock (“Warrant”) is issued in connection with that
certain Loan and Security Agreement of May 10, 2018, between the Holder and the
Company (as may be amended from time to time, the “Loan Agreement”).

 

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, Solar Capital
Ltd., a Maryland corporation with an office located at 500 Park Avenue, 3rd
Floor, New York, NY 10022 (together with any successor or permitted assignee or
transferee of this Warrant or of any shares issued upon exercise hereof,
“Holder”) is entitled to purchase the number of fully paid and non-assessable -
(the “Shares”) of the above-stated Type/Series of Stock (the “Class”) of the
above-named company (the “Company”) at the above-stated Warrant Price, all as
set forth above and as adjusted pursuant to Section 2 of this Warrant, subject
to the provisions and upon the terms and conditions set forth in this Warrant.

 

SECTION 1. EXERCISE.

 

1.1Method of Exercise. Holder may at any time and from time to time exercise
this Warrant, in whole or in part, by delivering to the Company the original of
this Warrant together with a duly executed Notice of Exercise in substantially
the form attached hereto as Appendix 1 and, unless Holder is exercising this
Warrant pursuant to a cashless exercise set forth in Section 1.2, a check, wire
transfer of same-day funds (to an account designated by the Company), or other
form of payment acceptable to the Company for the aggregate Warrant Price for
the Shares being purchased.

 

1.2Cashless Exercise. On any exercise of this Warrant, in lieu of payment of the
aggregate Warrant Price in the manner as specified in Section 1.1 above, but
otherwise in accordance with the requirements of Section 1.1, Holder may elect
to receive Shares equal to the value of this Warrant, or portion hereof as to
which this Warrant is being exercised. Thereupon, the Company shall issue to the
Holder such number of fully paid and non-assessable Shares as are computed using
the following formula:

 

X = Y(A-B)/A

 

where:

X = the number of Shares to be issued to the Holder;

Y = the number of Shares with respect to which this Warrant is being exercised
(inclusive of the Shares surrendered to the Company in payment of the aggregate
Warrant Price);

 

A = the Fair Market Value (as determined pursuant to Section 1.3 below) of   one
Share; and

 

B = the Warrant Price.

 

 

--------------------------------------------------------------------------------

 

1.3Fair Market Value. If the Company’s common stock is then traded or quoted on
a nationally recognized securities exchange, inter-dealer quotation system or
over-the-counter market (a “Trading Market”), the fair market value of a Share
shall be the volume-weighted average closing price of a share of common stock
reported for the ten (10) Business Days immediately before the date on which
Holder delivers this Warrant together with its Notice of Exercise to the
Company. If the Company’s common stock is not traded in a Trading Market, the
Board of Directors of the Company shall determine the fair market value of a
Share in its reasonable good faith judgment.

 

1.4Delivery of Certificate and New Warrant. Promptly after Holder exercises this
Warrant in the manner set forth in Section 1.1 or 1.2 above, the Company shall
deliver to Holder a certificate representing the Shares issued to Holder upon
such exercise and, if this Warrant has not been fully exercised and has not
expired, a new warrant of like tenor representing the Shares not so acquired.

 

1.5Replacement of Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in
the case of loss, theft or destruction, on delivery of an indemnity agreement
reasonably satisfactory in form, substance and amount to the Company or, in the
case of mutilation, on surrender of this Warrant to the Company for
cancellation, the Company shall, within a reasonable time, execute and deliver
to Holder, in lieu of this Warrant, a new warrant of like tenor and amount.

 

1.6Treatment of Warrant Upon Acquisition of Company.

 

(a)Acquisition. For the purpose of this Warrant, “Acquisition” means
any  transaction or series of related transactions involving: (i) the sale,
lease, exclusive license, or other disposition of all or substantially all of
the assets of the Company (ii) any merger or consolidation of the Company into
or with another person or entity (other than a merger or consolidation effected
exclusively to change the Company’s domicile), or any other corporate
reorganization, in which the stockholders of the Company in their capacity as
such immediately prior to such merger, consolidation or reorganization, own less
than a majority of the Company’s (or the surviving or successor entity’s)
outstanding voting power immediately after such merger, consolidation or
reorganization; or (iii) any sale or other transfer by the stockholders of the
Company of shares representing at least a majority of the Company’s then-total
outstanding combined voting power.

 

(b)Treatment of Warrant at Acquisition. In the event of an Acquisition in which
the consideration to be received by the Company’s stockholders consists solely
of cash, solely of Marketable Securities or a combination of cash and Marketable
Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this
Warrant pursuant to Section 1.1 and/or 1.2 and such exercise will be deemed
effective immediately prior to and contingent upon the consummation of such
Acquisition or (ii) if Holder elects not to exercise the Warrant, this Warrant
will expire immediately prior to the consummation of such Acquisition.

 

(c)The Company shall provide Holder with written notice of its request relating
to the Cash/Public Acquisition (together with such reasonable information as
Holder may reasonably require regarding the treatment of this Warrant in
connection with such contemplated Cash/Public Acquisition giving rise to such
notice), which is to be delivered to Holder not less than five (5) Business Days
prior to the closing of the proposed Cash/Public Acquisition. Notwithstanding
the foregoing, if, immediately prior to the Cash/Public Acquisition, the fair
market value of one Share (or other security issuable upon the exercise hereof)
as determined in accordance with Section 1.3 above would be greater than the
Warrant Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be exercised pursuant to Section 1.2 above as
to all Shares (or such other securities) for which it shall not previously have
been exercised, and the Company shall promptly notify the Holder of the number
of Shares (or such other securities) issued upon such exercise to the Holder.

 

(d)Upon the closing of any Acquisition other than a Cash/Public Acquisition
defined above, the acquiring, surviving or successor entity shall assume the
obligations of this Warrant, and this Warrant shall thereafter be exercisable
for the same securities and/or other property as would have been paid for the
Shares issuable upon exercise of the unexercised portion of this Warrant as if
such Shares were outstanding on and as of the closing of such Acquisition,
subject to further adjustment from time to time in accordance with the
provisions of this Warrant.

