Document:

exv4w3

 

Exhibit 4.3

FIRST AMENDMENT

TO

INVESTORS’ RIGHTS AGREEMENT

     This First Amendment (this “Amendment”), dated as of this 17th day of March, 2005,
amends that certain Investors’ Rights Agreement dated as of January 28, 2004 (the
“Agreement”), by and among Restore Medical Inc., a Delaware corporation (f/k/a Restore
Medical, Inc., a Minnesota corporation) (the “Company”), the investors and other
stockholders of the Company listed on Schedule A thereto (the “Investors”) and the
holders of the Company’s capital stock listed on Schedule B, thereto (the
“Founders”).

     WHEREAS, pursuant to Section 9.7 of the Agreement, the parties reserved the right to amend the
Agreement; and

     WHEREAS, the undersigned parties to this Amendment include the Company, the holders of at
least a majority of Registrable Securities and the holders of at least a majority of the issued and
outstanding shares of Series C Preferred Stock, and therefore, as provided in Section 9.7 of the
Agreement, this Amendment shall be binding upon all parties to the Agreement; and

     WHEREAS, the undersigned parties to this Amendment desire to make certain modifications to the
terms of the right of first offer set forth in Section 2.4(d) of the Agreement; and

     WHEREAS, in connection with a working capital loan facility with Lighthouse Capital Partners
V, L.P. (“Lighthouse”), the Company will issue a warrant to Lighthouse to acquire shares of
the Company’s Series C-1 Preferred Stock (the “Warrant”); and

     WHEREAS, as a condition to the financing, the Company has agreed to grant Lighthouse
registration rights with respect to the shares of the Company’s Common Stock issuable upon
conversion of the Preferred Stock subject to the Warrant, and the Investors desire to amend the
Agreement to include Lighthouse thereunder.

     NOW, THEREFORE, in consideration of the foregoing, and for other good and valuable
consideration, the receipt and adequacy of which is hereby acknowledged, the parties hereto hereby
agree as follows:

     1. Section 2.4(d) is hereby amended in its entirety to read as follows:

     “(d) The right of first offer in this Section 2.4 shall not be applicable to (i) the
issuance or sale of shares of Common Stock (or options therefor) to employees, directors,
consultants and other service providers for the primary purpose of soliciting or retaining
their services pursuant to plans or agreements approved by the Company’s Board of Directors;
(ii) the issuance of securities pursuant to a bona fide, firmly underwritten public offering
of shares of Common Stock registered under the Act, (iii) the issuance of securities
pursuant to the conversion or exercise of convertible or exercisable securities, (iv) the
issuance of securities in connection with a bona fide business acquisition of or by

 

 

the Company, whether by merger, consolidation, sale of assets, sale or exchange of
stock or otherwise, (v) the issuance and sale of Series C Preferred Stock pursuant to the
Series C/C-1 Agreement, or (vi) the issuance of warrants to purchase up to an aggregate of
200,000 shares of Series C-1 Preferred Stock with a per share exercise price equal to at
least the fair market value as of the date of issue, as determined in good faith by the
corporation’s Board of Directors (and the Common Stock issuable upon conversion thereof) in
connection with the incurrence of indebtedness for money borrowed up to an aggregate of
$5,000,000 from recognized commercial lending institutions. In addition to the foregoing,
the right of first offer in this Section 2.4 shall not be applicable with respect to any
Investor in any subsequent offering of Shares if (i) at the time of such offering, the
Investor is not an “accredited investor,” as that term is then defined in Rule 501 (a) of
the Act and (ii) such offering of Shares is otherwise being offered only to accredited
investors.

     2. The Company and the Investors hereby amend the Agreement to include Lighthouse as a
“Holder” thereunder and to include the Common Stock issuable upon conversion of the Preferred Stock
issuable upon exercise of the Warrant as “Registrable Securities” thereunder.

     3. The definitions of “Holder” and “Registrable Securities” set forth in Section 1.1 of the
Agreement shall be amended in their entirety as set forth below:

     The term “Holder” means any person owning or having the right to acquire
Registrable Securities or any assignee thereof in accordance with Section 1.11 hereof, and
shall include, without limitation, Lighthouse.

