Document:

exv4w1

Exhibit 4.1

	COMMON
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE SEE REVERSE SIDE FOR CERTAIN DEFINITIONS CUSIP
317485 10 0
THIS CERTIFIES THAT
is the owner of
FULLY PAID AND NON-ASSESSABLE COMMON SHARES, $0.0001 PAR VALUE, OF
FINANCIAL ENGINES, INC.
transferable on the books of the Corporation by the holder hereof in person or by Attorney upon
surrender of this certificate properly endorsed. This certificate is not valid until countersigned
and registered by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the said Corporation has caused this certificate to be signed by facsimile
signatures of its duly authorized officers.
Dated:
PRESIDENT AND CHIEF EXECUTIVE OFFICER
COUNTERSIGNED AND REGISTERED:
WELLS FARGO BANK, N.A.
TRANSFER AGENT
AND REGISTRAR
BY
AUTHORIZED SIGNATURE
AMERICAN FINANCIAL PRINTING INCORPORATED – MINNEAPOLIS
THIS CERTIFICATE IS TRANSFERABLE
IN SOUTH SAINT PAUL, MN.
FINANCIAL ENGINES, INC.
DELAWARE ?
C O R P O R ATESEAL
MARCH 17,
2008
FNGN
CHIEF FINANCIAL OFFICER

 

 

	THE BOARD OF THIS CORPORATION HAS THE AUTHORITY TO CREATE AND DETERMINE THE RELATIVE RIGHTS AND
PREFERENCES OF CLASSES OR SERIES OF SHARES OF CAPITAL STOCK OTHER THAN COMMON STOCK.
THIS CORPORATION WILL FURNISH TO ANY SHAREHOLDER UPON WRITTEN REQUEST SENT TO ITS PRINCIPAL
EXECUTIVE OFFICES, AND WITHOUT CHARGE, A FULL STATEMENT OF THE BOARD’S AUTHORITY TO CREATE AND
DETERMINE THE RELATIVE RIGHTS AND PREFERENCES OF CLASSES OR SERIES OF SHARES OF CAPITAL STOCK AS
WELL AS THE DESIGNATIONS, PREFERENCES, LIMITATIONS AND RELATIVE RIGHTS OF THE SHARES OF EACH CLASS
OR SERIES THEN OUTSTANDING OR AUTHORIZED TO BE ISSUED.
The following abbreviations, when used in the inscription on the face of this certificate, shall be
construed as though they were written out in full according to applicable laws or regulations:
TEN COM – as tenants in common UTMA – ___Custodian ___
(Cust) (Minor)
TEN ENT – as tenants by entireties under Uniform Transfers to Minors
JT TEN – as joint tenants with right of survivorship Act ___
and not as tenants in common (State)
Additional abbreviations may also be used though not in above list.
For value received ___hereby sell, assign, and transfer unto
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING ZIP CODE OF ASSIGNEE)
Shares
of the capital stock represented by the within Certificate,
and do hereby irrevocably constitute and appoint
Attorney
to transfer the said stock on the books of the within-named
Corporation with full power of substitution in the premises.
Dated ___X
X
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE
OF THE CERTIFICATE IN EVERY PARTICULAR WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER.
SIGNATURE GUARANTEED
ALL GUARANTEES MUST BE MADE BY A FINANCIAL INSTITUTION (SUCH
AS A BANK OR BROKER) WHICH IS A PARTICIPANT IN THE SECURITIES
TRANSFER AGENTS MEDALLION PROGRAM (“STAMP”), THE NEW YORK
STOCK EXCHANGE, INC. MEDALLION SIGNATURE PROGRAM (“MSP”), OR
THE STOCK EXCHANGES MEDALLION PROGRAM (“SEMP”) AND MUST NOT
BE DATED. GUARANTEES BY A NOTARY PUBLIC ARE NOT ACCEPTABLE.
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEEexv4w2

Exhibit 4.2

REPLY! INC.

AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

     This Amended and Restated Investor Rights Agreement (the “Agreement”) is made as of March 19, 2007,
by and among Reply! Inc., a California corporation (the “Company”), the holders of the Company’s
Series A Preferred Stock, the holders of the Company’s Series B Preferred Stock each of whom shall
be listed on Exhibit A hereto, which shall be amended at each Closing (as defined in the
Purchase Agreement (as defined below)) (together the
“Investors”) and certain holders of the
Company’s common stock listed on Exhibit B hereto (the “Common Holders”).

RECITALS

     A. The Company, the Common Holders and certain of the Investors (the “Prior Investor ”) are
parties to an Investor Rights Agreement dated as of August 18, 2005 (the “Prior Agreement”),
which sets forth certain registration rights, rights of first offer and information rights
granted by the Company.

     B. The Company and certain of the Investors (the “Series B Investors”) have entered into
the Series B Preferred Stock Purchase Agreement of even date herewith (the “Purchase Agreement”).

     C. In order to induce the Series B Investors to enter into the Purchase Agreement and invest funds
in the Company pursuant thereto, the Company, the Common Holders and the Prior Investors desire to
enter into this Agreement with the Investors.

     Therefore, the Prior Agreement is hereby amended and restated in its entirety as set forth below, and the parties hereto further agree as follows:

1. Definitions. For purposes of this Agreement:

     1.1 “Board” means the Board of Directors of the Company, as the same shall be constituted
from time to time.

     1.2 “Common Stock” means the Common Stock of the Company.

     1.3 “Confidential Information” means information about the Company’s business or activities
that is proprietary and confidential, which shall include all business, financial, technical and
other information of the Company marked or designated by the Company as “confidential” or
“proprietary” or information which, by the nature of the circumstances surrounding the disclosure,
ought in good faith to be treated as confidential, including, without limitation, all information
disclosed to Holders via their designees on the Board. Confidential Information will not include
information that (a) is in or enters the public domain without breach of this Agreement, (b) the
Holder lawfully receives from a third party without restriction on disclosure and without breach of a nondisclosure
obligation, (c) the Holder knew prior to receiving such

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information from the Company or (d) the Holder independently develops without reliance on any Confidential Information.

     1.4 “Convertible Securities” means all securities of the Company convertible, with or
without consideration, into Common Stock,

     1.5 “Exchange Act” means the Securities Exchange Act of 1934, as amended.

