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Exhibit 10.16  


THIS
WARRANT HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "1933 ACT"), OR ANY APPLICABLE STATE SECURITIES LAWS, AND MAY NOT
BE SOLD OR TRANSFERRED UNLESS SUCH SALE OR TRANSFER IS IN ACCORDANCE WITH THE REGISTRATION REQUIREMENTS OF SUCH ACT AND APPLICABLE LAWS OR SOME OTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF
SUCH ACT AND APPLICABLE LAWS IS AVAILABLE WITH RESPECT THERETO. 


 
 

PREFERRED STOCK PURCHASE WARRANT    




	Warrant No.	 	 
	 	Number of Shares: a maximum of 300,578

Series D Preferred Stock

Subject to determination as set for the below




 
 

ANACOR PHARMACEUTICALS, INC.    
    
    Effective as of June 30, 2006    
    
    Void after June 30, 2013    



        1.    Issuance.    This Preferred Stock Purchase Warrant (the
"Warrant") is issued to LIGHTHOUSE CAPITAL PARTNERS V, L.P. by ANACOR
PHARMACEUTICALS, INC., a Delaware corporation (hereinafter with its successors called the "Company"). 


        2.    Purchase Price; Number of Shares.    


        (a)   The registered holder of this Warrant (the "Holder"), is entitled upon
surrender of this Warrant with the subscription form annexed hereto duly executed, at the principal office of the Company, to purchase from the Company, at a price per share of $1.73 (the
"Purchase Price"), up to a maximum of 300,578 fully paid and nonassessable shares of the Company's Series D Preferred Stock, $0.001 per share par
value (the "Preferred Stock"). Commencing on the date hereof, 150,289 (the "Exercise Quantity") of
shares of Preferred Stock are immediately available for purchase hereunder. 


        (b)   On the Commitment Termination Date, or such earlier termination of this Warrant in accordance with the terms hereof, the
Exercise Quantity shall automatically be increased by such additional number of shares as is equal to (A) 3.25% of the amount of Aggregate Advances funded under the Loan Agreement, if any,
divided by (B) the Purchase Price, rounded down to the nearest whole number. 


In
addition to other terms which may be defined herein, the following terms, as used in this Warrant, shall have the following meanings: 



	(i)
	"Aggregate Advances" means the aggregate original dollar amount of Advances made under the Loan Agreement, whether such
Advances are outstanding or prepaid, at the time of any scheduled adjustment to the Exercise Quantity.



	(ii)
	"Loan Agreement" means that certain Loan and Security Agreement No. 5251 dated June 30, 2006 between the
Company and Lighthouse Capital Partners V, L.P.. 




Any
term not defined herein shall have the meaning as set forth in the Loan Agreement. 


Until
such time as this Warrant is exercised in full or expires, the Purchase Price and the securities issuable upon exercise of this Warrant are subject to adjustment as hereinafter provided. The
person or persons in whose name or names any certificate representing shares of Preferred Stock is issued 


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hereunder
shall be deemed to have become the holder of record of the shares represented thereby as at the close of business on the date this Warrant is exercised with respect to such shares, whether
or not the transfer books of the Company shall be closed. 


        3.    Payment of Purchase Price.    The Purchase Price may be paid
(i) in cash or by check, (ii) by the surrender by the Holder to the Company of any promissory notes or other obligations issued by the Company, with all such notes and obligations so
surrendered being credited against the Purchase Price in an amount equal to the principal amount thereof plus accrued interest to the date of surrender, or (iii) by any combination of the
foregoing. 


        4.    Net Issue Election.    The Holder may elect to receive, without
the payment by the Holder of any additional consideration, shares of Preferred Stock equal to the value of this Warrant or any portion hereof by the surrender of this Warrant or such portion to the
Company, with the net issue election notice annexed hereto duly executed, at the principal office of the Company. Thereupon, the Company shall issue to the Holder such number of fully paid and
nonassessable shares of Preferred Stock as is computed using the following formula: 



	X=	 	Y(A – B)
 A






	

where:	
 	

X =	
 	

the number of shares of Preferred Stock to be issued to the Holder pursuant to this Section 4.
	

 	
 	

Y =	
 	

the number of shares of Preferred Stock covered by this Warrant in respect of which the net issue election is made pursuant to this Section 4.
	

 	
 	

A =	
 	

the Fair Market Value (defined below) of one share of Preferred Stock, as determined at the time the net issue election is made pursuant to this Section 4.
	