     The term “Registrable Securities” means (i) the Common Stock issuable or issued
upon conversion of the Preferred Stock (ii) any Common Stock of the Company issued as (or
issuable upon the conversion or exercise of any warrant, right or other security that is
issued as) a dividend or other distribution with respect to, or in exchange for, or in
replacement of, the shares referenced in (i) above, excluding in all cases, however, any
Registrable Securities sold by a person in a transaction in which his rights under this
Section 1 are not assigned, and (iii) all shares of Common Stock of the Company now or
hereafter held by Lighthouse, including, without limitation, the shares of Common Stock
issued or issuable upon conversion of the shares of Series C-1 Preferred Stock or any other
convertible securities now or hereafter held by Lighthouse (including without limitation the
Series C-1 Preferred Stock or other securities issued or issuable upon exercise of the
Warrant or such other securities now or hereafter held by Lighthouse) or any shares of
Common Stock otherwise issuable under warrants held by Lighthouse”.

     4. The following new definition is added to Section 1.1 of the Agreement:

     “Lighthouse” means Lighthouse Capital Partners V, L.P.

     5. For purposes of the Agreement, Lighthouse and any other holder of the Warrant and the
Preferred Stock issuable upon exercise thereof shall be deemed to be the record holder or

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holders of the Registrable Securities issuable directly or indirectly upon exercise and
conversion thereof.

     6. All notices and other communications under the Agreement shall be made to Lighthouse at the
address specified below and thereafter at such other address, notice of which is given in
accordance with Section 9.5 of the Agreement:

Lighthouse Capital Partners V, L.P.

500 Drakes Landing Road

Greenbrae, California 94904-3011

Attn: Contract Administration

Phone: (415) 464-5900

Fax: (415) 925-3387

     7. Any capitalized term used herein and not otherwise defined herein shall have the meaning
given to such term in the Agreement.

     8. This Amendment constitutes an amendment of the Agreement in conformity with and pursuant to
the terms of Section 9.7 of the Agreement. Except as expressly amended herein, all terms set forth
in the Agreement shall continue in full force and effect.

     9. The operative terms of this Amendment may be inserted into an Amended and Restated
Agreement by the parties and shall have a date as of the day and year first set forth herein.

     10. This Amendment shall be governed by, and construed in accordance with, the laws of the
State of Minnesota, regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws thereof.

     11. This Amendment may be executed via facsimile in one or more counterparts, all of which
shall be considered one and the same agreement and shall become effective when one or more
counterparts have been signed by each of the parties and delivered to the other parties.

[Remainder of this page intentionally left blank; signature page follows]

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     IN WITNESS WHEREOF, the undersigned have caused this First Amendment to be duly executed, all
as of the date first written above.

	 	 	 	 	 	 	 
	 	 	COMPANY:	 	 
	 
	 	 	 	 	 	 
	 	 	RESTORE MEDICAL INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Susan L. Critzer
 

	 	 
	 

	 	 	 	Name: Susan L. Critzer	 	 
	 

	 	 	 	Title: Chief Executive Officer	 	 

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     Agreed and accepted as of the date first written above:

	 	 	 	 	 
	 	 	LIGHTHOUSE CAPITAL PARTNERS V, L.P.
	 
	 	 	 	 
	 

	 	By:
	 	LIGHTHOUSE MANAGEMENT
	 

	 	 	 	PARTNERS V, L.L.C., its general partner

	 	 	 	 	 	 	 
	 

	 	 By:
	 	/s/ Thomas Conneely
 

	 	 
	 

	 	 Name:
	 	Thomas Conneely
 

	 	 
	 

	 	 Title:
	 	Vice President
 

	 	 

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	 	 	INVESTORS:
	 
	 	 	 	 
	 	 	MPM BIOVENTURES II, LP
	 
	 	 	 	 
	 

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

	 	By:
	 	MP Asset Management H, LLC, its
General Partner

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Luke Evnin
 

	 	 
	 

	 	Name:
	 	Luke Evnin
 

	 	 
	 

	 	Its:
	 	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 Evnin
 

	 	 
	 

	 	Name:
	 	Luke Evnin
 

	 	 
	 

	 	Its:
	 	Manager
 

	 	 

	 	 	 	 	 
	 	 	MPM BIOVENTURES GMBH & CO
	 	 	PARALLEL-BETEILIGUNGS KG
	 
	 	 	 	 
	 

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

	 	By:
	 	MPM Asset Management II, LLC,
its General Partner

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Luke Evnin
 

	 	 
	 

	 	Name:
	 	Luke Evnin
 

	 	 
	 

	 	Its:
	 	Manager
 

	 	 

	 	 	 	 	 	 	 
	 	 	MPM ASSET MANAGEMENT
 INVESTORS 2000B LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Luke Evnin
 

	 	 
	 

	 	Name:
	 	Luke Evnin
 

	 	 
	 

	 	Its:
	 	Manager
 

	 	 

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	 	 	INVESTORS:	 	 
	 
	 	 	 	 	 	 
	 	 	CLS I-IV, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ A. Barr Dolan
 

	 	 
	 

