RALLY SOFTWARE DEVELOPMENT CORP. AMENDMENT NO. 1 TO FOURTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT

EX-10.1.1 6 a2214042zex-10_11.htm EX-10.1.1

Exhibit 10.1.1

RALLY SOFTWARE DEVELOPMENT CORP.
AMENDMENT NO. 1 TO FOURTH AMENDED AND RESTATED
INVESTOR RIGHTS AGREEMENT

THIS AMENDMENT NO. 1 TO FOURTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT (this “Amendment”) is entered into as of April 1, 2013 by and among RALLY SOFTWARE DEVELOPMENT CORP., a Delaware corporation (the “Company”), and the stockholders of the Company listed on listed on the signature pages hereto (the “Stockholders”).

W I T N E S S E T H:

WHEREAS, the Company and certain of its stockholders are parties to a Fourth Amended and Restated Investor Rights Agreement dated as of May 27, 2011 (the “Agreement”). Capitalized terms used but not defined herein shall have the meaning given thereto in the Agreement.

WHEREAS, Section 5.5(a) of the Agreement provides that, except as otherwise expressly provided in the Agreement, and subject to Sections 3.11 and 4.4 of the Agreement, the Agreement may be amended or modified, either prospectively or retrospectively and either in general or with respect to any particular matter, only upon the written consent of the Company and the holders of at least fifty-five percent (55%) of the Registrable Securities then outstanding.

WHEREAS, Section 3.11 of the Agreement provides that, among other things, the portion of such Section 3.11 related to the Meritech Observer Right may be amended, or any provision thereof waived, either prospectively or retrospectively, only with the prior written consent of Major Investors holding at least sixty percent (60%) of the shares of Series E Stock held by all Major Investors.

WHEREAS, Section 4.4(a) of the Agreement provides that, among other things, the preemptive rights established by Section 4 of the Agreement may be amended, or any provision waived, either prospectively or retrospectively, only with the prior written consent of Major Investors holding at least fifty-five percent (55%) of the Registrable Securities held by all Major Investors.

WHEREAS, the Corporation and the Stockholder, which Stockholder collectively constitute (a) the holders of at least fifty-five percent (55%) of the outstanding Registrable Securities, (b) Major Investors holders at least sixty percent (60%) of the shares of Series E Stock held by all Major Investors and (c) Major Investors holding at least fifty-five percent (55%) of the Registrable Securities held by all Major Investors, desire to amend the Agreement as provided herein.

AGREEMENT

NOW, THEREFORE, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree hereto as follows:

1. Section 3.15 of the Agreement is hereby amended and restated in its entirety to read as set forth below:

“3.15 Termination of Covenants. All covenants of the Company contained in Section 3 of this Agreement (other than the provisions of Section 3.3) shall expire and terminate as to each Investor upon the earlier of (i) the effective date of the registration statement pertaining to the Initial Offering, which results in the Preferred Stock being converted into Common Stock pursuant to the Company’s Amended and Restated Certificate of Incorporation, as the same may be amended from time to time, or (ii) the closing of an Acquisition or Asset Transfer (each as defined in the Company’s Amended and Restated Certificate of Incorporation, as in effect on the date hereof).”

2. The first sentence of Section 4.4(a) of the Agreement is hereby amended and restated in its entirety to read as set forth below:

“The preemptive rights established by this Section 4 shall not apply to, and shall terminate upon the earlier of (i) the Company’s first Qualified Public Offering (as such term is defined in the Company’s Amended and Restated Certificate of Incorporation, as the same may be amended from time to time) and (ii) the closing of an Acquisition or Asset Transfer (each as defined in the Company’s Amended and Restated Certificate of Incorporation, as in effect on the date hereof).”

3. This Amendment may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument.

4. This Amendment shall be governed by and construed under the laws of the State of Delaware in all respects as such laws are applied to agreements among Delaware residents entered into and to be performed entirely within Delaware.

5. Except as specifically amended by this Amendment, the terms and conditions of the Agreement shall remain unchanged and in full force and effect. In the event of any inconsistencies between this Amendment and the Agreement, the terms of this Amendment shall govern.

6. This Amendment shall become effective when executed and delivered by the Company and (a) the holders of at least fifty-five percent (55%) of the outstanding Registrable Securities, (b) Major Investors holders at least sixty percent (60%) of the shares of Series E Stock held by all Major Investors and (c) Major Investors holding at least fifty-five percent (55%) of the Registrable Securities held by all Major Investors. Upon such effectiveness, the terms of this Amendment shall be binding on each of the parties to the Agreement. The Stockholder consent to a restatement of the Agreement to incorporate this Amendment.

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IN WITNESS WHEREOF, the parties hereto have executed this AMENDMENT NO. 1 TO FOURTH AMENDED AND RESTATED INVESTOR RIGHTS AGREEMENT as of the date set forth in the first paragraph hereof.

	COMPANY:


	RALLY SOFTWARE DEVELOPMENT CORP.


	By:	/s/Timothy A. Miller
		Timothy A. Miller
		President and Chief Executive Officer