     1.6 “Exempt Registration” means a registration statement relating to the sale of securities
by the Company pursuant to a stock option, stock purchase or similar benefit plan or an SEC Rule
145 transaction or any other registration statement that would not customarily provide for the sale
of secondary equity shares for cash.

     1.7 “Form S-3” means such form under the Securities Act as in effect on the date hereof or
any successor form under the Securities Act that is intended to be used as a short form for the
registration of securities.

     1.8 “Holder” means any person owning or having the right to acquire Registrable Securities
or any assignee thereof in accordance with Section 2.10 of this Agreement. For the
purposes of Sections 2.1, 2.3, 2.11 and 2.12, “Holder” shall mean only the Investors. For
the purposes of Section 2,2, “Holders” shall mean only the Investors, Payam Zamani, the Zamani
Family Trust, May One LLC and Victor Choy.

     1.9 “IPO” means the Company’s initial public offering of its securities pursuant to a
registration statement filed under the Securities Act.

     1.10 “Major Investor” means any Holder of at least 750,000 shares of the then outstanding
shares of Registrable Securities (as appropriately adjusted for any stock split, dividend,
combination, recapitalization or similar event) and, solely for the purposes of Section 3.3 of this
Agreement, Point Financial, Inc. (pursuant to Section 9(a) of that certain Warrant to Purchase
Shares of Preferred Stock dated February 14, 2006 issued to Point Financial, Inc.).

     1.11 “Outlook Director” means the Preferred Stock Director as defined under the Second
Amended and Restated Articles of Incorporation designated by Outlook Ventures, who shall initially
be Randy Haykin.

     1.12 “Person” means any individual, corporation, partnership, limited liability company,
trust, business, association or government or political subdivision thereof, governmental agency or
other entity.

     1.13 “Preferred Stock” means the Series A Preferred Stock and Series B Preferred Stock of
the Company.

     1.14 “Qualified IPO” means the firm commitment underwritten public offering by the Company
of shares of its Common Stock pursuant to a registration statement on Form S-1 (or any successor
form) under the Securities Act, the public offering price of which is not less than $9.85 per share
(appropriately adjusted for any stock split, dividend, combination,

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recapitalization or similar event) and which results in aggregate cash proceeds to the Company of at least $30,000,000 (net of
underwriting discounts, commissions and expenses).

     1.15 “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.

     1.16 “Registrable Securities” means (i) (a) the shares of Common Stock issuable or issued
upon conversion of the Preferred Stock, and (b) any other shares of Common Stock of the Company
issued (or issuable upon the conversion or exercise of any warrant, right or other security) as a
dividend or other distribution with respect to, or in exchange for or in replacement of, the shares
listed in clause (a), (ii) the shares of Common Stock held by the Common Holders; provided,
however, that the foregoing definition shall exclude in all cases any Registrable Securities
sold by a Holder in a transaction in which its rights under this Agreement are not assigned.
Notwithstanding the foregoing, securities shall only be treated as Registrable Securities if and so
long as they have not been (X) sold to or through a broker or dealer or underwriter in a public
distribution or a public securities transaction, or (Y) 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. For the purposes of the registration rights set forth
in Sections 2.1 and 2.3 hereof, “Registrable Securities” shall be deemed to exclude the shares of
Common Stock held by the Common Holders. For the purposes of the registration rights set forth in
Section 2.2 hereof, “Registrable Securities” shall be deemed to exclude all shares of Common Stock
held by the Common Holders other than shares held by Payam Zamani, 210,000 shares held by the
Zamani Family Trust, 100,000 shares held by Victor Choy and 125,000 shares held by May One LLC.
All amounts are to be adjusted for stock splits, recapitalizations, stock dividends and the like.

     1.17 “Registrable Securities then outstanding” means the number of shares of Common Stock
outstanding which are, and the number of shares of Common Stock issuable pursuant to then
exercisable or convertible securities which are, Registrable Securities.

     1.18 “Scale Director” means the Preferred Stock Director as defined under the Second
Amended and Restated Articles of Incorporation designated by Scale Venture Partners II, LP.

     1.19 “SEC” means the Securities and Exchange Commission or any other
federal agency at the time administering the Securities Act.

     1.20 “Securities Act” means the Securities Act of 1933, as amended.

2.Registration Rights.

     2.1 Request for Registration 

          (a) Initiation. Beginning three years after the date of this Agreement, or at any time
after six months after the effective date of a Qualified IPO, if the Company shall receive

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a written request from the Holders of at least thirty percent (30%) of the Registrable Securities
then outstanding (the “Initiating Holders”) that the Company file a registration statement
under the Securities Act covering the registration of at least seven million five hundred thousand
dollars ($7,500,000) of the Registrable Securities then outstanding, then the Company shall, within
10 days of the receipt thereof, give notice of such request to all other Holders and shall, subject
to the limitations of subsection 2.1(b), use all commercially reasonable efforts to effect as soon
as practicable the registration (including, without limitation, filing post-effective amendments,
appropriate qualifications under applicable blue sky or other state securities laws, and
appropriate compliance with the Securities Act) under the Securities Act of all Registrable
Securities which the Initiating Holders request to be registered, together with any Registrable
Securities of any Holder joining in such request as are specified in a notice given by any such
Holder to the Company within 20 days after receipt of the Company’s notice.

          (b) Underwritten Offering. If the Initiating Holders intend to distribute the Registrable
Securities covered by their request by means of an underwriting, they shall so advise the Company
as a part of their request made pursuant to this Section 2.1 and the Company shall include such
information in the written notice referred to in Section 2.1(a). The underwriter shall be selected
by the Company. The right of any Holder to include its Registrable Securities in such registration
shall be conditioned upon such Holder’s participation in such underwriting. All Holders proposing
to distribute Registrable Securities through such underwriting shall (together with the Company as
provided in Section 2.4(e)) enter into an underwriting agreement in customary form with the
underwriter or underwriters selected for such underwriting. Notwithstanding any other provision of
this Section 2.1, if the underwriter advises the Company and the Initiating Holders in writing that
marketing factors require a limitation of the number of shares to be underwritten, then the Company
shall so advise all Holders of Registrable Securities which would otherwise be underwritten
pursuant hereto, and the number of shares of Registrable Securities that may be included in the
underwriting shall be allocated among all participating Holders, including the Initiating Holders,
in proportion (rounded to the nearest 100 shares) to the amount of Registrable Securities of the
Company then owned by each participating Holder; provided, however,that the number of
shares of Registrable Securities to be included in such underwriting shall not be reduced unless
all other securities are first entirely excluded from the underwriting. For purposes of the
preceding apportionment, for any participating Holder that is a partnership, limited liability
company or corporation, the partners, retired partners, members, retired members and shareholders
of such Holder, or the estates and family members of any such partners, members, retired partners
or retired members and any trusts for the benefit of any of the foregoing Persons shall be deemed
to be a single “selling shareholder,” and any pro-rata reduction with respect to such
“selling shareholder” shall be based upon the aggregate amount of shares carrying registration
rights owned by all Persons included in such “selling shareholder,” as defined in this sentence.

