Document:

Exhibit 4.2

 

SURGIQUEST, INC.

 

FOURTH AMENDED AND RESTATED INVESTORS’ RIGHTS AGREEMENT

 

March 10, 2015

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    	
 
    
	
A.
    	
Amendments of Prior Rights   Agreement; Waiver of Right of First Offer
    	
2
    
	
 
    	
 
    	
 
    	
 
    
	
1.
    	
Registration Rights
    	
2
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
1.1
    	
Definitions
    	
2
    
	
 
    	
1.2
    	
Request for   Registration
    	
3
    
	
 
    	
1.3
    	
Company Registration
    	
5
    
	
 
    	
1.4
    	
Form S-3   Registration
    	
5
    
	
 
    	
1.5
    	
Obligations of the   Company
    	
6
    
	
 
    	
1.6
    	
Information From   Holders
    	
8
    
	
 
    	
1.7
    	
Expenses of   Registration
    	
8
    
	
 
    	
1.8
    	
Underwriting   Requirements
    	
8
    
	
 
    	
1.9
    	
Delay of Registration
    	
9
    
	
 
    	
1.10
    	
Indemnification
    	
9
    
	
 
    	
1.11
    	
Reports Under the   Exchange Act
    	
11
    
	
 
    	
1.12
    	
Assignment of   Registration Rights
    	
11
    
	
 
    	
1.13
    	
Limitations on   Subsequent Registration Rights
    	
12
    
	
 
    	
1.14
    	
Lock-Up Agreement
    	
12
    
	
 
    	
1.15
    	
Termination of   Registration Rights
    	
13
    
	
 
    	
 
    	
 
    	
 
    
	
2.
    	
Covenants of the   Company
    	
13
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
2.1
    	
Delivery of Financial   Statements
    	
13
    
	
 
    	
2.2
    	
Inspection
    	
14
    
	
 
    	
2.3
    	
Right of First Offer
    	
14
    
	
 
    	
2.4
    	
Qualified Small Business   Stock Status
    	
16
    
	
 
    	
2.6
    	
Expenses of Board   Members
    	
16
    
	
 
    	
2.7
    	
Equity Compensation
    	
16
    
	
 
    	
2.7
    	
Insurance
    	
16
    
	
 
    	
2.5
    	
Termination of   Covenants
    	
17
    
	
 
    	
 
    	
 
    	
 
    
	
3.
    	
Miscellaneous
    	
17
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
3.1
    	
Termination
    	
17
    
	
 
    	
3.2
    	
Entire Agreement
    	
17
    
	
 
    	
3.3
    	
Successors and Assigns
    	
17
    
	
 
    	
3.4
    	
Amendments and Waivers
    	
17
    
	
 
    	
3.5
    	
Notices
    	
18
    
	
 
    	
3.6
    	
Severability
    	
18
    
	
 
    	
3.7
    	
Governing Law
    	
18
    
	
 
    	
3.8
    	
Counterparts
    	
18
    
	
 
    	
3.9
    	
Titles and Subtitles
    	
18
    
	
 
    	
3.10
    	
Aggregation of Stock
    	
18
    

 

i

 

SURGIQUEST, INC.

 

FOURTH AMENDED AND RESTATED INVESTORS’ RIGHTS AGREEMENT

 

This Fourth Amended and Restated Investors’ Rights Agreement (this “Agreement”) is made as of the 10th day of March, 2015, by and among SurgiQuest, Inc., a Delaware corporation (the “Company”), the holders of the Company’s Series A Preferred Stock set forth on Exhibit A hereto (the “Series A Holders”), the holders of the Company’s Series B Preferred Stock set forth on Exhibit B hereto (the “Series B Holders”), the holders of the Company’s Series C Preferred Stock set forth on Exhibit C hereto (the “Series C Holders”), the holders of the Company’s Series D Preferred Stock set forth on Exhibit D hereto (the “Series D Holders”) and the purchasers of the Company’s Series E Preferred Stock set forth on Exhibit E hereto (the “Series E Purchasers” and together with the Series A Holders, the Series B Holders, the Series C Holders and the Series D Holders, the “Investors”).

 

RECITALS

 

A.                                    The Company, the Series D Holders, the Series C Holders, the Series B Holders and the Series A Holders have previously entered into a Third Amended and Restated Investors’ Rights Agreement dated as of September 27, 2012 (the “Prior Rights Agreement”), pursuant to which the Company granted the Series A Holders, the Series B Holders, the Series C Holders and the Series D Holders certain rights.

 

B.                                    The Company and the Series E Purchasers entered into a Series E Preferred Stock Purchase Agreement dated as of the date hereof (the “Purchase Agreement”) pursuant to which the Company agreed to sell to the Series E Purchasers and the Series E Purchasers agreed to purchase from the Company shares of the Company’s Series E Preferred Stock on the terms and conditions set forth therein. A condition to the Series E Purchasers’ obligations under the Purchase Agreement is that the undersigned enter into this Agreement in order to provide the Series E Purchasers with (i) certain rights to register shares of the Company’s Common Stock issuable upon conversion of the Series E Preferred Stock held by the Series E Purchasers, (ii) certain rights to receive or inspect information pertaining to the Company, and (iii) a right of first offer with respect to certain issuances by the Company of its securities. The Company desires to induce the Series E Purchasers to purchase shares of Series E Preferred Stock pursuant to the Purchase Agreement by agreeing to the terms and conditions set forth herein.

 

C.                                    The Company the Series D Holders, the Series C Holders, the Series B Holders and the Series A Holders each desire to amend and restate the Prior Rights Agreement to add the Series E Purchasers as parties to this Agreement and make certain other changes.

 

AGREEMENT

 

The parties hereby agree as follows:

 

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A.                                    Amendment of Prior Rights Agreement; Waiver of Right of First Offer. Effective and contingent upon execution of this Agreement by the Company, the holders of at least three-fourths of the shares of Series C Preferred Stock and shares of Series D Preferred Stock, acting together as a separate class on an as-converted basis and the holders of at least two-thirds of the Registrable Securities, as that term is defined in the Prior Rights Agreement, and upon the execution of the Purchase Agreement, the Prior Rights Agreement is hereby amended and restated in its entirety to read as set forth in this Agreement, and the Company, the Series A Holders, the Series B Holders, the Series C Holders and the Series D Holders hereby agree to be bound by the provisions hereof as the sole agreement of the Company, the Series A Holders, the Series B Holders the Series C Holders and the Series D Holders with respect to registration rights of the Company’s securities and certain other rights, as set forth herein. The Series A Holders, the Series B Holders, the Series C Holders and the Series D Holders each hereby waive the right of first offer, including the notice requirements, set forth in Section 2.3 of the Prior Rights Agreement with respect to the issuance of Series E Preferred Stock issuable pursuant to the Purchase Agreement and the shares of Common Stock issuable upon conversion of such Series E Preferred Stock.

 

1.                                      Registration Rights. The Company and the Investors covenant and agree as follows:

 

1.1                               Definitions. For purposes of this Section 1:

 

(a)                                 “Affiliated Fund” means, with respect to a Holder that is a limited liability company or a limited liability partnership, a fund or entity managed by the same manager or managing member or general partner or management company or by an entity controlling, controlled by, or under common control with such manager or managing member or general partner or management company;

 

(b)                                 “Exchange Act” means the Securities Exchange Act of 1934, as amended (and any successor thereto) and the rules and regulations promulgated thereunder;

 

(c)                                  “Excluded Registration” means a registration statement relating solely to the sale of securities of participants in a Company stock plan, a registration relating to a corporate reorganization or transaction under Rule 145 of the Securities Act;

 

(d)                                 “Form S-3” means such form under the Securities Act as in effect on the date hereof or any successor form under the Securities Act that permits significant incorporation by reference of the Company’s subsequent public filings under the Exchange Act;

 

(e)                                  “Holder” means any Investor owning or having the right to acquire Registrable Securities or any assignee thereof in accordance with Section 1.12 of this Agreement;

 

(f)                                   “Major Investor” means any Investor that holds at least 350,000 shares of the Registrable Securities of the Company (subject to adjustment for stock splits, stock dividends, combinations, reclassifications or the like). When determining whether an Investor is

 

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a Major Investor, Registrable Securities held by any general partners, managing members and affiliates of such Investor, including Affiliated Funds, shall be aggregated;

 

(g)                                  “Preferred Stock” means the Company’s Series A Preferred Stock (the “Series A Preferred Stock”), the Company’s Series B Preferred Stock (the “Series B Preferred Stock”), the Company’s Series C Preferred Stock (the “Series C Preferred Stock”) the Company’s Series D Preferred Stock (the “Series D Preferred Stock”) and the Company’s Series E Preferred Stock (the “Series E Preferred Stock”).

