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Exhibit 4.10    
    

METABASIS THERAPEUTICS, INC.  

 SERIES E PREFERRED STOCK PURCHASE AGREEMENT  

 DATED AS OF OCTOBER 28, 2003  

 
METABASIS THERAPEUTICS, INC.  

 SERIES E PREFERRED STOCK PURCHASE AGREEMENT  

        THIS SERIES E PREFERRED STOCK PURCHASE AGREEMENT (the  "Agreement") is made as
of the 28th day of October, 2003, by and among METABASIS
THERAPEUTICS, INC., a Delaware corporation (the "Company"), and the investors listed on  Exhibit A attached hereto
(each a "Purchaser" and together the  "Purchasers"). 

        The
parties hereby agree as follows: 

        1.    PURCHASE AND SALE OF PREFERRED STOCK.    

        1.1    Sale and Issuance of Series E Preferred Stock.    

        (a)   The Company shall adopt and file with the Secretary of State of the State of Delaware on or before the Closing (as
defined below) the Amended and Restated Certificate of Incorporation in the form attached hereto as Exhibit B (the  "Restated Certificate").

        (b)   The Company has, or will have before the Closing, authorized the sale and issuance of up to 24,032,095 shares of
Series E Preferred Stock (the "Stock"). Subject to the terms and conditions of this Agreement, each Purchaser agrees to purchase at the Closing,
and the Company agrees to sell and issue to each Purchaser at the Closing, that number of shares of Stock as set forth opposite each such Purchaser's name on  Exhibit A attached hereto, at a
purchase price of $1.04 per share of Stock. 

        1.2    Closing; Delivery.    

        (a)   The purchase and sale of the Stock shall take place at the offices of Cooley Godward llp ("Cooley
Godward"), 4401 Eastgate Mall, San Diego, California, 92121, at 10:00 a.m., on the date hereof or at such other time and place as the parties shall agree upon (which
time and place are designated as the "Closing"). 

        (b)   At the Closing, the Company shall deliver to each Purchaser a certificate representing the Stock being purchased thereby
against payment of the purchase price therefor by (i) check payable to the Company or by wire transfer to the Company's bank account ("Cash
Consideration") or (ii) in the case of LB I Group Inc. only, past services ("Past Services Consideration")
performed by Lehman Brothers Inc. ("Lehman") pursuant to the engagement letter dated January 12, 2003 between the Company and Lehman, as
amended on the date hereof (the "Engagement Letter"). The amounts of Cash Consideration and Past Services Consideration attributable to each applicable
Purchaser shall be as set forth opposite such Purchaser's name on Exhibit A attached hereto. 

        2.    REPRESENTATIONS AND WARRANTIES OF THE COMPANY.    The Company
hereby represents and warrants to each Purchaser that, except as set forth on a Schedule of Exceptions attached hereto as Exhibit C, which
exceptions shall be deemed to be representations and warranties as if made hereunder: 

        2.1    Organization, Good Standing and Qualification.    The Company
is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware, has all corporate power and authority to execute and deliver, and to perform its
obligations pursuant to, each of the Transaction Documents, as defined below, and has all requisite power and authority to conduct its business as presently conducted and proposed to be conducted. The
Company is duly qualified to transact business and is in good standing in each jurisdiction in which the failure so to qualify would have a Material Adverse Effect (as defined below).  "Transaction
Documents" means this Agreement, the Amended and Restated Investors' Rights Agreement (the "Investors' Rights
Agreement") in the form attached hereto as Exhibit D, the Amended and Restated Co-Sale 

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Agreement
(the "Co-Sale Agreement", and together with this Agreement and the Investors' Rights Agreement, the
"Agreements") in the form attached hereto as Exhibit E and the Restated Certificate (including in
each case all exhibits and schedules thereto). "Material Adverse Effect" means a material adverse effect on the condition (financial or otherwise),
prospects, assets relating to, or results of operations of the Company's business, as presently conducted and proposed to be conducted. 

        2.2    Capitalization.    The authorized capital of the Company
consists of: 

        (a)   74,765,759 shares of preferred stock, par value $.001 per share (the "Preferred
Stock"), 851,939 of which have been designated Series A Convertible Preferred Stock ("Series A Preferred Stock"),
all of which are issued and outstanding, 10,000,000 of which have been designated Subordinated Convertible Preferred Stock ("Subordinated Preferred
Stock"), all of which are issued and outstanding, 3,000,000 of which have been designated Series B Convertible Preferred Stock ("Series B
Preferred Stock"), of which none are issued and outstanding, 17,533,154 of which have been designated Series C Convertible Preferred Stock
("Series C Preferred Stock"), of which 13,009,999 are issued and outstanding, 19,230,666 of which have been designated Series D
Convertible Preferred Stock ("Series D Preferred Stock"), of which 15,737,705 are issued and outstanding, and 24,150,000 of which have been
designated Series E Convertible Preferred Stock ("Series E Preferred Stock"), of which none are issued and outstanding prior to the
Closing. The rights, preferences and privileges of the Series A Preferred Stock, the Series B Preferred Stock, the Series C Preferred Stock, the Series D Preferred Stock,
the Series E Preferred Stock and the Subordinated Preferred Stock are as stated in the Restated Certificate. Shares of Common Stock issuable upon conversion of the Series A Preferred
Stock, the Series B Preferred Stock, the Series C Preferred Stock, the Series D Preferred Stock, the Series E Preferred Stock and the Subordinated Preferred Stock have been
reserved by all necessary corporate action. 

        (b)   129,840,390 shares of common stock, par value $.001 per share (the "Common
Stock"), of which 10,725,148 are issued and outstanding. 

        (c)   Except for (i) the conversion privileges of the Subordinated Preferred Stock, the Series A Preferred Stock,
the Series B Preferred Stock, the Series C Preferred Stock and the Series D Preferred Stock, (ii) an aggregate of 7,957,471 shares of Common Stock reserved for issuance
pursuant to the Amended and Restated 2001 Equity Incentive Plan of Metabasis Therapeutics, Inc. (the "Stock Plan"), (iii) warrants to
purchase an aggregate of 4,469,217 shares of Series C Preferred Stock issued pursuant to the Series C Preferred Stock Purchase Agreement dated July 18, 2000 between the Company
and the Purchasers named therein, (iv) warrants to purchase an aggregate of 3,462,295 shares of Series D Preferred Stock issued pursuant to the Series D Preferred Stock Purchase
Agreement dated October 18, 2001 between the Company and the Purchasers named therein and (v) warrants to purchase an aggregate of 53,938 shares of Series C Preferred Stock and
30,666 shares of Series D Preferred Stock issued pursuant to equipment leasing facilities with GATX Ventures, Inc., a Delaware corporation, and except as set forth in this Agreement and
the other Transaction Documents, there are no outstanding options, warrants, rights (including conversion or preemptive rights or rights of first offer) or agreements, oral or written, for the
purchase or acquisition from the Company of any shares of its capital stock. 

        (d)   Immediately prior to the Closing, the outstanding Series D Preferred Stock, Series C Preferred Stock,
Series B Preferred Stock, Series A Preferred Stock and Subordinated Preferred Stock are convertible into 15,737,705, 13,009,999, 0, 3,002,111 and 10,000,000 shares of Common Stock,
respectively, and their conversion prices are equal to $1.22, $1.00, $1.50, $2.012 and $1.00, respectively. Assuming all shares of Stock authorized to be sold hereunder are sold at the Closing, the
outstanding Series D Preferred Stock, Series C Preferred Stock, Series B Preferred Stock, Series A Preferred Stock and Subordinated Preferred Stock will immediately after
the Closing be 

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convertible
into 16,494,843, 13,009,999, 0, 3,555,177 and 10,000,000 shares of Common Stock, respectively, and their conversion prices will be equal to $1.164, $1.00, $1.50, $1.699 and $1.00,
respectively. 

        All
shares of Common Stock and Preferred Stock issued and outstanding immediately prior to or issued concurrently with the Closing have been duly authorized and have been or will be, as
the case may be, validly issued in accordance with all applicable U.S. federal and state securities laws and are or, upon issuance will be, fully paid and nonassessable. 

        2.3    Authorization.    All corporate action on the part of the
Company, its officers, directors and stockholders necessary for (i) the authorization, execution and delivery of the Transaction Documents, (ii) the performance of all obligations of the
Company hereunder and thereunder and (iii) the authorization, issuance (or reservation for issuance) and delivery of the Stock have been taken and each of the Transaction Documents constitutes
the valid and legally binding obligation of the Company enforceable against the Company in accordance with its terms, except (i) as limited by applicable bankruptcy, insolvency, reorganization,
moratorium and other laws of general application affecting enforcement of creditors' rights generally and (ii) as limited by laws relating to the availability of specific performance,
injunctive relief or other equitable remedies. 

        2.4    Compliance with Other Instruments.    The Company is not in
violation or default of any provisions of its Restated Certificate or bylaws or of any judgment, order, writ or decree by which it is bound. To the knowledge of its officers, the Company is not in
violation or default of any instrument or contract to which it is a party or by which it is bound or, to the knowledge of its officers after reasonable inquiry, of any provision of any federal or
state statute (including without limitation environmental and labor
laws and filing requirements under the Employee Retirement Income Security Act of 1974 ("ERISA")), rule or regulation applicable to the Company, which
violation or default would have a Material Adverse Effect. The execution, delivery and performance of this Agreement and the other Transaction Documents and the consummation of the transactions
contemplated hereby and thereby will not result in any such violation or be in conflict with or constitute, with or without the passage of time and giving of notice, either a default under any such
provision, instrument, judgment, order, writ, decree or contract or an event which results in the creation of any material lien, charge or encumbrance upon any assets of the Company. 

        2.5    Title to Property and Assets.    The Company owns its property
and assets free and clear of all mortgages, liens, loans and encumbrances, except such encumbrances and liens which arise in the ordinary course of business and do not materially impair the Company's
ownership or use of such property or assets. With respect to the property and assets it leases, the Company is in material compliance with such leases and, to the knowledge of the Company's officers,
holds a valid leasehold interest free of any liens, claims or encumbrances, which liens, claims or encumbrances would be materially adverse to the Company. 

        2.6    Agreements; Action.    

        (a)   Except for the Transaction Documents, there are no agreements, understandings or proposed transactions between the
Company and any of its officers, directors, affiliates or any affiliate thereof. 

        (b)   There are no agreements, understandings, instruments, contracts or proposed transactions to which the Company is a party
or by which it is bound which involve (i) obligations (contingent or otherwise) of, or payments to the Company in excess of, $25,000, (ii) the license of any patent, copyright, trade
secret or other proprietary right of the Company or (iii) any other material obligation. 

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        (c)   The Company has not (i) declared or paid any dividends, or authorized or made any distribution upon or with
respect to any class or series of its capital stock, (ii) incurred any indebtedness for money borrowed or incurred any other liabilities individually in excess of $25,000 or in excess of
$100,000 in the aggregate, (iii) made any loans or advances to any person, other than ordinary advances for travel expenses or (iv) sold, exchanged or otherwise disposed of any of its
assets or rights, other than the sale of its inventory in the ordinary course of business. 

        (d)   The Company has not engaged in the past three (3) months in any discussion (i) with any representative of
any corporation or corporations regarding the consolidation or merger of the Company with or into any such corporation or corporations, (ii) with any corporation, partnership, association or
other business entity or any individual regarding the sale, conveyance or disposition of all or substantially all of the assets of the Company or a transaction or series of related transactions in
which more than fifty percent (50%) of the voting power of the Company is disposed of, or (iii) regarding any other form of liquidation, dissolution or winding up of the Company. 

        (e)   For the purposes of subsections (b) and (c) above, all indebtedness, liabilities, agreements, understandings,
instruments, contracts and proposed transactions involving the same person or entity (including persons or entities the Company has reason to believe are affiliated) shall be aggregated for the
purpose of meeting the individual minimum dollar amounts of such subsections. 

        (f)    The Company has delivered to the Purchasers a true and complete copy of each agreement listed on the Schedule of
Exceptions. 

        2.7    Patents and Trademarks.    The Company has sufficient title and
ownership of all patents, trademarks, service marks, trade names, copyrights, trade secrets, information, proprietary rights and processes necessary for its business as now conducted, to the knowledge
of its officers without any conflict with or infringement of the rights of others. There are no outstanding options, licenses or agreements of any kind relating to the foregoing, nor is the Company
bound by or a party to any options, licenses or agreements of any kind with respect to the patents, trademarks, service marks, trade names, copyrights, trade secrets, licenses, information,
proprietary rights and processes of any other person or entity. The Company has not received any communications alleging that the Company has violated or, by conducting its business as now conducted
or as proposed to be conducted, would violate any of the patents, trademarks, service marks, trade names, copyrights or trade secrets or other proprietary rights of any other person or entity. The
Company is not aware that any of its employees is obligated under any contract (including licenses, covenants or commitments of any nature) or other agreement, or subject to any judgment, decree or
order of any court or administrative agency, that would interfere with the use of such employee's best efforts to promote the interests of the Company or that would conflict with the Company's
business. 

        2.8    Employee Matters.    

        (a)   Each employee and consultant of the Company has executed a Proprietary Information and Inventions Agreement in the form
attached hereto as Exhibit F. The Company, after reasonable investigation, is not aware that any employee, or any such consultant, is in
violation of the terms thereof. 

        (b)   Upon termination of any employee, the Company will not by reason of any agreement existing prior to the Closing be liable
to such employee for severance pay or any other payments. 

        (c)   No labor strike, grievance, dispute or other labor trouble affecting the Company is pending or, to the knowledge of the
Company, threatened. No union or other collective bargaining entity has been certified as representing any employee of the Company; no union organization 

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effort
or representation question is pending with respect to the employees of the Company. The Company is not currently engaged in any labor negotiations with any union representing any employees. 

        2.9    Employee Benefit Plans.    The Company does not have any
employee benefit plan described in section 3(2)(A) or section 3(2)(B) of ERISA. 

        2.10    Permits.    The Company has all franchises, permits, licenses,
and any similar authority necessary for the conduct of its business as now being conducted by it, the lack of which could have a Material Adverse Effect, and the Company believes it can obtain,
without undue burden or expense, any similar authority for the conduct of its business as planned to be conducted. The Company is not in default in any material respect under any of such franchises,
permits, licenses, or other similar authority. 

        2.11    Required Consents.    Except as set forth in the Schedule of
Exceptions, no consent, approval, order, authorization, registration, qualification, designation, declaration or filing with, of or by any person or entity (including any federal, state or local
governmental authority) is required in connection with the Agreement or the transactions contemplated thereby. 

        2.12    Litigation.    There is no action, suit, proceeding or
investigation pending or, to the knowledge of the Company, currently threatened against the Company that questions the validity of any of the Transaction Documents, the right of the Company to enter
into any of the Transaction Documents or to consummate the transactions contemplated thereby, or that might, individually or in the aggregate, have a Material Adverse Effect, nor is the Company aware
that there is any basis for the foregoing. The Company is not a party or subject to the provisions of any order, writ, injunction, judgment or decree of any court or governmental authority. There is
no suit, proceeding or investigation by the Company currently pending, or that the Company intends to initiate. 

