Document:

Exhibit 4.2

 

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

 

	
Warrant   No. [                 ]
    	
 
    	
Date of   Issuance:
    

 

AVEXIS, INC.

 

Class B-2 Common Stock Warrant

 

AveXis, Inc. (the “Company”), for value received, hereby certifies that PBM Capital Investments, LLC, or its assigns (the “Registered Holder”), is entitled at any time from and after the Date of Issuance, subject to the terms set forth below, to purchase from the Company, at any time after the date hereof and on or before the Expiration Date (as defined in Section 7 below), shares of the Company’s Class B-2 Common Stock, $0.0001 par value per share (the “Class B-2 Common Stock”) at an exercise price per share equal to $3.55. The shares purchasable upon exercise of this Warrant and the purchase price per share, as adjusted from time to time pursuant to the provisions of this Warrant, are hereinafter referred to as the “Warrant Stock” and the “Purchase Price”, respectively.

 

This Warrant (the “Warrant”) is issued pursuant to and subject to the terms and conditions of the Class B Common Stock Purchase Agreement, among the Company and the Registered Holder, of even date herewith (the “Purchase Agreement”).

 

1.                                      Number of Warrant Shares. Subject to the terms and conditions hereinafter set forth, the Registered Holder is entitled, upon surrender of this Warrant, to purchase from the Company 118,318 shares (subject to adjustment as provided herein) of Warrant Stock.

 

2.                                      Exercise.

 

(a)                                 Manner of Exercise. This Warrant may be exercised by the Registered Holder, in whole or in part, by surrendering this Warrant, with the purchase/exercise form appended hereto as Exhibit A duly executed by such Registered Holder or by such Registered Holder’s duly authorized attorney, at the principal office of the Company, or at such other office or agency as the Company may designate, accompanied by payment in full of the Purchase Price payable in respect of the number of shares of Warrant Stock purchased upon such exercise. The Purchase Price may be paid by cash, check or wire transfer.

 

(b)                                 Effective Time of Exercise. Each exercise of this Warrant shall be deemed to have been effected immediately prior to the close of business on the day on which this Warrant shall have been surrendered to the Company as provided in Section 2(a) above. At such time, the person or persons in whose name or names any certificates for Warrant Stock shall be issuable upon such exercise as provided in Section 2(c) below shall be deemed to have become the holder or holders of record of the Warrant Stock represented by such certificates.

 

1

 

(c)                                  Delivery to Registered Holder. As soon as practicable after the exercise of this Warrant in whole or in part, and in any event within ten (10) business days thereafter, the Company at its expense will cause to be issued in the name of, and delivered to, the Registered Holder, or as such Registered Holder (upon payment by such Registered Holder of any applicable transfer taxes) may direct:

 

(i)                                     a certificate or certificates for the number of shares of Warrant Stock to which such Registered Holder shall be entitled; and

 

(ii)                                  in case such exercise is in part only, a new warrant or warrants (dated the date hereof) of like tenor, calling in the aggregate on the face or faces thereof for the number of shares of Warrant Stock equal (without giving effect to any adjustment therein) to the number of such shares called for on the face of this Warrant minus the number of such shares purchased by the Registered Holder upon such exercise as provided in Section 2(a) above.

 

3.                                      Adjustments.

 

(a)                                 Stock Splits and Dividends. If outstanding shares of the Company’s Class B Common Stock shall be subdivided into a greater number of shares or a dividend in Class B Common Stock shall be paid in respect of Class B Common Stock, the Purchase Price in effect immediately prior to such subdivision or at the record date of such dividend shall simultaneously with the effectiveness of such subdivision or immediately after the record date of such dividend be proportionately reduced. If outstanding shares of Class B Common Stock shall be combined into a smaller number of shares, the Purchase Price in effect immediately prior to such combination shall, simultaneously with the effectiveness of such combination, be proportionately increased. When any adjustment is required to be made in the Purchase Price, the number of shares of Warrant Stock purchasable upon the exercise of this Warrant shall be changed to the number determined by dividing (i) an amount equal to the number of shares issuable upon the exercise of this Warrant immediately prior to such adjustment, multiplied by the Purchase Price in effect immediately prior to such adjustment, by (ii) the Purchase Price in effect immediately after such adjustment.

 

(b)                                 Reclassification, Etc. In case there occurs any reclassification or change of the outstanding securities of the Company or of any reorganization of the Company (or any other corporation the stock or securities of which are at the time receivable upon the exercise of this Warrant) or any similar corporate reorganization on or after the date hereof, then and in each such case the Registered Holder, upon the exercise hereof at any time after the consummation of such reclassification, change, or reorganization shall be entitled to receive, in lieu of the stock or other securities and property receivable upon the exercise hereof prior to such consummation, the stock or other securities or property to which such Registered Holder would have been entitled upon such consummation if such Registered Holder had exercised this Warrant immediately prior thereto, all subject to further adjustment pursuant to the provisions of this Section 3.

 

(c)                                  Adjustment Certificate. When any adjustment is required to be made in the Warrant Stock or the Purchase Price pursuant to this Section 3, the Company shall promptly mail to the Registered Holder a certificate setting forth (i) a brief statement of the facts requiring such adjustment, (ii) the Purchase Price after such adjustment and (iii) the kind and amount of stock or other securities or property into which this Warrant shall be exercisable after such adjustment.

 

(d)                                 Acknowledgement. In order to avoid doubt, it is acknowledged that the holder of this Warrant shall be entitled to the benefit of all adjustments in the number of shares of Class B Common Stock of the Company which occur prior to the exercise of this Warrant, including without

 

2

 

limitation, any increase in the number of shares of Class B Common Stock issuable upon conversion as a result of a dilutive issuance of capital stock.

 

4.                                      Transfers.

 

(a)                                 Unregistered Security. Each holder of this Warrant acknowledges that this Warrant, the Warrant Stock and the Common Stock of the Company have not been registered under the Securities Act of 1933, as amended (the “Securities Act”), and covenants and agrees not to sell, pledge, distribute, offer for sale, transfer or otherwise dispose of this Warrant, any Warrant Stock issued upon its exercise or any Class B-2 Common Stock issued upon conversion of the Warrant Stock in the absence of (i) an effective registration statement under the Securities Act as to this Warrant, such Warrant Stock or such Class B-2 Common Stock and registration or qualification of this Warrant, such Warrant Stock or such Class B-2 Common Stock under any applicable U.S. federal or state securities law then in effect, or (ii) an opinion of counsel, satisfactory to the Company (as to form, substance and choice of counsel), that such registration and qualification are not required. Each certificate or other instrument for Warrant Stock issued upon the exercise of this Warrant shall bear a legend substantially to the foregoing effect.

 

(b)                                 Warrant Register. Until any transfer of this Warrant is made in the warrant register, the Company may treat the Registered Holder of this Warrant as the absolute owner hereof for all purposes; provided, however, that if this Warrant is properly assigned in blank, the Company may (but shall not be required to) treat the bearer hereof as the absolute owner hereof for all purposes, notwithstanding any notice to the contrary. Registered Holder may change such Registered Holder’s address as shown on the warrant register by written notice to the Company requesting such change.

 

5.                                      No Impairment. Except as set forth in Section 14 hereof, the Company will not, by amendment of its certificate of incorporation or through reorganization, consolidation, merger, dissolution, sale of assets or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Warrant, but will (subject to Section 14 below) at all times in good faith assist in the carrying out of all such terms and in the taking of all such action as may be necessary or appropriate in order to protect the rights of the holder of this Warrant against impairment.

 

6.                                      Registration and Other Rights. All shares issued upon the exercise of this Warrant shall be entitled to registration rights and other rights, and be subject to the obligations, as set forth in the Investors’ Rights Agreement (as defined in the Purchase Agreement).

 

7.                                      Termination. This Warrant (and the right to purchase securities upon exercise hereof) shall terminate upon the earliest to occur of the following (in each case the “Expiration Date”): (a) the ten (10) year anniversary of the Date of Issuance or (b) a Liquidation Event (as defined in the Company’s Amended and Restated Certificate of Incorporation, filed with the Delaware Secretary of State on or about the Date of Issuance, as may be amended and/or restated from time to time, the “Charter”) or an event deemed to be a Liquidation Event, in accordance with the terms and provisions of the Charter.

 

8.                                      Notices of Certain Transactions. In case:

 

(a)                                 the Company shall take a record of the holders of its Class B Common Stock (or other stock or securities at the time deliverable upon the exercise of this Warrant) for the purpose of entitling or enabling them to receive any dividend or other distribution, or to receive any right to subscribe for or purchase any shares of stock of any class or any other securities, or to receive any other right;

 

3

 

(b)                                 of any capital reorganization of the Company, any reclassification of the capital stock of the Company, any consolidation or merger of the Company with or into another corporation (other than a consolidation or merger in which the Company is the surviving entity);

 

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

 

(d)                                 a Liquidation Event (as defined in the Charter) or an event deemed to be a Liquidation Event, in accordance with the terms and provisions of the Charter

 

then, and in each such case, the Company will mail or cause to be mailed to the Registered Holder of this Warrant a notice specifying, as the case may be, (i) the date on which a record is to be taken for the purpose of such dividend, distribution or right, and stating the amount and character of such dividend, distribution or right, or (ii) the effective date on which such reorganization, reclassification, consolidation, merger, transfer, dissolution, liquidation, winding-up, redemption, Liquidation Event (as defined in the Charter), or deemed Liquidation Event (in accordance with the terms and provisions of the Charter) is to take place, and to the extent applicable for those events set forth in subclauses (i) and (ii) above, the time, if any is to be fixed, as of which the holders of record of Class B Common Stock (or such other stock or securities at the time deliverable upon such reorganization, reclassification, consolidation, merger, transfer, dissolution, liquidation, winding-up, redemption, Liquidation Event (as defined in the Charter), or deemed Liquidation Event (in accordance with the terms and provisions of the Charter), are to be determined. Such notice shall be mailed at least ten (10) business days prior to the record date or effective date for the event specified in such notice.

 

9.                                      Reservation of Stock. The Company will at all times reserve and keep available, solely for the issuance and delivery upon the exercise of this Warrant, such shares of Warrant Stock and other stock, securities and property, as from time to time shall be issuable upon the exercise of this Warrant.

 

10.                               Exchange of Warrants. Upon the surrender by the Registered Holder of any Warrant or Warrants, properly endorsed, to the Company at the principal office of the Company, the Company will, subject to the provisions of Section 4 hereof, issue and deliver to or upon the order of such Registered Holder, at the Company’s expense, a new Warrant or Warrants of like tenor, in the name of such Registered Holder or as such Registered Holder (upon payment by such Registered Holder of any applicable transfer taxes) may direct, calling in the aggregate on the face or faces thereof for the number of shares of Class B-2 Common Stock called for on the face or faces of the Warrant or Warrants so surrendered.

 

11.                               Replacement of Warrants. Upon 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) upon delivery of an indemnity agreement (with surety if reasonably required) in an amount reasonably satisfactory to the Company, or (in the case of mutilation) upon surrender and cancellation of this Warrant, the Company will issue, in lieu thereof, a new Warrant of like tenor.

 

12.                               No Rights as Stockholder. Until the exercise of this Warrant, the Registered Holder of this Warrant shall not have or exercise any rights by virtue hereof as a stockholder of the Company by virtue of the Registered Holder’s possession of this Warrant.

 

13.                               No Fractional Shares. No fractional shares of Class B-2 Common Stock will be issued in connection with any exercise hereunder. In lieu of any fractional shares which would otherwise be issuable, the Company shall pay cash equal to the product of such fraction multiplied by the fair market

 

4

 

value of one share of Class B-2 Common Stock on the date of exercise, as determined in good faith by the Company’s Board of Directors.

 

14.                               Amendment or Waiver. Any term of this Warrant may be amended or waived upon prior written consent of the Company and the holders of at least a majority of the shares of the Class B-2 Common Stock issued or issuable upon exercise of all outstanding Warrants.

 

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

 

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

 

17.                               Survival of Representations. Unless otherwise set forth in this Warrant, the warranties, representations and covenants of the Company contained in or made pursuant to this Warrant shall survive the execution and delivery of this Warrant until the earlier to occur of (a) the expiration of this Warrant or (b) the first anniversary of the date on which this Warrant has been exercised in full; provided, however, that the Company’s obligations under Sections 2(c) and 6 shall survive indefinitely.

 

18.                               Transfer; Successors and Assigns. The terms and conditions of this Warrant shall inure to the benefit of and be binding upon the respective successors and assigns of the parties. Nothing in this Warrant, 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 Warrant, except as expressly provided in this Warrant.

 

19.                               Counterparts. This Warrant may be executed in two or more counterparts, each of which shall be deemed an original and all of which together shall constitute one instrument.

 

20.                               Severability. If one or more provisions of this Warrant are held to be unenforceable under applicable law, the parties agree to renegotiate such provision in good faith. In the event that the parties cannot reach a mutually agreeable and enforceable replacement for such provision, then (a) such provision shall be excluded from this Warrant, (b) the balance of this Warrant shall be interpreted as if such provision were so excluded and (c) the balance of this Warrant shall be enforceable in accordance with its terms.

 

21.                               Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party under this Warrant, upon any breach or default of any other party under this Warrant, shall impair any such right, power or remedy of such non-breaching or non-defaulting party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring; nor shall any waiver of any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this Warrant, or any waiver on the part of any party of any provisions or conditions of this Warrant, must be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Warrant or by law or otherwise afforded to any party, shall be cumulative and not alternative.

 

22.                               Notices. Any notice required or permitted by this Warrant shall be in accordance with the notice provisions in the Purchase Agreement.

 

5

 

23.                               Entire Agreement. This Warrant, and the documents referred to herein constitute 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.

 

[The remainder of this page is intentionally left blank.]

 

6

 

IN WITNESS WHEREOF, the parties have executed this Warrant, as of the Date of Issuance first written above.

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
AVEXIS, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
 
    
	
 
    	
 
    	
Title:
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Accepted   and Agreed:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
PBM   CAPITAL INVESTMENTS, LLC
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    	
 
    

 

CLASS B-2 COMMON STOCK WARRANT

 

 

EXHIBIT A

 

PURCHASE/EXERCISE FORM

 

	
To:                             AveXis, Inc.
    	
 
    	
 
    	
Dated:
    

 

The undersigned, pursuant to the provisions set forth in the attached Warrant No.      , issued pursuant to that certain Class B Common Stock Purchase Agreement dated as of January 30, 2014 (the “Purchase Agreement”) hereby irrevocably elects to purchase            shares of the Class B-2 Common Stock covered by such Warrant and herewith makes payment of $    , representing the full purchase price for such shares at the price per share provided for in such Warrant.

 

The undersigned acknowledges that it has reviewed the representations and warranties contained in Section 3 of the Purchase Agreement and by its signature below hereby makes such representations and warranties to the Company as of the date hereof.

 

	
 
    	
 
    
	
 
    	
PBM CAPITAL   INVESTMENTS, LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Signature:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Name (print):
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Title”
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Company:Exhibit 10.1

 

THIRD AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

THIS THIRD AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this “Agreement”), is made as of the 3rd day of September, 2015, by and among AVEXIS, INC., a Delaware corporation (the “Company”), the investors listed on Schedule A hereto (the “Investors”) and each of the stockholders listed on Schedule B hereto (the “Key Holders”).

