Initial Public Offering (IPO): Pre-Effective Amendment to Registration Statement (General Form) — Form S-1 Filing Table of Contents
Document/ExhibitDescriptionPagesSize
1: S-1/A Form S-1/A - Athenahealth, Inc. HTML 1.59M
9: CORRESP ¶ Comment-Response or Other Letter to the SEC HTML 66K
2: EX-3.1 EX-3.1 - Fifth Amended & Restated Certificate of HTML 97K Incorporation
3: EX-3.2 EX-3.2 - Sixth Amended & Restated Certificate of HTML 24K
Incorporation
4: EX-3.3 EX-3.3 - Amended & Restated Bylaws HTML 71K
7: EX-10.21 EX-10.21 - Loan & Security Agreement 42 177K
5: EX-10.4 EX-10.4 - 2007 Stock and Incentive Plan HTML 172K
6: EX-10.5 EX-10.5 2007 Employee Stock Purchase Plan HTML 30K
8: EX-23.1 EX-23.1 - Consent of Deloitte & Touche LLP HTML 7K
athenahealth, Inc., a corporation organized and existing under the laws of the State of
Delaware (the “Corporation”), hereby certifies as follows:
1. The name of the Corporation is athenahealth, Inc.. The date of the filing of its original
Certificate of Incorporation with the Secretary of State of the State of Delaware was August 21,1997 (the “Original Certificate”). The name under which the Corporation filed the Original
Certificate was Athena Healthcare Incorporated.
2. This Fifth Amended and Restated Certificate of Incorporation (the “Certificate”) amends,
restates and integrates the provisions of the Fourth Amended and Restated Certificate of
Incorporation that was filed with the Secretary of State of the State of Delaware on April 15, 2004
(the “Fourth Amended and Restated Certificate”), and was duly adopted in accordance with the
provisions of Sections 242 and 245 of the Delaware General Corporation Law (the “DGCL”).
3. The text of the Fourth Amended and Restated Certificate is hereby amended and restated in
its entirety to provide as herein set forth in full.
ARTICLE I
The name of the Corporation is athenahealth, Inc..
ARTICLE II
The address of the Corporation’s registered office in the State of Delaware is c/o The
Corporation Trust Company, 1209 Orange Street in the City of Wilmington, County of New Castle. The
name of its registered agent at such address is The Corporation Trust Company.
ARTICLE III
The purpose of the Corporation is to engage in any lawful act or activity for which
corporations may be organized under the DGCL.
ARTICLE IV
CAPITAL STOCK
The total number of shares of capital stock which the Corporation shall have authority to
issue is one-hundred fifty six million three hundred eighty nine thousand six hundred and eighty
four (156,389,684) shares, of which (i) one hundred twenty-five million (125,000,000) shares
shall be a class designated as common stock, par value $0.01 per share (the “Common Stock”),
(ii) twenty-six million three hundred eighty-nine thousand six hundred eighty-four (26,389,684)
shares shall be a class designated as convertible preferred stock, par value $0.01 per share (the
“pre-IPO Preferred Stock”), and (iii) five million (5,000,000) shares shall be a class designated
as undesignated preferred stock, par value $0.01 per share (the “Undesignated Preferred Stock” and,
together with the pre-IPO Preferred Stock, the “Preferred Stock”).
The number of authorized shares of the class of Common Stock and Undesignated Preferred Stock
may from time to time be increased or decreased (but not below the number of shares outstanding) by
the affirmative vote of the holders of a majority of the outstanding shares of Common Stock
entitled to vote, without a vote of the holders of the Preferred Stock (subject to the terms of the
pre-IPO Preferred Stock and except as otherwise provided in any certificate of designations of any
series of Undesignated Preferred Stock).
The voting powers, designations, preferences, powers and relative, participating, optional or
other special rights, and the qualifications, limitations or restrictions of each class of capital
stock of the Corporation, shall be as provided in this Article IV.
A. COMMON STOCK
Subject to all the rights, powers and preferences of the Preferred Stock and except as
provided by law or in this Article IV (or in any certificate of designations of any series of
Undesignated Preferred Stock):
(a) the holders of the Common Stock shall have the exclusive right to vote for the election of
directors of the Corporation (the “Directors”) and on all other matters requiring stockholder
action, each outstanding share entitling the holder thereof to one vote on each matter properly
submitted to the stockholders of the Corporation for their vote; provided, however, that, except as
otherwise required by law, holders of Common Stock, as such, shall not be entitled to vote on any
amendment to this Certificate (or on any amendment to a certificate of designations of any series
of Undesignated Preferred Stock) that alters or changes the powers, preferences, rights or other
terms of one or more outstanding series of Undesignated Preferred Stock if the holders of such
affected series are entitled to vote, either separately or together with the holders of one or more
other such series, on such amendment pursuant to this Certificate (or pursuant to a certificate of
designations of any series of Undesignated Preferred Stock) or pursuant to the DGCL;
(b) dividends may be declared and paid or set apart for payment upon the Common Stock out of
any assets or funds of the Corporation legally available for the payment of dividends, but only
when and as declared by the Board or any authorized committee thereof; and
(c) upon the voluntary or involuntary liquidation, dissolution or winding up of the
Corporation, the net assets of the Corporation shall be distributed pro rata to the holders of the
Common Stock.
B. PREFERRED STOCK
Section 1 through 5 of this Section B are intentionally omitted
6. Preferred Stock.
6.1 Designation. One Million Six Hundred Thousand (1,600,000) shares of the Preferred
Stock of the Corporation are hereby designated as “Series A-1 Convertible Preferred Stock”
and are hereinafter referred to as “Series A-1 Preferred;” One Million Forty-Five Thousand
Fifteen (1,045,015) shares of the Preferred Stock of the Corporation are hereby designated as
“Series A-2 Convertible Preferred Stock” and are hereinafter referred to as “Series A-2
Preferred;” One Million Two Hundred Fifty Thousand (1,250,000) shares of the Preferred Stock of
the Corporation are hereby designated as “Series B-1 Convertible Preferred Stock” and are
hereinafter referred to as “Series B-1 Preferred;” One Hundred Twenty-Seven Thousand Six
Hundred Five (127,605) shares of the Preferred Stock of the Corporation are hereby designated
“Series B-2 Convertible Preferred Stock” and are hereinafter referred to as “Series B-2
Preferred”; Eight Million (8,000,000) shares of the Preferred Stock of the Corporation are
hereby designated “Series C Convertible Preferred Stock” and are hereinafter referred to as
“Series C Preferred;” Twelve Million, Nine Hundred Seventy-Seven Thousand, Three Hundred
Eighty (12,977,380) shares of the Preferred Stock of the Corporation are hereby designated
“Series D Convertible Preferred Stock” and are hereinafter referred to as “Series D
Preferred;” and One Million, Three Hundred Eighty-Nine Thousand, Six Hundred Eighty-Four
(1,389,684) shares of the Preferred Stock of the Corporation are hereby designated “Series E
Convertible Preferred Stock” and are hereinafter referred to as “Series E Preferred”.
As used herein, the term “Preferred Stock” means collectively, the Series A-1 Preferred,
the Series A-2 Preferred, the Series B-1 Preferred, the Series B-2 Preferred, the Series C
Preferred, the Series D Preferred and the Series E Preferred, share for share alike and without
distinction as to series, except as otherwise expressly provided or as the context requires
otherwise.
6.2 Voting Power.
(a) General. Except as may be otherwise provided herein or by law, the Preferred
Stock shall vote with the Common Stock as a single class on all actions to be taken by the
stockholders of the Corporation. Each share of Preferred Stock shall entitle the holder thereof to
such number of votes per share on each such action as shall equal the number of whole shares of
Common Stock into which each such share of Preferred Stock is then convertible.
(b) Director Election Right. The holders of the outstanding shares of the Series C
Preferred, voting as a separate class, shall be entitled to elect two (2) directors of the
Corporation (the “Series C Directors”) and the holders of the outstanding shares of the
Series D Preferred, voting as a separate class, shall be entitled to elect one (1) director of the
Corporation (the “Series D Director,” and collectively with the Series C Directors, the
“Preferred Directors”). At any annual or special meeting of the Corporation (or in a
written consent in lieu thereof) held for the purpose of electing directors, the presence in person
or by proxy (or by written consent) of the holders of a majority of the outstanding shares of
Series C Preferred shall constitute a quorum for the election of the Series C Directors, and the
holders of a majority of the
outstanding shares of Series D Preferred shall constitute a quorum for the election of the Series D
Director. The Corporation agrees to reimburse the Preferred Directors for reasonable expenses
incurred in attending board meetings and performing work on behalf of the Corporation.