	 	Name:
	 	 A. Barr Dolan
 

	 	 
	 

	 	Its:
	 	Manager
 

	 	 
	 
	 	 	 	 	 	 
	 	 	EVENTYR INVESTMENTS, L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Roe H. Hatlen
 

	 	 
	 

	 	Name:
	 	 Roe H. Hatlen
 

	 	 
	 

	 	Its:
	 	General Partner
 

	 	 
	 
	 	 	 	 	 	 
	 	 	VENTURI I, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mark B. Knudson
 

	 	 
	 

	 	 	 	Mark B. Knudson	 	 
	 

	 	 	 	Chairman	 	 
	 
	 	 	 	 	 	 

	 	 	 	 	 	 	 
	 

	 	 	 	/s/ Linda A. Johnson
 

	 	 
	 

	 	 	 	Linda A. Johnson	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	/s/ Mark B. Knudson
 

	 	 
	 

	 	 	 	Mark B. Knudson, Ph.D.	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	/s/ Timothy I. Maudlin
 

	 	 
	 

	 	 	 	Timothy I. Maudlin	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	/s/ Robert S. Nickloff
 

	 	 
	 

	 	 	 	Robert S. Nickoloff	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	/s/ Wes Sterman
 

	 	 
	 

	 	 	 	Wes Sterman	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	/s/ Brian Truax
 

	 	 
	 

	 	 	 	Brian Truax	 	 

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	 	 	 INVESTORS:
	 
	 	 	 	 
	 	 	 BESSEMER VENTURE PARTNERS VI L.P.
	 
	 	 	 	 
	 

	 	 By:
	 	Deer I & Co. LLC, General
	 

	 	 	 	Partner/Managing Member

	 	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ J. Edmund Colloton
 

	 	 
	 

	 	 	 	Name: J. Edmund Colloton	 	 
	 

	 	 	 	Title: Executive Manager	 	 
	 
	 	 	 	 	 	 

	 	 	 	 	 	 	 
	 

	 	 	 	/s/ Christopher Gabrieli
 

	 	 
	 

	 	 	 	Christopher Gabrieli	 	 

	 	 	 
	 

	 	TH LEE, PUTNAM INVESTMENT TRUST — TH LEE,
	 

	 	PUTNAM EMERGING OPPORTUNITIES PORTFOLIO

	 	 	 	 	 	 	 
	 

	 	By:
	 	TH Lee, Putnam Capital

	 	 
	 

	 	 	 	Management, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Charles A. Ruys de Perez
 

	 	 
	 

	 	 	 	Name: Charles A. Ruys de Perez	 	 
	 

	 	 	 	Title: Managing Director	 	 

	 	 	 	 	 	 	 
	 	 	GENERAL ELECTRIC PENSION TRUST	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	GE Asset Management Incorporated,	 	 
	 

	 	 	 	its Investment Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Patrick J. McNeela
 

	 	 
	 

	 	 	 	Name: Patrick J. McNeela	 	 
	 

	 	 	 	Title: Vice President	 	 

	 	 	 	 	 	 	 
	 	 	NGEN ENABLING TECHNOLOGIES FUND, L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Peter Grubstein
 

	 	 
	 

	 	 	 	Name: Peter Grubstein	 	 
	 

	 	 	 	Title: Managing Member	 	 

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Exhibit 4.4

March 30, 2005

Ms. Paula J. Norbom

Vice President, Finance

Restore Medical Inc.

2800 Patton Road

St. Paul, MN 55113

     Re:       Delivery of Audited Financial Statements

Dear Ms. Norbom:

     Reference is made to that certain Investors’ Rights Agreement dated as of January 28, 2004, as
amended by that certain First Amendment to Investors’ Rights Agreement dated as of March 17, 2005
(as further amended, restated, modified or supplemented from time to time, the “Investors’
Rights Agreement ”) by and among Restore Medical Inc., a Delaware corporation (f/k/a Restore
Medical, Inc., a Minnesota corporation) (the “Company”), the investors and other
stockholders of the Company listed on Schedule A thereto (the “Investors”) and the holders
of the Company’s capital stock listed on Schedule B thereto (the “Founders”). Unless
otherwise defined herein, capitalized terms used herein have the respective meanings assigned to
them in the Investors’ Rights Agreement.

     Under Section 2.1 (a) of the Investors’ Rights Agreement, the Company agreed to deliver to
each Major Investor 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 stockholders’ equity as of the end of such year, and a statement of cash
flows for such year, in each case audited and certified by independent public accountants of
nationally recognized standing selected by the Company. The failure by the Company to deliver
audited financial statements within 90 days following the end of each fiscal year would constitute
a breach of the covenant set forth in Section 2.1 (a) of the Investors’ Rights Agreement.

