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Exhibit 10.20
AGREEMENT
This agreement supersedes the similar agreement dated September 15, 1995, and
is being entered into as of the 16th day of October, 1995, by and among
BioFactors, Inc., a Delaware Corporation (the "Company"), Xxxxxx Xxxxxx and
Xxxxxx Xxxxxxxxx, investors in BioFactors, Inc. and members of its Board of
Directors. In consideration of your waiving the present default on the
unsecured loans to you and your affiliates totaling $54,450 and $237,660 of
principal and $17,723.86 and $63,473.30 in accumulated interest as of June 30,
1995 for Xxxxxx Xxxxxx and Xxxxxx Xxxxxxxxx, respectively and for agreeing to
convert the principal amounts of such notes into Common Stock at the IPO and
for re-scheduling payment of all principal and accrued interest until the
earlier of the IPO or December 31, 1996 and, finally agreeing to leave
individually your last $10,000 investment in the existing Bridge (it being
agreed that no other Bridge Investor's notes will be prepaid at this time), and
to induce your continuing service as directors, we agree to the following:
1. Xxxxxx Xxxxxx and Xxxxxx Xxxxxxxxx will each receive 75,000 new
options with an exercise price of $2.50 per share or 125,000
options with an exercise price of $5.00 per share, whichever you
prefer. The option agreement shall contain a provision that the
options will be fully transferable. Half of these options are to
be vested and the remaining fifty percent shall vest in one year.
The option become fully vested if the optionee is requested to
resign as a member of the Board of Directors prior to the vesting
date, for other his own misconduct. The Company, Xxxxxx Xxxxxx
and Xxxxxxx Xxxxxxxxx will execute and deliver the Company's
standard form option agreement, with appropriate changes to
reflect the terms herein.
2. You both agree that the principal portion of your unsecured notes
shall, without the need for further action on your part, be
converted into Common Stock upon the closing of the Company's
initial underwritten public offering at the per share price in
the IPO. The shares will be subject to a lock-up period of 12
months and you agree to execute and deliver such form of lock-up
agreement as you may be requested by the underwriter. If the IPO
has not taken place by December 31, 1996, all outstanding
principal and accrued interest shall be payable on that date.
3. Interest on your unsecured debt shall be re-computed on an
annually compounded basis from inception and will be due on or
before the revised maturity date of the underlying debt.
4. You both agree to waive the current default on your unsecured
notes, which due dates were fifty percent on June 30, 1995 and
fifty percent on December 31, 1995.
5. We will transfer to you for no additional monetary consideration
all BFI's or Management's rights to invest in the sports entity
with the exception of any rights held by Xxxx Xxxxxxxxx, as to
which we cannot make a commitment, and one-half of the
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AGREEMENT
October 16, 1995
Page 2
Company's 7-1/2% warrants in the sports entity will be sold to
each of you for $1.00, it being agreed that such rights and
warrants have no determinable value at present.
6. As Directors you each will receive fees of $2,000 per month plus
reasonable out-of-pocket expenses in connection with your duties
as Board members.
PLEASE INDICATE YOUR PREFERENCE AS TO THE OPTIONS OFFERED HEREBY, BY INITIALING
NEXT TO YOUR CHOICE:
Xxxxxx Xxxxxx: X Option to purchase 75,000 shares of Common Stock at
--- an exercise price of $2.50 per share.
--- Option to purchase 125,000 shares of Common Stock at
an exercise price of $5.00 per share.
Xxxxxx Xxxxxxxxx: X Option to purchase 75,000 shares of Common Stock at
--- an exercise price of $2.50 per share.
--- Option to purchase 125,000 shares of Common Stock at
an exercise price of $5.00 per share.
If you are in agreement with the foregoing, please return a signed counterpart
copy of this letter to the undersigned by facsimile no later than 7:00 PM
(Mountain Time) today. Should you fail to do so, the foregoing offer is void..
AGREED TO: AGREED AND ACCEPTED:
BIOFACTORS, INC.