 

(h)                                 “Qualified IPO” means a firm commitment underwritten public offering by the Company of shares of its Common Stock prior to or in connection with which all the then-outstanding shares of Preferred Stock are automatically converted into shares of Common Stock pursuant to the Restated Certificate;

 

(i)                                     “Register.” “registered,” and “registration” refer to a registration effected by preparing and filing a registration statement or similar document in compliance with the Securities Act, and the declaration or ordering of effectiveness of such registration statement or document;

 

(j)                                    “Registrable Securities” means (i) the shares of Common Stock issuable or issued upon conversion of the Preferred Stock held by the Holders, and (ii) any other shares of Common Stock of the Company issued as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, the shares listed in (i); excluding, however, in all cases any Registrable Securities sold in a transaction in which the rights under this Agreement are not assigned, or any shares for which registration rights have terminated pursuant to Section 1.15 of this Agreement;

 

(k)                                 The number of shares of “Registrable Securities then outstanding” shall be determined by the number of shares of Common Stock outstanding which are, and the number of shares of Common Stock issuable pursuant to then exercisable or convertible securities which are, Registrable Securities;

 

(1)                                 “Restated Certificate” means the Company’s Sixth Amended and Restated Certificate of Incorporation, as may be amended from time to time.

 

(m)                             “SEC” means the Securities and Exchange Commission; and

 

(n)                                 “Securities Act” means the Securities Act of 1933, as amended (and any successor thereto) and the rules and regulations promulgated thereunder.

 

1.2                               Request for Registration.

 

(a)                                 If, at any time after the earlier of (i) the four-year anniversary of the date hereof, or (ii) six months after the effective date of the Company’s initial public offering, the Company receives a written request from the Holders of a majority of the Registrable Securities then outstanding and from the Holders of three-fourths of the then outstanding shares of Series C

 

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Preferred Stock, shares of Series D Preferred Stock and shares of Series E Preferred Stock, acting together as a separate class on an as-converted basis, (collectively, the “Initiating Holders”), that the Company file a registration statement under the Securities Act covering the registration of Registrable Securities with an anticipated aggregate offering price to the public of at least $15,000,000, then the Company shall, within 20 days after receiving such request, give written notice of such request to all Holders and shall, subject to the limitations of subsection 1.2(b), use all commercially reasonable efforts to cause to be registered under the Securities Act all of the Registrable Securities that each such Holder has requested to be registered by written notice delivered to the Company within 20 days after the mailing of the aforementioned notice by the Company.

 

(b)                                 If the Initiating Holders intend to distribute the Registrable Securities covered by their request by means of an underwriting, they shall so advise the Company as a part of their request and the Company shall include such information in the written notice referred to in subsection 1.2(a). The underwriter will be selected by the Company, which underwriter shall be reasonably acceptable to the holders of a majority of the outstanding shares of the Registrable Securities that are to be included in the underwriting. In such event, the right of any Holder to include his Registrable Securities in such registration shall be conditioned upon such Holder’s participation in such underwriting and the inclusion of such Holder’s Registrable Securities in the underwriting (unless otherwise mutually agreed by a majority of the outstanding shares held by the Initiating Holders and such Holder) to the extent provided herein. The Company and all Holders proposing to distribute their securities through such underwriting shall enter into an underwriting agreement in customary form with the underwriter or underwriters selected for such underwriting. Notwithstanding any other provision of this Section 1.2, if the underwriter advises the Company in good faith that marketing factors require a limitation of the number of shares to be underwritten, then the Company shall so advise all Holders of Registrable Securities which would otherwise be underwritten pursuant hereto, and the number of shares of Registrable Securities that may be included in the underwriting shall be allocated among all participating Holders thereof, including the Initiating Holders, in proportion (as nearly as practicable) to the amount of Registrable Securities of the Company owned by each participating Holder. In no event shall any Registrable Securities be excluded from such underwriting unless all other securities are first excluded from such offering. Any Registrable Securities excluded from or withdrawn from such underwriting shall be withdrawn from registration.

 

(c)                                  Notwithstanding the foregoing, if the Company shall furnish to the Initiating Holders a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors of the Company it would be seriously detrimental to the Company and its stockholders for such registration statement to be filed, the Company shall have the right to defer such filing for a period of not more than 45 days after receipt of the request of the Initiating Holders; provided, however, that the Company may not utilize this right or the similar right set forth in Section 1.4(b)(iii) more than twice in any 12-month period, and provided, further, that the Company shall not register any securities for the account of itself or any other stockholder during such 45-day period (other than in a Qualified IPO or an Excluded Registration).

 

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(d)                                 In addition, the Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to this Section 1.2:

 

(i)                                     If within 30 days of receiving a request pursuant to Section 1.2(a), the Company provides the Initiating Holders notice of the Company’s intent to file a registration statement within 90 days of the date of such request, for a period commencing on the date of such notice and, provided such registration statement is filed within such 90-day period, and ending on the date 180 days after the effective date of such registration statement unless such offering is not the initial public offering of the Company’s securities, in which case, ending on a date 90 days after the effective date of such registration statement; provided that the Company is actively employing in good faith all commercially reasonable efforts to cause such registration statement to become effective; or

 

(ii)                                  If the Initiating Holders propose to dispose of shares of Registrable Securities that may be immediately registered on Form S-3 pursuant to a request made pursuant to Section 1.4 below.

 

1.3                               Company Registration.

 

(a)                                 If (but without any obligation to do so) the Company proposes to register (including for this purpose a registration effected by the Company for stockholders other than the Holders) any of its stock under the Securities Act in connection with the public offering of such securities solely for cash (other than an Excluded Registration), the Company shall, at such time, promptly give each Holder written notice of such registration. Upon the written request of each Holder given within 20 days after mailing of such notice by the Company in accordance with Section 3.5, the Company shall, subject to the provisions of Section 1.8, use all commercially reasonable efforts to cause to be registered under the Securities Act all of the Registrable Securities that each such Holder has requested to be registered if any stock of the Company is registered.

 

(b)                                 The Company shall have the right to terminate or withdraw any registration initiated by it under this Section 1.3 prior to the effectiveness of such registration whether or not any Holder has elected to include securities in such registration. The expenses of such registration shall be borne by the Company, in accordance with Section 1.7 hereof.

 

1.4                               Form S-3 Registration. In case the Company shall receive from any Holder or Holders of the Registrable Securities then outstanding a written request or requests that the Company effect a registration on Form S-3 and any related qualification or compliance with respect to all or a part of the Registrable Securities owned by such Holder or Holders, the Company will:

 

(a)                                 promptly give written notice of the proposed registration, and any related qualification or compliance, to all other Holders; and

 

(b)                                 use all commercially reasonable efforts to effect, as soon as practicable, such registration and all such qualifications and compliances as may be so requested

 

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and as would permit or facilitate the sale and distribution of all or such portion of such Holder’s or Holders’ Registrable Securities as are specified in such request, together with all or such portion of the Registrable Securities of any other Holder or Holders joining in such request as are specified in a written request given within 15 days after receipt of such written notice from the Company; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance, pursuant to this Section 1.4: (i) if Form S-3 is not available for such offering by the Holders; (ii) if the Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) at an aggregate price to the public of less than $1,000,000; (iii)if the Company shall furnish to the Holders a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors of the Company, it would be seriously detrimental to the Company and its stockholders for such registration statement to be filed, the Company shall have the right to defer such filing for a period of not more than 45 days after receipt of the request of the Holder or Holders under this Section 1.4; provided, however, that the Company shall not utilize this right or the similar right set forth in Section 1.2(c) more than twice in any 12-month period; (iv)if the Company has, within the 12-month period preceding the date of such request, already effected two registrations on Form S-3 for the Holders pursuant to this Section 1.4; (v) in any jurisdiction in which the Company would be required to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance unless the Company is already qualified to do business or subject to service of process in that jurisdiction; or (vi) during the period ending 180 days after the effective date of a registration statement subject to Section 1.3.

 

(c)                                  Subject to the foregoing, the Company shall file a registration statement covering the Registrable Securities and other securities so requested to be registered as soon as practicable after receipt of the request or requests of the Holders. Registrations effected pursuant to this Section 1.4 shall not be counted as demands for registration or registrations effected pursuant to Sections 1.2 or 1.3, respectively.

 

1.5                               Obligations of the Company. Whenever required under this Section 1 to effect the registration of any Registrable Securities, the Company shall, as expeditiously as reasonably possible:

 

(a)                                 Prepare and file with the SEC a registration statement with respect to such Registrable Securities and use all commercially reasonable efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration statement effective for up to 120 days, or until the distribution described in such registration statement is completed, if earlier.

 

(b)                                 Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration statement for up to 120 days, or until the distribution described in such registration statement is completed, if earlier.

 

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(c)                                  Promptly notify the Holders of the effectiveness of such registration statement, and furnish to the Holders such numbers of copies of a prospectus, including any supplement to the prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable Securities owned by them.

 

(d)                                 Following the effective date of such registration statement, notify the Holders of any request by the SEC that the Company amend or supplement such registration statement, or the associated prospectus.

 

(e)                                  Use all commercially reasonable efforts to register and qualify the securities covered by such registration statement under such other securities or Blue Sky laws of such jurisdictions as shall be reasonably requested by the Holders, provided that the Company shall not be required in connection therewith or as a condition thereto to qualify to do business or to file a general consent to service of process in any such states or jurisdictions unless the Company is already qualified to do business or subject to service of process in that jurisdiction.

 

(f)                                   In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement, in usual and customary form, with the managing underwriter of such offering. Each Holder and other security holder participating in such underwriting shall also enter into and perform its obligations under such an agreement.

 

(g)                                  Notify each Holder of Registrable Securities covered by such registration statement at any time when a prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the circumstances then existing, such obligation to continue for 120 days or until the distribution described in such registration statement is completed, if earlier.