 

RECITALS

 

WHEREAS, the Company, the Key Holders and certain of the Investors (collectively, the “Prior Parties”) entered into that certain Second Amended and Restated Investor Rights Agreement dated April 22, 2015 (the “Prior Agreement”);

 

WHEREAS, the Prior Parties desire to induce certain of the Investors to purchase shares of Class D Common Stock pursuant to the Class D Common Stock Purchase Agreement dated as of the date hereof by and among the Company and certain of the Investors (the “Purchase Agreement”) by amending and restating the Prior Agreement in its entirety and providing certain Investors with the right forth herein; and

 

WHEREAS, the parties hereto desire to amend and restate the Prior Agreement in its entirety as set forth herein.

 

NOW, THEREFORE, the parties hereby agree as follows:

 

1.                                      Definitions.  For purposes of this Agreement:

 

1.1                               “Affiliate” means, with respect to any specified Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common control with such Person, including without limitation any general partner, managing member, member, officer or director of such Person, or any venture capital or other investment fund now or hereafter existing that is controlled by one or more general partners or managing members of, or shares the same management company or investment advisor with, such Person.

 

1.2                               “Change of Control” means a transaction or series of related transactions in which a person, or a group of related persons, acquires from stockholders of the Company shares representing more than fifty percent (50%) of the outstanding voting power of the Company.

 

1.3                               “Class B Director” means the director of the Company that PBM is entitled to elect pursuant to this Agreement.

 

1.4                               “Class C Director” means each director of the Company that Deerfield is entitled to elect pursuant to this Agreement.

 

1.5                               “Common Stock” means shares of the Company’s Class A Common Stock, shares of the Company’s Class B-1 Common Stock, shares of the Company’s Class B-2

 

 

Common Stock, shares of the Company’s Class C Common Stock and shares of the Company’s Class D Common Stock, each with par value $0.0001 per share.

 

1.6                               “Damages” means any loss, damage, claim or liability (joint or several) to which a party hereto may become subject under the Securities Act, the Exchange Act, or other federal or state law, insofar as such loss, damage, claim or liability (or any action in respect thereof) arises out of or is based upon: (i) any untrue statement or alleged untrue statement of a material fact contained in any registration statement of the Company, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto; (ii) an omission or alleged omission to state therein 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 indemnifying party (or any of its agents or Affiliates) 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.

 

1.7                               “Derivative Securities” means any securities or rights convertible into, or exercisable or exchangeable for (in each case, directly or indirectly), Common Stock, including options and warrants.

 

1.8                               “Exchange Act” means the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.

 

1.9                               “Excluded Registration” means (i) a registration relating to the sale of securities to employees of the Company or a subsidiary pursuant to a stock option, stock purchase, or similar plan; (ii) a registration relating to an SEC Rule 145 transaction; (iii) a registration on any form that does not include substantially the same information as would be required to be included in a registration statement covering the sale of the Registrable Securities; or (iv) a registration in which the only Common Stock being registered is Common Stock issuable upon conversion of debt securities that are also being registered.

 

1.10                        “Form S-1” means such form under the Securities Act as in effect on the date hereof or any successor registration form under the Securities Act subsequently adopted by the SEC.

 

1.11                        “Form S-3” means such form under the Securities Act as in effect on the date hereof or any registration form under the Securities Act subsequently adopted by the SEC that permits incorporation of substantial information by reference to other documents filed by the Company with the SEC.

 

1.12                        “GAAP” means generally accepted accounting principles in the United States.

 

1.13                        “Holder” means any holder of Registrable Securities who is a party to this Agreement.

 

1.14                        “Immediate Family Member” means a child, stepchild, grandchild, parent, stepparent, grandparent, spouse, sibling, mother-in-law, father-in-law, son-in-law,

 

2

 

daughter-in-law, brother-in-law, or sister-in-law, including, adoptive relationships, of a natural person referred to herein.

 

1.15                        “Initiating Holders” means, collectively, Holders who properly initiate a registration request under this Agreement.

 

1.16                        “IPO” means the closing of the first firm commitment underwritten public offering of shares of the Common Stock of the Company.

 

1.17                        “New Securities” means, collectively, equity securities of the Company, whether or not currently authorized, as well as rights, options, or warrants to purchase such equity securities, or securities of any type whatsoever that are, or may become, convertible or exchangeable into or exercisable for such equity securities.

 

1.18                        “PBM”  means PBM Capital Investments, LLC.

 

1.19                        “PBM Co-Investors” means Adam Burke, Kevin Combs, Damian deGoa, Steven Goldman, Mike McCauley, James Reebals, Jayson Rieger, Eugene Scavola, Russell Schundler and Sean Stalfort, and any other Affiliate of PBM or any of such identified Persons.  All Registrable Securities held or acquired by PBM and the PBM Co-Investors shall be aggregated and be deemed to be held by PBM for the purpose of determining the availability of any rights of PBM under this Agreement, including but not limited to Sections 5.5(d) and 5.6.

 

1.20                        “Person” means any individual, corporation, partnership, trust, limited liability company, association or other entity.

 

1.21                        “Proposed Key Holder Transfer” means any assignment, sale, offer to sell, pledge, mortgage, hypothecation, encumbrance, disposition of or any other like transfer or encumbering of any Common Stock (or any interest therein) proposed by any of the Key Holders.

 

1.22                        “Proposed Transfer Notice” means written notice from a Key Holder setting forth the terms and conditions of a Proposed Key Holder Transfer.

 

1.23                        “Prospective Transferee” means any person other than the Company to whom a Key Holder proposes to make a Proposed Key Holder Transfer.

 

1.24                        “Registrable Securities” means (i) any Common Stock held by the Investors on the date hereof, (ii) any Common Stock or any Common Stock issued or issuable (directly or indirectly) upon conversion and/or exercise of any other securities of the Company, acquired by an Investor after the date hereof and (iii) any Common Stock issued as (or issuable upon the conversion or exercise of any warrant, right, or other security that is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of, the shares referenced in clauses (i) or (ii) above.

 

1.25                        “Registrable Securities then outstanding” means the number of shares determined by adding the number of shares of outstanding Common Stock that are Registrable

 

3

 

Securities and the number of shares of Common Stock issuable (directly or indirectly) pursuant to then exercisable and/or convertible securities that are Registrable Securities.

 

1.26                        “Restated Certificate” means the Company’s Third Amended and Restated Certificate of Incorporation, as amended from time to time.

 

1.27                        “Restricted Securities” means the securities of the Company required to be notated with the legend set forth in Subsection 2.12(b) hereof.

 

1.28                        “Right of Co-Sale” means the right, but not an obligation, of an Investor to participate in a Proposed Key Holder Transfer on the terms and conditions specified in the Proposed Transfer Notice.

 

1.29                        “SEC” means the Securities and Exchange Commission.

 

1.30                        “SEC Rule 144” means Rule 144 promulgated by the SEC under the Securities Act.

 

1.31                        “SEC Rule 145” means Rule 145 promulgated by the SEC under the Securities Act.

 

1.32                        “Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.

 

1.33                        “Selling Expenses” means all underwriting discounts, selling commissions, and stock transfer taxes applicable to the sale of Registrable Securities, and fees and disbursements of counsel for any Holder, other than the fees and disbursements of the Selling Holder Counsel borne and paid by the Company pursuant to Section 2.6.

 

1.34                        “T. Rowe Price” shall mean T. Rowe Price Associates, Inc. and any successor or affiliated registered investment advisor to the T. Rowe Price Investors.

 

1.35                        “T. Rowe Price Investors” shall mean the Investors that are advisory clients of T. Rowe Price.

 

2.                                      Registration Rights.  The Company covenants and agrees as follows:

 

2.1                               Demand Registrations.

 

(a)               Form S-1 Demand.  If at any time after one hundred eighty (180) days after the effective date of the registration statement for the IPO, the Company receives a request from Holders of at least fifty percent (50%) of the Registrable Securities then outstanding that the Company file a Form S-1 registration statement with respect to the Registrable Securities then outstanding, then the Company shall (i) within ten (10) days after the date such request is given, give notice thereof (the “Demand Notice”) to all Holders other than the Initiating Holders; and (ii) as soon as practicable, and in any event within sixty (60) days after the date such request is given by the Initiating Holders, file a Form S-1 registration statement under the Securities Act covering all Registrable Securities that the Initiating Holders requested to be

 

4

 

registered and any additional Registrable Securities requested to be included in such registration by any other Holders, as specified by notice given by each such Holder to the Company within twenty (20) days of the date the Demand Notice is given, and in each case, subject to the limitations of Section 2.1(c) and Section 2.3.

 

(b)               Form S-3 Demand.  If at any time when it is eligible to use a Form S-3 registration statement, the Company receives a request from Holders of the Registrable Securities then outstanding that the Company file a Form S-3 registration statement with respect to outstanding Registrable Securities of such Holders having an anticipated aggregate offering price, net of Selling Expenses, of at least $3,000,000, then the Company shall (i) within ten (10) days after the date such request is given, give a Demand Notice to all Holders other than the Initiating Holders; and (ii) as soon as practicable, and in any event within forty-five (45) days after the date such request is given by the Initiating Holders, file a Form S-3 registration statement under the Securities Act covering all Registrable Securities requested to be included in such registration by any other Holders, as specified by notice given by each such Holder to the Company within twenty (20) days of the date the Demand Notice is given, and in each case, subject to the limitations of Section 2.1(c) and Section 2.3.

 

(c)                Notwithstanding the foregoing obligations, if the Company furnishes to Holders requesting a registration pursuant to this Section 2.1 a certificate signed by the Company’s chief executive officer stating that in the good faith judgment of the Company’s Board of Directors it would be detrimental to the Company and its stockholders for such registration statement to either become effective or remain effective for as long as such registration statement otherwise would be required to remain effective, because such action would (i) materially interfere with a significant acquisition, corporate reorganization, or other similar transaction involving the Company; (ii) require premature disclosure of material information that the Company has a bona fide business purpose for preserving as confidential; or (iii) render the Company unable to comply with requirements under the Securities Act or Exchange Act, then (A) with respect to filings requested pursuant to Section 2.1(a), the Company shall have the right to defer taking action with respect to such filing, and any time periods with respect to filing or effectiveness thereof shall be tolled correspondingly, for up to two periods of not more than ninety (90) days individually or one hundred twenty (120) days in the aggregate after the request of the Initiating Holders is given pursuant to Section 2.1(a), provided that the Company shall not utilize such right more than once in any twelve (12) month period and (B) with respect to filings requested pursuant to Section 2.1(b), for a period of not more than seventy-five (75) days after the request of the Initiating Holders is given pursuant to Section 2.1(b), provided that the Company shall not utilize such right more than twice in any twelve (12) month period.

 

(d)               The Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to Section 2.1(a) (i) after the Company has effected one registration pursuant to Section 2.1(a); (ii) during the one hundred and eighty (180) day period commencing with the date of the IPO; or (iii) 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 2.1(b).  The Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to Section 2.1(b) if the Company has effected two registrations pursuant to Section 2.1(b) within the twelve (12) month period immediately

 

5

 

preceding the date of such request.  The Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to Sections 2.1(a) and 2.1(b) after 75% of the Registrable Securities have been registered pursuant to this Agreement. The Company shall not be obligated to effect any registration 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 unless the Company is already required to qualify to do business or subject to service in such jurisdiction.  A registration shall not be counted as “effected” for purposes of this Section 2.1(d) until such time as the applicable registration statement has been declared effective by the SEC, unless the Initiating Holders withdraw their request for such registration, elect not to pay the registration expenses therefor, and forfeit their right to one demand registration statement pursuant to Section 2.6, in which case such withdrawn registration statement shall be counted as “effected” for purposes of this Section 2.1(d).

 

2.2                               Company Registration.  If the Company proposes to register (including, for this purpose, a registration effected by the Company for stockholders other than the Holders) any of its Common Stock under the Securities Act in connection with the public offering of such securities solely for cash (other than in an Excluded Registration), the Company shall, at such time, promptly give each Holder notice of such registration.  Upon the request of each Holder given within twenty (20) days after such notice is given by the Company, the Company shall, subject to the provisions of Section 2.3, cause to be registered all of the Registrable Securities that each such Holder has requested to be included in such registration.  The Company shall have the right to terminate or withdraw any registration initiated by it under this Subsection 2.2 before the effective date of such registration, whether or not any Holder has elected to include Registrable Securities in such registration.  The expenses (other than Selling Expenses) of such withdrawn registration shall be borne by the Company in accordance with Subsection 2.6.

 

2.3                               Underwriting Requirements.

 

(a)                                 If, pursuant to Section 2.1, 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 made pursuant to Section 2.1, and the Company shall include such information in the Demand Notice.  The underwriter(s) will be selected by the Company and shall be reasonably acceptable to a majority in interest of the Initiating Holders.  In such event, the right of any Holder to include such Holder’s 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 to the extent provided herein.  All Holders proposing to distribute their securities through such underwriting shall (together with the Company as provided in Section 2.4(e)) enter into an underwriting agreement in customary form with the underwriter(s) selected for such underwriting.  Notwithstanding any other provision of this Section 2.3, if the managing underwriters advise the Initiating Holders in writing that marketing factors require a limitation on the number of shares to be underwritten, then the Initiating Holders shall so advise all Holders of Registrable Securities that otherwise would be underwritten pursuant hereto, and the number of Registrable Securities that may be included in the underwriting shall be allocated among such Holders of Registrable Securities, including the Initiating Holders, in proportion (as nearly as practicable) to the number of Registrable Securities owned by each Holder or in such other proportion as shall mutually be agreed to by all such selling Holders; provided, however, that the

 

6

 

number of Registrable Securities held by the Holders to be included in such underwriting shall not be reduced unless all other securities are first entirely excluded from the underwriting.  To facilitate the allocation of shares in accordance with the above provisions, the Company or the underwriters may round the number of shares allocated to any Holder to the nearest 100 shares.

 

(b)                                 In connection with any offering involving an underwriting of shares of the Company’s capital stock pursuant to Subsection 2.2, the Company shall not be required to include any of the Holders’ Registrable Securities in such underwriting unless the Holders accept the terms of the underwriting as agreed upon between the Company and its underwriters, and then only in such quantity as the underwriters in their sole discretion determine will not jeopardize the success of the offering by the Company.  If the total number of securities, including Registrable Securities, requested by stockholders to be included in such offering exceeds the number of securities to be sold (other than by the Company) that the underwriters in their reasonable discretion determine 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 and the Company in their sole discretion determine will not jeopardize the success of the offering.  If the underwriters determine that less than all of the Registrable Securities requested to be registered can be included in such offering, then the Registrable Securities that are included in such offering shall be allocated among the selling Holders in proportion (as nearly as practicable to) the number of Registrable Securities owned by each selling Holder or in such other proportions as shall mutually be agreed to by all such selling Holders.  To facilitate the allocation of shares in accordance with the above provisions, the Company or the underwriters may round the number of shares allocated to any Holder to the nearest one hundred (100) shares.  Notwithstanding the foregoing, in no event shall the number of Registrable Securities included in the offering be reduced unless all other securities (other than securities to be sold by the Company) are first entirely excluded from the offering.  For purposes of the provision in this Subsection 2.3(b) concerning apportionment, for any selling Holder that is a partnership, limited liability company, or corporation, the partners, members, retired partners, retired members, stockholders, and Affiliates of such Holder, or the estates and Immediate Family Members of any such partners, retired partners, members, and retired members and any trusts for the benefit of any of the foregoing Persons, shall be deemed to be a single “selling Holder,” and any pro rata reduction with respect to such “selling Holder” shall be based upon the aggregate number of Registrable Securities owned by all Persons included in such “selling Holder,” as defined in this sentence.