6.3 Dividends. No dividends (other than dividends or distributions payable solely in
shares of Common Stock of the Corporation) shall be paid or declared, and no other distribution
shall be made, on or with respect to the Common Stock of the Corporation unless and until (i)
dividends with respect to the Preferred Stock shall have been paid, or declared and set aside for
payment, in an amount which the holders of Preferred Stock would have received if they had
converted their Preferred Stock into Common Stock immediately prior to the record date for such
dividend or distribution, and (ii) the holders of the Series C Preferred, Series D Preferred and
Series E Preferred shall have received, in addition to the amount payable pursuant to the foregoing
clause (i), their Non-Cumulative Return for that fiscal year as described below. No dividends
shall be paid or declared, and no other distribution shall be made, on or with respect to either
the Series A-1 Preferred, the Series A-2 Preferred, the Series B-1 Preferred, or the Series B-2
Preferred unless and until (x) equivalent dividends (treating each series on an as converted basis)
with respect to the Series C Preferred, Series D Preferred and Series E Preferred shall have been
paid, or declared and set aside for payment, in an amount which the holders thereof would have
received if they had converted their Preferred Stock into Common Stock immediately prior to the
record date for such dividend or distribution, and (y) the holders of the Series C Preferred,
Series D Preferred and Series E Preferred shall have received, in addition to the amount payable
pursuant to the foregoing clause (x), their Non-Cumulative Return for that fiscal year as described
below. The holders of the Series C Preferred, Series D Preferred and Series E Preferred shall be
entitled to receive, on a pari passu basis, dividends at a rate of eight percent (8%) per annum,
payable as, if and when declared by the Board of Directors of the Corporation (the
“Non-Cumulative Return”). Such dividends shall not be cumulative, and, therefore, if not
declared in any fiscal year of the Corporation, the right to such dividend shall terminate and
shall not carry forward to the next fiscal year.
6.4 Liquidation. Upon any liquidation, dissolution or winding up of the Corporation,
whether voluntary or involuntary, the liquidation of the assets of the Corporation shall be
accomplished as follows:
(a) Before any distribution or payment is made upon any other capital stock of the
Corporation, holders of the Series E Preferred shall first be entitled to receive $5.04 from the
assets of the Corporation for each share of Series E Preferred plus any declared but unpaid
dividends thereon, which amount shall be subject to equitable adjustment whenever there shall occur
a stock dividend, stock split, combination, reorganization, recapitalization, reclassification, or
other similar event affecting the Series E Preferred. The amount to be received by holders of
Series E Preferred as aforesaid is referred to herein as the “Series E Liquidation Preference
Payment.” After payment of all preferential amounts to be paid to the holders of Series E
Preferred, the holders of Series D Preferred shall be entitled to receive $3.08 from the assets of
the Corporation for each share of Series D Preferred plus any declared but unpaid dividends
thereon, which amount shall be subject to equitable adjustment whenever there shall occur a stock
dividend, stock split, combination, reorganization, recapitalization, reclassification of similar
event affecting the Series D Preferred. The amount to be received by
holders of Series D Preferred as aforesaid is referred to herein as the “Series D Liquidation
Preference Payment.” After payment of all preferential amounts to be paid to the holders of
Series E Preferred and Series D Preferred, the holders of Series C Preferred shall be entitled to
receive $1.40 from the assets of the Corporation for each share of Series C Preferred plus any
declared but unpaid dividends thereon, which amount shall be subject to equitable adjustment
whenever there shall occur a stock dividend, stock split, combination, reorganization,
recapitalization, reclassification of similar event affecting the Series C Preferred. The amount
to be received by the holders of Series C Preferred as aforesaid is referred to herein as the
“Series C Liquidation Preference Payment.” After payment of all preferential amounts to be
paid to the holders of Series E Preferred, Series D Preferred and Series C Preferred, the holders
of the Series A-2 Preferred shall be entitled to receive $1.35 from the assets of the Corporation
for each share of Series A-2 Preferred, which amount shall be subject to equitable adjustment
whenever there shall occur a stock dividend, stock split, combination, reorganization,
recapitalization, reclassification or other similar event affecting the Series A-2 Preferred. The
amount to be received by holders of Series A-2 Preferred as aforesaid is referred to herein as the
“Series A-2 Liquidation Preference Payment.” After payment of all preferential amounts to
be paid to the holders of Series E Preferred, Series D Preferred, Series C Preferred and Series A-2
Preferred, the holders of the Series A-1 Preferred shall be entitled to receive $1.00 from the
assets of the Corporation for each share of Series A-1 Preferred, which amount shall be subject to
equitable adjustment whenever there shall occur a stock dividend, stock split, combination,
reorganization, recapitalization, reclassification or other similar event affecting the Series A-1
Preferred. The amount to be received by holders of Series A-1 Preferred as aforesaid is referred
to herein as the “Series A-1 Liquidation Preference Payment.” After payment of all
preferential amounts to be paid to the holders of Series E Preferred, Series D Preferred, Series C
Preferred, Series A-2 Preferred and Series A-1 Preferred, the holders of the Series B-2 Preferred
shall be entitled to receive $0.26 from the assets of the Corporation for each share of Series B-2
Preferred, which amount shall be subject to equitable adjustment wherever there shall occur a stock
dividend, stock split, combination, reorganization, recapitalization, reclassification or other
similar event affecting Series B-2 Preferred. The amount to be received by holders of Series B-2
Preferred as aforesaid is referred to herein as the “Series B-2 Liquidation Preference
Payment.” After payments of all preferential amounts to be paid to the holders of Series E
Preferred, Series D Preferred, Series C Preferred, Series A-2 Preferred, Series A-1 Preferred and
Series B-2 Preferred, the holders of the Series B-1 Preferred shall be entitled to receive $0.048
from the assets of the Corporation for each share of Series B-1 Preferred, which amount shall be
subject to equitable adjustment wherever there shall occur a stock dividend, stock split,
combination, reorganization, recapitalization, reclassification or other similar event affecting
the Series B-1 Preferred. The amount to be received by holders of Series B-1 Preferred as
aforesaid is referred to herein as the “Series B-1 Liquidation Preference Payment.”
(b) Upon any such liquidation, dissolution or winding up of the Corporation, if the assets of
the Corporation available for distribution to its stockholders shall be insufficient to permit the
payment in full of the Series E Liquidation Preference Payment, then the assets available for
distribution shall be distributed among the holders of the Series E Preferred ratably in proportion
to the full amount to which they would otherwise be entitled. If the assets of the Corporation
available for distribution to its stockholders in any such event exceed the amount of the Series E
Liquidation Preference Payment, the assets remaining after
payment of such amount shall be paid ratably to the holders of the Series D Preferred until they
have received full payment of the Series D Liquidation Preference Payment. If the assets of the
Corporation available for distribution to its stockholders in any such event exceed the amount of
the Series E Liquidation Preference Payment and the Series D Liquidation Preference Payment, the
assets remaining after payment of such amount shall be paid ratably to the holders of the Series C
Preferred until they have received full payment of the Series C Liquidation Preference Payment. If
the assets of the Corporation available for distribution to its stockholders in any such event
exceed the Series E Liquidation Preference Payment, Series D Liquidation Preference Payment and the
Series C Liquidation Preference Payment, the assets remaining after payment of such amounts shall
be paid ratably to the holders of the Series A-2 Preferred until they have received full payment of
the Series A-2 Liquidation Preference Payment. If the assets of the Corporation available for
distribution to its stockholders in any such event exceed the amount of the Series E Liquidation
Preference Payment, Series D Liquidation Preference Payment, Series C Liquidation Preference
Payment and Series A-2 Liquidation Preference Payment, the assets remaining after payment of such
amount shall be paid ratably to the holders of the Series A-1 Preferred until they have received
full payment of the Series A-1 Liquidation Preference Payment. If the assets of the Corporation
available for distribution to its stockholders in any such event exceed the amount of the Series E
Liquidation Preference Payment, Series D Liquidation Preference Payment, Series C Liquidation
Preference Payment, Series A-2 Liquidation Preference Payment and Series A-1 Liquidation Preference
Payment, the assets remaining after payment of such amount shall be paid ratably to the holders of
the Series B-2 Preferred until they have received full payment of the Series B-2 Liquidation
Preference Payment. If the assets of the Corporation available for distribution to its
stockholders in any such event exceed the amount of Series E Liquidation Preference Payment, Series
D Liquidation Preference Payment, Series C Liquidation Preference Payment, Series A-2 Liquidation
Preference Payment, Series A-1 Liquidation Preference Payment and Series B-2 Liquidation Preference
Payment, the assets remaining after payment of such amount shall be paid ratably to the holders of
Series B-1 Preferred until they have received full payment of the Series B-1 Liquidation Preference
Payment.