        2.13    Disclosure.    The Company has provided the Purchasers with
all the information that the Purchasers have requested for deciding whether to acquire the Stock. No representation or warranty made by the Company in the Transaction Documents and no statement made
by the Company in any financial statement (furnished pursuant to Section 2.17 or otherwise), certificate, report, exhibit or document furnished by the Company to the Purchasers in connection
with this Agreement or any of the Transaction Documents contains any untrue statement of a material fact or omits to state a material fact necessary in order to make the statements contained herein or
therein not misleading in light of the circumstances under which they were made. The Company has disclosed to the Purchasers in writing each fact which materially and adversely affects, or which so
far as the Company can now reasonably foresee in the future may result in a Material Adverse Effect. 

        2.14    Insurance.    The Company has in full force and effect fire
and casualty insurance policies, with extended coverage, sufficient in amount (subject to reasonable deductibles) to allow it to replace any of its properties that might be damaged or destroyed. The
Company has in full force and effect products liability and errors and omissions insurance in amounts customary for companies similarly situated. 

        2.15    Environmental and Safety Laws.    To the knowledge of its
officers, the Company is not in violation in any material respect of any applicable statute, law or regulation relating to the environment or occupational health and safety, and to the best of its
knowledge, no material expenditures are or will be required in order to comply with any such existing statute, law or regulation. 

        2.16    Voting Arrangements.    Except as provided in the Restated
Certificate, the Investors' Rights Agreement and hereunder, to the knowledge of the Company's officers, there are no 

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outstanding
stockholder agreements, voting trusts, proxies or other arrangements or understandings among the stockholders of the Company relating to the voting of their respective shares. Except as
contemplated in the Investors' Rights Agreement, the Company has not granted or agreed to grant any registration rights, including "piggyback" registration rights, to any person or entity. 

        2.17    Financial Statements.    The Company has delivered to the
Purchasers the Company's audited financial statements (balance sheet, statement of operations and statement of changes in stockholders' equity) for the period from inception to December 31,
2002 and unaudited financial statements (balance sheet, statement of operations and statement of changes in stockholders' equity) for the seven-month period ended July 31, 2003 (the  "Statement Date") (collectively, the "Financial Statements"). The Financial Statements are complete and
correct in all material respects, fairly present the financial condition and operating results of the Company as of the dates, and for the periods, indicated therein, and have been prepared in
accordance with generally accepted accounting principles ("GAAP") consistently applied, except, in the case of unaudited Financial Statements, for the
omission of footnotes required by GAAP (the omission of which is not individually or in the aggregate material) and subject to normal year-end GAAP audit adjustments (which are not
individually or in the aggregate material). Except as set forth in the Financial Statements, the Company has no liabilities, contingent or otherwise, other than (i) liabilities incurred in the
ordinary course of business subsequent to the Statement Date and (ii) obligations under contracts and commitments incurred in the ordinary course of business and not required under GAAP to be
reflected in the Financial Statements, which, in both cases, individually or in the aggregate, are not material to the financial condition or operating results of the Company. The Company is not a
guarantor or indemnitor of any indebtedness of any third party. 

        2.18    Compliance with Laws.    The execution, delivery and
performance of the Transaction Documents will not result in any violation of, be in conflict with, or constitute a default under, with or without the passage of time or the giving of notice:
(i) any provision of the Company's Restated Certificate or Bylaws; (ii) any provision of any judgment, decree or order to which the Company is a party or by
which it is bound; (iii) any material contract, obligation or commitment to which the Company is a party or by which it is bound; or (iv) to the best of Company's knowledge, any statute,
rule or governmental regulation applicable to the Company. The Company is conducting and has conducted its business in compliance with all statutes, rules, and governmental regulations applicable to
the Company. 

        2.19    Subsidiaries.    The Company does not currently own or
control, directly or indirectly, any interest in any other corporation, association or other business entity. 

        2.20    Changes.    Since the Statement Date, there has not been to
the Company's knowledge: 

        (a)   any change in the assets, liabilities, financial condition or operating results of the Company from that reflected in the
Financial Statements, except changes in the ordinary course of business that have not been, in the aggregate, materially adverse; 

        (b)   any damage, destruction or loss, whether or not covered by insurance, which could reasonably be expected to have a
Material Adverse Effect; 

        (c)   any waiver or compromise by the Company of a valuable right or of a material debt owed to it; 

        (d)   any satisfaction or discharge of any lien, claim or encumbrance or payment of any obligation by the Company, except in
the ordinary course of business and that is not material to the business, properties, prospects or financial condition of the Company; 

        (e)   any material change to a material contract or agreement by which the Company or any of its assets is bound or subject; 

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        (f)    any material change in any compensation arrangement or agreement with any employee, officer, director or stockholder; 

        (g)   any sale, assignment or transfer of any patents, trademarks, copyrights, trade secrets or other intangible assets; 

        (h)   any resignation or termination of employment of any officer or key employee of the Company, and the Company is not aware
of any impending resignation or termination of employment of any such officer or key employee; 

        (i)    any declaration, setting aside or payment or other distribution in respect to any of the Company's capital stock, or any
direct or indirect redemption, purchase, or other acquisition of any of such stock by the Company; 

        (j)    any other event or condition of any character that could reasonably be expected to have a Material Adverse Effect; or 

        (k)   any arrangement or commitment by the Company to do any of the things described in this Section 2.20. 

        3.    REPRESENTATIONS AND WARRANTIES OF THE PURCHASERS.    Each
Purchaser hereby represents and warrants, severally and not jointly, to the Company that: 

        3.1    Authorization.    Such Purchaser has full power and authority
to enter into this Agreement. The Agreements, when executed and delivered by the Purchaser, will constitute valid and legally binding obligations of the Purchaser, enforceable in accordance with their
terms, except (a) as limited by applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance, and any other laws of general application affecting enforcement of
creditors' rights generally, and as limited by laws relating to the availability of a specific performance, injunctive relief, or other equitable remedies, or (b) to the extent the
indemnification provisions contained in the Investors' Rights Agreement may be limited by applicable federal or state securities laws. 

        3.2    Purchase Entirely for Own Account.    This Agreement is made
with the Purchaser in reliance upon the Purchaser's representation to the Company, which by the Purchaser's execution of this Agreement, the Purchaser hereby confirms, that the Stock to be acquired by
the Purchaser will be acquired for investment for the Purchaser's own account, not as a nominee or agent, and not with a view to the resale or distribution of any part thereof, and that the Purchaser
has no present intention of selling, granting any participation in, or otherwise distributing the same. By executing this Agreement, the Purchaser further represents that the Purchaser does not
presently have any contract, undertaking, agreement or arrangement with any person to sell, transfer or grant participations to such person or to any third person, with respect to any of the Stock.
The Purchaser has not been formed for the specific purpose of acquiring the Stock. 

        3.3    Disclosure of Information.    The Purchaser has had an
opportunity to discuss the Company's business, management, financial affairs and the terms and conditions of the offering of the Stock with the
Company's management. The Purchaser understands that such discussions, as any written information delivered by the Company to the Purchaser, were intended to describe the aspects of the Company's
business which it believes to be material. 

        3.4    Restricted Securities.    The Purchaser understands that the
Stock has not been, and will not be, registered under the Securities Act of 1933, as amended (the "Securities Act"), by reason of a specific exemption
from the registration provisions of the Securities Act which depends upon, among other things, the bona fide nature of the investment intent and the accuracy of the Purchaser's representations as
expressed herein. The Purchaser understands that the shares of Stock are "restricted securities" under applicable U.S. federal and state securities laws
and that, pursuant to these laws, the Purchaser must hold the Stock indefinitely unless it is registered with 

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the
Securities and Exchange Commission and qualified by state authorities, or an exemption from such registration and qualification requirements is available. The Purchaser acknowledges that the
Company has no obligation to register or qualify the Stock for resale except as set forth in the Investors' Rights Agreement. The Purchaser further acknowledges that if an exemption from registration
or qualification is available, it may be conditioned on various requirements including, but not limited to, the time and manner of sale, the holding period for the Stock, and on requirements relating
to the Company which are outside of the Purchaser's control, and which the Company is under no obligation and may not be able to satisfy. 

        3.5    No Public Market.    The Purchaser understands that no public
market now exists for any of the securities issued by the Company, and that the Company has made no assurances that a public market will ever exist for the Stock. 

        3.6    Legends.    The Purchaser understands that the Stock and any
securities issued in respect of or exchange for the Stock, may bear one or all of the following (or substantially similar) legends: 

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

        (b)   Any legend set forth in the other Transaction Documents. 

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

        3.7    Accredited Investor.    The Purchaser is an accredited investor
as defined in Rule 501(a) of Regulation D promulgated under the Securities Act; provided that in the case of the Wellcome Trust Limited, such representation is made only as to the
Wellcome Trust itself and not as to the Wellcome Trust Limited, as trustee of the Wellcome Trust. 

        3.8    Foreign Investors.    If the Purchaser is not a United States
person (as defined by Section 7701(a)(30) of the Internal Revenue Code of 1986, as amended), such Purchaser hereby represents that it has satisfied itself as to the full observance of the laws
of its jurisdiction in connection with any invitation to subscribe for the Stock or any use of this Agreement, including (i) the legal requirements within its jurisdiction for the purchase of
the Stock, (ii) any foreign exchange restrictions applicable to such purchase, (iii) any governmental or other consents that may need to be obtained, and (iv) the income tax and
other tax consequences, if any, that may be relevant to the purchase, holding, redemption, sale, or transfer of the Stock. Such Purchaser's subscription and payment for and continued beneficial
ownership of the Stock, will not violate any applicable securities or other laws of the Purchaser's jurisdiction. 

        4.    CONDITIONS OF THE PURCHASERS' OBLIGATIONS AT CLOSING.    The
obligations of each Purchaser to the Company under this Agreement are subject to the fulfillment, on or before the applicable Closing, of each of the following conditions, unless otherwise waived: 

        4.1    Representations and Warranties.    The representations and
warranties of the Company contained in Section 2 shall be true and correct on and as of the date of the Closing, with the same effect as though such representations and warranties had been made
on and as of such date. 

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        4.2    Performance.    The Company shall have performed and complied
with all covenants, agreements, obligations and conditions contained in this Agreement that are required to be performed or complied with by it on or before the Closing. 

        4.3    Compliance Certificate.    The President of the Company shall
deliver to the Purchasers at the Closing a certificate certifying that the conditions specified in Sections 4.1 and 4.2 have been fulfilled. 

        4.4    Opinion of Company Counsel.    The Purchasers shall have
received from Cooley Godward, counsel for the Company, an opinion, dated as of the Closing, in substantially the form of Exhibit G. 

        4.5    Investors' Rights Agreement.    The Company and each Purchaser
shall have executed and delivered the Investors' Rights Agreement. 

        4.6    Restated Certificate.    The Company shall have filed the
Restated Certificate with the Secretary of State of Delaware on or prior to the Closing Date, which shall continue to be in full force and effect as of the Closing Date. 

        4.7    Co-Sale Agreement.    The Company, the Purchasers,
and the other parties to the Co-Sale Agreement shall have executed and delivered the Co-Sale Agreement. 

        5.    CONDITIONS OF THE COMPANY'S OBLIGATIONS AT CLOSING.    The
obligations of the Company to each Purchaser under this Agreement are subject to the fulfillment, on or before the Closing, of each of the following conditions, unless otherwise waived: 

        5.1    Representations and Warranties.    The representations and
warranties of each Purchaser contained in Section 3 shall be true and correct in all material respects on and as of the Closing with the same effect as though such representations and
warranties had been made on and as of the Closing. 

        5.2    Performance.    All covenants, agreements and conditions
contained in this Agreement to be performed by the Purchasers on or prior to the Closing shall have been performed or complied with in all material respects. 

        5.3    Qualifications.    All authorizations, approvals or permits, if
any, of any governmental authority or regulatory body of the United States or of any state that are required in connection with the lawful issuance and sale of the Stock pursuant to this Agreement
shall be obtained and effective as of the Closing. 

        6.    MISCELLANEOUS.    

        6.1    Transfer; Successors and Assigns.    The terms and conditions
of this Agreement shall inure to the benefit of and be binding upon the respective successors and assigns 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 assigns any rights, remedies, obligations, or liabilities under or by reason of this Agreement, except as expressly provided in
this Agreement. 

        6.2    Governing Law.    This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be governed, construed and interpreted in accordance with the laws of the State of California, without giving effect to
principles of conflicts of law. 

        6.3    Counterparts.    This Agreement 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. 

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

9

 

        6.5    Notices.    Any notice required or permitted by this Agreement
shall be in writing and shall be deemed sufficient upon delivery, when delivered personally or by overnight courier or sent by telegram or fax, or seventy-two (72) hours after being
deposited in the U.S. mail, as certified or registered mail, with postage prepaid, addressed to the party to be notified at such party's address as set forth on the signature page or  Exhibit A
hereto, or as subsequently modified by written notice, and (a) if to the Company, at 9390 Towne Centre Drive, San Diego,
California, 92121, with a copy to Frederick T. Muto, Cooley Godward llp, 4401 Eastgate Mall, San Diego, California, 92121, or (b) if to the Purchasers, at their respective addresses set forth
in Exhibit A hereto. 

        6.6    Finder's Fee.    Each party represents that it neither is nor
will be obligated for any finder's fee or commission in connection with this transaction, except for the Company's obligations pursuant to the Engagement Letter. Each Purchaser agrees, severally and
not jointly, to indemnify and to hold harmless the Company from any liability for any commission or compensation in the nature of a finder's fee (and the costs and expenses of defending against such
liability or asserted liability) for which such Purchaser or any of its officers, employees, or representatives is responsible. The Company agrees to indemnify and hold harmless each Purchaser from
any liability for any commission or compensation in the nature of a finder's fee (and the costs and expenses of defending against such liability or asserted liability) for which the Company or any of
its officers, employees or representatives is responsible, except for the Company's obligations pursuant to the Engagement Letter. 

        6.7    Attorney's Fees.    If any action at law or in equity
(including arbitration) is necessary to enforce or interpret the terms of any of the Agreements, the prevailing party shall be entitled to reasonable attorney's fees, costs and necessary disbursements
in addition to any other relief to which such party may be entitled. 

        6.8    Amendments and Waivers.    Any term of this Agreement may be
amended or waived only with the written consent of the Company and the holders of at least a majority of the Common Stock that is
issued or issuable upon conversion of the Series E Preferred Stock. Any amendment or waiver effected in accordance with this Section 6.8 shall be binding upon the Purchasers and each
transferee of the Series E Preferred Stock (or the Common Stock issuable upon conversion thereof), each future holder of all such securities, and the Company. 

        6.9    Severability.    If one or more provisions of this Agreement
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 Agreement, (b) the balance of the Agreement shall be interpreted as if such provision were so excluded
and (c) the balance of the Agreement shall be enforceable in accordance with its terms. 

        6.10    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
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 Agreement, or any waiver on the part of any party of any provisions or conditions of this Agreement, must
be in writing and shall be effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement or by law or otherwise afforded to any party, shall be
cumulative and not alternative. 

