Document:

Exhibit 10.8.2

 

CONFIDENTIAL TREATMENT REQUESTED

 

Execution Version

 

PLEDGE AND SECURITY AGREEMENT

 

This PLEDGE AND SECURITY AGREEMENT, dated as of April 18, 2013 (as amended, supplemented or otherwise modified from time to time, this “Security Agreement”), is made by NATERA, INC., a Delaware corporation (the “Borrower”) and NATERA INTERNATIONAL, INC. (together with the Borrower and with any other entity that may become a party hereto as provided herein, each a “Grantor” and, collectively, the “Grantors”) in favor of ROS ACQUISITION OFFSHORE LP, a Cayman Islands Exempted Limited Partnership, for itself and as agent for the other parties to which the Grantors may owe any Obligations (together with its Affiliates, successors, transferees and assignees, the “Lender”).

 

W  I  T  N  E  S  S  E  T  H :

 

WHEREAS, pursuant to the Credit Agreement, dated as of April 18, 2013 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and between the Borrower and the Lender, the Lender has extended a Commitment to make Loans to the Borrower; and

 

WHEREAS, as a condition precedent to the making of the Initial Loan under the Credit Agreement, each Grantor is required to execute and deliver this Security Agreement;

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, each Grantor agrees, for the benefit of the Lender, as follows:

 

ARTICLE I
 DEFINITIONS

 

SECTION 1.1. Certain Terms. The following terms (whether or not underscored) when used in this Security Agreement, including its preamble and recitals, shall have the following meanings (such definitions to be equally applicable to the singular and plural forms thereof):

 

“Borrower” is defined in the preamble.

 

“Collateral” is defined in Section 2.1.

 

“Collateral Accounts” is defined in clause (b) of Section 4.3.

 

“Computer Hardware and Software Collateral” means (a) all of the Grantors’ computer and other electronic data processing hardware, integrated computer systems, central processing units, memory units, display terminals, printers, features, computer elements, card readers, tape drives, hard and soft disk drives, cables, electrical supply hardware, generators, power  equalizers, accessories and all peripheral devices and other related computer hardware, including all operating system software, utilities and application programs in whatsoever form; (b) all software programs (including both source code, object code and all related applications and data files) designed for use on the computers and electronic data processing hardware described in clause (a) above; (c) all firmware associated therewith; (d) all documentation (including flow

 

 

charts, logic diagrams, manuals, guides, specifications, training materials, charts and pseudo codes) with respect to such hardware, software and firmware described in the preceding clauses (a) through (c); and (e) all rights with respect to all of the foregoing, including copyrights, licenses, options, warranties, service contracts, program services, test rights, maintenance rights, support rights, improvement rights, renewal rights and indemnifications and any substitutions, replacements, improvements, error corrections, updates, additions or model conversions of any of the foregoing.

 

“Control Agreement” means an authenticated record in form and substance reasonably satisfactory to the Lender, that provides for the Lender to have “control” (as defined in the UCC) over certain Collateral.

 

“Copyright Collateral” means all copyrights of the Grantors, whether statutory or common law, whether registered or unregistered and whether published or unpublished, now or hereafter in force throughout the world including all of the Grantors’ rights, titles and interests in and to all copyrights registered in the United States Copyright Office or anywhere else in the world, including the copyrights referred to in Item A of Schedule V, and registrations and recordings thereof and all applications for registration thereof, whether pending or in preparation, all copyright licenses, including each copyright license referred to in Item B of Schedule V, the right to sue for past, present and future infringements of any of the foregoing, all rights corresponding thereto, all extensions and renewals of any thereof and all Proceeds of the foregoing, including licenses, royalties, income, payments, claims, damages and Proceeds of suit, which are owned or licensed by the Grantors.

 

“Credit Agreement” is defined in the first recital.

 

“Distributions” means all dividends paid on Capital Securities, liquidating dividends paid on Capital Securities, shares (or other designations) of Capital Securities resulting from (or in connection with the exercise of) stock splits, reclassifications, warrants, options, non-cash dividends, mergers, consolidations, and all other distributions (whether similar or dissimilar to the foregoing) on or with respect to any Capital Securities constituting Collateral.

 

“Filing Statements” is defined in clause (b) of Section 3.7.

 

“General Intangibles” means all “general intangibles” and all “payment intangibles”, each as defined in the UCC, and shall include all interest rate or currency protection or hedging arrangements, all tax refunds, all licenses, permits, concessions and authorizations and all Intellectual Property Collateral (in each case, regardless of whether characterized as general intangibles under the UCC).

 

“Grantor” and “Grantors” are defined in the preamble.

 

“Intellectual Property Collateral” means, collectively, the Computer Hardware and Software Collateral, the Copyright Collateral, the Patent Collateral, the Trademark Collateral, the Trade Secrets Collateral, Product Agreements and Regulatory Authorizations.

 

“Intercompany Note” means any promissory note evidencing loans made by any Grantor to any other Grantor.

 

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“Investment Property” means, collectively, (a) all “investment property” as such term is defined in Section 9-102(a)(49) of the UCC and (b) whether or not constituting “investment property” as so defined, all Pledged Notes.

 

“Lender” is defined in the preamble. 

 

“Patent Collateral” means:

 

(a)           all of the Grantors’ (i) inventions and discoveries, whether patentable or not, and (ii) letters patent and applications for letters patent throughout the world, including all patent applications in preparation for filing and each patent and patent application referred to in Item A of Schedule III;

 

(b)           all reissues, divisions, continuations, continuations-in-part, extensions, renewals and reexaminations of any of the items described in clause (a);

 

(c)           all patent licenses, and other agreements providing any Grantor with the right to use any items of the type referred to in clauses (a) and (b) above, including each patent license referred to in Item B of Schedule III; and

 

(d)           all Proceeds of, and rights associated with, the foregoing (including licenses, royalties income, payments, claims, damages and Proceeds of infringement suits) and the right to sue third parties for past, present or future infringements of any patent or patent application and for breach or enforcement of any patent license.

 

“Permitted Liens” means all Liens permitted by Section 8.3 of the Credit Agreement.

 

“Pledged Notes” means all promissory notes listed on Item J of Schedule II (as such schedule may be amended or supplemented from time to time), all Intercompany Notes at any time issued to any Grantor and all other promissory notes issued to or held by any Grantor.

 

“Securities Act” is defined in clause (a) of Section 6.2.  

 

“Security Agreement” is defined in the preamble.

 

“Trade Secrets Collateral” means all of the Grantors’ common law and statutory trade secrets and all other confidential, proprietary or useful information, and all know-how obtained by or used in or contemplated at any time for use in the business of any Grantor (all of the foregoing being collectively called a “Trade Secret”), whether or not such Trade Secret has been reduced to a writing or other tangible form, including all documents and things embodying, incorporating or referring in any way to such Trade Secret, all Trade Secret licenses, and including the right to sue for and to enjoin and to collect damages for the actual or threatened misappropriation of any Trade Secret and for the breach or enforcement of any such Trade Secret license.

 

“Trademark Collateral” means :

 

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(a)           (i) all of the Grantors’ trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, certification marks, collective marks, logos and other source or business identifiers, and all goodwill of the business associated therewith, now existing or hereafter adopted or acquired including those referred to in Item A of Schedule IV, whether currently in use or not, all registrations and recordings thereof and all applications in connection therewith, whether pending or filed, including registrations, recordings and applications in the United States Patent and Trademark Office or in any office or agency of the United States of America, or any State thereof or any other country or political subdivision thereof or otherwise, and all common-law rights relating to the foregoing, and (ii) the right to obtain all reissues, extensions or renewals of the foregoing (collectively referred to as the “Trademarks”);

 

(b)           all Trademark licenses for the grant by or to any Grantors of any right to use any Trademark, including each Trademark license referred to in Item B of Schedule IV; and

 

(c)           all of the goodwill of the business connected with the use of, and symbolized by the items described in, clause (a), and to the extent applicable clause (b);

 

(d)           the right to sue third parties for past, present and future infringements of any Trademark Collateral described in clause (a) and, to the extent applicable, clause (b); and

 

(e)           all Proceeds of, and rights associated with, the foregoing, including any claim by any Grantor against third parties for past, present or future infringement or dilution of any Trademark, Trademark registration or Trademark license, or for any injury to the goodwill associated with the use of any such Trademark or for breach or enforcement of any Trademark license and all rights corresponding thereto throughout the world.

 

SECTION 1.2. Credit Agreement Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Security Agreement, including its preamble and recitals, have the meanings provided in the Credit Agreement.

 

SECTION 1.3. UCC Definitions. When used herein the terms “Account”, “Certificate of Title”, “Certificated Securities”, “Chattel Paper”, “Commercial Tort Claim”, “Commodity Account”, “Commodity Contract”, “Deposit Account”, “Document”, “Electronic Chattel Paper”, “Equipment”, “Goods”, “Instrument”, “Inventory”, “Letter-of-Credit Rights”, “Payment Intangibles”, “Proceeds”, “Promissory Notes”, “Securities Account”, “Security Entitlement”, “Supporting Obligations” and “Uncertificated Securities” have the meaning provided in Article 8 or Article 9, as applicable, of the UCC. “Letters of Credit” has the meaning provided in Section 5-102 of the UCC.

 

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ARTICLE II
 SECURITY INTEREST

 

SECTION 2.1. Grant of Security Interest. Each Grantor hereby grants to the Lender, for its benefit, a continuing security interest in all of such Grantor’s right, title and interest in and to the following property, whether now or hereafter existing, owned or acquired by such Grantor, and wherever located, (collectively, the “Collateral”):

 

(a)             Accounts;

 

(b)             Chattel Paper;

 

(c)             Commercial Tort Claims listed on Item I of Schedule II (as such schedule may be amended or supplemented from time to time);

 

(d)             Deposit Accounts;

 

(e)             Documents;

 

(f)             General Intangibles;

 

(g)             Goods (including Goods held on consignment with third parties);

 

(h)             Instruments;

 

(i)              Investment Property;

 

(j)              Letter-of-Credit Rights and Letters of Credit;

 

(k)             Supporting Obligations;

 

(l)              all books, records, writings, databases, information and other property relating to, used or useful in connection with, evidencing, embodying, incorporating or referring to, any of the foregoing in this Section;

 

(m)           all Proceeds of the foregoing and, to the extent not otherwise included, (A) all payments under insurance (whether or not the Lender is the loss payee thereof) in respect of Collateral and (B) all tort claims; and

 

(n)             all other property and rights of every kind and description and interests therein.

 

Notwithstanding the foregoing, the term “Collateral” shall not include:

 

(i)         any General Intangibles or other rights arising under any contracts,  instruments, licenses or other documents as to which the grant of a security interest would (A) constitute a violation of a valid and enforceable restriction in favor of a third party on such grant, unless and until any required consents shall

 

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have been obtained, or (B) give any other party to such contract, instrument, license or other document the right to terminate its obligations thereunder;

 

(ii)             trademark applications filed in the United States Patent and Trademark Office on the basis of such Grantor’s “intent to use” such trademark, unless and until acceptable evidence of use of the Trademark has been filed with the United States Patent and Trademark Office pursuant to Section 1(c) or Section 1(d) of the Lanham Act (15 U.S.C. 1051, et seq.), to the extent that granting a Lien in such Trademark application prior to such filing would adversely affect the enforceability or validity of such Trademark application;

 

(iii)            any asset, the granting of a security interest in which would be void or illegal under any applicable governmental law, rule or regulation, or pursuant thereto would result in, or permit the termination of, such asset; or

 

(iv)            any asset subject to a Permitted Lien (other than Liens in favor of the Lender) securing obligations permitted under the Credit Agreement to the extent that the grant of other Liens on such asset (A) would result in a breach or violation of, or constitute a default under, the agreement or instrument governing such Permitted Lien, (B) would result in the loss of use of such asset or (C) would permit the holder of such Permitted Lien to terminate the Grantor’s use of such asset;

 

provided, that the property described in paragraphs (i), (iii) and (iv) above shall only be excluded from the term “Collateral” to the extent the conditions stated in such paragraphs are not rendered ineffective pursuant to Sections 9-406, 9-407, 9-408 or 9-409 of the UCC or any other applicable law.

 

SECTION 2.2. Security for Obligations. This Security Agreement and the Collateral in which the Lender is granted a security interest hereunder by the Grantors secure, on an equal and ratable basis, the payment and performance of all of the Obligations.

 

SECTION 2.3. Grantors Remain Liable. Anything herein to the contrary notwithstanding:

 

(a)             the Grantors will remain liable under the contracts and agreements included in the Collateral to the extent set forth therein, and will perform all of their duties and obligations under such contracts and agreements to the same extent as if this Security Agreement had not been executed;

 

(b)             the exercise by the Lender of any of its rights hereunder will not release any Grantor from any of its duties or obligations under any such contracts or agreements included in the Collateral; and

 

(c)             the Lender will not have any obligation or liability under any contracts or agreements included in the Collateral by reason of this Security Agreement, nor will the Lender be obligated to perform any of the obligations or duties of any Grantor thereunder or to take any action to collect or enforce any claim for payment assigned hereunder.

 

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SECTION 2.4. Distributions on Capital Securities In the event that any Distribution with respect to any Capital Securities pledged hereunder is permitted to be paid pursuant to Section 8.6 of the Credit Agreement, such Distribution or may be paid directly to the applicable Grantor. If any Distribution is made in contravention of Section 8.6 of the Credit Agreement, such Grantor shall hold the same segregated and in trust for the Lender until paid to the Lender in accordance with Section 4.1.5.

 

SECTION 2.5. Security Interest Absolute, etc. This Security Agreement shall in all respects be a continuing, absolute, unconditional and irrevocable grant of security interest, and shall remain in full force and effect until the Termination Date. All rights of the Lender and the security interests granted to the Lender hereunder, and all obligations of the Grantors hereunder, shall, to the fullest extent permitted by applicable law, in each case, be absolute, unconditional and irrevocable irrespective of:

 

(a)             any lack of validity, legality or enforceability of any Loan Document (other than this Security Agreement);

 

(b)             the failure of the Lender (i) to assert any claim or demand or to enforce any right or remedy against the Borrower or any of the Subsidiaries or any other Person (including any other Grantor) under the provisions of any Loan Document or otherwise, or (ii) to exercise any right or remedy against any other guarantor (including any other Grantor) of, or Collateral securing, any Obligations;

 

(c)             any change in the time, manner or place of payment of, or in any other term of, all or any part of the Obligations, or any other extension, compromise or renewal of any Obligations;

 

(d)             any reduction, limitation, impairment or termination of any Obligations for any reason, including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to (and each Grantor hereby waives, until payment of all Obligations, any right to or claim of) any defense or setoff, counterclaim, recoupment or termination whatsoever by reason of the invalidity, illegality, nongenuineness, irregularity, compromise, unenforceability of, or any other event or occurrence affecting, any Obligations or otherwise;

 

(e)             any amendment to, rescission, waiver, or other modification of, or any consent to or departure from, any of the terms of any Loan Document;

 

(f)             any addition, exchange or release of any Collateral or of any Person that is (or will become) a Grantor (including the Grantors hereunder), or any surrender or non-perfection of any Collateral, or any amendment to or waiver or release or addition to, or consent to or departure from, any other guaranty held by the Lender securing any of the Obligations; or

 

(g)             any other circumstance which might otherwise constitute a defense available to, or a legal or equitable discharge of the Borrower or any of the Subsidiaries, any surety or any guarantor.

 

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SECTION 2.6. Postponement of Subrogation. Each Grantor agrees that it will not exercise any rights against another Grantor which it may acquire by way of rights of subrogation under any Loan Document to which it is a party until following the Termination Date. No Grantor shall seek or be entitled to seek any contribution or reimbursement from the Borrower or any of the Subsidiaries, in respect of any payment made under any Loan Document or otherwise, until following the Termination Date. Any amount paid to any Grantor on account of any such subrogation rights prior to the Termination Date shall be held in trust for the benefit of the Lender and shall immediately be paid and turned over to the Lender in the exact form received by such Grantor (duly endorsed in favor of the Lender, if required), to be credited and applied against the Obligations, whether matured or unmatured, in accordance with Section 6.1(b); provided that if such Grantor has made payment to the Lender of all or any part of the Obligations and the Termination Date has occurred, then at such Grantor’s request, the Lender will, at the expense of such Grantor, execute and deliver to such Grantor appropriate documents (without recourse and without representation or warranty) necessary to evidence the transfer by subrogation to such Grantor of an interest in the Obligations resulting from such payment. In furtherance of the foregoing, at all times prior to the Termination Date, such Grantor shall refrain from taking any action or commencing any proceeding against the Borrower or any of the Subsidiaries (or their successors or assigns, whether in connection with a bankruptcy proceeding or otherwise) to recover any amounts in respect of payments made under this Security Agreement to the Lender.

 

ARTICLE III
 REPRESENTATIONS AND WARRANTIES

 

In order to induce the Lender to enter into the Credit Agreement and make the Loans thereunder, the Grantors represent and warrant to the Lender as set forth below.

 

SECTION 3.1. As to Capital Securities of the Subsidiaries, Investment Property.

 

(a)           With respect to any Subsidiary of any Grantor that is

 

(i)            a corporation, business trust, joint stock company or similar Person, all Capital Securities issued by such Subsidiary are duly authorized and validly issued, fully paid and non-assessable, and represented by a certificate or certificates; and

 

(ii)           a partnership or limited liability company, no Capital Securities issued by such Subsidiary (A) is dealt in or traded on securities exchanges or in securities markets, (B) expressly provides that such Capital Securities is a security governed by Article 8 of the UCC or (C) is held in a Securities Account, except, with respect to this clause (a)(ii), Capital Securities (x) for which the Lender is the registered owner or (y) with respect to which the issuer has agreed in an authenticated record with such Grantor and the Lender to comply with any instructions of the Lender without the consent of such Grantor.

 

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(b)           Each Grantor has delivered all Certificated Securities constituting Collateral held by such Grantor in a Subsidiary on the later of the Closing Date or the date such Grantor becomes a party to this Security Agreement to the Lender, together with duly executed undated blank stock powers, or other equivalent instruments of transfer acceptable to the Lender.

 

(c)           With respect to Uncertificated Securities constituting Collateral owned by any Grantor in a Subsidiary on the later of the Closing Date or the date such Grantor becomes a party to this Security Agreement, such Grantor has caused the issuer thereof to agree in an authenticated record with such Grantor and the Lender that such issuer will comply with instructions with respect to such security originated by the Lender without further consent of such Grantor (which instructions the Lender hereby agrees not to give unless an Event of Default has occurred and is continuing). Each party hereto that is such an issuer of any Uncertificated Securities hereby agrees that such party will comply with instructions with respect to such security originated by the Lender (which instructions the Lender hereby agrees not to give unless an Event of Default has occurred and is continuing).

 

(d)           The percentage of the issued and outstanding Capital Securities of each Subsidiary pledged on the Closing Date by each Grantor hereunder is as set forth on Schedule I. All shares of such Capital Securities have been duly and validly issued and are fully paid and nonassessable.

 

(e)           Each of the Intercompany Notes constitutes the legal, valid and binding obligation of the obligor with respect thereto, enforceable in accordance with its terms, subject to the effects of bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and other similar laws relating to or affecting creditors’ rights generally, general equitable principles (whether considered in a proceeding in equity or at law) and an implied covenant of good faith and fair dealing.

 

SECTION 3.2. Grantor Name, Location, etc. In each case as of the date hereof:

 

(a)           (i) The jurisdiction in which each Grantor is located for purposes of Sections 9-301 and 9-307 of the UCC and (ii) the address of each Grantor’s executive office and principal place of business is set forth in Item A of Schedule II.

 

(b)           The Grantors do not have any trade names other than those set forth in Item C of Schedule II hereto.

 

(c)           During the twelve months preceding the later of (i) the date hereof or (ii) the date such Grantor becomes a party to this Security Agreement, no Grantor has been known by any legal name different from the one set forth on the signature page hereto, nor has such Grantor been the subject of any merger or other corporate reorganization, except as set forth in Item D of Schedule II hereto.

 

(d)           Each Grantor’s federal taxpayer identification number (or foreign equivalent) is (and, during the twelve months preceding the date hereof, such Grantor has

 

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not had a federal taxpayer identification number (or equivalent) different from that) set forth in Item E of Schedule II hereto.