 

 

--------------------------------------------------------------------------------

 

(e)As used in this Warrant, “Marketable Securities” means securities meeting all
of the following requirements: (i) the issuer thereof is then subject to the
reporting requirements of Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and is then current in its filing
of all required reports and other information under the Act and the Exchange
Act; (ii) the class and series of shares or other security of the issuer that
would be received by Holder in connection with the Acquisition were Holder to
exercise this Warrant on or prior to the closing thereof is then traded in
Trading Market, and (iii) Holder would be able to publicly re-sell, within six
(6) months following the closing of such Acquisition, all of the issuer’s shares
and/or other securities that would be received by Holder in such Acquisition
were Holder to exercise this Warrant in full on or prior to the closing of such
Acquisition.

 

1.7Registration Rights. As to any Shares Holder receives or is entitled to
receive upon any exercise or conversion of this Warrant, Holder shall be
entitled to such demand registration rights and such piggyback registration
rights as are commensurate with such registration rights are set forth in that
certain Investors’ Rights Agreement, dated as of February 7, 2013 by and among
the Company and certain of the Company’s stockholders, as the same may be
amended from time to time, or similar agreement (the “Investors’ Rights
Agreement”).

 

SECTION 2. ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.

 

2.1Stock Dividends, Splits, Etc. If the Company declares or pays a dividend or
distribution on the outstanding shares of the Class payable in common stock or
other securities or property (other than cash), then upon exercise of this
Warrant, for each Share acquired, Holder shall receive, without additional cost
to Holder, the total number and kind of securities and property which Holder
would have received had Holder owned the Shares of record as of the date the
dividend or distribution occurred. If the Company subdivides the outstanding
shares of the Class by reclassification or otherwise into a greater number of
shares, the number of Shares purchasable hereunder shall be proportionately
increased and the Warrant Price shall be proportionately decreased. If the
outstanding shares of the Class are combined or consolidated, by
reclassification or otherwise, into a lesser number of shares, the Warrant Price
shall be proportionately increased and the number of Shares shall be
proportionately decreased.

 

2.2Reclassification, Exchange, Combinations or Substitution. Upon any event
whereby all of the outstanding shares of the Class are reclassified, exchanged,
combined, substituted, or replaced for, into, with or by Company securities of a
different class and/or series, then from and after the consummation of such
event, this Warrant will be exercisable for the number, class and series of
Company securities that Holder would have received had the Shares been
outstanding on and as of the consummation of such event, and subject to further
adjustment thereafter from time to time in accordance with the provisions of
this Warrant. The provisions of this Section 2.2 shall similarly apply to
successive reclassifications, exchanges, combinations substitutions,
replacements or other similar events.

 

2.3No Fractional Share. No fractional Share shall be issuable upon exercise of
this Warrant and the number of Shares to be issued shall be rounded down to the
nearest whole Share. If a fractional Share interest arises upon any exercise of
the Warrant, the Company shall eliminate such fractional Share interest by
paying Holder in cash the amount computed by multiplying the fractional interest
by (i) the fair market value (as determined in accordance with Section 1.3
above) of a full Share, less (ii) the then-effective Warrant Price.

 

2.4Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant
Price, Class and/or number of Shares, the Company, at the Company’s expense,
shall notify Holder in writing within a reasonable time setting forth the
adjustments to the Warrant Price, Class and/or number of Shares and facts upon
which such adjustment is based. The Company shall, upon written request from
Holder, furnish Holder with a certificate of its Chief Financial Officer,
including computations of such adjustment and the Warrant Price, Class and
number of Shares in effect upon the date of such adjustment.

 

 

--------------------------------------------------------------------------------

 

SECTION 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

 

3.1Representations and Warranties. The Company represents and warrants to, and
agrees with, the Holder as follows:

 

(a)The initial Warrant Price referenced on the first page of this Warrant is
equal to the lesser of (a) the ten (10) day trailing average of the Company’s
common stock price, as determined as of the close of business on the business
day immediately prior to the Issue Date, and (b) the Company’s common stock
price, as determined as of the close of business on the business day immediately
prior to the Issue Date.

 

(b)All Shares which may be issued upon the exercise of this Warrant, shall, upon
issuance, be duly authorized, validly issued, fully paid and non-assessable, and
free of any liens and encumbrances except for restrictions on transfer provided
for herein or under applicable federal and state securities laws. The Company
covenants that it shall at all times cause to be reserved and kept available out
of its authorized and unissued capital stock such number of shares of the Class,
common stock and other securities as will be sufficient to permit the exercise
in full of this Warrant.

 

3.2Notice of Certain Events. If the Company proposes at any time to:

 

(a)declare any dividend or distribution upon the outstanding shares of the Class
or common stock, whether in cash, property, stock, or other securities and
whether or not a regular cash dividend;

 

(c)effect any reclassification, exchange, combination, substitution,
reorganization or recapitalization of the outstanding shares of the Class; or

 

(d)effect an Acquisition or to liquidate, dissolve or wind up. then, in
connection with each such event, the Company shall give Holder:

 

(1)at least five (5) Business Days prior written notice of the date on which a
record will be taken for such dividend, distribution, or subscription rights
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled thereto) or for determining rights to vote, if any, in respect
of the matters referred to in (a) and (b) above; and

 

(2)in the case of the matters referred to in (c) and (d) above at least five (5)
Business Days prior written notice of the date when the same will take place
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled to exchange their shares for the securities or other property
deliverable upon the occurrence of such event).