10

 

        6.11    Entire Agreement.    This Agreement, 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. 

        6.12    Corporate Securities Law.    THE SALE OF THE SECURITIES WHICH
ARE THE SUBJECT OF THIS AGREEMENT HAS NOT BEEN QUALIFIED WITH THE COMMISSIONER OF CORPORATIONS OF THE STATE OF CALIFORNIA AND THE ISSUANCE OF THE SECURITIES OR THE PAYMENT OR RECEIPT OF ANY PART OF
THE CONSIDERATION THEREFOR PRIOR TO THE QUALIFICATION IS UNLAWFUL, UNLESS THE SALE OF SECURITIES IS EXEMPT FROM THE QUALIFICATION BY SECTION 25100, 25102 OR 25105 OF THE CALIFORNIA CORPORATIONS
CODE. THE RIGHTS OF ALL PARTIES TO THIS AGREEMENT ARE EXPRESSLY CONDITIONED UPON THE QUALIFICATION BEING OBTAINED UNLESS THE SALE IS SO EXEMPT. 

        6.13    Confidentiality.    Each party hereto agrees that, except as
may be required in connection with any registration statement filed by the Company under the Securities Act, or with the prior written permission of the other party, it shall at all times keep
confidential and not divulge, furnish or make accessible to anyone any confidential information, knowledge or data concerning or relating to the business or financial affairs of the other parties to
which such party has been or shall become privy by reason of this Agreement, discussions or negotiations relating to this Agreement, the performance of its obligations hereunder or the ownership of
Stock purchased hereunder. The provisions of this Section 6.13 shall be in addition to, and not in substitution for, the provisions of any separate nondisclosure agreement executed by the
parties hereto with respect to the transactions contemplated hereby. Except to the extent required by law, regulation or applicable exchange rule, the Company shall not make any announcement
identifying, concerning or otherwise reference in any public document or public statement, the Purchaser or the beneficial owner of Purchaser. With respect to any press release issued by Company in
which the Purchaser is so identified or referenced, the Company shall provide copies to the Purchaser prior to public dissemination thereof and shall incorporate Purchaser's comments to such press
release, if any, in good faith. 

        6.14    Exculpation Among Purchasers.    Each Purchaser acknowledges
that it is not relying upon any person, firm or corporation, other than the Company and its officers and directors, in making its investment or decision to invest in the Company. Each Purchaser agrees
that no Purchaser nor the respective controlling persons, officers, directors, partners, agents, or employees of any Purchaser shall be liable to any other Purchaser for any action heretofore or
hereafter taken or omitted to be taken by any of them in connection with the purchase of the Stock. 

        6.15    Survival of Representations and Warranties.    All of the
representations, warranties and covenants of the parties contained in this Agreement shall survive the Closing for a period of eighteen (18) months thereafter. 

        6.16    Key-Man Insurance.    The Company shall have in
effect key-man life insurance policies for each of Paul Laikind and Mark Erion in the amount of $1,000,000 for each, naming the Company as beneficiary. 

        6.17    Waiver of Conflicts.    Each party to this Agreement
acknowledges that Cooley Godward, counsel to the Company, has in the past represented and may now or in the future represent one or more of the Purchasers or their affiliates in matters unrelated to
the transactions contemplated by this Agreement (the "Financing"), including representation of such Purchasers or their affiliates in the Company's
Series C Preferred Stock financing and in other matters of a similar nature to the Financing. The applicable rules of professional conduct require that Cooley Godward inform the parties
hereunder of this representation and obtain their consent. Cooley 

11

 

Godward
has served as counsel to the Company and has negotiated the terms of the Financing solely on behalf of the Company. The Company and each Purchaser hereby (i) acknowledge that they have
had an opportunity to ask for and have obtained information relevant to such representation, including disclosure of the reasonably foreseeable adverse consequences of such representation;
(ii) acknowledge that with respect to the Financing, Cooley Godward has represented solely the Company, and not any Purchaser or any stockholder, director or employee of the Company or any
Purchaser; and (iii) gives its informed written consent to Cooley Godward's representation of the Company in the Financing. 

        6.18    Tax Matters.    Notwithstanding anything herein to the
contrary, any party to this Agreement (and any employee, representative, or other agent of any party to this Agreement) may disclose to any and all persons, without limitation of any kind, the tax
treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to it relating to such tax
treatment and tax structure; provided however, that such disclosure may not be made to the extent reasonably necessary to comply with any applicable federal or state securities laws. For the purposes
of the foregoing sentence, (i) the "tax treatment" of a transaction means the purported or claimed federal income tax treatment of the transaction and (ii) the "tax structure" of a
transaction means any fact that may be relevant to understanding the purported or claimed federal income tax treatment of the transaction. Thus, for the avoidance of doubt, the parties acknowledge and
agree that the tax treatment and tax structure of any transaction does not include the name of any party to a transaction or any sensitive business information (including, without limitation, the name
and other specific information about any party's intellectual property or other proprietary assets) unless such information may be related or relevant to the purported or claimed federal income tax
treatment of the transaction. 

        6.19    Signatory Capacity.    With respect to its signatory capacity
and liability as the trustee of the Wellcome Trust, the Wellcome Trust Limited (the "Trustee") enters into this Agreement in its capacity as the trustee
for the time being of the Wellcome Trust but not otherwise and it is hereby agreed and declared that notwithstanding anything to the contrary contained or implied in this Agreement: 

        (a)   the obligations incurred by the Trustee under or in consequence of this Agreement shall be enforceable against it or the
other trustees of the Wellcome Trust from time to time; and 

        (b)   the liabilities of the Trustee (or such other trustees as are referred to in paragraph (a) above) in respect of
such obligations shall be limited to such liabilities as can, and may lawfully and properly be
met out of the assets of the Wellcome Trust for the time being in the hands or under the control of the Trustee or such other trustees. 

12

        The parties have executed this Series E Preferred Stock Purchase Agreement as of the date first written above. 

	 	 	COMPANY:
	

 	
 	

METABASIS THERAPEUTICS, INC.
	

 	
 	
By:	

/s/  PAUL K. LAIKIND      
 Paul K. Laikind, Chief Executive Officer

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

MPM BIOVENTURES II, L.P.
	

 	
 	
By:	

MPM Asset Management II, L.P., its General Partner
	

 	
 	

By:	

MPM Asset Management II LLC, its General Partner
	

 	
 	

By:	

/s/  LUKE B. EVNIN      

	

 	
 	

Name:	
Luke B. Evnin

	

 	
 	

Title:	
Manager

	

 	
 	
MPM BIOVENTURES II-QP, L.P.
	

 	
 	
By:	

MPM Asset Management II, L.P., its General Partner
	

 	
 	

By:	

MPM Asset Management II LLC, its General Partner
	

 	
 	

By:	

/s/  LUKE B. EVNIN      

	

 	
 	

Name:	
Luke B. Evnin

	

 	
 	

Title:	
Manager

	

 	
 	
MPM BIOVENTURES GMBH & CO. PARALLEL-BETEILIGUNGS KG
	

 	
 	
By:	

MPM Asset Management II, L.P., in its capacity as the Special Limited Partner
	

 	
 	

By:	

MPM Asset Management II LLC, its General Partner
	

 	
 	

By:	

/s/  LUKE B. EVNIN      

	

 	
 	

Name:	
Luke B. Evnin

	

 	
 	

Title:	
Manager

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

MPM ASSET MANAGEMENT INVESTORS 2000 B LLC
	

 	
 	
By:	

/s/  LUKE B. EVNIN      

	

 	
 	

Name:	
Luke B. Evnin

	

 	
 	

Title:	
Manager

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

INTERWEST PARTNERS VII, L.P.
	

 	
 	
By:	

/s/  W. STEPHEN HOLMES      

	

 	
 	

Name:	
W. Stephen Holmes

	

 	
 	

Title:	
Managing Director

	

 	
 	
INTERWEST INVESTORS VII, L.P.
	

 	
 	
By:	

/s/  W. STEPHEN HOLMES      

	

 	
 	

Name:	
W. Stephen Holmes

	

 	
 	

Title:	
Managing Director

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

DLJ CAPITAL CORP.
	

 	
 	

/s/  KATHLEEN LAPORTE      

	 	 	By:	Kathleen LaPorte
	 	 	Its:	Managing Director
	

 	
 	
SPROUT ENTREPRENEURS FUND, L.P.
	

 	
 	

By:	

DLJ Capital Corp.
	 	 	Its:	General Partner
	

 	
 	

/s/  KATHLEEN LAPORTE      

	 	 	By:	Kathleen LaPorte
	 	 	Its:	Managing Director
	

 	
 	
SPROUT CAPITAL IX, L.P.
	

 	
 	

By:	

DLJ Capital Corp.
	 	 	Its:	Managing General Partner
	

 	
 	

/s/  KATHLEEN LAPORTE      

	 	 	By:	Kathleen LaPorte
	 	 	Its:	Managing Director
	

 	
 	
SPROUT IX PLAN INVESTORS, L.P.
	

 	
 	

By:	

DLJ LBO Plans Management Corporation II
	 	 	Its:	General Partner
	

 	
 	

/s/  KATHLEEN LAPORTE      

	 	 	By:	Kathleen LaPorte
	 	 	Its:	Attorney in fact

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

HEINZ W. GSCHWEND & CYNTHIA T. HEALY, TRUSTEES OF THE H.W. GSCHWEND & C.T. HEALY REVOCABLE TRUST
	

 	
 	

/s/  HEINZ W. GSCHWEND      

	 	 	By:	Heinz W. Gschwend, Trustee

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

LB I GROUP INC.
	

 	
 	

By:	

/s/  JOHN CHAMBERS      

	 	 	Name:	John Chambers

	 	 	Title:	Managing Director

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

WELLCOME TRUST LIMITED, AS TRUSTEE OF THE WELLCOME TRUST
	

 	
 	

/s/  GARY STEINBERG      

	 	 	By:	Gary Steinberg
	 	 	 	Chief Investment Officer

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

ITOCHU CORPORATION
	

 	
 	

/s/  EIZO KOBAYASHI      

	 	 	By:	Eizo Kobayashi
	 	 	 	Managing Director

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

MAVERICK FUND, L.D.C.
	

 	
 	

By:	

Maverick Capital, Ltd.
	 	 	Its:	Investment Advisor
	

 	
 	

By:	

/s/  SHARYL ROBERTSON      

	

 	
 	

Name:	
Sharyl Robertson

	

 	
 	

Title:	
CFO

	

 	
 	
MAVERICK FUND USA, LTD.
	

 	
 	

By:	

Maverick Capital, Ltd.
	 	 	Its:	Investment Advisor
	

 	
 	

By:	

/s/  SHARYL ROBERTSON      

	

 	
 	

Name:	
Sharyl Robertson

	

 	
 	

Title:	
CFO

	

 	
 	
MAVERICK FUND II, LTD.
	

 	
 	

By:	

Maverick Capital, Ltd.
	 	 	Its:	Investment Advisor
	

 	
 	

By:	

/s/  SHARYL ROBERTSON      

	 	 	Name:	Sharyl Robertson

	

 	
 	

Title:	
CFO

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

	 	 	PURCHASERS:
	

 	
 	

PAN-PACIFIC VENTURE CAPITAL CO., LTD.
	

 	
 	

By:	

/s/  DAVID Y. S. CHAO      

	

 	
 	

Name:	
David Y. S. Chao

	

 	
 	

Title:	
President

[SIGNATURE PAGE TO SERIES E PREFERRED STOCK PURCHASE AGREEMENT] 

EXHIBITS  

	Exhibit A	 	—	 	Schedule of Purchasers
	Exhibit B	 	—	 	Form of Amended and Restated Certificate of Incorporation
	Exhibit C	 	—	 	Schedule of Exceptions to Representations and Warranties
	Exhibit D	 	—	 	Form of Amended and Restated Investors' Rights Agreement
	Exhibit E	 	—	 	Form of Amended and Restated Co-Sale Agreement
	Exhibit F	 	—	 	Form of Proprietary Information and Inventions Agreement
	Exhibit G	 	—	 	Form of Legal Opinion

   EXHIBIT A

SCHEDULE OF PURCHASERS  

	Purchaser Name and Address
 
	 	Cash Consideration
	 	Past Services

Consideration
	 	Total Consideration
	 	Shares of

Series E Preferred

Stock

	MPM Bioventures II, L.P.

Attn: Luke Evnin

111 Huntington Avenue

31st Floor

Boston, MA 02199	 	$	534,960.40	 	 	—	 	$	534,960.40	 	514,385
	MPM Bioventures II-QP, L.P.

Attn: Luke Evnin

111 Huntington Avenue

31st Floor

Boston, MA 02199	 	$	4,847,039.60	 	 	—	 	$	4,847,039.60	 	4,660,615
	MPM Bioventures GmbH & Co.

Parallel-Beteiligungs KG

Attn: Luke Evnin

111 Huntington Avenue

31st Floor

Boston, MA 02199	 	$	1,706,399.76	 	 	—	 	$	1,706,399.76	 	1,640,769
	MPM Asset Management

Investors 2000 B LLC

Attn: Luke Evnin

111 Huntington Avenue

31st Floor

Boston, MA 02199	 	$	111,600.32	 	 	—	 	$	111,600.32	 	107,308
	InterWest Partners VII, L.P.

2710 Sand Hill Road

Second Floor

Menlo Park, CA 94025	 	$	4,151,205.76	 	 	—	 	$	4,151,205.76	 	3,991,544
	InterWest Investors VII, L.P.

2710 Sand Hill Road

Second Floor

Menlo Park, CA 94025	 	$	198,794.96	 	 	—	 	$	198,794.96	 	191,149
	DLJ Capital Corp.

3000 Sand Hill Road

Building 3, Suite 170

Menlo Park, CA 94025	 	$	36,390.16	 	 	—	 	$	36,390.16	 	35,279
	Sprout IX Plan Investors, L.P.

3000 Sand Hill Road

Building 3, Suite 170

Menlo Park, CA 94025	 	$	139,772.88	 	 	—	 	$	139,772.88	 	134,397
	Sprout Entrepreneurs Fund, L.P.

3000 Sand Hill Road

Building 3, Suite 170

Menlo Park, CA 94025	 	$	12,065.04	 	 	—	 	$	12,065.04	 	11,601

A-1

 

	Sprout Capital IX, L.P.

3000 Sand Hill Road

Building 3, Suite 170

Menlo Park, CA 94025	 	$	3,061,471.92	 	 	—	 	$	3,061,471.92	 	2,943,723
	Heinz W. Gschwend & Cynthia T. Healy,

Trustees of the H.W. Gschwend & C.T. Healy Revocable Trust

161 Meadowcroft Way

Santa Rosa, CA 95403	 	$	100,000.16	 	 	—	 	$	100,000.16	 	96,154
	LB I Group Inc.

c/o Lehman Brothers Inc.

745 7th Avenue

New York, NY 10019	 	 	—	 	$	93,375.36	 	$	93,375.36	 	89,784
	Wellcome Trust Limited, as Trustee of the Wellcome Trust

183 Euston Road

London NW1 2BE	 	$	3,000,000.64	 	 	—	 	$	3,000,000.64	 	2,884,616
	ITOCHU Corporation

Innovative Technology Business Development Office

Corporate Planning Group 5-1, Kita-Aoyama 2-chome, Minato-ku, Tokyo 107-8077, Japan	 	$	1,000,000.56	 	 	—	 	$	1,000,000.56	 	961,539
	Maverick Fund, L.D.C.

c/o Maverick Capital, Ltd.