 

(e)               No Grantor is a party to any federal, state or local government contract except as set forth in Item F of Schedule II hereto.

 

(f)               No Grantor maintains any Deposit Accounts, Securities Accounts or Commodity Accounts with any Person, in each case, except as set forth on Item G of Schedule II.

 

(g)               No Grantor is the beneficiary of any Letters of Credit, except as set forth on Item H of Schedule II.

 

(h)               No Grantor has Commercial Tort Claims except as set forth on Item I of Schedule II.

 

(i)                The name set forth on the signature page attached hereto is the true and correct legal name (as defined in the UCC) of each Grantor.

 

SECTION 3.3. Ownership, No Liens, etc. Each Grantor owns its Collateral purported to be owned by it free and clear of any Lien, except for any security interest (a) created by this Security Agreement and (b) Permitted Liens. No effective UCC financing statement or other filing similar in effect covering all or any part of the Collateral is on file in any recording office, except those filed in favor of the Lender relating to this Security Agreement, Permitted Liens or as to which a duly authorized termination statement relating to such UCC financing statement or other instrument has been delivered to the Lender on the Closing Date.

 

SECTION 3.4. Possession of Inventory, Control; etc.

 

(a)               Each Grantor has, and agrees that it will maintain, exclusive possession of  its Documents, Instruments, Promissory Notes, Equipment and Inventory, other than (i) Equipment and Inventory that is in transit in the ordinary course of business, (ii) Equipment and Inventory that in the ordinary course of business is in the possession or control of a warehouseman, bailee agent or other Person (other than a Person controlled by or under common control with such Grantor) that has been notified of the security interest created in favor of the Lender pursuant to this Security Agreement and has authenticated a record acknowledging that it holds possession of such Collateral for the Lender’s benefit and waives any Lien held by it against such Collateral, (iii) Inventory that is in the possession of a consignee in the ordinary course of business and (iv) Instruments or Promissory Notes that have been delivered to the Lender pursuant to Section 3.5. In the case of Equipment or Inventory described in clause (ii) above, no lessor or warehouseman of any premises or warehouse upon or in which such Equipment or Inventory is located has (x) issued any warehouse receipt or other receipt in the nature of a warehouse receipt in respect of any such Equipment or Inventory, (y) issued any Document for any such Equipment or Inventory or (z) any Lien (other than Permitted Liens) on any such Equipment or Inventory.

 

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(b)               Each Grantor is the sole entitlement holder of its Deposit Accounts and no  other Person (other than the Lender pursuant to this Security Agreement or any other Person with respect to Permitted Liens) has control or possession of, or any other interest in, any of its Deposit Accounts or any other securities or property credited thereto.

 

SECTION 3.5. Negotiable Documents, Instruments and Chattel Paper. Each Grantor has delivered to the Lender possession of all originals of all Documents, Instruments, Promissory Notes, and tangible Chattel Paper (other than any Document, Instrument, Promissory Note or tangible Chattel Paper not exceeding $10,000 in principal amount) owned or held by such Grantor on the Closing Date.

 

SECTION 3.6. Intellectual Property Collateral. Except as disclosed on Schedules III through VI, with respect to any Intellectual Property Collateral:

 

(a)           such Grantor has not made a previous assignment, sale, transfer or agreement constituting a present or future assignment, sale or transfer of any Intellectual Property for purposes of granting a security interest or as Collateral that has not been terminated or releasedt; and

 

(b)           such Grantor has executed and delivered to the Lender Intellectual Property Collateral security agreements for all Copyrights, Patents and Trademarks owned by such Grantor, including all Copyrights, Patents and Trademarks on Schedule III through VI (as such schedules may be amended or supplemented from time to time by notice by such Grantor to the Lender).

 

SECTION 3.7. Validity, etc.

 

(a)           This Security Agreement creates a valid security interest in the Collateral securing the payment of the Obligations to the extent such security interest may be created pursuant to Article 9 of the UCC.

 

(b)           As of the Closing Date, each Grantor has filed or caused to be filed all UCC-1 financing statements in the filing office for each Grantor’s jurisdiction of organization listed in Item A of Schedule II (collectively, the “Filing Statements”) (delivered to the Lender the Filing Statements suitable for timely and proper filing in such offices) and has taken all other actions requested by the Lender necessary for the Lender to obtain control of the Collateral as provided in Sections 9-104, 9-105, 9-106 and 9-107 of the UCC.

 

(c)           Upon the filing of the Filing Statements with the appropriate agencies therefor the security interests created under this Security Agreement shall constitute a perfected security interest in the Collateral described on such Filing Statements in favor of the Lender to the extent that a security interest therein may be perfected by filing a financing statement pursuant to the relevant UCC, prior to all other Liens, except for Permitted Liens (in which case such security interest shall be second in priority of right only to the Permitted Liens entitled to priority).

 

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SECTION 3.8. Authorization, Approval, etc. Except as have been obtained or made and are in full force and effect, no authorization, approval or other action by, and no notice to or filing with, any Governmental Authority or any other third party is required either

 

(a)           for the grant by the Grantors of the security interest granted hereby or for the execution, delivery and performance of this Security Agreement by the Grantors;

 

(b)           for the perfection or maintenance of the security interests hereunder (except with respect to the Filing Statements or, with respect to Intellectual Property Collateral, the recordation of any agreements with the United States Patent and Trademark Office or the United States Copyright Office or, with respect to foreign Intellectual Property Collateral, the taking of appropriate action under applicable foreign law and, with respect to after-acquired Intellectual Property Collateral, any subsequent filings in United States intellectual property offices); or

 

(c)           for the exercise by the Lender of the voting or other rights provided for in this Security Agreement, except (i) with respect to any securities issued by a Subsidiary of the Grantors, as may be required in connection with a disposition of such securities by laws affecting the offering and sale of securities generally, the remedies in respect of the Collateral pursuant to this Security Agreement and (ii) any “change of control” or similar filings required by state licensing agencies.

 

SECTION 3.9. Best Interests. It is in the best interests of each Grantor (other than the Borrower) to execute this Security Agreement inasmuch as such Grantor will, as a result of being an Affiliate of the Borrower, derive substantial direct and indirect benefits from the Loans made to the Borrower by the Lender pursuant to the Credit Agreement, and each Grantor agrees that the Lender is relying on this representation in agreeing to make such Loans pursuant to the Credit Agreement to the Borrower.

 

ARTICLE IV
 COVENANTS

 

Each Grantor covenants and agrees that, until the Termination Date, such Grantor will perform, comply with and be bound by the obligations set forth below.

 

SECTION 4.1. As to Investment Property, etc.

 

SECTION 4.1.1. Capital Securities of Subsidiaries. No Grantor will allow any of its Subsidiaries:

 

(a)           [Omitted];

 

(b)           that is a partnership or limited liability company, to (i) issue Capital Securities that are to be dealt in or traded on securities exchanges or in securities markets, (ii) expressly provide in its Organic Documents that its Capital Securities are securities

 

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governed by Article 8 of the UCC, or (iii) place such Subsidiary’s Capital Securities in a Securities Account; and

 

(c)             to issue Capital Securities in addition to or in substitution for the Capital Securities pledged hereunder, except to such Grantor (and such Capital Securities are immediately pledged and delivered to the Lender pursuant to the terms of this Security Agreement).

 

SECTION 4.1.2. Investment Property (other than Certificated Securities).

 

(a)             With respect to any Deposit Accounts, Securities Accounts, Commodity Accounts, Commodity Contracts or Security Entitlements constituting Investment Property owned or held by any Grantor, such Grantor will cause (except for Excluded Accounts) the intermediary maintaining such Investment Property to execute a Control Agreement relating to such Investment Property pursuant to which such intermediary agrees to comply with the Lender’s instructions with respect to such Investment Property without further consent by such Grantor (which instructions the Lender hereby agrees not to give unless an Event of Default has occurred and is continuing).

 

(b)             With respect to any Uncertificated Securities (other than Uncertificated Securities credited to a Securities Account) constituting Investment Property owned or held by any Grantor, such Grantor will cause the issuer of such securities that is not a party hereto to execute a Control Agreement relating to such Investment Property pursuant to which the issuer agrees to comply with the Lender’s instructions with respect to such Uncertificated Securities without further consent by such Grantor (which instructions the Lender hereby agrees not to give unless an Event of Default has occurred and is continuing). Each party hereto that is such an issuer of any Uncertificated Securities hereby agrees that such party will comply with instructions with respect to such security originated by the Lender (which instructions the Lender hereby agrees not to give unless an Event of Default has occurred and is continuing).

 

SECTION 4.1.3. Certificated Securities (Stock Powers). Each Grantor agrees that all Certificated Securities constituting Collateral, including the Capital Securities delivered by such Grantor pursuant to this Security Agreement, will be accompanied by duly executed undated blank stock powers, or other equivalent instruments of transfer reasonably acceptable to the Lender.

 

SECTION 4.1.4. Continuous Pledge. Each Grantor will (subject to the terms of the Credit Agreement) (a) deliver to the Lender all Investment Property and all Payment Intangibles to the extent that such Investment Property or Payment Intangibles are evidenced by a Document, Instrument, Promissory Note or Chattel Paper (other than any Document, Instrument, Promissory Note or Chattel Paper not exceeding $10,000 in the principal amount), and (b) at all times keep pledged to the Lender pursuant hereto, on a first-priority, perfected basis, security interest therein and in all interest and principal with respect to such Payment Intangibles, and all Proceeds and rights from time to time received by or distributable to such Grantor in respect of any of the foregoing Collateral. Each Grantor agrees that it will, promptly following receipt thereof, deliver to the Lender possession of all originals of negotiable Documents, Instruments,

 

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Promissory Notes and Chattel Paper that it acquires following the Closing Date (other than any Document, Instrument, Promissory Note or Chattel Paper not exceeding $10,000 in the principal amount).

 

SECTION 4.1.5. Voting Rights; Dividends, etc. Each Grantor agrees:

 

(a)           upon receipt of notice of the occurrence and continuance of an Event of Default from the Lender and without any request therefor by the Lender, so long as such Event of Default shall continue, to deliver (properly endorsed where required hereby or requested by the Lender) to the Lender all dividends and Distributions with respect to Investment Property, all interest, principal, other cash payments on Payment Intangibles, and all Proceeds of the Collateral, in each case thereafter received by such Grantor, all of which shall be held by the Lender as additional Collateral, except for payments made in accordance with Section 8.6 of the Credit Agreement; and

 

(b)           immediately upon the occurrence and during the continuance of an Event of Default and so long as the Lender has notified such Grantor of the Lender’s intention to exercise its voting power under this clause,

 

(i)            with respect to Collateral consisting of general partner interests or limited liability company interests, to promptly modify its Organic Documents to admit the Lender as a general partner or member, as applicable;

 

(ii)           that the Lender may exercise (to the exclusion of such Grantor) the voting power and all other incidental rights of ownership with respect to any Investment Property constituting Collateral and such Grantor hereby grants the Lender an irrevocable proxy, exercisable under such circumstances, to vote such Investment Property; and

 

(iii)          to promptly deliver to the Lender such additional proxies and other documents as may be necessary to allow the Lender to exercise such voting power.

 

All dividends, Distributions, interest, principal, cash payments, Payment Intangibles and Proceeds that may at any time and from time to time be held by such Grantor, but which such Grantor is then obligated to deliver to the Lender, shall, until delivery to the Lender, be held by such Grantor separate and apart from its other property in trust for the Lender. The Lender agrees that unless an Event of Default shall have occurred and be continuing and the Lender shall have given the notice referred to in clause (b), such Grantor will have the exclusive voting power with respect to any Investment Property constituting Collateral and the Lender will, upon the written request of such Grantor, promptly deliver such proxies and other documents, if any, as shall be reasonably requested by such Grantor which are necessary to allow such Grantor to exercise that voting power; provided that no vote shall be cast, or consent, waiver, or ratification given, or action taken by such Grantor that would impair any such Collateral or be inconsistent with or violate any provision of any Loan Document.

 

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SECTION 4.2. Change of Name, etc. No Grantor will change its name or place of incorporation or organization or federal taxpayer identification number except as otherwise permitted by the Credit Agreement.

 

SECTION 4.3. As to Accounts.

 

(a)                                 Each Grantor shall have the right to collect all Accounts so long as no Event of Default shall have occurred and be continuing.

 

(b)                                 Upon (i) the occurrence and continuance of an Event of Default and (ii) the delivery of notice by the Lender to each Grantor, all Proceeds of Collateral received by such Grantor shall be delivered in kind to the Lender for deposit in a Deposit Account of such Grantor maintained with the Lender (together with any other Deposit Accounts or Security Accounts pursuant to which any portion of the Collateral is deposited with the Lender, the “Collateral Accounts”), and such Grantor shall not commingle any such Proceeds, and shall hold separate and apart from all other property, all such Proceeds in express trust for the benefit of the Lender until delivery thereof is made to the Lender.

 

(c)                                  Following the delivery of notice pursuant to clause (b)(ii), and so long as an Event of Default shall continue, the Lender shall have the right to apply any amount in the Collateral Account to the payment of any Obligations which are then due and payable in accordance with Section 4.4(b) of the Credit Agreement.

 

(d)                                 With respect to each of the Collateral Accounts, it is hereby confirmed and agreed that (i) deposits in such Collateral Accounts are subject to a security interest as contemplated hereby, (ii) such Collateral Accounts shall be under the control of the Lender and (iii) the Lender shall have the sole right of withdrawal over such Collateral Account.

 

SECTION 4.4. As to Grantors Use of Collateral.

 

(a)                                 At any time following the occurrence and during the continuance of an Event of Default, whether before or after the maturity of any of the Obligations, the Lender may exercise any and all rights and remedies to which it is lawfully entitled with respect to the Collateral.

 

(b)                                 Upon the request of the Lender following the occurrence and during the continuance of an Event of Default, each Grantor will, at its own expense, notify any parties obligated on any of the Collateral to make payment to the Lender of any amounts due or to become due thereunder.

 

(c)                                  At any time following the occurrence and during the continuation of an Event of Default, the Lender may endorse, in the name of such Grantor, any item, howsoever received by the Lender, representing any payment on or other Proceeds of any of the Collateral.

 

SECTION 4.5. As to Intellectual Property Collateral. Each Grantor covenants and agrees to comply with the following provision:

 

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(a)                                 such Grantor will not (i) do or fail to perform any act whereby any of the Patent Collateral may lapse or become abandoned or dedicated to the public or unenforceable, (ii) permit any of its licensees to (A) fail to continue to use any of the Trademark Collateral in order to maintain all of the Trademark Collateral in full force free from any claim of abandonment for non-use, (B) fail to maintain the quality of products and services offered under all of the Trademark Collateral at a level substantially consistent with the quality of products and services offered under such Trademark as of the date hereof, (C) fail to employ all of the Trademark Collateral registered with any federal or state or foreign authority with an appropriate notice of such registration, (D) adopt or use any other Trademark which is confusingly similar or a colorable imitation of any of the Trademark Collateral, (E) use any of the Trademark Collateral registered with any federal, state or foreign authority except for the uses for which registration or application for registration of all of the Trademark Collateral has been made or (F) do or permit any act or knowingly omit to do any act whereby any of the Trademark Collateral may become invalid or unenforceable, or (iii) do or permit any act or knowingly omit to do any act whereby any of the Copyright Collateral or any of the Trade Secrets Collateral may lapse or become invalid or unenforceable or placed in the public domain except upon expiration of the end of an unrenewable term of a registration thereof, unless, in the case of any of the foregoing requirements in clauses (i), (ii) and (iii), such Grantor reasonably and in good faith determines that either (x) such Intellectual Property Collateral is of negligible economic value to such Grantor or (y) the loss of such Intellectual Property Collateral would not be material to such Grantor;

 

(b)                                 such Grantor shall promptly notify the Lender if it knows, or has reason to know, that any application or registration relating to any material item of the Intellectual Property Collateral may, in the Grantor’s reasonable commercial judgment, become abandoned or dedicated to the public or placed in the public domain or invalid or unenforceable, or of any adverse determination or development (including the institution of, or any such determination or development in, any proceeding in the United States Patent and Trademark Office, the United States Copyright Office or any foreign counterpart thereof or any court) regarding such Grantor’s ownership of any of the Intellectual Property Collateral, its right to register the same or to keep and maintain and enforce the same;

 

(c)                                  in no event will such Grantor or any of its agents, employees, designees or licensees file an application for the registration of any Intellectual Property Collateral with the United States Patent and Trademark Office, the United States Copyright Office or any similar office or agency in any other country or any political subdivision thereof, unless such Grantor promptly informs the Lender and, upon request of the Lender (subject to the terms of the Credit Agreement), executes and delivers all agreements, instruments and documents as the Lender may reasonably request to evidence the Lender’s security interest in such Intellectual Property Collateral; and

 

(d)                                 such Grantor will promptly (but no less than quarterly) execute and deliver to the Lender (as applicable) a Patent Security Agreement, Trademark Security Agreement and/or Copyright Security Agreement, as the case may be, in the forms of Exhibit A, Exhibit B and Exhibit C hereto following its obtaining an interest in any such

 

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Intellectual Property, and shall execute and deliver to the Lender any other document reasonably required to evidence the Lender’s interest in any part of such item of Intellectual Property Collateral.

 

SECTION 4.6. As to Letter-of-Credit Rights.

 

(a)                                 Each Grantor, by granting a security interest in its Letter-of-Credit Rights to the Lender, intends to (and hereby does) collaterally assign to the Lender its rights (including its contingent rights) to the Proceeds of all Letter-of-Credit Rights of which it is or hereafter becomes a beneficiary or assignee.

 

(b)                                 Upon the occurrence of an Event of Default, such Grantor will, promptly upon request by the Lender, (i) notify (and such Grantor hereby authorizes the Lender to notify) the issuer and each nominated person with respect to each of the Letters of Credit that the Proceeds thereof have been assigned to the Lender hereunder and any payments due or to become due in respect thereof are to be made directly to the Lender and (ii) arrange for the Lender to become the transferee beneficiary of such Letter of Credit.

 

SECTION 4.7. As to Commercial Tort Claims. Each Grantor covenants and agrees that, until the payment in full of the Obligations and termination of all Commitments, with respect to any Commercial Tort Claim hereafter arising, it shall deliver to the Lender a supplement in form and substance reasonably satisfactory to the Lender, together with all supplements to schedules thereto, identifying such new Commercial Tort Claim.

 

SECTION 4.8. Electronic Chattel Paper and Transferable Records. If any Grantor at any time holds or acquires an interest in any electronic chattel paper or any “transferable record,” as that term is defined in Section 201 of the U.S. Federal Electronic Signatures in Global and National Commerce Act, or in Section 16 of the U.S. Uniform Electronic Transactions Act as in effect in any relevant jurisdiction, with a value in excess of $100,000, such Grantor shall promptly notify the Lender thereof and, at the request of the Lender, shall take such action as the Lender may reasonably request to vest in the Lender control under Section 9-105 of the UCC of such electronic chattel paper or control under Section 201 of the Federal Electronic Signatures in Global and National Commerce Act or, as the case may be, Section 16 of the Uniform Electronic Transactions Act, as so in effect in such jurisdiction, of such transferable record. The Lender agrees with such Grantor that the Lender will arrange, pursuant to procedures satisfactory to the Lender and so long as such procedures will not result in the Lender’s loss of control, for the Grantor to make alterations to the electronic chattel paper or transferable record permitted under Section 9-105 of the UCC or, as the case may be, Section 201 of the U.S. Federal Electronic Signatures in Global and National Commerce Act or Section 16 of the U.S. Uniform Electronic Transactions Act for a party in control to allow without loss of control, unless an Event of Default has occurred and is continuing or would occur after taking into account any action by such Grantor with respect to such electronic chattel paper or transferable record.