 

2.4                               Obligations of the Company.  Whenever required under this Section 2 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 its 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 a period of up to one hundred twenty (120) days or, if earlier, until the distribution contemplated in the registration statement has been completed; provided, however, that such one hundred twenty (120) day period shall be extended for a period of time equal to the period the Holder refrains, at

 

7

 

the request of an underwriter of Common Stock (or other securities) of the Company, from selling any securities included in such registration;

 

(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 Securities Act in order to enable the disposition of all securities covered by such registration statement;

 

(c)                                  furnish to the selling Holders such numbers of copies of a prospectus, including a preliminary prospectus, as required by the Securities Act, and such other documents as the Holders may reasonably request in order to facilitate their disposition of their Registrable Securities;

 

(d)                                 use its 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 selling Holders; provided that the Company shall not be required 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 subject to service in such jurisdiction and except as may be required by the Securities Act;

 

(e)                                  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 underwriter(s) of such offering;

 

(f)                                   use its commercially reasonable efforts to cause all such Registrable Securities covered by such registration statement to be listed on a national securities exchange or trading system and each securities exchange and trading system (if any) on which similar securities issued by the Company are then listed;

 

(g)                                  provide a transfer agent and registrar for all Registrable Securities registered pursuant to this Agreement and provide a CUSIP number for all such Registrable Securities, in each case not later than the effective date of such registration;

 

(h)                                 promptly make available for inspection by the selling Holders, any underwriter(s)  participating in any disposition pursuant to such registration statement, and any attorney or accountant or other agent retained by any such underwriter or selected by the selling Holders, all financial and other records, pertinent corporate documents, and properties of the Company, and cause the Company’s officers, directors, employees, and independent accountants to supply all information reasonably requested by any such seller, underwriter, attorney, accountant, or agent, in each case, as necessary or advisable to verify the accuracy of the information in such registration statement and to conduct appropriate due diligence in connection therewith;

 

(i)                                     notify each selling Holder, promptly after the Company receives notice thereof, of the time when such registration statement has been declared effective or a supplement to any prospectus forming a part of such registration statement has been filed; and

 

8

 

(j)                                    after such registration statement becomes effective, notify each selling Holder of any request by the SEC that the Company amend or supplement such registration statement or prospectus.

 

In addition, the Company shall ensure that, at all times after any registration statement covering a public offering of securities of the Company under the Securities Act shall have become effective, its insider trading policy shall provide that the Company’s directors may implement a trading program under Rule 10b5-1 of the Exchange Act.

 

2.5                               Furnish Information.  It shall be a condition precedent to the obligations of the Company to take any action pursuant to this Section 2 with respect to the Registrable Securities of any selling Holder that such Holder shall furnish to the Company such information regarding itself, the Registrable Securities held by it, and the intended method of disposition of such securities as is reasonably required to effect the registration of such Holder’s Registrable Securities.

 

2.6                               Expenses of Registration.  All expenses (other than Selling Expenses) incurred in connection with registrations, filings, or qualifications pursuant to Section 2, including all registration, filing, and qualification fees; printers’ and accounting fees; fees and disbursements of counsel for the Company, and the reasonable fees and disbursements, not to exceed $35,000, of one counsel for the selling Holders (“Selling Holder Counsel”) shall be borne and paid by the Company provided, however, that the Company shall not be required to pay for any expenses of any registration proceeding begun pursuant to Subsection 2.1 if the registration request is subsequently withdrawn at the request of the Holders of a majority of the Registrable Securities to be registered (in which case all selling Holders shall bear such expenses pro rata based upon the number of Registrable Securities that were to be included in the withdrawn registration), unless the Holders of a majority of the Registrable Securities agree to forfeit their right to one registration pursuant to Subsections 2.1(a) or 2.1(b), as the case may be.  All Selling Expenses relating to Registrable Securities registered pursuant to this Section 2 shall be borne and paid by the Holders pro rata on the basis of the number of Registrable Securities registered on their behalf.

 

2.7                               Delay of Registration.  No Holder shall have any right to obtain or seek an injunction restraining or otherwise delaying any registration pursuant to this Agreement as the result of any controversy that might arise with respect to the interpretation or implementation of this Section 2.

 

2.8                               Indemnification.  If any Registrable Securities are included in a registration statement under this Section 2:

 

(a)                                 To the extent permitted by law, the Company will indemnify and hold harmless each selling Holder, and the partners, members, officers, directors, and stockholders of each such Holder; legal counsel, accountants and investment advisors for each such Holder; any underwriter (as defined in the Securities Act) for each 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 Damages, and the Company will pay to each such Holder, underwriter, controlling Person, or other aforementioned Person any legal or other expenses

 

9

 

reasonably incurred thereby in connection with investigating or defending any claim or proceeding from which Damages may result, as such expenses are incurred; provided, however, that the indemnity agreement contained in this Subsection 2.8(a) shall not apply to amounts paid in settlement of any such claim or proceeding if such settlement is effected without the consent of the Company, which consent shall not be unreasonably withheld (for sake of clarity, it shall be reasonable for the Company to withhold its consent for, among other reasons, if the terms of such settlement contain admissions of wrongdoing by Company or any covenants or other restrictions affecting the Company’s future activities), nor shall the Company be liable for any Damages to the extent that they arise out of or are based upon actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of any such Holder, underwriter, controlling Person, or other aforementioned Person expressly for use in connection with such registration.

 

(b)                                 To the extent permitted by law, each selling Holder, severally and not jointly, will indemnify and hold harmless the Company, and 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, legal counsel and accountants for the Company, any underwriter (as defined in the Securities Act), any other Holder selling securities in such registration statement, and any controlling Person of any such underwriter or other Holder, against any Damages, in each case only to the extent that such Damages arise out of or are based upon actions or omissions made in reliance upon and in conformity with written information furnished by or on behalf of such selling Holder expressly for use in connection with such registration; and each such selling Holder will pay to the Company and each other aforementioned Person any legal or other expenses reasonably incurred thereby in connection with investigating or defending any claim or proceeding from which Damages may result, as such expenses are incurred; provided, however, that the indemnity agreement contained in this Subsection 2.8(b) shall not apply to amounts paid in settlement of any such claim or proceeding if such settlement is effected without the consent of the Holder, which consent shall not be unreasonably withheld; and provided further that in no event shall the aggregate amounts payable by any Holder by way of indemnity or contribution under Subsections 2.8(b) and 2.8(d) exceed the proceeds from the offering received by such Holder (net of any Selling Expenses paid by such Holder), except in the case of fraud or willful misconduct by such Holder.

 

(c)                                  Promptly after receipt by an indemnified party under this Subsection 2.8 of notice of the commencement of any action (including any governmental action) for which a party may be entitled to indemnification hereunder, such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Subsection2.8, give the indemnifying party notice of the commencement thereof.  The indemnifying party shall have the right to participate in such action and, to the extent the indemnifying party so desires, participate jointly with any other indemnifying party to which notice has been given, and to assume the defense thereof with counsel selected by the indemnifying party and approved by the indemnified party, such approval not to be unreasonably withheld, conditioned or delayed; provided, however, that an indemnified party (together with all other indemnified parties that may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the 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

 

10

 

indemnified party and any other party represented by such counsel in such action.  The failure to give notice to the indemnifying party within a reasonable time of the commencement of any such action shall relieve such indemnifying party of any liability to the indemnified party under this Subsection 2.8, to the extent that such failure materially prejudices the indemnifying party’s ability to defend such action.  The failure to give notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than under this Subsection 2.8.

 

(d)                                 To provide for just and equitable contribution to joint liability under the Securities Act in any case in which either: (i) any party otherwise entitled to indemnification hereunder makes a claim for indemnification pursuant to this Subsection 2.8 but it is judicially determined (by the entry of a final judgment or decree by a court of competent jurisdiction and the expiration of time to appeal or the denial of the last right of appeal) that such indemnification may not be enforced in such case, notwithstanding the fact that this Subsection 2.8 provides for indemnification in such case, or (ii) contribution under the Securities Act may be required on the part of any party hereto for which indemnification is provided under this Subsection 2.8, then, and in each such case, such parties will contribute to the aggregate losses, claims, damages, liabilities, or expenses to which they may be subject (after contribution from others) in such proportion as is appropriate to reflect the relative fault of each of the indemnifying party and the indemnified party in connection with the statements, omissions, or other actions that resulted in such loss, claim, damage, liability, or expense, as well as to reflect any other relevant equitable considerations.  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 allegedly untrue statement of a material fact, or the omission or alleged omission of 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; provided, however, that, in any such case (x) no Holder will be required to contribute any amount in excess of the public offering price of all such Registrable Securities offered and sold by such Holder pursuant to such registration statement, and (y) no Person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) will be entitled to contribution from any Person who was not guilty of such fraudulent misrepresentation; and provided further that in no event shall a Holder’s liability pursuant to this Subsection 2.8(d), when combined with the amounts paid or payable by such Holder pursuant to Subsection 2.8(b), exceed the proceeds from the offering received by such Holder (net of any Selling Expenses paid by such Holder), except in the case of willful misconduct or fraud by such Holder.

 

(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)                                   Unless otherwise superseded by an underwriting agreement entered into in connection with the underwritten public offering, the obligations of the Company and Holders under this Subsection 2.8 shall survive the completion of any offering of Registrable Securities in a registration under this Section 2, and otherwise shall survive the termination of this Agreement.

 

11

 

2.9                               Reports Under Exchange Act.  With a view to making available to the Holders the benefits of SEC Rule 144 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 shall:

 

(a)                                 make and keep available adequate current public information, as those terms are understood and defined in SEC Rule 144, at all times after the effective date of the registration statement filed by the Company for the IPO;

 

(b)                                 use commercially reasonable efforts to 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 (at any time after the Company has become subject to such reporting requirements); and

 

(c)                                  furnish to any Holder, so long as the Holder owns any Registrable Securities, forthwith upon request (i) to the extent accurate, a written statement by the Company that it has complied with the reporting requirements of SEC Rule 144 (at any time after ninety (90) days after the effective date of the registration statement filed by the Company for the IPO), the Securities Act, and the Exchange Act (at any time after the Company 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 the Company 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 that permits the selling of any such securities without registration (at any time after the Company has become subject to the reporting requirements under the Exchange Act) or pursuant to Form S-3 (at any time after the Company so qualifies to use such form).

 

2.10                        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 a majority of the Registrable Securities then outstanding, enter into any agreement with any holder or prospective holder of any securities of the Company that (i) would provide to such holder the right to include securities in any registration, unless the inclusion of such securities is on a subordinate basis after all Holders have had the opportunity to include in the registration and offering all shares of Registrable Securities that they wish to so include or (ii) allow such holder or prospective holder to initiate a demand for registration of any securities held by such holder or prospective holder.

 

2.11                        “Market Stand-off” Agreement.  Each Holder and Key Holder hereby agrees that it will not, without the prior written consent of the managing underwriter, during the period commencing on the date of the final prospectus relating to the IPO, and ending on the date specified by the Company and the managing underwriter (such period not to exceed one hundred eighty (180) days, or such other period as may be requested by the Company or an underwriter to accommodate regulatory restrictions on (1) the publication or other distribution of research reports, and (2) analyst recommendations and opinions, including, but not limited to, the restrictions contained in FINRA Rule 2711(f)(4) or NYSE Rule 472(f)(4), or any successor provisions or amendments thereto), (i) lend; offer; pledge; sell; contract to sell; sell any option or

 

12

 

contract to purchase; purchase any option or contract to sell; grant any option, right, or warrant to purchase; or otherwise transfer or dispose of, directly or indirectly, any shares of Common Stock or any securities convertible into or exercisable or exchangeable (directly or indirectly) for Common Stock held immediately before the effective date of the registration statement for the IPO or (ii) enter into any swap or other arrangement that transfers to another, in whole or in part, any of the economic consequences of ownership of such securities, whether any such transaction described in clause (i) or (ii) above is to be settled by delivery of Common Stock or other securities, in cash, or otherwise.  The foregoing provisions of this Subsection 2.11 (A) shall apply only to the IPO, (B) shall not apply to shares of Common Stock acquired in the IPO or in the open market following the IPO and (C) shall not apply to the sale of any shares to an underwriter pursuant to an underwriting agreement, or the transfer of any shares to any trust for the direct or indirect benefit of the Holder or Key Holder, as applicable, or the immediate family of the Holder or Key Holder, as applicable, provided that the trustee of the trust agrees to be bound in writing by the restrictions set forth herein, and provided further that any such transfer shall not involve a disposition for value, and shall be applicable to the Holders only if all officers, directors, Nationwide Children’s Hospital (if it holds any shares) and all current parties to this Agreement are subject to the same restrictions.  In addition, the Company shall use its best efforts to obtain a similar agreement from all other stockholders individually owning more than one percent (1%) of the Company’s outstanding Common Stock (after giving effect to conversion into Common Stock of all outstanding Preferred Stock) to the extent such stockholders are not already party to this Agreement.  The underwriters in connection with such registration are intended third-party beneficiaries of this Subsection 2.11 and shall have the right, power and authority to enforce the provisions hereof as though they were a party hereto.  Each Holder and Key Holder further agrees to execute such agreements as may be reasonably requested by the underwriters in connection with such registration that are consistent with this Subsection 2.11 or that are necessary to give further effect thereto.  If any of the obligations described in this Subection 2.11 are waived or terminated with respect to any of the securities of any such Holder, Key Holder, officer, director or other stockholder (in any such case, the “Released Securities”), the foregoing provisions shall be waived or terminated, as applicable, to the same extent and with respect to the same percentage of securities of each Holder as the percentage of Released Securities represent with respect to the securities held by the applicable Holder, Key Holder officer, director or other stockholder, subject to customary exceptions.

 

2.12                        Restrictions on Transfer.

 

(a)                                 The Common Stock and the Registrable Securities shall not be sold, pledged, or otherwise transferred, and the Company shall not recognize and shall issue stop-transfer instructions to its transfer agent with respect to any such sale, pledge, or transfer, except upon the conditions specified in this Agreement, which conditions are intended to ensure compliance with the provisions of the Securities Act.  A transferring Holder will cause any proposed purchaser, pledgee, or transferee of the Common Stock and the Registrable Securities held by such Holder to agree to take and hold such securities subject to the provisions and upon the conditions specified in this Agreement.  Notwithstanding the foregoing, the Company shall not require any transferee who receives shares pursuant to an effective registration statement or, following the IPO, pursuant to SEC Rule 144 to be bound by the terms of this Agreement.

 

13

 

(b)                                 Each certificate, instrument, or book entry representing (i) the Common Stock, (ii) the Registrable Securities, and (iii) any other securities issued in respect of the securities referenced in clauses (i) and (ii), upon any stock split, stock dividend, recapitalization, merger, consolidation, or similar event, shall (unless otherwise permitted by the provisions of Subsection 2.12(c)) be notated with a legend substantially in the following form:

 

THE SECURITIES REPRESENTED HEREBY HAVE BEEN ACQUIRED FOR INVESTMENT AND HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933.  SUCH SHARES MAY NOT BE SOLD, PLEDGED, OR TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR A VALID EXEMPTION FROM THE REGISTRATION AND PROSPECTUS DELIVERY REQUIREMENTS OF SAID ACT.