300 Crescent Court, 18th Floor

Dallas, TX 75201

Attention: John T. McCafferty

Facsimile: (214) 880-4042

with a copy to:

Jones Day

2727 North Harwood Street

Dallas, TX 75201

Attention: Stephen L. Fluckiger

Facsimile: (214) 969-5100	 	$	2,982,000.32	 	 	—	 	$	2,982,000.32	 	2,867,308

A-2

 

	Maverick Fund USA, Ltd.

c/o Maverick Capital, Ltd.

300 Crescent Court, 18th Floor

Dallas, TX 75201

Attention: John T. McCafferty

Facsimile: (214) 880-4042

with a copy to:

Jones Day

2727 North Harwood Street

Dallas, TX 75201

Attention: Stephen L. Fluckiger

Facsimile: (214) 969-5100	 	$	1,392,500.72	 	 	—	 	$	1,392,500.72	 	1,338,943
	Maverick Fund II, Ltd.

c/o Maverick Capital, Ltd.

300 Crescent Court, 18th Floor

Dallas, TX 75201

Attention: John T. McCafferty

Facsimile: (214) 880-4042

with a copy to:

Jones Day

2727 North Harwood Street

Dallas, TX 75201

Attention: Stephen L. Fluckiger

Facsimile: (214) 969-5100	 	$	625,499.68	 	 	—	 	$	625,499.68	 	601,442
	Pan-Pacific Venture Capital Co., Ltd.

6F, No. 21, Lane 120, Neihu Road, Sec. 1

Taipei, 114, Taiwan, R.O.C.

Facsimile: 886-2-8751-1212	 	$	1,000,000.56	 	 	—	 	$	1,000,000.56	 	961,539
	 	 	
	 	
	 	
	 	

	Totals:	 	$	24,900,003.44	 	$	93,375.36	 	$	24,993,378.80	 	24,032,095
	 	 	
	 	
	 	
	 	

A-3

EXHIBIT B  

 FORM OF AMENDED AND RESTATED

CERTIFICATE OF INCORPORATION  

EXHIBIT C  

 SCHEDULE OF EXCEPTIONS  

EXHIBIT D  

 FORM OF AMENDED AND RESTATED

INVESTORS' RIGHTS AGREEMENT  

EXHIBIT E  

 FORM OF AMENDED AND RESTATED

CO-SALE AGREEMENT  

EXHIBIT F  

 FORM OF PROPRIETARY INFORMATION

AND INVENTIONS AGREEMENT  

EXHIBIT G  

 FORM OF LEGAL OPINION  

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Exhibit 4.11    
    

        METABASIS THERAPEUTICS, INC.  

 AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT  

 DATED AS OF OCTOBER 28, 2003  

 
 METABASIS THERAPEUTICS, INC.

AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT  

        THIS AMENDED AND RESTATED INVESTORS' RIGHTS AGREEMENT is made as of October 28, 2003 (the  "Effective
Date") by and among METABASIS THERAPEUTICS, INC., a Delaware corporation (the  "Company"), and the investors listed
on Exhibit A hereto, including, without limitation,  SICOR INC., a Delaware corporation ("SICOR"), and SANKYO
COMPANY, LTD., a Japanese corporation ("Sankyo"), each of which is herein
referred to as an "Investor." 

RECITALS  

        WHEREAS, certain Investors are holders of shares of the Company's Series A Preferred Stock, Series B
Preferred Stock, Series C Preferred Stock, Series D Preferred Stock or securities and/or debt convertible thereinto (the "Prior Parties")
and possess registration rights, information rights and other rights pursuant to that certain Amended and Restated Investor Rights Agreement dated as of October 18, 2001, by and among the
Company, SICOR, Sankyo and such other Prior Parties (the "Prior Agreement"); and 

        WHEREAS, the undersigned Prior Parties desire to amend and restate in its entirety the Prior Agreement and to accept the rights created
pursuant hereto in lieu of the rights granted to them under the Prior Agreement; and 

        WHEREAS, certain other Investors are parties to the Series E Preferred Stock Purchase Agreement dated as of the Effective Date
between the Company and such Investors (the "Purchase Agreement"), such Investors' obligations under which are conditioned upon, among other things, the
execution and delivery of this Agreement. 

        NOW, THEREFORE, in consideration of the mutual promises and covenants set forth herein, the parties to the Prior Agreement hereby agree
that the Prior Agreement shall be superseded and replaced in its entirety by this Agreement, and the parties hereto further agree as follows: 

        1.    INFORMATION RIGHTS.    

        1.1    Financial Information.    

        (a)   The Company shall deliver to each Investor who continues to hold shares of Series A Preferred Stock
("Series A Preferred Stock") of the Company (or the common stock of the Company ("Common Stock")
into which the shares of Series A Preferred Stock have been converted), shares of Series B Preferred Stock ("Series B Preferred
Stock") of the Company (or the Common Stock into which the shares of Series B Preferred Stock have been converted), shares of Series C Preferred Stock
("Series C Preferred Stock") of the Company (or the Common Stock into which shares of Series C Preferred Stock have been converted),
shares of Series D Preferred Stock ("Series D Preferred Stock") of the Company (or the Common Stock into which the shares of
Series D Preferred Stock have been converted) or shares of Series E Preferred Stock ("Series E Preferred Stock") of the Company (or
the Common Stock into which the shares of Series E Preferred Stock have been converted) (in each case as adjusted for any stock split, stock dividends, combinations, recapitalizations and the
like with respect to such shares), and as long as such Investor or a principal, partner or manager of such Investor, is not employed by or an officer or director of a competitor of the Company,
audited financial statements, prepared in accordance with United States generally accepted accounting principles ("GAAP"), consistently applied, and
setting forth in comparative form the figures for the previous year, all in reasonable detail, of the Company, as soon as practicable after the end of each fiscal year of the Company and in any event
within 90 days after the close of each fiscal year. 

        (b)   The Company shall deliver to each Investor who continues to hold shares of Series A, Series B,
Series C, Series D or Series E Preferred Stock (or the Common Stock into which shares 

1

 

of
Series A, Series B, Series C, Series D or Series E Preferred Stock have been converted) (as adjusted for any stock split, stock dividends, combinations,
recapitalizations and the like with respect to such shares), and as long as such Investor or a principal, partner or manager of such Investor, is not employed by or an officer or director of a
competitor of the Company, within 30 days after the end of each fiscal quarter of the Company, unaudited quarterly financial statements prepared in accordance with GAAP, consistently applied. 

        (c)   The Company will deliver to each Investor who continues to hold Series A or Series B Preferred Stock (or
the Common Stock into which shares of Series A or Series B Preferred Stock have been converted) (as adjusted for any stock split, stock dividends, combinations, recapitalizations and the
like with respect to such shares) within 30 days prior to the beginning of each fiscal year, a capitalization summary, annual budget and operating plans for such fiscal year (and as soon as
available, any subsequent revisions thereto), and within 30 days after the end of each month, monthly unaudited financial statements with comparisons against the Company's operating plan;  provided, however,
 that to the extent that the Company reasonably concludes that disclosure of the specific budget/operating plan line items,
corresponding dollar amounts and comparisons would provide the holders of Series A and Series B Preferred Stock (or the Common Stock into which shares of Series A or
Series B Preferred Stock have been converted) (as adjusted for any stock split, stock dividends, combinations, recapitalizations and the like with respect to such shares) with competitively
sensitive information regarding the Company's allocation of resources, the Company shall not be obligated to disclose such information to the holders of Series A or Series B Preferred
Stock on a line-item basis but shall disclose such information on an aggregate basis. 

        (d)   The Company shall deliver to each Investor who continues to hold at least 1,000,000 shares of Series C Preferred
Stock (or 1,000,000 shares of the Common Stock into which shares of Series C Preferred Stock have been converted or a combination of such Series C Preferred Stock and Common Stock), at
least 1,000,000 shares of Series D Preferred Stock (or 1,000,000 shares of the Common Stock into which shares of Series D Preferred Stock have been converted or a combination of such
Series D Preferred Stock and Common Stock) or at least 1,000,000 shares of Series E Preferred Stock (or 1,000,000 shares of the Common Stock into which shares of Series E
Preferred Stock have been converted or a combination of such Series E Preferred Stock and Common Stock) (in each case, as adjusted for any stock split, stock dividends, combinations,
recapitalizations and the like with respect to such shares), and as long as such Investor or a principal, partner or manager of such Investor, is not employed by or an officer or director of a
competitor of the Company within 30 days prior to the beginning of the Company's next fiscal year, a copy of the Company's annual operating plan for the next fiscal year, and within
30 days after the end of each month, monthly unaudited financial statements with comparisons against the Company's annual operating plan. 

        (e)   For purposes of this Section 1.1, a "competitor of the Company"
means any entity that engages in the business of human therapeutic drug development, research, distribution or related business (the "Business"),
provided that the Board of Directors of the Company may in their reasonable and good faith discretion exempt any individual entity from such definition through board action that defines the
duration and scope of such exemption, and provided further that no Investor that is a financial investor shall be deemed to be a competitor of the Company due to its having made an investment in, or
due to the service of one or more of its principals or employees on the board of directors of, a competitor of the Company. 

        1.2    Inspection Rights.    Each Investor shall have the right to
visit and inspect any of the properties of the Company or any of its subsidiaries, and to discuss the affairs, finances and accounts of the Company or any of its subsidiaries with its officers, and to
review such information as is reasonably requested all at such reasonable times and as often as may be reasonably 

2

 

requested;  provided, however, that the Company shall not be obligated under this Section 1.2 with respect to a competitor of the Company or with
respect to information which the Board of Directors determines in good faith is confidential and should not, therefore, be disclosed, unless the Investor first executes and delivers a confidentiality
agreement with the Company in form and substance reasonably satisfactory to the Board of Directors; provided further that, whenever requested, the Investor shall sign an agreement satisfactory to the
Company stating that the Investor shall hold all such information in confidence. 

        1.3    Confidentiality of Records.    Each Investor hereby represents,
warrants and covenants that it shall maintain in confidence, and shall not use or disclose without the prior written consent of the Company, any information identified in writing as confidential that
is furnished to it by the Company in connection with this Agreement. This obligation of confidentiality shall not apply, however, to any information (i) in the public domain through no
unauthorized act or failure to act by the Investor, (ii) lawfully disclosed to the Investor by a third party who possessed such information without any obligation of confidentiality,
(iii) known to the Investor at the time of disclosure by the Company, as evidenced by records of the Investor in existence at the time of the disclosure in question, (iv) which has been
independently developed by employees or other agents of, or independent contractors hired by, the Investor without access to the information described in the first sentence of this Section 1.3
or (v) that is required to be disclosed pursuant to applicable law or stock exchange regulations. Each Investor further covenants that it shall return to the Company all tangible materials in
the possession of such Investor, or affiliates of such Investor containing such information upon request by the Company. Each Investor agrees that it will restrict access to the confidential
information of the Company among its officers, directors, employees, financial and legal advisors and to those persons with a need to use such information and who are parties to agreements with such
Investor to maintain such information as confidential (or otherwise subject to obligations to maintain such information as confidential). 

        1.4    Termination of Covenants.    Except as required by law, the
rights set forth in Sections 1.1 and 1.2 shall terminate and be of no further force or effect upon the closing of a Qualified IPO, as defined below, of the Company's Common Stock pursuant to an
effective registration statement filed by the Company under the Securities Act of 1933, as amended (the "Securities Act"), or on the date the Company
otherwise becomes subject to the reporting requirements under Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), whichever first occurs. Furthermore, for purposes of the holders of Series A and Series B Preferred Stock, the rights set forth in Sections 1.2 and 1.3
shall also terminate upon the later to occur of (i) January 10, 2005 or (ii) the date on which Sankyo, and its affiliates (taken as a whole) cease to own fifty (50%) of the
outstanding Series A Preferred
Stock and Series B Preferred Stock (or shares of Common Stock received on conversion thereof), collectively, by virtue of the exercise of the Exchange Right, as defined below, or otherwise. 

        1.5    Use of Proceeds.    The Company shall use the proceeds from the
sale of Common Stock sold pursuant to the Stock Purchase Agreement, dated December 18, 1997, by and among the Company, SICOR and Sankyo solely (i) in connection with the Company's
obligations under the Amended and Restated Collaborative Research and Development and License Agreement, dated as of June 30, 1999, (the "R&D
Agreement"), between the Company and Sankyo, (ii) for general working capital purposes, but not for the repayment of debt and (iii) to pay $2,250,000 payable to
SICOR pursuant to the terms of the Asset and Liability Transfer Agreement dated as of December 17, 1997 between the Company and SICOR. The covenants of the Company contained in this
Section 1.5 shall expire and terminate upon the expiration of the Research Program Term (as defined in the R&D Agreement). 

3

 

        2.    REGISTRATION RIGHTS.    The Company and the Investors covenant
and agree as follows: 

        2.1    Definitions.    For purposes of this Section 2: 

        (a)   The terms "register," "registered," and  "registration" refer to a registration
effected by preparing and filing a registration statement or similar document in compliance with the Securities
Act, and the declaration or ordering of effectiveness of such registration statement or document. 

        (b)   The term "Registrable Securities" means (i) the shares of Common
Stock issuable or issued upon conversion of the Series A Preferred Stock, Series B Preferred Stock, Series C Preferred Stock, Series D Preferred Stock and Series E
Preferred Stock and (ii) any other shares of Common Stock of the Company issued as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a
dividend or other distribution with respect to, or in exchange for or in replacement of, the shares listed in (i); or (iii) other shares of Common Stock acquired by a holder of Registrable
Securities; provided, however, that the foregoing definition shall exclude in all cases any Registrable Securities sold by a person in a transaction in
which his or her rights under this Agreement are not assigned. Notwithstanding the foregoing, Common Stock or other securities shall only be treated as Registrable Securities if and so long as they
have not been (A) sold to or through a broker or dealer or underwriter in a public distribution or a public securities transaction, or (B) sold in a transaction exempt from the
registration and prospectus delivery requirements of the Securities Act under Section 4(1) thereof so that all transfer restrictions, and restrictive legends with respect thereto, if any, are
removed upon the consummation of such sale. 

        (c)   The number of shares of "Registrable Securities then outstanding" shall
be determined by the number of shares of Common Stock outstanding which are, and the number of shares of Common Stock issuable pursuant to then exercisable or convertible securities which are,
Registrable Securities;  provided, however, that the foregoing definition shall exclude in all cases any securities sold by a person in a transaction in which his or her rights
under this Agreement are not assigned, and any securities that have been (A) sold to or through a broker or dealer or underwriter in a public distribution or a public securities transaction, or
(B) sold in a transaction exempt from the registration and prospectus delivery requirements of the Securities Act under Section 4(1) thereof so that all transfer restrictions, and
restrictive legends with respect thereto, if any, are removed upon the consummation of such sale. 

        (d)   The term "Series A Holder" means any person owning or having the
right to acquire (i) the shares of Common Stock issuable or issued upon conversion of the Series A Preferred Stock and (ii) any other shares of Common Stock of the Company issued
as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of,
the shares listed in (i). 

        (e)   The term "Series B Holder" means any person owning or having the
right to acquire (i) the shares of Common Stock issuable or issued upon conversion of the Series B Preferred Stock and (ii) any other shares of Common Stock of the Company issued
as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of,
the shares listed in (i). 