 	
 	

B =	
 	

the Purchase Price in effect under this Warrant at the time the net issue election is made pursuant to this Section 4.






        "Fair Market Value" of a share of Preferred Stock (or fully paid and nonassessable shares of the Company's common stock, $0.001 par value
(the "Common Stock") if the Preferred Stock has been automatically converted into Common Stock) as of the date that the net issue election is made (the
"Determination Date") shall mean: 



          (i)  If the net issue election is made in connection with and contingent upon the closing of the sale of the Company's Common
Stock to the public in a public offering pursuant to a Registration Statement under the 1933 Act (a "Public Offering"), and if the Company's
Registration Statement relating to such Public Offering ("Registration Statement") has been declared effective by the Securities and Exchange
Commission, then the initial "Price to Public" specified in the final prospectus with respect to such offering multiplied by the number of shares of Common Stock into which each share of Preferred
Stock is then convertible. 


         (ii)  If the net issue election is not made in connection with and contingent upon a Public Offering, then as follows: 



        (a)   If traded on a securities exchange or the Nasdaq National Market, the fair market value of the Common Stock shall be
deemed to be the average of the closing or last reported sale prices of the Common Stock on such exchange or market over the five day period ending five trading days prior to the Determination Date,
and the fair market 





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value
of the Preferred Stock shall be deemed to be such fair market value of the Common Stock multiplied by the number of shares of Common Stock into which each share of Preferred Stock is then
convertible; 


        (b)   If otherwise traded in an over-the-counter market, the fair market value of the Common Stock
shall be deemed to be the average of the closing ask prices of the Common Stock over the five day period ending five trading days prior to the Determination Date, and the fair market value of the
Preferred Stock shall be deemed to be such fair market value of the Common Stock multiplied by the number of shares of Common Stock into which each share of Preferred Stock is then convertible; and 



        (c)   If there is no public market for the Common Stock, then fair market value shall be determined in good faith by the
Company's Board of Directors. 






        5.    Partial Exercise.    This Warrant may be exercised in part, and
the Holder shall be entitled to receive a new warrant, which shall be dated as of the date of this Warrant, covering the number of shares in respect of which this Warrant shall not have been
exercised. 


        6.    Fractional Shares.    In no event shall any fractional share of
Preferred Stock be issued upon any exercise of this Warrant. If, upon exercise of this Warrant in its entirety, the Holder would, except as provided in this  Section 6, be entitled to receive a
fractional share of Preferred Stock, then the Company shall issue the next lower number of full shares of
Preferred Stock and shall pay to the Holder a cash amount equal to the Fair Market Value (as of the date of exercise) of such fractional share of Preferred Stock. 



        7.    Expiration Date; Automatic Exercise.    This Warrant shall
expire at the close of business on June 30, 2013, and shall be void thereafter (the "Expiration Date"). Notwithstanding the term of this Warrant
fixed pursuant to this Section 7, and provided Holder has received advance written notice of at least ten (10) days and has not earlier
exercised this Warrant, and provided this Warrant has not been assumed by the successor entity (or parent thereof), upon the consummation of a Merger (as defined below), this Warrant shall
automatically be exercised pursuant to Section 4 hereof, without any action by Holder. "Merger"
means: (i) a sale of all or substantially all of the Company's assets to an Unaffiliated Entity (as defined below), or (ii) the merger, consolidation or acquisition of the Company with,
into or by an Unaffiliated Entity (other than a merger or consolidation for the principle purpose of changing the domicile of the Company or a bona fide round of preferred stock equity financing),
that results in
the transfer of fifty percent (50%) or more of the outstanding voting power of the Company. "Unaffiliated Entity" means any entity that is owned or
controlled by parties who own less than twenty percent (20%) of the combined voting power of the voting securities of the Company immediately prior to such merger, consolidation or acquisition.
Notwithstanding the foregoing, in the event that any outstanding warrants to purchase equity securities of the Company are assumed by the successor entity of a Merger (or parent thereof), this Warrant
shall also be similarly assumed. The Company agrees to promptly give the Holder written notice of any proposed Merger and written notice of termination of any proposed Merger. Notwithstanding anything
to the contrary in this Warrant, the Holder may rescind any exercise of its purchase rights after a notice of termination of the proposed Merger if the exercise of this Warrant occurred after the
Company notified the Holder that the Merger was proposed or if the exercise was otherwise precipitated by such proposed Merger, provided, however that such rescission right must be exercised within
thirty (30) days of receipt of such written notice of termination of the proposed Merger. In the event of such rescission, this Warrant will continue to be exercisable on the same terms and
conditions. 