 

THE SECURITIES REPRESENTED HEREBY MAY BE TRANSFERRED ONLY IN ACCORDANCE WITH THE TERMS OF AN AGREEMENT BETWEEN THE COMPANY AND THE STOCKHOLDER, A COPY OF WHICH IS ON FILE WITH THE SECRETARY OF THE COMPANY.

 

The Holders consent to the Company making a notation in its records and giving instructions to any transfer agent of the Restricted Securities in order to implement the restrictions on transfer set forth in this Subsection 2.12.

 

(c)                                  The holder of such Restricted Securities, by acceptance of ownership thereof, agrees to comply in all respects with the provisions of this Section 2.12.  Before any proposed sale, pledge, or transfer of any Restricted Securities, unless there is in effect a registration statement under the Securities Act covering the proposed transaction or, following the IPO, the transfer is made pursuant to SEC Rule 144, the Holder thereof shall give notice to the Company of such Holder’s intention to effect such sale, pledge, or transfer.  Each such notice shall describe the manner and circumstances of the proposed sale, pledge, or transfer in sufficient detail and, if reasonably requested by the Company, shall be accompanied at such Holder’s expense by either (i) a written opinion of legal counsel who shall, and whose legal opinion shall, be reasonably satisfactory to the Company (as to form, substance and choice of counsel), addressed to the Company, to the effect that the proposed transaction may be effected without registration under the Securities Act; (ii) a “no action” letter from the SEC to the effect that the proposed sale, pledge, or transfer of such Restricted Securities without registration will not result in a recommendation by the staff of the SEC that action be taken with respect thereto; or (iii) any other evidence reasonably satisfactory to counsel to the Company to the effect that the proposed sale, pledge, or transfer of the Restricted Securities may be effected without registration under the Securities Act, whereupon the Holder of such Restricted Securities shall be entitled to sell, pledge, or transfer such Restricted Securities in accordance with the terms of the notice given by the Holder to the Company.  The Company will not require such a legal opinion or “no action” letter (x) following the IPO, in any transaction in compliance with SEC Rule 144 and (y) in any transaction in which such Holder distributes Restricted Securities to an Affiliate of such Holder for no consideration; provided that, with respect to transfers under the foregoing clause (y), each transferee agrees in writing to be subject to the terms of this Subsection 2.12.  Each certificate, instrument, or book entry representing the Restricted Securities transferred as above provided shall be notated with, except if such transfer is made pursuant to SEC Rule 144

 

14

 

or pursuant to an effective registration statement, the appropriate restrictive legend set forth in Subsection 2.12(b), except that such certificate instrument, or book entry shall not be notated with such restrictive legend if, in the opinion of counsel for such Holder and the Company, such legend is not required in order to establish compliance with any provisions of the Securities Act.

 

2.13                        Termination of Registration Rights.  The right of any Holder to request inclusion of Registrable Securities in any registration pursuant to Subsection 2.2 or Subsection 2.2 shall terminate upon the earlier to occur of:

 

(a)                                 the closing of a Liquidation Event, as such term is defined in the Company’s Restated Certificate; and

 

(b)                                 following the IPO, such time as Rule 144 or another similar exemption under the Securities Act is available for the sale of all of such Holder’s shares without limitation during a three-month period without registration (and without the requirement for the Company to be in compliance with the current public information required under Rule 144(c)(1)).

 

3.                                      Information Rights.

 

3.1                               Delivery of Financial Statements.  The Company shall deliver to the Investors:

 

(a)                                 As soon as practicable, but in any event within 120 days after the end of each fiscal year of the Company (i) an audited balance sheet as of the end of such year, (ii) audited statements of income and of cash flows for such year, and (iii) a statement of stockholders’ equity as of the end of such year;

 

(b)                                 as soon as practicable, but in any event within 30 days after the end of each of the first three (3) quarters of each fiscal year of the Company, unaudited statements of income and cash flows for such fiscal quarter, and an unaudited balance sheet and a statement of stockholders’ equity as of the end of such fiscal quarter, all prepared in accordance with GAAP (except that such financial statements may (i) be subject to normal year-end adjustments; and (ii) not contain all notes thereto that may be required in accordance with GAAP);

 

(c)                                  concurrently with the delivery of the financial statements described in Sections 3.1(a) and 3.1(b), a statement showing the number of shares of each class and series of capital stock and securities convertible into or exercisable for shares of capital stock outstanding at the end of the period, the Common Stock issuable upon conversion or exercise of any outstanding securities convertible or exercisable for Common Stock and the exchange ratio or exercise price applicable thereto, and the number of shares of issued stock options and stock options not yet issued but reserved for issuance, if any, all in sufficient detail as to permit each Investor to calculate its percentage equity ownership in the Company, and certified by the chief financial officer or chief executive officer of the Company as being true, complete, and correct;

 

(d)                                 as soon as practicable, but in any event within thirty (30) days of the end of each month, an unaudited income statement and statement of cash flows for such month, and an unaudited balance sheet and statement of stockholders’ equity as of the end of

 

15

 

such month, all prepared in accordance with GAAP (except that such financial statements may (i) be subject to normal year-end adjustments and (ii) not contain all notes thereto that may be required in accordance with GAAP);

 

(e)                                  as soon as practicable, but in any event ten (10) days before the end of each fiscal year, a budget and business plan for the next fiscal year approved by the Board of Directors (including either the Class B Director or a Class C Director, provided that at the time of such approval either PBM has a Class B Director or Deerfield has a Class C Director seated on the Company’s Board of Directors, and such director does not unreasonably withhold his approval of such budget and business plan) no later than 30 days following the beginning of such next fiscal year (collectively, the “Budget”), and prepared on a monthly basis, including balance sheets, income statements, and statements of cash flow for such months and, promptly after prepared, any other budgets or revised budgets prepared by the Company;

 

(f)                                   such other information relating to the financial condition, business, prospects, or corporate affairs of the Company as the Investors may from time to time reasonably request, including, but not limited to, information relating to the Company’s clinical trials and studies; provided, however, that the Company shall not be obligated under this Subsection 3.1 to provide information (i) that the Company reasonably determines in good faith to be a trade secret or confidential information (unless covered by an enforceable confidentiality agreement, in a form acceptable to the Company; the confidentiality obligations in Section 3.4 hereof are sufficient and acceptable for this purpose); or (ii) the disclosure of which would adversely affect the attorney-client privilege between the Company and its counsel.

 

Following the date of this Agreement, the Company shall promptly ensure that the annual financial statements for previously completed fiscal years are audited to the extent necessary to prepare and file a registration statement with the SEC. If, for any period, the Company has any subsidiary whose accounts are consolidated with those of the Company, then in respect of such period the financial statements delivered pursuant to the foregoing sections shall be the consolidated and consolidating financial statements of the Company and all such consolidated subsidiaries.

 

Notwithstanding anything else in this Subsection 3.1 to the contrary, the Company may cease providing the information set forth in this Subsection 3.1 during the period starting with the date thirty (30) days before the Company’s good-faith estimate of the date of filing of a registration statement if it reasonably concludes it must do so to comply with the SEC rules applicable to such registration statement and related offering; provided that the Company’s covenants under this Subsection 3.1 shall be reinstated at such time as the Company is no longer actively employing its commercially reasonable efforts to cause such registration statement to become effective.

 

The Company shall promptly and accurately respond, and shall use its commercially reasonable efforts to cause its transfer agent to promptly respond, to requests for information made on behalf of any T. Rowe Price Investor relating to (i) accounting or securities law matters required in connection with its audit or (ii) the actual holdings of the T. Rowe Price Investor, including in relation to the total outstanding shares; provided, however, that the Company shall not be obligated to provide any such information that could reasonably result in a violation of

 

16

 

applicable law or conflict with a confidentiality obligation of the Company.  On or prior to the effectiveness of the IPO, the Company shall provide each T. Rowe Price Investor written confirmation of its equity holdings in the Company (on an as-converted basis).

 

Notwithstanding anything to the contrary in the Prior Agreement, the Investors hereby waive any breach by the Company of the information rights provided in the Prior Agreement.

 

3.2                               Inspection.  The Company shall permit each Investor, at such Investor’s expense, to visit and inspect the Company’s properties; examine its books of account and records; and discuss the Company’s affairs, finances, and accounts with its officers, during normal business hours of the Company as may be reasonably requested by such Investor; provided, however, that the Company shall not be obligated pursuant to this Subsection 3.2 to provide access to any information that it reasonably and in good faith considers to be a trade secret or confidential information (unless covered by an enforceable confidentiality agreement, in form acceptable to the Company; the confidentiality obligations in Section 3.4 hereof are sufficient and acceptable for this purpose) or the disclosure of which would adversely affect the attorney-client privilege between the Company and its counsel.

 

3.3                               Termination of Information Rights.  The covenants set forth in Subsection 3.1 and Subsection 3.2 shall terminate and be of no further force or effect (i) immediately before the consummation of the IPO, or (ii) when the Company first becomes subject to the periodic reporting requirements of Section 12(g) or 15(d) of the Exchange Act, or (iii) upon a Liquidation Event (as such term is defined in the Company’s Restated Certificate), provided that such Liquidation Event results in consideration to the Investors consisting solely of cash proceeds and/or publicly traded securities, whichever event occurs first.

 

3.4                               Confidentiality.  Each Investor agrees that it will keep confidential and will not disclose, divulge, or use for any purpose (other than to monitor its investment in the Company) any confidential information obtained from the Company pursuant to the terms of this Agreement (including notice of the Company’s intention to file a registration statement), unless such confidential information (a) is known or becomes known to the public in general (other than as a result of a breach of this Subsection 3.4 by such Investor), (b) is or has been independently developed or conceived by such Investor without use of the Company’s confidential information, or (c) is or has been made known or disclosed to such Investor by a third party without a breach of any obligation of confidentiality such third party may have to the Company; provided, however, that an Investor may disclose confidential information (i) to its attorneys, accountants, consultants, and other professionals to the extent necessary to obtain their services in connection with monitoring its investment in the Company; (ii) to any prospective purchaser of any Registrable Securities from such Investor, if such prospective purchaser agrees to be bound by the provisions of this Subsection 3.4; (iii) to any Affiliate, partner, prospective partner, member, stockholder, or wholly owned subsidiary of such Investor in the ordinary course of business, provided that such Investor informs such Person that such information is confidential and directs such Person to maintain the confidentiality of such information; or (iv) as may otherwise be required by law, court order or an applicable governmental or regulatory body, provided that such Investor promptly notifies the Company of such disclosure and takes reasonable steps to minimize the extent of any such required disclosure.  Notwithstanding the foregoing, (A) in the case of any T. Rowe Price Investor, (B) in the case of Janus Global Life Sciences Fund, a series

 

17

 

of Janus Investment Fund, a Massachusetts Business Trust (the “Janus Fund”) and (C) in the case of RA Capital Healthcare Fund, L.P. (“RA Capital”), such T. Rowe Price Investor, the Janus Fund and RA Capital may identify the Company and the value of its respective security holdings in the Company in accordance with applicable investment reporting and disclosure regulations and respond to routine examinations, demands, requests or reporting requirements of a regulator without prior notice to or consent from the Company.

 

The Company understands and acknowledges that (1) in the regular course of a T. Rowe Price Investor’s business, such T. Rowe Price Investor may invest in companies that have issued securities that are publicly traded (each, a “Public Company”), (2) in the regular course of its business, the Janus Fund may invest in Public Companies, (3) in the regular course of its business, RA Capital may invest in Public Companies and (4) in the regular course of its business, Rock Springs Capital Master Fund LP (“Rock Springs”) may invest in Public Companies.  Accordingly, the Company covenants and agrees that before providing material non-public information about a Public Company (“Public Company Information”) (1) to a T. Rowe Price Investor, the Company will provide prior written notice to the following compliance personnel at such T. Rowe Price Investor describing such information in reasonable detail: Ryan Nolan, Vice President, ryan_nolan@troweprice.com, 410-345-6618, or in his absence to John Gilner, Chief Compliance Officer, john_gilner@troweprice.com, 410-345-2536, (2) to the Janus Fund, the Company will provide prior written notice to the following compliance personnel at the Janus Fund describing such information in reasonable detail: Janus Compliance — Steven Andersen, Senior Compliance Manager, steven.andersen@janus.com, 303-394-7358, or in his absence, David Kowalski, Chief Compliance Officer, david.kowalski@janus.com, 303-316-5747, (3) to RA Capital, the Company will provide prior written notice to the following compliance personnel at RA Capital describing such information in reasonable detail: Derek Meisner, General Counsel and Chief Compliance Officer, dmeisner@racap.com, with a copy to Nicholas McGrath, Corporate Counsel and Compliance Officer, nmcgrath@racap.com, and (4) to Rock Springs, the Company will provide prior written notice to the following compliance personnel at Rock Springs describing such information in reasonable detail: Graham McPhail, Managing Director, graham@rockspringscapital.com, 410-220-0127. The Company shall not disclose Public Company Information to any T. Rowe Price Investor, the Janus Fund or Rock Springs without written authorization from the applicable compliance personnel listed above, provided, however, that, the Company will be permitted to disclose agreements entered into with Public Companies in the ordinary course of business, such as routine customer, supplier, advertising and publishing agreements without such written authorization.

 

4.                                      Rights to Future Stock Issuances.

 

4.1                               Right of First Offer.  Subject to the terms and conditions of this Subsection 4.1 and applicable securities laws, if the Company proposes to offer or sell any New Securities, the Company shall first offer such New Securities to the Investors.  Each Investor shall be entitled to apportion the right of first offer hereby granted to it in such proportions as it deems appropriate, among (i) itself, (ii) its Affiliates and (iii) its beneficial interest holders, such as limited partners, members or any other Person having “beneficial ownership,” as such term is defined in Rule 13d-3 promulgated under the Exchange Act, of such Investor (“Investor Beneficial Owners”); provided that each such Affiliate or Investor Beneficial Owner agrees to enter into this Agreement as an “Investor”.

 

18

 

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

 

(b)                                 By written notification to the Company within twenty (20) days after the Offer Notice is given, each Investor may elect to purchase or otherwise acquire, at the price and on the terms specified in the Offer Notice, up to that portion of such New Securities which equals the proportion that the Common Stock then held by such Investor (including all shares of Common Stock then issuable (directly or indirectly) upon conversion and/or exercise, as applicable, of any Derivative Securities then held by such Investor) bears to the total Common Stock of the Company then outstanding (assuming full conversion and/or exercise, as applicable, of all Common Stock and other Derivative Securities).  The closing of any sale pursuant to this Subsection 4.1(b) shall occur within the later of sixty (60) days of the date that the Offer Notice is given and the date of initial sale of New Securities pursuant to Subsection 4.1(c).