          (c) Company Deferral. If the Company shall furnish to the Initiating Holders a certificate
signed by the Chairman of the Board stating that in the good faith judgment of the Board, it would
be seriously detrimental to the Company and its shareholders for such registration statement to be
filed 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

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more than 180 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 12-month period.

          (d) Maximum Number of Registrations. The Company shall not be obligated to effect, or to
take any action to effect, any registration pursuant to this Section 2.1 after the Company has
effected two registrations pursuant to this Section 2.1 and such registrations have been declared
or ordered effective and the securities offered pursuant to such registrations have been sold.

          (e) Lockout
Period. The Company shall not be obligated to effect, or to take any action to
effect, any registration pursuant to this Section 2.1 during the period starting with the date 90
days prior to the Company’s good faith estimate of the date of filing of, and ending on a date 180
days after the effective date of, a registration statement pertaining to an underwritten public
offering of the Company’s Registrable Securities; provided that if said registration
statement is not yet effective, the Company shall be actively employing in good faith all
commercially reasonable efforts to cause such registration statement to be filed and to become
effective.

     2.2 Company Registration.

          (a) Initiation. If (but without any obligation to do so) the Company proposes to register
(including for this purpose a registration effected by the Company for shareholders other than the
Holders) any of its stock in connection with the public offering of such securities solely for cash
(other than the Company’s IPO or an Exempt Registration), the Company shall, at such time, promptly
give each Holder notice of such registration. Upon the written request of each Holder given within
20 days after receipt by such Holder of the Company’s notice, the Company shall, subject to the
provisions of Section 2.2(b), cause to be registered all of the Registrable Securities that each
such Holder has requested to be registered.

          (b) Underwritten Offering. In connection with any offering involving an underwriting of
shares of the Company’s capital stock, the Company shall not be required under Section 2.2(a) to
include any of the Holders’ securities in such underwriting unless they accept the terms of the
underwriting as agreed upon between the Company and the underwriters selected by it (or by other
persons entitled to select the underwriters), and then only in such quantity as the underwriters
determine in their sole discretion will not jeopardize the success of the offering by the Company;
provided, however, except in the Company’s IPO in which case the representative may exclude all
shares to be sold by the Holders, that the Holders shall not be reduced to less than twenty five
percent (25%) of the aggregate shares offered; provided, however, that the number of shares
of Registrable Securities held by Investors to be included in such underwriting shall not be
reduced unless all other Registrable Securities and other securities are first entirely excluded
from the underwriting. In any apportionment pursuant to this
Section 2.2(b), the maximum number of
shares of the Company that Payam Zamani may include in any such offering shall be 750,000, provided
that in the event no apportionment is required, there shall be
no limitation on the number of Registrable Securities that Payam Zamani may include. If the total
amount of securities, including Registrable Securities, requested by shareholders to be included in
such offering exceeds the amount of securities sold, other than by the Company, that

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the underwriters determine in their sole discretion is compatible with the success of the offering,
then the Company shall be required to include in the offering only that number of such securities,
including Registrable Securities, which the underwriters determine in their sole discretion will
not jeopardize the success of the offering (the securities so included to be apportioned pro rata
(to the nearest 100 shares) among the selling shareholders according to the total amount of
securities entitled to be included therein owned by each selling shareholder or in such other
proportions as shall mutually be agreed to by such selling shareholders). For purposes of the
preceding apportionment, for any participating Holder that is a partnership, limited liability
company or corporation, the partners, retired partners, members, retired members and shareholders
of such Holder, or the estates and family members of any such partners, members, retired partners
or members and any trusts for the benefit of any of the foregoing Persons shall be deemed to be a
single “selling shareholder,” and any pro-rata reduction with respect to such “selling
shareholder” shall be based upon the aggregate amount of shares carrying registration rights owned
by all Persons included in such “selling shareholder,” as defined in this sentence.

          (c) Right to Terminate Registration. The Company shall have the right to terminate or
withdraw any registration initiated by it under this Section 2.2 prior to the effectiveness of such
registration whether or not any Holder has elected to include Registrable Securities in such
registration. The expenses of such withdrawn registration shall be borne by the Company in
accordance with Section 2.6(b) hereof.

     2.3 Form S-3 Registration.

          (a) Initiation. If the Company shall receive from any Holder or Holders of not
less than ten percent (10%) of the Registrable Securities then outstanding a written request or
requests that the Company effect a registration on Form S-3 with respect to all or a part of the
Registrable Securities owned by such Holder or Holders, the Company will promptly give written
notice of the proposed registration to all other Holders and as soon as practicable, effect such
registration of such Holder’s or Holders’ Registrable Securities as are specified in such request,
together with all or such portion of the Registrable Securities of any other Holder or Holders
joining in such request as are specified in a written request given within 15 days after receipt of
such notice from the Company.

          (b) Limitations. Notwithstanding Section 2.3(a), the Company shall not be obligated to
effect any such registration pursuant to this Section 2.3 (i) if Form S-3 is not available for such
offering by the Holders; (ii) if the Holders, together with the holders of any other securities of
the Company entitled for 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 one million dollars ($1,000,000); (iii) if the Company shall
furnish to the Holders a certificate signed by the Chairman of the Board stating that in the good
faith judgment of the Board, it would be
seriously detrimental to the Company and its shareholders 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 for a period of not more than 90 days after receipt of the request of the Holder or
Holders under this Section 2.3; provided, however, that the Company shall not utilize this
right more than once in any 12-month period; (iv) if the Company has, within the twelve-month
period preceding the date of such

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request, already effected two (2) registrations on Form S-3 for
the Holders pursuant to this Section 2.3; or (v) during the period ending 180 days after the
effective date of a registration statement pertaining to an underwritten public offering of the
Company’s Registrable Securities.

