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EXHIBIT 10.20
STOCKHOLDER AGREEMENT
This Stockholder Agreement ("Agreement") dated as of June 21,
1996 is made by and between CardioVascular Dynamics, Inc., a Delaware
corporation ("CVD") and Endosonics Corporation, a Delaware corporation
("Endosonics").
WHEREAS, CVD is contemplating an underwritten public offering
of its Common Stock (the "IPO");
WHEREAS, Endosonics will own approximately 48.9% of the
outstanding Common Stock of CVD after the IPO;
WHEREAS, the IPO will benefit Endosonics and CVD, and the
prospective underwriters of the IPO have recommended that the likelihood of a
successful IPO will be enhanced by Endosonics and CVD entering into an
agreement defining certain aspects of Endosonics's relationship and rights with
respect to CVD;
NOW, THEREFORE, in consideration of the foregoing and for
other good and valuable consideration, the parties agree as follows:
1. Affiliates. For purposes of this Agreement, the term
"CVD" includes any subsidiary of CVD. For purposes of this Agreement, the term
"Endosonics" includes any Affiliate of Endosonics (other than CVD). The term
"Affiliate" means any person or entity that directly or indirectly through one
or more intermediaries, controls or is controlled by, or is under common
control with, Endosonics.
2. Agreements Between Endosonics and CVD. During the
period commencing upon the date that a registration statement relating to the
IPO is declared effective by the Securities and Exchange Commission through the
date of the termination of this Agreement ("Effective Period") the parties
agree that Endosonics and CVD shall not enter into any transaction, contract,
arrangement or agreement with each other unless such transaction, contract,
arrangement or agreement has been approved by the Committee, as hereinafter
defined. The Committee shall be a special committee of the Board of Directors
of CVD and shall consist of not less than two directors of CVD, each of whom is
not an officer, director, employee or Affiliate of Endosonics. The members of
the Committee shall initially be Xxxxxxxx Xxxx and Xxxxxx xxx Xxxxxxxx.
3. Cumulative Voting. During the Effective Period
Endosonics shall not approve, and shall vote against, any amendment to Article
III of CVD's Certificate of Incorporation (or any other existing or future
provisions involving cumulative voting) which would eliminate cumulative voting
for election of directors.
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4. Restrictions on Affiliates. Endosonics shall not
transfer any securities of CVD to an Affiliate, unless prior to the transfer
the transferee (i) agrees with CVD to be bound by the terms of this Agreement,
and (ii) sets forth such agreement in a writing reasonably satisfactory in form
and substance to CVD.
5. Term. This Agreement shall terminate upon the
earlier of June 21, 2003 or the date on which Endosonics beneficially owns
less than 25% of the outstanding Common Stock of CVD. Such beneficial
ownership shall be determined in accordance with the Securities Exchange Act of
1934, as amended, and the rules promulgated thereunder.
6. Successors. Except as specifically provided herein,
the terms and conditions of this Agreement shall inure to the benefit of and
shall be binding upon the respective successors and assigns of the parties.
7. Governing Law. This Agreement shall be governed by
and construed under the laws of the State of California as applied to
agreements among California residents entered into and to be performed entirely
within California.
8. Counterparts. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
9. Titles and Subtitles. The titles and subtitles used
in this Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.
10. Notices. Unless otherwise provided, any notice
required or permitted under this Agreement shall be given in writing and shall
be deemed effectively given upon personal delivery to the party to be noticed
or by delivery by nationally-recognized overnight courier to the party to be
notified or upon deposit with the United States Post Office, by registered or
certified mail, postage prepaid and addressed to the party to be notified at
the address indicated for such party on the signature page hereof, or at such
other address as such party may designate by ten (10) days' advance written
notice to the other parties.
11. Amendments and Waivers. Any term of this Agreement
may be amended and the observance of any term of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the parties hereto.
12. Severability. If one or more provisions of this
Agreement are held to be unenforceable under applicable law, such provision
shall be excluded from this Agreement and
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replaced with the enforceable provision closest in intent and economic effect
as the provision found to be unenforceable; provided however that no such
severability and replacement shall be effective if it materially changes the
economic benefit of this Agreement to any party hereto.
13. Entire Agreement. This Agreement constitutes the
full and entire understanding and agreement between the parties with regard to
the subjects hereof and thereof, and no party shall be liable or bound to any
other party in any manner by any warranties, representations or covenants
except as specifically set forth herein.
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IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date first written above.
ENDOSONICS CORPORATION
________________________________________
Name:
Title: Address:
CARDIOVASCULAR DYNAMICS, INC.
________________________________________
Name:
Title: Address:
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