 

(h)                                 Cause all such Registrable Securities registered pursuant to this Section 1 to be listed on each national securities exchange or trading system on which similar securities issued by the Company are then listed.

 

(i)                                     Provide a transfer agent and registrar for all Registrable Securities registered pursuant hereunder and a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration.

 

(j)                                    Make generally available to its security holders, and to deliver to each Holder participating in the registration statement, an earnings statement of the Company that will satisfy the provisions of Section 11(a) of the Securities Act covering a period of 12 months beginning after the effective date of such registration statement as soon as reasonably practicable after the termination of such 12-month period.

 

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1.6                               Information From Holders. It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Section 1 with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding such Holder, the Registrable Securities held by it, and the intended method of disposition of such securities as shall be required to effect the registration of such Holder’s Registrable Securities. The Company shall have no obligation with respect to any registration requested pursuant to Section 1.2 or Section 1.4 of this Agreement if, as a result of the application of the preceding sentence, the anticipated aggregate offering price of the Registrable Securities to be included in the registration does not equal or exceed the anticipated aggregate offering price required to originally trigger the Company’s obligation to initiate such registration as specified in subsection 1.2(a) or subsection 1.4(b)(ii), whichever is applicable.

 

1.7                               Expenses of Registration. All expenses other than underwriting discounts and commissions incurred in connection with registrations, filings or qualifications pursuant to Sections 1.2, 1.3 and 1.4 including (without limitation) all registration, filing and qualification fees, printers’ and accounting fees, fees and disbursements of counsel for the Company, and the reasonable fees and disbursements of one counsel for the selling Holders selected by them with the approval of the Company, which approval shall not be unreasonably withheld, shall be borne by the Company.

 

1.8                               Underwriting Requirements. In connection with any offering involving an underwriting of shares of the Company’s capital stock, the Company shall not be required under Section 1.3 to include any of the Holders’ securities in such underwriting unless they accept the terms of the underwriting as agreed upon between the Company and the underwriters selected by the Company (or by other persons entitled to select the underwriters), and then only in such quantity as the underwriters determine in their sole discretion will not jeopardize the success of the offering by the Company. If the total amount of securities, including Registrable Securities, requested by stockholders to be included in such offering exceeds the amount of securities sold other than by the Company that the underwriters determine in their sole discretion is compatible with the success of the offering, then the Company shall be required to include in the offering only that number of such securities, including Registrable Securities, which the underwriters determine in their sole discretion will not jeopardize the success of the offering (the securities so included to be apportioned pro rata among the selling stockholders according to the total amount of securities entitled to be included therein owned by each selling stockholder or in such other proportions as shall mutually be agreed to by such selling stockholders) but in no event shall the amount of securities of the selling Holders included in the offering be reduced below 30% of the total amount of securities included in such offering, unless such offering is the initial public offering of the Company’s securities, in which case, the selling stockholders may be excluded if the underwriters make the determination described above and no other stockholder’s securities are included. For purposes of the preceding parenthetical concerning apportionment, for any selling stockholder which is a holder of Registrable Securities and which is a venture capital fund, or a partnership or corporation, the Affiliated Funds, partners, retired partners and stockholders of such holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to be a single “selling stockholder,” and any pro-rata reduction with respect to such “selling stockholder” shall be based upon the aggregate amount of shares carrying registration rights

 

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owned by all entities and individuals included in such “selling stockholder,” as defined in this sentence.

 

1.9                               Delay of Registration. No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any such registration as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 1.

 

1.10                        Indemnification. In the event any Registrable Securities are included in a registration statement under this Section 1:

 

(a)                                 To the extent permitted by law, the Company will indemnify and hold harmless each Holder, any underwriter (as defined in the Securities Act) for such Holder and each person, if any, who controls such Holder or underwriter within the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages, or liabilities (joint or several) to which they may become subject under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or violations (collectively a “Violation”): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state in such registration statement a material fact required to be stated therein, or necessary to make the statements therein not misleading, or (iii) any violation or alleged violation by the Company of the Securities Act, the Exchange Act, any state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any state securities law; and the Company will pay to each such Holder, underwriter or controlling person, as incurred, any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage, liability, or action; provided, however, that the indemnity agreement contained in this subsection 1.10(a) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability, or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld), nor shall the Company be liable to any Holder, underwriter or controlling person for any such loss, claim, damage, liability, or action to the extent that it arises out of or is based upon a Violation which occurs in reliance upon and in conformity with written information furnished expressly for use in connection with such registration by any such Holder, underwriter or controlling person.

 

(b)                                 To the extent permitted by law, each selling Holder will indemnify and hold harmless the Company, each of its directors, each of its officers who has signed the registration statement, each person, if any, who controls the Company within the meaning of the Securities Act, any underwriter, any other Holder selling securities in such registration statement and any controlling person of any such underwriter or other Holder, against any losses, claims, damages, or liabilities (joint or several) to which any of the foregoing persons may become subject, under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon and in conformity with written information furnished by such Holder expressly for use in connection with such registration; and each such Holder will pay, as incurred, any legal or

 

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other expenses reasonably incurred by any person intended to be indemnified pursuant to this subsection 1.10(b), in connection with investigating or defending any such loss, claim, damage, liability, or action; provided, however, that the indemnity agreement contained in this subsection 1.10(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld; provided, that in no event shall any indemnity under this subsection 1.10(b) exceed the net proceeds from the offering received by such Holder, except in the case of willful fraud by such Holder.

 

(c)                                  Promptly after receipt by an indemnified party under this Section 1.10 of notice of the commencement of any action (including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 1.10, deliver to the indemnifying party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an indemnified party (together with all other indemnified parties which may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the reasonable fees and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a reasonable time of the commencement of any such action, if prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party under this Section 1.10, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Section 1.10.

 

(d)                                 If the indemnification provided for in this Section 1.10 is held by a court of competent jurisdiction to be unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to therein, then the indemnifying party, in lieu of indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage, or expense in such proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the statements or omissions that resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable considerations; provided, that in no event shall any contribution by a Holder under this Subsection 1.10(d) exceed the net proceeds from the offering received by such Holder, except in the case of willful fraud by such Holder. The relative fault of the indemnifying party and of the indemnified party shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access to information, and opportunity to correct or prevent such statement or omission.

 

10

 

(e)                                  Notwithstanding the foregoing, to the extent that the provisions on indemnification and contribution contained in the underwriting agreement entered into in connection with the underwritten public offering are in conflict with the foregoing provisions, the provisions in the underwriting agreement shall control.

 

(f)                                   The obligations of the Company and Holders under this Section 1.10 shall survive the completion of any offering of Registrable Securities in a registration statement under this Section 1, and otherwise.

 

1.11                        Reports Under the Exchange Act. With a view to making available to the Holders the benefits of Rule 144 promulgated under the Securities Act and any other rule or regulation of the SEC that may at any time permit a Holder to sell securities of the Company to the public without registration or pursuant to a registration on Form S-3, the Company agrees to:

 

(a)                                 make and keep public information available, as those terms are understood and defined in SEC Rule 144, at all times after 90 days after the effective date of the Qualified IPO so long as the Company remains subject to the periodic reporting requirements under Sections 13 or 15(d) of the Exchange Act;

 

(b)                                 take such action, including the voluntary registration of its Common Stock under Section 12 of the Exchange Act, as is necessary to enable the Holders to utilize Form S-3 for the sale of their Registrable Securities, such action to be taken as soon as practicable after the end of the fiscal year in which the first registration statement filed by the Company for the offering of its securities to the general public is declared effective;

 

(c)                                  file with the SEC in a timely manner all reports and other documents required of the Company under the Securities Act and the Exchange Act; and

 

(d)                                 furnish to any Holder upon request, so long as the Holder owns any Registrable Securities, (i) a written statement by the Company that it has complied with the reporting requirements of SEC Rule 144 (at any time after 90 days after the effective date of the Qualified IPO), the Securities Act and the Exchange Act (at any time after it has become subject to such reporting requirements), or that it qualifies as a registrant whose securities may be resold pursuant to Form S-3 (at any time after it so qualifies), (ii) a copy of the most recent annual or quarterly report of the Company and such other reports and documents so filed by the Company, and (iii) such other information as may be reasonably requested in availing any Holder of any rule or regulation of the SEC which permits the selling of any such securities without registration or pursuant to such form.

 

1.12                        Assignment of Registration Rights. The rights to cause the Company to register Registrable Securities pursuant to this Section 1 may be assigned (but only with all related obligations) to a transferee or assignee (i) that is a partner, retired partner, member, or retired member of any Holder which is a partnership or limited liability company, (ii) that is a family member or trust for the benefit of any individual Holder; (iii) who acquires shares representing at least 10% of the shares of Registrable Securities then outstanding, or (iv) that is an Affiliated Fund, provided that in each case the transferee or assignee holds at least 5% of the

 

11

 

Registrable Securities then outstanding; and provided further that the Company is, promptly after such transfer, furnished with written notice of the name and address of such transferee or assignee and the securities with respect to which such registration rights are being assigned; and provided, further, that such assignment shall be effective only if the transferee agrees in writing to be bound by this Agreement and immediately following such transfer the further disposition of such securities by the transferee or assignee is restricted under the Securities Act. For the purposes of determining the number of shares of Registrable Securities held by a transferee or assignee, the holdings of transferees and assignees of (x) a partnership who are partners or retired partners of such partnership or (y) a limited liability company who are members or retired members of such limited liability company (including family members of such partners or members who acquire Registrable Securities by gift, will or intestate succession) shall be aggregated together and with the partnership or limited liability company.