(c) Upon the completion of the distribution required by Paragraphs 6.4(a) and 6.4(b) above,
any remaining assets of the Corporation available for distribution shall be paid to the holders of
Common Stock, Series B-1 Preferred, Series C Preferred, Series D Preferred and Series E Preferred,
pro rata based upon the number of shares of Common Stock held by each such holder (as if full
conversion into Common Stock of all such Series B-1 Preferred, Series C Preferred, Series D
Preferred and Series E Preferred had occurred), provided however, that the distributions to the
holders of Series C Preferred shall be limited to $4.00 per share and the distribution to the
holders of Series D Preferred and Series E Preferred, shall each be limited to $7.70 per share (in
all such cases, adjusted for any stock splits, stock dividends, recapitalizations or the like)
including amounts paid pursuant to Paragraphs 6.4(a) and 6.4(b) above.
(d) Any reorganization, consolidation, merger or similar transaction or series of related
transactions of the Corporation or its subsidiaries with, by or into any other corporation or
corporations, or a sale, conveyance or disposition of all or substantially all of the assets of the
Corporation and its subsidiaries, including without limitation intangible assets, or a sale of the
outstanding capital stock of the Corporation, in each such case, such that the
stockholders of the Corporation prior to any such transaction or series of related
transactions receive or retain in such transaction or series of related transactions less than 50%
of the voting power of the surviving corporation following the closing of such transaction or
series of related transactions, shall be deemed to be a liquidation, dissolution or winding up of
the Corporation within the meaning of this Section 6.4.
(e) Written notice of such liquidation, dissolution or winding up, stating a payment date and
the place where such payments shall be made, shall be given by mail, postage prepaid, or by fax,
not less than 30 days prior to the payment date stated therein to the holders of record of
Preferred Stock, such notice to be addressed to each such holder at its address as shown by the
records of the Corporation.
(f) In lieu of receiving the preferential amounts specified in Paragraphs 6.4(a), 6.4(b) and
6.4(c) above, the holders of Preferred Stock may elect to convert such Preferred Stock to Common
Stock pursuant to Paragraph 6.5.
6.5 Conversions. The holders of shares of Preferred Stock shall have the following
conversion rights:
(a) Right to Convert. Subject to the terms and conditions of this Section 6.5, the
holder of any share or shares of Preferred Stock shall have the right, at its option at any time
(except that upon any liquidation of the Corporation the right of conversion shall terminate at the
close of business on the business day fixed for payment of the amount distributable on the
Preferred Stock), to convert any such shares into such number of fully paid and nonassessable
shares of Common Stock as is determined by dividing the Conversion Value (as hereinafter defined)
by the Conversion Price (as hereinafter defined) in effect at the time of conversion. The
Conversion Value shall equal at any time the product obtained by multiplying the number of shares
of Preferred Stock to be converted by (i) $5.04, with respect to the Series E Preferred, (ii)
$3.08, with respect to the Series D Preferred, (iii) $1.40, with respect to the Series C Preferred,
(iv) $1.35, with respect to the Series A-2 Preferred, (v) $1.00, with respect to the Series A-1
Preferred, (vi) $0.26, with respect to the Series B-2 Preferred, and (vii) $0.048, with respect to
the Series B-1 Preferred (with all such dollar amounts to be adjusted appropriately in the event of
any stock dividend, stock split, combination or similar event affecting the Preferred Stock). The
initial Conversion Price, as of the date this Fifth Amended and Restated Certificate of
Incorporation is filed with the Secretary of State of the State of Delaware, shall be $5.04 per
share of Series E Preferred, $3.08 per share of Series D Preferred, $1.40 per share of Series C
Preferred, $1.35 per share of Series A-2 Preferred, $1.00 per share of Series A-1 Preferred, $0.26
per share of Series B-2 Preferred, and $0.048 per share of Series B-1 Preferred and in each case
shall be subject to adjustment as hereinafter provided. The rights of conversion referenced above
shall be exercised by the holder thereof giving written notice that the holder elects to convert a
stated number of shares of Preferred Stock into Common Stock and by surrender of a certificate or
certificates for the shares so to be converted to the Corporation. Any declared and unpaid
dividends on such Preferred Stock being converted shall remain payable to the holders converting
such shares on the specified payment date therefor.
(b) Issuance of Certificates; Time Conversion Effected. Promptly after the receipt
of the written notice referred to in subparagraph 6.5(a) and surrender of the certificate or
certificates for the share or shares of Preferred Stock to be converted, the Corporation shall
issue and deliver to the holder a certificate or certificates, registered in such name or names as
such holder may direct, for the number of whole shares of Common Stock issuable upon the conversion
of such share or shares of Preferred Stock. To the extent permitted by law, such conversion shall
be deemed to have been effected and the Conversion Price shall be determined, as of the close of
business on the date on which such written notice shall have been received by the Corporation and
the certificate or certificates for such share or shares shall have been surrendered as aforesaid,
and at such time the rights of the holder of such share or shares of Preferred Stock shall cease,
and the person or persons in whose name or names any certificate or certificates for shares of
Common Stock shall be issuable upon such conversion shall be deemed to have become the holder or
holders of record of the shares represented thereby.
(c) Fractional Shares; Dividends; Partial Conversion. No fractional shares shall be
issued upon conversion of Preferred Stock into Common Stock. If any fractional share of Common
Stock would, except for the provisions of the foregoing sentence, be delivered upon such
conversion, the Corporation, in lieu of delivering such fractional share, shall pay to the holder
surrendering the Preferred Stock for conversion an amount in cash equal to the greater of (i) the
current market price of such fractional share as determined in good faith by the Board of Directors
of the Corporation and (ii) the pro rata amount of the Conversion Price of such fractional share.
No payment or adjustment shall be made upon any conversion on account of any cash dividends on the
Common Stock issued upon such conversion, the record date for which dividends is prior to the date
such conversion is deemed to be effective as provided in subparagraph 6.5(b). Any declared and
unpaid dividends on such Preferred Stock being converted shall remain payable to the holders
converting such shares on the specified payment date therefor. In case the number of shares of
Preferred Stock represented by the certificate or certificates surrendered pursuant to subparagraph
6.5(b) exceeds the number of shares converted, the Corporation shall, upon such conversion, execute
and deliver to the holder, at the expense of the Corporation, a new certificate or certificates for
the number of shares of Preferred Stock represented by the certificate or certificates surrendered
which are not to be converted.
(d) Adjustment of Conversion Price Upon Issuance of Common Stock. Except as provided
in subparagraph 6.5(f) and 6.5(g) below, if and whenever the Corporation shall issue or sell or is,
in accordance with subparagraphs 6.5(d)(i) through 6.5(d)(vi), deemed to have issued or sold any
shares of Common Stock for a consideration per share less than the Conversion Price for the Series
A-1 Preferred, Series A-2 Preferred, Series B-2 Preferred, Series C Preferred, Series D Preferred
or Series E Preferred in effect immediately prior to the time of such issuance or sale, then,
forthwith upon such issuance or sale, the Conversion Price applicable to such series of Preferred
Stock shall be reduced to an amount equal to the quotient obtained by dividing:
(x) an amount equal to the sum of (i) the number of shares of all Common Stock issued
and outstanding or deemed in accordance with subparagraphs 6.5(d)(i) through 6.5(d)(vi)
hereof to be issued and outstanding immediately prior to such issuance or sale (with each
share of Preferred Stock being deemed for such purpose to be equal to the number of shares
of Common Stock,
including fractions of a share, into which such share is convertible immediately prior to
such issuance or sale) multiplied by the Conversion Price for such series of Preferred
Stock, subject to this adjustment in effect immediately prior to the time of such issuance
or sale, plus (ii) the aggregate consideration received by the Corporation for such issuance
or sale,
by
(y) an amount equal to the sum of (i) the total number of shares of Common Stock issued
and outstanding or deemed in accordance with subparagraphs 6.5(d)(i) through 6.5(d)(vi)
hereof to be issued and outstanding immediately prior to such issuance or sale (with each
share of Preferred Stock being deemed for such purpose to be equal to the number of shares
of Common Stock, including fractions of a share, into which such share is convertible
immediately prior to such issuance or sale), plus (ii) the number of shares of Common Stock
actually issued or sold or deemed to have been issued or sold in accordance with
subparagraphs 6.5(d)(i) through 6.5(d)(vi) hereof.