 

(c)                                  If all New Securities referred to in the Offer Notice are not elected to be purchased or acquired as provided in Subsection 4.1(b), the Company may, during the ninety (90) day period following the expiration of the periods provided in Subsection 4.1(b), offer and sell the remaining unsubscribed portion of such New Securities 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 Offer Notice.  If the Company does not enter into an agreement for the sale of the New Securities within such period, or if such agreement is not consummated within sixty (60) days of the execution thereof, the right provided hereunder shall be deemed to be revived and such New Securities shall not be offered unless first reoffered to the Investors in accordance with this Subsection 4.1.

 

(d)                                 The right of first offer in this Subsection 4.1 shall not be applicable to (i) shares of Common Stock issued by reason of a dividend, stock split, split-up or other distribution on shares of Common Stock; (ii) shares of Common Stock or options issued to employees or directors of, or consultants or advisors to, the Company or any of its subsidiaries pursuant to a plan, agreement or arrangement approved by the Board of Directors of the Company; (iii) shares of Common Stock actually issued upon the exercise of options or shares of Common Stock actually issued upon the conversion or exchange of convertible securities, in each case provided such issuance is pursuant to the terms of such option or convertible security; (iv) shares of Common Stock issued to banks, equipment lessors or other financial institutions, or to real property lessors, pursuant to a debt financing, equipment leasing or real property leasing transaction approved by the Board of Directors of the Company; (v) shares of Common Stock issued pursuant to the acquisition of another corporation by the Company by merger, purchase of all or substantially all of the assets or other reorganization or to a joint venture agreement, provided that such issuances are approved by the Board of Directors of the Company; (vi) shares of Common Stock issued in connection with sponsored research, collaboration, technology license, development, OEM, marketing or other similar agreements or strategic partnerships approved by the Board of Directors of the Company; (vii) shares of Common Stock issued in the IPO; or (viii) the issuance of shares of Common Stock to Nationwide Children’s Hospital and/or The Ohio State University pursuant to the Company’s contractual obligations to Nationwide Children’s Hospital in effect as of the date hereof.  In addition, each Investor who is party to the

 

19

 

Prior Agreement hereby agrees and acknowledges that Section 4 of the Prior Agreement shall not be applicable to the issuance of any shares of Class D Common Stock pursuant to the Purchase Agreement (and hereby waives any and all notice requirements in connection therewith). Lastly, the Company shall not be obligated under this Subsection 4.1 to sell any securities to any Person, including but not limited the Investors, who does not qualify as an accredited investor (as such term is defined in Rule 501 as promulgated under the Securities Act) at the time of such offering or sale of New Securities.

 

(e)                                  Notwithstanding any provision hereof to the contrary, in lieu of complying with the provisions of this Subsection 4.1, the Company may elect to give notice to the Investors within thirty (30) days after the issuance of New Securities.  Such notice shall describe the type, price, and terms of the New Securities.  Each Investor shall have twenty (20) days from the date notice is given to elect to purchase up to the number of New Securities at the price per share such New Securities were sold for that would, if purchased by such Investor, maintain such Investor’s percentage-ownership position, calculated as set forth in Subsection 4.1(b) before giving effect to the issuance of such New Securities. The closing of such sale shall occur within sixty (60) days of the date notice is given to the Investors.

 

4.2                               Termination.  The covenants set forth in Subsection 4.1 shall terminate and be of no further force or effect (i) immediately before the consummation of the IPO, (ii) when the Company first becomes subject to the periodic reporting requirements of Section 12(g) or 15(d) of the Exchange Act, or (iii) upon a Liquidation Event, as such term is defined in the Company’s Restated Certificate, whichever event occurs first.

 

5.                                      Additional Covenants.

 

5.1                               Board Matters.  Unless otherwise determined by the vote of a majority of the directors then in office, the Board of Directors shall meet at least quarterly in accordance with an agreed-upon schedule.  The Company shall reimburse the nonemployee directors for all reasonable out-of-pocket travel expenses incurred (consistent with the Company’s travel policy) in connection with attending meetings of the Board of Directors.

 

5.2                               Right of Co-Sale.

 

(a)                                 Exercise of Right.  If any Common Stock is proposed to be sold by any Key Holder to a Prospective Transferee prior to the closing of the IPO, such Key Holder shall provide a Proposed Transfer Notice to each Investor and the Company and each Investor may elect to exercise its Right of Co-Sale and participate in the Proposed Key Holder Transfer as set forth in Subsection 5.2(b) below and, subject to Subsection 5.2(d), otherwise on the same terms and conditions specified in the Proposed Transfer Notice. An Investor, if it desires to exercise its Right of Co-Sale, must give the selling Key Holder written notice to that effect within fifteen (15) days after receipt of the Proposed Transfer Notice from the selling Key Holder, and upon giving such notice such Investor shall be deemed to have effectively exercised the Right of Co-Sale.

 

(b)                                 Shares Includable.  Each Investor may include in the Proposed Key Holder Transfer that number of shares of such Investor’s Common Stock equal to (i) the percentage of the total number of issued and outstanding shares of Common Stock of the

 

20

 

Company held by such Investor multiplied by (ii) the number of shares of Common Stock proposed to be sold by the selling Key Holder to the Prospective Transferee.

 

(c)                                  Purchase and Sale Agreement.  Each Investor and the selling Key Holder agree that the terms and conditions of any Proposed Key Holder Transfer in accordance with Section 5.2 will be memorialized in, and governed by, a written purchase and sale agreement with the Prospective Transferee (the “Purchase and Sale Agreement”) with customary terms and provisions for such a transaction, and each Investor and the selling Key Holder further covenant and agree to enter into such Purchase and Sale Agreement as a condition precedent to any sale or other transfer in accordance with this Section 5.2.

 

(d)                                 Allocation of Consideration.

 

(i)                                     Subject to Subsection 5.2(d)(ii), the aggregate consideration payable to each Investor and the selling Key Holder shall be allocated based on the number of shares of Common Stock sold to the Prospective Transferee by each Investor and the selling Key Holder.

 

(ii)                                  In the event that the Proposed Key Holder Transfer constitutes a Change of Control, the terms of the Purchase and Sale Agreement shall provide that the aggregate consideration from such transfer shall be allocated to each Investor and the selling Key Holder in accordance with the Restated Certificate as if (A) such transfer were a Liquidation Event (as defined in the Restated Certificate), and (B) the Common Stock sold in accordance with the Purchase and Sale Agreement were the only Common Stock outstanding.

 

(e)                                  Purchase by Selling Key Holder; Deliveries.  Notwithstanding Subsection 5.2(c) above, if any Prospective Transferee refuses to purchase securities subject to the Right of Co-Sale from an Investor or upon the failure to negotiate in good faith a Purchase and Sale Agreement satisfactory to the Investor(s) exercising the Right of Co-Sale, no Key Holder may sell any Common Stock to such Prospective Transferee unless and until, simultaneously with such sale, such Key Holder purchases all securities subject to the Right of Co-Sale from each Investor exercising the Right of Co-Sale on the same terms and conditions (including the proposed purchase price) as set forth in the Proposed Transfer Notice and as provided in Subsection 5.2(d)(i); provided, however, if such sale constitutes a Change of Control, the portion of the aggregate consideration paid by the selling Key Holder to each Investor exercising the Right of Co-Sale shall be made in accordance with the first sentence of Subsection 5.2(d)(ii).  In connection with such purchase by the selling Key Holder, each Investor exercising the Right of Co-Sale shall deliver to the selling Key Holder any stock certificate or certificates, properly endorsed for transfer, representing the Common Stock being purchased by the selling Key Holder (or request that the Company effect such transfer in the name of the selling Key Holder).  Any such shares transferred to the selling Key Holder will be transferred to the Prospective Transferee against payment therefor in consummation of the sale of the Common Stock pursuant to the terms and conditions specified in the Proposed Transfer Notice, and the selling Key Holder shall concurrently therewith remit or direct payment to each Investor exercising the Right of Co-Sale the portion of the aggregate consideration to which such Investor is entitled by reason of its participation in such sale as provided in this Subsection 5.2(e).

 

21

 

(f)                                   Additional Compliance.  If any Proposed Key Holder Transfer is not consummated within forty-five (45) days after receipt of the Proposed Transfer Notice by the Company, the Key Holders proposing the Proposed Key Holder Transfer may not sell any Common Stock unless they first comply in full with each provision of this Section 5.2.  The exercise or election not to exercise any right by an Investor hereunder shall not adversely affect its right to participate in any other sales of Common Stock subject to this Subsection 5.2.

 

5.3                               Effect of Failure to Comply with Co-Sale Rights.

 

(a)                                 Transfer Void; Equitable Relief.  Any Proposed Key Holder Transfer not made in compliance with the requirements of this Agreement shall be null and void ab initio, shall not be recorded on the books of the Company or its transfer agent and shall not be recognized by the Company.  Each party hereto acknowledges and agrees that any breach of this Agreement would result in substantial harm to the other parties hereto for which monetary damages alone could not adequately compensate.  Therefore, the parties hereto unconditionally and irrevocably agree that any non-breaching party hereto shall be entitled to seek protective orders, injunctive relief and other remedies available at law or in equity (including, without limitation, seeking specific performance or the rescission of purchases, sales and other transfers of Common Stock not made in strict compliance with this Agreement).

 

(b)                                 Violation of Co-Sale Right.  If any Key Holder purports to sell any Common Stock in contravention of the Right of Co-Sale (a “Prohibited Transfer”), each Investor may, in addition to such remedies as may be available by law, in equity or hereunder, require such Key Holder to purchase from such Investor the type and number of shares of Common Stock that such Investor would have been entitled to sell to the Prospective Transferee had the Prohibited Transfer been effected in compliance with the terms of Subsection 5.2.  The sale will be made on the same terms, including, without limitation, as provided in Subsection 5.2(d)(i) and the first sentence of Subsection 5.2(d)(ii), as applicable, and subject to the same conditions as would have applied had the Key Holder not made the Prohibited Transfer, except that the sale (including, without limitation, the delivery of the purchase price) must be made within ninety (90) days after an Investor learns of the Prohibited Transfer, as opposed to the timeframe proscribed in Subsection 5.2.  Such Key Holder shall also reimburse each Investor for any and all reasonable and documented out-of-pocket fees and expenses, including reasonable legal fees and expenses, incurred pursuant to the exercise or the attempted exercise of such Investor’s rights under Subsection 5.2.

 

5.4                                                 Drag-Along Right.

 

(a)                              If both (a) the holders of a majority of the issued and outstanding shares of Common Stock (voting together as a single class on an as-converted basis) and (b) the holders of a majority of the issued and outstanding shares of Class D Common Stock (each voting as a separate class) approve a sale of the Company or all or substantially all of the Company’s assets, whether by means of a merger, consolidation, the sale of capital stock, or otherwise (an “Approved Sale”), then each Investor and the Key Holder hereby agrees to consent to, vote for and raise no objections to the Approved Sale, and (i) shall each waive any and all dissenters rights, appraisal rights or similar rights in connection with such Approved Sale, or (ii) if the Approved Sale is structured as a sale of the outstanding capital stock of the

 

22

 

Company, each Investor and Key Holder hereby agrees to sell his, her or its Common Stock on the terms and conditions approved by the stockholders described in subclauses (a) and (b) above (the “Approving Stockholders”). Each Investor and Key Holder agrees to take all necessary and desirable actions approved by the Approving Stockholders in connection with the consummation of an Approved Sale, including the execution of such agreements and such instruments and other actions reasonably necessary to (A) provide the representations, warranties, indemnities, covenants, conditions, escrow agreements and other provisions and agreements relating to such Approved Sale, provided that such representations, warranties and covenants are made solely by each Investor or Key Holder for his, her or its own account; and (B) effectuate the allocation and distribution of the aggregate consideration upon the consummation of the Approved Sale. Notwithstanding any provision of this Section 5.4 to the contrary, the Investors and the Key Holders shall have no obligation under this Section 5.4 unless the aggregate consideration payable upon the consummation of the Approved Sale is to be allocated and distributed in accordance with Article Fourth, Subsection B.2 of the Company’s Restated Certificate; each T. Rowe Price Investor shall have no obligation under this Section 5.4 unless the Approved Sale provides for payment at closing sufficient to return the Class D Original Issue Price (as such term is defined in the Restated Certificate) on each share of Class D Common Stock; Deerfield and Roche shall have no obligation under this Section 5.4 unless the Approved Sale provides for payment at closing sufficient to return the Class C Original Issue Price (as such term is defined in the Restated Certificate) on each share of Class C Common Stock; and PBM and the PBM Co-Investors shall have no obligation under this Section 5.4 unless the Approved Sale provides for payment at closing sufficient to return the Class B Original Issue Price (as such term is defined in the Restated Certificate) on each share of Class B Common Stock.

 

(b)                                 Exceptions.  Notwithstanding the foregoing, an Investor or Key Holder, as applicable, will not be required to comply with Subsection 5.4(a) above in connection with any Approved Sale unless:

 

(i)                                     any representations and warranties to be made by such Investor or Key Holder, as applicable, in connection with the Approved Sale are limited to representations and warranties related to authority, ownership and the ability to convey title to such shares, including, but not limited to, representations and warranties that (i) such Investor or Key Holder holds all right, title and interest in and to the shares such Investor or Key Holder purports to hold, free and clear of all liens and encumbrances, (ii) the obligations of the Investor or Key Holder in connection with the transaction have been duly authorized, if applicable, (iii) the documents to be entered into by the Investor or Key Holder have been duly executed by the Investor or Key Holder and delivered to the acquirer and are enforceable against the Investor or Key Holder in accordance with their respective terms; and (iv) neither the execution and delivery of documents to be entered into in connection with the transaction, nor the performance of the Investor or Key Holder’s obligations thereunder, will cause a breach or violation of the terms of any agreement, law or judgment, order or decree of any court or governmental agency;

 

(ii)                                  the liability for indemnification, if any, of such Investor or Key Holder in the Approved Sale and for the inaccuracy of any representations and warranties made by the Company or its stockholders in connection with such Approved Sale, is several and not joint with any other Person (except to the extent that funds may be paid out of an escrow established to cover breach of representations, warranties and covenants of the Company as well

 

23

 

as breach by any stockholder of any of identical representations, warranties and covenants provided by all stockholders), and is pro rata in proportion to, and does not exceed, the amount of consideration paid to such Investor or Key Holder in connection with such Approved Sale; and

 

(iii)                               liability shall be limited to such Investor’s or Key Holder’s (as applicable) applicable share (determined based on the respective proceeds payable to each Investor or Key Holder, as applicable, in connection with such Approved Sale in accordance with the provisions of the Restated Certificate) of a negotiated aggregate indemnification amount that applies equally to all Investors and Key Holders but that in no event exceeds the amount of consideration otherwise payable to such Investor or Key Holder, as applicable, in connection with such Approved Sale, except with respect to claims related to fraud by such Investor or Key Holder, as applicable, the liability for which need not be limited as to such Investor or Key Holder, as applicable.

 

5.5                                                 Board of Directors.

 

(a)                                 Number of Directors. Each Investor and Key Holder agrees to vote, or cause to be voted all shares owned by such Investor or Key Holder, from time to time and at all times, in whatever manner as shall be necessary to ensure that the size of the Board shall be set and remain at seven (7) directors or such other number of directors (but no more than eight (8)), as is determined by the Board.