 

Reference is made to Section 1.6(c) whereby this Warrant will be deemed to be
exercised pursuant to Section 1.2 hereof if the Company does not give written
notice to Holder of a Cash/Public Acquisition as required by the terms hereof.
Company will also provide information requested by Holder that is reasonably
necessary to enable Holder to comply with Holder’s accounting or reporting
requirements.

 

SECTION 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER.

 

The Holder represents and warrants to the Company as follows:

 

4.1Purchase for Own Account. This Warrant and the securities to be acquired upon
exercise of this Warrant by Holder are being acquired for investment for
Holder’s account, not as a nominee or agent, and not with a view to the public
resale or distribution within the meaning of the Act. Holder also represents
that it has not been formed for the specific purpose of acquiring this Warrant
or the Shares.

 

 

--------------------------------------------------------------------------------

 

4.2Disclosure of Information. Holder is aware of the Company’s business affairs
and financial condition and has received or has had full access to all the
information it considers necessary or appropriate to make an informed investment
decision with respect to the acquisition of this Warrant and its underlying
securities. Holder further has had an opportunity to ask questions and  receive
answers from the Company regarding the terms and conditions of the offering of
this Warrant and its underlying securities and to obtain additional information
(to the extent the Company possessed such information or could acquire it
without unreasonable effort or expense) necessary to verify any information
furnished to Holder or to which Holder has access.

 

4.3Investment Experience. Holder understands that the purchase of this Warrant
and its underlying securities involves substantial risk. Holder has experience
as an investor in securities of companies in the development stage and
acknowledges that Holder can bear the economic risk of such Holder’s investment
in this Warrant and its underlying securities and has such knowledge and
experience in financial or business matters that Holder is capable of evaluating
the merits and risks of its investment in this Warrant and its underlying
securities and/or has a preexisting personal or business relationship with the
Company and certain of its officers, directors or controlling persons of a
nature and duration that enables Holder to be aware of the character, business
acumen and financial circumstances of such persons.

 

4.4Accredited Investor Status. Holder is an “accredited investor” within the
meaning of Regulation D promulgated under the Act.

 

4.5The Act. Holder understands that this Warrant and the Shares issuable upon
exercise hereof have not been registered under the Act in reliance upon a
specific exemption therefrom, which exemption depends upon, among other things,
the bona fide nature of the Holder’s investment intent as expressed herein.
Holder understands that this Warrant and the Shares issued upon any exercise
hereof must be held indefinitely unless subsequently registered under the Act
and qualified under applicable state securities laws, or unless exemption from
such registration and qualification are otherwise available. Holder is aware of
the provisions of Rule 144 promulgated under the Act.

 

4.6Reserved.

 

4.7No Voting Rights. Holder, as a Holder of this Warrant, will not have any
voting rights until the exercise of this Warrant.

 

SECTION 5. MISCELLANEOUS.

 

5.1Term and Automatic Conversion Upon Expiration.

 

(a)Term. Subject to the provisions of Section 1.6 above, this Warrant is
exercisable in whole or in part at any time and from time to time on or before
6:00 PM, Pacific time, on the Expiration Date and shall be void thereafter.

 

(b)Automatic Cashless Exercise upon Expiration. In the event that, upon the
Expiration Date, the fair market value of one Share (or other security issuable
upon the exercise hereof) as determined in accordance with Section 1.3 above is
greater than the Warrant Price in effect on such date, then this Warrant shall
automatically be deemed on and as of such date to be exercised pursuant to
Section 1.2 above as to all Shares (or such other securities) for which it shall
not previously have been exercised, and the Company shall, within a reasonable
time, deliver a certificate representing the Shares (or such other securities)
issued upon such exercise to Holder.

 

5.2Legends. The Shares shall be imprinted with a legend in substantially the
following form:

 

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY
STATE AND, EXCEPT AS SET FORTH IN THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED
BY THE ISSUER TO SOLAR CAPITAL LTD. DATED NOVEMBER 2, 2018, MAY NOT BE OFFERED,
SOLD, PLEDGED OR OTHERWISE

 

--------------------------------------------------------------------------------

 

TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND LAWS OR IN FORM AND
SUBSTANCE SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER
IS EXEMPT FROM SUCH REGISTRATION.

 

5.3Compliance with Securities Laws on Transfer. This Warrant and the Shares
issuable upon exercise of this Warrant may not be transferred or assigned in
whole or in part except in compliance with applicable federal and state
securities laws by the transferor and the transferee (including, without
limitation, the delivery of investment representation letters and legal opinions
reasonably satisfactory to the Company, as reasonably requested by the Company).
The Company shall not require Holder to provide an opinion of counsel if the
transfer is to any entity under common management control with Holder, or any
affiliate of Holder, provided that any such transferee is an “accredited
investor” as defined in Regulation D promulgated under the Act. Additionally,
the Company shall also not require an opinion of counsel if there is no material
question as to the availability of Rule 144 promulgated under the Act.

 

5.4Transfer Procedure. After receipt by Holder of the executed Warrant, Holder
may transfer all of this Warrant to any entity under common management control
with Holder, or an affiliate thereof or successor thereto (the “Subsequent
Holder”), by execution of an Assignment substantially in the form of Appendix 2.
Subject to the provisions of Section 5.3 and upon providing the Company with
written notice, Subsequent Holder may transfer all or part of this Warrant or
the Shares issuable upon exercise of this Warrant to any transferee, provided,
however, in connection with any such transfer, the Subsequent Holder will give
the Company notice of the portion of the Warrant being transferred with the
name, address and taxpayer identification number of the transferee and Holder
will surrender this Warrant to the Company for reissuance to the transferee(s)
(and Holder if applicable); and provided further, that any subsequent transferee
shall agree in writing with the Company to be bound by all of the terms and
conditions of this Warrant.