For purposes of this subparagraph (d), the following subparagraphs (i) to (vi) shall also be
applicable:
(i) Issuance of Rights or Options. In case at any time the Corporation shall in any
manner grant (whether directly or by assumption in a merger or otherwise) any warrants or other
rights to subscribe for or to purchase, or any options for the purchase of, Common Stock or any
stock or security convertible into or exchangeable for Common Stock (such warrants, rights or
options being called “Options” and such convertible or exchangeable stock or securities
being called “Convertible Securities”) whether or not such Options or the right to convert
or exchange any such Convertible Securities are immediately exercisable, and the price per share
for which Common Stock is issuable upon the exercise of such Options or upon the conversion or
exchange of such Convertible Securities (determined by dividing (i) the total amount, if any,
received or receivable by the Corporation as consideration for the granting of such Options, plus
the minimum aggregate amount of additional consideration payable to the Corporation upon the
exercise of all such Options, plus, in the case of such Options which relate to Convertible
Securities, the minimum aggregate amount of additional consideration, if any, payable upon the
issuance or sale of such Convertible Securities and upon the conversion or exchange thereof, by
(ii) the total maximum number of shares of Common Stock issuable upon the exercise of such Options
or upon the conversion or exchange of all such Convertible Securities issuable upon the exercise of
such Options) shall be less than the Conversion Price in effect and applicable to the Series A-1
Preferred, Series A-2 Preferred, Series B-2 Preferred, Series C Preferred, Series D Preferred or
Series E Preferred immediately prior to the time of the granting of such Options or the issuance or
sale of Convertible Securities, then the shares of Common Stock issuable upon the exercise of such
Options or upon conversion or exchange of such Convertible Securities issuable upon the exercise of
such Options shall be deemed to have been issued for such price per share as of the date of
granting of such Options or the issuance of such Convertible Securities and thereafter shall be
deemed to be outstanding. Except as otherwise provided in subparagraph d(iii), no adjustment of
the Conversion Price for any such series of Preferred Stock shall be made thereafter upon the
actual issuance of such
Common Stock or of such Convertible Securities upon exercise of such Options or upon the actual
issuance of such Common Stock upon conversion or exchange of such Convertible Securities.
(ii) Issuance of Convertible Securities. In case the Corporation shall in any manner
issue (whether directly or by assumption in a merger or otherwise) or sell any Convertible
Securities, whether or not the rights to exchange or convert any such Convertible Securities are
immediately exercisable, and the price per share for which Common Stock is issuable upon such
conversion or exchange (determined by dividing (x) the total amount received or receivable by the
Corporation as consideration for the issuance or sale of such Convertible Securities, plus the
minimum aggregate amount of additional consideration, if any, payable to the Corporation upon the
conversion or exchange thereof, by (y) the total maximum number of shares of Common Stock issuable
upon the conversion or exchange of all such Convertible Securities) shall be less than the
Conversion Price in effect and applicable to the Series A-1 Preferred, Series A-2 Preferred, Series
B-2 Preferred, Series C Preferred, Series D Preferred or Series E Preferred immediately prior to
the time of such issuance or sale, then the shares of Common Stock issuable upon conversion or
exchange of such Convertible Securities shall be deemed to have been issued for such price per
share as of the date of the issuance or sale of such Convertible Securities and thereafter shall be
deemed to be outstanding. Except as otherwise provided in subparagraph (d)(iii), no further
adjustment of the Conversion Price for any such series of Preferred Stock shall be made thereafter
upon the actual issuance of such Common Stock or upon conversion or exchange of such Convertible
Securities. If any such issuance or sale of such Convertible Securities is made upon exercise of
any options to purchase any such Convertible Securities for which adjustments of the Conversion
Price for any series of Preferred Stock have been or are to be made pursuant to other provisions of
this subparagraph (d), no further adjustment of such Conversion Price shall be made by reason of
such issuance or sale.
(iii) Change in Option Price or Conversion Rate. Upon the happening of any of the
following events, namely, if the purchase price provided for in any Option referred to in
subparagraph (d)(i), the additional consideration, if any, payable upon the conversion or exchange
of any Convertible Securities referred to in subparagraph (d)(i) or (d)(ii), or the rate at which
Convertible Securities referred to in subparagraph (d)(i) or (d)(ii) are convertible into or
exchangeable for Common Stock shall change at any time (including, but not limited to, changes
under or by reason of provisions designed to protect against dilution), the Conversion Price for
the Series A-1 Preferred, Series A-2 Preferred, Series B-2 Preferred, Series C Preferred, Series D
Preferred or Series E Preferred in effect at the time of such event shall forthwith be readjusted
to the Conversion Price for such series of Preferred Stock which would have been in effect at such
time had such Options or Convertible Securities still outstanding provided for such changed
purchase price, additional consideration or conversion rate, as the case may be, at the time
initially granted, issued or sold, but only if as a result of such adjustment, such Conversion
Price then in effect hereunder is thereby reduced; and on the expiration of any such Options
without exercise of any thereof or the termination of any such right to convert or exchange such
Convertible Securities without conversion or exchange of any thereof, the Conversion Price for such
series of Preferred Stock then in effect hereunder shall
forthwith be increased to the Conversion Price which would have been in effect at the time of such
expiration or termination had such Option or Convertible Securities never been issued.
(iv) Consideration for Stock. In case any shares of Common Stock, Options or
Convertible Securities shall be issued or sold for cash, the consideration received therefor shall
be deemed to be the amount received by the Corporation therefor, without deduction therefrom of any
expenses incurred or any underwriting commissions or concessions paid or allowed by the Corporation
in connection therewith. In case any shares of Common Stock, Options or Convertible Securities
shall be issued or sold for a consideration other than cash, the amount of the consideration other
than cash received by the Corporation shall be deemed to be the fair value of such consideration as
determined in good faith by the Board of Directors of the Corporation, without deduction therefrom
of any expenses incurred or any underwriting commissions or concessions paid or allowed by the
Corporation in connection therewith. In case any Options shall be issued in connection with the
issuance and sale of other securities of the Corporation, together comprising one integral
transaction in which no specific consideration is allocated to such Options by the parties thereto,
such Options shall be deemed to have been issued for such consideration as determined in good faith
by the Board of Directors of the Corporation.
(v) Record Date. In case the Corporation shall take a record of the holders of its
Common Stock for the purpose of entitling them (x) to receive a dividend or other distribution
payable in Common Stock, Options or Convertible Securities or (y) to subscribe for or purchase
Common Stock, Options or Convertible Securities, then such record date shall be deemed to be the
date of the issuance or sale of the shares of Common Stock deemed to have been issued or sold upon
the declaration of such dividend or the making of such other distribution or the date of the
granting of such right of subscription or purchase, as the case may be.
(vi) Treasury Shares. The disposition of any shares owned or held by or for the
account of the Corporation shall be considered an issuance or sale of Common Stock for the purposes
of this subparagraph 6.5(d).
(e) Automatic Conversion upon Public Offering or Election.
(i) All outstanding shares of Preferred Stock shall automatically convert to shares of Common
Stock, at the then applicable conversion rate in the event of the closing of a firm commitment,
underwritten public offering of shares of the Corporation at a public offering price of at least
Seven Dollars and Fifty-Six Cents ($7.56) per share (as adjusted for a stock dividend, stock split,
combination, reorganization, recapitalization, reclassification, or other similar event affecting
the Preferred Stock) resulting in aggregate gross proceeds to the Company equal to or greater than
Fifty Million Dollars ($50,000,000.00) (a “Qualified Public Offering”).