          (c) S-3’s not Demands. Registrations effected pursuant to this Section 2.3 shall not be
counted as demands for registration or registrations effected pursuant to Section 2.1.

          (d) Underwritten Offerings. The substantive provisions of Section 2.1(b) shall apply to the
registration if it relates to an underwritten offering.

     2.4 Obligations of the Company. Whenever required under this Section 2.4 to effect the
registration of any Registrable Securities, the Company shall, as expeditiously as reasonably
possible:

          (a) Prepare and file with the SEC a registration statement with respect to such Registrable
Securities and use all commercially reasonable efforts to cause such registration statement to
become effective, and, in the instances of a registration initiated pursuant to Section 2.1 or 2.3,
upon the request of the Holders of a majority of the Registrable Securities registered thereunder,
keep such registration statement effective for up to 120 days, or in the case of a registration
statement on Form S-3 filed pursuant to Rule 415 of the Securities Act, until such time as the
distribution of securities covered thereby has been completed.

          (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.

          (c) Furnish to the Holders 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 such Registrable Securities.

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

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

          (f) Promptly notify each Holder of Registrable Securities covered by the registration
statement at any time when the Company becomes aware of the happening of any event as a result of
which the registration statement or the prospectus included in such registration statement or any
supplement to the prospectus (as then in effect) contains any untrue

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statement of a material fact or omits to state a material fact necessary to make the statements therein (in the case of the
prospectus, in light of the circumstances under which they were made) not misleading or, if for any
other reason it shall be necessary during such time period to amend or supplement the registration
statement or the prospectus in order to comply with the Securities Act, whereupon, in either case,
each Holder shall immediately cease to use such registration statement or prospectus for any
purpose and, as promptly as practicable thereafter, the Company shall prepare and file with the
SEC, and furnish without charge to the appropriate Holders and managing underwriters, if any, a
supplement or amendment to such registration statement or prospectus which will correct such
statement or omission or effect such compliance and such copies thereof as the Holders and any
underwriters may reasonably request.

          (g) Cause all such Registrable Securities registered pursuant hereunder to be listed on each
securities exchange or over-the-counter market on which similar securities issued by the Company
are then listed, if applicable.

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

          (i) Use all commercially reasonable efforts to furnish, at the request of any 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 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 Holders
requesting registration of Registrable Securities (to the extent the then applicable standards of
professional conduct permit said letter to be addressed to the Holders).

          (j) Upon prior notice and during normal business hours, shall make all commercially reasonable
efforts to make available for inspection by any seller of Registrable Securities, any underwriter
participating in any disposition pursuant to such registration statement, and any attorney,
accountant or other agent retained by any such seller or underwriter, all financial and other
pertinent records, corporate documents and properties of the Company, and cause the Company’s
officers, directors, employees and independent accountants to supply all information reasonably
requested by any such seller, underwriter, attorney, accountant or agent in connection with such
registration statement; provided; however, that the Company shall not be obligated pursuant
to this Section 2.4(j) to provide access to any information which it reasonably considers to be a
trade secret or similar confidential information.

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     2.5 Furnish Information. It shall be a condition precedent to the obligations of the
Company to take any action pursuant to this Section 2 with respect to the Registrable Securities of
any selling Holder that such Holder shall furnish to the Company such information regarding itself,
the Registrable Securities held by it, and the intended method of disposition of such securities as
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 2.1 or
Section 2.3 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 2.1(a) or subsection 2.3(b), whichever is applicable.

     2.6 Expenses of Registration.

          (a) Demand and S-3 Registration. All expenses, other than underwriting discounts and
commissions, stock transfer taxes and fees and the fees and expenses of special counsel for the
selling Holders, incurred in connection with registrations initiated pursuant to Section 2.1 and
2.3, including all registration, filing .and qualification fees, printers’ and accounting fees, and
fees and disbursements of counsel for the Company, shall be borne by the Company; provided,
however, that the Company shall not be required to pay for any expenses of any registration
proceeding begun pursuant to Section 2.1 or 2.3 if the registration request is subsequently
withdrawn at the request of the Holders of a majority of the Registrable Securities to be
registered (in which case all participating Holders shall bear such expenses on a pro rata basis),
unless the Holders of a majority of the Registrable Securities agree to forfeit their right to one
demand registration pursuant to Section 2.1 or one S-3 registration pursuant to Section 2.3, as
applicable; provided further, however, that if at the time of such withdrawal, the Holders have
learned of a material adverse change in the condition, business, or prospects of the Company from
that known to the Holders at the time of their request and have withdrawn the request with
reasonable promptness following disclosure by the Company of such material adverse change, then the
Holders shall not be required to pay any of such expenses and shall retain their rights pursuant to
Section 2.1 and 2.3, as applicable. Expenses in excess of thirty five thousand dollars ($35,000)
for any special audit required in connection with a registration initiated pursuant to Section 2.1
shall be borne pro-rata by the selling Holders.

          (b) Company Registration. All expenses other than underwriting discounts and commissions and
fees and disbursements of special counsel for the selling Holders incurred in connection with
registrations of Registrable Securities initiated pursuant to Section 2.2, including (without
limitation) all registration, filing, and qualification fees, printers’ and accounting fees, and
fees and disbursements of counsel for the Company, shall be borne by the Company.

     2.7 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.

