Common use of Board Observation Clause in Contracts

Board Observation. (a) Prior to a Qualified Public Offering, the following Holders shall have the right to have a representative attend all meetings of the Board of Directors (whether in person, by telephone or otherwise) in a non-voting observer capacity and shall be entitled to receive, concurrently with the members of the Board, and in the same manner, notice of such meeting and a copy of all materials, consents and resolutions provided to such members of the Board: (i) The Sprout Group, beginning on the date on which Sprout Capital IX, L.P. and its affiliates are not represented on the Board and ending on the date that Sprout Capital IX, L.P. and its affiliates owns less than 20% of the Series D Preferred Stock purchased by Sprout Capital IX, L.P. and its affiliates on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (ii) Perseus-Soros Biopharmaceutical Fund, L.P. ("PSBF"), beginning on the date on w▇▇▇▇ PSBF is not represented on the Board and ending on the date that PSBF owns less than 20% of the Series B Preferred Stock purchased by it on October 12, 2001 and the Series C Preferred Stock purchased by it on June 21, 2002 or Common Stock issuable upon conversion of such series of Preferred Stock; (iii) Orbimed Advisors, LLC, beginning on the date on which Caduceus Private Investments II, LP ("Caduceus") and its affiliates are not represented on the Board and ending on the date that Caduceus and its affiliates own less than 20% of the Series D Preferred Stock purchased by it on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (iv) BB Biotech ("BB"), or an affiliate thereof, until such time as BB and its affiliates own less than 20% of the Series D Preferred Stock purchased by BB on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (v) SCP Private Equity Partners II, L.P. ("SCP"), beginning on the date on which SCP is not represented on the Board and ending on the date that SCP and its affiliates own less than 1.0 million shares of the capital stock of the Company; (vi) Lehman Brothers Healthcare Venture Capital L.P. ("Lehman"), or an affil▇▇▇▇ ▇hereof, until such time as Lehman and its af▇▇▇▇▇▇es own less than 20% of the Series C Preferred S▇▇▇▇ ▇urchased by Lehman and its affiliates on June 21, 2002 or the Common Stock issuable ▇▇▇▇ conversion thereof; and (vii) Schroder Ventures Life Sciences Fund II LPI ("Schroders"), or an affili▇▇▇ ▇▇▇▇eof, until such time as Schroders and its affiliates own less than 20% of the Series C Preferred Stock purchased by Schroders and its affiliates on June 21, 2002 or the Common Stock issuable upon conversion thereof. (b) The Company shall hold meetings of the Board not less than quarterly. (c) After the date hereof the Company shall create a search committee to initiate a search for a President/Chief Operating Officer, which search committee shall include at least one director designated by the holders of a majority of the shares of Series D Preferred Stock.

Board Observation. (a) Prior to a Qualified Public Offering, the following Holders shall have the right to have a representative attend all meetings of the Board of Directors (whether in person, by telephone or otherwise) in a non-voting observer capacity and shall be entitled to receive, concurrently with the members of the Board, and in the same manner, notice of such meeting and a copy of all materials, consents and resolutions provided to such members of the Board: (i) The Sprout Group, beginning on the date on which Sprout Capital IX, L.P. and its affiliates are not represented on the Board and ending on the date that Sprout Capital IX, L.P. and its affiliates owns less than 20% of the Series D Preferred Stock purchased by Sprout Capital IX, L.P. and its affiliates on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (ii) Perseus-Soros Perseus-▇▇▇▇▇ Biopharmaceutical Fund, L.P. ("PSBF"), beginning on the date on w▇▇▇▇ which PSBF is not represented on the Board and ending on the date that PSBF owns less than 20% of the Series B Preferred Stock purchased by it on October 12, 2001 and the Series C Preferred Stock purchased by it on June 21, 2002 or Common Stock issuable upon conversion of such series of Preferred Stock; (iii) Orbimed Advisors, LLC, beginning on the date on which Caduceus Private Investments II, LP ("Caduceus") and its affiliates are not represented on the Board and ending on the date that Caduceus and its affiliates own less than 20% of the Series D Preferred Stock purchased by it on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (iv) BB Biotech ("BB"), or an affiliate thereof, until such time as BB and its affiliates own less than 20% of the Series D Preferred Stock purchased by BB on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (v) SCP Private Equity Partners II, L.P. ("SCP"), beginning on the date on which SCP is not represented on the Board and ending on the date that SCP and its affiliates own less than 1.0 million shares of the capital stock of the Company; (vi) Lehman ▇▇▇▇▇▇ Brothers Healthcare Venture Capital L.P. ("Lehman"), or an affil▇▇▇▇ ▇hereof, until such time as Lehman and its af▇▇▇▇▇▇es "), or an affiliate thereof, until such time as ▇▇▇▇▇▇ and its affiliates own less than 20% of the Series C Preferred SStock purchased by ▇▇▇▇▇▇ ▇urchased by Lehman and its affiliates on June 21, 2002 or the Common Stock issuable ▇▇▇▇ upon conversion thereof; and (vii) Schroder ▇▇▇▇▇▇▇▇ Ventures Life Sciences Fund II LPI ("Schroders"), or an affili▇▇▇ ▇▇▇▇eofaffiliate thereof, until such time as Schroders and its affiliates own less than 20% of the Series C Preferred Stock purchased by Schroders and its affiliates on June 21, 2002 or the Common Stock issuable upon conversion thereof. (b) The Company shall hold meetings of the Board not less than quarterly. (c) After the date hereof the Company shall create a search committee to initiate a search for a President/Chief Operating Officer, which search committee shall include at least one director designated by the holders of a majority of the shares of Series D Preferred Stock.