(ii) All outstanding shares of Series D Preferred, Series C Preferred, Series A-2 Preferred,
Series A-1 Preferred, Series B-2 Preferred and Series B-1 Preferred shall automatically convert to
shares of Common Stock, at the then applicable conversion rate, upon the vote, set forth in a
written notice to the Corporation, of holders of Sixty-Six and Two-Thirds
Percent (66 2/3%) in interest of the outstanding Series D Preferred, Series C Preferred,
Series A-2 Preferred, Series A-1 Preferred, Series B-2 Preferred and Series B-1 Preferred, voting
together as a single class on an as-converted to Common Stock basis.
(iii) All outstanding shares of Series E Preferred shall automatically convert to shares of
Common Stock, at the then applicable conversion rate, upon the vote, set forth in a written notice
to the Corporation, of holders of Sixty-Six and Two-Thirds Percent (66 2/3%) in interest of the
Series E Preferred, voting together as a single class on an as-converted to Common Stock basis.
Upon the occurrence of any of the conversion events specified in this subparagraph 6.5(e), the
holders of the applicable series of Preferred Stock shall be subject to the provisions set forth in
subparagraph 6.5(b) above regarding issuance of certificates upon conversion and effective time of
conversion.
(f) Certain Issuances of Common Stock Excepted. Anything herein to the contrary
notwithstanding, the Corporation shall not be required to make any adjustment of the Conversion
Price for any series of Preferred Stock upon issuance of:
(i) Common Stock upon the conversion of any shares of Series E Preferred, Series D Preferred,
Series C Preferred, Series A-2 Preferred, Series A-1 Preferred, Series B-2 Preferred or Series B-1
Preferred; or
(ii) shares of the Corporation’s Common Stock or related options or purchase agreements or
other rights to acquire Common Stock issued to employees, officers and directors of, and
consultants, customers, and vendors to, the Corporation or one of its subsidiaries or affiliated
clinics, pursuant to any arrangement approved by at least a majority of the Board of Directors of
the Corporation, including the Preferred Directors (other than capital stock or related options or
purchase agreements, warrants, capital appreciation rights, calls, convertible shares or other
rights issued in transactions with the primary purpose of raising capital); or
(iii) securities issued as consideration in connection with the acquisition of another
corporation, partnership, limited liability company or other entity by the Corporation by merger,
purchase of all or substantially all of the assets, or purchase of not less than 51% of the stock;
or
(iv) any issuance of shares, options or warrants to be issued with the approval of the
Preferred Directors, to (x) lenders in conjunction with the borrowing of working capital by the
Corporation or (y) equipment leasing organizations in conjunction with any equipment leasing
arrangements to which the Corporation is a party.
(g) Certain Holders of Preferred Stock Excepted. Anything to the contrary
notwithstanding in subparagraph 6.5(d):
(i) If the Corporation proposes to undertake a Dilutive Financing (as defined below) with respect
to any series of Preferred Stock (other than any series of “Shadow Preferred Stock” as defined
below), the Corporation shall give each holder of shares of such series of Preferred Stock written
notice (the “Issuance Notice”) of such intention, describing in full detail the type and
number of new securities to be issued, the price thereof and the terms and conditions upon which
the Corporation proposes to effectuate such issuance. Each holder of shares of such series of
Preferred Stock shall have fifteen (15) days from the date of the Issuance Notice to agree to
purchase all or part of its Pro Rata Fraction of the securities in the Dilutive Financing for the
price and upon the terms and conditions specified in the Issuance Notice, by giving written notice
to the Company stating the quantity of such securities to be so purchased. If such holder fails to
give such notice within the fifteen (15) day period, or fails to purchase its full Pro Rata
Fraction (other than as a result of the refusal by the Corporation (or by other security holders
who hold rights to purchase such securities) to allow such holder to so purchase its full Pro Rata
Fraction), such holder shall be deemed to be a Nonparticipating Holder.
(ii) To the extent of the percentage of the full Pro Rata Fraction not purchased (the “Refused
Percentage”) by each Nonparticipating Holder, that number of outstanding shares of Preferred
Stock of the relevant series held by such Nonparticipating Holder equal to the product of (x) the
number of shares of Preferred Stock of such series held by such Nonparticipating Holder, times (y)
the Refused Percentage (with any fraction in the resulting number of shares being rounded up to the
next higher whole number), shall no longer be entitled to any adjustments to the Conversion Price
applicable to such series of Preferred Stock (if any), pursuant to subparagraph 6.5(d) and such
Nonparticipating Holder, as to the number of shares of Preferred Stock of such series resulting
from such calculation (the “Nonparticipating Shares”), shall be deemed to have waived,
effective as of the closing (or first closing, if more than one closing) of the Dilutive Financing,
(i) the reduction in the Conversion Price applicable to such series of Preferred Stock (if any)
that would have resulted pursuant to subparagraph 6.5(d) from such, or any subsequent, issuance or
sale, or deemed issuance or sale, and (ii) the right to receive, upon conversion of such holder’s
Nonparticipating Shares, any additional shares of Common Stock that would have been issuable as a
result of such reduction in such Conversion Price (if any), and such waiver shall be binding upon
any transferee of the Nonparticipating Shares. If the application of the foregoing results in
there being more than one Conversion Price for a particular series of Preferred Stock, then the
Nonparticipating Shares held by each such Nonparticipating Holder shall automatically and without
further action on the part of such holder be converted effective subject to and concurrently with
the consummation of the Dilutive Financing (the “Dilutive Financing Date”) as follows:
each Nonparticipating Share held by such Nonparticipating Holder shall be converted into one share
of a newly created series of Preferred Stock (having such number of shares as the Board of
Directors may by resolution fix) (each such newly created series of Preferred Stock, a “Shadow
Preferred Stock” series) which such Shadow Preferred Stock series shall be identical in all
respects to the applicable series of Preferred Stock of the Nonparticipating Shares, except that
the Conversion Price of such Shadow Preferred Stock series shall be fixed immediately prior to the
Dilutive Financing Date and shall be subject to no further adjustments in a manner similar to that
provided in this subparagraph 6.5(g). The Board of Directors shall take all necessary actions to
designate such new Shadow Preferred Stock series. Upon such conversion of Nonparticipating Shares
into Shadow Preferred Stock, the Nonparticipating Shares so converted shall be cancelled and not
subject to reissuance.
(iii) The holder of any Nonparticipating Shares of Shadow Preferred Stock pursuant to this
subparagraph 6.5(g) hereof shall deliver to the Corporation during regular business hours at the
office of any transfer agent of the Corporation for the Preferred Stock, or at such other place as
may be designated by the Corporation, the certificate or certificates for the Nonparticipating
Shares so converted, duly endorsed or assigned in blank or to the Corporation. As promptly as
practicable thereafter, the Corporation shall issue and deliver to such holder, at the place
designated by such holder, a certificate or certificates for the number of full shares of the new
series of Shadow Preferred Stock to which such holder is entitled. The person in whose name the
certificate for such new series of Shadow Preferred Stock is to be issued shall be deemed to have
become a stockholder of record on the Dilutive Financing Date unless the transfer books of the
Corporation are closed on that date, in which event he shall be deemed to have become a stockholder
of record on the next succeeding date on which the transfer books are open.
(iv) For the purposes of this subparagraph 6.5(g):
(i) a “Dilutive Financing” with respect to any series of Preferred Stock (other than any
series of Shadow Preferred Stock) shall mean the issuance or sale or deemed issuance or sale, of
any shares of Common Stock for a consideration per share less than the Conversion Price for such
series in effect immediately prior to the time of such issuance or sale, or deemed issuance or
sale, but shall not include the issuances or deemed issuances specified in subparagraph 6.5(f).
(ii) “Pro Rata Fraction” for a holder shall mean a fraction, the numerator of which shall
be the number of shares of Common Stock issuable upon conversion of all shares of all series of
Preferred Stock (other than any series of Shadow Preferred Stock) held by such holder and the
denominator of which shall be the aggregate number of shares of Common Stock outstanding (with all
shares of Preferred Stock included on an as-if-converted basis, other than any shares of Shadow
Preferred Stock).
(h) Subdivision or Combination of Common Stock. In case the Corporation shall at any time
subdivide (by any stock split, stock dividend or otherwise) its outstanding shares of Common Stock
into a greater number of shares, the Conversion Price for each series of Preferred Stock in effect
immediately prior to such subdivision shall be proportionately reduced, and, conversely, in case
the outstanding shares of Common Stock shall be combined into a smaller number of shares, the
Conversion Price for each series of Preferred Stock in effect immediately prior to such combination
shall be proportionately increased.