 

1.13                        Limitations on Subsequent Registration Rights. From and after the date of this Agreement, the Company shall not, without the prior written consent of the Holders of at least two-thirds of the outstanding Registrable Securities, enter into any agreement with any holder or prospective holder of any securities of the Company which would allow such holder or prospective holder (a) to include any of such securities in any registration filed under Section 1.2 hereof, unless under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that the inclusion of his securities will not reduce the amount of the Registrable Securities of the Holders which is included or (b) to make a demand registration which could result in such registration statement being declared effective prior to the earlier of either of the dates set forth in subsection 1.2(a) or within 120 days of the effective date of any registration effected pursuant to Section 1.2.

 

1.14                        Lock-Up Agreement.

 

(a)                                 Lock-Up Period; Agreement. In connection with the initial public offering of the Company’s securities and upon request of the Company or the underwriters managing such offering of the Company’s securities, each Holder agrees not to sell, make any short sale of, loan, grant any option for the purchase of, or otherwise dispose of any securities of the Company, however or whenever acquired (other than those included in the registration) without the prior written consent of the Company or such underwriters, as the case may be, for such period of time (not to exceed 180 days but subject to such extension or extensions as may be required by the underwriters in order to publish research reports while complying with the Rule 2711 of the National Association of Securities Dealers, Inc.) from the effective date of such registration statement as may be requested by the Company or such managing underwriters and to execute an agreement reflecting the foregoing as may be requested by the underwriters at the time of the Company’s initial public offering.

 

(b)                                 Limitations. The obligations described in Section 1.14(a) shall apply only if all officers and directors of the Company and all greater than 1% stockholders enter into similar agreements, and shall not apply to an Excluded Registration.

 

(c)                                  Stop-Transfer Instructions. In order to enforce the foregoing covenants, the Company may impose stop-transfer instructions with respect to the securities of

 

12

 

each Holder (and the securities of every other person subject to the restrictions in Section 1.14(a)).

 

(d)                                 Transferees Bound. Each Holder agrees that it will not transfer securities of the Company unless each transferee agrees in writing to be bound by all of the provisions of this Section 1.14, provided that this Section 1.14(d) shall not apply to transfers pursuant to a registration statement or transfers after the 12-month anniversary of the effective date of the Company’s initial public offering subject to this Section 1.14.

 

(e)                                  Legends. Each Holder agrees that a legend reading substantially as follows shall be placed on all certificates representing all Registrable Securities of each Holder (and the shares or securities of every other person subject to the restriction contained in this Section 1.14):

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO A LOCK-UP PERIOD AS SET FORTH IN AN AGREEMENT BETWEEN THE COMPANY AND THE ORIGINAL HOLDER OF THESE SECURITIES, A COPY OF WHICH MAY BE OBTAINED AT THE ISSUER’S PRINCIPAL OFFICE. SUCH LOCKUP PERIOD IS BINDING ON TRANSFEREES OF THESE SHARES.

 

1.15                        Termination of Registration Rights. No Holder shall be entitled to exercise any right provided for in this Section 1 after the earlier of (i) with respect to any Holder, at such time after the Qualified IPO as Rule 144 or another similar exemption under the Securities Act is available for the sale of all of such Holder’s shares during a three-month period without registration, or (ii) upon termination of this Agreement, as provided in Section 3.1.

 

2.                                      Covenants of the Company.

 

2.1                               Delivery of Financial Statements. The Company shall deliver to each Major Investor:

 

(a)                                 as soon as practicable, but in any event within 120 days after the end of each fiscal year of the Company (or such longer period of time as may be required by the Company’s independent public accountants), an income statement for such fiscal year, a balance sheet of the Company and statement of stockholder’s equity as of the end of such year, and a statement of cash flows for such year, such year-end financial reports to be in reasonable detail, prepared in accordance with generally accepted accounting principles (“GAAP”), and audited and certified by an independent public accounting firm of nationally recognized standing recommended by management and approved by the Board of Directors;

 

(b)                                 as soon as practicable, but in any event within 45 days after the end of each of the first three quarters of each fiscal year of the Company, an unaudited profit or loss statement, a statement of cash flows for such fiscal quarter and an unaudited balance sheet as of the end of such fiscal quarter;

 

13

 

(c)                                  within 30 days of the end of each month, an unaudited income statement and a statement of cash flows and balance sheet for and as of the end of such month, in reasonable detail; and

 

(d)                                 as soon as practicable, but in any event prior to 30 days before the end of each fiscal year, a budget and business plan for the next fiscal year, prepared on a monthly basis, and, as soon as prepared, any other updated or revised budgets for such fiscal year prepared by the Company.

 

2.2                               Inspection. The Company shall permit each Major Investor at such Major Investor’s expense, to visit and inspect the Company’s properties, to examine its books of account and records and to discuss the Company’s affairs, finances and accounts with its officers, all upon reasonable advance notice and at such reasonable times as may be requested by such Major Investor.

 

2.3                               Right of First Offer. Subject to the terms and conditions specified in this Section 2.3, the Company hereby grants to each Major Investor a right of first offer with respect to future sales by the Company of its Shares (as hereinafter defined). For purposes of this Section 2.3, Major Investor includes any general partners, managing members and affiliates of such Major Investor, including Affiliated Funds. A Major Investor who chooses to exercise the right of first offer may designate as purchasers under such right itself or its partners or affiliates, including Affiliated Funds, in such proportions as it deems appropriate.

 

Each time the Company proposes to offer any shares of, or securities, rights to purchase securities or debt convertible into or exercisable for any shares of, any class of its capital stock (“Shares”), the Company shall first make an offering of such Shares to each Major Investor in accordance with the following provisions:

 

(a)                                 The Company shall deliver a notice (the “RFO Notice”) to the Investors stating (i) its bona fide intention to offer such Shares, (ii) the number of such Shares to be offered, and (iii) the price and terms, if any, upon which it proposes to offer such Shares.

 

(b)                                 Within 15 days after delivery of the RFO Notice, each Major Investor may elect to purchase or obtain, at the price and on the terms specified in the RFO Notice, up to that portion of such Shares which equals the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion and exercise of all convertible or exercisable securities then held, by such Major Investor bears to the sum of (i) the total number of shares of Common Stock then outstanding (assuming full conversion and exercise of all convertible or exercisable securities) and (ii) the total number of shares of Common Stock issuable to employees, consultants or directors pursuant to a stock option plan, restricted stock plan, or other stock plan approved by the Board of Directors. Such purchase shall be completed at the same closing as that of any third party purchasers or at an additional closing. The Company shall promptly, in writing, inform each Major Investor that purchases all the shares available to it (each, a “Fully-Exercising Investor”) of any other Major Investor’s failure to do likewise. During the 10-day period commencing after receipt of such information, each Fully-Exercising Investor shall be entitled to obtain that portion of the Shares for which Major Investors were entitled to

 

14

 

subscribe but which were not subscribed for by the Major Investors that is equal to the proportion that the number of shares of Common Stock issued and held, or issuable upon conversion and exercise of all convertible or exercisable securities then held, by such Fully-Exercising Investor bears to the total number of shares of Common Stock held by all Fully-Exercising Investors (assuming full conversion and exercise of all convertible or exercisable securities).

 

(c)                                  The Company may, during the 45-day period following the expiration of the period provided in subsection 2.3(b) hereof, offer the remaining unsubscribed portion of the Shares to any person or persons at a price not less than, and upon terms no more favorable to the offeree than those specified in the RFO Notice. If the Company does not enter into an agreement for the sale of the Shares within such period, or if such agreement is not consummated within 60 days after the execution thereof, the right provided hereunder shall be deemed to be revived and such Shares shall not be offered unless first reoffered to the Major Investors in accordance herewith.

 

(d)                                 The right of first offer in this Section 2.3 shall not be applicable to:

 

(i)                                     Common Stock issued pursuant to stock dividends, stock splits or similar transactions, as described in Section 4(d)(ii) of the Restated Certificate;

 

(ii)                                  up to 1,356,246 shares of Common Stock (plus any additional shares reserved under the Company’s Amended and Restated 2006 Stock Plan (the “Stock Plan”) pursuant to Section 2.7 hereof or such greater number as may be approved by the Board of Directors, including the approval of both Preferred Directors (as defined in Section 5(b) of Article IV(B) of the Restated Certificate)) issued or issuable to employees, officers, consultants or directors of the Company or other persons performing services for the Company pursuant to the Stock Plan;

 

(iii)                               capital stock, or options or warrants to purchase capital stock, issued to financial institutions or lessors in connection with commercial credit arrangements, equipment financings, commercial property lease transactions or similar transactions the terms of which are approved by the Board of Directors;

 

(iv)                              Common Stock or Preferred Stock issuable upon exercise of warrants, notes, or other convertible securities outstanding as of the date of the Restated Certificate;

 

(v)                                 Common Stock issued upon conversion of the Preferred Stock;

 

(vi)                              capital stock issued or issuable to an entity as a component of any business relationship with such entity for the purpose of (A) joint venture, technology licensing or development activities, (B) distribution, supply or manufacture of the Company’s products or services, or (C) any other arrangements involving corporate partners that are primarily for purposes other than raising capital, provided that the terms of such business

 

15

 

relationship with such entity are approved by the Board of Directors, including the approval of at least two Preferred Directors; or

 

(vii)                           Shares of Series E Preferred Stock issued in accordance with the terms of that certain Series E Preferred Stock Purchase Agreement made on or about the date hereof by and among the Company and the purchasers listed on Exhibit A attached thereto, as the same may be amended, restated, supplemented or otherwise modified from time to time.