 

5.5Notices. All notices and other communications hereunder from the Company to
the Holder, or vice versa, shall be deemed delivered and effective (i) when
given personally, (ii) on the third (3rd) Business Day after being mailed by
first-class registered or certified mail, postage prepaid, (iii) upon actual
receipt if given by facsimile or electronic mail and such receipt is confirmed
in writing by the recipient, or (iv) on the first Business Day following
delivery to a reliable overnight courier service, courier fee prepaid, in any
case at such address as may have been furnished to the Company or Holder, as the
case may be, in writing by the Company or such Holder from time to time in
accordance with the provisions of this Section 5.5. All notices to Holder shall
be addressed as follows until the Company receives notice of a change of address
in connection with a transfer or otherwise:

 

Solar Capital Ltd.

500 Park Avenue, 3rd Floor

New York, NY 10022

Attn: Anthony Storino

Telephone: (646) 308 - 8730

Fax: (212) 993-1698

Email: storino@solarcapltd.com

With a copy (which shall not constitute notice) to:

 

Baker Botts L.L.P.

101 California Street, Suite 3600 San Francisco, CA 94111

Attn: Jeff Kayes Fax: (415) 291-6331

Email: jeff.kayes@bakerbotts.com

 

Notice to the Company shall be addressed as follows until Holder receives notice
of a change in address:

 

Restoration Robotics, Inc. 128 Baytech Drive

San Jose, CA

Attn: Chief Financial Officer

Email: markh@restorationrobotics.com

 

--------------------------------------------------------------------------------

 

 

With a copy (which shall not constitute notice) to:

 

Latham & Watkins LLP 140 Scott Drive

Menlo Park, CA 94025 Attn: Brian J. Cuneo

Email: Brian.Cuneo@lw.com

 

5.6Waiver. This Warrant and any term hereof may be changed, waived, discharged
or terminated (either generally or in a particular instance and either
retroactively or prospectively) only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought.

 

5.7Attorney’s Fees. In the event of any dispute between the parties concerning
the terms and provisions of this Warrant, the party prevailing in such dispute
shall be entitled to collect from the other party all costs incurred in such
dispute, including reasonable attorneys’ fees.

 

5.8Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed
in counterparts, all of which together shall constitute one and the same
agreement. Any signature page delivered electronically or by facsimile shall be
binding to the same extent as an original signature page with regards to any
agreement subject to the terms hereof or any amendment thereto.

 

5.9Governing Law. This Warrant shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to its principles
regarding conflicts of law.

 

5.10Headings. The headings in this Warrant are for purposes of reference only
and shall not limit or otherwise affect the meaning of any provision of this
Warrant.

 

5.11Business Days. “Business Day” is any day that is not a Saturday, Sunday or a
day on which banks in New York, New York are closed.

 

[Signature page follows]

 

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have caused this Warrant to Purchase Stock to be
executed by their duly authorized representatives effective as of the Issue Date
written above.

 

“COMPANY”

 

 

 

RESTORATION ROBOTICS, INC.

 

 

 

 

By:

 

 

Name:

Mark Hair

 

Title:

Chief Financial Officer

 

“HOLDER”

 

 

 

SOLAR CAPITAL LTD.

 

 

 

 

By:

 

 

Name:

Anthony Storino

 

Title:

Authorized Signatory

 

 

 

 

--------------------------------------------------------------------------------

 

APPENDIX 1

 

 

NOTICE OF EXERCISE

 

 

1.The undersigned Holder hereby exercises its right
purchase                                shares of the Common/ Stock of
Restoration Robotics, Inc. (the “Company”) in accordance with the attached
Warrant To Purchase Stock, and tenders payment of the aggregate Warrant Price
for such shares as follows:

 

 

[   ]

check in the amount of $                  payable to order of the Company
enclosed herewith

 

 

[   ]

Wire transfer of immediately available funds to the Company’s account

 

[   ]

Cashless Exercise pursuant to Section 1.2 of the Warrant

 

[   ]

Other [Describe]
                                                                                           

 

2.Please issue a certificate or certificates representing the Shares in the name
specified below:

 

 

Holder’s Name

 

 

 

 

 

 

 

(Address)

 

3.By its execution below and for the benefit of the Company, Holder hereby
restates each of the representations and warranties in Section 4 of the Warrant
to Purchase Stock as of the date hereof.

 

 

HOLDER:

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

(Date):

 

 

 

 

Appendix 1

--------------------------------------------------------------------------------

 

APPENDIX 2 ASSIGNMENT

For value received, SOLAR CAPITAL LTD., hereby sells, assigns and transfers
unto:

 

 

Name:

[                                                   ]

 

Address:

[                                             ]

[                                             ]

Tax ID: [                           ]

 

that certain Warrant to Purchase Stock issued by Restoration Robotics, Inc., a
Delaware corporation (the “Company”), on November 2, 2018 (the “Warrant”)
together with all rights, title and interest therein.

 

 

 

 

SOLAR CAPITAL LTD.

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

By its execution below, and for the benefit of the Company, [                ]
agrees to all other provisions of the Warrant as of the date hereof.

 

 

[        ]

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

Appendix 2

--------------------------------------------------------------------------------

 

Execution Version

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF
ANY STATE AND, EXCEPT AS SET FORTH IN SECTIONS 5.3 AND 5.4 BELOW, MAY NOT BE
OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED
UNDER SAID ACT AND LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE COMPANY,
SUCH OFFER, SALE, PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

WARRANT TO PURCHASE STOCK

 

Company:

Restoration Robotics, Inc.

Number of Shares:

16,173

Type/Series of Stock:

Common Stock, with par value of $0.0001 per share

Warrant Price:

$1.755 per share

Issue Date:

November 2, 2018

Expiration Date:

May 10, 2028 (See also Section 5.1(b))

Credit Facility:

This Warrant to Purchase Stock (“Warrant”) is issued in connection with that
certain Loan and Security Agreement dated as of May 10, 2018, between the Holder
and the Company (as may be amended from time to time, the “Loan Agreement”).