Board Observation. (a) Prior to a Qualified Public Offering, the following Holders shall have the right to have a representative attend all meetings of the Board of Directors (whether in person, by telephone or otherwise) in a non-voting observer capacity and shall be entitled to receive, concurrently with the members of the Board, and in the same manner, notice of such meeting and a copy of all materials, consents and resolutions provided to such members of the Board: (i) The Sprout Group, beginning on the date on which Sprout Capital IX, L.P. and its affiliates are not represented on the Board and ending on the date that Sprout Capital IX, L.P. and its affiliates owns less than 20% of the Series D Preferred Stock purchased by Sprout Capital IX, L.P. and its affiliates on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (ii) Perseus-Soros Perseus-▇▇▇▇▇ Biopharmaceutical Fund, L.P. ("“PSBF"”), beginning on the date on w▇▇▇▇ which PSBF is not represented on the Board and ending on the date that PSBF owns less than 20% of the Series B Preferred Stock purchased by it on October 12, 2001 and the Series C Preferred Stock purchased by it on June 21, 2002 or Common Stock issuable upon conversion of such series of Preferred Stock; (iii) Orbimed Advisors, LLC, beginning on the date on which Caduceus Private Investments II, LP ("“Caduceus"”) and its affiliates are not represented on the Board and ending on the date that Caduceus and its affiliates own less than 20% of the Series D Preferred Stock purchased by it on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (iv) BB Biotech ("“BB"”), or an affiliate thereof, until such time as BB and its affiliates own less than 20% of the Series D Preferred Stock purchased by BB on the date hereof or Common Stock issuable upon conversion of such series of Preferred Stock; (v) SCP Private Equity Partners II, L.P. ("“SCP"”), beginning on the date on which SCP is not represented on the Board and ending on the date that SCP and its affiliates own less than 1.0 million shares of the capital stock of the Company; (vi) Lehman ▇▇▇▇▇▇ Brothers Healthcare Venture Capital L.P. ("Lehman"), or an affil▇▇▇▇ ▇hereof, until such time as Lehman and its af“▇▇▇▇▇▇es ”), or an affiliate thereof, until such time as ▇▇▇▇▇▇ and its affiliates own less than 20% of the Series C Preferred SStock purchased by ▇▇▇▇▇▇ ▇urchased by Lehman and its affiliates on June 21, 2002 or the Common Stock issuable ▇▇▇▇ upon conversion thereof; and (vii) Schroder ▇▇▇▇▇▇▇▇ Ventures Life Sciences Fund II LPI ("“Schroders"”), or an affili▇▇▇ ▇▇▇▇eofaffiliate thereof, until such time as Schroders and its affiliates own less than 20% of the Series C Preferred Stock purchased by Schroders and its affiliates on June 21, 2002 or the Common Stock issuable upon conversion thereof. (b) The Company shall hold meetings of the Board not less than quarterly. (c) After the date hereof the Company shall create a search committee to initiate a search for a President/Chief Operating Officer, which search committee shall include at least one director designated by the holders of a majority of the shares of Series D Preferred Stock.