(i) Reorganization or Reclassification. Subject to the provisions of Section 6.4 above, if
any capital reorganization or reclassification of the capital stock of the Corporation shall be
effected in such a way that holders of Common Stock shall be entitled to receive stock, securities
or assets with respect to or in exchange for Common Stock, then, as a condition of such
reorganization or reclassification, lawful and adequate provisions shall be made whereby each
holder of shares of Preferred Stock shall thereupon have the right to receive, upon the basis and
upon the terms and conditions specified herein and in lieu of the shares of Common Stock
immediately theretofore receivable upon the conversion of such shares of Preferred Stock, such
shares of stock, securities or assets as may be issued or payable with respect to or in exchange
for a number of outstanding shares of such Common Stock equal to the number of shares of such
Common Stock receivable upon such conversion had such reorganization or reclassification not taken
place, and in any such case appropriate provision shall be made with respect to the rights and
interests of such holder to the end that the provisions hereof (including without limitation
provisions for adjustments of the applicable Conversion Price) shall thereafter be applicable, as
nearly as may be, in relation to any shares of stock, securities or assets thereafter deliverable
upon the exercise of such conversion rights.
(j) Notice of Adjustment. Upon any adjustment of the Conversion Price for any series of
Preferred Stock, the Corporation shall give written notice thereof, by first class mail, postage
prepaid or by facsimile, addressed to each holder of shares of Preferred Stock at the address of
such holder as shown on the books of the Corporation, which notice shall state the Conversion Price
for the series of Preferred Stock resulting from such adjustment, setting forth in reasonable
detail the calculation upon which such adjustment is based.
(k) Other Notices. In case at any time:
(i) the Corporation shall declare any dividend upon its Common Stock payable in cash or stock
or make any other distribution to the holders of its Common Stock;
(ii) the Corporation shall offer for subscription prorata to the holders of
its Common Stock any additional shares of stock of any class, or other rights;
(iii) there shall be any capital reorganization or reclassification of the capital stock of
the Corporation, or a consolidation or merger of the Corporation with or into, or a sale of all or
substantially all its assets to, another entity or entities; or
(iv) there shall be a voluntary or involuntary dissolution, liquidation or winding up of the
Corporation;
then, in any one or more of said cases, the Corporation shall give, by first class mail, postage
prepaid, or by facsimile, addressed to each holder of any shares of Preferred Stock at the address
of such holder as shown on the books of the Corporation, (i) at least 10 days’ prior written notice
of the date on which the books of the Corporation shall close or a record shall be taken for such
dividend, distribution or subscription rights or for determining rights to vote in respect of any
such reorganization, reclassification, consolidation, merger, sale, dissolution, liquidation or
winding up and (ii) in the case of any such reorganization, reclassification, consolidation,
merger, sale, dissolution, liquidation or winding up, at least 20 days’ prior written notice of the
date when the same shall take place. Such notice in accordance with the foregoing clause shall
also specify (1) in the case of any such dividend, distribution or subscription rights, the date on
which the holders of Common Stock shall be entitled thereto and (2) the date on which the holders
of Common Stock shall be entitled to exchange their Common Stock for securities or
other property deliverable upon any such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up, as the case may be.
(l) Stock to be Reserved. The Corporation will at all times reserve and keep
available out of its authorized Common Stock, solely for the purpose of issuance upon the
conversion of Preferred Stock as herein provided, such number of shares of Common Stock as shall
then be issuable upon the conversion of all outstanding shares of Preferred Stock. The Corporation
covenants that all shares of Common Stock which shall be so issued shall be duly and validly issued
and fully paid and nonassessable and free from all taxes, liens and charges with respect to the
issuance thereof; provided that the Corporation shall not be required to pay any tax which may be
payable in respect of any transfer involved in the issuance and delivery of any certificate in a
name other than that of the holder of the Preferred Stock which is being converted.
(m) Definition of Common Stock. As used herein, the term “Common Stock” shall
mean and include the Corporation’s authorized Common Stock, $0.01 par value per share, as
constituted on the date of filing of this Fifth Amended and Restated Certificate of Incorporation,
and shall also include any capital stock of any class of the Corporation thereafter authorized
which shall neither be limited to a fixed sum or percentage of par value in respect of the rights
of the holders thereof to participate in dividends nor entitled to a preference in the distribution
of assets upon the voluntary or involuntary liquidation, dissolution or winding up of the
Corporation; provided that the shares of Common Stock receivable upon conversion of shares of
Preferred Stock shall include only shares designated as Common Stock of the Corporation on the date
of filing of this instrument, or in case of any reorganization or reclassification of the
outstanding shares thereof, the stock, securities or assets provided for in subparagraph 6.5(h).
6.6 Extraordinary Corporate Transactions.
(a) Except to the extent the following covenants and provisions of this Section 6.6(a) are
waived in any instance by the holders of at least a majority of the outstanding shares of Series C
Preferred or as otherwise specifically approved by the Board of Directors, which approval must
include the affirmative vote or consent of the Series C Directors, the Corporation will not, until
the occurrence of a Qualified Public Offering:
1. Create, authorize or issue any class or series of capital stock with equity features or
convertible into equity ranking on a parity with or senior to the Series C Preferred with respect
to liquidation preferences, dilution protection, redemption rights, or payment of dividends, or
otherwise having terms and conditions superior to the terms of the Series C Preferred.
2. Materially adversely change the rights, preferences or privileges of the Series C Preferred
or increase the authorized number of shares of the Series C Preferred.
3. Sell, lease or otherwise dispose of (i) all or substantially all of the assets of the
Corporation or any majority-owned subsidiary of the Corporation or (ii) any majority-owned
subsidiary.
4. Adopt a plan of liquidation, dissolution or winding up for the Corporation or any
majority-owned subsidiary of the Corporation.
5. Engage in any consolidation or merger with or into any other person or entity, or any other
corporate reorganization, in which the stockholders of the Corporation or any majority-owned
subsidiary of the Corporation immediately prior to such consolidation, merger or reorganization,
own less than 50% of the voting power of the Corporation, such subsidiary or other entity surviving
such transaction immediately after such transaction, or any transaction or series of related
transactions in which in excess of 50% of the voting power of the Corporation or such subsidiary,
as applicable, is transferred.
6. Increase or decrease the size of the Board of Directors.
(b) Except to the extent the following covenants and provisions of this Section 6.6(b) are
waived in any instance by the holders of at least a Sixty-Six and Two-Thirds Percent (66 2/3%) in
interest of the outstanding shares of Series D Preferred or as otherwise specifically approved by
the Board of Directors, which approval must include the affirmative vote or consent of the Series D
Director, the Corporation will not, until the occurrence of a Qualified Public Offering:
1. Create, authorize or issue any class or series of capital stock with equity features or
convertible into equity ranking on a parity with or senior to the Series D Preferred with respect
to liquidation preferences, dilution protection, redemption rights, or payment of dividends, or
otherwise having terms and conditions superior to the terms of the Series D Preferred (whether by
amendment to this Fifth Amended and Restated Certificate of Incorporation, merger, consolidation or
otherwise).
2. Materially adversely change the rights, preferences or privileges of the Series D Preferred
(whether by amendment to this Fifth Amended and Restated Certificate of Incorporation, merger,
consolidation or otherwise) or increase the authorized number of shares of the Series D Preferred.
3. Sell, lease or otherwise dispose of (i) all or substantially all of the assets of the
Corporation or any majority-owned subsidiary of the Corporation or (ii) any majority-owned
subsidiary of the Corporation.
4. Adopt a plan of liquidation, dissolution or winding up for the Corporation or any
majority-owned subsidiary of the Corporation.
5. Engage in any consolidation or merger with or into any other person or entity, or any other
corporate reorganization, in which the stockholders of the Corporation or any majority-owned
subsidiary of the Corporation immediately prior to such consolidation, merger or reorganization,
own less than 50% of the voting power of the
Corporation, such subsidiary or other entity surviving such transaction immediately after such
transaction, or any transaction or series of related transactions in which in excess of 50% of the
voting power of the Corporation or such subsidiary, as applicable, is transferred.