 

2.4                               Qualified Small Business Stock Status. In the event that the Company proposes to take an action or engage in a transaction that would reasonably be expected to result in the Shares no longer being “qualified small business stock” within the meaning of Section 1202(c) of the Internal Revenue Code of 1986, as amended (the “Code”), the Company shall notify the Major Investors and consult in good faith to devise a mutually agreeable and reasonable alternative course of action or transaction structure that would preserve such status. In addition, the Company shall submit to the Major Investors and to the Internal Revenue Service any reports that may be required under Section 1202(d)(1)(C) of the Code and any related Treasury Regulations. In addition, within ten (10) days after any Major Investor has delivered to the Company a written request therefor, the Company shall deliver to such Major Investor a written statement informing the Major Investor whether, in the Company’s good-faith judgment after a reasonable investigation, such Major Investor’s interest in the Company constitutes “qualified small business stock” as defined in Section 1202(c) of the Code, or would constitute “qualified small business stock,” if determination of whether stock constitutes “qualified small business stock” were made by taking into account the modifications set forth in Section 1045(b)(4) of the Code. The Company’s obligation to furnish a written statement pursuant to this Section 2.4 shall continue notwithstanding the fact that a class of the Company’s stock may be traded on an established securities market.

 

2.5                               Expenses of Board Members. The Company shall pay the reasonable and documented expenses incurred by each Preferred Director in connection with their attendance or participation at a meeting of the Company’s Board of Directors.

 

2.6                               Equity Compensation. Any award of stock options, shares of restricted stock or other awards made by the Company to its employees, directors, officers, consultants, independent contractors or otherwise shall made at the fair market value of the Common Stock on the date of grant as determined in good faith by the Company’s Board of Directors; provided, however, that in the case of stock options meeting the requirements of Section 422 of the Internal Revenue Code of 1986, as amended or replaced from time to time, granted to an owner of stock possessing more than 10% of the total combined voting power of all classes of stock of the Company, the exercise price shall not be less than 110% of the fair market value of the Common Stock.

 

2.7                               Insurance. The Company shall maintain, from financially sound and reputable insurers Directors and Officers liability insurance in an amount and on terms and conditions satisfactory to the Board of Directors and, upon a Liquidation Transaction, obtain “tail coverage” in respect of such policy in an amount and on terms and conditions satisfactory to the Board of Directors.

 

16

 

2.8                               Termination of Covenants.

 

(a)                                 The covenants set forth in Sections 2.1 through Section 2.7 shall terminate as to each Holder and be of no further force or effect (i) immediately prior to the consummation of a Qualified IPO, or (ii) upon termination of this Agreement, as provided in Section 3.1.

 

(b)                                 The covenants set forth in Sections 2.1 and 2.2 shall terminate as to each Holder and be of no further force or effect when the Company first becomes subject to the periodic reporting requirements of Sections 13 or 15(d) of the Exchange Act, if this occurs earlier than the events described in Section 2.8(a) above.

 

3.                                      Miscellaneous.

 

3.1                               Termination. This Agreement shall terminate, and have no further force and effect, when the Company shall consummate a transaction or series of related transactions deemed to be a liquidation, dissolution or winding up of the Company pursuant to the Restated Certificate (including without limitation a Liquidation Transaction, as such term is defined in the Restated Certificate).

 

3.2                               Entire Agreement. This Agreement constitutes the entire agreement between the parties hereto pertaining to the subject matter hereof, and any and all other written or oral agreements relating to the subject matter hereof existing between the parties hereto are expressly canceled.

 

3.3                               Successors and Assigns. Except as otherwise provided in this Agreement, the terms and conditions of this Agreement shall inure to the benefit of and be binding upon the respective permitted successors and assigns of the parties (including transferees of any of the Preferred Stock or any Common Stock issued upon conversion thereof). Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in this Agreement.

 

3.4                               Amendments and Waivers. Any term of this Agreement may be amended or waived only with the written consent of (a) the Company, (b) the Holders of at least three-fourths of the shares of Series C Preferred Stock, shares of Series D Preferred Stock and shares of Series E Preferred Stock acting together as a separate class on an as-converted basis, and (c) the holders of at least two-thirds of the Registrable Securities then outstanding; provided, however, that if such amendment or waiver would adversely affect the rights of a specific series of Preferred Stock in a manner different from the other series of Preferred Stock, then such amendment or waiver shall require the consent of the Investors holding a majority of outstanding shares of such series of Preferred Stock; and any amendment or waiver of the rights granted to the Major Investors in Section 2 above shall require the consent of the Holders of a majority of outstanding shares of the Registrable Securities held by the Major Investors. Notwithstanding the foregoing, this Agreement may be amended with only the written consent of the Company for the sole purpose of including additional holders of Preferred Stock as “Investors” and “Holders.” Any amendment or waiver effected in accordance with this paragraph shall be binding upon each

 

17

 

party to this Agreement, whether or not such party has signed such amendment or waiver, each future holder of all such Registrable Securities, and the Company.

 

3.5                               Notices. Unless otherwise provided, any notice required or permitted by this Agreement shall be in writing and shall be deemed sufficient upon delivery, when delivered personally or by overnight courier or sent by facsimile, or 48 hours after being deposited in the U.S. mail, as certified or registered mail, with postage prepaid, and addressed to the party to be notified at such party’s address or facsimile number as set forth on Exhibit A to the Purchase Agreement (or if such Party is not a party to the Purchase Agreement, at such Party’s address or facsimile number as set forth on the Exhibits hereto), or as subsequently modified by written notice.

 

3.6                               Severability. If one or more provisions of this Agreement are held to be unenforceable under applicable law, such provision shall be excluded from this Agreement, and the balance of this Agreement shall be interpreted as if such provision were so excluded and shall be enforceable in accordance with its terms.

 

3.7                               Governing Law. This Agreement and all acts and transactions pursuant hereto shall be governed, construed and interpreted in accordance with the laws of the State of Delaware, without giving effect to principles of conflicts of laws.

 

3.8                               Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument. Facsimile, .pdf or other execution and delivery of this Agreement is legal, valid and binding for all purposes.

 

3.9                               Titles and Subtitles. The titles and subtitles used in this Agreement are used for convenience only and are not to be considered in construing or interpreting this Agreement.

 

3.10                        Aggregation of Stock. All shares of the Preferred Stock held or acquired by affiliated entities or persons shall be aggregated together for the purpose of determining the availability of any rights under this Agreement.

 

[Signature Pages Follow]

 

18

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

	
 
    	
COMPANY
    
	
 
    	
 
    	
 
    
	
 
    	
SURGIQUEST, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Kourosh Azarbarzin
    
	
 
    	
Name:
    	
Kourosh   Azarbarzin
    
	
 
    	
Title:
    	
President and   Chief Executive Officer
    

 

 

	
 
    	
Company   Address: 
    	
333 Quarry Road
    
	
 
    	
 
    	
Milford, CT 0646
    
	
 
    	
 
    	
 
    
	
 
    	
Fax Number:   (203) 799-2401
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
Aphelion   Medical Fund, L.P.
    
	
 
    	
By: Aphelion Capital, LLC, its General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Ned Scheetz
    
	
 
    	
Name: Ned   Scheetz
    
	
 
    	
Title: Managing   Director
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

	
 
    	
Presidio   Partnership 2014, L.P.
    
	
 
    	
By: Presidio Partners 2014 GP, LLC its General   Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ David J.   Collier, MD
    
	
 
    	
Name: David J.   Collier, MD
    
	
 
    	
Title: Manager
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
/s/ Charles   Crocker
    
	
 
    	
Charles Crocker
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Crocker   2004 Charitable Remainder Unitrust
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Charles   Crocker, Trustee
    
	
 
    	
Name: Charles   Crocker
    
	
 
    	
Title: Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Trust   Fund B F/B/O Charles Crocker
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Charles   Crocker, Trustee
    
	
 
    	
Name: Charles   Crocker
    
	
 
    	
Title: Trustee
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
CALIFORNIA   TECHNOLOGY PARTNERS II, LP
    
	
 
    	
 
    	
 
    
	
 
    	
By:  California Technology Ventures II, LLC
    
	
 
    	
Its:  General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ William A.   Hanna
    
	
 
    	
Name:
    	
William A. Hanna
    
	
 
    	
Title:
    	
Managing   Director
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
/s/ Peter Wies
    
	
 
    	
Peter Wies
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
River   Cities Capital Fund IV, L.P.
    
	
 
    	
By:   River Cities Management IV, LLC
    
	
 
    	
Its:   General Partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ J. Carter   McNabb
    
	
 
    	
By: J. Carter   McNabb
    
	
 
    	
Its: Manager
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
River   Cities Capital Fund IV (NQP), L.P.
    