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

          (a) Indemnification by the Company. To the extent permitted by law, the Company will indemnify
and hold harmless each Holder, any underwriter (as defined in the Securities Act) for such Holder
and each Person, if any, who controls such Holder or underwriter within the meaning of the
Securities Act or the Exchange Act against any losses, claims, damages, or liabilities (joint or
several) to which they may become subject under the Securities Act, the Exchange Act or other
federal or state law, insofar as such losses, claims, damages, or liabilities (or actions in
respect thereof) arise out of or are based upon any of the following statements, omissions or
violations (collectively a “Violation”): (i) any untrue statement or alleged untrue statement of a
material fact contained in such registration statement, including any preliminary prospectus or
final prospectus contained therein or any amendments or supplements thereto, (ii) the omission or
alleged omission to state 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, 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 2.8(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) Indemnification by the Holders. To the extent permitted by law, each selling Holder will, if
Registrable Securities held by such Holder are included in the securities as to which such
registration, qualification or compliance is being effected, indemnify and hold harmless the
Company, each of its directors, each of its officers who has signed the registration statement,
each Person, if any, who controls the Company within the meaning of the Securities Act, any
underwriter, any other Holder selling securities in such registration statement and any controlling
Person of any such underwriter or other Holder, against any losses, claims, damages, or liabilities
(joint or several) to which any of the foregoing Persons may become subject, under the Securities
Act, the Exchange Act or other federal or state law, insofar as such losses, claims, damages, or
liabilities (or actions in respect thereto) arise out of or are based upon any Violation, in each
case to the extent (and only to the extent) that such Violation occurs in reliance upon and in
conformity with written information furnished by such Holder expressly for use in connection with
such registration; and each such Holder will pay, as incurred, any legal or other expenses
reasonably incurred by any Person intended to be indemnified pursuant to this Section 2.8(b), in
connection with investigating or defending any such loss, claim, damage, liability, or action;
provided, however, that the indemnity agreement contained in this Section 2.8(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

10

 

withheld; provided, that in no event shall any indemnity under this Section 2.8(b) exceed the net
proceeds from the offering received by such Holder, except in the case of willful fraud by such
Holder.

          (c) Procedures. Promptly after receipt by an indemnified party under this Section 2.8 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 2.8, deliver to the indemnifying party a written notice of the commencement thereof and the
indemnifying party shall have the right to participate in, and, to the extent the indemnifying
party so desires, jointly with any other indemnifying party similarly noticed, to assume the
defense thereof with counsel mutually satisfactory to the parties; provided, however, that an
indemnified party (together with all other indemnified parties which may be represented without
conflict by one counsel) shall have the right to retain one separate counsel, with the reasonable
fees and expenses to be paid by the indemnifying party, if representation of such indemnified party
by the counsel retained by the indemnifying party would be inappropriate due to actual or potential
differing interests between such indemnified party and any other party represented by such counsel
in such proceeding. The failure to deliver written notice to the indemnifying party within a
reasonable time of the commencement of any such action, if prejudicial to its ability to defend
such action, shall relieve such indemnifying party of any liability to the indemnified party under
this Section 2.8, 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 2.8. 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 to such claim or
litigation.

          (d) Contribution. If the indemnification provided for in this Section 2.8 is held by a court
of competent jurisdiction to be unavailable to an indemnified party with respect to any loss,
liability, claim, damage or expense referred to therein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage, or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying party on the one
hand and of the indemnified party on the other in connection with the statements or omissions that
resulted in such loss, liability, claim, damage or expense as well as any other relevant equitable
considerations; provided, that in no event shall any contribution by a Holder under this Section
2.8(d) exceed the net proceeds from the offering received by such Holder, except in the case of
willful fraud by such Holder. The relative fault of the indemnifying party and of the indemnified
party shall be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission 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) Underwriting Agreement. Notwithstanding the foregoing, to the extent that the provisions
on indemnification and contribution contained in the underwriting agreement

11

 

entered into in connection with the underwritten public offering are in conflict with the foregoing
provisions, the provisions in the underwriting agreement shall control.

          (f) Survival. The obligations of the Company and Holders under this Section 2.8 shall survive
the completion of any offering of Registrable Securities in a registration statement under this
Section 2, and otherwise.

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

          (a) make and keep public information available, as those terms are understood and defined in
SEC Rule 144, at all times after 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 Holders to use Form S-3 for the sale of their
Registrable Securities, such action to be taken as soon as practicable after the end of the fiscal
year in which the first registration statement filed by the Company for the offering of its equity
securities to the general public is declared effective;

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

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

     2.10 Assignment of Registration Rights. The rights to cause the Company to register securities
granted Holders under Sections 2.1, 2.2 and 2.3 may be assigned to a transferee or assignee in
connection with a transfer or assignment of at least fifty thousand (50,000) shares of Registrable
Securities by a Holder (or all of Holder’s shares, if less than fifty thousand (50,000) shares);
provided that (a) such transfer may otherwise be effected in accordance with applicable securities
laws and restrictions on transfer agreed upon by the Holder and the Company (including those set
forth in the Purchase Agreement), (b) prompt notice of such assignment is given to the Company, (c)
such transferee or assignee (i) is a wholly-owned subsidiary or affiliate, or a constituent
partner, retired partner, member, retired member or shareholder, of such

12

 

Holder, or (ii) is a spouse, lineal ancestor or descendant (including stepchildren and adopted
children) or (iii) is a trust for the benefit of such Holder or any spouse, lineal ancestor or
descendant (including stepchildren and adopted children) of such Holder, or (iv) acquires from such
Holder at least a majority of such Holder’s Registrable Securities (as appropriately adjusted for
stock splits and the like) and (d) such transferee or assignee agrees to be bound by all provisions
of this Agreement. Assignment of registration rights to a partner or affiliate of the Holders will
be without restriction as to minimum shareholdings.

     2.11 Limitations on Subsequent Registration Rights. From and after the date of this Agreement,
the Company shall not, without the prior written consent of the Holders of at least a majority of
the Registrable Securities then outstanding, enter into any agreement with any holder or
prospective holder of any securities of the Company which would allow such holder or prospective
holder (a) to include 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 such securities will not reduce the
amount of the Registrable Securities of the Holders ‘which is included, (b) to make a demand
registration which could result in such registration statement being declared effective prior to
the earlier of either of the dates set forth in Section 2.1(a) or within 180 days after the
effective date of any registration effected pursuant to Section 2.1 or (c) to initiate a request
that the Company effect a registration statement on Form S-3 when holding less than the requisite
percentage ownership as set forth in Section 2.3.

     2.12 Market-Standoff Agreement.

          (a) Market-Standoff Period; Agreement. In connection with a public offering of the Company’s
securities and upon request of the Company or the underwriters managing such offering of the
Company’s securities, each Holder hereby agrees not to sell, make any short sale of, loan, grant
any option for the purchase of, or otherwise dispose of any securities of the Company (other than
any disposed of in the registration and those acquired by the Holder in the registration or
thereafter in open market transactions, or any disposed of in a private transaction to a transferee
who agrees to be bound by the terms of this Section 2.12) without the prior written consent of the
Company or such underwriters, as the case may be, for such period of time not to exceed 180 days in
the case of the Company’s IPO from the effective date of such registration as may be requested by
the Company or such managing underwriters and to execute an agreement reflecting the foregoing as
may be requested by the underwriters at the time of the Company’s IPO; provided, however, that the
Holders shall not be bound by the restrictions set forth in this Section 2.12 unless all officers
and directors of the Company also agree to such restrictions.