 

 

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, SUNS SPV LLC,
a Delaware limited liability company with an office located at 500 Park Avenue,
3rd Floor, New York, NY 10022 (together with any successor or permitted assignee
or transferee of this Warrant or of any shares issued upon exercise hereof,
“Holder”) is entitled to purchase the number of fully paid and non- assessable -
(the “Shares”) of the above-stated Type/Series of Stock (the “Class”) of the
above-named company (the “Company”) at the above-stated Warrant Price, all as
set forth above and as adjusted pursuant to Section 2 of this Warrant, subject
to the provisions and upon the terms and conditions set forth in this Warrant.

 

SECTION 1. EXERCISE.

 

1.1Method of Exercise. Holder may at any time and from time to time exercise
this Warrant, in whole or in part, by delivering to the Company the original of
this Warrant together with a duly executed Notice of Exercise in substantially
the form attached hereto as Appendix 1 and, unless Holder is exercising this
Warrant pursuant to a cashless exercise set forth in Section 1.2, a check, wire
transfer of same-day funds (to an account designated by the Company), or other
form of payment acceptable to the Company for the aggregate Warrant Price for
the Shares being purchased.

 

1.2Cashless Exercise. On any exercise of this Warrant, in lieu of payment of the
aggregate Warrant Price in the manner as specified in Section 1.1 above, but
otherwise in accordance with the requirements of Section 1.1, Holder may elect
to receive Shares equal to the value of this Warrant, or portion hereof as to
which this Warrant is being exercised. Thereupon, the Company shall issue to the
Holder such number of fully paid and non-assessable Shares as are computed using
the following formula:

 

X = Y(A-B)/A

 

where:

X = the number of Shares to be issued to the Holder;

Y = the number of Shares with respect to which this Warrant is being exercised
(inclusive of the Shares surrendered to the Company in payment of the aggregate
Warrant Price);

 

A =   the Fair Market Value (as determined pursuant to Section 1.3 below) of  
one Share; and

 

B = the Warrant Price.

 

 

--------------------------------------------------------------------------------

 

 

1.3Fair Market Value. If the Company’s common stock is then traded or quoted on
a nationally recognized securities exchange, inter-dealer quotation system or
over-the-counter market (a “Trading Market”), the fair market value of a Share
shall be the volume-weighted average closing price of a share of common stock
reported for the ten (10) Business Days immediately before the date on which
Holder delivers this Warrant together with its Notice of Exercise to the
Company. If the Company’s common stock is not traded in a Trading Market, the
Board of Directors of the Company shall determine the fair market value of a
Share in its reasonable good faith judgment.

 

1.4Delivery of Certificate and New Warrant. Promptly after Holder exercises this
Warrant in the manner set forth in Section 1.1 or 1.2 above, the Company shall
deliver to Holder a certificate representing the Shares issued to Holder upon
such exercise and, if this Warrant has not been fully exercised and has not
expired, a new warrant of like tenor representing the Shares not so acquired.

 

1.5Replacement of Warrant. On receipt of evidence reasonably satisfactory to the
Company of the loss, theft, destruction or mutilation of this Warrant and, in
the case of loss, theft or destruction, on delivery of an indemnity agreement
reasonably satisfactory in form, substance and amount to the Company or, in the
case of mutilation, on surrender of this Warrant to the Company for
cancellation, the Company shall, within a reasonable time, execute and deliver
to Holder, in lieu of this Warrant, a new warrant of like tenor and amount.

 

1.6Treatment of Warrant Upon Acquisition of Company.

 

(a)Acquisition. For the purpose of this Warrant, “Acquisition” means
any  transaction or series of related transactions involving: (i) the sale,
lease, exclusive license, or other disposition of all or substantially all of
the assets of the Company (ii) any merger or consolidation of the Company into
or with another person or entity (other than a merger or consolidation effected
exclusively to change the Company’s domicile), or any other corporate
reorganization, in which the stockholders of the Company in their capacity as
such immediately prior to such merger, consolidation or reorganization, own less
than a majority of the Company’s (or the surviving or successor entity’s)
outstanding voting power immediately after such merger, consolidation or
reorganization; or (iii) any sale or other transfer by the stockholders of the
Company of shares representing at least a majority of the Company’s then-total
outstanding combined voting power.

 

(b)Treatment of Warrant at Acquisition. In the event of an Acquisition in which
the consideration to be received by the Company’s stockholders consists solely
of cash, solely of Marketable Securities or a combination of cash and Marketable
Securities (a “Cash/Public Acquisition”), either (i) Holder shall exercise this
Warrant pursuant to Section 1.1 and/or 1.2 and such exercise will be deemed
effective immediately prior to and contingent upon the consummation of such
Acquisition or (ii) if Holder elects not to exercise the Warrant, this Warrant
will expire immediately prior to the consummation of such Acquisition.

 

(c)The Company shall provide Holder with written notice of its request relating
to the Cash/Public Acquisition (together with such reasonable information as
Holder may reasonably require regarding the treatment of this Warrant in
connection with such contemplated Cash/Public Acquisition giving rise to such
notice), which is to be delivered to Holder not less than five (5) Business Days
prior to the closing of the proposed Cash/Public Acquisition. Notwithstanding
the foregoing, if, immediately prior to the Cash/Public Acquisition, the fair
market value of one Share (or other security issuable upon the exercise hereof)
as determined in accordance with Section 1.3 above would be greater than the
Warrant Price in effect on such date, then this Warrant shall automatically be
deemed on and as of such date to be exercised pursuant to Section 1.2 above as
to all Shares (or such other securities) for which it shall not previously have
been exercised, and the Company shall promptly notify the Holder of the number
of Shares (or such other securities) issued upon such exercise to the Holder.

