SECOND AMENDMENT TO AMENDED AND RESTATED VOTING AGREEMENT
SECOND
AMENDMENT TO AMENDED AND RESTATED VOTING AGREEMENT
THIS
SECOND AMENDMENT TO AMENDED AND RESTATED VOTING AGREEMENT (this
“Amendment”)
is
dated as of January 24, 2008 by and among Acura Pharmaceuticals, Inc. (f/k/a
Xxxxxx Drug Co., Inc.), a New York corporation (the "Company")
and
GCE Holdings LLC (the “Designating
Party”).
WHEREAS,
the
parties to this Amendment are parties to a certain Amended and Restated Voting
Agreement dated as of February 6, 2004 (the “Original
Agreement”);
WHEREAS,
the
parties to this Amendment are also parties to a certain Joinder and Amendment
to
Amended and Restated Voting Agreement dated as of November 9, 2005 (the
“First
Amendment,”),
which
amended the Original Agreement in certain respects;
WHEREAS,
the
Original Agreement, the First Amendment, and this Amendment are herein
collectively the “Agreement”;
WHEREAS,
capitalized terms used herein but not otherwise defined shall have the meanings
set forth in the Original Agreement as amended by the First
Amendment;
WHEREAS,
pursuant to the terms and conditions contained in the Original Agreement as
amended by the First Amendment, any term of the Original Agreement or the powers
granted thereunder may be amended only with the written consent of a majority
of
the Securities then subject to such agreement, which majority must include
the
Designating Party so long as it owns the Minimum Threshold; and
WHEREAS,
the
parties to this Amendment desire to further amend the Original Agreement to
(i)
reduce the number of person designated by the Designating Party for election
to
the board of directors of the Company from four (4) to three (3); and (ii)
increase the number of persons who shall be independent directors from two
(2)
to three (3).
NOW,
THEREFORE,
the
parties to this Amendment, who constitute a majority of the Securities then
subject to the Original Agreement, as amended, which majority includes the
Designating Party, hereby agree and consent as follows:
1.
Amendments.
Section
2 of the Original Agreement (as amended by the First Amendment) is hereby
deleted and the following is inserted in its place:
“2.
Election
of Director Nominees.
Commencing upon the Company's next upcoming meeting of shareholders, each Party
and GCE Holdings LLC (the "Designating
Party")
agree
as follows:
(a) |
Each
Party holding any of the Company’s securities (collectively, the
"Securities")
shall vote its Securities, and take or cause to be taken such other
actions, as may be required from time to time to (i) ensure that
the Board
of Directors consists of no more than seven (7) directors, and (ii)
elect
to the Board of Directors of the Company (A) three (3) persons designated
by the Designating Party, (B) one person who shall be the Chief Executive
Officer of the Company, and (C) three (3) persons who shall be independent
directors (as defined in Rule 4200(a)(15) of the National Association
of
Securities' Dealers Listing Standards, as may be modified or
supplemented) nominated
and elected to the Board of Directors by the then current directors.
Without limiting the generality of the foregoing, at each annual
meeting
of the shareholders of the Company, and at each special meeting of
the
shareholders of the Company called for the purpose of electing directors
of the Company, and at any time at which the shareholders of the
Company
have the right to elect directors of the Company, in each such event,
each
Party shall vote all Securities owned by them (or shall consent in
writing
in lieu of a meeting of shareholders of the Company), or take such
other
actions as shall be necessary, to elect the Designating Party's designees
as a director of the Company in accordance with the preceding provisions
of this Section 2(a);
|
(b) |
Each
Party shall take all actions necessary to remove forthwith the director
designated by the Designating Party when such removal is requested
for any
reason, with or without cause, by the Designating Party. In the case
of
the death, resignation or removal as herein provided of a Designating
Party's designee, each Party shall vote all Securities held by it
to elect
another person designated by the Designating Party pursuant to Section
2(a);
|
(c) |
Each
Party hereby agrees that it will not vote any of its Securities in
favor
of the removal of any director that shall have been designated by
the
Designating Party, unless the Designating Party shall have consented
to
such removal in writing;
|
In
the
event that any Party shall fail to vote the Securities held by it in accordance
with Section 2(a) and (b), such Party shall, upon such failure to so vote,
be
deemed immediately to have granted to the Designating Party, a proxy to vote
its
Securities solely for the election of the nominee of the Designating Party
or
the removal of director designated by the Designating Party. Such Party
acknowledges that each such proxy granted hereby, including any successive
proxy, if necessary, is being given to secure the performance of an obligation
hereunder, is coupled with an interest, and shall be irrevocable until such
obligation is performed;
(d) |
No
Party shall grant any proxy or enter into or agree to be bound by
any
voting trust with respect to the Securities held by such Party, or
enter
into any shareholder agreement or arrangement of any kind with any
person
with respect to the Securities held by such person that is, in either
case, inconsistent with the terms of this Agreement (whether or not
such
agreement and arrangement was or is with other shareholders of the
Company
that are or are not parties to this
Agreement);
|
2
(e) |
The
Company shall take, or cause to be taken, such actions as may be
required
from time to time to establish and maintain executive, audit and
compensation committees of the Board of Directors, as well as such
other
committees of the boards of directors of the Company as the Board
of
Directors shall determine, having such duties and responsibilities
as are
customary for such committees. The designees of the Designating Party
shall be, if so requested by the Designating Party, in its sole
discretion, a member of each such committee; and
|
(f) |
The
rights of the Designating Party shall terminate on the date the
Designating Party ceases to be a holder of at least 2,500,000 Share
Equivalents (“Minimum
Threshold”).