          (b) Limitations. If the Company or the underwriter of any public offering of the Company’s
securities waives or terminates any standoff or lockup restrictions imposed on any holder of
securities of the Company, then such waiver or termination shall be granted to all Holders subject
to standoff or lockup restrictions pro rata based on the number of shares of Common Stock
beneficially held by such holder and the Holders. From and after the date of this Agreement, the
Company shall use its commercially reasonable efforts to ensure that all holders

13

 

of capital stock of the Company agree to be bound by terms substantially similar to those set forth
in this Section 2.12.

          (c) Stop-Transfer Instructions. In order to enforce the foregoing covenants, the Company may
impose stop-transfer instructions with respect to the securities of each Holder (and the securities
of every other person subject to the restrictions in Section 2.12(a)) until the end of such period.

          (d) Transferees Bound. Each Holder agrees that prior to the Company’s IPO it will not transfer
securities of the Company unless each transferee agrees in writing to be bound by all of the
provisions of this Section 2.12, provided that this Section 2.12(d) shall not apply to transfers
pursuant to a registration statement or transfers after the 12-month anniversary of the effective
date of the Company’s initial registration statement subject to this Section.

     2.13 Termination of Registration Rights. No Holder shall be entitled to exercise any
registration right with respect to Registrable Securities provided for in this Section 2 upon the
earlier of (a) the date four (4) years following the consummation of a Qualified IPO, (b) the date
that all such Registrable Securities held by such Holder may be sold pursuant to Rule 144 during
any ninety (90) day period, or (c) the acquisition of the Company.

3. Covenants of the Company.

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

          (a) as soon as practicable, but in any event within 90 days after the end of each fiscal year
of the Company, an income statement for such fiscal year, a balance sheet of the Company and
statement of shareholder’s equity as of the end of such year, and a statement of cash flows for
such year, such year-end financial reports to be in reasonable detail, prepared in accordance with
generally accepted accounting principles (“GAAP”), and audited and certified by an independent
public accounting firm selected by the Company;

          (b) as soon as practicable, but in any event within 30 days after the end of each month of
each fiscal year of the Company, an unaudited profit or loss statement, a statement of cash flows
for such month and an unaudited balance sheet as of the end of such month; and

          (c) as soon as practicable, but in any event 60 days after the end of each fiscal year, an
annual financial plan for the next fiscal year.

     3.2 Inspection. The Company shall permit each Major Investor or such Major Investor’s
representatives, at such Major Investor’s expense, to visit and inspect the Company’s properties,
to examine its books of account and records and to discuss the Company’s affairs, finances and
accounts with its officers, all at such reasonable times as may be requested by the Major Investor;
provided, however, that the Company shall not be obligated pursuant to this Section 3.2 to provide
access to any information which the Board of Directors has, in its sole reasonable discretion,
determined to be Confidential Information.

14

 

     3.3 Right of Participation.

          (a) Rights. If at any time, or from time to time, after the date hereof the Company decides to
issue additional shares of capital stock, options, warrants or rights or convertible securities to
purchase capital stock of the Company, or securities of any type whatsoever that are, or may become
exercisable or convertible into capital stock (“Additional Shares”), then the Company shall in
writing inform each Major Investor and Common Holder of the proposed terms of such issuance at
least twenty (20) days prior to such issuance and each Major Investor and Common Holder shall be
entitled at the time of each such proposed issuance to purchase the portion of the Additional
Shares offered equal to the product of (i) the Major Investor’s or Common Holder’s percentage
ownership of the Company, as applicable, immediately prior to the proposed issuance, multiplied by
(ii) the total amount of Additional Shares being sold by the Company. A Major Investor’s and Common
Holder’s percentage ownership of the Company equals the percentage of the outstanding Common Stock
of the Company held by such Major Investor or Common Holder immediately prior to the issuance of
the Additional Shares. For purposes of this Section 3.3, the outstanding Common Stock is the sum of
(A) outstanding shares of Common Stock, (B) shares of Common Stock issuable upon conversion of all
outstanding shares of Preferred Stock, (C) outstanding Convertible Securities and (D) all options
or other rights outstanding to subscribe to or purchase Common Stock or Convertible Securities (the
“Outstanding Common Stock”). For purposes of this Section 3.3, Common Holder excludes Victor Choy,
May One LLC, Timothy & Amy Ng and Donald Pickering.

          (b) Exercise
of Rights; Over-Allotment. In the event that a Major Investor elects to purchase
Additional Shares pursuant to this Section 3, the Major Investor shall deliver to the Company a
written request, no later than fifteen (15) days following receipt by the Major Investor of written
notice from the Company of the proposed issuance, for the allotment and issue of the number of
Additional Shares which the Major Investor desires to purchase. The Company shall promptly notify
in writing each Major Investor that purchases its full pro rata portion as calculated under Section
3.3(a) (a “Fully-Exercising Major Investor”) of any other Major Investor’s failure to do likewise.
During the ten (10) days commencing after receipt of such information, each Fully-Exercising Major
Investor shall be entitled to obtain that portion of the Additional Shares for which Major
Investors were entitled to subscribe but which were not subscribed for by the Major Investors (the
“Over-allotment Shares”) that is equal to the proportion of the outstanding Common Stock held by
such Fully-Exercising Major Investor bears to the total number of outstanding Common Stock held by
all Fully-Exercising Major Investors.

          (c) Price, Terms and Conditions. The price, terms and conditions at and upon which the Major
Investor and Common Holder may purchase such Additional Shares shall be the same price, terms and
conditions upon which the Additional Shares are sold by the Company to other Persons.