/s/ Xxxxxxx X. Xxxx /s/ Xxxxxx Xxxxxx (by fEGS)
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Xxxxxxx X. Xxxx Xxxxxx Xxxxxx
Executive Vice President & COO
October 16, 1995 10/16/95
-----------
Date
AGREED AND ACCEPTED:
/s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx
10/16/95
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Date
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AMENDMENT
This Amendment (this "Amendment") is entered into as of July
16, 1996, by and among BioFactors, Inc., a Delaware corporation (the
"Company"), Xxxxxx Xxxx, Xxxxxxx Xxxx, Xxxxxx Xxxxxx and Xxxxxx Xxxxxxxxx and
amends that certain Agreement (the "Agreement") dated October 16, 1995, by and
among the Company, Xxxxxx Xxxxxx and Xxxxxx Xxxxxxxxx (the "original parties").
A true and correct copy of the Agreement is attached hereto and made a part
hereof.
In consideration of the mutual promises contained herein, the
parties agree as follows:
1. Amendments. The original parties hereby agree to amend the
Agreement as follows:
a. Paragraph 1 of the Agreement is amended in its
entirety as
"1. The Company will grant to each of Xxxxxx Xxxxxx and
Xxxxxx Xxxxxxxxx 75,000 options with an exercise price of
$0.50 per share. The option agreements shall contain a
provision that the options will be fully transferable, which
in the case of the options granted to Xx. Xxxxxx have been
transferred. Half of these options shall vest immediately and
the remaining fifty percent shall vest on the earlier of one
year from the date of grant or the grantee's resignation from
the Company's Board of Directors for reasons other than his
own misconduct. The Company, Xxxxxx Xxxxxx and Xxxxxx
Xxxxxxxxx will execute and deliver the Company's standard form
option agreement with appropriate changes to reflect the terms
herein."
b. Paragraph 2 of the Agreement is amended in its
entirety as follows:
"2. The Parties hereby agree that the principal of the
Company's unsecured notes held by Xxxxxx Xxxxxxxxx (being
$247,660 principal amount) and by Walnut Capital, an affiliate
of Xxxxxx Xxxxxx (being $54,850 principal amount) (the
"Unsecured Debt") shall be paid in full from the proceeds of
the underwritten initial public offering of the Company's
common stock (the "IPO"). If the IPO has not taken place by
December 31, 1996, all outstanding principal and accrued
interest shall be payable on that date."
c. Paragraph 3 of the Agreement is amended in its
entirety as follows:
"3. Interest on the Unsecured Debt shall be recomputed on
an annually compounded basis from inception and shall be due
on the earlier of the consummation of the IPO or the revised
maturity date (being December 31, 1996)."
d. Paragraph 6 of the Agreement is amended in its
entirety as follows:
"6. As of October 16, 1996, Messrs. Kanter and Xxxxxxxxx
each will receive fees of $2,000 per month plus reasonable
out-of-pocket expenses in connection with their duties as
Directors of the Company, payment of which shall be deferred
until the earlier of a bridge financing placed by Xxxxxx
Xxxxxxx & Company LP or October 31, 1996; provided, that such
fees shall
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terminate immediately upon such Director's resignation from
the Board; further provided that as of July 16, 1996, such
fees shall terminate and after that date Xx. Xxxxxx shall be
compensated pursuant to the fee schedule established for
non-employee Directors, being $1,000 per Board meeting at
which personal attendance is required and $250 per telephonic
Board meeting or and committee meeting not part of, or
immediately preceding or following a scheduled board meeting,
which fee schedule shall take effect upon the consummation of
the IPO."
e. A new Paragraph 7 is added as follows:
"7. The Company will issue to each of Messrs. Kanter and
Xxxxxxxxx, 25,000 fully-paid, non- assessable shares of its
Common Stock as supplemental fees for their extraordinary
services as Directors of the Company during 1995."
f. A new Paragraph 8 is added as follows:
"8. Xxxxxx Xxxxxx and Xxxxxx Xxxxxxxxx each hereby agree
to lock up any shares of common stock of the Company,
including the shares of common stock of the Company issuable
upon the exercise of any options or warrants now or hereafter
held by them, for the period and pursuant to the other terms
and conditions set forth in the form of lock-up agreement
attached hereto and/or any future lock-up agreement in favor
of an alternate underwriter of the Company's securities (an
"Alternate Lock-up"), provided the duration of such Alternate
Lock-up is less than or equal to the duration of the form of
lock-up agreement attached hereto or such Alternate Lock-up
has been signed by at least 90% of the Company's other
stockholders, and to execute and deliver such form of lock-up
agreement concurrent with the execution of this Amendment.