For purposes hereof, Share
Equivalents
means common stock of the Company and/or shares of common stock of
the
Company underlying warrants. Further, from and after the date the
Designated Party ceases to be a holder of at least 10,000,000 Shares
Equivalents, it shall only have the right to designate two (2) directors
pursuant to Section 2(a) above, with the forfeited seat becoming
a seat
for an independent director to thereafter be nominated and elected
to the
Board of Directors from time to time by the then current directors.
Finally, from and after the date the Designated Party ceases to be
a
holder of at least 5,000,000 Share Equivalents, it shall only have
the
right to designate one (1) director pursuant to Section 2(a) above,
with
the additional forfeited seat becoming a seat for an independent
director
to thereafter be nominated and elected to the Board of Directors
from time
to time by the then current
directors.”
|
2. Amendment.
Any
term of this Amendment or the powers granted hereunder may be amended and the
observance of any such term or power may be waived (either generally or in
a
particular instance and either retroactively or prospectively) only with the
written consent of a majority of the Securities then subject to this Agreement,
which majority must include the Designating Party so long as it owns the Minimum
Threshold.
3. Successors
and Assigns.
Except
as otherwise provided herein, this Amendment shall inure to the benefit of,
and
be binding upon and enforceable against, the parties to the Original Agreement
(as amended by the First Amendment) and their respective successors, assigns,
heirs, executors and administrators.
4. Counterparts.
This
Amendment may be executed in separate counterparts, including by facsimile,
each
of which shall be an original and all of which taken together shall constitute
one and the same agreement.
5. Notices.
For
purposes of Section
10
of the
Original Agreement, all notices, demands or other communications to the
Transferee shall be directed to the address set forth on the signature page
hereto.
6. Effect
of Amendment.
Except
as expressly provided herein, no other changes or modifications or waivers
or
consents to the Original Agreement (as amended by the First Amendment) are
intended or implied, and in all other respects the Original Agreement (as
amended by the First Amendment) is hereby ratified and confirmed by all parties
hereto as of the effective date hereof.
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7. Governing
Law.
This
Amendment and rights of the parties hereunder shall be governed in all respects
by the laws of the State of New York wherein the terms of this Amendment were
negotiated, excluding to the greatest extent permitted by law any rule of law
that would cause the application of the laws of any jurisdiction other than
the
State of New York.
[SIGNATURE
PAGE TO FOLLOW]
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IN
WITNESS WHEREOF,
the
parties hereto have executed this Second Amendment to Amended and Restated
Voting Agreement as of the date first above written.
By:
/s/ Xxxxxx X.
Xxxxxxx
Name:
Xxxxxx X. Xxxxxxx
Title:
President and Chief Executive Officer
GCE
HOLDINGS LLC
By: /s/
Xxxxx X.
Xxxxxx
Name:
Xxxxx X. Xxxxxx
Title:
Address:
c/o Xxxxx Partners III, L.P.
000
Xxxxx Xxxxxx, 0xx
Xxxxx
Xxx
Xxxx, Xxx Xxxx 00000
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