 

(d)Upon the closing of any Acquisition other than a Cash/Public Acquisition
defined above, the acquiring, surviving or successor entity shall assume the
obligations of this Warrant, and this Warrant shall thereafter be exercisable
for the same securities and/or other property as would have been paid for the
Shares issuable upon exercise of the unexercised portion of this Warrant as if
such Shares were outstanding on and as of the closing of such Acquisition,
subject to further adjustment from time to time in accordance with the
provisions of this Warrant.

 

(e)As used in this Warrant, “Marketable Securities” means securities meeting all
of the following requirements: (i) the issuer thereof is then subject to the
reporting requirements of Section 13 or Section 15(d) of the Securities Exchange
Act of 1934, as amended (the “Exchange Act”), and is then current in its filing
of all

 

--------------------------------------------------------------------------------

 

required reports and other information under the Act and the Exchange Act; (ii)
the class and series of shares or other security of the issuer that would be
received by Holder in connection with the Acquisition were Holder to exercise
this Warrant on or prior to the closing thereof is then traded in Trading
Market, and (iii) Holder would be able to publicly re-sell, within six (6)
months following the closing of such Acquisition, all of the issuer’s shares
and/or other securities that would be received by Holder in such Acquisition
were Holder to exercise this Warrant in full on or prior to the closing of such
Acquisition.

 

1.7Registration Rights. As to any Shares Holder receives or is entitled to
receive upon any exercise or conversion of this Warrant, Holder shall be
entitled to such demand registration rights and such piggyback registration
rights as are commensurate with such registration rights are set forth in that
certain Investors’ Rights Agreement, dated as of February 7, 2013 by and among
the Company and certain of the Company’s stockholders, as the same may be
amended from time to time, or similar agreement (the “Investors’ Rights
Agreement”).

 

SECTION 2. ADJUSTMENTS TO THE SHARES AND WARRANT PRICE.

 

2.1Stock Dividends, Splits, Etc. If the Company declares or pays a dividend or
distribution on the outstanding shares of the Class payable in common stock or
other securities or property (other than cash), then upon exercise of this
Warrant, for each Share acquired, Holder shall receive, without additional cost
to Holder, the total number and kind of securities and property which Holder
would have received had Holder owned the Shares of record as of the date the
dividend or distribution occurred. If the Company subdivides the outstanding
shares of the Class by reclassification or otherwise into a greater number of
shares, the number of Shares purchasable hereunder shall be proportionately
increased and the Warrant Price shall be proportionately decreased. If the
outstanding shares of the Class are combined or consolidated, by
reclassification or otherwise, into a lesser number of shares, the Warrant Price
shall be proportionately increased and the number of Shares shall be
proportionately decreased.

 

2.2Reclassification, Exchange, Combinations or Substitution. Upon any event
whereby all of the outstanding shares of the Class are reclassified, exchanged,
combined, substituted, or replaced for, into, with or by Company securities of a
different class and/or series, then from and after the consummation of such
event, this Warrant will be exercisable for the number, class and series of
Company securities that Holder would have received had the Shares been
outstanding on and as of the consummation of such event, and subject to further
adjustment thereafter from time to time in accordance with the provisions of
this Warrant. The provisions of this Section 2.2 shall similarly apply to
successive reclassifications, exchanges, combinations substitutions,
replacements or other similar events.

 

2.3No Fractional Share. No fractional Share shall be issuable upon exercise of
this Warrant and the number of Shares to be issued shall be rounded down to the
nearest whole Share. If a fractional Share interest arises upon any exercise of
the Warrant, the Company shall eliminate such fractional Share interest by
paying Holder in cash the amount computed by multiplying the fractional interest
by (i) the fair market value (as determined in accordance with Section 1.3
above) of a full Share, less (ii) the then-effective Warrant Price.

 

2.4Notice/Certificate as to Adjustments. Upon each adjustment of the Warrant
Price, Class and/or number of Shares, the Company, at the Company’s expense,
shall notify Holder in writing within a reasonable time setting forth the
adjustments to the Warrant Price, Class and/or number of Shares and facts upon
which such adjustment is based. The Company shall, upon written request from
Holder, furnish Holder with a certificate of its Chief Financial Officer,
including computations of such adjustment and the Warrant Price, Class and
number of Shares in effect upon the date of such adjustment.

 

--------------------------------------------------------------------------------

 

 

SECTION 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

 

3.1Representations and Warranties. The Company represents and warrants to, and
agrees with, the Holder as follows:

 

(a)The initial Warrant Price referenced on the first page of this Warrant is
equal to the lesser of (a) the ten (10) day trailing average of the Company’s
common stock price, as determined as of the close of business on the business
day immediately prior to the Issue Date, and (b) the Company’s common stock
price, as determined as of the close of business on the business day immediately
prior to the Issue Date.

 

(b)All Shares which may be issued upon the exercise of this Warrant, shall, upon
issuance, be duly authorized, validly issued, fully paid and non-assessable, and
free of any liens and encumbrances except for restrictions on transfer provided
for herein or under applicable federal and state securities laws. The Company
covenants that it shall at all times cause to be reserved and kept available out
of its authorized and unissued capital stock such number of shares of the Class,
common stock and other securities as will be sufficient to permit the exercise
in full of this Warrant.

 

3.2Notice of Certain Events. If the Company proposes at any time to:

(a)declare any dividend or distribution upon the outstanding shares of the Class
or common stock, whether in cash, property, stock, or other securities and
whether or not a regular cash dividend;

 

(c)effect any reclassification, exchange, combination, substitution,
reorganization or recapitalization of the outstanding shares of the Class; or

 

(d)effect an Acquisition or to liquidate, dissolve or wind up. then, in
connection with each such event, the Company shall give Holder:

 

(1)at least five (5) Business Days prior written notice of the date on which a
record will be taken for such dividend, distribution, or subscription rights
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled thereto) or for determining rights to vote, if any, in respect
of the matters referred to in (a) and (b) above; and

 

(2)in the case of the matters referred to in (c) and (d) above at least five (5)
Business Days prior written notice of the date when the same will take place
(and specifying the date on which the holders of outstanding shares of the Class
will be entitled to exchange their shares for the securities or other property
deliverable upon the occurrence of such event).

