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EXHIBIT 10.8
THIS WARRANT AND THE SHARES ISSUABLE
HEREUNDER HAVE NOT BEEN REGISTERED UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR
ANY STATE SECURITIES LAWS, AND MAY
NOT BE SOLD, PLEDGED, OR OTHERWISE
TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION
THEREOF UNDER SUCH ACT AND LAWS OR, SUBJECT
TO SECTION 5.3 HEREOF, AN OPINION OF
COUNSEL REASONABLY SATISFACTORY TO THE
CORPORATION AND ITS COUNSEL, THAT SUCH
REGISTRATION IS NOT REQUIRED.
WARRANT TO PURCHASE STOCK
Issuer iRobot Corporation, a Delaware
corporation
Number of Shares 18,000, subject to
adjustment
Class of Stock Common Stock, $ 01 par value
per share
Exercise Price As set forth below
Issue Date January 30, 2003
Expiration Date January 29, 2010
FOR THE
AGREED UPON VALUE of $1.00, and for other good and valuable
consideration, the receipt and sufficiency
of which are hereby acknowledged,
this Warrant is issued to SILICON VALLEY
BANK (together with its successors and
permitted assigns, "Holder") by iRobot
Corporation, a Delaware corporation (the
"Company").
Subject to
the terms and conditions hereinafter set forth, the Holder is
entitled upon surrender of this Warrant and
the duly executed subscription form
annexed hereto as Appendix 1, at the office
of the Company, 63 South Avenue,
Burlington, Massachusetts 01803 or such
other office as the Company shall notify
the Holder of in writing, to purchase from
the Company up to Eighteen Thousand
(18,000) fully paid and non-assessable
shares (the "Shares") of the Company's
common stock, $ 01 par value per share
("Common Stock") at a purchase price per
Share equal to the Exercise Price (as
defined below). This Warrant may be
exercised in whole or in part at any time
and from time to time until 5.00 PM,
Eastern time, on the Expiration Date set
forth above, and shall be void
thereafter. Until such time as this Warrant
is exercised in full or expires, the
Exercise Price and the Shares are subject
to adjustment from time to time as
hereinafter provided.
As used
herein:
"Additional Common Shares" means all Common Stock (including
reissued
shares) Issued (or deemed to be issued
pursuant to Section 2.5(j)) after the
Issue Date. Additional Common Shares does
not include, however, any Common Stock
Issued in a transaction described in
Sections 2.1 and 2.2 below, any Common
Stock Issued upon conversion of Options
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and Convertible Securities outstanding as
of the Issue Date, the Shares, or
Options or Common Stock Issued pursuant to
a stock option plan approved by the
Board of Directors of the Company as an
incentive to, or in a nonfinancing
transaction to, employees, officers,
directors, or consultants to the Company.
"Convertible Securities" means any evidences of indebtedness,
shares of
stock, or other securities directly or
indirectly convertible into or
exchangeable for Common Stock.
"Exercise
Price" means either (a) $3.7415 (as adjusted from time to time
in accordance with the provisions hereof,
the "Prior Round Price"), or (b) if a
Qualified Financing occurs prior to June
30, 2003, from and after the
consummation of the Qualified Financing,
the lesser of (i) the Prior Round Price
and (ii) the Qualified Financing Price.
"Issue"
means to grant, issue, sell, assume, or fix a record date for
determining persons entitled to receive,
any security (including Options),
whichever of the foregoing is the first to
occur.
"Option"
means any right, option, or warrant to subscribe for, purchase,
or otherwise acquire Common Stock or
Convertible Securities.
"Qualified
Financing" means the first sale and issuance by the Company
after the Issue Date of this Warrant, in a
single transaction or series of
related transactions, of shares of its
convertible preferred stock or other
senior convertible equity securities to one
or more investors for financing
purposes resulting in gross proceeds to the
Company of at least $5,000,000.
"Qualified
Financing Price" means the lesser of (a) the lowest price per
share for which shares of Qualified
Financing Securities are sold or issued by
the Company in connection with the
Qualified Financing, and (b) if options,
warrants or other rights to purchase,
subscribe for or acquire Qualified
Financing Securities are sold or issued by
the Company in connection with the
Qualified Financing, the lowest exercise,
purchase, subscription or other
acquisition price payable to the Company
for one share of Qualified Financing
Securities under any such option, warrant
or other right to purchase, subscribe
for or otherwise acquire shares of
Qualified Financing Securities.
"Qualified
Financing Securities" means the class and/or series of
convertible preferred stock or other senior
equity security sold or issued by
the Company in the Qualified Financing.
ARTICLE 1. EXERCISE.
1.1. Method of Exercise. Holder may exercise this Warrant by
delivering a duly executed Notice of
Exercise in substantially the form attached
as Appendix 1 to the principal office of
the Company. Unless Holder is
exercising the conversion right set forth
in
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Section 1.2, Holder shall also deliver to
the Company a check for the aggregate
Exercise Price for the Shares being
purchased.
1.2. Conversion Right. In lieu of exercising this Warrant as
specified in Section 1.1, Holder may from
time to time convert this Warrant, in
whole or in part, into a number of Shares
determined as follows:
X = Y (A-B)/A
where
X = the number of Shares to be issued to the Holder
Y = the number of Shares with respect to which this
Warrant is being exercised
A = the Fair Market Value (as determined pursuant to
Section 1.3 below) of one Share
B = the Exercise Price
1.3. Fair Market Value.
1.3.1. If shares of Common Stock are traded on a nationally
recognized securities exchange or over the
counter market, the fair market value
of one Share shall be the closing price of
a share of Common Stock reported for
the business day immediately preceding the
date of Holder's Notice of Exercise
to the Company.