 

SECTION 4.9. Further Assurances, etc. Each Grantor agrees that, from time to time at its own expense, it will, subject to the terms of this Agreement, promptly execute and deliver all further instruments and documents, and take all further action, that may be necessary or that the Lender may reasonably request, in order to perfect, preserve and protect any security interest

 

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granted or purported to be granted hereby or to enable the Lender to exercise and enforce its rights and remedies hereunder with respect to any Collateral. Without limiting the generality of the foregoing, such Grantor will

 

(a)                                      from time to time upon the request of the Lender, promptly deliver to the Lender such stock powers, instruments and similar documents, reasonably satisfactory in form and substance to the Lender, with respect to such Collateral as the Lender may request and will, from time to time upon the request of the Lender, after the occurrence and during the continuance of any Event of Default, promptly transfer any securities constituting Collateral into the name of any nominee designated by the Lender; if any Collateral shall be evidenced by an Instrument, negotiable Document, Promissory Note or tangible Chattel Paper, deliver and pledge to the Lender hereunder such Instrument, negotiable Document, Promissory Note or tangible Chattel Paper (other than any Instrument, negotiable Document, Promissory Note or tangible Chattel Paper in principal amount less than $10,000) duly endorsed and accompanied by duly executed instruments of transfer or assignment, all in form and substance reasonably satisfactory to the Lender;

 

(b)                                      file (and hereby authorize the Lender to file) such Filing Statements or continuation statements, or amendments thereto, and such other instruments or notices (including any assignment of claim form under or pursuant to the federal assignment of claims statute, 31 U.S.C. § 3726, any successor or amended version thereof or any regulation promulgated under or pursuant to any version thereof), as may be necessary or that the Lender may reasonably request in order to perfect and preserve the security interests and other rights granted or purported to be granted to the Lender hereby;

 

(c)                                       at all times keep pledged to the Lender pursuant hereto, on a first-priority, perfected basis, at the request of the Lender, all Investment Property constituting Collateral, all dividends and Distributions with respect thereto, and all interest and principal with respect to Promissory Notes, and all Proceeds and rights from time to time received by or distributable to such Grantor in respect of any of the foregoing Collateral;

 

(d)                                      not create any tangible Chattel Paper without placing a legend on such tangible Chattel Paper reasonably acceptable to the Lender indicating that the Lender has a security interest in such Chattel Paper;

 

(e)                                       furnish to the Lender, from time to time at the Lender’s request, statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as the Lender may reasonably request, all in reasonable detail; and

 

(f)                                        do all things reasonably requested by the Lender in accordance with this Security Agreement in order to enable the Lender to have and maintain control over the Collateral consisting of Investment Property, Deposit Accounts, Letter-of-Credit-Rights and Electronic Chattel Paper.

 

Each Grantor agrees that a carbon, photographic or other reproduction of this Security Agreement or any UCC financing statement covering the Collateral or any part thereof shall be

 

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sufficient as a UCC financing statement where permitted by law. Each Grantor hereby authorizes the Lender to file financing statements describing as the collateral covered thereby “all of the debtor’s personal property or assets” or words to that effect, notwithstanding that such wording may be broader in scope than the Collateral described in this Security Agreement.

 

ARTICLE V
 THE LENDER

 

SECTION 5.1. Lender Appointed Attorney-in-Fact. Each Grantor hereby irrevocably appoints the Lender as its attorney-in-fact, with full authority in the place and stead of such Grantor and in the name of such Grantor or otherwise, from time to time in the Lender’s discretion, following the occurrence and during the continuance of an Event of Default, to take any action and to execute any instrument which the Lender may deem necessary or advisable to accomplish the purposes of this Security Agreement, including:

 

(a)                                 to ask, demand, collect, sue for, recover, compromise, receive and give acquittance and receipts for moneys due and to become due under or in respect of any of the Collateral;

 

(b)                                 to receive, endorse, and collect any drafts or other Instruments, Documents and Chattel Paper, in connection with clause (a) above;

 

(c)                                  to file any claims or take any action or institute any proceedings which the Lender may deem necessary or desirable for the collection of any of the Collateral or otherwise to enforce the rights of the Lender with respect to any of the Collateral; and

 

(d)                                 to perform the affirmative obligations of such Grantor hereunder.

 

Each Grantor hereby acknowledges, consents and agrees that the power of attorney granted pursuant to this Section is irrevocable and coupled with an interest.

 

SECTION 5.2. Lender May Perform. If any Grantor fails to perform any agreement contained herein, upon 5 days after the earlier to occur of (i) notice thereof given to any such Grantor by the Lender or (ii) the date on which such Grantor has knowledge of such failure, the Lender may itself perform, or cause performance of, such agreement, that the Lender deems necessary for the maintenance, preservation or protection of any of the Collateral or of its security interest therein to the extent provided for herein, and the expenses of the Lender incurred in connection therewith shall be payable by such Grantor pursuant to Section 10.3 of the Credit Agreement.

 

SECTION 5.3. Lender Has No Duty. The powers conferred on the Lender hereunder are solely to protect its interest in the Collateral and shall not impose any duty on it to exercise any such powers. Except for reasonable care of any Collateral in its possession and the accounting for moneys actually received by it hereunder, the Lender shall have no duty as to any Collateral or responsibility for

 

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(a)                                      ascertaining or taking action with respect to calls, conversions, exchanges, maturities, tenders or other matters relative to any Investment Property, whether or not the Lender has or is deemed to have knowledge of such matters, or

 

(b)                                      taking any necessary steps to preserve rights against prior parties or any other rights pertaining to any Collateral.

 

SECTION 5.4. Reasonable Care. The Lender is required to exercise reasonable care in the custody and preservation of any of the Collateral in its possession; provided that the Lender shall be deemed to have exercised reasonable care in the custody and preservation of any of the Collateral, if it takes such action for that purpose as each Grantor reasonably requests in writing at times other than upon the occurrence and during the continuance of any Event of Default, but failure of the Lender to comply with any such request at any time shall not in itself be deemed a failure to exercise reasonable care.

 

SECTION 5.5. Lender as Agent for Other Secured Parties. The Lender hereby agrees to act as agent of the other parties to which any Grantor may owe any Obligations for all purposes hereunder and under the other Loan Documents pursuant to which any Grantor grants a Lien or other right in any Collateral to secure the Obligations, for purposes of acquiring, holding and enforcing any and all Liens on any Collateral granted by any Grantor to secure any of the Obligations. The Lender may appoint any co-agents, sub-agents or attorneys-in-fact in connection with the foregoing.

 

ARTICLE VI
 REMEDIES

 

SECTION 6.1. Certain Remedies. If any Event of Default shall have occurred and be continuing:

 

(a)                            The Lender may exercise in respect of the Collateral, in addition to other rights and remedies provided for herein or otherwise available to it, all the rights and remedies of the Lender on default under the UCC (whether or not the UCC applies to the affected Collateral) and also may

 

(i)                                          take possession of any Collateral not already in its possession without demand and without legal process;

 

(ii)                                       require each Grantor to, and each Grantor hereby agrees that it will, at its expense and upon request of the Lender forthwith, assemble all or part of the Collateral as directed by the Lender and make it available to the Lender at a place to be designated by the Lender that is reasonably convenient to both parties,

 

(iii)                                    enter onto the property where any Collateral is located and take possession thereof without demand and without legal process; and

 

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(iv)            without notice except as specified below, lease, license, sell or  otherwise dispose of the Collateral or any part thereof in one or more parcels at any public or private sale, at any of the Lender’s offices or elsewhere, for cash, on credit or for future delivery, and upon such other terms as the Lender may deem commercially reasonable. Each Grantor agrees that, to the extent notice of sale shall be required by law, at least ten (10) days’ prior notice to such Grantor of the time and place of any public sale or the time after which any private sale is to be made shall constitute reasonable notification. The Lender shall not be obligated to make any sale of Collateral regardless of notice of sale having been given. The Lender may adjourn any public or private sale from time to time by announcement at the time and place fixed therefor, and such sale may, without further notice, be made at the time and place to which it was so adjourned.

 

(b)           All cash Proceeds received by the Lender in respect of any sale of, collection from, or other realization upon, all or any part of the Collateral shall be applied by the Lender against all or any part of the Obligations as set forth in Section 4.4(b) of the Credit Agreement.

 

(c)           The Lender may

 

(i)            transfer all or any part of the Collateral into the name of the Lender or its nominee, with or without disclosing that such Collateral is subject to the Lien hereunder,

 

(ii)           notify the parties obligated on any of the Collateral to make payment to the Lender of any amount due or to become due thereunder,

 

(iii)          withdraw, or cause or direct the withdrawal, of all funds with respect to the Collateral Account;

 

(iv)          enforce collection of any of the Collateral by suit or otherwise, and surrender, release or exchange all or any part thereof, or compromise or extend or renew for any period (whether or not longer than the original period) any obligations of any nature of any party with respect thereto,

 

(v)           endorse any checks, drafts, or other writings in any Grantor’s name to allow collection of the Collateral,

 

(vi)          take control of any Proceeds of the Collateral, and

 

(vii)         execute (in the name, place and stead of any Grantor) endorsements, assignments, stock powers and other instruments of conveyance or transfer with respect to all or any of the Collateral.

 

SECTION 6.2. Securities Laws. If the Lender shall determine to exercise its right to sell all or any of the Collateral that are Capital Securities pursuant to Section 6.1(a)(iv), each Grantor acknowledges that the Lender may be unable to effect a public sale or other disposition of the Capital Securities by reason of certain prohibitions contained in the Securities Act of 1933, as

 

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from time to time amended (the “Securities Act”), federal banking laws, and other applicable laws, but may be compelled to resort to one or more private sales thereof to a restricted group of purchasers. Each Grantor agrees that any such private sale may be at prices and other terms less favorable to the seller than if sold at public sales and that such private sales shall not solely by reason thereof be deemed not to have been made in a commercially reasonable manner. The Lender shall be under no obligation to delay a sale of any of the Capital Securities for the period of time necessary to permit the issuer of such securities to register such securities for public sale under the Securities Act, or such other federal banking or other applicable laws, even if the issuer would agree to do so. Subject to the foregoing, the Lender agrees that any sale of the Capital Securities shall be made in a commercially reasonable manner, and each Grantor agrees to use its reasonable best efforts to cause the issuer or issuers of the Capital Securities contemplated to be sold, to execute and deliver, all at the Grantors’ expense, all such instruments and documents, and to do or cause to be done all such other acts and things as may be necessary or, in the reasonable opinion of the Lender, advisable to exempt such Capital Securities from registration under the provisions of the Securities Act, and to make all amendments to such instruments and documents which, in the opinion of the Lender, are necessary or advisable, all in conformity with the requirements of the Securities Act and the rules and regulations of the Securities and Exchange Commission applicable thereto. Each Grantor further agrees to use its reasonable best efforts (a) to cause such issuer or issuers to exempt or comply with the provisions of the securities or “Blue Sky” laws of any jurisdiction which the Lender designates and obtain all necessary governmental approvals for the sale of the Capital Securities, as requested by the Lender; (b) if required, to cause such issuer or issuers to make available to its security holders, as soon as practicable, an earnings statement (which need not be audited) which will satisfy the provisions of Section 11(a) of the Securities Act; and (c) to do or cause to be done all such other acts and things as may be necessary to make such sale of the Collateral or any part thereof valid and binding and in compliance with applicable law.

 

SECTION 6.3. Compliance with Restrictions. Each Grantor agrees that in any sale of any of the Collateral whenever an Event of Default shall have occurred and be continuing, the Lender is hereby authorized to comply with any limitation or restriction in connection with such sale as it may be advised by counsel is necessary in order to avoid any violation of applicable law (including compliance with such procedures as may restrict the number of prospective bidders and purchasers, require that such prospective bidders and purchasers have certain qualifications, and restrict such prospective bidders and purchasers to Persons who will represent and agree that they are purchasing for their own account for investment and not with a view to the distribution or resale of such Collateral), or in order to obtain any required approval of the sale or of the purchaser by any Governmental Authority or official, and such Grantor further agrees that such compliance shall not result in such sale being considered or deemed not to have been made in a commercially reasonable manner, nor shall the Lender be liable nor accountable to such Grantor for any discount allowed by the reason of the fact that such Collateral is sold in compliance with any such limitation or restriction.

 

SECTION 6.4. Protection of Collateral. The Lender may from time to time, at its option, perform any act which any Grantor fails to perform after being requested in writing so to perform (it being understood that no such request need be given after the occurrence and during the continuance of an Event of Default) and the Lender may from time to time take any other action

 

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which the Lender deems necessary for the maintenance, preservation or protection of any of the Collateral or of its security interest therein.

 

ARTICLE VII
 MISCELLANEOUS PROVISIONS

 

SECTION 7.1. Loan Document. This Security Agreement is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed, administered and applied in accordance with the terms and provisions thereof, including Article X thereof. Notwithstanding anything contained herein to contrary, to the extent any provision in this Security Agreement conflicts with any provision in the Credit Agreement, the terms of the Credit Agreement shall control.

 

SECTION 7.2. Binding on Successors, Transferees and Assigns; Assignment. This Security Agreement shall remain in full force and effect until the Termination Date has occurred, shall be binding upon the Grantors and their successors, transferees and assigns and shall inure to the benefit of and be enforceable by the Lender; provided that no Grantor may assign any of its obligations hereunder without the prior consent of the Lender.

 

SECTION 7.3. Amendments, etc. No amendment or modification to or waiver of any provision of this Security Agreement, nor consent to any departure by any Grantor from its obligations under this Security Agreement, shall in any event be effective unless the same shall be in writing and signed by the Lender and the Grantors and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

 

SECTION 7.4. Notices. All notices and other communications provided for hereunder shall be delivered or made as provided in Section 10.2 of the Credit Agreement.

 

SECTION 7.5. Release of Liens. Upon (a) the Disposition of Collateral in accordance with the Credit Agreement and this Security Agreement or (b) the occurrence of the Termination Date, the security interests granted herein shall automatically terminate with respect to (i) such Collateral (in the case of clause (a)) or (ii) all Collateral (in the case of clause (b)). Upon any such Disposition or termination, the Lender will, at the Grantors’ sole expense, deliver to the Grantors, without any representations, warranties or recourse of any kind whatsoever, all Collateral held by the Lender hereunder, and execute and deliver to the Grantors such documents as the Grantors shall reasonably request to evidence such termination.

 

SECTION 7.6. Additional Grantors. Upon the execution and delivery by any other Person of a supplement in the form of Annex I hereto, such Person shall become a “Grantor” hereunder as of the date of such supplement with the same force and effect as if it were originally a party to this Security Agreement and named as a “Grantor” hereunder. The execution and delivery of such supplement shall not require the consent of any other Grantor hereunder, and the rights and obligations of each Grantor hereunder shall remain in full force and effect notwithstanding the addition of any new Grantor as a party to this Security Agreement.

 

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SECTION 7.7. No Waiver; Remedies. In addition to, and not in limitation of  Section 2.4, no failure on the part of the Lender to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.

 

SECTION 7.8. Severability. Any provision of this Security Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such provision and such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Security Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

 

SECTION 7.9. Governing Law, Entire Agreement, etc. THIS SECURITY AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS SECURITY AGREEMENT OR ANY OTHER LOAN DOCUMENT CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). This Security Agreement, along with the other Loan Documents, constitutes the entire understanding among the parties hereto with respect to the subject matter thereof and supersedes any prior agreements, written or oral, with respect thereto

 

SECTION 7.10. Counterparts. This Security Agreement may be executed by the parties hereto in several counterparts, each of which shall be an original and all of which shall constitute together but one and the same agreement. This Security Agreement shall become effective when counterparts hereof executed on behalf of all of the signatories hereto, shall have been received  by the Lender. Delivery of an executed counterpart of a signature page to this Security Agreement by email (e.g. “pdf” or “tiff”) or telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

 

[Signature Page Follows]

 

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IN WITNESS WHEREOF, each of the parties hereto has caused this Security Agreement to be duly executed and delivered by its Authorized Officer as of the date first above written.

 

 

	
 
    	
NATERA, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Matthew Rabinowitz
    
	
 
    	
 
    	
Name: Matthew Rabinowitz
    
	
 
    	
 
    	
Title: Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
NATERA INTERNATIONAL, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Matthew Rabinowitz
    
	
 
    	
 
    	
Name: Matthew Rabinowitz
    
	
 
    	
 
    	
Title: Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ROS ACQUISITION OFFSHORE LP,

as the Lender, for itself and as agent
    
	
 
    	
By ROS Acquisition Offshore GP Ltd.,

its General Partner
    
	
 
    	
By OrbiMed Advisors LLC,
    
	
 
    	
its investment manager
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Samuel D. Isaly
    
	
 
    	
 
    	
Name: Samuel D. Isaly
    
	
 
    	
 
    	
Title: Managing Member
    

 

Signature Page to Security Agreement

 

 

 

SCHEDULE I
 to Security Agreement

 

	
Name of Grantor:
    	
 
    	
Interest:
    
	
Natera, Inc.
    	
 
    	
All common stock issued   and outstanding of Natera International, Inc. owned by Natera, Inc.
    

 

 

SCHEDULE II 
 to Security Agreement

 

Item A.  Location of each Grantor.

 

	
Name of Grantor:
    	
 
    	
Location for purposes of UCC:
    
	
Natera, Inc.
    	
 
    	
Delaware
    
	
Natera International, Inc.
    	
 
    	
Delaware
    

 

Item B.  Filing locations last five years.

 

Delaware

 

Item C.  Trade names.

 

	
Name of Grantor:
    	
 
    	
Trade Names:
    
	
Natera, Inc.
    	
 
    	
Natera
    
	
Natera International, Inc.
    	
 
    	
Natera, Natera International
    

 

Item D.  Merger or other corporate reorganization.

 

None.

 

Item E.  Grantor’s federal taxpayer ID numbers.

 

	
Name of Grantor:
    	
 
    	
Taxpayer ID numbers:
    
	
Natera, Inc.
    	
 
    	
01-0894487
    
	
Natera International, Inc.
    	
 
    	
45-4907137
    

 

Item F.  Government Contracts.

 

None.

 

Item G.  Deposit Accounts, Securities Accounts and Commodities Accounts.

 

	
Name of Grantor:
    	
Description of Deposit Accounts, Securities   Accounts and Commodities Accounts:
    

 

 

	
Natera, Inc.
    	
Comerica Bank   (ABA 121137522)

c/o Angela Ong,

333 W. Santa Clara   Street

San Jose, CA  95113

 

650-462-6036

 

Subject to Account Control   Agreement

Operating: [*]

Money Market:  [*]

ZBA Insurance: [*]    (linked to a Lockbox [*])  (ZBA sweep to Operating [*])

International Ops: [*]

 

Not Subject to Account Control   Agreement

Payroll:  [*]

Government Insurance:   [*] (Linked to a Lockbox [*])

 

Not Subject to Account Control   Agreement; Subject to separate perfected Lien interests

Credit Card   Receivables: [*]   Value $150,000.00

Lease Letter of Credit   (Nektar):  [*]  Value $745,254.60

 

Silicon Valley Bank   (ABA 121140399)

c/o Account Services

3003 Tasman Drive

Santa Clara, CA 95054

 

888-572-7823

 

Subject to Account Control   Agreement

None

 

Not Subject to Account Control   Agreement; Subject to separate perfected Lien interests

Lease Letter of Credit   (Redwood Junction):  [*]  Value $15,000.00

 
    
	
Natera International, Inc.
    	
None.
    

 

[*] 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 PORTION.

 

 

Item H.  Letter of Credit Rights.

 

None.

 

Item I.  Commercial Tort Claims.

 

None

 

Item J.  Pledged Notes.

 

	
Name of Grantor:
    	
 
    	
Description of Pledged Notes:
    
	
Natera, Inc
    	
 
    	
None.
    
	
Natera International, Inc.
    	
 
    	
None.
    