 

Reference is made to Section 1.6(c) whereby this Warrant will be deemed to be
exercised pursuant to Section 1.2 hereof if the Company does not give written
notice to Holder of a Cash/Public Acquisition as required by the terms hereof.
Company will also provide information requested by Holder that is reasonably
necessary to enable Holder to comply with Holder’s accounting or reporting
requirements.

 

SECTION 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER.

 

The Holder represents and warrants to the Company as follows:

 

4.1Purchase for Own Account. This Warrant and the securities to be acquired upon
exercise of this Warrant by Holder are being acquired for investment for
Holder’s account, not as a nominee or agent, and not with a view to the public
resale or distribution within the meaning of the Act. Holder also represents
that it has not been formed for the specific purpose of acquiring this Warrant
or the Shares.

 

 

--------------------------------------------------------------------------------

 

4.2Disclosure of Information. Holder is aware of the Company’s business affairs
and financial condition and has received or has had full access to all the
information it considers necessary or appropriate to make an informed investment
decision with respect to the acquisition of this Warrant and its underlying
securities. Holder further has had an opportunity to ask questions and  receive
answers from the Company regarding the terms and conditions of the offering of
this Warrant and its underlying securities and to obtain additional information
(to the extent the Company possessed such information or could acquire it
without unreasonable effort or expense) necessary to verify any information
furnished to Holder or to which Holder has access.

 

4.3Investment Experience. Holder understands that the purchase of this Warrant
and its underlying securities involves substantial risk. Holder has experience
as an investor in securities of companies in the development stage and
acknowledges that Holder can bear the economic risk of such Holder’s investment
in this Warrant and its underlying securities and has such knowledge and
experience in financial or business matters that Holder is capable of evaluating
the merits and risks of its investment in this Warrant and its underlying
securities and/or has a preexisting personal or business relationship with the
Company and certain of its officers, directors or controlling persons of a
nature and duration that enables Holder to be aware of the character, business
acumen and financial circumstances of such persons.

 

4.4Accredited Investor Status. Holder is an “accredited investor” within the
meaning of Regulation D promulgated under the Act.

 

4.5The Act. Holder understands that this Warrant and the Shares issuable upon
exercise hereof have not been registered under the Act in reliance upon a
specific exemption therefrom, which exemption depends upon, among other things,
the bona fide nature of the Holder’s investment intent as expressed herein.
Holder understands that this Warrant and the Shares issued upon any exercise
hereof must be held indefinitely unless subsequently registered under the Act
and qualified under applicable state securities laws, or unless exemption from
such registration and qualification are otherwise available. Holder is aware of
the provisions of Rule 144 promulgated under the Act.

 

4.6Reserved.

 

4.7No Voting Rights. Holder, as a Holder of this Warrant, will not have any
voting rights until the exercise of this Warrant.

 

SECTION 5. MISCELLANEOUS.

 

5.1Term and Automatic Conversion Upon Expiration.

 

(a)Term. Subject to the provisions of Section 1.6 above, this Warrant is
exercisable in whole or in part at any time and from time to time on or before
6:00 PM, Pacific time, on the Expiration Date and shall be void thereafter.

 

(b)Automatic Cashless Exercise upon Expiration. In the event that, upon the
Expiration Date, the fair market value of one Share (or other security issuable
upon the exercise hereof) as determined in accordance with Section 1.3 above is
greater than the Warrant Price in effect on such date, then this Warrant shall
automatically be deemed on and as of such date to be exercised pursuant to
Section 1.2 above as to all Shares (or such other securities) for which it shall
not previously have been exercised, and the Company shall, within a reasonable
time, deliver a certificate representing the Shares (or such other securities)
issued upon such exercise to Holder.

 

5.2Legends. The Shares shall be imprinted with a legend in substantially the
following form:

 

THE SHARES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY
STATE AND, EXCEPT AS SET FORTH IN THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED
BY THE ISSUER TO SUNS SPV LLC DATED NOVEMBER 2, 2018, MAY NOT BE OFFERED, SOLD,
PLEDGED OR OTHERWISE TRANSFERRED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND
LAWS OR IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER, SUCH OFFER, SALE,
PLEDGE OR OTHER TRANSFER IS EXEMPT FROM SUCH REGISTRATION.

 

--------------------------------------------------------------------------------

 

 

5.3Compliance with Securities Laws on Transfer. This Warrant and the Shares
issuable upon exercise of this Warrant may not be transferred or assigned in
whole or in part except in compliance with applicable federal and state
securities laws by the transferor and the transferee (including, without
limitation, the delivery of investment representation letters and legal opinions
reasonably satisfactory to the Company, as reasonably requested by the Company).
The Company shall not require Holder to provide an opinion of counsel if the
transfer is to any entity under common management control with Holder, or any
affiliate of Holder, provided that any such transferee is an “accredited
investor” as defined in Regulation D promulgated under the Act. Additionally,
the Company shall also not require an opinion of counsel if there is no material
question as to the availability of Rule 144 promulgated under the Act.

 

5.4Transfer Procedure. After receipt by Holder of the executed Warrant, Holder
may transfer all of this Warrant to any entity under common management control
with Holder, or an affiliate thereof or successor thereto (the “Subsequent
Holder”), by execution of an Assignment substantially in the form of Appendix 2.
Subject to the provisions of Section 5.3 and upon providing the Company with
written notice, Subsequent Holder may transfer all or part of this Warrant or
the Shares issuable upon exercise of this Warrant to any transferee, provided,
however, in connection with any such transfer, the Subsequent Holder will give
the Company notice of the portion of the Warrant being transferred with the
name, address and taxpayer identification number of the transferee and Holder
will surrender this Warrant to the Company for reissuance to the transferee(s)
(and Holder if applicable); and provided further, that any subsequent transferee
shall agree in writing with the Company to be bound by all of the terms and
conditions of this Warrant.