	
 
    	
By:   River Cities Management IV, LLC
    
	
 
    	
Its:   General Partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ J. Carter   McNabb
    
	
 
    	
By: J. Carter   McNabb
    
	
 
    	
Its: Manager
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
Fletcher   Spaght Ventures II, L.P.
    
	
 
    	
By:Fletcher   Spaght Associates II, L.P.,
    
	
 
    	
its   General Partner
    
	
 
    	
By:FSA   II, LLC, its General Partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Linda Tufts
    
	
 
    	
By: Linda Tufts
    
	
 
    	
Its: Managing   Member
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FSV   II, L.P.
    
	
 
    	
By:Fletcher   Spaght Associates II, L.P.,
    
	
 
    	
its   General Partner
    
	
 
    	
By:FSA   II, LLC, its General Partner
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Linda Tufts
    
	
 
    	
By: Linda Tufts
    
	
 
    	
Its: Managing   Member
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
FSV   II-B, L.P.
    
	
 
    	
By:Fletcher   Spaght Associates II-B, LLC,
    
	
 
    	
its   General Partner
    
	
 
    	
By:FSA   II, LLC, its Manager
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
/s/ Linda Tufts
    
	
 
    	
By: Linda Tufts
    
	
 
    	
Its: Managing   Member
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
/s/ Joseph DeVivo
    
	
 
    	
Joseph   DeVivo
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
MOSAIX   VENTURES, LP
    
	
 
    	
By:
    	
MOSAIX VENTURES   MANAGEMENT, LLC
    
	
 
    	
Its:
    	
General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Ranjan Lal
    
	
 
    	
 
    	
Ranjan Lal,   Managing Partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
MOSAIX   VENTURES LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Ranjan Lal
    
	
 
    	
 
    	
Ranjan Lal, Member
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

The parties have executed this Fourth Amended and Restated Investors’ Rights Agreement as of the date first above written.

 

 

	
 
    	
MERRY   MEDICAL LLC
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ George Abi-Chahine
    
	
 
    	
Name:
    	
George   Abi-Chahine
    
	
 
    	
Title:
    	
Chairman &   CEO
    

 

SIGNATURE PAGE TO FOURTH AMENDED AND RESTATED

INVESTORS’ RIGHTS AGREEMENT

 

 

EXHIBIT A

 

SERIES A HOLDERS

 

Name

 

Aphelion Medical Fund

 

Presidio Partners 2014, L.P.

 

Mosaix Ventures LP

 

Charles Crocker

 

Crocker 2004 Charitable Remainder Unitrust

1 Post Street, Room 2515

San Francisco, CA 94104

Attn: Charles Crocker

Email: ccrocker@ccapital.us

 

California Technology Partners II, LP

 

Peter Wiest

 

 

EXHIBIT B

 

SERIES B HOLDERS

 

Name

 

Aphelion Medical Fund

 

Presidio Partners 2014, L.P.

 

Mosaix Ventures LP

 

Charles Crocker

 

Crocker 2004 Charitable Remainder Unitrust

 

Trust Fund B F/B/O Charles Crocker

 

California Technology Partners II, LP

 

Joseph DeVivo

 

Peter Wiest

 

 

EXHIBIT C

 

SERIES C HOLDERS

 

Name

 

Aphelion Medical Fund

 

Presidio Partners 2014, L.P.

 

Mosaix Ventures LP

 

Charles Crocker

 

Crocker 2004 Charitable Remainder Unitrust

 

Trust Fund B F/B/O Charles Crocker

 

California Technology Partners II, LP

 

Joseph DeVivo

 

Peter Wiest

 

River Cities Capital Fund IV, L.P.

 

River Cities Capital Fund IV (NQP), L.P.

 

Fletcher Spaght Ventures II, L.P.

 

FSV II, L.P.

 

FSV II-B, L.P.

 

 

EXHIBIT D

 

SERIES D HOLDERS

 

Name

 

Aphelion Medical Fund

 

Presidio Partners 2014, L.P.

 

Mosaix Ventures LLC

 

Mosaix Ventures LP

 

Charles Crocker

 

California Technology Partners II, LP

 

Joseph DeVivo

 

Peter Wiest

 

River Cities Capital Fund IV, L.P.

 

River Cities Capital Fund IV (NQP), L.P.

 

Fletcher Spaght Ventures II, L.P.

 

FSV II, L.P.

 

FSV II-B, L.P.

 

 

EXHIBIT E

 

SERIES E PURCHASERS

 

Aphelion Medical Fund

 

Presidio Partners 2014, L.P.

 

Merry Medical LLC

 

Mosaix Ventures LP

 

Mosaix Ventures LLC

 

Charles Crocker

 

California Technology Partners II, LP

 

Joseph DeVivo

 

Peter Wiest

 

River Cities Capital Fund IV, L.P.

 

River Cities Capital Fund IV (NQP), L.P.

 

Fletcher Spaght Ventures II, L.P.

 

FSV II, L.P.

 

FSV II-B, L.P.Exhibit 4.3

 

EXECUTION COPY

 

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 BELOW, MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

 

WARRANT TO PURCHASE STOCK

 

Company: SurgiQuest, Inc.

Number of Shares: As set forth below

Class of Stock: Series A Preferred Stock, $0.001 par value

Warrant Price: $2.01 per Share, subject to adjustment

Issue Date: April 9 , 2007

Expiration Date: April 9 , 2017

	
Credit Facility:
    	
This Warrant is   issued in connection with that certain Loan and Security Agreement of even   date herewith between Silicon Valley Bank and the Company (the “Loan   Agreement”).
    

 

THIS WARRANT CERTIFIES THAT, for good and valuable consideration, SILICON VALLEY BANK (Silicon Valley Bank, together with any successor or permitted assignee or transferee of this Warrant or of any shares issued upon exercise hereof, is referred to hereinafter as “Holder”) is entitled upon surrender of this Warrant and a duly executed Notice of Exercise in substantially the form attached hereto as Appendix 1 (the “Notice of Exercise”), at the principal office of the above-named company (the “Company”) located at 12 Cascade Boulevard, Orange, Connecticut 06477, or such other office as the Company shall notify the Holder of in writing, to purchase from the Company up to such number of fully paid and non-assessable shares (the “Shares”) of the Company’s Series A Preferred Stock, $0.001 par value per share (the “Class”) set forth herein, at a purchase price per Share of $2.01 (the “Warrant Price”). This Warrant may be exercised in whole or in part at any time and from time to time until 5:00 PM, Eastern time, on the Expiration Date set forth above, and shall be void thereafter. Until such time as this Warrant is exercised in full or expires, the Warrant Price and the number of Shares are subject to adjustment from time to time as hereinafter provided.

 

This Warrant shall be exercisable for the Initial Shares plus the Additional Shares, if any (collectively, the “Shares”). As used herein:

 

“Initial Shares” means thirty-three thousand five-hundred eighty-two (33,582) Shares of the Class.

 

“Additional Shares” means a cumulative aggregate number of Shares of the Class equal to (a) (i) 2.5%, multiplied by (ii) the amount of each Growth Capital Advance (as defined in the Loan Agreement) made to the Company pursuant to the Loan

 

 

Agreement, divided by (b) the Warrant Price in effect on and as of the date on which such Advance is made.

 

ARTICLE 1. EXERCISE.

 

1.1          Method of Exercise. Holder may exercise this Warrant by delivering the original of this Warrant together with a duly executed Notice of Exercise in substantially the form attached as Appendix 1 to the principal office of the Company, and, if requested by the Company, a joinder to any shareholders agreement into which all holders of other shares of the same series and class as the Shares are bound. Unless Holder is exercising the conversion right set forth in Article 1.2, Holder shall also deliver to the Company a check, wire transfer (to an account designated by the Company), or other form of payment acceptable to the Company for the aggregate Warrant Price for the Shares being purchased.

 

1.2          Conversion Right. In lieu of exercising this Warrant as specified in Article 1.1, Holder may from time to time convert this Warrant, in whole or in part, into a number of Shares determined by dividing (a) the aggregate fair market value of the Shares or other securities otherwise issuable upon exercise of this Warrant minus the aggregate Warrant Price of such Shares by (b) the fair market value of one Share. The fair market value of the Shares shall be determined pursuant to Article 1.3.

 

1.3          Fair Market Value. If the Company’s common stock is traded in a public market and the Shares are common stock, the fair market value of a Share shall be the closing price of a share of common stock reported for the business day immediately before Holder delivers this Warrant together with its Notice of Exercise to the Company (or in the instance where the Warrant is exercised immediately prior to the effectiveness of the Company’s initial public offering (“IPO”), the “price to public” per share price specified in the final prospectus relating to such offering). If the Company’s common stock is traded in a public market and the Shares are preferred stock, the fair market value of a Share shall be the closing price of a share of the Company’s common stock reported for the business day immediately before Holder delivers this Warrant together with its Notice of Exercise to the Company (or, in the instance where the Warrant is exercised immediately prior to the effectiveness of the Company’s initial public offering, the initial “price to public” per share price specified in the final prospectus relating to such offering), in both cases, multiplied by the number of shares of the Company’s common stock into which a Share is convertible. If the Company’s common stock is not traded in a public market, the Board of Directors of the Company shall determine fair market value in its reasonable good faith judgment.