        (f)    The term "Series C Holder" means any person owning or having the
right to acquire (i) the shares of Common Stock issuable or issued upon conversion of the Series C Preferred Stock and (ii) any other shares of Common Stock of the Company issued
as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of,
the shares listed in (i). 

        (g)   The term "Series D Holder" means any person owning or having the
right to acquire (i) the shares of Common Stock issuable or issued upon conversion of the Series D Preferred 

4

 

Stock
and (ii) any other shares of Common Stock of the Company issued as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or
other distribution with respect to, or in exchange for or in replacement of, the shares listed in (i). 

        (h)   The term "Series E Holder" means any person owning or having the
right to acquire (i) the shares of Common Stock issuable or issued upon conversion of the Series E Preferred Stock and (ii) any other shares of Common Stock of the Company issued
as (or issuable upon the conversion or exercise of any warrant, right or other security which is issued as) a dividend or other distribution with respect to, or in exchange for or in replacement of,
the shares listed in (i). 

        (i)    The term "Preferred Holders" means the Series A Holders, the
Series B Holders, the Series C Holders, the Series D Holders and the Series E Holders. 

        (j)    The term "Form S-3" means such form under the
Securities Act as in effect on the date hereof or any successor form under the Securities Act. 

        (k)   The term "SEC" means the Securities and Exchange Commission of the United
States. 

        (l)    The term "Qualified IPO" means a firm commitment underwritten public
offering by the Company of shares of its Common Stock pursuant to a registration statement on Form S-1 under the Securities Act, in which the public offering price per share of
Common Stock is at least $2.00 (as adjusted for stock splits, stock dividends, combinations, recapitalizations and the like) and the gross proceeds to the Company are not less than $25,000,000 (before
underwriting discounts, commissions and fees). 

        2.2    Request for Registration.    

        (a)   If the Company shall receive at any time at least six (6) months after the effective date of the first
registration statement for a public offering of securities of the Company (other than a registration statement relating either to the sale of securities to employees of the Company pursuant to a stock
option, stock purchase or similar plan or an SEC Rule 145 transaction), a written request from the holders of a majority of the Registrable Securities held by the Preferred Holders, on an
as-converted basis and including any shares of Common Stock held by the Preferred Holders resulting from conversion of their respective Preferred Stock, that the Company file a
registration statement under the Securities Act covering Registrable Securities, then the Company shall, within ten (10) days of the receipt thereof, give written notice of such request to all
Preferred Holders and shall, subject to the limitations of subsection 2.2(b), use commercially reasonable efforts to effect as soon as practicable, and in any event within 90 days of the
receipt of such request, the registration under the Securities Act of all Registrable Securities which the Preferred Holders request to be registered within twenty (20) days of the mailing of
such notice by the Company in accordance with the terms hereof; provided, however, that the Company shall not be obligated to effect such registration
if the Preferred Holders, together with the holders of any other securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities
(if any) at an aggregate price to the public (before underwriting discounts, commissions and fees) of less than $5,000,000. 

        (b)   If the Preferred Holders initiating the registration request hereunder ("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 this Section 2.2 and the Company shall include such information in the written notice referred to in subsection 2.2(a). The underwriter will be selected by the Company subject to
the prior written consent of a majority of the then outstanding Registrable Securities proposed to be included in such registration, which consent shall not be unreasonably withheld; provided,
however, that no such consent shall be required if the Company selects a nationally recognized underwriter in the United States with demonstrable, pharmaceutical and/or biotechnology industry-specific
expertise 

5

 

and
experience. In such event, the right of any Preferred Holder to include Registrable Securities in such registration shall be conditioned upon such Preferred Holder's participation in such
underwriting and the inclusion of such Preferred Holder's Registrable Securities in the underwriting (unless otherwise mutually agreed by a majority in interest of the Initiating Holders and such
Preferred Holder to the extent provided herein. All Preferred Holders proposing to distribute their securities through such underwriting shall (together with the Company as provided in subsection
2.5(e)) enter into an underwriting agreement in customary form (including without limitation the indemnities from the Company as set forth in Section 2.10) with the underwriter or underwriters
selected for such underwriting. Notwithstanding any other provision of this Section 2.2, if the underwriter advises the Initiating Holders in writing that marketing factors require a limitation
or the exclusion of the number of shares to be underwritten, then the Initiating Holders shall so advise all Preferred Holders of Registrable Securities which would otherwise participate in the
underwritten offering pursuant hereto, and, in the case of a limitation, of the number of shares of Registrable Securities that may be included in the underwriting shall be allocated among all
Preferred Holders (as applicable), including the Initiating Holders, in proportion (as nearly as practicable) to the amount of Registrable Securities of the Company owned by each Preferred Holder (as
applicable); provided, however, that the shares of Registrable Securities to be included in such underwriting shall not be reduced in number or
completely excluded unless all other securities are first entirely excluded from the underwriting. No such reduction shall reduce the securities being offered by the Company for its own account to be
included in the registration and underwriting, and in no event shall the amount of Registrable Securities of the selling Preferred Holders included in the registration be reduced below
twenty-five (25%) of the total amount of securities included in such registration, unless such offering is the initial public offering of the Company's Common Stock under the Securities
Act, in which event any or all of the Registrable Securities of the Preferred Holders may be excluded in accordance with this Section 2.2(b). 

        (c)   Notwithstanding the foregoing, if the Company shall furnish to the Initiating Holders requesting a registration statement
pursuant to this Section 2.2, a certificate signed by the President of the Company stating that in the good faith judgment of the Board of Directors of the Company, it would be seriously
detrimental to the Company and its stockholders for such registration statement to be filed at such time and it is therefore essential to defer the filing of such registration statement, the Company
shall have the right to defer such filing for a period of not more than 90 days after receipt of the request of the Initiating Holders; provided,
however, that the Company may not utilize this right more than once in any twelve month period. 

        (d)   In addition, the Company shall not be obligated to effect, or to take any action to effect, any registration pursuant to
this Section 2.2: 

          (i)  After the Company has effected two (2) registrations pursuant to this Section 2.2 and such registrations
have been declared or ordered effective (excluding any such registration in which the amount of the Registrable Securities of the selling Preferred Holders included therein shall have been reduced by
twenty-five percent (25%) or more to accommodate the inclusion of the securities being offered by the Company pursuant to Section 2.2(b)), or within six (6) months of the
effective date of another registration; 

         (ii)  During the period of one hundred eighty (180) days following the effective date of a registration subject to
Section 2.3 hereof; 

       (iii)  If the Initiating Holders propose to dispose of shares of Registrable Securities that may be currently registered on
Form S-3 pursuant to a request made pursuant to Section 2.4 below; provided, however, that if the Company so refuses to effect
a registration by the 

6

 

Preferred
Holders pursuant to this Section 2.2(d)(iii), they shall be entitled to an additional registration pursuant to Section 2.4 for each such registration so refused; or 

        (iv)  If the Company delivers notice to the Initiating Holders within thirty (30) days of a registration request
pursuant to this Section 2.2 stating the Company's intent to file a registration statement for a public offering within ninety (90) days of the date of such notice, provided that
the Company is actively employing in good faith all reasonable efforts to cause such registration statement to be filed and become effective. 

        2.3    Company Registration.    If (but without any obligation to do
so) the Company proposes to register (including for this purpose a registration effected by the Company for stockholders other than the Preferred Holders) any of its securities under the Securities
Act in connection with the public offering of such securities solely for cash (other than a registration relating solely to the sale of securities to participants in a Company stock plan or a
transaction covered by Rule 145 under the Securities Act, a registration in which the only stock being registered is Common Stock issuable upon conversion of debt securities which are also
being registered, or any registration on any form which 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), the Company shall, at such time, promptly give each Preferred Holder written notice of such registration. Upon the written request of each Holder given within twenty
(20) days after mailing of such notice by the Company in accordance with the terms hereof, the Company shall, subject to the provisions of Section 2.8, cause to be registered under the
Securities Act all of the Registrable Securities that each such holder has requested to be registered. 

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

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

        (b)   as soon as practicable, effect such registration and all such qualifications and compliances as may be so requested and
as would permit or facilitate the sale and distribution of all or such portion of such Preferred Holder's Registrable Securities as are specified in such request, together with all or such portion of
the Registrable Securities of any other Preferred Holders joining in such request as are specified in a written request given within 15 days after receipt of such written notice from the
Company; provided, however, that the Company shall not be obligated to effect any such registration, qualification or compliance, pursuant to this
Section 2.4: (i) if Form S-3 is not available for such offering by the Preferred Holders; (ii) if the Preferred Holders, together with the holders of any other
securities of the Company entitled to inclusion in such registration, propose to sell Registrable Securities and such other securities (if any) at an aggregate price to the public (net of any
underwriters' discounts or commissions) of less than $500,000; (iii) if the Company shall furnish to the Preferred Holders a certificate signed by the President of the Company stating that in
the good faith judgment of the Board of Directors of the Company, it would be seriously detrimental to the Company and its stockholders for such Form S-3 Registration to be effected
at such time, in which event the Company shall have the right to defer the filing of the Form S-3 registration statement for a period of not more than 90 days after receipt
of the request of the Preferred Holders under this Section 2.4; provided, however, that the Company shall not utilize this right more than once
in any twelve month period; (iv) if the Company has, within the twelve (12) month period preceding the date of such request, already effected two (2) registrations on
Form S-3 for such holders pursuant to this Section 2.4 or within six (6) months of the effective date of another registration; (v) in any particular
jurisdiction in which the Company would be 

7

 

required
to qualify to do business or to execute a general consent to service of process in effecting such registration, qualification or compliance; or (vi) during the period ending one
hundred eighty (180) days after the effective date of a registration statement subject to Section 2.3. 

        (c)   Subject to the foregoing, the Company shall file a registration statement covering the Registrable Securities and
other securities so requested to be registered as soon as practicable after receipt of the request or requests of the Preferred Holders. Registrations effected pursuant to this Section 2.4
shall not be counted as demands for registration or registrations effected pursuant to Sections 2.2 or 2.3, respectively. 

        (d)   If the registration is to be underwritten, the underwriter will be selected by the Company subject to the prior written
consent of a majority of the holders of the then outstanding Registrable Securities
proposed to be included in such registration, which consent shall not be unreasonably withheld; provided, however, that no such consent shall be required if the Company selects a nationally recognized
underwriter in the United States with demonstrable, pharmaceutical and/or biotechnology industry-specific expertise and experience. 

        2.5    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 best
efforts to cause such registration statement to become effective, and, upon the request of the Holders of a majority of the Registrable Securities registered thereunder, keep such registration
statement effective for up to one hundred twenty (120) days. 

        (b)   Prepare and file with the SEC such amendments and supplements to such registration statement and the prospectus used in
connection with such registration statement as may be necessary to comply with the provisions of the Securities Act with respect to the disposition of all securities covered by such registration
statement for up to one hundred twenty (120) days. 

        (c)   Furnish to each Preferred Holder covered by such registration statement such numbers of copies of a prospectus, including
a preliminary prospectus, in conformity with the requirements of the Securities Act, and such other documents as they may reasonably request in order to facilitate the disposition of Registrable
Securities owned by them. 

        (d)   Use its best 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 Preferred Holders covered by such registration statement,  provided that the Company shall not be required in
connection therewith or as a condition thereto to qualify to do business or to file a general
consent to service of process in any such states or jurisdictions. 

        (e)   In the event of any underwritten public offering, enter into and perform its obligations under an underwriting agreement,
in usual and customary form (including without limitation the indemnities from the Company as set forth in Section 2.10), with the managing underwriter of such offering. Each Preferred Holder
participating in such underwriting shall also enter into and perform its obligations under such an agreement. 

        (f)    Notify each Preferred Holder of Registrable Securities covered by such registration statement at any time when a
prospectus relating thereto is required to be delivered under the Securities Act of the happening of any event as a result of which the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state a material fact required to be stated therein or necessary to make the statements therein not misleading in the light of the
circumstances then existing, such obligation to continue for one hundred twenty (120) days. In such event, the Company shall use all reasonable efforts to amend 

8

 

promptly
the registration statement to conform the prospectus to the requirement of the Securities Act and applicable regulations. 

        (g)   Cause all such Registrable Securities registered pursuant hereunder to be listed on each securities exchange on which
similar securities issued by the Company are then listed. 

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

        (i)    Use its best efforts to furnish, at the request of any Preferred Holder requesting registration of Registrable Securities
pursuant to this Section 2, on the date that such Registrable Securities are delivered to the underwriters for sale in connection with a registration pursuant to this Section 2, if such
securities are being sold through underwriters, or, if such securities are not being sold through underwriters, on the date that the registration statement with respect to such securities becomes
effective, (i) an opinion, dated such date, of the counsel representing the Company for the purposes of such registration, in form and substance as is customarily given to underwriters in an
underwritten public offering, addressed to the underwriters, if any, and to the Preferred Holders requesting registration of Registrable Securities and (ii) a letter dated such date, from the
independent certified public accountants of the Company, in form and substance as is customarily given by independent certified public accountants to underwriters in an underwritten public offering,
addressed to the underwriters, if any, and to the Preferred Holders requesting registration of Registrable Securities. 

        2.6    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 Preferred 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 shall be required to effect the registration of such
holder's Registrable Securities. The Company shall have no obligation with respect to any registration requested pursuant to Section 2.2 or Section 2.4 of this Agreement if, as a result
of the application of the preceding sentence, the number of shares or the anticipated aggregate offering price of the Registrable Securities to be included in the registration does not equal or exceed
the number of shares or the anticipated aggregate offering price required to originally trigger the Company's obligation to initiate such registration as specified in subsection 2.2(a) or subsection
2.4(b)(ii), whichever is applicable. 

        2.7    Expenses of Registration.    

        (a)   Demand Registration.    All expenses other than underwriting discounts and commissions, incurred in connection
with two (2) demand registrations, pursuant to Section 2.2, including (without limitation) all registration, filing and qualification fees, printers' and accounting fees, fees and
disbursements of counsel for the Company, and the reasonable fees and disbursements (not to exceed $30,000) of one counsel for the selling Preferred Holders selected by them (collectively
"Registration Expenses") shall be borne by the Company, provided, however, that if the Preferred Holders
bear the Registration Expenses for any registration proceeding begun pursuant to Section 2.2 and subsequently withdrawn by registering shares therein, such registration proceeding shall not be
counted as a requested registration pursuant to Section 2.2 hereof; provided further that in the event that such withdrawal is based upon material adverse information relating to the Company
that is different from the information known or available (upon request from the Company or otherwise) to the Preferred Holders requesting registration at the time of their request for registration
under Section 2.2, such registration shall not be treated as a counted registration for purposes of Section 2.2 hereof, even though the Preferred Holders do not bear the Registration
Expenses for such registration. 

9

 

        (b)   Company Registration.    All expenses other than underwriting discounts and commissions incurred in connection
with registrations, filings or qualifications of Registrable Securities pursuant to Section 2.3 for each Preferred Holder (which right may be assigned as provided in Section 2.12),
including (without limitation) all registration, filing, and qualification fees, printers' and accounting fees, fees and disbursements of counsel for the Company and the reasonable fees and
disbursements (not to exceed $30,000) of one counsel for the selling Preferred Holders selected by them shall be borne by the Company. 

