Amendment to Third Amended and Restated Investors' Rights Agreement



 Exhibit 4.3 

ZOGENIX, INC. 

AMENDMENT TO THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 
 This Amendment (this
“Amendment”) to that certain Third Amended and Restated Investors’ Rights Agreement, dated as of December 2, 2009 (the “Rights Agreement”), by and among Zogenix, Inc., a Delaware corporation (the
“Company”), and the persons and entities (each an “Investor” and collectively, the “Investors”) listed on Exhibit A thereto, is entered into by and among the Company, the Investors
(including Oxford Finance Corporation (“Oxford”)) and Silicon Valley Bank (“SVB”) effective as of July 1, 2010. 

RECITALS 

WHEREAS: In connection with that certain Loan and Security Agreement by and among the Company, Oxford and SVB, dated on or about
the date hereof (the “Loan Agreement”), that certain warrant to purchase 1,145,455 shares of the Company’s Series B Preferred Stock issued to Oxford in connection with the execution of the Loan Agreement (the “Oxford
Warrant”) and that certain warrant to purchase 445,455 shares of the Company’s Series B Preferred Stock issued to SVB in connection with the execution of the Loan Agreement (the “SVB Warrant”), SVB desires to become,
and the Company and the Investors desire SVB to become, a party to the Rights Agreement in order to obtain certain “piggyback” and Form S-3 registration rights granted to the Investors in the Rights Agreement, and Oxford desires to have
the shares issuable upon exercise of the Oxford Warrant included as Registrable Securities (as such term is defined in the Rights Agreement) thereunder. 

WHEREAS: The Company expects to enter into a Note Purchase Agreement, dated as of July 1, 2010 (the “Note Purchase
Agreement”), by and among the Company and the Investors who are signatories thereto, pursuant to which the Company will issue certain convertible promissory notes which may be converted into shares of Common Stock. 

WHEREAS: Under Section 5.1 of the Rights Agreement, the Holders of at least 67% of the outstanding shares of the Registrable
Securities may amend, on behalf of all other Holders of Registrable Securities, the Rights Agreement. 
 WHEREAS: The
undersigned Holders of at least 67% of the outstanding shares of Registrable Securities and the Company desire to amend the Rights Agreement to effect the intent of the foregoing recitals. 

NOW, THEREFORE: In consideration of the above recitals and for other good and valuable consideration, the receipt and adequacy of
which is hereby acknowledged, the parties hereto hereby agree as follows: 
  

	1.	Definitions. 

 Unless
otherwise defined herein, the capitalized terms used herein shall have the same meaning ascribed to such terms in the Rights Agreement. 








	2.	Amendments to the Rights Agreement. 


a. The definition of “Holder” is hereby amended and restated as set forth below: 

“Holder” shall mean (i) any Investor holding Registrable Securities, (ii) solely for purposes
of Sections 2.1(e), 2.2, 2.3(d), 2.4, 2.5, 2.6, 2.7, 2.9, 2.10, 2.11, 2.12 and 5 of this Agreement, GECC to the extent that it holds Registrable Securities (iii) solely for purposes of Sections 2.1(e), 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.9, 2.10,
2.11, 2.12 and 5 of this Agreement, each of CIT and SVB to the extent it holds Registrable Securities, and (iv) any holder of Registrable Securities to whom the registration rights conferred by this Agreement have been duly and validly
transferred in accordance with Section 2.12 of this Agreement.” 
 b. The definition of “Investor
Notes” is hereby added as follows: 
 “Investor Notes” shall mean collectively those
convertible promissory notes issued to certain of the Investors pursuant to the Note Purchase Agreement. 
 c. The definition of
“Oxford Shares” is hereby amended and restated as set forth below: 
 “Oxford Shares”
means the shares of the Preferred Stock issuable upon exercise of the Oxford Warrants. 
 d. The definition of “Oxford
Warrant” is hereby amended and restated as set forth below: 
 “Oxford Warrants” shall mean
those certain warrants dated June 30, 2008 and July 1, 2010, issued to Oxford. 
 e. The definition of
“Registrable Securities” is hereby amended and restated as set forth below: 
 “Registrable
Securities” shall mean (i) shares of Common Stock issued or issuable pursuant to the conversion of the Shares or the Investor Notes or exercise of the Investor Warrants or the Oxford Warrants, and solely for purposes of Sections
2.1(e), 2.2, 2.3(d), 2.4, 2.5, 2.6, 2.7, 2.9, 2.10, 2.11, 2.12 and 5 of this Agreement, shares of Common Stock issuable pursuant to the conversion of the GE Shares or exercise of the GECC Warrant, and solely for purposes of Sections 2.1(e), 2.2,
2,3, 2.4, 2.5, 2.6, 2.7, 2.9, 2.10, 2.11, 2.12 and 5 of this Agreement, shares of Common Stock issuable pursuant to the conversion of the CIT Shares, SVB Shares or exercise of the CIT Warrant or SVB Warrant, and (ii) any Common Stock of the
Company issued as a dividend or other distribution with respect to or in exchange for or in replacement of the Shares referenced in clause (i) above (or the shares of Common Stock referenced in clause (i) above); provided,
however, that Registrable Securities shall not include any shares of Common Stock described in clause (i) or (ii) above which have previously been registered or which have been sold to the public either pursuant to a registration
statement or Rule 144, or which have been sold in a private transaction in which the transferor’s rights under this Agreement are not validly assigned in accordance with this Agreement; provided further, that for the avoidance of
doubt the shares of Common Stock issuable pursuant to the conversion of the GE Shares, CIT Shares, Oxford Shares or SVB Shares, or exercise of the GECC Warrant, CIT Warrant, Oxford Warrant or SVB Warrant, shall not be Registrable Securities for
purposes of Section 2.8 of this Agreement.” 
  