 

1.4          Delivery of Certificate and New Warrant. Promptly after Holder exercises or converts this Warrant and, if applicable, the Company receives payment of the aggregate Warrant Price, the Company shall deliver to Holder certificates for the Shares acquired and, if this Warrant has not been fully exercised or converted and has not expired, a new Warrant representing the Shares not so acquired.

 

1.5          Replacement of Warrants. On receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of this Warrant and, in the case of loss, theft or destruction, on delivery of an indemnity agreement reasonably satisfactory in form and amount to the Company or, in the case of mutilation,

 

 

on surrender and cancellation of this Warrant, the Company shall execute and deliver, in lieu of this Warrant, a new warrant of like tenor.

 

1.6          Treatment of Warrant Upon Acquisition of Company.

 

1.6.1       “Acquisition”. For the purpose of this Warrant, “Acquisition” means any sale, license, or other disposition of all or substantially all of the assets of the Company, or any reorganization, consolidation, merger or sale of outstanding capital stock of the Company where the holders of the Company’s securities before the transaction beneficially own less than a majority of the outstanding voting securities of the surviving entity after the transaction (other than sales of the Company’s securities in transactions solely for capital raising purposes).

 

1.6.2       Treatment of Warrant at Acquisition.

 

A)            Upon the written request of the Company, Holder agrees that, in the event of an Acquisition in which the sole consideration is cash, either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will expire upon the consummation of such Acquisition. The Company shall provide the Holder with written notice of its request relating to the foregoing (together with such reasonable information as the Holder may request in connection with such contemplated Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the closing of the proposed Acquisition.

 

B)            Upon the written request of the Company, Holder agrees that, in the event of an Acquisition that is an “arms length” sale of all or substantially all of the Company’s assets (and only its assets) to a third party that is not an Affiliate (as defined below) of the Company (a “True Asset Sale”), either (a) Holder shall exercise its conversion or purchase right under this Warrant and such exercise will be deemed effective immediately prior to the consummation of such Acquisition or (b) if Holder elects not to exercise the Warrant, this Warrant will continue until the Expiration Date if the Company continues as a going concern following the closing of any such True Asset Sale. The Company shall provide the Holder with written notice of its request relating to the foregoing (together with such reasonable information as the Holder may request in connection with such contemplated Acquisition giving rise to such notice), which is to be delivered to Holder not less than ten (10) days prior to the closing of the proposed Acquisition.

 

C)            Upon the closing of any Acquisition other than those particularly described in subsections 1.6.2 (A), (B) and (D), the Company shall seek to have the successor entity assume the obligations of this Warrant, and in such case this Warrant shall be exercisable for the same securities, cash, and property as would be payable for the Shares issuable upon exercise of the unexercised portion of this Warrant as if such Shares were outstanding on the record date for the Acquisition and subsequent closing. The Warrant Price and/or number of Shares shall be adjusted accordingly. Notwithstanding the foregoing, the Company may elect to purchase the unexercised portion of this Warrant for cash for an amount equal to (a) the greater of (i) the aggregate fair market value of any consideration that would have been received by Holder in consideration for the Shares had Holder exercised the unexercised portion of

 

 

this Warrant immediately before the record date for determining the shareholders entitled to participate in the proceeds of the Acquisition, and (ii) two (2) times the aggregate Warrant Price of the Shares, less (b) the aggregate Warrant Price of the Shares.

 

D)            Notwithstanding the provisions of Section 1.6.2(C), in the event that the acquirer in an Acquisition does not agree to assume this Warrant at and as of the closing thereof, this Warrant, to the extent not exercised or converted on or prior to such closing, shall terminate and be of no further force or effect as of immediately following such closing if all of the following conditions are met: (i) the acquirer is subject to the reporting requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), (ii) the class of stock or other security of the acquirer that would be received by Holder in connection with such Acquisition were Holder to exercise or convert this Warrant on or prior to the closing thereof is listed for trading on a national securities exchange or approved for quotation on an automated inter-dealer quotation system, and (iii) Holder would be able to publicly resell all of the acquirer stock and/or other securities that would be received by Holder in such Acquisition were Holder to exercise or convert this Warrant on or prior to the closing of such Acquisition during the three (3) month period immediately following the closing thereof pursuant to an effective registration statement covering such acquirer stock and/or other securities or pursuant to the provisions of Rule 144 promulgated under the Act.

 

As used herein “Affiliate” shall mean any person or entity that owns or controls directly or indirectly ten percent (10%) or more of the stock of Company, any person or entity that controls or is controlled by or is under common control with such persons or entities, and each of such person’s or entity’s officers, directors, joint venturers or partners, as applicable.

 

ARTICLE 2. ADJUSTMENTS TO THE SHARES.

 

2.1          Stock Dividends, Splits, Etc. If the Company declares or pays a dividend on the outstanding shares of the Class payable in common stock or other securities, then upon exercise of this Warrant, for each Share acquired, Holder shall receive, without cost to Holder, the total number and kind of securities to which Holder would have been entitled had Holder owned the Shares of record as of the date the dividend occurred. If the Company subdivides the outstanding shares of the Class by reclassification or otherwise into a greater number of shares or takes any other action which increase the amount of common stock into which the one share of the Class is convertible, the number of Shares purchasable hereunder shall be proportionately increased and the Warrant Price shall be proportionately decreased. If the outstanding shares of the Class are combined or consolidated, by reclassification or otherwise, into a lesser number of shares, the Warrant Price shall be proportionately increased and the number of Shares shall be proportionately decreased.

 

2.2          Reclassification, Exchange, Combinations or Substitution. Upon any reclassification, exchange, substitution, or other event that results in a change of the number and/or class of the securities issuable upon exercise or conversion of this Warrant, Holder shall be entitled to receive, upon exercise or conversion of this Warrant, the number and kind of securities and property that Holder would have received for the Shares if this Warrant had been exercised immediately before such reclassification, exchange, substitution, or other event. Such an event shall include, without limitation,

 

 

any automatic conversion of the outstanding or issuable securities of the Company of the same class or series as the Shares to common stock pursuant to the terms of the Company’s Articles or Certificate (as applicable) of Incorporation upon the closing of the IPO. The Company or its successor shall promptly issue to Holder an amendment to this Warrant setting forth the number and kind of such new securities or other property issuable upon exercise or conversion of this Warrant as a result of such reclassification, exchange, substitution or other event that results in a change of the number and/or class of securities issuable upon exercise or conversion of this Warrant. The amendment to this Warrant shall provide for adjustments which shall be as nearly equivalent as may be practicable to the adjustments provided for in this Article 2 including, without limitation, adjustments to the Warrant Price and to the number of securities or property issuable upon exercise of the new Warrant. The provisions of this Article 2.2 shall similarly apply to successive reclassifications, exchanges, substitutions, or other events.

 

2.3          Adjustments for Diluting Issuances. The number of shares of common stock issuable upon conversion of the Shares shall be subject to adjustment, from time to time in the manner set forth in the Company’s Articles or Certificate of Incorporation as if the Shares were issued and outstanding on and as of the date of any such required adjustment. The provisions set forth for the Shares in the Company’s Articles or Certificate (as applicable) of Incorporation relating to the above in effect as of the Issue Date may not be amended, modified or waived, without the prior written consent of Holder unless such amendment, modification or waiver affects the rights associated with the Shares in the same manner as such amendment, modification or waiver affects the rights associated with all other shares of the same series and class as the Shares granted to the Holder.

 

2.4          No Impairment. The Company shall not, by amendment of its Articles or Certificate (as applicable) of Incorporation or through a reorganization, transfer of assets, consolidation, merger, dissolution, issue, or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed under this Warrant by the Company, but shall at all times in good faith assist in carrying out of all the provisions of this Article 2 and in taking all such action as may be necessary or appropriate to protect Holder’s rights under this Article against impairment.

 

2.5          Fractional Shares. No fractional Shares shall be issuable upon exercise or conversion of the Warrant and the number of Shares to be issued shall be rounded down to the nearest whole Share. If a fractional share interest arises upon any exercise or conversion of the Warrant, the Company shall eliminate such fractional share interest by paying Holder the amount computed by multiplying the fractional interest by the fair market value of a full Share.

 

2.6          Certificate as to Adjustments. Upon each adjustment of the Warrant Price, Class and/or number of Shares, the Company shall promptly notify Holder in writing, and, at the Company’s expense, promptly compute such adjustment, and furnish Holder with a certificate of its Chief Financial Officer setting forth such adjustment and the facts upon which such adjustment is based. The Company shall, upon written request, furnish Holder a certificate setting forth the Warrant Price, Class and number of Shares in effect upon the date thereof and the series of adjustments leading to such Warrant Price, Class and number of Shares.

 

 

ARTICLE 3. REPRESENTATIONS AND COVENANTS OF THE COMPANY.

 

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

 

(a)           The initial Warrant Price referenced on the first page of this Warrant is not greater than the price per share at which shares of the same class and series as the Shares were last issued in an arms-length transaction in which at least $500,000 of such shares were sold.

 

(b)           All Shares which may be issued upon the exercise of the purchase right represented by this Warrant, and all securities, if any, issuable upon conversion of the Shares, shall, upon issuance, be duly authorized, validly issued, fully paid and nonassessable, and free of any liens and encumbrances except for restrictions on transfer provided for herein or under applicable federal and state securities laws.

 

(c)           The Company’s capitalization table attached hereto as Schedule 1 is true and complete as of the Issue Date.