 

(b)                                 CEO Director. Each Investor and Key Holder agrees to vote, or cause to be voted, all shares owned by such Investor or Key Holder, from time to time and at all times, in whatever manner as shall be necessary to ensure the Company’s Chief Executive Officer, which position shall initially be vacant, is elected to the Company’s Board of Directors (the “CEO Director”), provided, that if for any reason, the CEO Director shall cease to serve as the Chief Executive Officer of the Company, each Investor and Key Holder shall promptly vote their respective shares (i) to remove the former Chief Executive Officer from the Board of Directors and (ii) to elect such person’s replacement as Chief Executive Officer of the Company as the new CEO Director.

 

(c)                                  Class A Director.  The Key Holders and the other Investors hereby agree that the holders of a majority of the Class A Common Stock shall have the right to nominate one candidate for election to the Company’s Board of Directors; (b) the Key Holders and the other Investors further agree that if the service of any director that was nominated by the holders of a majority of the Class A Common Stock is terminated, whether by reason of such director’s resignation, death, disability or otherwise, that the holders of a majority of the Class A Common Stock shall have the right to nominate a candidate for election to the Company’s Board of Directors to replace such director; (c) each Key Holder and other Investor hereby agrees to vote, at any annual or special meeting of the stockholders of the Company at which an election of directors is to occur (which shall include any consent of stockholders of the Company in lieu of any such meeting), all shares owned by such Investor or Key Holder in favor of the election of the holders of a majority of the Class A Common Stock’s candidate to the Company’s Board of Directors; and (d) each Key Holder and other Investor hereby agrees not to vote to remove the holders of a majority of the Class A Common Stock’s candidate from the Company’s Board of

 

24

 

Directors unless so directed by the holders of a majority of the Class A Common Stock, and to so vote if so directed by the holders of a majority of the Class A Common Stock. The holders of a majority of the Class A Common Stock’s initial nominee shall be John D. Harkey, Jr.

 

(d)                                 Class B Director. For so long as PBM and the PBM Co-Investors hold not less than seven hundred and thirty-three thousand one hundred and thirty-eight (733,138) shares of Class B Common Stock or shares of capital stock issued upon conversion of the Class B Common Stock (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class B Common Stock), (a) the Key Holders and the other Investors hereby agree that PBM shall have the right to nominate one candidate for election to the Company’s Board of Directors; (b) the Key Holders and the other Investors further agree that if the service of any director that was nominated by PBM is terminated, whether by reason of such director’s resignation, death, disability or otherwise, that PBM shall have the right to nominate a candidate for election to the Company’s Board of Directors to replace such director; (c) each Key Holder and other Investor hereby agrees to vote, at any annual or special meeting of the stockholders of the Company at which an election of directors is to occur (which shall include any consent of stockholders of the Company in lieu of any such meeting), all shares owned by such Investor or Key Holder in favor of the election of PBM’s candidate to the Company’s Board of Directors; and (d) each Key Holder and other Investor hereby agrees not to vote to remove PBM’s candidate from the Company’s Board of Directors unless so directed by PBM, and to so vote if so directed by PBM.

 

(e)                                  Class C Director. For so long as Deerfield or Roche hold not less than two hundred and twenty-eight thousand seven hundred and twenty-four (228,724) shares of Class C Common Stock or shares of capital stock issued upon conversion of such Class C Common Stock (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class C Common Stock), (a) the Key Holders and the other Investors hereby agree that Deerfield shall have the right to nominate two candidates for election to the Company’s Board of Directors; (b) the Key Holders and the other Investors further agree that if the service of any director that was nominated by Deerfield is terminated, whether by reason of such director’s resignation, death, disability or otherwise, that Deerfield shall have the right to nominate a candidate for election to the Company’s Board of Directors to replace such director; (c) each Key Holder and Investor hereby agrees to vote, at any annual or special meeting of the stockholders of the Company at which an election of directors is to occur (which shall include any consent of stockholders of the Company in lieu of any such meeting), all shares owned by such Investor or Key Holder in favor of the election of Deerfield’s candidates to the Company’s Board of Directors; and (d) each Key Holder and other Investor hereby agrees not to vote to remove any of Deerfield’s candidates from the Company’s Board of Directors unless so directed by Deerfield, and to so vote if so directed by Deerfield. Deerfield’s initial nominees as Class C Directors shall be Jonathan Leff and Carole Nuechterlein; in the event that either or both of Jonathan Leff or Carole Neuchterlein are unwilling or unable to serve as the Class C Director, Deerfield’s replacement nominee(s) must be approved by a majority of the members of the Board of Directors then serving, such approval not to be unreasonably withheld or delayed.

 

(f)                                   Observer Rights.  For so long as the T. Rowe Price Investors collectively own not less than one hundred seventy-two thousand four hundred thirteen

 

25

 

(172,413) shares of Class D Common Stock or shares of capital stock issued upon conversion of such Class D Common Stock (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class D Common Stock), the Company shall invite a representative of the T. Rowe Price Investors to attend all meetings of the Board of Directors, including executive sessions, in a nonvoting observer capacity and, in this respect, shall give such representative copies of all materials provided to the Board of Directors and board committees; provided, however, that the Company reserves the right to withhold any information and to exclude such representative from any meeting or portion thereof if the Board of Directors determines in good faith that such withholding of information or exclusion is necessary to preserve the attorney-client privilege, to protect highly confidential proprietary information, or for other similar reasons.

 

(g)                                  Committees.  The Company shall cause to be established, and will maintain, such committees as the Board of Directors deems necessary or appropriate, but at a minimum will establish a compensation committee which shall consist of three (3) non-management directors, one of which shall be a Class C Director and one of which shall be the Class B Director. Each Board Committee shall include at least one of the Class C Directors, unless participation in such committee has been waived by the Class C Directors.  Each Board Committee shall include at least the Class B Director, unless participation in such committee has been waived by the Class B Director.

 

(h)                              Irrevocable Proxy.  To secure the Key Holders’ obligations to vote their respective shares in accordance with this Agreement, each Key Holder hereby appoints the Chairman of the Board of Directors and the Chief Executive Officer of the Company, or either of them from time to time, or their designees, as such Key Holder’s true and lawful proxy and attorney, with the power to act alone and with full power of substitution, to vote all of such shares as set forth in this Agreement and to execute all appropriate instruments consistent with this Agreement on behalf of such Key Holder if, and only if, such Key Holder fails to vote all of such Key Holder’s shares or execute such other instruments in accordance with the provisions of this Agreement.  The proxy and power granted by each Key Holder pursuant to this Section are coupled with an interest and are given to secure the performance of such party’s duties under this Agreement.  Each such proxy and power will be irrevocable for the term hereof.  The proxy and power, so long as any party hereto is an individual, will survive the death, incompetency and disability of such party, as the case may be, and, so long as any party hereto is an entity, will survive the merger or reorganization of such party.

 

5.6                               PBM Protective Provisions. For so long as PBM and the PBM Co-Investors holds not less than seven hundred and thirty-three thousand one hundred and thirty-eight (733,138) shares of Class B Common Stock or shares of capital stock issued upon conversion of the Class B Common Stock (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class B Common Stock), the Corporation shall not do, either directly or indirectly by amendment, merger, consolidation or otherwise, and the Key Holders agree not to vote to approve, any of the following without (in addition to any other vote required by law or the Restated Certificate) the written consent or affirmative vote (as the case may be) of PBM, given in writing or by vote at a meeting:

 

26

 

(a)                                 amend, alter or repeal any provision of the Restated Certificate or Bylaws of the Corporation regarding the powers, preferences or rights of the Class B-1 Common Stock or Class B-2 Common Stock, or in a manner that adversely affects the powers, preferences or rights of the Class B-1 Common Stock or Class B-2 Common Stock; or

 

(b)                                 liquidate, dissolve or wind-up the business and affairs of the Corporation, effect any Liquidation Event, or consent to any of the foregoing, unless such action results in an amount paid per share of Class B-1 Common Stock equal to at least $6.82 (subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class B-1 Common Stock).

 

5.7                               Class C Common Stock Protective Provisions. For so long as Deerfield or Roche hold not less than two hundred and twenty-eight thousand seven hundred and twenty-four (228,724) shares of Class C Common Stock or shares of capital stock issued upon conversion of the Class C Common Stock (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class C Common Stock), the Corporation shall not do, either directly or indirectly by amendment, merger, consolidation or otherwise, and the Key Holders agree not to vote to approve, any of the following without (in addition to any other vote required by law or the Restated Certificate) the written consent or affirmative vote (as the case may be) of the holders of at least 60% of the issued and outstanding shares of Class C Common Stock, given in writing or by vote at a meeting:

 

(a)                                 amend, alter or repeal any provision of the Restated Certificate or Bylaws of the Corporation in a manner that adversely affects the powers, preferences, privileges or rights of the Class C Common Stock or the restrictions provided for the benefit of Deerfield or the Class C Common Stock; or

 

(b)                                 authorize or issue any additional shares of Class C Common Stock.

 

5.8                               Insurance.  The Company has 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 will use commercially reasonable efforts to cause such insurance policy to be maintained until such time as the Board of Directors determines that such insurance should be discontinued. This policy shall not be cancelable by the Company without prior approval by the Board of Directors.  Notwithstanding any other provision of this Section 5.8 to the contrary, for so long as a Class C Director is serving on the Board of Directors, the Company shall not cease to maintain a directors and officers liability insurance policy in an amount of at least five million dollars ($5,000,000) unless approved by such Class C Director(s), and the Company shall annually, within one hundred twenty (120) days after the end of each fiscal year of the Company, deliver to Deerfield a certification that such a directors and officers liability insurance policy remains in effect.

 

5.9                               Termination of Covenants.  The covenants set forth in this Section 5 shall terminate and be of no further force or effect (i) immediately before the consummation of the IPO; (ii) when the Company first becomes subject to the periodic reporting requirements of

 

27

 

Section 12(g) or 15(d) of the Exchange Act; or (iii) upon a Liquidation Event, as such term is defined in the Company’s Restated Certificate, whichever event occurs first.

 

6.                                      Miscellaneous.

 

6.1                               Successors and Assigns.  The rights under this Agreement may be assigned (but only with all related obligations) by a Holder to a transferee of Registrable Securities; provided, however, that (v) the Company is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee and the Registrable Securities with respect to which such rights are being transferred; (w) such transferee agrees in a written instrument delivered to the Company to be bound by and subject to the terms and conditions of this Agreement; (x) except for transfers of Registrable Securities by PBM to the PBM Co-Investors, PBM may only transfer its rights hereunder to an unrelated third party transferee if such unrelated third party transferee receives not less than 366,569 shares (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class B Common Stock) of PBM’s Class B Common Stock; (y) Deerfield may only transfer its rights hereunder to an unrelated third party transferee if such unrelated third party transferee receives not less than two hundred and twenty-eight thousand seven hundred and twenty-four (228,724) shares (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class C Common Stock) of Deerfield’s Class C Common Stock; and (z) Roche may only transfer its rights hereunder to an unrelated third party transferee if such unrelated third party transferee receives not less than two hundred twenty-eight thousand four hundred and eighty (228,480) shares (such number subject to appropriate adjustment in the event of any stock dividend, stock split, combination or other similar recapitalization with respect to the Class C Common Stock) of Roche’s Class C Common Stock.  The terms and conditions of this Agreement inure to the benefit of and are binding upon the respective successors and permitted assignees of the parties.  Nothing in this Agreement, express or implied, is intended to confer upon any party other than the parties hereto or their respective successors and permitted assignees any rights, remedies, obligations or liabilities under or by reason of this Agreement, except as expressly provided herein.

 

6.2                               Governing Law.  This Agreement shall be governed by the internal law of the State of Delaware.

 

6.3                               Counterparts.  This Agreement may be executed in two (2) or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.  Counterparts may be delivered via facsimile, electronic mail or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes.

 

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

 

6.5                               Notices.  All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given upon the earlier of actual receipt or: (i) personal delivery to the party to be notified, (ii) when sent, if sent by

 

28

 

electronic mail or facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, provided that in either case it is followed promptly by a confirming copy of the notice given via another authorized means for that recipient, (iii) five (5) days after having been sent to a U.S. address by registered or certified mail, return receipt requested, postage prepaid, addressed to the party to be notified at such party’s address as set forth in this section or on Schedule A hereto, or as subsequently modified by written notice, and if to the Company, (iv) two (2) business days after deposit with a nationally recognized overnight courier, freight prepaid for delivery to a U.S. address, specifying next business day delivery, with written verification of receipt, or (v) three (3) business days after deposit with an internationally recognized expedited delivery services company, freight prepaid for deliver to a non-U.S. address, specifying next available business day delivery, with written verification of receipt; provided, however, that notice and other communications given or made to Roche Finance Ltd shall only be provided using the methods set forth in clauses (i), (ii) and (v) above.

 

	
If to the   Company:
    	
AveXis, Inc.

4925 Greenville   Avenue, Suite 604

Dallas, Texas   75206

Attn: Sean P. Nolan

Fax:

Email:   snolan@AveXisBio.com
    
	
 
    	
 
    
	
With   a simultaneous copy (which shall not constitute notice) to:
    	
Cooley   LLP

1114   Avenue of the Americas

New   York, NY 10036-7798

Attn:   Divakar Gupta

Fax:   1 212 479 6275

Email:   dgupta@cooley.com
    
	
 
    	
 
    
	
If to any T. Rowe Price Investor:
    	
T. Rowe Price Associates, Inc.

100 East Pratt Street

Baltimore, MD 21202

Attn: Andrew Baek, Vice President

Phone: 410-345-2090

E-mail: andrew_baek@troweprice.com
    

 

Any notice to Roche or Deerfield should be sent to these addresses:

 

	
If to Roche:
    	
Roche Finance   Ltd

Grenzacherstrasse   122

4070 Basel,   Switzerland

Fax: + 41 61 687 0644

Attn: Roche Venture Fund, Carole   Nuechterlein
    

 

29

 

	
With a simultaneous copy (which shall not   constitute notice) to:
    	
Hoffmann-La Roche Inc.

Overlook at Great Notch

150 Clove Road

8th Floor — Suite 8

Little Falls, NJ 07424

Attn: General Counsel
    
	
 
    	
 
    
	
If to Deerfield:
    	
Deerfield Capital

780 Third Avenue

New York, NY 10017

Attn: Lawrence Atinsky
    
	
 
    	
 
    
	
With a simultaneous copy (which shall not   constitute notice) to:
    	
Choate Hall & Stewart LLP

Two International Place

Boston, MA 02110

Attn: Frederick Callori
    

 

6.6                               Amendments and Waivers.  Any term of this Agreement may be amended and the observance of any term of this Agreement may be waived (either generally or in a particular instance, and either retroactively or prospectively) only with the written consent of the Company and the holders of a majority of the Registrable Securities then outstanding; provided that the Company may in its sole discretion waive compliance with Subsection 2.12(c); and provided further that any provision hereof may be waived by any waiving party on such party’s own behalf, without the consent of any other party.  Notwithstanding the foregoing, (i) this Agreement may not be amended or terminated and the observance of any term hereof may not be waived with respect to an Investor without the written consent of such Investor, (ii) Sections 5.5(a), 5.5(d) and 5.6 may not be amended or revised without the consent of PBM, (iii) Sections 5.5(a), 5.5(e), and 5.7 may not be amended or revised without the consent of the holders of at least a majority of the Class C Common Stock and (iv) Sections 2.11, 3.1, 3.2, 3.3, 3.4 and 5.5(f) may not be amended or revised in a manner that adversely affects the T. Rowe Price Investors without the written consent of T. Rowe Price Investors holding at least a majority of the Class D Common Stock held by all T. Rowe Price Investors. The Company shall give prompt notice of any amendment or termination hereof or waiver hereunder to any party hereto that did not consent in writing to such amendment, termination, or waiver.  Any amendment, termination, or waiver effected in accordance with this Subsection 6.6 shall be binding on all parties hereto, regardless of whether any such party has consented thereto. No waivers of or exceptions to any term, condition, or provision of this Agreement, in any one or more instances, shall be deemed to be or construed as a further or continuing waiver of any such term, condition, or provision.