 2 








 f. The definition of “SVB” is hereby added as follows: 

“SVB” shall mean Silicon Valley Bank. 

g. The definition of “SVB Shares” is hereby added as follows: 

“SVB Shares” means the shares of the Preferred Stock issuable upon exercise of the SVB Warrant.

 h. The definition of “SVB Warrant” is hereby added as follows: 

“SVB Warrant” shall mean that certain warrant dated July 1, 2010, issued to SVB. 

i. The second paragraph of Section 2.1(e) is hereby amended and restated as follows: 

Notwithstanding any other provision of this Section 2.1, if the underwriters advise the Initiating Holders in
writing that market factors require a limitation on the number of shares to be underwritten, the number of Registrable Securities and Other Shares that may be so included shall be allocated as follows: (i) first, among all the Holders
(excluding GECC, CIT and SVB) requesting to include Registrable Securities held by such Holders, assuming conversion; (ii) second, to GECC, CIT and SVB; (iii) third, to the Other Selling Shareholders; and (iv) fourth, to the Company,
which the Company may allocate, at its discretion, for its own account, or for the account of other holders or employees of the Company. 

j. The following Investor is hereby added to Exhibit A of the Rights Agreement: 

Solely for purposes of Sections 2.1(e), 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.10, 2.11, 2.12 and 5 of the Agreement, SVB.

  

	3.	Limitation of Rights of SVB. 


It is expressly understood by the parties to this Amendment that SVB shall be a party to the Rights Agreement with respect to the
Registrable Securities issuable upon conversion of the SVB Shares only for the purpose of those certain rights and obligations set forth in Sections 2.1(e), 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.10, 2.11, 2.12 and 5 of the Rights Agreement. For
clarification and to avoid confusion, SVB shall have no rights, and the Company and the Investors shall have no obligations to SVB, with respect to the sections of the Rights Agreement entitled (i) “Request for Registration,” as set
forth in Section 2.1(a) to the Rights Agreement (except as provided in Section 2.1(e) thereof), (ii) “Covenants of the Company,” as set forth in Section 3 to the Rights Agreement, and (iii) “Right of First
Refusal,” as set forth in Section 4 to the Rights Agreement. 
  

 3 









	4.	Addition of SVB to the Rights Agreement. 


Concurrently with the execution and delivery of this Amendment, SVB shall execute and deliver a counterpart signature page to the Rights
Agreement and SVB will, upon delivery to the Company of such counterpart signature page, become a party to, and will be bound by, the Rights Agreement as a Holder of Registrable Securities to the extent set forth in this Amendment and the Rights
Agreement, as amended by this Amendment. 
  

	5.	Full Force and Effect. 


Except as amended above, the Rights Agreement shall remain in full force and effect. 

 

	6.	Governing Law. 

 This
Amendment shall be governed in all respects by the internal laws of the State of California as applied to agreements entered into among California residents to be performed entirely within California, without regard to principles of conflicts of
law. 
  

	7.	Titles and Subtitles. 


The titles and subtitles used in this Amendment are used for convenience only and are not to be considered in construing or interpreting
this Amendment. 
  

	8.	Counterparts. 

 This
Amendment may be executed in any number of counterparts, each of which shall be enforceable against the parties that execute such counterparts, and all of which together shall constitute one instrument. 

 

	9.	Telecopy Execution and Delivery. 


A facsimile, telecopy or other reproduction of this Amendment may be executed by one or more parties hereto and delivered by such party by
facsimile or any similar electronic transmission device pursuant to which the signature of or on behalf of such party can be seen. Such execution and delivery shall be considered valid, binding and effective for all purposes. At the request of any
party hereto, all parties hereto agree to execute and deliver an original of this Amendment as well as any facsimile, telecopy or other reproduction thereof. 

(Remainder of Page Intentionally Left Blank) 

 

 4 








 IN WITNESS WHEREOF, this Amendment is executed as of the date first written above.

  

			
	 COMPANY:

	
	 ZOGENIX, INC.