 

 

SCHEDULE III

to Security Agreement

 

Item A.  Patents

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
System and Method for   Improving Clinical Decisions by Aggregating, Validating and Analysing Genetic   and Phenotypic Data
    	
 
    	
US2006/0052945
    	
 
    	
11/004,274
    	
 
    	
12/3/2004
    	
 
    	
US
    	
 
    	
Issued
    	
 
    	
8,024,128
    	
 
    	
9/20/2011
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for Using   Genetic, Phenotypic and Clinical Data to Make Predictions for Clinical or   Lifestyle Decisions
    	
 
    	
US2007/0027636
    	
 
    	
11/496,982
    	
 
    	
7/31/2006
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data from Target Individuals Using Genetic Data from   Genetically Related Individuals
    	
 
    	
US2007/0184467
    	
 
    	
11/603,406
    	
 
    	
11/22/2006
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data from Target Individuals Using Genetic Data from   Genetically Related Individuals
    	
 
    	
 
    	
 
    	
13/793,133
    	
 
    	
3/11/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data from Target Individuals Using Genetic Data from   Genetically Related Individuals
    	
 
    	
 
    	
 
    	
13/793,186
    	
 
    	
3/11/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
WO2007/062164
    	
 
    	
PCT/US06/045281
    	
 
    	
11/22/2006
    	
 
    	
PCT
    	
 
    	
National Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
EP1960929
    	
 
    	
06838311.6
    	
 
    	
11/22/2006
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
EP 2437191
    	
 
    	
11175867.8
    	
 
    	
11/22/2006
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
AU2006318425
    	
 
    	
2006318425
    	
 
    	
11/22/2006
    	
 
    	
AU
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
CA2632230
    	
 
    	
2632230
    	
 
    	
11/22/2006
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
CN101309703
    	
 
    	
200680049316.3
    	
 
    	
11/22/2006
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
HK1125195
    	
 
    	
9102141.5
    	
 
    	
3/5/2009
    	
 
    	
HK
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Using Data to Make Predictions
    	
 
    	
JP2009517050
    	
 
    	
2008-542450
    	
 
    	
11/22/2006
    	
 
    	
JP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Integrating and Validating Genotypic, Phenotypic and Medical Information into   a Database According to a Standardized Ontology
    	
 
    	
US2007/0178501
    	
 
    	
11/634,550
    	
 
    	
12/6/2006
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Determining Chromosome Copy Number
    	
 
    	
US2008/0243398
    	
 
    	
12/076,348
    	
 
    	
3/17/2008
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Determining Chromosome Copy Number
    	
 
    	
WO2008/115497
    	
 
    	
PCT/US08/03547
    	
 
    	
3/17/2008
    	
 
    	
PCT
    	
 
    	
National Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
System and Method for   Cleaning Noisy Genetic Data and Determining Chromosome Copy Number
    	
 
    	
EP2140386
    	
 
    	
08742125.1
    	
 
    	
3/17/2008
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
System and Method for   Cleaning Noisy Genetic Data and Determining Chromosome Copy Number
    	
 
    	
CN101790731
    	
 
    	
200880016123.7
    	
 
    	
3/17/2008
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Cell Genotyping
    	
 
    	
US2011/0033862
    	
 
    	
12/918,445
    	
 
    	
10/7/2010
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Cell Genotyping
    	
 
    	
WO2009/105531
    	
 
    	
PCT/US09/34506
    	
 
    	
2/19/2009
    	
 
    	
PCT
    	
 
    	
National Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Embryo   Characterization and Comparison
    	
 
    	
US2011/0092763
    	
 
    	
12/994,260
    	
 
    	
12/20/2010
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Embryo   Characterization and Comparison
    	
 
    	
WO2009/146335
    	
 
    	
PCT/US09/45335
    	
 
    	
5/27/2009
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
US2011/0178719
    	
 
    	
13/057,350
    	
 
    	
3/29/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
 
    	
 
    	
13/846,111
    	
 
    	
3/18/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
WO2010/017214
    	
 
    	
PCT/US09/52730
    	
 
    	
8/4/2009
    	
 
    	
PCT
    	
 
    	
National Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
EP2321642
    	
 
    	
9805452.1
    	
 
    	
8/4/2009
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
AU2009279734
    	
 
    	
2009279734
    	
 
    	
8/4/2009
    	
 
    	
AU
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
CA2731991
    	
 
    	
2731991
    	
 
    	
8/4/2009
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
CN102171565
    	
 
    	
200980139431.1
    	
 
    	
8/4/2009
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Allele Calling   and Ploidy Calling
    	
 
    	
HK1159248
    	
 
    	
11113782.2
    	
 
    	
12/21/2011
    	
 
    	
HK
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
US2012/0185176
    	
 
    	
13/499,086
    	
 
    	
3/29/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
WO2011/041485
    	
 
    	
PCT/US2010/050824
    	
 
    	
9/30/2010
    	
 
    	
PCT
    	
 
    	
National Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
EP2473638
    	
 
    	
10821214.3
    	
 
    	
9/30/2010
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
CA2774252
    	
 
    	
2774252
    	
 
    	
9/30/2010
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
CN10257266
    	
 
    	
201080048121.3
    	
 
    	
9/30/2010
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
 
    	
 
    	
13100216.3
    	
 
    	
1/7/2013
    	
 
    	
HK
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
US2011/0288780
    	
 
    	
13/110,685
    	
 
    	
5/18/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
WO2011/146632
    	
 
    	
PCT/US2011/037018
    	
 
    	
5/18/2011
    	
 
    	
PCT
    	
 
    	
National Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
EP2572003
    	
 
    	
11784180.9
    	
 
    	
5/18/2011
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
AU2011255641
    	
 
    	
2011255641
    	
 
    	
5/18/2011
    	
 
    	
AU
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
CA2798758
    	
 
    	
2798758
    	
 
    	
5/18/2011
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
US2012/0270212
    	
 
    	
13/300,235
    	
 
    	
11/18/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
 
    	
 
    	
13/791,397
    	
 
    	
3/8/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
WO2012/108920
    	
 
    	
PCT/US11/61506
    	
 
    	
11/18/2011
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
Methods for Non-invasive   Prenatal Paternity Testing
    	
 
    	
US2012/0122701
    	
 
    	
13/335,043
    	
 
    	
12/22/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Paternity Testing
    	
 
    	
 
    	
 
    	
13/846,160
    	
 
    	
3/18/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Paternity Testing
    	
 
    	
WO2012/088456
    	
 
    	
PCT/US11/66938
    	
 
    	
12/22/2011
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Preimplantation   Genetic Diagnosis by Sequencing
    	
 
    	
 
    	
 
    	
PCT/US12/058578
    	
 
    	
10/3/2012
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Highly Multiplex PCR   Methods and Compositions
    	
 
    	
 
    	
 
    	
13/683,604
    	
 
    	
11/21/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Highly Multiplex PCR   Methods and Compositions
    	
 
    	
 
    	
 
    	
PCT/US12/66339
    	
 
    	
11/21/2012
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Highly Multiplex PCR   Methods and Compositions
    	
 
    	
 
    	
 
    	
61/767,865
    	
 
    	
2/22/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Informatics Enhanced Analysis   of Fetal Samples Subject to Maternal Contamination
    	
 
    	
 
    	
 
    	
13/780,022
    	
 
    	
2/28/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Informatics Enhanced Analysis   of Fetal Samples Subject to Maternal Contamination
    	
 
    	
 
    	
 
    	
PCT/US2013/28378
    	
 
    	
2/28/2013
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Increasing   Fetal Fraction in Maternal Blood
    	
 
    	
 
    	
 
    	
13/793,316
    	
 
    	
3/11/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Increasing   Fetal Fraction in Maternal Blood
    	
 
    	
 
    	
 
    	
61/743,423
    	
 
    	
9/4/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Improved Methods and   Reagents for Quantification of Amplification Products
    	
 
    	
 
    	
 
    	
61/675,020
    	
 
    	
7/24/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-Invasive   Prenatal Testing Using Parental Mosaicism Data
    	
 
    	
 
    	
 
    	
61/684,243
    	
 
    	
8/17/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-Invasive   Prenatal Testing Using Parental Mosaicism Data
    	
 
    	
 
    	
 
    	
61/790,108
    	
 
    	
3/15/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
Methods and Compositions   for Reducing Genetic Library Contamination
    	
 
    	
 
    	
 
    	
61/683,331
    	
 
    	
8/15/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods and Compositions   for Reducing Genetic Library Contamination
    	
 
    	
 
    	
 
    	
61/790,222
    	
 
    	
3/15/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    

 

Item B.  Patent Licenses

 

None.

 

 

SCHEDULE IV 
 to Security Agreement

 

Item A.  Trademarks

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
PRENATUS
    	
 
    	
85/467718
    	
 
    	
 
    	
 
    	
Allowed
    	
 
    	
US
    	
 
    	
11/8/2011
    	
 
    	
 
    	
 
    	
42 Int. medical laboratory   services; genetic testing for scientific research purposes in the field of   human reproduction
    
   44 Int. genetic testing for medical purposes and genetic counseling in the   field of human reproduction
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
85/487673
    	
 
    	
4203883
    	
 
    	
Registered
    	
 
    	
US
    	
 
    	
12/5/2011
    	
 
    	
09/04/12
    	
 
    	
42 Int. medical and   scientific research and analysis in the field of genetic testing; providing   medical and scientific research information in the field of genetic testing;   medical laboratory services; genetic testing for scientific research and analysis   purposes; genetic testing for scientific research and analysis purposes in   the field of human reproduction; providing a website featuring information in   the field of genetic testing for scientific purposes
    
   44 Int. genetic testing for medical purposes; genetic counseling; genetic   testing for medical purposes and genetic counseling in the field of human   reproduction; providing a website featuring information about genetic testing   for medical purposes and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
10930469
    	
 
    	
10930469
    	
 
    	
Registered
    	
 
    	
EP
    	
 
    	
6/1/2012
    	
 
    	
10/30/12
    	
 
    	
42 Int. medical and   scientific research in the field of genetic testing; providing medical and   scientific research information in the field of genetic testing; medical and   scientific research and analysis in the field of genetic testing; medical laboratory   services; genetic testing or scientific research and analysis purposes;   genetic testing for scientific research and analysis purposes in the field of   human reproduction; providing a website featuring information in the field of   genetic testing medical purposes; medical laboratory services

 

44 Int. genetic testing;   genetic counseling; genetic testing and genetic counseling in the field of   human reproduction; providing a website featuring information about genetic   testing and genetic counseling; genetic testing for medical purposes; genetic   testing for medical purposes and genetic counseling in the field of human   reproduction; providing a website featuring information about genetic testing   for medical purposes and genetic counselingcounseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
1580172
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
CA
    	
 
    	
6/1/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and   scientific research in the field of genetic testing; providing medical and   scientific research information in the field of genetic testing

 

44 Int. medical laboratory   services; genetic testing; genetic counseling; genetic testing and genetic   counseling in the field of human reproduction; providing a website featuring   information about genetic testing and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
NATERA
    	
 
    	
11022636
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
CN
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and   scientific research in the field of genetic testing; providing medical and   scientific research information in the field of genetic testing
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
NATERA
    	
 
    	
11022635
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
CN
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
44 Int. medical laboratory   services; genetic testing; genetic counseling; genetic testing and genetic   counseling in the field of human reproduction; providing a website featuring   information about genetic testing and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
2012-44502
    	
 
    	
5521348
    	
 
    	
Registered
    	
 
    	
JP
    	
 
    	
6/4/2012
    	
 
    	
09/14/12
    	
 
    	
42 Int. medical and   scientific research and analysis in the field of genetic testing, providing   medical and scientific research information in the field of genetic testing,   testing; inspection or research on therapeutic approaches and techniques   related to medical treatment and providing information thereof, genetic   testing for scientific research and analysis purposes, genetic testing for   scientific research and analysis purposes in the field of human reproduction,   hosting computer sites (web sites) featuring information in the field of   genetic testing for medical purposes, research and development for others,   providing information in the field of medical research, testing; inspection   or research for medical care, computer software design, testing; inspection   or research for medical care, computer software design; computer programming   or maintenance of computer of computer software with respect to medical data,   design of surgical instruments, analysis; research in the field of medical   care and consultation thereof, testing or research on machines; apparatus and   instruments and their parts for medical purposes

 

44 Int. genetic testing for   medical purposes, counseling for medical purposes in the field of genetic,   genetic testing for medical purpose and counseling as medical purposes   related to inheritance in the field of human reproduction, providing   information on gene therapy, medical services; providing medical information,   counseling and advice on health care, counseling and advice on providing of   medical information
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
1494690
    	
 
    	
 
    	
 
    	
Published
    	
 
    	
AU
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and scientific   research in the field of genetic testing; providing medical and scientific   research information in the field of genetic testing

 

44 Int. medical laboratory   services; genetic testing; genetic counseling; genetic testing and genetic   counseling in the field of human reproduction; providing a website featuring   information about genetic testing and genetic counseling, namely providing   information about genetic testing and genetic counseling via a website
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
2012718511
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
RU (Russian Federation)
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and   scientific research and analysis in the field of genetic testing; providing   medical and scientific research information in the field of genetic testing;   medical laboratory services; genetic testing for scientific research and   analysis purposes; genetic testing for scientific research and analysis purposes   in the field of human reproduction; providing a website featuring information   in the field of genetic testing for medical purposes

 

44 Int. genetic testing for   medical purposes; genetic counseling; genetic testing for medical purposes   and genetic counseling in the field of human reproduction; providing a   website featuring information about genetic testing for medical purposes and   genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
840152647
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
BR (Brazil)
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and   scientific research and analysis in the field of genetic testing; providing   medical and scientific research information in the field of genetic testing;   medical laboratory services; genetic testing for scientific research and   analysis purposes; genetic testing for scientific research and analysis   purposes in the field of human reproduction; providing a website featuring   information in the field of genetic testing for medical purposes
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
NATERA
    	
 
    	
840152671
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
BR
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
44 Int. genetic testing for   medical purposes; genetic counseling; genetic testing for medical purposes   and genetic counseling in the field of human reproduction; providing a   website featuring information about genetic testing for medical purposes and   genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
NATERA
    	
 
    	
2343007
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
IN (India)
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and   scientific research and analysis in the field of genetic testing; providing   medical and scientific research information in the field of genetic testing;   medical laboratory services; genetic testing for scientific research and   analysis purposes; genetic testing for scientific research and analysis   purposes in the field of human reproduction; providing a website featuring   information in the field of genetic testing for medical purposes

 

44 Int. genetic testing for   medical purposes; genetic counseling; genetic testing for medical purposes   and genetic counseling in the field of human reproduction; providing a   website featuring information about genetic testing for medical purposes and   genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of

Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest
   Information
    
	
PANORAMA
    	
 
    	
85/776044
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
US (foreign filing options   are open)
    	
 
    	
11/9/2012
    	
 
    	
 
    	
 
    	
01 Int. kits and reagents   for genetic testing for medical and scientific research purposes; kits and   reagents for genetic testing for medical and scientific research purposes in   the field of human reproduction; kits and reagents for prenatal testing for   medical and scientific research purposes; nucleic acid based kits and   reagents for testing for fetal chromosomal abnormalities for medical and   scientific research purposes
    
   42 Int. genetic testing for scientific research purposes; genetic testing for   scientific research purposes in the field of human reproduction; prenatal   testing for scientific research purposes; testing for fetal chromosomal   abnormalities for research purposes; scientific, laboratory, clinical,   medical, and technological research and analysis services in the fields of   nucleic acid analysis, prenatal testing, and genetics; medical laboratory   services; providing a website featuring information about genetic testing for   scientific research purposes; providing a website featuring information about   prenatal testing for scientific research purposes
    
   44 Int. genetic testing for medical purposes; genetic testing for medical   purposes in the field of human reproduction; prenatal testing for medical   purposes; testing for fetal chromosomal abnormalities for medical purposes;   genetic counseling; providing a website featuring information about genetic   testing and genetic counseling for medical purposes; providing a website   featuring information about prenatal testing and genetic counseling for   medical purposes
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

Item B.  Trademark Licenses

 

None.

 

 

SCHEDULE V

to Security Agreement

 

Item A.  Copyrights/Mask Works

 

None.

 

Item B.  Copyright/Mask Work Licenses

 

None.

 

 

SCHEDULE VI

to Security Agreement

 

None.

 

 

EXHIBIT A

to Security Agreement

Execution Version

 

PATENT SECURITY AGREEMENT

 

This PATENT SECURITY AGREEMENT, dated as of April 18, 2013 (this “Agreement”), is made by NATERA, INC., a Delaware corporation (the “Grantor”), in favor of ROS ACQUISITION OFFSHORE LP, a Cayman Islands Exempted Limited Partnership (together with its Affiliates, successors, transferees and assignees, the “Lender”).

 

W I T N E S S E T H:

 

WHEREAS, pursuant to a Credit Agreement, dated as of April 18, 2013 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), by and between Natera, Inc., a Delaware corporation (the “Borrower”) and the Lender, the Lender has extended a Commitment to make the Loans to the Borrower;

 

WHEREAS, in connection with the Credit Agreement, the Grantor and its Affiliates have executed and delivered a Pledge and Security Agreement in favor of the Lender, dated as of April 18, 2013 (as amended, supplemented or otherwise modified from time to time, the “Security Agreement”);

 

WHEREAS, pursuant to the Credit Agreement and pursuant to clause (e) of Section 4.5 of the Security Agreement, the Grantor is required to execute and deliver this Agreement and to grant to the Lender a continuing security interest in all of the Patent Collateral (as defined below) to secure all of the Obligations; and

 

WHEREAS, the Grantor has duly authorized the execution, delivery and performance of this Agreement;

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Grantor agrees, for the benefit of the Lender, as follows:

 

SECTION 1. Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Agreement, including its preamble and recitals, have the meanings provided (or incorporated by reference) in the Security Agreement.

 

SECTION 2. Grant of Security Interest. The Grantor hereby grants to the Lender, for its benefit, a continuing security interest in all of the Grantor’s right, title and interest in and to the following property, whether now or hereafter existing or acquired by the Grantor (the “Patent Collateral”):

 

(a)           all of its letters patent and applications for letters patent throughout the world, including each patent and patent application referred to in Item A of Schedule I attached hereto;

 

(b)           all reissues, divisions, continuations, continuations-in-part, extensions, renewals and reexaminations of any of the items described in clause (a);

 

 

(c)           all patent licenses and other agreements providing the Grantor with the right to use any items of the type referred to in clauses (a) and (b) above, including each patent license referred to in Item B of Schedule I attached hereto; and

 

(d)           all Proceeds of, and rights associated with, the foregoing (including licenses, royalties income, payments, claims, damages and Proceeds of infringement suits) and the right to sue third parties for past, present or future infringements of any patent or patent application and for breach or enforcement of any patent license.

 

SECTION 3. Security Agreement. This Agreement has been executed and delivered by the Grantor for the purpose of registering the security interest of the Lender in the Patent Collateral with the United States Patent and Trademark Office. The security interest granted hereby has been granted in furtherance of, and not in limitation of, the security interest granted to the Lender for its benefit under the Security Agreement. The Security Agreement (and all rights and remedies of the Lender thereunder) shall remain in full force and effect in accordance with its terms.

 

SECTION 4. Release of Liens. Upon (i) the Disposition of Patent Collateral in accordance with the Credit Agreement or (ii) the occurrence of the Termination Date, the security interests granted herein shall automatically terminate with respect to (A) such Patent Collateral (in the case of clause (i)) or (B) all Patent Collateral (in the case of clause (ii)). Upon any such Disposition or termination, the Lender will, at the Grantor’s sole expense, deliver to the Grantor, without any representations, warranties or recourse of any kind whatsoever, all Patent Collateral held by the Lender hereunder, and execute and deliver to the Grantor such documents as the Grantor shall reasonably request to evidence such termination.

 

SECTION 5. Acknowledgment. The Grantor does hereby further acknowledge and affirm that the rights and remedies of the Lender with respect to the security interest in the Patent Collateral granted hereby are more fully set forth in the Security Agreement, the terms and provisions of which (including the remedies provided for therein) are incorporated by reference herein as if fully set forth herein.

 

SECTION 6. Loan Document. This Agreement is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed, administered and applied in accordance with the terms and provisions thereof, including Article X thereof.

 

SECTION 7. Effective. This Agreement shall become effective when a counterpart hereof executed by the Grantor, shall have been received by the Lender. Delivery of an executed counterpart of a signature page to this Agreement by email (e.g. “pdf” or “tiff”) or telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

 

[Signature Page Follows]

 

2

 

IN WITNESS WHEREOF, the Grantor hereto has caused this Agreement to be duly executed and delivered by its Authorized Officer as of the date first above written.

 

 

	
 
    	
NATERA, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By: 
    	
/s/ Matthew Rabinowitz
    
	
 
    	
 
    	
Name: 
    	
Matthew Rabinowitz
    
	
 
    	
 
    	
Title: 
    	
Chief Executive Officer
    

 

[ Signature Page to Patent Security Agreement ]

 

 

SCHEDULE I

to Patent Security Agreement

 

Item A

 

See attached.

 

Item B

 

None.