 

3.2          Notice of Certain Events. If the Company proposes at any time (a) to declare any dividend or distribution upon the outstanding shares of the same class and series as the Shares, whether in cash, property, stock, or other securities and whether or not a regular cash dividend; (b) to offer for subscription or sale pro rata to the holders of the outstanding shares of the same class and series as the Shares any additional shares of any class or series of the Company’s stock; (c) to effect any reclassification, reorganization or recapitalization of any of its stock; (d) to effect an Acquisition or to liquidate, dissolve or wind up; or (e) offer holders of registration rights the opportunity to participate in an underwritten public offering of the company’s securities for cash, then, in connection with each such event, the Company shall give Holder: (1) at least 10 days prior written notice of the date on which a record will be taken for such dividend, distribution, or subscription rights (and specifying the date on which the holders of shares of the same class and series as the Shares will be entitled thereto) or for determining rights to vote, if any, in respect of the matters referred to in (c) and (d) above; (2) in the case of the matters referred to in (c) and (d) above at least 10 days prior written notice of the date when the same will take place (and specifying the date on which the holders of shares of the same class and series as the Shares will be entitled to exchange their shares for the securities or other property deliverable upon the occurrence of such event); and (3) in the case of the matter referred to in (e) above, the same notice as is given to the holders of such registration rights.

 

3.3             Registration Under Securities Act of 1933, as amended. The Company agrees that the Shares or, if the Shares are convertible into common stock of the Company, such common stock, shall have certain incidental, or “Piggyback,” and S-3 registration rights pursuant to and as set forth in the Company’s Investor Rights Agreement or similar agreement. The provisions set forth in the Company’s Investor Rights Agreement or similar agreement relating to the above in effect as of the Issue Date may not be amended, modified or waived without the prior written consent of Holder unless such amendment, modification or waiver affects the rights associated with the Shares in the same manner as such amendment, modification, or waiver affects the rights associated with all other shares of the same series and class as the Shares granted to the Holder.

 

 

3.4             No Shareholder Rights. Except as provided in this Warrant, Holder will not have any rights as a shareholder of the Company until the exercise of this Warrant.

 

3.5             Certain Information. The Company agrees to provide Holder at any time and from time to time with such information as Holder may reasonably request for purposes of Holder’s compliance with regulatory, accounting and reporting requirements applicable to Holder.

 

ARTICLE 4. REPRESENTATIONS, WARRANTIES OF THE HOLDER. The Holder represents and warrants to the Company as follows:

 

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

 

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

 

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

 

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

 

4.5          The Act. Holder understands that this Warrant and the Shares issuable upon exercise or conversion hereof have not been registered under the Act in reliance upon a specific exemption therefrom, which exemption depends upon, among other things, the bona fide nature of the Holder’s investment intent as expressed herein. Holder understands that this Warrant and the Shares issued upon any exercise or conversion hereof must be held indefinitely unless subsequently registered under the 1933 Act and qualified under applicable state securities laws, or unless exemption from such registration and qualification are otherwise available.

 

 

ARTICLE 5. MISCELLANEOUS.

 

5.1          Term: This Warrant is exercisable in whole or in part at any time and from time to time on or before the Expiration Date.

 

5.2          Legends. This Warrant and the Shares (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) shall be imprinted with a legend in substantially the following form:

 

THIS WARRANT AND THE SHARES ISSUABLE HEREUNDER HAVE NOT BEEN REGISTERED UNDER THE ACT, OR THE SECURITIES LAWS OF ANY STATE AND, EXCEPT AND PURSUANT TO THE PROVISIONS OF ARTICLE 5 OF THAT CERTAIN WARRANT TO PURCHASE STOCK ISSUED BY THE COMPANY TO SILICON VALLEY BANK DATED AS OF APRIL 9, 2007 MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER SAID ACT AND APPLICABLE STATE SECURITIES LAW OR, IN THE OPINION OF LEGAL COUNSEL IN FORM AND SUBSTANCE SATISFACTORY TO THE ISSUER OF THESE SECURITIES, SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS EXEMPT FROM REGISTRATION.

 

and such other legends as the Company reasonably deems appropriate.

 

5.3          Compliance with Securities Laws on Transfer. This Warrant and the Shares issuable upon exercise of this Warrant (and the securities issuable, directly or indirectly, upon conversion of the Shares, if any) may not be transferred or assigned in whole or in part without compliance with applicable federal and state securities laws by the transferor and the transferee (including, without limitation, the delivery of investment representation letters and legal opinions reasonably satisfactory to the Company, as reasonably requested by the Company). The Company shall not require Holder to provide an opinion of counsel if the transfer is to SVB Financial Group (Holder’s parent company) or any other affiliate of Holder, provided that any such transferee is an “accredited investor” as defined in Regulation D promulgated under the Act and in the case of a transfer of Shares, if requested by the Company, such transferred executes a joinder to any shareholders agreement into which all holders of other shares of the same series and class as the Shares are bound.

 

5.4          Transfer Procedure. After receipt by Silicon Valley Bank (“Bank”) of the executed Warrant, Bank will transfer all of this Warrant to SVB Financial Group, Holder’s parent company, by execution of an Assignment substantially in the form of Appendix 2. Subject to the provisions of Article 5.3 and upon providing the Company with written notice, SVB Financial Group and any subsequent Holder may transfer all or part of this Warrant or the Shares issuable upon exercise of this Warrant (or the Shares issuable directly or indirectly, upon conversion of the Shares, if any) to any transferee, provided, however, in connection with any such transfer, SVB Financial Group or any subsequent Holder will give the Company notice of the portion of the Warrant being transferred with the name, address and taxpayer identification number of the transferee and Holder will surrender this Warrant to the Company for reissuance to the transferee(s) (and Holder if applicable). The Company may refuse to transfer this

 

 

Warrant or the Shares to any person who directly competes with the Company, or, if requested to do so by the Company, fails to enter into any shareholders agreement into which all holders of other shares of the same series and class as the Shares granted to the Holder are bound, unless, in either case, the stock of the Company is publicly traded.

 

5.5          Notices. All notices and other communications from the Company to the Holder, or vice versa, shall be deemed delivered and effective when given personally or mailed by first-class registered or certified mail, postage prepaid, at such address as may have been furnished to the Company or Holder, as the case may (or on the first business day after transmission by facsimile) be, in writing by the Company or such holder from time to time. All notices to Holder shall be addressed as follows until the Company receives notice of a change of address in connection with a transfer or otherwise:

 

SVB Financial Group

Attn: Treasury Department

3003 Tasman Drive, HA 200

Santa Clara, CA 95054

Telephone: 408-654-7400

Facsimile: 408-496-2405

 

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

 

SurgiQuest, Inc.

Attn: Kurt Azarbarzin, CEO

12 Cascade Boulevard

Orange, Connecticut 06477

Telephone: 203-799-2400 x200

Facsimile: 203-799-2401

 

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

 

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

 

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

 

 

5.9          Counterparts. This Warrant may be executed in counterparts, all of which together shall constitute one and the same agreement.

 

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

 

 

	
“COMPANY”
    	
 
    
	
 
    	
 
    
	
SURGIQUEST, INC.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Kourosh Azarbarzin
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Kourosh Azarbarzin
    	
 
    
	
 
    	
(Print)
    	
 
    
	
Title:
    	
President
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
“HOLDER”
    	
 
    
	
 
    	
 
    
	
SILICON VALLEY BANK
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Clark Hayes
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Clark Hayes
    	
 
    
	
 
    	
(Print)
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
R.M. Relationship   Manager
    	
 
    

 

 

APPENDIX 1

 

NOTICE OF EXERCISE

 

1.             Holder elects to purchase                          shares of the Series A Preferred Stock of                                          pursuant to the terms of the attached Warrant, and tenders payment of the purchase price of the shares in full.

 

[or]

 

1.             Holder elects to convert the attached Warrant into Shares in the manner specified in the Warrant. This conversion is exercised for                                                     of the Shares covered by the Warrant.

 

[Strike paragraph that does not apply.]

 

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

 

 

	
 
    	
 
    	
 
    
	
 
    	
Holders Name
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
(Address)
    	
 
    

 

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

 

 

 

 

	
 
    	
HOLDER:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
(Date):
    	
 
    

 

 

APPENDIX 2

 

ASSIGNMENT

 

For value received, Silicon Valley Bank hereby sells, assigns and transfers unto

 

	
Name:
    	
SVB   Financial Group
    
	
Address:
    	
3003   Tasman Drive (HA-200)
    
	
 
    	
Santa   Clara, CA 95054
    
	
 
    	
 
    
	
Tax   ID:
    	
91-1962278
    

 

 

that certain Warrant to Purchase Stock issued by                               . (the “Company”), on                                               [insert Issue Date] (the “Warrant”) together with all rights, title and interest therein.

 

 

	
 
    	
 
    	
SILICON VALLEY BANK
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Assignment Date:
    	
 
    	
 
    	
 
    
					

 

 

By its execution below, and for the benefit of the Company, SVB Financial Group makes each of the representations and warranties set forth in Article 4 of the Warrant as of the date hereof and agrees to be bound by all of the terms and conditions set forth in the Warrant as the “Holder” thereof.

 

	
 
    	
 
    	
SVB FINANCIAL   GROUP
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
Title:

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00251-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00251-of-00352.parquet"}]]