6. Increase or decrease the size of the Board of Directors.
7. Purchase or set aside any sums for the purchase of, or pay any dividend or make any
distribution on, any shares of stock other than the Preferred Stock, except for dividends or other
distributions payable on the Common Stock solely in the form of additional shares of Common Stock
and except for the purchase of shares of Common Stock from former employees of the Corporation who
acquired such shares directly from the Corporation, if each such purchase is made pursuant to
contractual rights held by the Corporation relating to the termination of employment of such former
employee and the purchase price does not exceed the original issue price paid by such former
employee to the Corporation of such shares.
8. Redeem or otherwise acquire any shares of Preferred Stock except as expressly authorized in
paragraph 7 hereof or pursuant to a purchase offer made pro rata to all holders of the shares of
Preferred Stock on the basis of the aggregate number of outstanding shares of Preferred Stock then
held by each such holder.
(c) Except to the extent the following covenants and provisions of this Section 6.6(c) are
waived in writing in any instance by the holders of at least a Sixty-Six and Two-Thirds Percent (66
2/3%) in interest of the outstanding shares of Series E Preferred, the Corporation will not, until
the occurrence of a Qualified Public Offering:
1. Create, authorize or issue any class or series of capital stock with equity features or
convertible into equity ranking on a parity with or senior to the Series E Preferred with respect
to liquidation preferences, dilution protection, redemption rights, or payment of dividends, or
otherwise having terms and conditions superior or equal to the terms of the Series E Preferred
(whether by amendment to this Fifth Amended and Restated Certificate of Incorporation, merger,
consolidation or otherwise).
2. Alter or change the rights, preferences or privileges of the Series E Preferred (whether by
amendment to this Fifth Amended and Restated Certificate of Incorporation, merger, consolidation or
otherwise).
6.7 Restrictions on Alteration of Rights.
(a) At any time when shares of Series A-1 Preferred are outstanding, in addition to any other
vote required by law or the Corporation’s Fifth Amended and Restated Certificate of Incorporation,
the Corporation will not without the approval of the holders of at least a majority of the then
outstanding shares of Series A-1 Preferred, voting as a class, either in writing or by ballot at a
duly called meeting, increase the authorized number of shares of Series A-1 Preferred or alter the
powers, preferences or rights of the holders of shares of Series A-1 Preferred so as to affect them
adversely; provided, however, that for purposes of the foregoing provision, the Corporation’s
authorization of one or more series of securities with rights ranking senior to or
equal to the rights designated to the Series A-1 Preferred shall not be deemed to affect the
holders thereof adversely.
(b) At any time when shares of Series A-2 Preferred are outstanding, in addition to any other
vote required by law or the Corporation’s Fifth Amended and Restated Certificate of Incorporation,
the Corporation will not without the approval of the holders of at least a majority of the then
outstanding shares of Series A-2 Preferred, voting as a class, either in writing or by ballot at a
duly called meeting, increase the authorized number of shares of Series A-2 Preferred or alter the
powers, preferences or rights of the holders of shares of Series A-2 Preferred so as to affect them
adversely; provided, however, that for purposes of the foregoing provision, the Corporation’s
authorization of one or series of securities with rights ranking senior to or equal to the rights
designated to the Series A-2 Preferred shall not be deemed to affect the holders thereof adversely.
(c) At any time when shares of Series B-1 Preferred are outstanding, in addition to any other
vote required by law or the Corporation’s Fifth Amended and Restated Certificate of Incorporation,
the Corporation will not without the approval of the holders of at least a majority of the then
outstanding shares of Series B-1 Preferred, voting as a class, either in writing or by ballot at a
duly called meeting, increase the authorized number of shares of Series B-1 Preferred or alter the
powers, preferences or rights of the holders of shares of Series B-1 Preferred so as to affect them
adversely; provided, however, that for purposes of the foregoing provision, the Corporation’s
authorization of one or more series of securities with rights ranking senior to or equal to the
rights designated to the Series B-1 Preferred shall not be deemed to affect the holders thereof
adversely.
(d) At any time when shares of Series B-2 Preferred are outstanding, in addition to any other
vote required by law or the Corporation’s Fifth Amended and Restated Certificate of Incorporation,
the Corporation will not without the approval of the holders of at least a majority of the then
outstanding shares of Series B-2 Preferred, voting as a class, either in writing or by ballot at a
duly called meeting, increase the authorized number of shares of Series B-2 Preferred or alter the
powers, preferences or rights of the holders of shares of Series B-2 Preferred so as to affect them
adversely; provided, however, that for purposes of the foregoing provision, the Corporation’s
authorization of one or more series of securities with rights ranking senior to or equal to the
rights designated to the Series B-2 Preferred shall not be deemed to affect the holders thereof
adversely.
7. Redemption. The shares of Series E Preferred and Series D Preferred shall be
redeemed as follows:
7A. Optional Redemption. On or after April 15, 2009, at the written election of the
holders of at least two-thirds in interest of the Series E Preferred and Series D Preferred, voting
together as a single class, and upon notice to the Corporation, the Corporation shall redeem on the
date specified in the notice (the “First Redemption Date”), 50% of all of the shares of
Series E Preferred and Series D Preferred then outstanding. The Corporation shall redeem the
remaining outstanding shares of Series E Preferred and Series D Preferred on the first
anniversary of the First Redemption Date (the “Second Redemption Date”, and collectively
with the First Redemption Date, the “Redemption Dates”).
7B. Redemption Price and Payment. The shares of Series E Preferred to be redeemed on
any Redemption Date shall be redeemed by paying for each share in cash an amount equal to $5.04 per
share plus, in the case of each share, an amount equal to all dividends declared but unpaid
thereon, computed to such Redemption Date, such amount being referred to as the “Series E
Redemption Price”. The shares of Series D Preferred to be redeemed on any Redemption Date
shall be redeemed by paying for each share in cash an amount equal to $3.08 per share plus, in the
case of each share, an amount equal to all dividends declared but unpaid thereon, computed to such
Redemption Date, such amount being referred to as the “Series DRedemption Price”.
Such payment shall be made in full on the applicable Redemption Date to the holders entitled
thereto.
7C. Redemption Mechanics. At least 20, but not more than 30 days prior to each
Redemption Date, written notice (the “Redemption Notice”) shall be given by the Corporation
by delivery in person, certified or registered mail, return receipt requested, telecopier or telex,
to each holder of record (at the close of business on the business day next preceding the day on
which the Redemption Notice is given) of shares of Series E Preferred and Series D Preferred
notifying such holder of the redemption and specifying the Series E Redemption Price and Series D
Redemption Price, as applicable, the Redemption Dates, the number of shares of Series E Preferred
and Series D Preferred, as applicable, to be redeemed from such holder on each Redemption Date
(computed on a pro rata basis in accordance with the number of such shares held by all holders
thereof) and the place where said Series E Redemption Price and Series D Redemption Price, as
applicable, shall be payable. The Redemption Notice shall be addressed to each holder at his
address as shown by the records of the Corporation. From and after the close of business on a
Redemption Date, unless there shall have been a default in the payment of the Series E Redemption
Price and Series D Redemption Price, as applicable, all rights of holders of shares of Series E
Preferred and Series D Preferred (except the right to receive the Redemption Price) shall cease
with respect to the shares to be redeemed on such Redemption Date, and such shares shall not
thereafter be transferred on the books of the Corporation or be deemed to be outstanding for any
purpose whatsoever. If the funds of the Corporation legally available for redemption of shares of
Series E Preferred and Series D Preferred on a Redemption Date are insufficient to redeem the total
number of shares of Series E Preferred and Series D Preferred to be redeemed on such Redemption
Date, the holders of such shares shall share ratably in any funds legally available for redemption
of such shares according to the respective amounts which would be payable to them if the full
number of shares to be redeemed on such Redemption Date were actually redeemed. The shares of
Series E Preferred and Series D Preferred required to be redeemed but not so redeemed shall remain
outstanding and entitled to all rights and preferences provided herein. At any time thereafter
when additional funds of the Corporation are legally available for the redemption of such shares of
Series E Preferred and Series D Preferred, such funds will be used, at the end of the next
succeeding fiscal quarter, to redeem the balance of such shares, or such portion thereof for which
funds are then legally available, on the basis set forth above.
7D. Redeemed Shares to be Retired. Any shares of Series E Preferred and Series D
Preferred redeemed pursuant to this paragraph 7 shall be cancelled and shall not under any
circumstances be reissued; and the Corporation may from time to time take such appropriate
corporate action as may be necessary to reduce accordingly the number of authorized shares of
Series E Preferred and Series D Preferred.