 

[ Schedules to Patent Security Agreement ]

 

 

PATENTS

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
    Date
    	
 
    	
Expiration 
    Date
    	
 
    	
Assignee
    
	
System and Method for   Improving Clinical
    	
 
    	
US2006/0052945
    	
 
    	
11/004,274
    	
 
    	
12/3/2004
    	
 
    	
US
    	
 
    	
Issued
    	
 
    	
8,024,128
    	
 
    	
9/20/2011
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Decisions by   Aggregating, Validating and
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Analysing Genetic and   Phenotypic Data
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Using Genetic,
    	
 
    	
US2007/0027636
    	
 
    	
11/496,982
    	
 
    	
7/31/2006
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Phenotypic and Clinical   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions for   Clinical or Lifestyle Decisions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
US2007/0184467
    	
 
    	
11/603,406
    	
 
    	
11/22/2006
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data from   Target Individuals Using
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Genetic Data from   Genetically Related
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Individuals
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
 
    	
 
    	
13/793,133
    	
 
    	
3/11/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data from   Target Individuals Using
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Genetic Data from   Genetically Related
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Individuals
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
 
    	
 
    	
13/793,186
    	
 
    	
3/11/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data from   Target Individuals Using
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Genetic Data from   Genetically Related
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Individuals
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
WO2007/062164
    	
 
    	
PCT/US06/045281
    	
 
    	
11/22/2006
    	
 
    	
PCT
    	
 
    	
National
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Stage
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
EP1960929
    	
 
    	
06838311.6
    	
 
    	
11/22/2006
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
EP 2437191
    	
 
    	
11175867.8
    	
 
    	
11/22/2006
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
AU2006318425
    	
 
    	
2006318425
    	
 
    	
11/22/2006
    	
 
    	
AU
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
CA2632230
    	
 
    	
2632230
    	
 
    	
11/22/2006
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
CN101309703
    	
 
    	
200680049316.3
    	
 
    	
11/22/2006
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
HK1125195
    	
 
    	
9102141.5
    	
 
    	
3/5/2009
    	
 
    	
HK
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Cleaning Noisy
    	
 
    	
JP2009517050
    	
 
    	
2008-542450
    	
 
    	
11/22/2006
    	
 
    	
JP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Genetic Data and Using   Data to Make
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Predictions
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
System and Method for   Integrating and
    	
 
    	
US2007/0178501
    	
 
    	
11/634,550
    	
 
    	
12/6/2006
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Validating Genotypic,   Phenotypic and Medical
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Information into a   Database According to a
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Standardized Ontology
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
System   and Method for Cleaning Noisy Genetic Data and Determining Chromosome Copy   Number
    	
 
    	
US2008/0243398
    	
 
    	
12/076,348
    	
 
    	
3/17/2008
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
System   and Method for Cleaning Noisy Genetic Data and Determining Chromosome Copy   Number
    	
 
    	
WO2008/115497
    	
 
    	
PCT/US08/03547
    	
 
    	
3/17/2008
    	
 
    	
PCT
    	
 
    	
National   Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
System   and Method for Cleaning Noisy Genetic Data and Determining Chromosome Copy   Number
    	
 
    	
EP2140386
    	
 
    	
08742125.1
    	
 
    	
3/17/2008
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
System   and Method for Cleaning Noisy Genetic Data and Determining Chromosome Copy   Number
    	
 
    	
CN101790731
    	
 
    	
200880016123.7
    	
 
    	
3/17/2008
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Cell Genotyping
    	
 
    	
US2011/0033862
    	
 
    	
12/918,445
    	
 
    	
10/7/2010
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Cell Genotyping
    	
 
    	
WO2009/105531
    	
 
    	
PCT/US09/34506
    	
 
    	
2/19/2009
    	
 
    	
PCT
    	
 
    	
National   Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Embryo Characterization and Comparison
    	
 
    	
US2011/0092763
    	
 
    	
12/994,260
    	
 
    	
12/20/2010
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Embryo Characterization and Comparison
    	
 
    	
WO2009/146335
    	
 
    	
PCT/US09/45335
    	
 
    	
5/27/2009
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
US2011/0178719
    	
 
    	
13/057,350
    	
 
    	
3/29/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
 
    	
 
    	
13/846,111
    	
 
    	
3/18/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
WO2010/017214
    	
 
    	
PCT/US09/52730
    	
 
    	
8/4/2009
    	
 
    	
PCT
    	
 
    	
National   Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
EP2321642
    	
 
    	
9805452.1
    	
 
    	
8/4/2009
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
AU2009279734
    	
 
    	
2009279734
    	
 
    	
8/4/2009
    	
 
    	
AU
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
CA2731991
    	
 
    	
2731991
    	
 
    	
8/4/2009
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
CN102171565
    	
 
    	
200980139431.1
    	
 
    	
8/4/2009
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Allele Calling and Ploidy Calling
    	
 
    	
HK1159248
    	
 
    	
11113782.2
    	
 
    	
12/21/2011
    	
 
    	
HK
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Non-invasive Prenatal Ploidy Calling
    	
 
    	
US2012/0185176
    	
 
    	
13/499,086
    	
 
    	
3/29/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Non-invasive Prenatal Ploidy Calling
    	
 
    	
WO2011/041485
    	
 
    	
PCT/US2010/050824
    	
 
    	
9/30/2010
    	
 
    	
PCT
    	
 
    	
National   Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue 
   Date
    	
 
    	
Expiration 
   Date
    	
 
    	
Assignee
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
EP2473638
    	
 
    	
10821214.3
    	
 
    	
9/30/2010
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
CA2774252
    	
 
    	
2774252
    	
 
    	
9/30/2010
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
CN10257266
    	
 
    	
201080048121.3
    	
 
    	
9/30/2010
    	
 
    	
CN
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
 
    	
 
    	
13100216.3
    	
 
    	
1/7/2013
    	
 
    	
HK
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
US2011/0288780
    	
 
    	
13/110,685
    	
 
    	
5/18/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
WO2011/146632
    	
 
    	
PCT/US2011/037018
    	
 
    	
5/18/2011
    	
 
    	
PCT
    	
 
    	
National Stage Entered
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
EP2572003
    	
 
    	
11784180.9
    	
 
    	
5/18/2011
    	
 
    	
EP
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
AU2011255641
    	
 
    	
2011255641
    	
 
    	
5/18/2011
    	
 
    	
AU
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
CA2798758
    	
 
    	
2798758
    	
 
    	
5/18/2011
    	
 
    	
CA
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
US2012/0270212
    	
 
    	
13/300,235
    	
 
    	
11/18/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
 
    	
 
    	
13/791,397
    	
 
    	
3/8/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Ploidy Calling
    	
 
    	
WO2012/108920
    	
 
    	
PCT/US11/61506
    	
 
    	
11/18/2011
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Paternity Testing
    	
 
    	
US2012/0122701
    	
 
    	
13/335,043
    	
 
    	
12/22/2011
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Paternity Testing
    	
 
    	
 
    	
 
    	
13/846,160
    	
 
    	
3/18/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Non-invasive   Prenatal Paternity Testing
    	
 
    	
WO2012/088456
    	
 
    	
PCT/US11/66938
    	
 
    	
12/22/2011
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for   Preimplantation Genetic Diagnosis by Sequencing
    	
 
    	
 
    	
 
    	
PCT/US12/058578
    	
 
    	
10/3/2012
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Highly Multiplex PCR   Methods and Compositions
    	
 
    	
 
    	
 
    	
13/683,604
    	
 
    	
11/21/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Highly Multiplex PCR   Methods and Compositions
    	
 
    	
 
    	
 
    	
PCT/US12/66339
    	
 
    	
11/21/2012
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Highly Multiplex PCR   Methods and Compositions
    	
 
    	
 
    	
 
    	
61/767,865
    	
 
    	
2/22/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Informatics Enhanced   Analysis of Fetal Samples Subject to Maternal Contamination
    	
 
    	
 
    	
 
    	
13/780,022
    	
 
    	
2/28/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Informatics Enhanced   Analysis of Fetal Samples Subject to Maternal Contamination
    	
 
    	
 
    	
 
    	
PCT/US2013/28378
    	
 
    	
2/28/2013
    	
 
    	
PCT
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    
	
Methods for Increasing   Fetal Fraction in Maternal Blood
    	
 
    	
 
    	
 
    	
13/793,316
    	
 
    	
3/11/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN / Natera
    

 

 

	
Title
    	
 
    	
Publication No.
    	
 
    	
Application No.
    	
 
    	
Filing Date
    	
 
    	
Country
    	
 
    	
Status
    	
 
    	
Patent No
    	
 
    	
Issue
   Date
    	
 
    	
Expiration
   Date
    	
 
    	
Assignee
    
	
Methods   for Increasing Fetal Fraction in Maternal Blood
    	
 
    	
 
    	
 
    	
61/743,423
    	
 
    	
9/4/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Improved   Methods and Reagents for Quantification of Amplification Products
    	
 
    	
 
    	
 
    	
61/675,020
    	
 
    	
7/24/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Non-Invasive Prenatal Testing Using Parental Mosaicism Data
    	
 
    	
 
    	
 
    	
61/684,243
    	
 
    	
8/17/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   for Non-Invasive Prenatal Testing Using Parental Mosaicism Data
    	
 
    	
 
    	
 
    	
61/790,108
    	
 
    	
3/15/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   and Compositions for Reducing Genetic Library Contamination
    	
 
    	
 
    	
 
    	
61/683,331
    	
 
    	
8/15/2012
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    
	
Methods   and Compositions for Reducing Genetic Library Contamination
    	
 
    	
 
    	
 
    	
61/790,222
    	
 
    	
3/15/2013
    	
 
    	
US
    	
 
    	
Pending
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
GSN   / Natera
    

 

 

EXHIBIT B

to Security Agreement

Execution Version

 

TRADEMARK SECURITY AGREEMENT

 

This TRADEMARK SECURITY AGREEMENT, dated as of April 18, 2013 (this “Agreement”), is made by NATERA, INC., a Delaware corporation (the “Grantor”), in favor of ROS ACQUISITION OFFSHORE LP, a Cayman Islands Exempted Limited Partnership (together with its Affiliates, successors, transferees and assignees, the “Lender”).

 

W I T N E S S E T H:

 

WHEREAS, pursuant to a Credit Agreement, dated as of April 18, 2013 (as amended, supplemented, or otherwise modified from time to time, the “Credit Agreement”), by and between Natera, Inc., a Delaware corporation (the “Borrower”) and the Lender, the Lender has extended a Commitment to make the Loans to the Borrower;

 

WHEREAS, in connection with the Credit Agreement, the Grantor and its Affiliates have executed and delivered a Pledge and Security Agreement in favor of the Lender, dated as of  April 18, 2013 (as amended, supplemented, or otherwise modified from time to time, the “Security Agreement”);

 

WHEREAS, pursuant to the Credit Agreement and pursuant to clause (e) of Section 4.5 of the Security Agreement, the Grantor is required to execute and deliver this Agreement and to grant to the Lender a continuing security interest in all of the Trademark Collateral (as defined below) to secure all of the Obligations; and

 

WHEREAS, the Grantor has duly authorized the execution, delivery and performance of this Agreement; 

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Grantor agrees, for the benefit of each Lender, as follows:

 

SECTION 1.  Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Agreement, including its preamble and recitals, have the meanings provided (or incorporated by reference) in the Security Agreement. 

 

SECTION 2.  Grant of Security Interest.  The Grantor hereby grants to the Lender, for its benefit, a continuing security interest in all of Grantor’s right, title and interest in and to the following property, whether now or hereafter existing or acquired by the Grantor (the “Trademark Collateral”): 

 

(a)   (i) all of its trademarks, trade names, corporate names, company names, business names, fictitious business names, trade styles, service marks, certification marks, collective marks, logos and other source or business identifiers, and all goodwill of the business associated therewith, including those referred to in Item A of Schedule I hereto, whether currently in use or not, all registrations and recordings thereof and all applications in connection therewith, whether pending or filed, including registrations, recordings and applications in the United States Patent and Trademark Office or in any office or agency of the United States of America or any State thereof, and all

 

 

common-law rights relating to the foregoing, and (ii) the right to obtain all reissues, extensions or renewals of the foregoing (collectively referred to as the “Trademarks”);

 

(b)   all Trademark licenses for the grant by or to the Grantor of any right to use any Trademark, including each Trademark license referred to in Item B of Schedule I hereto; 

 

(c)   all of the goodwill of the business connected with the use of, and symbolized by the items described in, clause (a), and to the extent applicable clause (b);

 

(d)   the right to sue third parties for past, present and future infringements of any Trademark Collateral described in clause (a) and, to the extent applicable, clause (b); and

 

(e)   all Proceeds of, and rights associated with, the foregoing, including any claim by the Grantor against third parties for past, present or future infringement or dilution of any Trademark, Trademark registration or Trademark license, or for any injury to the goodwill associated with the use of any such Trademark or for breach or enforcement of any Trademark license and all rights corresponding thereto throughout the world.

 

SECTION 3.  Security Agreement.  This Agreement has been executed and delivered by the Grantor for the purpose of registering the security interest of the Lender in the Trademark Collateral with the United States Patent and Trademark Office.  The security interest granted hereby has been granted in furtherance of, and not in limitation of, the security interest granted to the Lender for its benefit under the Security Agreement.  The Security Agreement (and all rights and remedies of the Lender thereunder) shall remain in full force and effect in accordance with its terms.

 

SECTION 4.  Release of Liens.  Upon (i) the Disposition of Trademark Collateral in accordance with the Credit Agreement or (ii) the occurrence of the Termination Date, the security interests granted herein shall automatically terminate with respect to (A) such Trademark Collateral (in the case of clause (i)) or (B) all Trademark Collateral (in the case of clause (ii)).  Upon any such Disposition or termination, the Lender will, at the Grantor’s sole expense, deliver to the Grantor, without any representations, warranties or recourse of any kind whatsoever, all Trademark Collateral held by the Lender hereunder, and execute and deliver to the Grantor such documents as the Grantor shall reasonably request to evidence such termination.

 

SECTION 5.  Acknowledgment.  The Grantor does hereby further acknowledge and affirm that the rights and remedies of the Lender with respect to the security interest in the Trademark Collateral granted hereby are more fully set forth in the Security Agreement, the terms and provisions of which (including the remedies provided for therein) are incorporated by reference herein as if fully set forth herein.

 

SECTION 6.  Loan Document.  This Agreement is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed,

 

2

 

administered and applied in accordance with the terms and provisions thereof, including Article X thereof.

 

SECTION 7.  Effective.  This Agreement shall become effective when a counterpart hereof executed by the Grantor, shall have been received by the Lender.  Delivery of an executed counterpart of a signature page to this Agreement by email (e.g. “pdf” or “tiff”) or telecopy shall be effective as delivery of a manually executed counterpart of this Agreement.

 

[Signature Page Follows]

 

3

 

Execution Version

 

IN WITNESS WHEREOF, the Grantor hereto has caused this Agreement to be duly executed and delivered by its Authorized Officer as of the date first above written.

 

 

	
 
    	
NATERA, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Matthew Rabinowitz
    
	
 
    	
 
    	
Name:
    	
Matthew   Rabinowitz
    
	
 
    	
 
    	
Title:
    	
Chief   Executive Officer
    

 

[ Signature Page to Trademark Security Agreement ]

 

 

SCHEDULE I

to Trademark Security Agreement

 

Item A

 

See attached. 

 

Item B

 

None.

 

[ Schedules to Trademark Security Agreement ]

 

 

TRADEMARKS

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of
    Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest Information
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
PRENATUS
    	
 
    	
85/467718
    	
 
    	
 
    	
 
    	
Allowed
    	
 
    	
US
    	
 
    	
11/8/2011
    	
 
    	
 
    	
 
    	
42 Int. medical laboratory services; genetic testing   for scientific research purposes in the field of human reproduction 

 

44 Int. genetic testing for medical purposes and   genetic counseling in the field of human reproduction
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
85/487673
    	
 
    	
4203883
    	
 
    	
Registered
    	
 
    	
US
    	
 
    	
12/5/2011
    	
 
    	
09/04/12
    	
 
    	
42 Int. medical and scientific research and analysis   in the field of genetic testing; providing medical and scientific research   information in the field of genetic testing; medical laboratory services;   genetic testing for scientific research and analysis purposes; genetic   testing for scientific research and analysis purposes in the field of human   reproduction; providing a website featuring information in the field of   genetic testing for scientific purposes 

 

44 Int. genetic testing for medical purposes;   genetic counseling; genetic testing for medical purposes and genetic   counseling in the field of human reproduction; providing a website featuring   information about genetic testing for medical purposes and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of
    Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest Information
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
10930469
    	
 
    	
10930469
    	
 
    	
Registered
    	
 
    	
EP
    	
 
    	
6/1/2012
    	
 
    	
10/30/12
    	
 
    	
42 Int. medical and scientific research in the field   of genetic testing; providing medical and scientific research information in   the field of genetic testing; medical and scientific research and analysis in   the field of genetic testing; medical laboratory services; genetic testing or   scientific research and analysis purposes; genetic testing for scientific   research and analysis purposes in the field of human reproduction; providing   a website featuring information in the field of genetic testing medical purposes;   medical laboratory services 

 

44 Int. genetic testing; genetic counseling; genetic   testing and genetic counseling in the field of human reproduction; providing   a website featuring information about genetic testing and genetic counseling;   genetic testing for medical purposes; genetic testing for medical purposes   and genetic counseling in the field of human reproduction; providing a   website featuring information about genetic testing for medical purposes and   genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
1580172
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
CA
    	
 
    	
6/1/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and scientific research in the field   of genetic testing; providing medical and scientific research information in   the field of genetic testing 

 

44 Int. medical laboratory services; genetic   testing; genetic counseling; genetic testing and genetic counseling in the   field of human reproduction; providing a website featuring information about   genetic testing and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
11022636
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
CN
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and scientific research in the field   of genetic testing; providing medical and scientific research information in   the field of genetic testing
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of
    Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest Information
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
11022635
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
CN
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
44 Int. medical laboratory services; genetic   testing; genetic counseling; genetic testing and genetic counseling in the field   of human reproduction; providing a website featuring information about   genetic testing and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of
    Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest Information
    
	
NATERA
    	
 
    	
2012-44502
    	
 
    	
5521348
    	
 
    	
Registered
    	
 
    	
JP
    	
 
    	
6/4/2012
    	
 
    	
09/14/12
    	
 
    	
42 Int. medical and scientific research and analysis in the   field of genetic  testing, providing medical and scientific   research information in the field of genetic testing, testing;   inspection or research on therapeutic approaches and techniques related to   medical treatment and providing information thereof, genetic   testing for scientific research and analysis purposes, genetic testing for   scientific research and analysis purposes in the field of human   reproduction, hosting computer sites (web sites) featuring information   in the field of genetic testing for medical purposes, research and   development for others, providing information in the field of   medical research, testing; inspection or research for medical care, computer software   design, testing; inspection or research for medical care, computer software   design; computer programming or maintenance of computer of   computer software with respect to medical data, design of surgical   instruments, analysis; research in the field of medical care and consultation   thereof, testing or research on machines; apparatus and instruments   and their parts for medical purposes  

 

44 Int. genetic testing for medical purposes, counseling for   medical purposes in the field of genetic, genetic testing for medical purpose   and counseling as medical purposes related to inheritance in the field of   human reproduction, providing information on gene therapy, medical services;   providing medical information, counseling and advice on health care,   counseling and advice on providing of medical information
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of
    Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest Information
    
	
NATERA
    	
 
    	
1494690
    	
 
    	
 
    	
 
    	
Published
    	
 
    	
AU
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and scientific research in the field of genetic   testing; providing  medical and scientific research   information in the field of genetic testing  

 

44 Int. medical laboratory services; genetic testing; genetic   counseling; genetic testing and genetic counseling in the field of human   reproduction; providing a website featuring information about genetic testing   and genetic counseling, namely providing information about genetic testing   and genetic counseling via a website
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
2012718511
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
RU (Russian
    Federation)
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and scientific research and analysis in the   field of genetic  testing; providing medical and scientific   research information in the field of genetic testing; medical   laboratory services; genetic testing for scientific research and analysis purposes;   genetic testing for scientific research and analysis purposes in the field of   human reproduction; providing a website featuring information   in the field of genetic testing for medical purposes 

 

44 Int. genetic testing for medical purposes; genetic   counseling; genetic testing for medical purposes and genetic counseling in   the field of human reproduction; providing a website featuring information   about genetic testing for medical purposes and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
840152647
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
BR (Brazil)
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and scientific research and analysis in the   field of genetic testing; providing medical and  scientific   research information in the field of genetic testing; medical laboratory   services; genetic testing for scientific research and analysis   purposes; genetic testing for scientific research and analysis purposes in   the field of human reproduction; providing a website featuring information   in the field of genetic testing for medical purposes
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of
    Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest Information
    
	
NATERA
    	
 
    	
840152671
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
BR
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
44 Int. genetic testing for medical purposes; genetic   counseling; genetic testing for medical purposes and genetic counseling in   the field of human reproduction; providing a website featuring information   about genetic testing for medical purposes and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
NATERA
    	
 
    	
2343007
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
IN (India)
    	
 
    	
6/5/2012
    	
 
    	
 
    	
 
    	
42 Int. medical and scientific research and analysis in the   field of genetic testing; providing medical and scientific research   information in the field of genetic testing; medical laboratory services;   genetic testing for scientific research and analysis purposes; genetic   testing for scientific research and analysis purposes in the field of human   reproduction; providing a website featuring information in the field of   genetic testing for medical purposes

 

44 Int. genetic testing for medical purposes; genetic   counseling; genetic testing for medical purposes and genetic counseling in   the field of human reproduction; providing a website featuring information   about genetic testing for medical purposes and genetic counseling
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

	
Trademark
    	
 
    	
Appl. #
    	
 
    	
Reg. #
    	
 
    	
Status
    	
 
    	
Country of  Reg.
    	