        8.    Reserved Shares; Valid Issuance.    The Company covenants that
it will at all times from and after the date hereof reserve and keep available such number of its authorized shares of Preferred Stock and Common Stock free from all preemptive or similar rights
therein, as will be sufficient to permit, respectively, the exercise of this Warrant in full and the conversion into shares of Common 


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Stock
of all shares of Preferred Stock receivable upon such exercise. The Company further represents that such shares as may be issued pursuant to such exercise and/or conversion will, upon issuance,
be duly and validly issued, fully paid and nonassessable and free from all taxes, liens and charges with respect to the issuance thereof. 


        9.    Stock Splits and Dividends.    If after the date hereof the
Company shall subdivide the Preferred Stock, by split-up or otherwise, or combine the Preferred Stock, or issue additional shares of Preferred Stock in payment of a stock dividend on the
Preferred Stock, the number of shares of Preferred Stock issuable on the exercise of this Warrant shall forthwith be proportionately increased in the case of a subdivision or stock dividend, or
proportionately decreased in the case of a combination, and the Purchase Price shall forthwith be proportionately decreased in the case of a subdivision or stock dividend, or proportionately increased
in the case of a combination. 


        10.    Adjustments for Diluting Issuances.    The other antidilution
rights applicable to the Preferred Stock and the Common Stock of the Company are set forth in the Amended and Restated Certificate of Incorporation, as amended from time to time (the
"Articles"), a true and complete copy in its current form which is attached hereto as Exhibit A.
Such rights shall not be restated, amended or modified in any manner which affects the Holder differently than the holders of Preferred Stock without such Holder's prior written consent. The Company
shall promptly provide the Holder hereof with any restatement, amendment or modification to the Articles promptly after the same has been made. 


        11.    Reclassifications.    If after the date hereof the Company
shall enter into any Reorganization (as hereinafter defined), then, as a condition of such Reorganization, lawful provisions shall be made, and duly executed documents evidencing the same from the
Company or its successor shall be delivered to the Holder, so that the Holder shall thereafter have the right to purchase, at a total price not to exceed that payable upon the exercise of this Warrant
in full, the kind and amount of shares of stock and other securities and property receivable upon such Reorganization by a holder of the number of shares of Preferred Stock which might have been
purchased by the Holder immediately prior to such Reorganization, and in any such case appropriate provisions shall be made with respect to the rights and interest of the Holder to the end that the
provisions hereof (including without limitation, provisions for the adjustment of the Purchase Price and the number of shares issuable hereunder and the provisions relating to the net issue election)
shall thereafter be applicable in relation to any shares of stock or other securities and property thereafter deliverable upon exercise hereof. For the purposes of this  Section 11, the term
"Reorganization" shall include any reclassification, capital reorganization
(other than as a result of a subdivision, combination or stock dividend provided for in Section 9 hereof). 


        12.    Certificate of Adjustment.    Whenever the Purchase Price is
adjusted, as herein provided, the Company shall promptly deliver to the Holder a certificate of the Company's chief financial officer setting forth the Purchase Price after such adjustment and setting
forth a brief statement of the facts requiring such adjustment. 


        13.    Notices of Record Date, Etc.    In the event of: 



        (a)   any taking by the Company of a record of the holders of any class of securities for the purpose of determining the
holders thereof who are entitled to receive any dividend or other distribution, or any right to subscribe for, purchase, sell or otherwise acquire or dispose of any shares of stock of any class or any
other securities or property, or to receive any other right; 


        (b)   any reclassification of the capital stock of the Company, capital reorganization of the Company, consolidation or merger
involving the Company, or sale or conveyance of all or substantially all of its assets; or 


        (c)   any voluntary or involuntary dissolution, liquidation or winding-up of the Company; 



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then
in each such event the Company will provide or cause to be provided to the Holder a written notice thereof. Such notice shall be provided at least ten (10) business days prior to the date
specified in such notice on which any such action is to be taken. 


        14.    Representations, Warranties and Covenants.    This Warrant is
issued and delivered by the Company and accepted by each Holder on the basis of the following representations, warranties and covenants made by the Company: 



        (a)   The Company has all necessary authority to issue, execute and deliver this Warrant and to perform its obligations
hereunder. This Warrant has been duly authorized issued, executed and delivered by the Company and is the valid and binding obligation of the Company, enforceable in accordance with its terms. 


