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EXHIBIT 10.2
TERMINATION OF
CREDIT AGREEMENT
AND
SECURITY AGREEMENT
This Termination of Credit Agreement and Security Agreement, each dated
August 12, 1998 by and between Xxxxxx Laboratories, an Illinois corporation
("Abbott"), and Micro Therapeutics, Inc., a Delaware corporation ("MTI"), is
dated this 21st day of May 1999.
RECITALS
A. MTI and Abbott entered into that certain Convertible Subordinated
Note Agreement, dated August 12, 1998, in which (i) MTI executed a 5%
Convertible Subordinated Note, due August 19, 2003 in the principal amount of $5
million, convertible into shares of the Common Stock of MTI (the "First Note"),
and (ii) Abbott and MTI entered into that certain Credit Agreement, dated August
12, 1998 (the "Credit Agreement"), in which Abbott agreed to loan, and has since
loaned, $5 million to MTI pursuant to a 5% Convertible Credit Facility Note
dated November 9, 1998, convertible into shares of the Common Stock of MTI (the
"Second Note" and with the First Note, the "Notes").
B. In connection with the execution and delivery of the First Note and
to secure the obligations of MTI to Abbott pursuant to the Credit Agreement, MTI
and Abbott executed a Security Agreement, dated August 12, 1998 (the "Security
Agreement").
X. Xxxxxx and MTI have agreed to cause the conversion of the Notes and
wish to terminate the Credit Agreement and the Security Agreement concurrent
with such conversion.
NOW, THEREFORE, the parties agree as follows:
1. TERMINATION OF CREDIT AGREEMENT AND SECURITY AGREEMENT. The Credit
Agreement and the Security Agreement shall hereby terminate and be of no force
or effect upon the conversion of the Notes including the receipt by Abbott of
the number of shares of Common Stock of MTI to which Abbott is entitled pursuant
to the Notes (the "Conversion Certificates").
2. EXECUTION AND FILING OF TERMINATION STATEMENT. Upon receipt of the
Conversion Certificates, Abbott shall execute and deliver to MTI for filing a
Termination Statement on Form UCC-2 for the purpose of terminating the filed
Financing Statement evidencing Xxxxxx'x security interest in certain assets of
MTI pursuant to the Credit Agreement.
3. CONVERSION. Abbott shall convert the First Note pursuant to a
delivery of a Notice of Conversion, a further copy of which is attached hereto,
and MTI shall convert the Second Note, pursuant to a Notice of Conversion, a
further copy of which is attached hereto.
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4. MTI REPRESENTATION AND COVENANT. MTI represents, warrants and
covenants to Abbott that (i) the transactions contemplated by the letter dated
April 30, 1999 (the "Letter"), from Xxxx X. Xxxxxx, Divisional Vice President,
Hospital Products Division of Abbott, addressed to Xxxxxx X. Xxxxxxx, Chief
Financial Officer of MTI, have been approved by the Board of Directors of MTI,
and (ii) in consideration of the conversion of the Notes, MTI will not cause
Abbott to purchase additional shares of MTI Common Stock contemplated by the
Letter (the "MTI Put") to the extent that the exercise of the MTI Put will cause
Abbott to become the record holder of more than 14.9% of the outstanding voting
stock of MTI, unless the purchase of such shares have been approved by the Board
of Directors of MTI prior to the date of such MTI Put for the purpose of Section
203 of the Delaware General Corporation Law, such that at the date of the MTI
Put, neither Abbott nor any of Xxxxxx'x affiliates will be subject to the
restrictions set forth in said Section 203 with respect to MTI. A certified copy
of the resolution or consent evidencing the approval called for above will be
provided to Abbott prior to MTI exercising the MTI Put, causing Abbott to become
the record holder of more than 14.9% of the outstanding voting stock of MTI.
5. EXECUTION IN COUNTERPARTS. This Agreement may be executed in multiple
counterparts, each of which shall be deemed to be an original and all of which
taken together shall constitute a single instrument.
IN WITNESS WHEREOF, MTI and Abbott have caused this Termination to be
executed by duly authorized officers of such corporations.
XXXXXX LABORATORIES,
an Illinois corporation
By: /s/ Xxxxxxx X. Xxxxxxxx
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Its: President HPO
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MICRO THERAPEUTICS, INC.,
a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxx
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Its: Chief Financial Officer
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