 

6.7                               Acknowledgement. Notwithstanding anything to the contrary stated herein and for the avoidance of doubt, for any stockholder who is party to this Agreement as both an Investor and a Key Holder, such stockholder shall only be a Key Holder with respect to such class of Common Stock as set forth on Schedule B hereto and only the shares of Common Stock set forth immediately underneath such stockholder’s name on Schedule B shall be subject to any

 

30

 

of the obligations, restrictions and requirements associated with the shares held by Key Holders under this Agreement.

 

6.8                               Severability.  In case any one or more of the provisions contained in this Agreement is for any reason held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality, or unenforceability shall not affect any other provision of this Agreement, and such invalid, illegal, or unenforceable provision shall be reformed and construed so that it will be valid, legal, and enforceable to the maximum extent permitted by law.

 

6.9                               Entire Agreement.  This Agreement (including any Schedules and Exhibits hereto) constitutes the full and entire understanding and agreement among the parties with respect to the subject matter hereof, and any other written or oral agreement relating to the subject matter hereof existing among the parties (excluding but not limited to the Prior Agreement) is expressly canceled.

 

6.10                        Dispute Resolution.  The parties (a) hereby exclusively, irrevocably and unconditionally submit to the jurisdiction of the state and federal courts of situated in the State of Delaware for the purpose of any suit, action or other proceeding arising out of or based upon this Agreement, (b) agree not to commence any suit, action or other proceeding arising out of or based upon this Agreement except in such courts, and (c) hereby waive, and agree not to assert, by way of motion, as a defense, or otherwise, in any such suit, action or proceeding, any claim that it is not subject personally to the jurisdiction of the above-named courts, that its property is exempt or immune from attachment or execution, that the suit, action or proceeding is brought in an inconvenient forum, that the venue of the suit, action or proceeding is improper or that this Agreement or the subject matter hereof may not be enforced in or by such court.

 

WAIVER OF JURY TRIAL: EACH PARTY HEREBY WAIVES ITS RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS AGREEMENT, THE OTHER TRANSACTION DOCUMENTS, THE SECURITIES OR THE SUBJECT MATTER HEREOF OR THEREOF.  THE SCOPE OF THIS WAIVER IS INTENDED TO BE ALL-ENCOMPASSING OF ANY AND ALL DISPUTES THAT MAY BE FILED IN ANY COURT AND THAT RELATE TO THE SUBJECT MATTER OF THIS TRANSACTION, INCLUDING, WITHOUT LIMITATION, CONTRACT CLAIMS, TORT CLAIMS (INCLUDING NEGLIGENCE), BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW AND STATUTORY CLAIMS.  THIS SECTION HAS BEEN FULLY DISCUSSED BY EACH OF THE PARTIES HERETO AND THESE PROVISIONS WILL NOT BE SUBJECT TO ANY EXCEPTIONS.  EACH PARTY HERETO HEREBY FURTHER WARRANTS AND REPRESENTS THAT SUCH PARTY HAS REVIEWED THIS WAIVER WITH ITS LEGAL COUNSEL, AND THAT SUCH PARTY KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL COUNSEL.

 

6.11                        Delays or Omissions.  No delay or omission to exercise any right, power, or remedy accruing to any party under this Agreement, upon any breach or default of any other party under this Agreement, shall impair any such right, power, or remedy of such nonbreaching or nondefaulting party, nor shall it be construed to be a waiver of or acquiescence to any such breach or default, or to any similar breach or default thereafter occurring, nor shall any waiver of

 

31

 

any single breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring.  All remedies, whether under this Agreement or by law or otherwise afforded to any party, shall be cumulative and not alternative.

 

[Remainder of Page Intentionally Left Blank]

 

32

 

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

 

	
COMPANY:
    	
 
    
	
 
    	
 
    
	
AVEXIS, INC.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Sean Nolan
    	
 
    
	
Name:
    	
Sean   Nolan
    	
 
    
	
Its:
    	
Chief   Executive Officer
    	
 
    

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
T. Rowe Price Health   Sciences Fund, Inc.
    	
 
    
	
TD Mutual Funds — TD   Health Sciences Fund
    	
 
    
	
VALIC Company I —   Health Sciences Fund
    	
 
    
	
T. Rowe Price Health   Sciences Portfolio
    	
 
    
	
John Hancock Variable   Insurance Trust — Health Sciences Trust
    	
 
    
	
John Hancock Funds II —   Health Sciences Fund
    	
 
    
	
Each   fund, severally and not jointly
    	
 
    
	
 
    	
 
    
	
By: T. Rowe Price Associates, Inc., Investment   Adviser or Subadviser, as applicable
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Taymour Tamaddon
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Taymour Tamaddon
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Vice President
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
T. Rowe Price New   Horizons Fund, Inc.
    	
 
    
	
T. Rowe Price New   Horizons Trust
    	
 
    
	
T. Rowe Price U.S.   Equities Trust
    	
 
    
	
Each   fund, severally and not jointly
    	
 
    
	
 
    	
 
    
	
By: T. Rowe Price   Associates, Inc., Investment Adviser
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Taymour Tamaddon
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Taymour Tamaddon
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Vice President
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
T. Rowe Price Associates, Inc.
    	
 
    
	
 
    	
100 East Pratt Street
    	
 
    
	
 
    	
Baltimore, MD 21202
    	
 
    
	
 
    	
Attn: Andrew Baek, Vice   President and Senior
    	
 
    
	
 
    	
Legal Counsel
    	
 
    
	
 
    	
Phone: 410-345-2090
    	
 
    
	
 
    	
E-mail:   andrew_baek@troweprice.com
    	
 
    
				

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
PBM   CAPITAL INVESTMENTS, LLC
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Russell T.   Schundler
    	
 
    
	
Name:
    	
Russell T. Schundler
    	
 
    
	
Title:
    	
Executive Vice   President
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
200 Garrett Street,   Suite S
    	
 
    
	
 
    	
Charlottesville,   VA 22902
    	
 
    

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
PBM   CAPITAL INVESTMENTS, LLC
    	
 
    
	
As   attorney-in-fact for the PBM Co-Investors
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Russell T.   Schundler
    	
 
    
	
Name:
    	
Russell T. Schundler
    	
 
    
	
Title:
    	
Executive Vice President
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
200 Garrett Street,   Suite S
    	
 
    
	
 
    	
Charlottesville,   VA 22902
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
PBM   CO-INVESTORS:
    	
 
    
	
 
    	
 
    
	
Adam   Burke
    	
 
    
	
Kevin   Combs
    	
 
    
	
Damian   deGoa
    	
 
    
	
Steven   Goldman
    	
 
    
	
Mike   McCauley
    	
 
    
	
James   Reebals
    	
 
    
	
Jayson   Reiger
    	
 
    
	
Eugene   Scavola
    	
 
    
	
Russell   Schundler
    	
 
    
	
Sean   Stalfort
    	
 
    

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
DEERFIELD   PRIVATE DESIGN FUND III, L.P.
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
Deerfield   Mgmt III, L.P.
    	
 
    
	
 
    	
General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
J.E.   Flynn Capital III, LLC
    	
 
    
	
 
    	
 
    	
 General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Name:   David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Title:    Authorized   Signatory
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Address:   Deerfield Capital, 780 Third Avenue
    	
 
    
	
New   York, NY 10017
    	
 
    
	
Attn:   Lawrence Atinsky
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
DEERFIELD   SPECIAL SITUATIONS FUND, L.P.
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
Deerfield   Mgmt, L.P.
    	
 
    
	
 
    	
General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
J.E.   Flynn Capital, LLC
    	
 
    
	
 
    	
 
    	
General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Name:   David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Title:   Authorized   Signatory
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Address:   Deerfield Capital, 780 Third Avenue
    	
 
    
	
New   York, NY 10017
    	
 
    
	
Attn:   Lawrence Atinsky
    	
 
    

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
ROCHE   FINANCE LTD
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Carole Nuechterlein
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Carole Nuechterlein
    	
 
    
	
 
    	
 
    	
 
    
	
Its:
    	
authorized signatory
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Andreas Knierzinger
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Andreas Knierzinger
    	
 
    
	
 
    	
 
    	
 
    
	
Its:
    	
authorized signatory
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
VENROCK   HEALTHCARE CAPITAL PARTNERS II, L.P.
    	
 
    
	
By:   VHCP Management II, LLC
    	
 
    
	
Its:   General Partner
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ David L. Stepp
    	
 
    
	
Name:
    	
David L. Stepp
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
3340 Hillview Avenue
    	
 
    
	
 
    	
Palo Alto, CA 94304
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
VHCP   CO-INVESTMENT HOLDINGS II, LLC
    	
 
    
	
By:   VHCP Management II, LLC
    	
 
    
	
Its:   Manager
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ David L. Stepp
    	
 
    
	
Name:
    	
David L. Stepp
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
3340 Hillview Avenue
    	
 
    
	
 
    	
Palo Alto, CA 94304
    	
 
    

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Janus   Global Life Sciences Fund, a series of
    	
 
    
	
Janus   Investment Fund, a Massachusetts Business Trust
    	
 
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Andy Acker
    	
 
    
	
Name:   Andy Acker
    	
 
    
	
Title:   Executive Vice President, Portfolio Manager
    	
 
    
	
 
    	
 
    
	
Address:   151 Detroit Street
    	
 
    
	
Denver,   CO 80206
    	
 
    

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

 

INVESTORS:

 

Adage Capital Partners LP

 

 

	
By:
    	
/s/ Dan Lehan
    	
 
    
	
Name: Dan   Lehan
    	
 
    
	
Title: Chief   Operating Officer
    	
 
    

 

Address: 200 Clarendon Street, 52nd Floor

Boston, MA   02116

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
QVT   Fund V LP,
    	
 
    
	
By:   QVT Associates GP LLC
    	
 
    
	
Its:   general partner
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Keith Manchester
    	
 
    
	
Name:
    	
Keith Manchester
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
QVT Fund   IV LP,
    	
 
    
	
By:   QVT Associates GP LLC
    	
 
    
	
Its:   general partner
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Keith Manchester
    	
 
    
	
Name:
    	
Keith Manchester
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Quintessence   Fund L.P.,
    	
 
    
	
By:   QVT Associates GP LLC
    	
 
    
	
Its:   general partner
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Keith Manchester
    	
 
    
	
Name:
    	
Keith Manchester
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
					

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

 

	
INVESTORS:
    
	
 
    
	
ROCK SPRINGS CAPITAL MASTER FUND LP
    
	
By: Rock   Springs GP LLC
    
	
Its:   General Partner
    
	
 
    
	
 
    
	
By:
    	
/s/ Graham McPhail
    	
 
    
	
Name:
    	
Graham McPhail
    	
 
    
	
Title:
    	
Managing Director
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
650 South Exeter St.
    	
 
    
	
 
    	
Suite   1070
    	
 
    
	
 
    	
Baltimore,   MD 21202
    	
 
    
					

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

 

	
INVESTORS:
    
	
 
    
	
RTW Master Fund, Ltd
    
	
 
    
	
By:
    	
/s/ Roderick Wong
    	
 
    
	
Name:
    	
Roderick Wong
    	
 
    
	
Title:
    	
CCO
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
250 West 55th Street
    	
 
    
	
 
    	
16th FL, Suite A
    	
 
    
	
 
    	
New   York, NY 10019
    	
 
    
	
 
    
	
 
    
	
RTW Innovation Master Fund, Ltd
    
	
 
    
	
By:
    	
/s/ Roderick Wong
    	
 
    
	
Name:
    	
Roderick Wong
    	
 
    
	
Title:
    	
CCO
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
250 West 55th Street
    	
 
    
	
 
    	
16th FL, Suite A
    	
 
    
	
 
    	
New   York, NY 10019
    	
 
    
					

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
RA Capital Healthcare Fund, L.P.
    	
 
    
	
By: RA Capital Management, LLC
    	
 
    
	
Its: General Partner
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Rajeev Shah
    	
 
    
	
Name:
    	
Rajeev Shah
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    
	
Address:   20 Park Plaza, Suite 1200
    	
 
    
	
Boston, MA 02116
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Blackwell Partners LLC - Series A
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Justin B. Nixon
    	
 
    
	
Name:
    	
Justin B. Nixon
    	
 
    
	
Title:
    	
Investment Manager
   DUMAC, Inc.
   Authorized Agent
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Jannine M. Lall
    	
 
    
	
Name:
    	
Jannine M. Lall
    	
 
    
	
Title:
    	
Assistant Treasurer
   DUMAC, Inc.
   Authorized Agent
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
280 South Mangum   Street, Suite 210
    	
 
    
	
 
    	
Durham, NC 27701
    	
 
    
					

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
Boxer Capital, LLC
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Aaron Davis
    	
 
    
	
Name: Aaron   Davis
    	
 
    
	
Title: Chief   Executive Officer
    	
 
    
	
 
    	
 
    
	
Address:
    	
440 Stevens Ave, 100
    	
 
    
	
 
    	
Solana   Beach, CA 
    	
 
    
	
 
    	
92075
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
MVA Investors, LLC
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Aaron Davis
    	
 
    
	
Name: Aaron   Davis
    	
 
    
	
Title: Chief   Executive Officer
    	
 
    
	
 
    	
 
    
	
Address:
    	
440 Stevens Ave, 100
    	
 
    
	
 
    	
Solana   Beach, CA 
    	
 
    
	
 
    	
92075
    	
 
    
				

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
INVESTORS:
    	
 
    
	
 
    	
 
    
	
Foresite Capital Fund III, L.P.
    	
 
    
	
 
    	
 
    
	
By:    Foresite Capital Management III, LLC
    	
 
    
	
Its:    General Partner
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Dennis D. Ryan
    	
 
    
	
Name:   Dennis D. Ryan
    	
 
    
	
Title:     Chief Financial Officer
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Address:
    	
101 California St. 
    	
 
    
	
 
    	
Suite 4100
    	
 
    
	
 
    	
San Francisco, CA 94111
    	
 
    
				

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
KEY   HOLDERS:
    	
 
    
	
 
    	
 
    
	
WEST   SUMMIT INVESTMENTS, LP
    	
 
    
	
 
    	
 
    
	
By:   West Summit Investment GP, LLC
    	
 
    
	
Its:   General Partner
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ David G. Genecov
    	
 
    
	
Name: David   G. Genecov
    	
 
    
	
Title: Manager
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Address:
    	
11970 N. Central Expy.,   Ste. 270
    	
 
    
	
 
    	
Dallas, TX 75243
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
WEST   SUMMIT ANNUITY TRUST U/T/D JUNE 29, 2015
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ David G. Genecov
    	
 
    
	
Name: David   G. Genecov
    	
 
    
	
Title: Trustee
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Address:
    	
11970 N. Central Expy.,   Ste. 270
    	
 
    
	
 
    	
Dallas, TX 75243
    	
 
    
				

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

	
KEY   HOLDERS:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
/s/   Brian K. Kaspar
    	
 
    
	
Print   Name: Brian K. Kaspar
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Print   Name: John A. Carbona
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
JDH   INVESTMENT MANAGEMENT, LLC
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ John D. Harkey, Jr.
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
John D. Harkey, Jr.
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Manager
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
12200 Stemmons Freeway #   100
    	
 
    
	
 
    	
Dallas, TX 75234
    	
 
    
					

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

KEY HOLDERS:

 

Solely with respect to shares of Class A Common Stock and Class B-1 Common Stock held:

 

VENROCK HEALTHCARE CAPITAL PARTNERS II, L.P.