        (b)   The shares of Preferred Stock issuable upon the exercise of this Warrant have been duly authorized and reserved for
issuance by the Company and, when issued in accordance with the terms hereof, will be validly issued, fully paid and nonassessable. 


        (c)   The issuance, execution and delivery of this Warrant do not, and the issuance of the shares of Preferred Stock upon the
exercise of this Warrant in accordance with the terms hereof will not, (i) violate or contravene the Company's Articles or by-laws, or any law, statute, regulation, rule, judgment
or order applicable to the Company, (ii) violate, contravene or result in a breach or default under any contract, agreement or instrument to which the Company is a party or by which the Company
or any of its assets are bound or (iii) require the consent or approval of or the filing of any notice or registration with any person or entity, except for filings required under California
securities laws. 


        (d)   As long as this Warrant is, or any shares of Preferred Stock issued upon exercise of this Warrant or any shares of Common
Stock issued upon conversion of such shares of Preferred Stock are, issued and outstanding, the Company will provide to the Holder the financial information described in the Loan Agreement. 


        (e)   As of June 15, 2006 hereof, the authorized capital stock of the Company consists of (i) 51,150,000 shares
of Common Stock, of which 6,051,283 shares are issued and outstanding and 300,578 shares are reserved for issuance upon the exercise of this Warrant with respect to Common Stock and the conversion of
the Preferred Stock into Common Stock if this Warrant is exercised with respect to Preferred Stock, and (ii) 4,228,329 shares of Series A-1 Preferred Stock, of which
4,228,329 are issued and outstanding shares; (iii) 1,198,046 shares of Series A-2 Preferred Stock, of which 1,198,046 are issued and outstanding shares (iv) 3,339,341
shares of Series B Preferred Stock, of which 3,339,341 are issued and outstanding shares; (v) 28,089,885 shares of Series C Preferred Stock, of which 28,089,885 are issued and
outstanding shares and (vi) 3,400,000 shares of Series D Preferred Stock, of which 2,930,500 are issued and outstanding shares. Attached hereto as  Exhibit Bis a capitalization
table summarizing the capitalization of the Company. At the request of Holder, not more than once per calendar
quarter, the Company will provide Holder with a current capitalization table indicating changes, if any, to the number of outstanding shares of common stock and preferred stock. 




        15.    Registration Rights.    The Company has entered into an Amended
and Restated Investors' Rights Agreement in the form attached hereto as Exhibit C. 


        16.    Amendment.    The terms of this Warrant may be amended,
modified or waived only with the written consent of the Holder. 


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        17.    Representations and Covenants of the Holder.    This Warrant
has been entered into by the Company in reliance upon the following representations and covenants of the Holder, which by its execution hereof the Holder hereby confirms: 



        (a)    Investment Purpose.    The right to acquire Preferred Stock or
the Preferred Stock issuable upon exercise of the Holder's rights contained herein will be acquired for investment and not with a view to the sale or distribution of any part thereof, and the Holder
has no present intention of selling or engaging in any public distribution of the same except pursuant to a registration or exemption. 


        (b)    Accredited Investor.    Holder is an "accredited investor"
within the meaning of the Securities and Exchange Rule 501 of Regulation D, as presently in effect. 


        (c)    Private Issue.    The Holder understands (i) that the
Preferred Stock issuable upon exercise of the Holder's rights contained herein is not registered under the 1933 Act or qualified under applicable state securities laws on the ground that the issuance
contemplated by this Warrant will be exempt from the registration and qualifications requirements thereof, and (ii) that the Company's reliance on such exemption is predicated on the
representations set forth in this Section 17. 


        (d)    Financial Risk.    The Holder has such knowledge and experience
in financial and business matters as to be capable of evaluating the merits and risks of its investment and has the ability to bear the economic risks of its investment. 



        (e)    Legends.    The Holder understands that the Securities, and any
securities issued in respect thereof or exchange therefor, may bear one or all of the following legends: 



          (i)  "THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AND HAVE BEEN
ACQUIRED FOR INVESTMENT AND NOT WITH A VIEW TO, OR IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. NO SUCH SALE OR DISTRIBUTION MAY BE EFFECTED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT
RELATED THERETO OR AN OPINION OF COUNSEL IN A FORM SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED UNDER THE SECURITIES ACT OF 1933." 