          (d) Exceptions. There shall be excepted from the operations of this Section 3.3 the following:

                    (i) shares issued pursuant to the Purchase Agreement;

15

 

               (ii) shares of Common Stock issued or issuable upon conversion of shares of Preferred Stock;

               (iii) shares of Common Stock issued or issuable to officers, directors or employees of, or
consultants to, the Company pursuant to a warrant, stock grant, option agreement or plan, purchase
plan or other employee stock incentive program or other agreement approved by the Board of
Directors;

               (iv) shares of Common Stock or other securities issued or issuable in connection with the
acquisition by the Company of all or part of another business entity by merger, purchase of assets
or capital stock or other reorganization that in each case has been approved by the Board of
Directors;

               (v) shares of Common Stock or other securities issued or issuable to lease companies, real
estate lessors, banks or financial institutions in connection with commercial credit arrangements,
equipment financings, leases or similar transactions that in each case has been approved by the
Board of Directors, provided such issuances are primarily for other than equity financing purposes;

               (vi) shares of Common Stock or Preferred Stock issuable upon exercise of warrants or notes, or
other rights to acquire the Company’s capital stock outstanding as of the date hereof.

               (vii) shares of Common Stock issued in connection with stock splits, combinations, reorganizations and the like;

               (viii) shares of Common Stock or other securities issued or
issuable in connection with a strategic partnership and/or acquisition of technology or
intellectual property approved by the Board of Directors;

               (ix) shares of Common Stock issued in a public offering of securities of the Company;

               (x) shares of Common Stock issued or issuable by way of dividend or other distribution on
shares of Common Stock excluded from the definition of Additional Shares of Common Stock by the
foregoing clauses (i) through (ix).

     3.4 Proprietary Information and Inventions Agreements. The Company will cause each officer,
employee and consultant now or hereafter employed by it or any subsidiary with access to
confidential information to enter into a proprietary information and inventions agreement
substantially in the form approved by the Board.

     3.5 Super-Majority Vote Required. The Company shall not, without first obtaining the approval
of at least 75% of the members of the Board of Directors: (i) incur debt in excess of four million
dollars ($4,000,000); (ii) provide guarantees or grant a security interest in material assets of
the Company or enter into similar transactions, other than to secure loans or advances under
existing or approved lines of credit; (iii) enter into any transaction involving the

16

 

acquisition of any product, technology or business (whether by purchase of assets, purchase of
stock, merger or otherwise), or enter into any joint venture where the value of such transaction
exceeds five million dollars ($5,000,000); (iv) increase the cash or equity compensation of any
officer of the Company without advance approval of the Compensation Committee; or (v) enter into
any transactions with affiliates.

     3.6 Stock Vesting. All shares of Common Stock of the Company issued after the First Closing to
officers, directors and employees of the Company will be subject to a five (5) year vesting period
as follows: 20% to vest at the end of the first year following issuance, with the remaining 80% to
vest monthly over four years. The agreements governing such issuances shall provide for a
repurchase option whereby upon the termination of employment of the shareholder, with or without
cause, the Company or its assignee shall have the right to repurchase at the lesser of cost or fair
market value any unvested shares held by such shareholder.

     3.7 Compliance with the Sarbanes-Oxley Act of 2002. The Company will work to amend the Board
membership to meet the provisions required of the Sarbanes-Oxley Act of 2002 and other corporate
governance requirements towards a registration of the Company’s Common Stock with the Securities
and Exchange Commission, including designation of a “lead outside director”.

     3.8 Committee Membership. The Scale Director shall have the right to be members of all
committees of the Board of Directors.

     3.9 Visitation Rights. The Scale Director and Outlook Director will each be entitled to
visitation rights for all meetings of the Board of Directors and its committees, whether or not its
designated representative is a member of the Board of Directors.

     3.10 Reimbursement of Expenses. The Company will reimburse the members of the Board for all
reasonable out-of-pocket expenses incurred after the First Closing, as that term is defined in the
Purchase Agreement, on behalf of the Company, including the attendance at Board and committee
meetings consistent with the Company’s travel expense policies.

     3.11 Observation Rights. From and after the date hereof and at all times throughout the term
of this Agreement, and provided that Outlook Ventures is not represented on the Board and continues
to own any Preferred Stock of the Company, Outlook Ventures will be entitled to have an observer at
all meetings of the Company’s Board of Directors (the “Board Observer”). Each Board Observer shall
be entitled to attend all meetings of the Board of Directors or any committee thereof and shall
receive (at the same time as such materials are sent to the members of the Board of Directors or
any committee thereof) (a) notice of all such meetings, (b) copies of all written consents and (c)
copies of all written materials. The Company shall have the right to exclude any of the Board
Observers from any deliberations of the Board relating to the business relationships between the
Company and the Board Observer(s). The Company shall not be required to provide the Board
Observer(s) with written materials relating to any such matters.

     3.12 Director & Officer Insurance. The Company will maintain directors’ and officers’
insurance in an amount deemed sufficient by the Board of Directors.

17

 

     3.13 Termination of Covenants. The covenants set forth in Sections 3.1, 3.2, 3.3 and 3.11
shall terminate as to each Holder and be of no further force or effect (i) immediately prior to the
consummation of a Qualified IPO, or (ii) upon the closing of a Corporate Sale (as defined in the
Company’s Articles of Incorporation, as amended to date); provided that no such termination under
clause (ii) shall be deemed to occur in connection with (A) a merger effected exclusively for the
purpose of changing the domicile of the Company or (B) the sale of shares of capital stock of the
Company in a transaction or series of related transactions effected primarily for equity financing
purposes.

4. Miscellaneous.

     4.1 New Shareholders. Notwithstanding anything herein to the contrary, if additional parties
purchase Series B Preferred Stock from the Company (each such party, a “New Shareholder”), then
each such New Shareholder shall become a party to this Agreement as an Investor hereunder, without
the need for any consent, approval or signature of any Investor, the Common Holders or the Company
when such New Shareholder has both: (a) purchased Series B Preferred Stock and paid the Company all
consideration payable for such shares and (b) executed one or more counterpart signature pages to
this Agreement as an Investor.

     4.2 Entire Agreement. This Agreement constitutes the entire agreement among 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 among any of the parties hereto are expressly superseded
hereby.

     4.3 Recapitalizations, Etc. Subject to Section 3 above, the provisions of this Agreement
(including any calculation of share ownership) shall apply, to the full extent set forth herein
with respect to the Registrable Securities and to the Common Stock, to any and all shares of
capital stock of the Company or any capital stock, partnership or member units or any other
security evidencing ownership interests in any successor or assign of the Company (whether by
merger, consolidation, sale of assets or otherwise) that may be issued in respect of, in exchange
for, or in substitution of the Common Stock by reason of any stock dividend, split, combination,
recapitalization, liquidation, reclassification, merger, consolidation or otherwise.