 
    	
Appl. Dt
    	
 
    	
Reg. Dt
    	
 
    	
Goods and Services
    	
 
    	
Owner
    	
 
    	
Security Interest Information
    
	
PANORAMA
    	
 
    	
85/776044
    	
 
    	
 
    	
 
    	
Filed
    	
 
    	
US (foreign filing  options are open)
    	
 
    	
11/9/2012
    	
 
    	
 
    	
 
    	
01 Int. kits and reagents for genetic testing for medical and   scientific  research purposes; kits and reagents for   genetic testing for medical and scientific research purposes in   the field of human reproduction; kits and reagents for prenatal testing for   medical and scientific research purposes; nucleic acid based kits   and reagents for testing for fetal chromosomal abnormalities for medical   and scientific research purposes    

 

42 Int. genetic testing for scientific research purposes;   genetic testing for scientific research purposes in the field of human   reproduction; prenatal testing for scientific research purposes; testing for   fetal chromosomal abnormalities for research purposes; scientific,   laboratory, clinical, medical, and technological research and analysis   services in the fields of nucleic acid analysis, prenatal testing, and   genetics; medical laboratory services; providing a website featuring   information about genetic testing for  scientific research purposes;   providing a website featuring information about prenatal   testing for scientific research purposes  

 

44 Int. genetic testing for medical purposes; genetic testing   for medical purposes in the field of human reproduction; prenatal testing for   medical purposes; testing for fetal chromosomal abnormalities for  medical   purposes; genetic counseling; providing a website featuring   information about genetic testing and genetic counseling for medical   purposes; providing a website featuring information about   prenatal testing and genetic counseling for medical purposes
    	
 
    	
GSN / Natera
    	
 
    	
 
    

 

 

EXHIBIT C

to Security Agreement

Execution Version

 

COPYRIGHT SECURITY AGREEMENT

 

Not Applicable.

 

 

ANNEX I 

to Security Agreement

 

SUPPLEMENT TO

PLEDGE AND SECURITY AGREEMENT

 

This SUPPLEMENT, dated as of                 ,       (this “Supplement”), is to the Pledge and Security Agreement, dated as of [      ], 2013 (as amended, supplemented, amended and restated or otherwise modified from time to time, the “Security Agreement”), among the Grantors (such term, and other terms used in this Supplement, to have the meanings set forth in Article I of the Security Agreement) from time to time party thereto, in favor of ROS ACQUISITION OFFSHORE LP, a Cayman Islands Exempted Limited Partnership (together with its Affiliates, successors, transferees and assignees, the “Lender”). 

 

W I T N E S S E T H :  

 

WHEREAS, pursuant to a Credit Agreement, dated as of [      ], 2013 (as amended, supplemented, or otherwise modified from time to time, the “Credit Agreement”), by and between Natera, Inc., a Delaware corporation (the “Borrower”) and the Lender, the Lender has extended a Commitment to make the Loans to the Borrower; 

 

WHEREAS, pursuant to the provisions of Section 7.6 of the Security Agreement, each of the undersigned is becoming a Grantor under the Security Agreement; and 

 

WHEREAS, each of the undersigned desires to become a “Grantor” under the Security Agreement in order to induce the Lender to continue to extend Loans under the Credit Agreement; 

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of the undersigned agrees, for the benefit of the Lender, as follows. 

 

SECTION 1.  Party to Security Agreement, etc.  In accordance with the terms of the Security Agreement, by its signature below, each of the undersigned hereby irrevocably agrees to become a Grantor under the Security Agreement with the same force and effect as if it were an original signatory thereto and each of the undersigned hereby (a) agrees to be bound by and comply with all of the terms and provisions of the Security Agreement applicable to it as a Grantor and (b) represents and warrants that the representations and warranties made by it as a Grantor thereunder are true and correct as of the date hereof, unless stated to relate solely to an earlier date, in which case such representations and warranties shall be true and correct as of such earlier date.  In furtherance of the foregoing, each reference to a “Grantor” and/or “Grantors” in the Security Agreement shall be deemed to include each of the undersigned. 

 

SECTION 2.  Schedules.  Each of the undersigned Grantors hereby authorizes the Lender to add the information set forth on the Schedules to this Supplement to the correlative Schedules attached to the Security Agreement.

 

 

SECTION 3.  Representations.  Each of the undersigned Grantors hereby represents and warrants that this Supplement has been duly authorized, executed and delivered by it and that this Supplement and the Security Agreement constitute its legal, valid and binding obligation, enforceable against it in accordance with its terms. 

 

SECTION 4.  Full Force of Security Agreement.  Except as expressly supplemented hereby, the Security Agreement shall remain in full force and effect in accordance with its terms. 

 

SECTION 5.  Severability.  Wherever possible each provision of this Supplement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Supplement shall be prohibited by or invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Supplement or the Security Agreement. 

 

SECTION 6.  Governing Law, Entire Agreement, etc.  THIS SUPPLEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS SECURITY AGREEMENT OR ANY DOCUMENT CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).  This Supplement, along with the other Loan Documents, constitutes the entire understanding among the parties hereto with respect to the subject matter thereof and supersedes any prior agreements, written or oral, with respect thereto. 

 

SECTION 7.  Effective.  This Supplement shall become effective when a counterpart hereof executed by the Grantor shall have been received by the Lender.  Delivery of an executed counterpart of a signature page to this Agreement by email (e.g. “pdf” or “tiff”) or telecopy shall be effective as delivery of a manually executed counterpart of this Agreement. 

 

[Signature Page Follows]

 

2

 

IN WITNESS WHEREOF, each of the parties hereto has caused this Supplement to be duly executed and delivered by its Authorized Officer as of the date first above written.

 

	
 
    	
[NAME   OF ADDITIONAL SUBSIDIARY]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:   
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
[NAME   OF ADDITIONAL SUBSIDIARY]
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:   :
    
	
 
    	
 
    	
Title
    

 

Signature Page to Security Agreement Supplement

 

 

[COPY SCHEDULES FROM SECURITY AGREEMENT]Exhibit 10.8.3

 

Execution Version

 

CONFIDENTIAL TREATMENT REQUESTED

ROYALTY AGREEMENT

 

This ROYALTY AGREEMENT, dated as of April 18, 2013 (as amended, supplemented or otherwise modified from time to time, this “Royalty Agreement”), is made by and between ROYALTY OPPORTUNITIES S.ÀR.L, a Luxembourg société à responsabilité limitée (together with its Affiliates, successors, transferees and assignees, “ROS”), and Natera, Inc., a Delaware corporation (“Natera”). ROS and Natera are sometimes referred to herein individually as a “Party” and collectively as the “Parties”.

 

W I T N E S S E T H :

 

WHEREAS, ROS Acquisition Offshore LP, a Cayman Islands Exempted Limited Partnership (“Lender”), and Natera have entered into that certain Credit Agreement, dated as of the date hereof (as subsequently amended or otherwise modified, the “Credit Agreement”); and

 

WHEREAS, the execution and delivery of this Royalty Agreement is a condition precedent to the making of the Initial Loan pursuant to the Credit Agreement.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and in order to induce ROS to make the Loans pursuant to the Credit Agreement, the Parties hereto agree as follows.

 

ARTICLE I.
 DEFINITIONS

 

SECTION 1.1                                             Certain Terms. The following terms (whether or not underscored) when used in this Royalty Agreement, including its preamble and recitals, shall have the following meanings (such definitions to be equally applicable to the singular and plural forms thereof):

 

“Applicable Amount” has the meaning set forth in the definition of “Purchase Price”.

 

“Applicable Period” has the meaning set forth in the definition of “Purchase Price”.

 

“Bankruptcy Event” means any Event of Default of the type described in Section 9.1(h) of the Credit Agreement.

 

“Buy-Out Notice” has the meaning set forth in Section 2.6.

 

“Buy-Out Option” has the meaning set forth in Section 2.6.

 

“Confidential Information” means any and all information or material (whether written or oral, or in electronic or other form) that, at any time before, on or after the Closing Date, has been or is provided or communicated to the Receiving Party by or on behalf of the Disclosing Party pursuant to this Royalty Agreement or in connection with the transactions contemplated hereby or any discussions or negotiations with respect thereto, and shall include the existence and terms of this Royalty Agreement.

 

 

“Contract” means any contract, license, indenture, instrument or agreement. 

 

“Credit Agreement” has the meaning set forth in the recitals hereto.

 

“Default Rate” means the rate of interest applicable to Loans under Section 3.5 of the Credit Agreement.

 

“Disclosing Party” means the Party disclosing Confidential Information.

 

“Judgment” means any judgment, injunction, order or decree.

 

“Law” means any law, statute, rule, regulation or ordinance of any Governmental Authority that may be in effect from time to time.

 

“Lender” has the meaning set forth in the recitals hereto. 

 

“Natera” has the meaning set forth in the preamble hereto.

 

“Net Revenue” means consolidated net sales, distribution income, service payments, license income, and other forms of consideration made to Natera and its Subsidiaries related to all products and services (including all Products) and shall be determined in accordance with GAAP. Net Revenue shall be determined in a manner consistent with the methodologies, practices and procedures used in developing Natera’s audited financial statements.

 

“Party” and “Parties” have the meanings set forth in the preamble hereto.

 

“Payments” means the Royalty Payments, the payment of the Purchase Price and any other payments to be made by Natera to ROS hereunder.

 

“Pledge and Security Agreement” means the Pledge and Security Agreement among Natera, Natera International Inc. and the Lender.

 

“Purchase Price” means, with respect to either (x) Natera’s election to exercise its Buy-Out Option at any time, or (y) ROS’s election to exercise its Put Option upon the occurrence of a Royalty Event of Default, an amount, payable by Natera to ROS in U.S. Dollars to an account designated in writing by ROS, equal to the difference between (i) the applicable amount set forth in the table below (the “Applicable Amount”) opposite the applicable period (the “Applicable Period”) set forth in the table below, during which such Buy-Out Option or Put Option as the case may be, was exercised (or deemed to be exercised), less (ii) the Recovered Amount. The Purchase Price shall not be less than zero.

 

2

 

	
Applicable Period
    	
 
    	
Applicable Amount if
   the Delayed Draw Loan
   Has Not Been Funded
    	
 
    	
Applicable Amount if 
   the Delayed Draw Loan
   Has Been Funded
    	
 
    
	
On or before   the 1st anniversary of the   Closing Date
    	
 
    	
$
    	
8,000,000
    	
 
    	
$
    	
11,000,000
    	
 
    
	
After the   1st anniversary of the Closing Date and on or before the 2nd anniversary of   the Closing Date
    	
 
    	
$
    	
8,875,000
    	
 
    	
$
    	
12,000,000
    	
 
    
	
After the   2nd anniversary of the Closing Date and on or before the 3rd anniversary of   the Closing Date
    	
 
    	
$
    	
9,750,000
    	
 
    	
$
    	
13,000,000
    	
 
    
	
After the   3rd anniversary of the Closing Date and on or before the 4th anniversary of   the Closing Date
    	
 
    	
$
    	
10,625,000
    	
 
    	
$
    	
14,000,000
    	
 
    
	
Any time   after the 4th anniversary of the Closing Date
    	
 
    	
$
    	
11,500,000
    	
 
    	
$
    	
15,000,000
    	
 
    

 

“Put Notice” has the meaning set forth in Section 5.2.  

 

“Put Option” has the meaning set forth in Section 5.2.  

 

“Receiving Party” means the Party receiving Confidential Information.

 

“Recipients” has the meaning set forth in Section 7.1.

 

“Recovered Amount” means, as of the time the Purchase Price is paid pursuant to Section 2.6 hereof, the aggregate amount of all Royalty Payments previously paid to ROS by Natera or any Subsidiary pursuant to Section 2.1 as of the Fiscal Quarter last ended.

 

“Related Agreement” means any existing or future Contract entered into before or during the Royalty Term by Natera or any of its Subsidiaries (i) relating in any material respect, directly or indirectly, to any Product or (ii) that could reasonably be expected to affect in any material respect, directly or indirectly, the value of the Royalty Payments.

 

“Related Party” means any Party (other than Natera or any of its Subsidiaries) to any Related Agreement.

 

“ROS” has the meaning set forth in the preamble hereto.

 

“Royalty Agreement” has the meaning set forth in the preamble hereto. 

 

“Royalty Event of Default” has the meaning set forth in Section 5.1.

 

3

 

“Royalty Payment” has the meaning set forth in Section 2.1(b).  

 

“Royalty Report” has the meaning set forth in Section 2.1(c).

 

“Royalty Term” means the period commencing on the Closing Date and ending on the earlier of (i) the tenth anniversary of the Closing Date and (ii) the date of payment of the Purchase Price pursuant to the exercise of the Put Option by ROS or the exercise of the Buy-Out Option by Natera, as the case may be.

 

“Term” has the meaning set forth in Section 6.1.

 

“Third Party” means any Person, other than Natera or any of its Subsidiaries.

 

SECTION 1.2                                             Credit Agreement Definitions. Unless otherwise defined herein or the context otherwise requires, terms used in this Royalty Agreement, including its preamble and recitals, have the meanings provided in the Credit Agreement. In the event that the Credit Agreement terminates (in accordance with its terms or otherwise) prior to the expiration of the Term, terms used herein and defined in the Credit Agreement (as in effect immediately prior to such termination) shall continue to be used herein without regard to such earlier termination of the Credit Agreement (as if such agreement remained in full force and effect).

 

ARTICLE II.
 ROYALTY PROVISIONS

 

SECTION 2.1                                             Royalty Payments.

 

(a)                                 Natera shall (or shall cause a Subsidiary to) pay to ROS, in respect of each Fiscal Year (or portion of a Fiscal Year, in the case of the first Fiscal Year and last Fiscal Year of the Royalty Term) during the Royalty Term and prior to the Fiscal Quarter in which the Delayed Draw Loan is funded, a royalty amount equal to the sum of (i) 1.00% of the aggregate Net Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) up to $50,000,000 of such Net Revenue, plus (ii) 1.50% of the aggregate Net Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) in excess of $50,000,000.

 

(b)                                 Natera shall (or shall cause a Subsidiary to) pay to ROS, in respect of each Fiscal Year (or portion of a Fiscal Year, in the case of the first Fiscal Year and last Fiscal Year of the Royalty Term) during the Royalty Term and during the Fiscal Quarter in which the Delayed Draw Loan has been funded and thereafter, a royalty amount equal to the sum of (i) 1.50% of the aggregate Net Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) up to $50,000,000 of such Net Revenue, plus (ii) 2.00% of the aggregate Net Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) in excess of $50,000,000.

 

(c)                                  Amounts payable pursuant to Section 2.1(a) and Section 2.1(b) shall be calculated quarterly as of the last day of each Fiscal Quarter during the Royalty Term, and shall be payable by Natera to ROS within [*] after the end of each such Fiscal Quarter (each such payment, a “Royalty Payment”). The first Royalty Payment shall be

 

[*] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

 

4

 

determined based on Net Revenue for the entire first Fiscal Month following the month in which the Closing Date occurs through to the last Fiscal Month of the Fiscal Quarter in which the Closing Date occurs, and the last Royalty Payment (other than in the case of the Royalty Term ending on the date of payment of the Purchase Price pursuant to the exercise of the Put Option by ROS or the exercise of the Buy-Out Option by Natera) shall be determined based on the Net Revenue for the Fiscal Quarter up to the last day of the Fiscal Month in which the last day of the Royalty Term occurs. Royalty Payments shall first be determined in the currency of the country in which the corresponding Net Revenue occurred and then converted to its equivalent in U.S. Dollars. The rates of exchange for such payments shall be the average rate for U.S. Dollars, as quoted by JPMorgan Chase in New York City, at the close of business on the last day of the Fiscal Quarter in which such Net Revenue occurred.

 

(d)                                 Together with each Royalty Payment, Natera shall deliver a written report to ROS showing with respect to each Product (on a product-by-product and country-by-country basis) (i) Net Revenue for such Product in such country for the applicable Fiscal Quarter, including line items for any deductions to the gross invoiced amount made pursuant to the definition of Net Revenue, and (ii) the calculation (in reasonable detail) of the Royalty Payment owed (including any applicable exchange rates used) and paid for such Fiscal Quarter (each, a “Royalty Report”). Each delivery of a Royalty Report hereunder shall also be deemed to constitute a representation and warranty by Natera that such Royalty Report is true, correct and complete in all material respects (subject to normal year-end audit adjustments; provided that if such adjustments shall result in an increase in the calculation of Net Revenue, the calculations of Royalty Payments owed shall be adjusted to account for such increase and the Borrower shall immediately pay any Royalty Payment amounts owed); provided, that the sole remedy for any error, unless Royalty Payments are demonstrated in more than two Fiscal Quarters to be understated by more than [*] percent ([*]%) for each such Fiscal Quarter, shall be as provided in Section 2.4.  

 

SECTION 2.2                                             General Provisions as to Payments. All amounts payable to ROS under this Royalty Agreement (including the Payments) shall be (i) made [*] of any kind or nature whatsoever, (ii) made in U.S. Dollars and in immediately available funds and (iii) remitted by wire transfer to such bank account as shall have been designated by ROS in writing from time to time. Any Payments or other amounts due to ROS under this Royalty Agreement that are not made on or before the applicable due date shall, upon demand by ROS, bear interest, payable on demand (and compounded monthly), for each day from (and including) the applicable due date to (but excluding) the date of the payment thereof, at a rate per annum equal to the Default Rate.

 

SECTION 2.3                                             Taxes. The Parties hereby covenant and agree that, with respect to any Taxes payable on any Payments payable to ROS under this Royalty Agreement, Section 4.3 of the Credit Agreement shall apply and is hereby incorporated herein by reference as if set forth herein in its entirety; provided that references in such Section 4.3 to the “Borrower” shall be deemed to mean Natera, references to the “Lender” shall be deemed to mean ROS, and references to the Credit Agreement shall be deemed to mean this Royalty Agreement.

 

[*] 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 PORTION.

 

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SECTION 2.4                                             Records and Audit.

 

(a)                                 Natera shall keep and maintain at its chief executive office in the United States complete and accurate records (on a product-by-product and country-by-country basis) of all sales, Net Revenue, and deductions to arrive at Net Revenue and Royalty Payments until the latest of (i) [*] years after the period to which such records relate, (ii) the expiration of the applicable tax statute of limitations, and (iii) such longer period as applicable Law requires.

 

(b)                                 Natera shall not later than [*] following its determination of Net Revenue and Royalty Payments for any Fiscal Quarter (or more frequently if Natera so elects) send written notice to ROS containing such Net Revenue and Royalty Payments determination. Natera shall provide to ROS reasonable access at reasonable times after [*] and during regular business hours of Natera to the personnel, properties, books and records of Natera solely for the purpose of a review by ROS of the calculation of Net Revenue and Royalty Payments; and ROS shall have the right, not more than [*] through the Term, at ROS’s expense (except as set forth below), at reasonable times after [*] and during regular hours of Natera, to investigate and audit such records, upon reasonable notice (and may, if it so chooses, retain an independent accountant to conduct such investigation and audit as and to the extent provided in Section 2.4(d)). Natera shall, and shall cause its Subsidiaries to, cooperate fully and completely with all reasonable requests with respect to such investigation and audit (and the Persons conducting such investigation and audit), and all results of any investigation and any audit under this Section 2.4 (and any associated underlying data and information) shall be made available to both Natera and ROS.