         (ii)  Any legend required by the Blue Sky laws of any state to the extent such laws are applicable to the shares represented
by the certificate so legended. 




        (f)    Lock-up Agreement.    In
connection with the initial public offering of the Company's securities and upon request of the Company or the underwriters managing such offering of the Company's securities, the Holder agrees not to
sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any securities of the Company, however or whenever acquired (other than those included in the
registration) without the prior written consent of the Company or such underwriters, as the case may be, for such period of time (not to exceed 180 days or such longer period as may be required
by the underwriters to comply with NASD Rule 2711) from the effective date of such registration as may be requested by the Company or such managing underwriters and to execute an agreement
reflecting the foregoing as may be requested by the underwriters at the time of the Company's initial public offering. 


        The
obligations described in this Section 17(f) shall apply only if all executive officers and directors of the Company, and all 1%
and greater security holders (on a basis assuming full conversion and exercise of all convertible or exercisable securities) enter into similar agreements. If the Company or the underwriter of any
public offering of the Company's securities waives or terminates any standoff or lockup restrictions imposed on any holder of securities of the Company, 



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then
such waiver or termination shall be granted to all Holders subject to standoff or lockup restrictions pro rata based on the number of shares of
Common Stock beneficially held by such holder and the Holders. From and after the date of this Warrant, the Company shall use its best efforts to ensure that all holders of capital stock of the
Company agree to be bound by terms substantially similar to those set forth in this Section 17(f). 




        18.    Notices, Transfers, Etc.    



         (a)  Any notice or written communication required or permitted to be given to the Holder may be given by certified mail or
delivered to the Holder at the address most recently provided by the Holder to the Company. 



         (b)  Subject to compliance with applicable federal and state securities laws, this Warrant may be transferred by the Holder
with respect to not less than 25% of the number of the shares of Preferred Stock purchasable hereunder, provided that the transferee is not a competitor of the Company and provided further that the
transferee agrees to be bound by all of the terms and conditions of this Warrant, including, with limitations the representations and covenants contained in  Section 17. Upon surrender of this
Warrant to the Company, together with the assignment notice annexed hereto duly executed, for transfer of this
Warrant as an entirety by the Holder, the Company shall issue a new warrant of the same denomination to the assignee. Upon surrender of this Warrant to the Company, together with the assignment hereof
properly endorsed, by the Holder for transfer with respect to a portion of the shares of Preferred Stock purchasable hereunder, the Company shall issue a new warrant to the assignee, in such
denomination as shall be requested by the Holder hereof, and shall issue to such Holder a new warrant covering the number of shares in respect of which this Warrant shall not have been transferred.
Any purported transfer in violation of this Section 18(b) shall be void. 


         (c)  In case this Warrant shall be mutilated, lost, stolen or destroyed, the Company shall issue a new warrant of like tenor
and denomination and deliver the same (i) in exchange and substitution for and upon surrender and cancellation of any mutilated Warrant, or (ii) in lieu of any Warrant lost, stolen or
destroyed, upon receipt of an affidavit of the Holder or other evidence reasonably satisfactory to the Company of the loss, theft or destruction of such Warrant 




        19.    No Impairment.    The Company will not,
by amendment of its Articles or through any reclassification, capital reorganization, consolidation, merger, sale or conveyance of assets, dissolution, liquidation, issue or sale of securities or any
other voluntary action, avoid or seek to avoid the observance of performance of any of the terms of this Warrant. 



        20.    Governing Law.    The provisions and terms of this Warrant
shall be governed by and construed in accordance with the internal laws of the State of California without giving effect to its principles regarding conflicts of laws. 


        21.    Successors and Assigns.    This Warrant shall be binding upon
the Company's successors and assigns and shall inure to the benefit of the Holder's successors, legal representatives and permitted assigns. 



        22.    Business Days.    If the last or appointed day for the taking
of any action required or the expiration of any rights granted herein shall be a Saturday or Sunday or a legal holiday in California, then such action may be taken or right may be exercised on the
next succeeding day which is not a Saturday or Sunday or such a legal holiday. 