        (c)   Registration on Form S-3.    All expenses other than underwriting discounts and commissions
incurred in connection with two (2) registrations requested pursuant to Section 2.4, including (without limitation) all registration, filing, qualification, printers' and accounting fees
and the reasonable fees and disbursements (not to exceed $30,000) of one counsel for the selling Preferred Holders selected by them shall be borne by the Company. 

        2.8    Underwriting Requirements.    In connection with any offering
involving an underwriting of shares of the Company's capital stock, the Company shall not be required under Section 2.3 to include any of the Preferred Holders' securities in such underwriting
unless they accept the terms of the underwriting as agreed upon between the Company and the underwriters selected by it (or by other persons entitled to select the underwriters), provided that such
agreement does not require indemnification by any of them except to the extent contemplated by Section 2.10 hereof. If the total amount of securities, including Registrable Securities,
requested by the Preferred Holders to be included in such offering exceeds the amount of securities sold that the underwriters determine in their sole discretion is compatible with the success of the
offering, then the Company shall be required to include in the offering only that number of such securities, including Registrable Securities, which the underwriters determine in their sole discretion
will not jeopardize the success of the offering. The Company will include in such registration (i) first, the securities the Company proposes to sell for its own account; (ii) second, to
the extent that the number of securities the Company proposes to sell is less than the number of securities which the Company has been advised can be sold in such offering, such number of Registrable
Securities which the Preferred Holders have requested to be included in such registration pursuant to Section 2.3 hereof; provided, however, in
no event will shares of any other selling stockholder be included in such registration which would reduce the number of shares which have been requested to be included by the Preferred Holders (or
completely exclude the shares held by Preferred Holders) without the written consent of a majority of the then outstanding Registrable Securities proposed to be sold in the offering; and
(iii) third, to the extent that the number of securities which are to be included in such registration pursuant to clauses (i) and (ii) is, in the aggregate, less than the number
of securities which the Company has been advised can be sold in such offering, such number of other securities requested to be included in the offering for the account of any holders not contractually
entitled to registration which, in the opinion of the underwriters, is compatible with the success of the offering. The number of Registrable Securities included in such registration statement shall
be allocated pro rata among the holders of Registrable Securities based on the number of Registrable Securities held by each of them or in such other proportions as shall mutually be agreed to by
them, but in no event shall any shares being sold by such a holder exercising a demand registration right similar to that granted in Section 2.2 or 2.4 be excluded from such offering. For
purposes of the preceding sentence concerning apportionment, for any selling stockholder which is a holder of Registrable Securities and which is a partnership or corporation, the partners, retired
partners and stockholders of such holder, or the estates and family members of any such partners and retired partners and any trusts for the benefit of any of the foregoing persons shall be deemed to
be a single "selling stockholder" and any pro-rata reduction with respect to such "selling stockholder" shall be based upon the aggregate amount of shares carrying registration rights
owned by all entities and individuals included in such "selling stockholder," as defined in this sentence. In no event shall the amount of Registrable Securities 

10

 

the
Preferred Holders request to be included in the registration pursuant to Section 2.3 be reduced below twenty-five (25%) of the total amount of securities included in such
registration, unless such offering is the initial public offering of the Company's Common Stock under the Securities Act, in which event any or all of the Registrable Securities of the Preferred
Holders may be excluded in accordance with this Section 2.8. 

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

        2.10    Indemnification.    In the event 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 Preferred Holder, its partners,
officers and directors, its legal counsel, its accountants, any underwriter (as defined in the Securities Act) for such holder and each person, if any, who controls such holder or underwriter within
the meaning of the Securities Act or the Exchange Act, against any losses, claims, damages, or liabilities (joint or several) to which they may become subject under the Securities Act, the Exchange
Act or other federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in respect thereof) arise out of or are based upon any of the following statements, omissions or
violations (collectively a "Violation"): (i) any untrue statement or alleged untrue statement of a material fact contained in such registration
statement, including any preliminary prospectus or final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or alleged omission to state 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 Company of the Securities Act, the Exchange
Act, any state securities law or any rule or regulation promulgated under the Securities Act, the Exchange Act or any state securities law; and the Company will pay to each such holder, partner,
officer, director, underwriter or controlling person, as incurred, any legal or other expenses reasonably incurred by them in connection with investigating or defending any such loss, claim, damage,
liability, or action; provided, however, that the indemnity agreement contained in this subsection 2.10(a) shall not apply to amounts paid in settlement
of any such loss, claim, damage, liability, or action if such settlement is effected without the consent of the Company (which consent shall not be unreasonably withheld), nor shall the Company be
liable to any holder, underwriter or controlling person for any such loss, claim, damage, liability, or action to the extent that it arises out of or is based upon a Violation which occurs in reliance
upon and in conformity with written information furnished expressly for use in connection with such registration by any such holder, underwriter or controlling person. 

        (b)   To the extent permitted by law, each selling Preferred Holder will indemnify and hold harmless the Company, each of its
directors, each of its officers who has signed the registration statement, each person, if any, who controls the Company within the meaning of the Securities Act, its legal counsel, its accountants,
any underwriter, any other holder selling securities in such registration statement and any controlling person of any such underwriter or other holder, against any losses, claims, damages, or
liabilities (joint or several) to which any of the foregoing persons may become subject, under the Securities Act, the Exchange Act or other federal or state law, insofar as such losses, claims,
damages, or liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each case to the extent (and only to the extent) that such Violation occurs in reliance upon
and in conformity with written information furnished by such holder expressly for use in connection with such registration; and each such holder will reimburse any legal or other expenses reasonably
incurred by any person intended to be indemnified pursuant to this subsection 2.10(b), in connection with investigating or defending any such loss, claim, damage, liability, or action if it is
judicially determined that there was such a violation; provided,  

11

 

 however,that the indemnity agreement contained in this subsection 2.10(b) shall not apply to amounts paid in settlement of any such loss, claim, damage, liability or action if
such settlement is effected without the consent of the holder, which consent shall not be unreasonably withheld; provided, that in no event shall any indemnity under this subsection 2.10(b) exceed the
net proceeds from the offering received by such holder, except in the case of willful fraud by such holder. 

        (c)   Promptly after receipt by an indemnified party under this Section 2.10 of notice of the commencement of any action
(including any governmental action), such indemnified party will, if a claim in respect thereof is to be made against any indemnifying party under this Section 2.10, deliver to the indemnifying
party a written notice of the commencement thereof and the indemnifying party shall have the right to participate in, and, to the extent the indemnifying party so desires, jointly with any other
indemnifying party similarly noticed, to assume the defense thereof with counsel mutually satisfactory to the parties; provided, however, that an
indemnified party (together with all other indemnified parties which may be represented without conflict by one counsel) shall have the right to retain one separate counsel, with the reasonable fees
and expenses to be paid by the indemnifying party, if representation of such indemnified party by the counsel retained by the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party represented by such counsel in such proceeding. The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if materially prejudicial to its ability to defend such action, shall relieve such indemnifying party of any liability to the indemnified party
under this Section 2.10, but the omission so to deliver written notice to the indemnifying party will not relieve it of any liability that it may have to any indemnified party otherwise than
under this Section 2.10. 

        (d)   If the indemnification provided for in this Section 2.10 is held by a court of competent jurisdiction to be
unavailable to an indemnified party with respect to any loss, liability, claim, damage or expense referred to therein, then the indemnifying party, in lieu of indemnifying such indemnified party
hereunder, shall, to the extent permitted by applicable law, contribute to the amount paid or payable by such indemnified party as a result of such loss, liability, claim, damage, or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying party on the one hand and of the indemnified party on the other in connection with the statements or omissions that
resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable considerations; provided,
that in no event shall any contribution by a holder under this Subsection 2.10(d) exceed the net proceeds from the offering received by such holder, except in the case of willful fraud by such holder.
The relative fault of the indemnifying party and of the indemnified party shall be determined by a court of law by reference to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission to state a material fact relates to information supplied by the indemnifying party or by the indemnified party and the parties' relative intent, knowledge, access to
information, and opportunity to correct or prevent such statement or omission. 

        (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. 

12

  

        (f)    The obligations of the Company and the Preferred Holders under this Section 2.10 shall survive the completion of
any offering of Registrable Securities in a registration statement under this Section 2, and otherwise. 

        (g)   No indemnifying party, in the defense of any such claim or litigation, shall, except with the consent of each indemnified
party, consent to entry of any judgment or enter into any settlement which does not include as an unconditional term thereof the giving by the claimant or plaintiff to such indemnified party of a
release from all liability in respect of such claim or litigation. 

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

        (a)   make and keep public information available, as those terms are understood and defined in SEC Rule 144, at all
times after ninety (90) days after the effective date of the first registration statement filed by the Company for the offering of its securities to the general public so long as the Company
remains subject to the periodic reporting requirements under Sections 13 or 15(d) of the Exchange Act; 

        (b)   take such action, including the voluntary registration of its Common Stock under Section 12 of the Exchange Act,
as is necessary to enable the Preferred Holders to utilize Form S-3 for the sale of their Registrable Securities; 

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

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

        2.12    Assignment of Registration Rights.    The rights to cause the
Company to register Registrable Securities pursuant to this Section 2 may be assigned (but only with all related obligations) by a Preferred Holder to (i) a transferee or assignee of at
least 50,000 shares of such securities, (ii) a transferee or assignee of all of such Registrable Securities held by such transferring holder, if less than 50,000 shares, (iii) a general
partner, limited partner, retired partner, member or retired member, affiliate, parent or majority-owned subsidiary of the transferee or (iv) in the case of the Wellcome Trust Limited, any
successor trustee of the Wellcome Trust or additional trustee or trustees of the Wellcome Trust from time to time, or any company whose shares are all held directly or indirectly by the Wellcome
Trust, or any nominee or custodian of any such person; provided the Company is, within a reasonable time after such transfer, furnished with written notice of the name and address of such transferee
or assignee and the securities with respect to which such registration rights are being assigned; and provided, further, that such assignment shall be effective only if immediately following such
transfer the further disposition of such securities by the transferee or assignee is restricted under the Securities Act. For the purposes of determining the number of shares of Registrable Securities
held by a transferee or assignee, the 

13

 

holdings
of transferees and assignees of a partnership who are partners or retired partners of such partnership (including spouses and ancestors, lineal descendants and siblings of such partners or
spouses who acquire Registrable Securities by gift, will or intestate succession) shall be aggregated together and with the partnership; provided that all assignees and transferees who would not
qualify individually for assignment of registration rights shall have a single attorney-in-fact for the purpose of exercising any rights, receiving notices or taking any action
under Section 2. 

        2.13    Limitations on Subsequent Registration Rights.    From and
after the Effective Date, the Company shall not, without the prior written consent of the holders of 662/3% of the then outstanding Registrable Securities, enter into any agreement with
any holder or prospective holder of any securities of the Company which would allow such holder or prospective holder to include such securities in any registration filed under Section 2.2
hereof, unless under the terms of such agreement, such holder or prospective holder may include such securities in any such registration only to the extent that the inclusion of his securities will
not reduce the amount of the Registrable Securities of the Preferred Holders which are included. 

        2.14    "Market Stand-Off" Agreement.    Each holder of
Registrable Securities hereby agrees that, during the period of duration (up to, but not exceeding, 180 days) specified by the Company and an underwriter of Common Stock or other securities of
the Company, following the effective date of a registration statement of the Company filed under the Securities Act, it shall not, to the extent requested by the Company and such underwriter, directly
or indirectly sell, offer to sell, contract to sell (including, without limitation, any short sale), grant any option to purchase or otherwise transfer or dispose of (other than to donees who agree to
be similarly bound) any securities of the Company held
by it at any time during such period except Common Stock included in such registration; provided, however, that: 

        (a)   such agreement shall be applicable only to the first such registration statement of the Company which covers Common Stock
(or other securities) to be sold on its behalf to the public in an underwritten offering; and 

        (b)   all officers, directors, and key employees of the Company, all five-percent security holders, and all other
persons with registration rights (whether or not pursuant to this Agreement) enter into similar agreements. 

        In
order to enforce the foregoing covenant, the Company may impose stop-transfer instructions with respect to the Registrable Securities of each holder (and the shares or
securities of every other person subject to the foregoing restriction) until the end of such period, and each holder agrees that, if so requested, such holder will execute an agreement in the form
provided by the underwriter containing terms which are essentially consistent with the provisions of this Section 2.14. 

        Notwithstanding
the foregoing, the obligations described in this Section 2.14 shall not apply to a registration relating solely to employee benefit plans on
Form S-1 or Form S-8 promulgated under the Securities Act or similar forms which may be promulgated in the future, or a registration relating solely to an SEC
Rule 145 transaction on Form S-4 promulgated under the Securities Act or similar forms which may be promulgated in the future. 

        2.15    Termination of Registration Rights.    No holder of
Registrable Securities shall be entitled to exercise any right provided for in this Section 2 after six (6) years following the consummation of a Qualified IPO. 

        3.    EXCHANGE RIGHT.    

        3.1    General.    The holders of a majority of Series A
Preferred Stock (or Common Stock into which the shares of Series A Preferred Stock have been converted, collectively, the "Exchange Stock") shall
have the right to exchange the Exchange Stock held by them for shares of Common Stock ("SICOR Common Stock") of SICOR in accordance with this
Section 3 (the "Exchange  

14

 

 Right"). For purposes of this Section 3 only, "Registrable Securities" means 851,939 shares of Common Stock issuable on
conversion of the shares of the Company's Series A Preferred Stock issued to Sankyo pursuant to the Stock Purchase Agreement, dated December 18, 1997, by and among Sankyo, SICOR and the
Company. 

        3.2    Notice of Exercise.    The holders of a majority of the
Exchange Stock shall have the right upon forwarding a written notice (an "Exercise Notice") to SICOR and the Company within thirty (30) days
after January 10, 2001, and each one year anniversary thereafter until and including January 10, 2005 to elect to exchange up to twenty percent (20%) of the Exchange Stock held by the
Series A Holders for shares of SICOR Common Stock ("SICOR Shares"). Each Exercise Notice shall state that it constitutes an election hereunder
and shall specify the number of Exchange Stock to be exchanged for SICOR Shares. Upon receiving any Exercise Notice, SICOR shall cause the shares of Exchange Stock specified therein to be exchanged
promptly for SICOR Shares as provided in this Section 3. An election to exchange Exchange Stock hereunder shall be irrevocable. The failure by the Series A Holders to elect to convert
Exchange Stock during any exercise period specified above shall not limit in any respect their right to exercise such right any subsequent exercise period. For the avoidance of doubt, SICOR hereby
expressly acknowledges and agrees that no corporate transaction or other event relating to the Company, including, without limitation, its bankruptcy, insolvency or merger with or into another entity
shall limit, expand or accelerate in any respect the rights of the Series A Holders hereunder. 

        3.3    SICOR Exchange Shares.    The number of SICOR Shares which a
Series A Holder shall be entitled to receive upon exercise of the Exchange Right (the "SICOR Exchange Shares") shall be determined pursuant to
the following formula: 

	A	 	x	 	B	 	=	 	D	 	 
	 	 	 	 	C	 	 	 	 	 	 

        Where
  

	D	 	=	 	Number of SICOR Exchange Shares;
	

A	
 	

=	
 	

Number of shares of Registrable Securities held by such Series A Holder (or deemed to be held from conversion of such holder's Series A Preferred Stock) as of the date of mailing the most recent Exercise Notice ("Exercise Date") and specified in the
Exercise Notice.
	