1.3.2. If shares of Common Stock are not traded on a
nationally recognized securities exchange
or over the counter market, the Board
of Directors of the Company shall determine
the fair market value of a share of
Common Stock in its reasonable good faith
judgment.
1.4. Delivery of Certrficate and New Warrant. Promptly after
Holder
exercises or converts this Warrant, the
Company shall deliver to Holder
certificates for the Shares acquired and,
if this Warrant has not been fully
exercised or converted and has not expired,
a new Warrant representing the right
to purchase the Shares not so acquired.
1.5. Replacement of Warrants. On receipt of evidence reasonably
satisfactory to the Company of the loss,
theft, destruction or mutilation of
this Warrant and, in the case of loss,
theft or destruction, on delivery of an
indemnity agreement reasonably satisfactory
in form and amount to the Company
or, in the case of mutilation, on surrender
and cancellation of this Warrant,
the Company at its expense shall execute
and deliver, in lieu of this Warrant, a
new warrant of like tenor.
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1.6. Assumption on Sale, Merger, or Consolidation of the
Company.
1.6.1. "Acquisition". For the purpose of this Warrant,
"Acquisition" means any sale, transfer,
exclusive license, or other disposition
of all or substantially all of the assets
of the Company, or any acquisition,
reorganization, consolidation or merger of
the Company where the holders of the
Company's outstanding voting equity
securities immediately prior to the
transaction beneficially own less than a
majority of the outstanding voting
equity securities of the surviving or
successor entity immediately following the
transaction.
1.6.2. In connection with, and upon the closing of, any
Acquisition (other than an Acquisition in
which the consideration received by
the Company's stockholders consists solely
of cash), and as a condition
precedent thereto, the successor or
surviving entity shall assume the
obligations of this Warrant, and this
Warrant thereafter shall be exercisable
for the same kind and amount of securities
and other property as would be
payable for the Shares issuable upon
exercise of the unexercised portion of this
Warrant as if such Shares were outstanding
on the record date for the
Acquisition and subsequent closing. The
Exercise Price shall be adjusted such
that the product of (i) the Exercise Price
in effect immediately prior to the
closing of such Acquisition, and (ii) the
number of Shares then issuable upon
exercise of this Warrant, equals the
product of (i) the number of shares or
other securities or property for which this
Warrant shall be exercisable
immediately following the closing of such
Acquisition, and (ii) the Exercise
Price in effect immediately following the
closing of such Acquisition, and the
Exercise Price and number and class of
Shares shall continue to be subject to
adjustment from time to time in accordance
with the provisions hereof.
ARTICLE 2. ADJUSTMENTS TO THE SHARES.
2.1. Stock Dividends, Splits, Etc. If the Company declares or pays
a
dividend on the outstanding shares of
Common Stock, payable in Common Stock or
other securities, or subdivides the
outstanding Common Stock into a greater
amount of Common Stock, then upon exercise
of this Warrant, for each Share
acquired, Holder shall receive, without
cost to Holder, the total number and
kind of securities to which Holder would
have been entitled had Holder owned the
Shares of record as of the date the
dividend or subdivision occurred.
2.2. Reclassification, Exchange or Substitution. Upon any
reclassification, exchange, substitution,
or other event that results in a
change of the number and/or class of the
securities issuable upon exercise or
conversion of this Warrant, Holder shall be
entitled to receive, upon exercise
or conversion of this Warrant, the number
and kind of securities and property
that Holder would have received for the
Shares if this Warrant had been
exercised immediately before such
reclassification, exchange, substitution, or
other event. The Company or its successor
shall promptly issue to Holder a new
Warrant for such new securities or other
property. The new Warrant shall provide
for adjustments which shall be as nearly
equivalent as may be practicable to the
adjustments provided for in this Article 2
including, without limitation,
adjustments to the Exercise Price and to
the number of securities or property
issuable upon
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exercise of the new Warrant. The provisions
of this Section 2.2 shall similarly
apply to successive reclassifications,
exchanges, substitutions, or other
events.
2.3. Adjustments for Combinations, Etc. If the outstanding shares
of
Common Stock are combined or consolidated,
by reclassification or otherwise,
into a lesser number of shares, the
Exercise Price shall be proportionately
increased and the number of Shares shall be
proportionately decreased.
2.4. No Impairment. The Company shall not, by amendment of its
Certificate of Incorporation or by-laws, or
through a reorganization, transfer
of assets, consolidation, merger,
dissolution, issue, or sale of securities or
any other voluntary action, avoid or seek
to avoid the observance or performance
of any of the terms to be observed or
performed under this Warrant by the
Company, but shall at all times in good
faith assist in carrying out of all the
provisions of this Article 2 and in taking
all such action as may be necessary
or appropriate to protect Holder's rights
under this Article against impairment.
2.5. Adjustments for Diluting Issuances.
(a)
Weighted Average Adjustment. If the Company issues Additional
Common
Shares after the Issue Date and the
consideration per Additional Common Share
(determined pursuant to subsection (i)
below) is less than the Exercise Price in
effect immediately before such Issue (a
"Diluting Issuance"), the Exercise Price
shall be reduced, concurrently with such
Issue, to a price (calculated to the
nearest hundredth of a cent) determined by
multiplying the Exercise Price by a
fraction.
(i) the numerator of which is the number of shares of Common
Stock
outstanding immediately before such Issue
plus the number of shares of Common
Stock that the aggregate consideration
received by the Company for the
Additional Common Shares would purchase at
the Exercise Price in effect
immediately before such Issue, and
(ii) the denominator of which is the number of shares of Common
Stock outstanding immediately before such
Issue plus the number of such
Additional Common Shares.
(b)
Adjustment to Number of Shares. Upon each adjustment of the
Exercise
Price, the number of Shares issuable upon
exercise of the Warrant shall be
increas