Xxxxxx Xxxxxx and Xxxxxx Xxxxxxxxx each further agree to cause
each of their affiliates (in the case of Xxxxxx Xxxxxx, being
Walnut Capital Corporation and Antigua International Trust
Ltd. as Trustee for Three B Xxxxxx Trust, and in the case of
Xxxxxx Xxxxxxxxx, being W.S. Ventures) to agree to lock up any
shares of common stock of the Company now or hereafter owned
by such affiliates, including the shares of common stock of
the Company issuable to them upon the exercise of any options
or warrants now or hereafter held by them, for the period and
pursuant to the other terms and conditions set forth in the
form of lock-up agreement attached hereto and/or any future
lock-up agreement in favor of an alternate underwriter of the
Company's securities (an "Alternate Lock-up"), provided the
duration of such Alternate Lock-up is less than or equal to
the duration of the form of lock-up agreement attached hereto
or such Alternate Lock-up has been signed by at least 90% of
the Company's other stockholders, and to cause each such
affiliate to execute and deliver such form of lock-up
agreement concurrent with the execution of this Amendment
(collectively, together with the lock-ups being delivered by
Messrs. Kanter and Xxxxxxxxx , the "Lock-ups")."
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2. Release.
a. The Company, Xxxxxxx
Xxxx and Xxxxxx Xxxx for themselves and for their successors, representatives,
assigns, and agents, hereby completely, unconditionally, and forever release,
acquit and discharge Xxxxxx Xxxxxx and Xxxxxx Xxxxxxxxx, and their respective
heirs, successors, representatives, current and former employees, assigns and
agents, of and from any and all actions, causes of action, debts, claims,
demands, liabilities, losses, and damages of every kind and nature relating to
the Agreement and this Amendment. Notwithstanding the foregoing, nothing
contained herein shall constitute a release of Xxxxxx Xxxxxx or Xxxxxx
Xxxxxxxxx from the previous provisions of this Agreement.
x. Xxxxxx Kanter and
Xxxxxx Xxxxxxxxx for themselves and for their respective affiliates,
successors, representatives, assigns, and agents, hereby completely,
unconditionally, and forever release, acquit and discharge the Company, Xxxxxxx
Xxxx and Xxxxxx Xxxx, and their respective officers, directors, heirs,
successors, representatives, current and former employees, assign and agents,
of and from any and all actions, causes of action, debts, claims, demands,
liabilities, losses, and damages of every kind and nature relating to the
Agreement and this Amendment. Notwithstanding the foregoing, nothing contained
herein shall constitute a release of the Company, Xxxxxxx Xxxx and Xxxxxx Xxxx
from the provisions of this Agreement.
3. Resignation. Xxxxxx Xxxxxxxxx hereby agrees to tender his resignation
from the Company's Board of Directors concurrent with the execution of
this Amendment, which resignation shall be effective as of the date
hereof (the "Resignation").
4. Governing Law. The parties hereto agree that this agreement will be
construed and enforced in accordance with the laws of the State of
Colorado.
5. Construction of Waiver. The Agreement shall be deemed amended only to
the extent set forth herein and remains in full force and effect.
6. Counterparts. This Amendment may be executed in any number of
counterparts, by original or facsimile signature, each of which when so
executed and delivered shall be an original, but all of which together
shall constitute one and the same instrument.
7. Deadline. This Amendment shall be null and void unless fully executed
and, together with the Lock-ups and the Resignation, received in the
offices of the Company by 10:00 a.m. (mountain time) Tuesday, July 23,
1996.
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IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to Agreement to be duly executed as of the day and year first above
written.
BIOFACTORS, INC.
By:/s/ Xxxxxx Xxxx
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President and Chief Executive Officer
/s/ Xxxxxx Xxxxxx
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Xxxxxx Xxxxxx
/s/ Xxxxxx Xxxxxxxxx
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Xxxxxx Xxxxxxxxx
/s/ Xxxxxx Xxxx
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Xxxxxx Xxxx
/s/ Xxxxxxx Xxxx
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Xxxxxxx Xxxx
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