B	
 	

=	
 	

Initially, $7.09 (the original issue price of Series A Preferred Stock), as proportionally adjusted for any stock splits, stock combinations, stock dividends, reclassifications, recapitalizations and the like (collectively referred to as a
"Recapitalization"); and
	

C	
 	

=	
 	

The arithmetic average of the closing price for SICOR Common Stock as quoted on the Nasdaq National Market ("Nasdaq") for the twenty (20) consecutive days on which SICOR Common Stock was traded on Nasdaq ending immediately before the Exercise Date
(the "SICOR Market Price").

        3.4    Adjustment for Recapitalization.    If at any time during the
period from the Effective Date to the most recent Exercise Date, the SICOR Common Stock is changed into the same or a different number of shares of any class or classes of stock, by any form of
Recapitalization other than (i) a subdivision or combination of shares or stock dividend, for which no adjustment pursuant to this Section 3.4 shall be made and (ii) a merger,
acquisition (whether of SICOR or another entity) or sale of substantially all of SICOR's assets (collectively referred to as a "Reorganization"), for
which adjustment shall be made pursuant to Section 3.5, each Series A Holder shall have the right to receive upon exercise of the Exchange Right the kind and amount of stock and other
securities and property receivable upon such Recapitalization by holders of the 

15

 

maximum
number of SICOR Common Shares into which Exchange Stock held by such Series A Holder could have been exchanged immediately prior to such Recapitalization (assuming for purposes of this
Section 3.4 that the Exchange Right was exercisable, and such exchange was completed, immediately prior to the closing of such Recapitalization), subject to further adjustment as provided with
respect to such other securities or property pursuant the terms thereof. 

        3.5    Adjustment for Reorganization.    If at any time during the
period from the Effective Date to the most recent Exercise Date, SICOR effects a Reorganization, provision shall be made so that each Series A Holder shall have the right to receive upon
exercise of the Exchange Right the kind and amount of stock and other securities and property receivable upon such Reorganization by holders of the maximum number of SICOR Common Shares into which
Exchange Stock could have been exchanged
immediately prior to such Reorganization (assuming for purposes of this Section 3.5 that the Exchange Right was exercisable, and such exchange was completed, immediately prior to the closing of
such Reorganization), subject to further adjustment as provided with respect to such other securities or property pursuant to the terms thereof. 

        3.6    Certificate of Adjustment.    Within 15 days following
the completion of a Recapitalization or Reorganization, SICOR, at its expense, shall compute the adjustment required in connection therewith pursuant to Section 3.4 or Section 3.5, as
applicable, and shall deliver to each Series A Holder a certificate showing such adjustment. The certificate shall set forth in reasonable detail SICOR's calculation of the adjustment and the
type and amount of other property which would be received by the Series A Holders upon exchange of their Exchange Stock pursuant to this Section 3. 

        3.7    Exchange Mechanics.    Series A Holders shall deliver
the certificate(s) representing the Exchange Stock such Series A Holders desire to exchange pursuant to this Section 3 to SICOR, and a copy of such certificate(s) to the Company,
together with the Exercise Notice. Upon receipt of the Exercise Notice and such certificates, SICOR shall calculate the number of SICOR Exchange Shares receivable by each such Series A Holder
pursuant to Section 3.3 and, within ten (10) business days of SICOR's receipt of the Exercise Notice, deliver to each such holder (i) certificates representing such
Series A Holder's SICOR Exchange Shares issued as of the applicable Exercise Date, (ii) a reasonably detailed statement indicating such calculation pursuant to Section 3.3 (which
calculation shall be binding upon such Series A Holder in the absence of manifest mathematical error or misstatement of the closing prices for the SICOR Common Stock for purposes of calculation
of the SICOR Market Price) and (iii) any cash payable in respect of fractional SICOR Exchange Shares pursuant to Section 3.9. Within ten (10) business days of SICOR's receipt of
the Exercise Notice, SICOR shall deliver a written notice to the Company (and a copy of such notice to the Series A Holders) stating the balance of shares of Exchange Stock, if any, surrendered
to SICOR under this Section 3.7 that remain unexercised pursuant to this Section 3, and within ten (10) business days of the Company's receipt of such notice, the Company shall
deliver to the Series A Holder a share certificate(s) for such balance. 

        3.8    SICOR Obligations in Respect of SICOR Exchange Shares.    SICOR
at all times shall reserve and keep available, solely for issuance and delivery upon exercise of each Series A Holder's Exchange Right, such number of SICOR Exchange Shares as may be issuable
upon such exchange. SICOR, at its expense, shall further cause a registration statement on Form S-3 registering the resale of the SICOR Exchange Shares to be filed and declared
effective in accordance with applicable law as soon as practicable following SICOR's receipt of any Exercise Notice. 

        3.9    Fractional Shares.    No fractional SICOR Exchange Shares shall
be issued upon exchange of Exchange Stock. All SICOR Exchange Shares (including fractions thereof) issuable upon exchange of Exchange Stock shall be aggregated for purposes of determining whether the 

16

 

exchange
would result in the issuance of any fractional share. If, after such aggregation, the exchange would result in any fractional share, SICOR shall, in lieu of issuing any fractional share, pay
cash equal to the product of such fraction multiplied by the SICOR Market Price. 

        3.10    Payment of Taxes.    SICOR will pay all taxes (other than
taxes based upon income) and other governmental charges that may be imposed with respect to the issue or delivery of SICOR Exchange Shares upon exchange of Exchange Stock. 

        4.    RIGHT OF FIRST OFFER.    

        4.1    General.    Except for (i) conversion rights applicable
to the Company's Preferred Stock, (ii) securities issued pursuant to an underwritten public offering pursuant to an effective registration statement under the Securities Act,
(iii) securities issued pursuant to the Company's acquisition of another corporation by merger, purchase of substantially all the assets or other corporate reorganization,
(iv) securities issued in connection with any stock split or stock dividend of the Company, (v) securities issued after the Effective Date to employees, officers, directors or
consultants of the Company pursuant to stock purchase or stock option plans, stock bonuses or awards, contracts or other arrangements that are approved by the Company's Board of Directors,
(vi) warrants or other securities issued to financial institutions or commercial lenders in connection with equipment financing transactions approved by the Company's Board of Directors and
(vii) securities issued in connection with strategic corporate partner agreements approved by the Company's Board of Directors, the Company will not, nor will it permit any of its subsidiaries
to, authorize or issue any shares of stock of the Company of any class and will not authorize, issue or grant any options, warrants, conversion rights or other rights to purchase or acquire any shares
of stock of the Company of any class without offering the holders of Series C, Series D and Series E Preferred Stock the right of first refusal described below. In the event the
Company grants subsequent purchasers any rights of first refusal or registration rights which are, in the good faith judgment of the Board of Directors, more favorable to such purchasers than those
granted to the Series C, Series D and Series E Holders pursuant to this Agreement, then the Series C, Series D and Series E Holders shall receive such rights. 

        4.2    Right of First Refusal.    

        (a)   Each holder of Series C, Series D and Series E Preferred Stock shall have a right of first refusal
to purchase an amount of equity securities of the Company of any class or kind which the Company proposes to sell (other than the issuance of shares contemplated by Section 4.1 above)
sufficient to maintain such holder's proportionate beneficial ownership interest in the Company. If the Company wishes to make any such sale of its securities, it shall give the Series C,
Series D and Series E Holders written notice of the proposed sale (the "Section 4.2 Notice"). The Section 4.2 Notice shall
set forth (i) the Company's bona fide intention to offer such shares and (ii) the material terms and conditions of the proposed sale (including the number of shares to be offered and the
price, if any, for which the Company proposes to offer such shares), and shall constitute an offer to sell such securities to Series C, Series D and Series E Holders on such terms
and conditions. Any Series C, Series D or Series E Holder may accept such offer by delivering a written notice of acceptance to the Company within ten (10) days after
receipt of the Section 4.2 Notice. Any Series C, Series D or Series E Holder exercising its right of first refusal shall be entitled to participate in the purchase of such
securities on a pro rata basis to the extent necessary to maintain such holder's proportionate beneficial ownership interest in the Company (for purposes of determining the pro rata interest of the
Series C, Series D and Series E Holders, any Series C, Series D or Series E Holder shall be treated as owning that number of shares of Common Stock into which
any outstanding convertible preferred stock and warrants to purchase convertible preferred stock held by them may be converted, and the Company shall be treated as having outstanding, immediately
prior to the proposed sale of equity security, all outstanding Common Stock, all outstanding options to purchase shares of Common Stock pursuant to the 

17

 

Amended
and Restated 2001 Equity Incentive Plan of Metabasis Therapeutics, Inc., and that amount of Common Stock into which all outstanding shares of convertible preferred stock, including all
outstanding rights to acquire or otherwise purchase such convertible preferred stock, may be converted). The Company shall promptly, in writing, inform each Series C, Series D and
Series E Holder which elects to purchase its pro rata portion of such shares of any other holder's failure to do so, in which case the holders electing to purchase such shares shall have the
right to purchase all or a portion of such shares on a pro rata basis, on terms no less favorable to the holder, for a period of ten (10) days. Such Series C, Series D and/or
Series E Holder shall be entitled to apportion the right of first refusal hereby granted among itself and its partners, affiliates and related parties in such proportions it deems appropriate.
If the Series C, Series D and/or Series E Holders do not accept such offer within ten (10) days, then that portion of the shares which is not purchased may be offered to
other parties on terms no less favorable to the Company for a period of ten (10) days. 

        (b)   In lieu of delivering the Section 4.2 Notice to the Series C, Series D and Series E Holders
prior to the sale of Company offered securities to third parties, as provided in subsection 4.2(a), above the Company may elect first to sell Company offered securities to third parties and then,
within thirty (30) days thereafter, offer such Series C, Series D and Series E Holders the opportunity to purchase their pro rata portions of the Company offered
securities. Such offer shall remain in effect for twenty (20) days after notice to the Series C, Series D and Series E Holders and, if accepted, the closing of the sale of
Company offered securities shall occur within thirty (30) days after the date of the acceptance notice. 

        4.3    Expiration of Right of First Refusal.    The right of first
refusal granted under this Section 4 shall expire upon the consummation of a Qualified IPO. 

        4.4    Assignment.    The right of first refusal granted under this
Section 4 may be assigned (i) to a transferee or assignee in connection with any transfer or assignment by a Series C, Series D or Series E Holder of not less than
50,000 shares of Registrable Securities, or such lesser number if such shares constitute all of the Registrable Securities then held by such Series C, Series D or Series E Holder,
(ii) to any transferee or assignee who is a constituent, member or partner or retired partner of a Series C, Series D or Series E Holder or the estate of such partner, or
to any transferee or assignee who is a family member of the Series C, Series D or Series E Holder or a trust for the benefit of the Series C, Series D or
Series E Holder or any family member of the Series C, Series D or Series E Holder or any parent corporation or subsidiary corporation of the Series C,
Series D or Series E Holder or (iii) in the case of the Wellcome Trust Limited, to any successor trustee of the Wellcome Trust or additional trustee or trustees of the Wellcome
Trust from time to time, or any company whose shares are all held directly or indirectly by the Wellcome Trust, or any nominee or custodian of any such person; provided that, with respect to each such
transfer or assignment, the Company be given prior written notice of the transfer, the transferee or assignee agree writing to all provisions contained in this Section 4 and that such transfer
otherwise be effected in accordance with applicable laws. 

        5.    MISCELLANEOUS.    

        5.1    Board Observer Rights.    The Series A Holders shall
have the right to designate a representative to attend meetings of the Company's Board of Directors in a nonvoting capacity and to receive prior written notice of, and copies of all materials
distributed at, all such meetings (regardless of whether such representative attends such meetings); provided, however, that the Company shall not be
obligated under this Section 5.1 to provide information, or include such observer in discussions relating to information, which the Company determines in good faith (i) to involve an
ongoing commercial relationship, or a proposed transaction, between the Company and a third party, or (ii) to be a trade secret or to be subject to the attorney-client privilege. This
Section 5.1 shall terminate upon the consummation of a Qualified IPO. 

18

 

        5.2    Real Property Holding Corporation.    The Company covenants
that it will operate in such a manner that it will not become a "United States real property holding corporation" ("USRPHC") as that term is defined in
Section 897(c)(2) of the Internal Revenue Code of 1986, as amended, and the regulation thereunder. The Company agrees to make determinations as to its status as a USRPHC, and will file
statements concerning those determinations with the Internal Revenue Service, in the manner and at the times required under Reg. §1.8972(h), or any supplementary or successor provision
thereto. Within 30 days of a request from a Series A Holder, Series B Holder, Series C Holder, Series D Holder or Series E Holder, the Company will inform the
requesting party, in the manner set forth in Reg. §1.8972(h)(1)(iv) or any supplementary or successor provision thereto, whether that party's interest in the Company constitutes a
United States real property interest (within the meaning of Internal Revenue Code Section 897(c)(1) and the regulations thereunder) and whether the Company has provided to the Internal Revenue
Service all required notices as to its USRPHC status. This Section 5.2 shall terminate upon the consummation of a Qualified IPO. 

        5.3    Waivers and Amendments.    With the written consent of the
Company and the holders of more than 662/3% of the Registrable Securities the obligations of the Company and the rights of the holders of Registrable Securities under this Agreement may
be waived (either generally or in a particular instance, either retroactively or prospectively and either for a specified period of time or indefinitely), and with the same consent, the Company, when
authorized by resolution of its Board of Directors, may amend this Agreement or enter into a supplementary agreement for the purpose of adding any provisions of this Agreement. Neither this Agreement
nor any provisions hereof may be amended, changed, waived, discharged or terminated orally, but only by a signed statement in writing evidencing the consents required pursuant to the preceding
sentence. Any amendment, waiver or supplementary agreement effected in accordance with this paragraph shall be binding upon each holder of any Registrable Securities then outstanding, each future
holder of all such Registrable Securities and the Company. Notwithstanding the foregoing, (i) the written consent of a majority of the holders of Series C, Series D and
Series E Preferred Stock, voting together on an as-if-converted basis, shall be obtained prior to any amendment or waiver of the rights, preferences or privileges of the
holders of Series C, Series D or Series E Preferred Stock contained in Sections 1 and 4 of this Agreement and this Section 5.3 and (ii) the written consent of 67% of
the holders of the Series A Preferred Stock and Series B Preferred Stock shall be obtained prior to any amendment or waiver of the rights, preferences or privileges of the holders of the
Series A Preferred Stock and the Series B Preferred Stock, as the case may be, contained in Sections 1 and 3 of this Agreement and this Section 5.3. By executing this Agreement,
the holders of Series C and Series D Preferred Stock hereby agree and acknowledge that the right of first refusal set forth in Section 4 of the Prior Agreement shall not apply to,
and is hereby waived with respect to, the shares of Series E Preferred Stock issued pursuant to the Purchase Agreement. 