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

     4.5 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 Registrable Securities
then outstanding. Subject to the foregoing, the Investors and their successors and assigns
acknowledge that by operation of this Section 4.5, the holders of at least a

18

 

majority of the then outstanding Registrable Securities, when acting together with the
Company, will have the right and power to diminish or eliminate any rights or increase any or all
obligations under this Agreement. Notwithstanding the foregoing, the written consent of Outlook
Ventures shall be required, in addition to any other required consent, to amend, or to waive the
observance of, Section 3.11 herein. Notwithstanding the foregoing, the written consent of Scale
Venture Partners II, LP shall be required, in addition to any other required consent, to amend, or
to waive the observance of, Section 3.9 herein.

     4.6 Notices. All notices and other communications given or made pursuant hereto shall be in
writing and shall be deemed effectively given: (i) upon personal delivery to the party to be
notified, (ii) when sent by confirmed facsimile if sent during normal business hours of the
recipient; if not, then on the next business day, (iii) five (5) days after having been
sent by registered or certified mail, return receipt requested, postage prepaid, or (iv) one (1)
day after deposit with a nationally recognized overnight courier, specifying next day delivery,
with written verification of receipt. All communications shall be sent to the respective parties at
the addresses set forth on the signature pages attached hereto (or at such other addresses as shall
be specified by notice given in accordance with this Section 4.6), and if to the Company,
addressed to Reply! Inc., 12667 Alcosta Blvd., Suite 200, San Ramon, California 94583,
Attn: Payam Zamani, President, with a copy to DLA Piper US LLP, 2000 University Avenue, East
Palo Alto, California 94303, Attn: Andrew D. Zeif, Esq.

     4.7 Severability. Whenever possible, each provision of this Agreement shall be interpreted
in such manner as to be effective and valid under applicable law, but if any provision is held to
be prohibited by or invalid under applicable law, it shall be ineffective only to the extent of
such prohibition or invalidity, without invalidating the remainder of such provision or the
remaining provisions of this Agreement.

     4.8
Delays or Omissions; Remedies Cumulative. 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. All remedies, either under this Agreement or by law or
otherwise afforded to any party, shall be cumulative and not alternative.

     4.9 Costs of Enforcement. If any action at law or in equity (including arbitration) is
necessary to enforce or interpret the terms of any 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.

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

19

 

     4.11 Counterparts. This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute one and the same
instrument.

     4.12 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.

     4.13 Aggregation of Stock. All shares of Company stock held or acquired by affiliated
Persons (including former and current partners, former and current members and former and current
shareholders) shall be aggregated together for the purpose of determining the availability of any
rights under this Agreement.

     4.14 Confidentiality.

          (a) Each Holder agrees that (i) it will not disclose any Confidential Information disclosed to it
by the Company to any third party (except to its directors, officers, employees, agents, partners,
members, affiliates or advisors who have a need to know such Confidential Information and agree to
maintain the confidentiality thereof, and except to the extent required by applicable law,
regulation or legal process) or use such Confidential Information except as expressly permitted in
this Agreement and (ii) it will take all reasonable measures to maintain the confidentiality of all
Confidential Information in its possession or control, which will in no event be less than the
measures it uses to maintain the confidentiality of its own information of similar importance.

          (b) The provisions of this Section 4.14 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.

     4.15 Waiver of Preemptive Rights. By the execution of this Agreement, certain of the
Investors, who hold a majority of the Registrable Securities (as that term is defined in the Prior
Agreement) outstanding as of the date hereof, hereby agree to waive with respect to all Investors
all preemptive rights and rights to receive written notice of the transactions contemplated by the
Purchase Agreement.

[Signature Page Follows]

20

 

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

	 	 	 	 
	COMPANY:

REPLY! INC.

 	 
	By:  	/s/ Payam,Zamani
 	 
	 	Payam Zamani, 

President 

	 
	Address:  12667 Alcosta Blvd., Suite 200
San Ramon, CA 94583

Fax: (925) 947-2673 	 
	 

SIGNATURE PAGE TO AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

 

	 	 	 	 	 
	 	ENTITY INVESTOR:

Scale Venture Partners II, LP
 	 
	 	By:  	     Scale Venture Management II, LLC
 	 
	 	Its general partner

 	 
	 	 	 
	 	By:  	     /s/ Sharon Wienbar
 	 
	 	 	Name:  	Sharon Wienbar 	 
	 	 	Title: Managing Director

950 Tower Lane, Suite 700

Foster City, CA 94404

Tel: (650) 378-6017

Fax: (650) 378-6040 	 
	 

SIGNATURE PAGE TO AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

 

	 	 	 	 	 
	 	ENTITY INVESTOR:

Outlook Ventures IIP, LLP.

By Outlook Management II LLC
 	 
	 	By:  	/s/ Randy M. Haykin 	 
	 	 	Name:  	Randy Haykin 	 
	 	 	Its: Managing Director 	 
	 
	 
	 	Outlook Ventures III, L.P.

By Outlook Management III LLC
 	 
	 	By:  	/s/ Randy M. Haykin 	 
	 	 	Name: Randy M. Haykin

Its: Managing Director 	 

SIGNATURE PAGE TO AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

 

	 	 	 	 	 
	 	INDIVIDUAL INVESTOR:

DEBORAH COLEMAN	 
	 	 	 
	 	Signature:  	/s/ Deborah Coleman 	 
	 	 	Address:  Smart Forest Ventures 
319 SW Washington, 
Portland, OR 97204
	 

SIGNATURE PAGE TO AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

 

 

EXHIBIT A

INVESTORS

Scale Venture Partners II, LP

Outlook Ventures

Deborah Coleman

 

 

EXHIBIT B

COMMON HOLDERS

Payam Zamani

Behnam Behrouzi

John Truchard

Thomas Stone

Sean Fox

Bill Miles

Scott Oakley

Greg Little

Magnus Sublett

Jay Otlewski

Lynn Otlewski

Joe Otlewski

Peter Luft

Farhang Zamani

Frank Chimento

James Barrett

Steve Arentzoff

David Greene

Andre Crisp

Mark Tepper

Anthony Wilson

Victor Choy

May One LLC

Timothy & Amy Ng

Donald Pickering

Ted Wang

Brett Anderson

Behzad Behrouzi

Sahab Mahboubi

The David Family Living Trust dated 8/27/04

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