        23.    Qualifying Public Offering.    If the Company shall effect a
firm commitment underwritten public offering of shares of Common Stock which results in the conversion of the Preferred Stock into Common Stock pursuant to the Company's Articles in effect immediately
prior to such offering, then, effective upon such conversion, this Warrant shall change from the right to purchase shares of 


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Preferred
Stock to the right to purchase shares of Common Stock, and the Holder shall thereupon have the right to purchase, at a total price equal to that payable upon the exercise of this Warrant in
full, the number of shares of Common Stock which would have been receivable by the Holder upon the exercise of this Warrant for shares of Preferred Stock immediately prior to such conversion of such
shares of Preferred Stock into shares of Common Stock, and in such event appropriate provisions shall be made with respect to the rights and interest of the Holder to the end that the provisions
hereof (including, without limitation, the provisions for the adjustment of the Purchase Price and of the number of shares purchasable upon exercise of this Warrant and the provisions relating to the
net issue election) shall thereafter be applicable to any shares of Common Stock deliverable upon the exercise hereof. 



        24.    Value.    The Company and the Holder agree that the value of
this Warrant on the date of grant is $100. 



	 	 	ANACOR PHARMACEUTICALS, INC.
	

 	
 	

By:	
 	

/s/ LUCY DAY

	

 	
 	

Name:	
 	

Lucy O. Day
	

 	
 	

Title:	
 	

CFO




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Subscription    
    



	To:	 	 	 	 
	 	 	
	 	 
	

Date:	
 	

 	
 	

 
	 	 	
	 	 
	

The undersigned hereby subscribes for                        shares of Preferred Stock covered by this Warrant. The certificate(s)
for such shares shall be issued in the name of the undersigned or as otherwise indicated below:
	

 
 Signature	
 	

 
	

 
 Name for Registration	
 	

 
	

 
 Mailing Address	
 	

 




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Net Issue Election Notice    
    



	To:	 	 
	 	 	 	Date:	 	 

	

The undersigned hereby elects under Section 4 to surrender the right to purchase shares of Preferred Stock pursuant to this Warrant. The certificate(s) for such shares issuable upon such net issue
election shall be issued in the name of the undersigned or as otherwise indicated below:
	

 
 Signature	
 	

 	
 	

 	
 	

 
	

 
 Name for Registration	
 	

 	
 	

 	
 	

 
	

 
 Mailing Address	
 	

 	
 	

 	
 	

 




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Assignment    
    


        For value received                        hereby
sells, assigns and transfers unto










 






[Please print or typewrite name and address of Assignee] 











the within Warrant, and does hereby irrevocably constitute and appoint                        its attorney to transfer the within
Warrant on the books of the within named Company with full power of
substitution on the premises. 



	Dated:	 	 
	 	 
	

 
 Signature	
 	

 
	

 
 Name for Registration	
 	

 
	

In the Presence of:	
 	

 
	

 
	
 	

 




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Exhibit A    
    
    Amended and Restated Certificate of Incorporation    
    


See Exhibit 3.1 of S-1  


1











Exhibit B  


 Anacor Pharmaceuticals, Inc.

Capitalization Table

At June 30, 2006  



	 
	 	Common

Shares
	 	Exercised

Options
	 	Total

Common
	 	Granted

Options
	 	$0.7095

P/S A-1
	 	P/S A-2
	 	1.19784

adj to

$0.91

P/S B
	 	$0.89 P/S C
	 	$1.73 P/S D
	 	Total

Shares
	 	%
	 	Market Cap

(fully

diluted)