		
	By:	 	 /s/ Roger L. Hawley

		 	Name: Roger L. Hawley
		 	Title: Chief Executive Officer


  

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	OXFORD FINANCE CORPORATION
		
	By:	 	 /s/ John G.
Henderson




			
		
	Print Name:	 	 John G.
Henderson




			
		
	Title:	 	 Vice President & General Counsel




 

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	Solely for the purposes of Sections 2.1(e), 2.2, 2.3, 2.4, 2.5, 2.6, 2.7, 2.10, 2.11, 2.12 and 5 of the Rights Agreement:
	
	INVESTORS:
	
	SILICON VALLEY BANK
		
	By:	 	 /s/ Derek R.
Brunelle




			
		
	Print Name:	 	 Derek R.
Brunelle




			
		
	Title:	 	 Relationship Manager




 

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	CLARUS LIFESCIENCES I, L.P.
		
	By:	 	Clarus Ventures I Management, L.P.
		 	its general partner
		
	By:	 	Clarus Ventures I, LLC
		 	its general partner
		
	By:	 	 /s/ Kurt C. Wheeler

		 	Kurt C. Wheeler
		 	Managing Director


  

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	DOMAIN PARTNERS VI, L.P.
	By:	 	 One Palmer Square Associate VI, L.L.C.

		 	 its General Partner

		
	By:	 	 /s/ Lisa A. Kraeutler

		 	 Lisa A. Kraeutler

		 	 Attorney-in-Fact

		 	
	
	DP VI ASSOCIATES, L.P.
	By:	 	 One Palmer Square Associates VI, L.L.C.,

		 	 its General Partner

		
	By:	 	 /s/ Lisa A. Kraeutler

		 	 Lisa A. Kraeutler

		 	 Attorney-in-Fact

	
	DOMAIN PARTNERS VII, L.P.
	By:	 	 One Palmer Square Associate VII, L.L.C.

		 	 its General Partner

		
	By:	 	 /s/ Lisa A. Kraeutler

		 	 Lisa A. Kraeutler

		 	 Attorney-in-Fact

	
	DP VII ASSOCIATES, L.P.
	By:	 	 One Palmer Square Associates VII, L.L.C.,

		 	 its General Partner

		
	By:	 	 /s/ Lisa A. Kraeutler

		 	 Lisa A. Kraeutler

		 	 Attorney-in-Fact



  

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	SCALE VENTURE PARTNERS II, LP
	By:	 	 Scale Venture Management II, LLC

		 	 its General Partner

		
	By:	 	 /s/ Louis C. Bock

		 	Louis C. Bock
		 	Managing Director


  

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	THOMAS, MCNERNEY & PARTNERS, L.P.
		
	By:	 	 /s/ James E
Thomas




			
		
	Print Name:	 	 /s/ James E.
Thomas




			
		
	Title:	 	 Manager

	
	TMP NOMINEE, LLC
		
	By:	 	 /s/ James E
Thomas




			
		
	Print Name:	 	 /s/ James E.
Thomas




			
		
	Title:	 	 Manager

	
	TMP ASSOCIATES, L.P.
		
	By:	 	 /s/ James E
Thomas




			
		
	Print Name:	 	 /s/ James E.
Thomas




			
		
	Title:	 	 Manager




 

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	THOMAS, MCNERNEY & PARTNERS II, L.P.
		
	By:	 	 /s/ James E
Thomas




			
		
	Print Name:	 	 /s/ James E.
Thomas




			
		
	Title:	 	
Manager




			
	
	TMP NOMINEE II, LLC
		
	By:	 	 /s/ James E
Thomas




			
		
	Print Name:	 	 /s/ James E.
Thomas




			
		
	Title:	 	
Manager




			
	
	TMP ASSOCIATES II, L.P.
		
	By:	 	 /s/ James E
Thomas




			
		
	Print Name:	 	 /s/ James E.
Thomas




			
		
	Title:	 	 Manager




 

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	ABINGWORTH BIOVENTURES IV EXECUTIVES LP
	acting by:
	
	Its manager Abingworth Management Ltd



			
		
	By:	 	 /s/ James
Abel




			
		
	Print Name:	 	 James
Abel




			
		
	Title:	 	 Director

	
	ABINGWORTH BIOVENTURES IV LP
	acting by:
	
	Its manager Abingworth Management Ltd



			
		
	By:	 	 /s/ James
Abel




			
		
	Print Name:	 	 James
Abel




			
		
	Title:	 	 Director




 

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT 









			
	INVESTORS:
	
	CHICAGO GROWTH PARTNERS II, L.P.
		
	By:	 	Chicago Growth Management II, LP



			
	Its:	 	General Partner



			
		
	By:	 	Chicago Growth Management II, LLC



			
	Its:	 	General Partner
		
	By:	 	 /s/ A. M.
Minocherhomjee




			
	Print Name:	 	Arda Minocherhomjee



			
	Title:	 	Partner


  

 SIGNATURE PAGE TO AMENDMENT
TO 
 THIRD AMENDED AND RESTATED
INVESTORS’ RIGHTS AGREEMENT