 

5.5Notices. All notices and other communications hereunder from the Company to
the Holder, or vice versa, shall be deemed delivered and effective (i) when
given personally, (ii) on the third (3rd) Business Day after being mailed by
first-class registered or certified mail, postage prepaid, (iii) upon actual
receipt if given by facsimile or electronic mail and such receipt is confirmed
in writing by the recipient, or (iv) on the first Business Day following
delivery to a reliable overnight courier service, courier fee prepaid, in any
case at such address as may have been furnished to the Company or Holder, as the
case may be, in writing by the Company or such Holder from time to time in
accordance with the provisions of this Section 5.5. All notices to Holder shall
be addressed as follows until the Company receives notice of a change of address
in connection with a transfer or otherwise:

 

SUNS SPV LLC

c/o Solar Capital Ltd.

500 Park Avenue, 3rd Floor

New York, NY 10022

Attn: Anthony Storino Telephone: (646) 308 - 8730

Fax: (212) 993-1698

Email: storino@solarcapltd.com

With a copy (which shall not constitute notice) to:

 

Baker Botts L.L.P.

101 California Street, Suite 3600 San Francisco, CA 94111

Attn: Jeff Kayes Fax: (415) 291-6331

Email: jeff.kayes@bakerbotts.com

 

Notice to the Company shall be addressed as follows until Holder receives notice
of a change in address:

 

Restoration Robotics, Inc. 128 Baytech Drive

San Jose, CA

Attn: Chief Financial Officer

Email: markh@restorationrobotics.com

 

With a copy (which shall not constitute notice) to:

 

Latham & Watkins LLP 140 Scott Drive

Menlo Park, CA 94025 Attn: Brian J. Cuneo

Email: Brian.Cuneo@lw.com

 

 

--------------------------------------------------------------------------------

 

5.6Waiver. This Warrant and any term hereof may be changed, waived, discharged
or terminated (either generally or in a particular instance and either
retroactively or prospectively) only by an instrument in writing signed by the
party against which enforcement of such change, waiver, discharge or termination
is sought.

 

5.7Attorney’s Fees. In the event of any dispute between the parties concerning
the terms and provisions of this Warrant, the party prevailing in such dispute
shall be entitled to collect from the other party all costs incurred in such
dispute, including reasonable attorneys’ fees.

 

5.8Counterparts; Facsimile/Electronic Signatures. This Warrant may be executed
in counterparts, all of which together shall constitute one and the same
agreement. Any signature page delivered electronically or by facsimile shall be
binding to the same extent as an original signature page with regards to any
agreement subject to the terms hereof or any amendment thereto.

 

5.9Governing Law. This Warrant shall be governed by and construed in accordance
with the laws of the State of New York, without giving effect to its principles
regarding conflicts of law.

 

5.10Headings. The headings in this Warrant are for purposes of reference only
and shall not limit or otherwise affect the meaning of any provision of this
Warrant.

 

5.11Business Days. “Business Day” is any day that is not a Saturday, Sunday or a
day on which banks in New York, New York are closed.

 

[Signature page follows]

 

 

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties have caused this Warrant to Purchase Stock to be
executed by their duly authorized representatives effective as of the Issue Date
written above.

 

 

“COMPANY”

 

 

 

RESTORATION ROBOTICS, INC.

 

 

 

 

By:

 

 

Name:

Mark Hair

 

Title:

Chief Financial Officer

 

“HOLDER”

 

 

 

SUNS SPV LLC

 

 

 

 

By:

 

 

Name:

Richard Peteka

 

Title:

Authorized Signatory

 

 

 

 

--------------------------------------------------------------------------------

 

APPENDIX 1

 

 

NOTICE OF EXERCISE

 

 

1.The undersigned Holder hereby exercises its right purchase
                                   shares of the Common/ Stock of Restoration
Robotics, Inc. (the “Company”) in accordance with the attached Warrant To
Purchase Stock, and tenders payment of the aggregate Warrant Price for such
shares as follows:

 

 

[   ]

check in the amount of $                 payable to order of the Company
enclosed herewith

 

 

[   ]

Wire transfer of immediately available funds to the Company’s account

 

[   ]

Cashless Exercise pursuant to Section 1.2 of the Warrant

 

[   ]

Other [Describe]
                                                                                           

 

2.Please issue a certificate or certificates representing the Shares in the name
specified below:

 

 

Holder’s Name

 

 

 

 

 

 

 

(Address)

 

3.By its execution below and for the benefit of the Company, Holder hereby
restates each of the representations and warranties in Section 4 of the Warrant
to Purchase Stock as of the date hereof.

 

 

HOLDER:

 

 

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

 

 

 

(Date):

 

 

 

 

Appendix 1

--------------------------------------------------------------------------------

 

APPENDIX 2 ASSIGNMENT

For value received, SUNS SPV LLC, hereby sells, assigns and transfers unto:

 

 

Name:

[                                                                        ]

 

Address:

[                                                                 ]

[                                                                 ]

Tax ID: [                                           ]

 

that certain Warrant to Purchase Stock issued by Restoration Robotics, Inc., a
Delaware corporation (the “Company”), on November 2, 2018 (the “Warrant”)
together with all rights, title and interest therein.

 

 

SUNS SPV LLC

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

By its execution below, and for the benefit of the Company, [
                              ] agrees to all other provisions of the Warrant as
of the date hereof.

 

 

[         ]

 

 

 

 

By:

 

 

 

 

 

Name:

 

 

 

 

 

Title:

 

 

Appendix 2