	Common SH's	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Shapiro	 	2,000,000	 	 	 	2,000,000	 	90,000	 	 	 	 	 	 	 	84,269	 	72,254	 	2,246,523	 	4.2	%	 
	 	Benkovic	 	2,000,000	 	 	 	2,000,000	 	165,000	 	 	 	 	 	 	 	84,269	 	72,254	 	2,321,523	 	4.4	%	 
	 	Poste	 	334,748	 	 	 	334,748	 	 	 	 	 	 	 	 	 	 	 	 	 	334,748	 	0.6	%	 
	 	McAdams	 	115,000	 	 	 	115,000	 	 	 	 	 	 	 	 	 	 	 	 	 	115,000	 	0.2	%	 
	 	Rosenberg	 	100,000	 	 	 	100,000	 	62,550	 	 	 	 	 	 	 	 	 	 	 	162,550	 	0.3	%	 
	 	Baker	 	76,000	 	 	 	76,000	 	80,000	 	 	 	 	 	 	 	 	 	 	 	156,000	 	0.3	%	 
	 	Perry	 	54,728	 	1,037,315	 	1,092,043	 	1,641,130	 	 	 	 	 	 	 	 	 	 	 	2,733,173	 	5.2	%	 
	 	Total common	 	4,680,476	 	1,037,315	 	5,717,791	 	2,038,680	 	 	 	 	 	 	 	 	 	 	 	 	 	15.2	%	 
	Preferred SH's	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Rho Ventures IV, L.P.	 	 	 	 	 	 	 	 	 	317,658	 	 	 	330,225	 	1,097,348	 	133,046	 	1,878,277	 	 	 	 
	 	Rho Ventures IV GmbH	 	 	 	 	 	 	 	 	 	779,365	 	 	 	810,197	 	2,692,312	 	326,424	 	4,608,298	 	 	 	 
	 	Rho Ventures IV (QP) LP	 	 	 	 	 	 	 	 	 	747,848	 	 	 	777,432	 	2,583,436	 	313,224	 	4,421,940	 	 	 	 
	 	Rho Management Trust I	 	 	 	 	 	 	 	 	 	692,127	 	 	 	719,507	 	2,390,949	 	289,886	 	4,092,469	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	2,536,998	 	 	 	 	 	 	 	 	 	 	 	28.3	%	 
	 	Aberdare Ventures II, LP	 	 	 	 	 	 	 	 	 	1,588,861	 	 	 	1,651,717	 	2,902,687	 	468,326	 	6,611,591	 	 	 	 
	 	Aberdare Bermuda	 	 	 	 	 	 	 	 	 	36,018	 	 	 	37,442	 	65,800	 	10,616	 	149,877	 	 	 	 
	 	Paul Klingenstein	 	 	 	 	 	 	 	 	 	64,832	 	 	 	67,396	 	118,440	 	19,109	 	269,778	 	 	 	 
	 	John Odden	 	 	 	 	 	 	 	 	 	1,620	 	 	 	1,684	 	2,961	 	478	 	6,742	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	1,691,331	 	 	 	 	 	 	 	 	 	 	 	13.3	%	 
	 	Venrock Partners LP	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1,454,831	 	110,908	 	1,565,739	 	 	 	 
	 	Venrock Associates IV	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	7,133,933	 	543,848	 	7,677,781	 	 	 	 
	 	Venrock Entrepreneurs	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	175,281	 	13,362	 	188,643	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	17.85	 	 
	 	Care Capital Investments	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	6,308,784	 	480,942	 	6,789,726	 	 	 	 
	 	Care Capital Offshore	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	432,809	 	32,995	 	465,804	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	13.7	 	 
	 	Red Abbey QP	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	379,466	 	28,928	 	408,394	 	 	 	 
	 	Red Abbey Venture Part	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	105,573	 	8,048	 	113,621	 	 	 	 
	 	Red Abbey CEO's Fund	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	20,579	 	1,569	 	22,148	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	1.0	%	 
	 	VLGI/HEWM	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	39,325	 	2,998	 	42,323	 	0.1	%	 
	 	Mark Weeks	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	16,853	 	1,285	 	18,138	 	0.0	%	 
	PSRF License agt (A-2)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	Penn State	 	 	 	 	 	 	 	 	 	 	 	599,023	 	 	 	 	 	 	 	599,023	 	1.1	%	 
	 	Stanford	 	 	 	 	 	 	 	 	 	 	 	599,023	 	 	 	 	 	 	 	599,023	 	1.1	%	 
	 	Total issued under lic agt	 	 	 	 	 	 	 	 	 	 	 	1,198,046	 	 	 	 	 	 	 	 	 	 	 	 
	Stock Option Holders	 	 	 	143,368	 	200,034	 	2,909,537	 	 	 	 	 	 	 	 	 	 	 	3,109,571	 	4.6	%	 
	Warrant (Lighthouse—lender)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	300,578	 	 	 	 
	Total issued (options granted)	 	4,680,476	 	1,324,051	 	6,004,527	 	2,909,537	 	4,228,329	 	1,198,046	 	4,395,600	 	28,089,885	 	 	 	52,006,962	 	98.3	%	 
	 	Options authorized but not granted	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	46,825,924	 	 	 	 	 	0.0	%	 
	 	Total options, avail for grant	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	916,147	 	1.7	%	 
	 	Fully diluted shares, including outstanding option pool	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	52,925,123	 	100.0	%	91,890,473




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Exhibit C    
    Amended And Restated Investors' Rights Agreement    
    


See Exhibit 4.2 of S-1  


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