 

(c)                                  Within [*] after the delivery of any Royalty Report to ROS, ROS shall be entitled to request an audit of the Net Revenue or Royalty Payments determination with respect to previously delivered Royalty Reports (the “Audit Request”).

 

(d)                                 Within [*] after delivery to Natera of the Audit Request, if the Parties are not able to agree on the Net Revenue and Royalty Payments determination, then ROS shall be entitled to engage an independent auditor or valuation firm reasonably acceptable to Natera (the “Independent Firm”) to audit the Net Revenue and Royalty Payments calculations. Upon the engagement of the Independent Firm, both Natera and ROS will direct the Independent Firm to render a determination within [*] of its engagement, and Natera, ROS and their respective agents will cooperate with the Independent Firm during its engagement. The determination of the chosen Independent Firm shall be conclusive and shall become final and binding upon the parties hereto.

 

(e)                                  The fees and expenses of any investigation or audit under this Section 2.4, including fees and expenses of the Independent Firm, shall be borne by ROS; provided, however, that if the Independent Firm determines that Natera’s initial Net Revenue as set forth in the Royalty Report has resulted in an underpayment of a Royalty Payment due to

 

[*] 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 PORTION.

 

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ROS for any Fiscal Quarter by more than [*] percent ([*]%), then Natera shall pay the such reasonable fees and expenses of the Independent Firm conducting the audit.

 

(f)                                   If any investigation or audit under this Section 2.4 reveals an underpayment of a Royalty Payment, then Natera shall remit such underpayment to ROS not later than [*] after the completion of such investigation or audit. If any such investigation or audit reveals an overpayment, then ROS shall remit such overpayment to Natera not later than [*] after the completion of such investigation or audit.

 

SECTION 2.5                                             Related Agreements; Access to Records.

 

(a)                            Natera shall, and shall cause its Subsidiaries to, provide ROS, upon request, with true, correct and complete copies of each Related Agreement (including all amendments and supplements thereto).

 

(b)                            Natera shall, and shall cause its Subsidiaries to, provide ROS with access to records required to be maintained pursuant to Section 2.4 to verify and audit the Net Revenue attributable to Natera or such Subsidiaries in accordance with the audit and inspection process described in Section 2.4. Natera will use commercially reasonable efforts to [*] and relevant to any audit or inspection process described in Section 2.4.

 

SECTION 2.6                                             Buy-Out Option. At any time after the Closing Date, Natera shall have the right, exercisable in its sole discretion (the “Buy-Out Option”), to purchase from ROS all (but not less than all) of its rights to the remaining Royalty Payments that will become due pursuant to Section 2.1. The amount payable by Natera to ROS in respect of the Buy-Out Option shall be the Purchase Price. If Natera elects to exercise its Buy-Out Option, it shall so notify ROS in writing (the “Buy-Out Notice”), which Buy-Out Notice shall set forth a calculation of the Purchase Price in reasonable detail. Delivery of a Buy-Out Notice (and exercise of the Buy-Out Option) shall be irrevocable. Unless ROS disputes in writing, within five (5) Business Days of its receipt of the Buy-Out Notice and with reasonable specificity the calculation of the Purchase Price prior to tender of the Purchase Price (in which case the Buy-Out Notice shall be of no force or effect), Natera shall, on the tenth Business Day following ROS’s receipt of such Buy-Out Notice, purchase from ROS all (but not less than all) of its rights to the remaining Royalty Payments that will become due pursuant to Section 2.1. The payment of the Purchase Price shall be made by wire transfer of immediately available funds to an account designated by ROS, or, if not timely designated by ROS, to the ROS account set forth on its signature page to this Agreement.

 

SECTION 2.7                                             Release of Excess Collateral Security. At any time after the Termination Date, promptly upon request of Natera, so long as no Royalty Event of Default then exists, ROS agrees to release and reconvey to Natera, or to subordinate in favor of a third party lender designated by Natera, ROS’s Lien on Excess Collateral Security, and further agrees to execute and deliver, at Natera’s sole cost and expense, such financing statement amendments and releases, or subordination agreements if applicable, as reasonably requested by Natera in connection therewith. As used herein, “Excess Collateral Security” means any asset or

 

[*] 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 PORTION.

 

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properties of Natera over which ROS then has a Lien as requested by Natera so long as, after giving effect to such collateral release or subordination the then applicable maximum Purchase Price is fully secured by a letter of credit in a form and issued by a bank, in each case reasonably acceptable to ROS.

 

SECTION 2.8                                             Lender Appointed as Agent. ROS hereby appoints Lender to act as ROS’s agent as set forth in Section 5.5 of the Pledge and Security Agreement.

 

ARTICLE III.
 REPRESENTATIONS AND WARRANTIES

 

Natera hereby represents and warrants to ROS as of the Closing Date as follows:

 

SECTION 3.1                                             Credit Agreement Representations and Warranties. The representations and warranties of the Borrower contained in Article VI of the Credit Agreement are true and correct in all material respects, each such representation and warranty set forth in such Article and all other terms of the Credit Agreement to which reference is made therein, together with all related definitions and ancillary provisions, being hereby incorporated into this Royalty Agreement by this reference as though specifically set forth in this Article. Without limiting the foregoing, Section 6.17 Permits and Section 6.18 Regulatory Matters of the Credit Agreement are incorporated herein by this reference and Natera represents and warrants that the representations and warranties set forth therein are true and correct. 

 

SECTION 3.2                                             Enforceability. Natera has the power and authority and the legal right to enter into this Royalty Agreement and perform its obligations hereunder and has taken all necessary action on its part required to authorize the execution and delivery of this Royalty Agreement and the performance of its obligations hereunder. This Royalty Agreement has been duly executed and delivered on behalf of Natera, constitutes a legal, valid and binding obligation of Natera and is enforceable against Natera in accordance with its terms (except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization or similar Laws affecting creditors’ rights generally and by principles of equity).

 

SECTION 3.3                                             Related Agreements. None of Natera or any of the Subsidiaries has breached or defaulted under any provision of any Related Agreement in any material respect, and, to the knowledge of Natera no Related Party has breached or defaulted under any provision of any Related Agreement in any material respect. To the knowledge of Natera, except as otherwise disclosed in writing to ROS, no event has occurred that, upon notice or passage of time or both, could reasonably be expected to give rise to any breach or termination of or default under any Related Agreement by any party thereto.

 

ARTICLE IV.
 COVENANTS

 

Natera covenants and agrees with ROS that throughout the Term Natera will, and will cause each of its Subsidiaries to, perform or cause to be performed the obligations set forth below.

 

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SECTION 4.1                                             Transactions with Affiliates. None of Natera or any of its Subsidiaries will enter into or cause or permit to exist any arrangement, transaction or contract (including for the purchase, lease or exchange of property or the rendering of services) with any of its Affiliates, unless:

 

(a) such arrangement, transaction or contract is:

 

(x)(i) between or among Natera or any of its Subsidiaries, (ii) provides normal and reasonable compensation, benefits, reimbursement of expenses and indemnification to officers and directors, (iii) is a cash Investment in Natera, or (iv) is between or among Natera or any of its Subsidiaries on the one hand and a Permitted Joint Venture on the other hand and is not otherwise prohibited hereunder, and

 

(y)(i) is on fair and reasonable terms no less favorable to Natera or any Subsidiary than it could obtain in an arm’s-length transaction with a Person that is not one of its Affiliates and (ii) is of the kind which would be entered into by a prudent Person in its position with a Person that is not one of its Affiliates; or

 

(b) such arrangement, transaction or contract is not between or among Natera and any Parallel Entity and Natera has:

 

(x) provided ROS with not less than [*] prior written notice of such arrangement, transaction or contract and (y) certified in writing to ROS that such arrangement, transaction or contract (i) satisfies the requirements of clause (a)(y), and (ii) has been approved by Natera’s board of directors; or

 

(c) such arrangement, transaction or contract is approved by ROS.

 

SECTION 4.2                                             Maintenance of Existence; Licenses; Compliance with Laws and Related Agreements. Natera and each of the Subsidiaries shall (a) preserve and maintain its legal existence (except as otherwise permitted by Section 8.7 of the Credit Agreement), (b) preserve and maintain in all material respects all rights, privileges, Permits and franchises necessary or desirable in the normal conduct of its business, (c) comply in all material respects with all Laws and Judgments applicable to it, and (d) perform in all material respects its obligations under the Related Agreements to which Natera or any of the Subsidiaries is a party, except to the extent that the failure to do so could not reasonably be expected to affect in any material respect the value of the Royalty Payments.

 

SECTION 4.3                                             Maintenance of Patents. Natera and each of the Subsidiaries shall prosecute and maintain, at its own expense, each Patent included in the Intellectual Property, unless the failure to prosecute and maintain such Patent either (a) [*] or (b) [*].

 

[*] CERTAIN INFORMATION IN THIS DOCUMENT HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION. CONFIDENTIAL TREATMENT HAS BEEN REQUESTED WITH RESPECT TO THE OMITTED PORTION.

 

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SECTION 4.4                                             Enforcement of Intellectual Property

 

(a)                                 Natera shall promptly inform ROS of any suspected infringement by a Third Party of any Intellectual Property that Natera determines in its reasonable business judgment is reasonably likely to adversely affect in any material respect the value of the Royalty Payments. Natera shall promptly provide ROS with a copy of any written notice of any such suspected infringement of Intellectual Property delivered or received by Natera or any of its Subsidiaries as soon as practicable and in any event not less than [*] following such delivery or receipt.

 

(b)                                 Natera shall have the right (but not the obligation) to initiate, at its sole expense, an enforcement of the Intellectual Property against any Third Party. All sums received (including awards, damages and settlement payments) for compensatory damages only as a result of any enforcement of the Intellectual Property by Natera under this Section 4.4(b), after deduction of all reasonable costs and expenses (including attorneys’ fees and expenses) incurred by Natera in connection with such enforcement, shall be included in the calculation of Net Revenue for the Fiscal Quarter in which any such amounts are indefeasibly received by Natera.

 

SECTION 4.5                                             Challenges to Intellectual Property.

 

(a)                                 Natera shall promptly inform ROS of any written notice of any challenge to the Intellectual Property that could reasonably be expected to adversely affect in any material respect the value of the Royalty Payments, and shall provide to ROS a copy of any such written notice of any such written notice received by Natera or any of its Subsidiaries as soon as practicable and in any event not less than five business days following such receipt.

 

(b)                                 Natera shall have the right (but not the obligation) to initiate, at its sole expense, a defense against such challenge to the Intellectual Property. If Natera elects to bring such a defense, Natera shall so notify ROS and use commercially reasonable efforts to defend the Intellectual Property against such challenge. Natera shall provide prompt written notice to ROS of the initiation of such defense. All sums received (including awards, damages and settlement payments), if any, as a result of any such defense by Natera under this Section 4.5(b) shall for all purposes be excluded from the calculation of Net Revenue; provided, that the net amount received by Natera pursuant to any cross claim or counterclaim on account of compensatory damages only shall be included in the calculation of Net Revenue to the same extent as such amounts would be included pursuant to an enforcement of Intellectual Property under Section 4.4(b).

 

(c)                                  In the event that Natera determines that it will not defend against such challenge to the Intellectual Property, Natera shall promptly inform ROS of that determination and ROS shall have the right (but not the obligation) to defend such challenge, on behalf of Natera but at ROS’s sole expense (an “ROS Defense”), subject to Section 4.5(d), and Natera agrees to be named as a party to any action, suit or other proceeding in connection therewith, if, in ROS’s view, it is necessary or desirable to do so. ROS shall (i) provide prompt written notice to Natera of the initiation of such defense and (ii) keep Natera promptly informed of the status of, and all material developments in, such defense. Natera shall also, at ROS’s sole expense, cooperate fully with ROS and

 

[*] 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 PORTION.

 

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provide such assistance as ROS may reasonably request in connection with such ROS Defense. All sums received (including awards, damages and settlement payments), if any, as a result of any such ROS Defense of the Intellectual Property by ROS under this Section 4.5(c) shall be allocated be allocated 95% to ROS and 5% to Natera and shall for all purposes be excluded from the calculation of Net Revenue.

 

(d)                                 In the event that ROS decides to pursue an ROS Defense, ROS agrees to indemnify Natera, each of its Subsidiaries and each of their respective officers, directors, employees and agents (collectively, the “Indemnified Parties”) for, and to defend, exonerate and hold Natera and each other Indemnified Party free and harmless, from and against, any and all actions, causes of action, suits, losses, costs, liabilities, obligations and damages, and expenses incurred in connection with or as a consequence of each and every ROS defense (including with respect to any counterclaims or cross claims and irrespective of whether any such Indemnified Party is a party to the action for which indemnification hereunder is sought), including reasonable attorneys’ and professionals’ fees and disbursements, whether incurred in connection with actions between the parties hereto or the parties hereto and Third Parties.

 

SECTION 4.6                                             [Intentionally omitted]

 

SECTION 4.7                                             Related Agreements. Promptly, and in any event within [*] following Natera becoming aware of a breach of any Related Agreement by a Related Party, in each case that could reasonably be expected to adversely affect in any material respect the value of the Royalty Payments, Natera shall provide notice of such breach to ROS. In addition, Natera shall provide to ROS a copy of any written notice of any such breach or alleged breach of any Related Agreement delivered or received by Natera or any of its Subsidiaries as soon as practicable and in any event not less than [*] following such delivery or receipt.

 

SECTION 4.8                                             No Impairments; Diligence. Natera agrees to meet such standards in developing and marketing the Products as are reasonable and customary in the industry and as required by this Royalty Agreement, until such time as Natera determines in its sole discretion that the Products is not “commercially marketable”. Nothing in this Royalty Agreement, however, will require Natera to develop, sell or market the Products should Natera determine, in its sole judgment, that a Product is not commercially marketable. In the event of a determination that the Products are not commercially marketable, Natera shall provide ROS with prompt written notice of such determination.

 

SECTION 4.9                                             Further Assurances; Information. Natera shall, shall cause each of its Subsidiaries to furnish, execute and deliver such additional documents, certificates, instruments, and statements, provide such additional data and information, and perform such additional acts, in each case, as may be reasonably requested by ROS in connection with, or in furtherance of, any of the provisions of this Royalty Agreement.

 

[*] 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 PORTION.

 

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ARTICLE V.
 EVENTS OF DEFAULT; REMEDIES

 

SECTION 5.1                                             Events of Default. The occurrence of any of the following events shall constitute a “Royalty Event of Default” under this Royalty Agreement:

 

(a)                                 Natera shall default in the payment (i) of any Royalty Payment when due hereunder, or (ii) any other payment when due  hereunder, and in the case of clause (ii) such default shall continue for a period of thirty days after such amount was due, or (iii) default in the payment when due (after any applicable period of grace) of any amount under the Credit Agreement;

 

(b)                                 Any representation or warranty of Natera contained or incorporated by reference herein, or in any Royalty Report, shall at any time prove to have been incorrect in any material respect when made;

 

(c)                                  An Event of Default (after any applicable period of grace) shall exist under Section 9.1(c) of the Credit Agreement;

 

(d)                                 Natera or any Subsidiary shall default in the due performance and observance of any other covenant, obligation or agreement contained in any Loan Document executed by it, and such default shall continue unremedied for a period of 30 days after the earlier to occur of (i) notice thereof given to Natera by ROS or (ii) the date on which Natera has knowledge of such default;

 

(e)                                  a default shall occur in the payment of any amount when due (subject to any applicable grace period), whether by acceleration or otherwise, of any principal or stated amount of or interest or fees on, any Indebtedness of Natera or any of the Subsidiaries having a principal or stated amount, individually or in the aggregate, in excess of $500,000, or a default shall occur in the performance or observance of any obligation or condition with respect to such Indebtedness if the effect of such default is to accelerate the maturity of any such Indebtedness or such default shall continue unremedied for any applicable period of time sufficient to permit the holder or holders of such Indebtedness, or any trustee or agent for such holders, to cause or declare such Indebtedness to become due and payable or to require such Indebtedness to be prepaid, redeemed, purchased or defease, or require an offer to purchase or defease such Indebtedness to be made, prior to its expressed maturity;

 

(f)                                   any judgment or order for the payment of money individually or in the aggregate in excess of $500,000 (exclusive of any amounts fully covered by insurance (less any applicable deductible) and as to which the insurer has acknowledged its responsibility to cover such judgment or order) shall be rendered against Natera or any of the Subsidiaries and such judgment shall not have been vacated or discharged or stayed or bonded pending appeal within 30 days after the entry thereof or enforcement proceedings shall have been commenced by any creditor upon such judgment or order;

 

(g)                                  any Loan Document shall (except in accordance with its terms) terminate or the terms thereof shall cease to be the legally valid, binding and enforceable obligation

 

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of Natera or any Subsidiary thereto; Natera or any Subsidiary shall contest in any manner such validity, binding nature or enforceability; or, except as permitted under any Loan Document, any Lien securing any Obligation shall, in whole or in any material part, cease to be a perfected first priority Lien;

 

(h)                                 any Key Permit or any of Natera’s or any Subsidiary’s material rights or interests thereunder is terminated or amended in any manner materially adverse to Natera or Natera and its Subsidiaries taken as a whole;

 

(i)                                     any circumstance occurs that has had or would reasonably be expected to cause a Material Adverse Effect;

 

(j)                                    (i) the FDA, CMS, EMA or any other Governmental Authority (A) issues a letter or other communication asserting that any Product lacks a required Regulatory Authorization or (B) initiates enforcement action against, or issues a warning letter with respect to, Natera or any of the Subsidiaries, or any of their Products or the manufacturing facilities therefor, that causes Natera or such Subsidiary to discontinue marketing or withdraw any of its material Products, or causes a material delay in the manufacture or offering of any of its material Products, which discontinuance, withdrawal or delay could reasonably be expected to last for more than three months; (ii) a recall; or (iii) Natera or any of the Subsidiaries enters into a settlement agreement with the FDA, CMS, EMA or any other Governmental Authority, if any of the foregoing has had or would reasonably be expected to have or result in a Material Adverse Effect;

 

(k)                                 Any Change in Control shall occur; or

 

(l)                                     Natera or (except as permitted under the Credit Agreement) any of its Subsidiaries shall

 

(i)                                     become insolvent or generally fail to pay, or admit in writing its inability or unwillingness generally to pay, debts as they become due;

 

(ii)                                  apply for, consent to, or acquiesce in the appointment of a trustee, receiver, sequestrator or other custodian for any substantial part of the property of any thereof, or make a general assignment for the benefit of creditors;

 

(iii)                               in the absence of such application, consent or acquiescence in or permit or suffer to exist the appointment of a trustee, receiver, sequestrator or other custodian for a substantial part of the property of any thereof, and such trustee, receiver, sequestrator or other custodian shall not be discharged within 60 days; provided that, Natera hereby expressly authorizes ROS to appear in any court conducting any relevant proceeding during such 60 day period to preserve, protect and defend its rights under this Royalty Agreement;

 

(iv)                              permit or suffer to exist the commencement of any bankruptcy, reorganization, debt arrangement or other case or proceeding under any bankruptcy or insolvency law or any dissolution, winding up or liquidation proceeding, in respect thereof, and, if any such case or proceeding is not

 

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commenced by Natera, such case or proceeding shall be consented to or acquiesced in by Natera, or shall result in the entry of an order for relief or shall remain for 60 days undismissed; provided that, Natera hereby expressly authorizes ROS to appear in any court conducting any such case or proceeding during such 60 day period to preserve, protect and defend its rights under this Royalty Agreement; or

 

(v)                                 take any action authorizing, or in furtherance of, any of the foregoing.