        5.4    Delays or Omissions.    It is agreed that no delay or omission
to exercise any right, power, or remedy accruing to any Series A Holder, Series B Holder, Series C Holder, Series D Holder or Series E Holder, upon any breach,
default, or noncompliance of the Company under this Agreement shall impair any such right, power, or remedy, nor shall it be construed to be a waiver of any such breach, default, or noncompliance, or
any acquiescence therein, or of any similar breach, default, or noncompliance thereafter occurring. It is further agreed that any waiver, permit, consent, or approval of any kind or character on any
such holder's part of any breach, default, or noncompliance under the Agreement or any waiver on such holder's part of any provisions or conditions of this Agreement must be in writing and shall be
effective only to the extent specifically set forth in such writing. All remedies, either under this Agreement, by law, or otherwise afforded to the Series A Holders, Series B Holders,
Series C Holders, Series D Holders or Series E Holders, shall be cumulative and not alternative. 

19

 

        5.5    Notices.    All notices and other communications required or
permitted hereunder shall be in writing and, except as otherwise noted herein, shall be deemed effectively given (i) upon personal delivery, (ii) in the case of notices being delivered
to the Company, SICOR or any other Investor except for Sankyo by any party except for Sankyo, delivery by a nationally recognized courier or upon deposit with the United States Post Office (by first
class mail, postage prepaid) and (iii) in the case of notices being delivered to or by Sankyo, delivery by an internationally recognized courier service. All communications shall be sent to the
party to be notified at the following addresses or at such other address as such party may designate by ten (10) days advance written notice to the other parties: a) if to the Company,
at 9390 Towne Centre Drive, San Diego, California 92121, attention of the Chief Executive Officer, (b) if to SICOR, at 19 Hughes Street, Irvine, CA 92121, Attention: John Sayward, (c) if
to Sankyo, at
Hiromachi 1258, Shinagawaku, Tokyo, 1408710 Japan, Attention: Dr. Yoshiki Matsui, Research Planning Department, or (d) if to any other Investor, at its respective address listed on the
signature page hereof; provided, however, that, if any such notice is to be delivered by the Company to a holder of Registrable Securities, the Company
may deliver such notice to the latest address of such person shown on the Company's records. 

        5.6    Descriptive Headings.    The descriptive headings herein have
been inserted for convenience only and shall not be deemed to limit or otherwise affect the construction of any provisions hereof. 

        5.7    Governing Law.    This Agreement shall be governed by and
interpreted under the laws of the State of California as applied to agreements among California residents, made and to be performed entirely within the State of California. 

        5.8    Counterparts.    This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original and all of which shall constitute the same instrument, but only one of which need be produced. 

        5.9    Expenses.    If any action at law or in equity is necessary to
enforce or interpret the terms of this Agreement, the prevailing party shall be entitled to reasonable attorney's fees, costs and necessary disbursements in addition to any other relief to which such
party may be entitled. 

        5.10    Successors and Assigns.    Except as otherwise expressly
provided in this Agreement, this Agreement shall benefit and bind the successors, assigns, heirs, executors and administrators of the parties to this Agreement. 

        5.11    Entire Agreement.    This Agreement constitutes the full and
entire understanding and agreement between the parties with regard to the subject matter of this Agreement. 

        5.12    Separability; Severability.    Unless expressly provided in
this Agreement, the rights of each Investor under this Agreement are several rights, not rights jointly held with any other Investors. Any invalidity, illegality or limitation on the enforceability of
this Agreement with respect to any Investor shall not affect the validity, legality or enforceability of this Agreement with respect to the other Investors. If any provision of this Agreement is
judicially determined to be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not be affected or impaired unless the severed provision is
material to the rights and benefits received by any party hereto. In such event the parties hereto shall use reasonable commercial efforts to negotiate, in good faith, a substitute, valid and
enforceable provision or agreement which most nearly effects the intent of the parties entering into this Agreement. 

        5.13    Stock Splits.    All references to numbers of shares in this
Agreement shall be appropriately adjusted to reflect any stock dividend, split, combination or other recapitalization of shares by the Company occurring after the Effective Date. 

20

 

        5.14    Tax Matters.    Notwithstanding anything herein to the
contrary, any party to this Agreement (and any employee, representative, or other agent of any party to this Agreement) may disclose to any and all persons, without limitation of any kind, the tax
treatment and tax structure of the transactions contemplated by this Agreement and all materials of any kind (including opinions or other tax analyses) that are provided to it relating to such tax
treatment and tax structure; provided however, that such disclosure may not be made to the extent reasonably necessary to comply with any applicable federal or state securities laws. For the purposes
of the foregoing sentence, (i) the "tax treatment" of a transaction means the purported or claimed federal income tax treatment of the transaction and (ii) the "tax structure" of a
transaction means any fact that may be relevant to understanding the purported or claimed federal income tax treatment of the transaction. Thus, for the avoidance of doubt, the parties acknowledge and
agree that the tax treatment and tax structure of any transaction does not include the name of any party to a transaction or any sensitive business information (including, without limitation, the name
and other specific information about any party's intellectual property or other proprietary assets) unless such information may be related or relevant to the purported or claimed federal income tax
treatment of the transaction. 

        5.15    Signatory Capacity.    With respect to its signatory capacity
and liability as the trustee of the Wellcome Trust, the Wellcome Trust Limited (the "Trustee") enters into this Agreement in its capacity as the trustee
for the time being of the Wellcome Trust but not otherwise and it is hereby agreed and declared that notwithstanding anything to the contrary contained or implied in this Agreement: 

        (a)   the obligations incurred by the Trustee under or in consequence of this Agreement shall be enforceable against it or the
other trustees of the Wellcome Trust from time to time; and 

        (b)   the liabilities of the Trustee (or such other trustees as are referred to in paragraph (a) above) in respect of
such obligations shall be limited to such liabilities as can, and may lawfully and properly be met out of the assets of the Wellcome Trust for the time being in the hands or under the control of the
Trustee or such other trustees. 

[THIS SPACE INTENTIONALLY LEFT BLANK]  

21

        IN WITNESS WHEREOF, the parties have executed this Amended and Restated Investors' Rights Agreement on the day and year first set forth
above. 

	 	 	COMPANY:
	

 	
 	
METABASIS THERAPEUTICS, INC.
	

 	
 	
By:	
 	

/s/  PAUL K. LAIKIND      
 Paul K. Laikind, Chief Executive Officer

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	SICOR:
	

 	
 	
SICOR INC.
	

 	
 	
By:	
 	

/s/ WESLEY N. FACH

	

 	
 	

Name:	
 	

Wesley N. Fach

	

 	
 	

Title:	
 	

Senior Vice President, General
Counsel & Secretary

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	SANKYO:
	

 	
 	
SANKYO COMPANY, LTD.
	

 	
 	
By:	
 	

/s/  MOSATU KONDA      

	

 	
 	

Name:	
 	

Mosatu Konda

	

 	
 	

Title:	
 	

Director, Finance Department

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
MPM BIOVENTURES II, L.P.
	

 	
 	
By:	
 	

MPM Asset Management II, L.P.,

its General Partner
	

 	
 	

By:	
 	

MPM Asset Management II LLC,

its General Partner
	

 	
 	

By:	
 	

/s/ LUKE B. EVNIN

	

 	
 	

Name:	
 	

Luke B. Evnin

	

 	
 	

Title:	
 	

Manager

	

 	
 	
MPM BIOVENTURES II-QP, L.P.
	

 	
 	
By:	
 	

MPM Asset Management II, L.P.,

its General Partner
	

 	
 	

By:	
 	

MPM Asset Management II LLC,

its General Partner
	

 	
 	

By:	
 	

/s/ LUKE B. EVNIN

	

 	
 	

Name:	
 	

Luke B. Evnin

	

 	
 	

Title:	
 	

Manager

	

 	
 	
MPM BIOVENTURES GMBH & CO.

PARALLEL-BETEILIGUNGS KG
	

 	
 	
By:	
 	

MPM Asset Management II, L.P.,

in its capacity as the Special Limited Partner
	

 	
 	

By:	
 	

MPM Asset Management II LLC,

its General Partner
	

 	
 	

By:	
 	

/s/ LUKE B. EVNIN

	

 	
 	

Name:	
 	

Luke B. Evnin

	

 	
 	

Title:	
 	

Manager

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
MPM ASSET MANAGEMENT INVESTORS

2000 B LLC
	

 	
 	
By:	
 	

/s/ LUKE B. EVNIN

	

 	
 	

Name:	
 	

Luke B. Evnin

	

 	
 	

Title:	
 	

Manager

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
INTERWEST PARTNERS VII, L.P.
	

 	
 	
By:	
 	

/s/ W. STEPHEN HOLMES

	

 	
 	

Name:	
 	

W. Stephen Holmes

	

 	
 	

Title:	
 	

Managing Director

	

 	
 	
INTERWEST INVESTORS VII, L.P.
	

 	
 	
By:	
 	

/s/ W. STEPHEN HOLMES

	

 	
 	

Name:	
 	

W. Stephen Holmes

	

 	
 	

Title:	
 	

Managing Director

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
GC&H INVESTMENTS
	

 	
 	
By:	
 	

/s/ KENNETH L. GUERNSEY

	

 	
 	

Name:	
 	

Kenneth L. Guernsey

	

 	
 	

Title:	
 	

Executive Partner

	

 	
 	
GC&H INVESTMENTS, LLC
	

 	
 	
By:	
 	

/s/ KENNETH L. GUERNSEY

	

 	
 	

Name:	
 	

Kenneth L. Guernsey

	

 	
 	

Title:	
 	

Managing Member

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
DAVID F. HALE AND LINDA C. HALE

AS TRUSTEES UDT DATED FEBRUARY 28, 1986
	
 	
 	

 	
 	

/s/ DAVID F. HALE

	

 	
 	

By:	
 	

David F. Hale, Trustee

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
DLJ CAPITAL CORP.
	

 	
 	
/s/ KATHLEEN LAPORTE

	 	 	By:	 	Kathleen LaPorte
	 	 	Its:	 	Managing Director
	

 	
 	
SPROUT ENTREPRENEURS FUND, L.P.
	

 	
 	
By:	
 	

DLJ Capital Corp.
	 	 	Its:	 	General Partner
	

 	
 	

/s/ KATHLEEN LAPORTE

	 	 	By:	 	Kathleen LaPorte
	 	 	Its:	 	Managing Director
	

 	
 	
SPROUT CAPITAL IX, L.P.
	

 	
 	
By:	
 	

DLJ Capital Corp.
	 	 	Its:	 	Managing General Partner
	

 	
 	

/s/ KATHLEEN LAPORTE

	 	 	By:	 	Kathleen LaPorte
	 	 	Its:	 	Managing Director
	

 	
 	
SPROUT IX PLAN INVESTORS, L.P.
	

 	
 	
By:	
 	

DLJ LBO Plans Management Corporation II
	 	 	Its:	 	General Partner
	

 	
 	

/s/ KATHLEEN LAPORTE

	 	 	By:	 	Kathleen LaPorte
	 	 	Its:	 	Attorney in fact

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
 HEINZ W. GSCHWEND & CYNTHIA T. HEALY, TRUSTEES OF THE H.W. GSCHWEND & C.T. HEALY REVOCABLE TRUST
	

 	
 	

 	
 	
/s/ HEINZ W. GSCHWEND

	 	 	By:	 	Heinz W. Gschwend, Trustee

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
LB I GROUP INC.
	

 	
 	
By:	
 	

/s/ JOHN CHAMBERS

	

 	
 	

Name:	
 	

John Chambers

	

 	
 	

Title:	
 	

Managing Director

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
WELLCOME TRUST LIMITED, AS TRUSTEE OF THE WELLCOME TRUST
	

 	
 	

 	
 	
/s/ GARY STEINBERG

	 	 	By:	 	Gary Steinberg

Chief Investment Officer

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
ITOCHU CORPORATION
	

 	
 	

 	
 	
/s/ EIZO KOBAYASHI

	 	 	By:	 	Eizo Kobayashi

Managing Director

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
MAVERICK FUND, L.D.C.
	

 	
 	
By:	
 	

Maverick Capital, Ltd.
	 	 	Its:	 	Investment Advisor
	

 	
 	

By:	
 	

/s/ SHARYL ROBERTSON

	

 	
 	

Name:	
 	

Sharyl Robertson

	

 	
 	

Title:	
 	

CFO

	

 	
 	
MAVERICK FUND USA, LTD.
	

 	
 	
By:	
 	

Maverick Capital, Ltd.
	 	 	Its:	 	Investment Advisor
	

 	
 	

By:	
 	

/s/ SHARYL ROBERTSON

	

 	
 	

Name:	
 	

Sharyl Robertson

	

 	
 	

Title:	
 	

CFO

	

 	
 	
MAVERICK FUND II, LTD.
	

 	
 	
By:	
 	

Maverick Capital, Ltd.
	 	 	Its:	 	Investment Advisor
	

 	
 	

By:	
 	

/s/ SHARYL ROBERTSON

	

 	
 	

Name:	
 	

Sharyl Robertson

	

 	
 	

Title:	
 	

CFO

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

	 	 	INVESTORS:
	

 	
 	
PAN-PACIFIC VENTURE CAPITAL CO., LTD.
	

 	
 	
By:	
 	

/s/ DAVID Y. S. CHAO

	

 	
 	

Name:	
 	

David Y. S. Chao

	

 	
 	

Title:	
 	

President

[SIGNATURE PAGE TO

AMENDED AND RESTATED INVSTORS' RIGHTS AGREEMENT] 

Exhibit A

INVESTORS  

SERIES A PREFERRED STOCK:  

Sankyo
Company, Ltd.

SICOR Inc. 

SERIES B PREFERRED STOCK:  

Sankyo
Company, Ltd. 

SERIES C PREFERRED STOCK:  

MPM
Bioventures II, L.P.

MPM Bioventures II-QP, L.P.

MPM Bioventures GmbH & Co. Parallel-Beteiligungs KG

MPM Asset Management Investors 2000 B LLC

InterWest Partners VII, L.P.

InterWest Investors VII, L.P.

GC&H Investments 

SERIES D PREFERRED STOCK:  

MPM
Bioventures II, L.P.

MPM Bioventures II-QP, L.P.

MPM Bioventures GmbH & Co. Parallel-Beteiligungs KG

MPM Asset Management Investors 2000 B LLC

InterWest Partners VII, L.P.

InterWest Investors VII, L.P.

GC&H Investments, LLC

David F. Hale and Linda C. Hale as Trustees UDT Dated February 28, 1986

DLJ Capital Corp.

Sprout IX Plan Investors, L.P.

Sprout Entrepreneurs Fund, L.P.

Sprout Capital IX, L.P. 

SERIES E PREFERRED STOCK:  

MPM
Bioventures II, L.P.

MPM Bioventures II-QP, L.P.

MPM Bioventures GmbH & Co. Parallel-Beteiligungs KG

MPM Asset Management Investors 2000 B LLC

InterWest Partners VII, L.P.

InterWest Investors VII, L.P.

DLJ Capital Corp.

Sprout IX Plan Investors, L.P.

Sprout Entrepreneurs Fund, L.P.

Sprout Capital IX, L.P.

Heinz W. Gschwend & Cynthia T. Healy, Trustees of the H.W. Gschwend & C.T. Healy Revocable Trust

LB I Group Inc.

Wellcome Trust Limited, as Trustee of the Wellcome Trust

ITOCHU Corporation

Maverick Fund, L.D.C.

Maverick Fund USA, Ltd.

Maverick Fund II, Ltd.

Pan-Pacific Venture Capital Co., Ltd. 

QuickLinks

Exhibit 4.11

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