C. UNDESIGNATED PREFERRED STOCK
The Board of Directors or any authorized committee thereof is expressly authorized, to the
fullest extent permitted by law, to provide for the issuance of the shares of Undesignated
Preferred Stock in one or more series of such stock, and by filing a certificate pursuant to
applicable law of the State of Delaware, to establish or change from time to time the number of
shares of each such series, and to fix the designations, powers, including voting powers, full or
limited, or no voting powers, preferences and the relative, participating, optional or other
special rights of the shares of each series and any qualifications, limitations and restrictions
thereof.
ARTICLE V
STOCKHOLDER ACTION
Effective from and after the mandatory conversion of all outstanding shares of pre-IPO Preferred
pursuant to Section 6.5(e) of Part B of Article IV of this Certificate of Incorporation (the time
at which such mandatory conversion occurs being referred to herein as the “Mandatory Conversion
Time”):
1. Action without Meeting. Except as otherwise provided herein, any action required
or permitted to be taken by the stockholders of the Corporation at any annual or special meeting of
stockholders of the Corporation must be effected at a duly called annual or special meeting of
stockholders and may not be taken or effected by a written consent of stockholders in lieu thereof.
2. Special Meetings. Except as otherwise required by statute and subject to the
rights, if any, of the holders of any series of Undesignated Preferred Stock, special meetings of
the stockholders of the Corporation may be called only by the Board of Directors acting pursuant to
a resolution approved by the affirmative vote of a majority of the Directors then in office. Only
those matters set forth in the notice of the special meeting may be considered or acted upon at a
special meeting of stockholders of the Corporation.
ARTICLE VI
DIRECTORS
A. Before and after the Mandatory Conversion Time:
1. General. The business and affairs of the Corporation shall be managed by or under
the direction of the Board of Directors except as otherwise provided herein or required by law.
A. Effective from and after the Mandatory Conversion Time:
2. Election of Directors. Election of Directors need not be by written ballot unless
the By-laws of the Corporation (the “By-laws”) shall so provide.
3. Number of Directors; Term of Office. The number of Directors of the Corporation
shall be fixed solely and exclusively by resolution duly adopted from time to time by the Board of
Directors. The Directors, other than those who may be elected by the holders of any series or
class of Preferred Stock, shall be classified, with respect to the term for which they severally
hold office, into three classes, as nearly equal in number as reasonably possible. The initial
Class I Directors of the Corporation shall be Bryan Roberts, Jonathan Bush and Brandon Hull; the
initial Class II Directors of the Corporation shall be Ann Lamont, Richard Foster and James Mann;
and the initial Class III Directors of the Corporation shall be John Kane and Ruben King-Shaw, Jr.
The initial Class I Directors shall serve for a term expiring at the annual meeting of stockholders
to be held in 2008, the initial Class II Directors shall serve for a term expiring at the annual
meeting of stockholders to be held in 2009, and the initial Class III Directors shall serve for a
term expiring at the annual meeting of stockholders to be held in 2010. At each annual meeting of
stockholders, Directors elected to succeed those Directors whose terms expire shall be elected for
a term of office to expire at the third succeeding annual meeting of stockholders after their
election. Notwithstanding the foregoing, the Directors elected to each class shall hold office
until their successors are duly elected and qualified or until their earlier resignation, death or
removal.
Notwithstanding the foregoing, whenever, pursuant to the provisions of Article IV of this
Certificate, the holders of any one or more series or class of Preferred Stock shall have the
right, voting separately as a series or together with holders of other such series, to elect
Directors at an annual or special meeting of stockholders, the election, term of office, filling of
vacancies and other features of such directorships shall be governed by the terms of this
Certificate and any certificate of designations applicable thereto.
4. Vacancies. Subject to the rights, if any, of the holders of any series or class of
Preferred Stock to elect Directors and to fill vacancies in the Board of Directors relating
thereto, any and all vacancies in the Board of Directors, however occurring, including, without
limitation, by reason of an increase in size of the Board of Directors, or the death, resignation,
disqualification or removal of a Director, shall be filled solely and exclusively by the
affirmative vote of a majority of the remaining Directors then in office, even if less than a
quorum of the Board of Directors, and not by the stockholders. Any Director appointed in
accordance with the preceding sentence shall hold office for the remainder of the full term of the
class of Directors in which the new directorship was created or the vacancy occurred and until such
Director’s successor shall have been duly elected and qualified or until his or her earlier
resignation, death or removal. Subject to the rights, if any, of the holders of any series or
class of Preferred Stock
to elect Directors, when the number of Directors is increased or decreased, the Board of
Directors shall, subject to Article VI.3 hereof, determine the class or classes to which the
increased or decreased number of Directors shall be apportioned; provided, however,
that no decrease in the number of Directors shall shorten the term of any incumbent Director. In
the event of a vacancy in the Board of Directors, the remaining Directors, except as otherwise
provided by law, shall exercise the powers of the full Board of Directors until the vacancy is
filled.
5. Removal. Subject to the rights, if any, of any series or class of Preferred Stock
to elect Directors and to remove any Director whom the holders of any such stock have the right to
elect, any Director (including persons elected by Directors to fill vacancies in the Board of
Directors) may be removed from office (i) only with cause and (ii) only by the affirmative vote of
the holders of 75% or more of the shares then entitled to vote at an election of Directors. At
least forty-five (45) days prior to any meeting of stockholders at which it is proposed that any
Director be removed from office, written notice of such proposed removal and the alleged grounds
thereof shall be sent to the Director whose removal will be considered at the meeting.
ARTICLE VII
LIMITATION OF LIABILITY
A Director of the Corporation shall not be personally liable to the Corporation or its
stockholders for monetary damages for breach of fiduciary duty as a Director, except for liability
(a) for any breach of the Director’s duty of loyalty to the Corporation or its stockholders, (b)
for acts or omissions not in good faith or which involve intentional misconduct or a knowing
violation of law, (c) under Section 174 of the DGCL or (d) for any transaction from which the
Director derived an improper personal benefit. If the DGCL is amended after the effective date of
this Certificate to authorize corporate action further eliminating or limiting the personal
liability of Directors, then the liability of a Director of the Corporation shall be eliminated or
limited to the fullest extent permitted by the DGCL, as so amended.
Any repeal or modification of this Article VII by either of (i) the stockholders of the
Corporation or (ii) an amendment to the DGCL, shall not adversely affect any right or protection
existing at the time of such repeal or modification with respect to any acts or omissions occurring
before such repeal or modification of a person serving as a Director at the time of such repeal or
modification.
1. Amendment by Directors. Except as otherwise provided by law, the By-laws of the
Corporation may be amended or repealed by the Board of Directors by the affirmative vote of a
majority of the Directors then in office.
2. Amendment by Stockholders. The By-laws of the Corporation may be amended or
repealed at any annual meeting of stockholders, or special meeting of stockholders called for such
purpose as provided in the By-laws, by the affirmative vote of at least 75% of the outstanding
shares entitled to vote on such amendment or repeal, voting together as a single class;
provided, however, that if the Board of Directors recommends that stockholders
approve such amendment or repeal at such meeting of stockholders, such amendment or repeal shall
only require the affirmative vote of the majority of the outstanding shares entitled to vote on
such amendment or repeal, voting together as a single class.
The Corporation reserves the right to amend or repeal this Certificate in the manner now or
hereafter prescribed by statute and this Certificate, and all rights conferred upon stockholders
herein are granted subject to this reservation. Effective from and after the Mandatory Conversion
Time, whenever any vote of the holders of voting stock is required to amend or repeal any provision
of this Certificate, and in addition to any other vote of holders of voting stock that is required
by this Certificate or by law, such amendment or repeal shall require the affirmative vote of the
majority of the outstanding shares entitled to vote on such amendment or repeal, and the
affirmative vote of the majority of the outstanding shares of each class entitled to vote thereon
as a class, at a duly constituted meeting of stockholders called expressly for such purpose;
provided, however, that the affirmative vote of not less than 75% of the
outstanding shares entitled to vote on such amendment or repeal, and the affirmative vote of not
less than 75% of the outstanding shares of each class entitled to vote thereon as a class, shall be
required to amend or repeal any provision of Article V, Article VI, Article VII, Article VIII or
Article IX of this Certificate.