By: VHCP Management II, LLC

Its: General Partner

 

 

	
By:
    	
/s/ David L. Stepp
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
David L. Stepp
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
3340 Hillview Avenue
    	
 
    
	
 
    	
Palo Alto, CA 94304
    	
 
    
					

 

 

Solely with respect to shares of Class A Common Stock and Class B-1 Common Stock held:

 

VHCP CO-INVESTMENT HOLDINGS II, LLC

By: VHCP Management II, LLC

Its: Manager

 

 

	
By:
    	
/s/ David L. Stepp
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
David L. Stepp
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Authorized Signatory
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
3340 Hillview Avenue
    	
 
    
	
 
    	
Palo Alto, CA 94304
    	
 
    
					

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

KEY HOLDERS:

 

Solely with respect to shares of Class A Common Stock held:

 

DEERFIELD PRIVATE DESIGN FUND III, L.P.

 

	
By:
    	
Deerfield Mgmt III, L.P.
    	
 
    
	
 
    	
General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
J.E.   Flynn Capital III, LLC
    	
 
    
	
 
    	
 
    	
 General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Name:   David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Title:      Authorized Signatory
    	
 
    

 

 

Address: Deerfield Capital, 780 Third Avenue

New York, NY 10017

Attn: Lawrence Atinsky

 

 

Solely with respect to shares of Class A Common Stock held:

 

DEERFIELD SPECIAL SITUATIONS FUND, L.P.

 

	
By:
    	
Deerfield Mgmt, L.P.
    	
 
    
	
 
    	
General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
By:
    	
J.E.   Flynn Capital, LLC
    	
 
    
	
 
    	
 
    	
General   Partner
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Name:   David J. Clark
    	
 
    
	
 
    	
 
    	
 
    	
Title:     Authorized Signatory
    	
 
    

 

 

Address: Deerfield Capital, 780 Third Avenue

New York, NY 10017

Attn: Lawrence Atinsky

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

 

KEY HOLDERS:

 

Solely with respect to shares of Class A Common Stock held:

 

ROCHE FINANCE LTD

 

 

	
By:
    	
/s/ Carole Nuechterlein
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Carole Nuechterlein
    	
 
    
	
 
    	
 
    	
 
    
	
Its:
    	
authorized signatory
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ Andreas Knierzinger
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
Andreas Knierzinger
    	
 
    
	
 
    	
 
    	
 
    
	
Its:
    	
authorized signatory
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
				

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

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

 

 

KEY HOLDERS:

 

Solely with respect to shares of Class A Common Stock held:

 

PBM CAPITAL INVESTMENTS, LLC

 

 

	
By:
    	
/s/ Russell T. Schundler
    	
 
    
	
Name:
    	
Russell T. Schundler
    	
 
    
	
Title:
    	
Executive Vice President
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
200   Garrett Street, Suite S
    	
 
    
	
 
    	
Charlottesville,   VA 22902
    	
 
    
	
 
    	
 
    
					

 

[AveXis, Inc. Signature Page to Third Amended and Restated Investors’ Rights Agreement]

 

 

ADOPTION AGREEMENT

 

This Adoption Agreement (“Adoption Agreement”) is executed on September 24, 2015, by the undersigned (the “Holder”)  pursuant to the terms of that certain Third Amended and Restated Investor Rights Agreement dated as of September 3, 2015 (the “Agreement”),  by and among AveXis, Inc. (the “Company”) and certain of its stockholders, as such Agreement may be amended or amended and restated hereafter. Capitalized terms used but not defined in this Adoption Agreement shall have the respective meanings ascribed to such terms in the Agreement. By the execution of this Adoption Agreement, the Holder agrees as follows:

 

1.1         Acknowledgement. Holder acknowledges that Holder is acquiring shares of the Company’s Class A Common Stock (the “Stock”) and that Holder will be a “Key Holder” for all purposes of the Agreement.

 

1.2         Agreement. (a) The Stock, and any other shares of capital stock or securities required by the Agreement to be bound thereby, shall be bound by and subject to the terms of the Agreement and (b) Holder adopts the Agreement with the same force and effect as if Holder were originally a party thereto. This Adoption Agreement shall be deemed to constitute a counterpart signature page to the Agreement.

 

1.3         Notice. Any notice required or permitted by the Agreement shall be given to Holder at the address, facsimile number or email address listed below:

 

1701 Pennsylvania Ave NW, Suite 900

Washington, DC 20006

Attn: Daniel O’Donnell

Fax: 202-778-2330

Email: dodonnell@foxkiser.com

 

 

IN WITNESS WHEREOF, the undersigned has executed this Adoption Agreement as of the date first written above.

 

HOLDER:

 

FOXKISER Ventures Fund V LLC

 

	
By:
    	
/s/   Daniel O’Donnell
    	
 
    
	
Name:
    	
Daniel O’Donnell
    	
 
    
	
Title:
    	
Manager
    	
 
    

 

 

 

SCHEDULE A

Investors

 

	
Investor Name
    	
 
    	
Contact
    
	
 
    	
 
    	
 
    
	
PBM Capital Investments, LLC
    	
 
    	
200 Garrett Street, Suite S
   Charlottesville, Virginia 22902
   Attn: Sean Stalfort
   Email: sstalfort@pbmcap.com
    
	
 
    	
 
    	
 
    
	
Adam Burke
    	
 
    	
200 Garrett Street, Suite Q
   Charlottesville, VA 22903
    
	
 
    	
 
    	
 
    
	
Kevin Combs
    	
 
    	
3420 Keswick Road
   Keswick, VA 22947
    
	
 
    	
 
    	
 
    
	
Damian deGoa
    	
 
    	
1407 Sunderland Lane
   Keswick, VA 22947
    
	
 
    	
 
    	
 
    
	
Steven Goldman
    	
 
    	
390 West End Avenue
   Apt 6J
   NY, NY 10024
    
	
 
    	
 
    	
 
    
	
Mike McCauley
    	
 
    	
318 4th St . S. E.
   Apt 1
   Charlottesville Va. 22902
    
	
 
    	
 
    	
 
    
	
James Reebals
    	
 
    	
199 Hall Drive
   Barboursville, VA 22923
    
	
 
    	
 
    	
 
    
	
Jayson Rieger
    	
 
    	
3388 Turnberry Circle
   Charlottesville, VA 22911
    
	
 
    	
 
    	
 
    
	
Eugene Scavola
    	
 
    	
815 Carlyle Place
   Charlottesville, VA 22903
    
	
 
    	
 
    	
 
    
	
Russell Schundler
    	
 
    	
50 Gooseneck Lane
   Charlottesville, VA 22903
    
	
 
    	
 
    	
 
    
	
Sean Stalfort
    	
 
    	
200 Garrett Street, Suite S
   Charlottesville, VA 22903
    

 

 

	
Deerfield Private Design Fund III, L.P.
    	
 
    	
Deerfield Capital
   780 Third Avenue
   New York, NY 10017
   Attn: Lawrence Atinsky
    
	
 
    	
 
    	
 
    
	
Deerfield Special Situations Fund, L.P.
    	
 
    	
Deerfield Capital
   780 Third Avenue
   New York, NY 10017
   Attn: Lawrence Atinsky
    
	
 
    	
 
    	
 
    
	
Roche Finance Ltd
    	
 
    	
Roche Finance Ltd
   Grenzacherstrasse 122
   4070 Basel, Switzerland
   Fax: + 41 61 687 0644
   Attn: Roche Venture Fund, Carole Nuechterlein
    
	
 
    	
 
    	
 
    
	
Venrock Healthcare Capital Partners II, L.P.
    	
 
    	
3340 Hillview Avenue
   Palo Alto, CA 94304
   Attn: David L. Stepp
   Fax: 650-561-9180
   Email: dstepp@venrock.com
    
	
 
    	
 
    	
 
    
	
VHCP Co-Investment Holdings II, LLC
    	
 
    	
3340 Hillview Avenue
   Palo Alto, CA 94304
   Attn: David L. Stepp
   Fax: 650-561-9180
   Email: dstepp@venrock.com
    
	
 
    	
 
    	
 
    
	
T. Rowe Price Health Sciences Fund, Inc.
    	
 
    	
T. Rowe Price Associates, Inc.
   100 East Pratt Street
   Baltimore, MD 21202
   Attn: Andrew Baek, Vice President and Senior
   Legal Counsel
   Phone: 410-345-2090
   E-mail: andrew_baek@troweprice.com
    
	
 
    	
 
    	
 
    
	
TD Mutual Funds — TD Health Sciences Fund
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
VALIC Company I — Health Sciences Fund
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
T. Rowe Price Health Sciences Portfolio
    	
 
    	
Same address as above
    

 

 

	
John Hancock Variable Insurance Trust — Health   Sciences Trust
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
John Hancock Funds II — Health Sciences Fund
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
T. Rowe Price New Horizons Fund, Inc.
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
T. Rowe Price New Horizons Trust
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
T. Rowe Price U.S. Equities Trust
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
Janus Global Life Sciences Fund, a series of Janus   Investment Fund, a Massachusetts Business Trust
    	
 
    	
151 Detroit Street
   Denver, CO 80206
    
	
 
    	
 
    	
 
    
	
Adage Capital Partners LP
    	
 
    	
200 Clarendon Street
   52nd Floor
   Boston, MA 02116
    
	
 
    	
 
    	
 
    
	
QVT Fund V LP
    	
 
    	
C/O QVT Financial LP
   1177 Avenue of the Americas
   9th Floor
   New York, NY 10036
   Attention: Keith Manchester & Oren Eisner
   Tel: (212) 705-8800
   Keith.Manchester@qvt.com
   Oren.Eisner@qvt.com
   Legalnotices@qvt.com
    
	
 
    	
 
    	
 
    
	
QVT Fund IV LP
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
Quintessence Fund L.P.
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
Rock Springs Capital Master Fund LP
    	
 
    	
650 South Exeter Street, Suite 1070
   Baltimore, MD 21202
   Attn: Graham McPhail
    
	
 
    	
 
    	
 
    
	
RTW Master Fund, Ltd
    	
 
    	
250 West 55th Street
   16th Floor, Suite A
   New York, NY 10019
   Attn: Roderick Wong
    
	
 
    	
 
    	
 
    
	
RTW Innovation Master Fund, Ltd
    	
 
    	
Same address as above
    

 

 

	
RA Capital Healthcare Fund, L.P.
    	
 
    	
20 Park Plaza, Suite 1200
   Boston, MA 02116
    
	
 
    	
 
    	
 
    
	
Blackwell Partners LLC - Series A
    	
 
    	
20 Park Plaza, Suite 1200
   Boston, MA 02116
    
	
 
    	
 
    	
 
    
	
Boxer Capital, LLC
    	
 
    	
440 Sterns Avenue, 100
   Solana Beach, CA 92078
   Attn: Aaron Davis
    
	
 
    	
 
    	
 
    
	
MVA Investors, LLC
    	
 
    	
Same address as above
    
	
 
    	
 
    	
 
    
	
Foresite Capital Fund III, L.P.
    	
 
    	
101 California Street, Suite 4100
   San Francisco, CA 94111
    

 

 

SCHEDULE B

 

Key Holders

 

	
Key Holder Name
    	
 
    	
Contact
    
	
 
    	
 
    	
 
    
	
JDH Investment Management, LLC
    	
 
    	
12200 Stemmons Freeway, Suite 100
   Dallas, TX 75234
   Attn: John D. Harkey, Jr.
    
	
 
    	
 
    	
 
    
	
West Summit Investments, LP
    	
 
    	
11970 N. Central Expy., Suite 270
   Dallas, TX 75243
   Attn: David G. Genecov, MD
    
	
 
    	
 
    	
 
    
	
West Summit Annuity Trust u/t/d June 29, 2015
    	
 
    	
11970 N. Central Expy., Suite 270
   Dallas, TX 75243
   Attn: David G. Genecov, Trustee
   Fax: 972-331-1909
   Email: dgenecov@mac.com
    
	
 
    	
 
    	
 
    
	
John Carbona
    	
 
    	
1900 McKinney Ave., Apt. 1101
   Dallas, TX 75201
    
	
 
    	
 
    	
 
    
	
Brian K. Kaspar
    	
 
    	
7883 Calverton Square
   New Albany, OH 43054
    
	
 
    	
 
    	
 
    
	
Venrock Healthcare Capital Partners II, L.P.
   (Solely with respect to 266,813 shares of Class A Common Stock and   53,363 shares of Class B-1 Common Stock held)
    	
 
    	
3340 Hillview Avenue
   Palo Alto, CA 94304
   Attn: David L. Stepp
   Fax: 650-561-9180
   Email: dstepp@venrock.com
    
	
 
    	
 
    	
 
    
	
VHCP Co-Investment Holdings II, LLC
   (Solely with respect to 108,187 shares of Class A Common Stock and   21,637 shares of Class B-1 Common Stock held)
    	
 
    	
3340 Hillview Avenue
   Palo Alto, CA 94304
   Attn: David L. Stepp
   Fax: 650-561-9180
   Email: dstepp@venrock.com
    
	
 
    	
 
    	
 
    
	
Deerfield Private Design Fund III, L.P.
   (Solely with respect to 95,588 shares of Class A Common Stock held)
    	
 
    	
Deerfield Capital
   780 Third Avenue
   New York, NY 10017
   Attn: Lawrence Atinsky
    

 

 

	
Deerfield Special Situations Fund, L.P.
   (Solely with respect to 95,588 shares of Class A Common Stock held)
    	
 
    	
Deerfield Capital
   780 Third Avenue
   New York, NY 10017
   Attn: Lawrence Atinsky
    
	
 
    	
 
    	
 
    
	
Roche Finance Ltd
   (Solely with respect to 58,824 shares of Class A Common Stock held)
    	
 
    	
Roche Finance Ltd
   Grenzacherstrasse 122
   4070 Basel, Switzerland
   Fax: + 41 61 687 0644
   Attn: Roche Venture Fund, Carole Nuechterlein
    
	
 
    	
 
    	
 
    
	
PBM Capital Investments, LLC
   (Solely with respect to 176,471 shares of Class A Common Stock held)
    	
 
    	
200 Garrett Street, Suite S
   Charlottesville, Virginia 22902
   Attn: Sean Stalfort
   Email: sstalfort@pbmcap.com
    
	
 
    	
 
    	
 
    
	
FOXKISER Ventures Fund V LLC
    	
 
    	
1701 Pennsylvania Ave NW #900
   Washington, DC 20006

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00253-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00253-of-00352.parquet"}]]