 

SECTION 5.2                                             Put Option. Upon the occurrence of, and during the continuation of, any Royalty Event of Default, in addition to any other rights and remedies available to ROS under this Royalty Agreement, any other Loan Document or otherwise, ROS shall have the right (at its option) to require Natera to purchase from ROS all of its rights to the remaining Royalty Payments that will become due pursuant to Section 2.1 (the “Put Option”). The amount payable by Natera to ROS in respect of the Put Option shall be the Purchase Price. If ROS elects to exercise its Put Option, it shall so notify Natera in writing (the “Put Notice”), which Put Notice shall set forth a calculation of the Purchase Price in reasonable detail. Natera shall, on the fifth Business Day following its receipt of such Put Notice, pay the Purchase Price to ROS. The payment of the Purchase Price pursuant to this Section 5.2 shall be made by wire transfer of immediately available funds to an account designated by ROS.

 

SECTION 5.3                                             Other Rights and Remedies.

 

(a)                                   ROS shall have the right to enforce the provisions of this Royalty Agreement or any other Loan Document by legal proceedings for the specific performance of any covenant or agreement contained herein or for the enforcement of any other appropriate legal or equitable remedy, and ROS may recover its costs and expenses caused by any breach by Natera of the provisions of this Royalty Agreement or as a result of, or in connection with, the occurrence of any Royalty Event of Default, including court costs, attorneys’ fees and other costs and expenses incurred in the enforcement of the obligations of Natera, or any rights of ROS, under this Royalty Agreement.

 

(b)                                   ROS shall have the right to exercise all rights and remedies under this Royalty Agreement or any other Loan Document and all other rights and remedies which ROS may have under applicable Law or otherwise.

 

ARTICLE VI.
 TERM

 

SECTION 6.1                                             Term. The term of this Royalty Agreement (the “Term”) shall commence on the Closing Date and shall expire on the first anniversary of the last day of the Royalty Term.

 

SECTION 6.2                                             Survival. The expiration of this Royalty Agreement shall be without prejudice to any rights or obligations of the Parties that may have accrued prior to such

 

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expiration or termination, and the provisions of Article VII and Sections 6.2, 8.4, 8.5, 8.8, 8.9, 8.11 and 8.12 shall survive the expiration of this Royalty Agreement.

 

ARTICLE VII.
 CONFIDENTIALITY

 

SECTION 7.1                                             Confidential Information. Subject to the provisions of Section 7.2, at all times prior to the fifth anniversary of the Royalty Term, the Receiving Party shall keep confidential and shall not publish or otherwise disclose any Confidential Information furnished to it by the Disclosing Party, except to those of the Receiving Party’s employees, advisors or consultants who have a need to know such information to assist such Party in the performance of such Party’s obligations or in the exercise of such Party’s rights hereunder and who are subject to obligations of confidentiality consistent with these provisions (collectively, “Recipients”). Notwithstanding anything to the contrary set forth herein, (a) ROS may disclose this Royalty Agreement and the terms and conditions hereof and any information related hereto, including the Royalty Reports (other than to any Competitor of Natera or any of its Subsidiaries) to (i) its Affiliates, (ii) potential and actual assignees of any of ROS’s rights hereunder (including the right to receive any Payments hereunder) and (iii) potential and actual investors in, or lenders to, ROS (including, in each of the foregoing cases, such Person’s employees, advisors or consultants); provided that in each case, each such Recipient shall be subject to reasonable obligations of confidentiality; and (b) upon receiving consent from ROS, which consent shall not be unreasonably withheld, delayed or conditioned, Natera may disclose this Royalty Agreement and the terms and conditions hereof and information related hereto, to potential or actual permitted acquirers or assignees, collaborators and other (sub)licensees, permitted subcontractors, investment bankers, investors, lenders (including, in each of the foregoing cases, such Person’s employees, advisors or consultants who have a need to receive and review such information); provided that in each case, each such Recipient shall be subject to reasonable obligations of confidentiality. In addition to the foregoing, the Receiving Party may disclose Confidential Information belonging to the Disclosing Party to the extent (and only to the extent) such disclosure is reasonably necessary in order to comply with applicable laws (including any securities law or regulation or the rules of a securities exchange) and with judicial process, if in the reasonable opinion of the Receiving Party’s counsel, such disclosure is necessary for such compliance, provided that the Receiving Party (x) will only disclose those portions of the Confidential Information that are necessary or required to be so disclosed, (y) to the extent legally permissible, will notify the Disclosing Party of the Receiving Party’s intent to make any disclosure pursuant thereto, and (z) to the extent reasonably practicable, the Receiving Party shall provide such notice in advance of the disclosure so as to allow the Disclosing Party an opportunity to seek (at the Disclosing Party’s sole expense) a protective order or other appropriate remedy; provided, however, that no such notice will be required in respect of disclosures of Confidential Information to regulatory authorities having or claiming to have jurisdiction over the Receiving Party in connection with routine regulatory examinations. In the event that no such protective order or other remedy is obtained or that the Disclosing Party waives compliance with the provisions hereof, the Receiving Party and its Representatives may disclose such Confidential Information as may be required or requested pursuant to such laws or judicial process.

 

15

 

SECTION 7.2                                             Exceptions to Confidentiality. The Receiving Party’s obligations set forth in this Royalty Agreement shall not extend to any Confidential Information of the Disclosing Party:

 

(a)                                 that is or hereafter becomes part of the public domain (other than as a result of a disclosure by the Receiving Party or its Recipients in violation of this Royalty Agreement);

 

(b)                                 that is received from a Third Party without restriction on disclosure and without, to the knowledge of the Receiving Party, breach of any agreement between such Third Party and the Disclosing Party;

 

(c)                                  that the Receiving Party can demonstrate by competent evidence was already in its possession without any limitation on disclosure prior to its receipt from the Disclosing Party;

 

(d)                                 that is generally made available to Third Parties by the Disclosing Party without restriction on disclosure; or

 

(e)                                  that the Receiving Party can demonstrate by competent evidence was independently developed by the Receiving Party.

 

SECTION 7.3                                             Remedies. Each Party agrees that the unauthorized disclosure of any information by the Receiving Party in violation of this Royalty Agreement will cause severe and irreparable damage to the Disclosing Party. In the event of any violation of this Article 7, the Receiving Party agrees that the Disclosing Party shall [*].

 

SECTION 7.4                                             Press Releases. No Party shall, and each Party shall instruct its Affiliates not to, issue a press release or other public announcement or otherwise make any public disclosure with respect to this Royalty Agreement or the subject matter hereof without the prior consent of the other Party hereto (which consent shall not be unnecessarily withheld or delayed), except as may be required by applicable Law (in which case the Party required to make the release or statement shall allow the other Party reasonable time to comment on such release or statement in advance of such issuance).

 

ARTICLE VIII.
 MISCELLANEOUS PROVISIONS

 

SECTION 8.1                                             Loan Document. This Royalty Agreement is a Loan Document executed pursuant to the Credit Agreement and shall (unless otherwise expressly indicated herein) be construed, administered and applied in accordance with Article X thereof (including Section 10.4 thereof), which is incorporated herein by reference and deemed to apply to Natera, ROS and this Royalty Agreement, as applicable, throughout the Term (whether or not, and without regard to, any earlier termination of the Credit Agreement).

 

[*] 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 PORTION.

 

16

 

SECTION 8.2                                             Binding on Successors, Transferees and Assigns; Assignment. This Royalty Agreement shall remain in full force and effect until the Term has concluded and shall be binding upon the Parties hereto and their respective successors, transferees and assigns; provided that Natera may not assign or transfer any of its rights or obligations hereunder without the prior written consent of ROS; and provided  further that ROS may not assign or transfer any of its rights or obligations hereunder to any Competitor without the prior written consent of Natera, except in the event that (i) a Royalty Event of Default has occurred and (ii) such Royalty Event of Default continues for thirty (30) days after ROS has notified Natera of its intent to make such an assignment or transfer to a Competitor.

 

SECTION 8.3                                             Amendments, etc. No amendment to or waiver of any provision of this Royalty Agreement, nor consent to any departure by Natera from its obligations under this Royalty Agreement, shall in any event be effective unless the same shall be in writing and signed by ROS, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given.

 

SECTION 8.4                                             Notices. All notices and other communications provided for hereunder shall be given or made as set forth in Section 10.2 of the Credit Agreement. Documents required to be delivered pursuant to Section 2.1(d),  Section 2.4(b),  Section 4.4.(a),  Section 4.7 and Section 4.8 may be delivered electronically and if so delivered, shall be deemed to have been delivered on the date on which (i) Natera posts such documents, or provides a link thereto on Natera’s website or the Internet at the following website address: [*] or (ii) such documents are posted on Natera’s behalf on an Internet or intranet website, if any, to which ROS has access (whether a commercial or third-party website), and in each case an email with a link to such posting has been provided to ROS’s email addresses set forth on Schedule 10.2 of the Credit Agreement.

 

SECTION 8.5                                             No Waiver; Remedies. No failure on the part of ROS to exercise, and no delay in exercising, any right hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any right hereunder preclude any other or further exercise thereof or the exercise of any other right. The remedies herein provided are cumulative and not exclusive of any remedies provided by Law.

 

SECTION 8.6                                             Section Captions. Section captions used in this Royalty Agreement are for convenience of reference only and shall not affect the construction of this Royalty Agreement.

 

SECTION 8.7                                             Severability. Any provision of this Royalty Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such provision and such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions of this Royalty Agreement or affecting the validity or enforceability of such provision in any other jurisdiction.

 

SECTION 8.8                                             Governing Law, Entire Agreement, etc. THIS ROYALTY AGREEMENT AND ANY CLAIMS, CONTROVERSY, DISPUTE OR CAUSE OF ACTION (WHETHER IN CONTRACT OR TORT OR OTHERWISE) BASED UPON, ARISING OUT OF OR RELATING TO THIS ROYALTY AGREEMENT SHALL BE GOVERNED BY, AND

 

[*] 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 PORTION.

 

17

 

CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK). This Royalty Agreement, along with the other Loan Documents, constitutes the entire understanding among the parties hereto with respect to the subject matter hereof and supersedes any prior agreements, written or oral, with respect hereto.

 

SECTION 8.9                                             Forum Selection and Consent to Jurisdiction. ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS ROYALTY AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF ROS OR ANY GUARANTOR IN CONNECTION HEREWITH, SHALL BE BROUGHT AND MAINTAINED IN THE COURTS OF THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN THE STATE OF NEW YORK OR IN THE UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK; PROVIDED THAT ANY SUIT SEEKING ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT THE OPTION OF ROS, IN THE COURTS OF ANY JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH OF NATERA AND ROS IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE STATE OF NEW YORK AT THE ADDRESS FOR NOTICES SPECIFIED IN SECTION 10.2 OF THE CREDIT AGREEMENT. EACH OF NATERA AND ROS HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT EITHER NATERA OR ROS HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OR FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS PROPERTY, EACH OF NATERA AND ROS, ON ITS OWN BEHALF HEREBY IRREVOCABLY WAIVES TO THE FULLEST EXTENT PERMITTED BY LAW SUCH IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS ROYALTY AGREEMENT.

 

SECTION 8.10                                      Counterparts. This Royalty Agreement may be executed by the parties hereto in several counterparts, each of which shall be an original and all of which shall constitute together but one and the same agreement. This Royalty Agreement shall become effective when counterparts hereof executed on behalf of Natera and ROS shall have been received by ROS. Delivery of an executed counterpart of a signature page to this Royalty Agreement by email (e.g. “pdf’ or “tiff’) or telecopy shall be effective as delivery of a manually executed counterpart of this Royalty Agreement.

 

SECTION 8.11                                      Waiver of Jury Trial. NATERA AND ROS HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE TO THE FULLEST EXTENT PERMITTED BY LAW ANY RIGHTS THEY MAY HAVE TO A TRIAL BY JURY

 

18

 

IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS ROYALTY AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF NATERA OR ROS IN CONNECTION HEREWITH. EACH OF NATERA AND ROS ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR ROS AND NATERA, RESPECTIVELY TO ENTER INTO THIS ROYALTY AGREEMENT.

 

SECTION 8.12                                      Relationship of the Parties. The status of a Party under this Royalty Agreement shall be that of an independent contractor. Nothing contained in this Royalty Agreement shall be construed as creating a partnership, joint venture or agency relationship between Natera or any of its Affiliates, on the one hand, and ROS or any of its Affiliates, on the other hand. Except to the limited extent expressly provided in this Royalty Agreement, no Party hereto shall have the authority to bind, obligate or represent any other Party hereto.

 

[Signature Page Follows]

 

19

 

IN WITNESS WHEREOF, the Parties have executed this Royalty Agreement on the day and year first above written.

 

	
 
    	
NATERA, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Matthew   Rabinowitz
    
	
 
    	
Name:
    	
Matthew Rabinowitz
    
	
 
    	
Title:
    	
Chief Executive Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ROYALTY OPPORTUNITIES S.AR.L
    
	
 
    	
By OrbiMed Advisors   LLC,
    
	
 
    	
its investment manager
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Samuel D. Isaly
    
	
 
    	
Name:
    	
Samuel D. Isaly
    
	
 
    	
Title:
    	
Managing Member
    
	
 
    	
 
    
	
 
    	
Account Information:
    
	
 
    	
 
    
	
 
    	
Number:
    	
[*]
    
	
 
    	
Bank:
    	
[*]
    
	
 
    	
Address:
    	
[*]
    
	
 
    	
 
    	
 
    
	
 
    	
[*]
    	
 
    
				

 

Signature Page to Royalty Agreement

 

[*] 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 PORTION.

 

 

Execution Version

 

FIRST AMENDMENT TO ROYALTY AGREEMENT

 

This FIRST AMENDMENT TO ROYALTY AGREEMENT (this “Amendment”) is made and entered into as of June 6, 2014 by and among NATERA, INC., a Delaware corporation (“Natera”), and ROYALTY OPPORTUNITIES S.À R.L, a Luxembourg société à responsabilité limitée (“ROS”).

 

WHEREAS, Natera and ROS are party to that certain Royalty Agreement, dated as of April 18, 2013 (the “Royalty Agreement”);

 

WHEREAS, pursuant to Section 8.3 of the Royalty Agreement, the Royalty Agreement may be amended by an instrument in writing signed by ROS; and

 

WHEREAS, Natera and ROS hereto desire to amend certain provisions of the Royalty Agreement as provided in this Amendment.

 

NOW, THEREFORE, in consideration of the mutual agreements herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

 

1.             Definitions; Loan Document. Capitalized terms used herein without definition shall have the meanings assigned to such terms in the Royalty Agreement. This Amendment shall constitute a Loan Document for all purposes of the Royalty Agreement and the other Loan Documents.

 

2.             Amendment to Definition of Purchase Price. The definition of “Purchase Price” in Section 1.1  of the Royalty Agreement is hereby amended so that the definition reads in its entirety as follows:

 

“Purchase Price” means, with respect to either (x) Natera’s election to exercise its Buy-Out Option at any time, or (y) ROS’s election to exercise its Put Option upon the occurrence of a Royalty Event of Default, an amount, payable by Natera to ROS in U.S. Dollars to an account designated in writing by ROS, equal to the difference between (i) the applicable amount set forth in the table below (the “Applicable Amount”) opposite the applicable period (the “Applicable Period”) set forth in the table below, during which such Buy-Out Option or Put Option, as the case may be, was exercised (or deemed to be exercised), less (ii) the Recovered Amount. The Purchase Price shall not be less than zero.

 

 

	
 
    	
 
    	
 
    	
 
    	
Applicable
    	
 
    	
Applicable
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
Amount if the
    	
 
    	
Amount if the
    	
 
    
	
 
    	
 
    	
Applicable
    	
 
    	
Delayed Draw Loan
    	
 
    	
Delayed Draw Loan
    	
 
    
	
 
    	
 
    	
Amount if the Delayed
    	
 
    	
Has Been Funded in
    	
 
    	
Has Been Funded in
    	
 
    
	
 
    	
 
    	
Draw Loan Has Not
    	
 
    	
an Amount Equal to
    	
 
    	
an Amount Equal to
    	
 
    
	
Applicable Period
    	
 
    	
Been Funded
    	
 
    	
$10,000,000
    	
 
    	
$20,000,000
    	
 
    
	
On or before the 1st anniversary of the Closing Date
    	
 
    	
$
    	
8,000,000
    	
 
    	
$
    	
10,000,000
    	
 
    	
$
    	
11,000,000
    	
 
    
	
After the 1st anniversary of the Closing Date and on   or before the 2nd anniversary of the Closing Date
    	
 
    	
$
    	
8,875,000
    	
 
    	
$
    	
11,000,000
    	
 
    	
$
    	
12,000,000
    	
 
    
	
After the 2nd   anniversary of the Closing Date and on or before the 3rd anniversary of the   Closing Date
    	
 
    	
$
    	
9,750,000
    	
 
    	
$
    	
12,000,000
    	
 
    	
$
    	
13,000,000
    	
 
    
	
After the 3rd   anniversary of the Closing Date and on or before the 4th anniversary of the   Closing Date
    	
 
    	
$
    	
10,625,000
    	
 
    	
$
    	
13,000,000
    	
 
    	
$
    	
14,000,000
    	
 
    
	
Any time after   the 4th anniversary of the Closing Date
    	
 
    	
$
    	
11,500,000
    	
 
    	
$
    	
14,000,000
    	
 
    	
$
    	
15,000,000
    	
 
    

 

3.             Amendment to Section 2.1(b). Section 2.1 of the Royalty Agreement is hereby amended by deleting clause (b) of such Section and replacing such clause with the following:

 

“(b) Natera shall (or shall cause a Subsidiary to) pay to ROS, in respect of each Fiscal Year (or portion of a Fiscal Year, in the case of the first Fiscal Year and last Fiscal Year of the Royalty Term) during the Royalty Term and during the Fiscal Quarter in which the Delayed Draw Loan has been funded and thereafter, a royalty amount equal to (i) if the Delayed Draw Loan has been funded in an amount equal to $10,000,000 the sum of (x) 1.00% of the aggregate Net Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) up to $50,000,000 of such Net Revenue, plus (y) 1.50% of the aggregate Net Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) in excess of $50,000,000 or (ii) if the Delayed Draw Loan has been funded in an amount equal to $20,000,000 the sum of (A) 1.50% of the aggregate Net Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) up to $50,000,000 of such Net Revenue, plus  (B)  2.00% of the aggregate Net

 

2

 

Revenue during such Fiscal Year (or portion of a Fiscal Year, as the case may be) in excess of $50,000,000.”

 

4.           Conditions to Effectiveness of Amendment. This Amendment shall become effective upon receipt by ROS of (i) a Secretary’s Certificate, in a form reasonably acceptable to ROS, duly executed and delivered by the signatories thereto, and (ii) a counterpart signature to this Amendment duly executed and delivered by Natera.

 

5.           Expenses. [*]

 

6.           No Implied Amendment or Waiver. Except as expressly set forth in this Amendment, this Amendment shall not, by implication or otherwise, limit, impair, constitute a waiver of or otherwise affect any rights or remedies of ROS under the Royalty Agreement or the other Loan Documents, or alter, modify, amend or in any way affect any of the terms, obligations or covenants contained in the Royalty Agreement or the other Loan Documents, all of which shall continue in full force and effect. Nothing in this Amendment shall be construed to imply any willingness on the part of ROS to agree to or grant any similar or future amendment, consent or waiver of any of the terms and conditions of the Royalty Agreement or the other Loan Documents.

 

7.           Counterparts; Governing Law. This Amendment may be executed in any number of counterparts and by different parties hereto on separate counterparts, each of such when so executed and delivered shall be an original, but all of such counterparts shall together constitute but one and the same agreement. Delivery of an executed counterpart of a signature page of this Amendment by fax transmission or other electronic mail transmission (e.g., “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart of this Amendment. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING FOR SUCH PURPOSE SECTIONS 5-1401 AND 5-1402 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK).

 

[Remainder of Page Intentionally Left Blank]

 

[*] 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 PORTION.

 

3

 

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their respective officers thereunto duly authorized as of the day and year first above written.

 

 

	
 
    	
NATERA, INC.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Matthew Rabinowitz
    
	
 
    	
Name:
    	
Matthew Rabinowitz
    
	
 
    	
Title:
    	
Chief Executive   Officer
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ROYALTY   OPPORTUNITIES S.À R.L,
    
	
 
    	
 
    
	
 
    	
By OrbiMed   Advisors LLC,
    
	
 
    	
its investment   manager
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Samuel D. Isaly
    
	
 
    	
Name:
    	
Samuel D. Isaly
    
	
 
    	
Title:
    	
Managing Member
    

 

Signature Page to First Amendment to Royalty Agreement

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