     Please be advised that the undersigned Investors hereby waive the requirement to deliver
audited financial statements to the Major Investors within 90 days following the end of each fiscal
year of the Company, including with respect to the fiscal year ended December 31, 2004 and each
year thereafter, on the condition that the Company shall deliver to the Major Investors the
financial statements required under Section 2.1(a) of the Investors’ Rights Agreement as soon as
practicable, and in any event no later than 120 days following the end of each fiscal year of the
Company. The foregoing waiver is expressly conditioned on the Company’s compliance with the
condition set forth in the preceding sentence.

     This waiver is specific in intent and does not constitute, nor should it be construed as, a
waiver of any default, whether retroactively or prospectively, of any other term or provision of
the Investors’ Rights Agreement.

 

 

     This waiver may be signed by facsimile and in any number of counterparts, each of which when
so executed and delivered shall be deemed an original, but all such counterparts together shall
constitute but one and the same instrument. This waiver shall not be effective until signed by the
Company, the holders of a majority of the Registrable Securities that are held by Major Investors,
and the holders of at least a majority of the issued and outstanding shares of Series C Preferred
Stock.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	MPM BIOVENTURES II, LP	 	 
	 
	 	 	 	 	 	 
	 

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

	 	By:
	 	MPM Asset Management II, LLC, its General Partner	 	 

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Luke Evnin	 	 
	 

	 	 	 	 

Name: Luke Evnin
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 

	 	 	 	 	 	 	 
	 	 	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 Evnin	 	 
	 

	 	 	 	 

Name: Luke Evnin
	 	 
	 

	 	 	 	Title:	 	 

	 	 	 	 	 	 	 
	 	 	MPM BIOVENTURES GMBH & CO PARALLEL-BETEILIGUNGS KG	 	 
	 
	 	 	 	 	 	 
	 

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

	 	By:
	 	MPM Asset Management II, LLC, its General
Partner	 	 

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Luke Evnin	 	 
	 

	 	 	 	 

Name: Luke Evnin
	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	MPM ASSET MANAGEMENT INVESTORS 2000B LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Luke Evnin	 	 
	 

	 	 	 	 

Name: Luke Evnin
	 	 
	 

	 	 	 	Title:	 	 

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	 	 	BESSEMER VENTURE PARTNERS VI L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Deer & Co. LLC, General Partner/Managing
Member	 	 

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ J. Edmund Colloton
 

	 	 
	 

	 	 	 	Name: J. Edmund Colloton	 	 
	 

	 	 	 	Title: Executive Manager	 	 

	 	 	 	 	 	 	 
	 	 	TH LEE, PUTNAM INVESTMENT TRUST — TH LEE, PUTNAM EMERGING
OPPORTUNITIES PORTFOLIO	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	TH Lee, Putnam Capital Management, LLC	 	 

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robert R. Leveille	 	 
	 

	 	 	 	 

Name: Robert R. Leveille
	 	 
	 

	 	 	 	Title: Senior Vice President	 	 

	 	 	 	 	 	 	 
	 	 	GENERAL ELECTRIC PENSION TRUST	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	GE Asset Management Incorporated, its
Investment Manager	 	 

	 	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Patrick J. McNeela	 	 
	 

	 	 	 	 

Name: Patrick J. McNeela
	 	 
	 

	 	 	 	Title: Vice President	 	 

	 	 	 	 	 	 	 
	 	 	NGEN ENABLING TECHNOLOGIES FUND, L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Peter Grubstein	 	 
	 

	 	 	 	 

Name: Peter Grubstein
	 	 
	 

	 	 	 	Title: Managing Member	 	 
	 
	 	 	 	 	 	 
	 	 	STATE STREET BANK AND
TRUST COMPANY

 AS TRUSTEE FOR
THE DUPONT PENSION TRUST
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

	 	 	 	 	 	 	 
	 	 	WILTON PRIVATE EQUITY FUND, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Wilton Asset Management, L.L.C., its Manager	 	 

	 	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 

Name:
	 	 
	 

	 	 	 	Title:	 	 

-3-

 

	 	 	 	 	 	 	 
	 	 	CLS I-IV, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ A. Barr Dolan
	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: A. Barr Dolan	 	 
	 

	 	 	 	Title:	 	 
	 
	 	 	 	 	 	 
	 	 	VENTURI I, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Mark B. Knudson	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Mark B. Knudson	 	 
	 

	 	 	 	Chairman	 	 

-4-

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