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EXHIBIT 10.14
TERMINATION AND MODIFICATION AGREEMENT
This Termination and Modification Agreement (the "Agreement") is made
and entered into this 30th day of September, 1996 by and among UroQuest
Corporation, a Florida corporation, including its successors and assigns (the
"Company"), Xxxxxxx X. Xxxxx, Xx., M.D. ("Xxxxx"), Warburg, Xxxxxx Investors,
L.P., a Delaware limited partnership ("Warburg"), and Vertical Fund Associates,
L.P., a Delaware limited partnership ("Vertical" and, together with Warburg, the
"Investors"), and shall be effective (except for the provisions of Sections 7, 8
and 9 hereof) only upon the closing of the Initial Public Offering (as defined
herein) of the Company.
RECITALS:
WHEREAS, the parties hereto have entered into that certain Securities
Purchase Agreement, dated as of June 15, 1995, a copy of which is attached
hereto as Exhibit A and by this reference incorporated herein (the "Purchase
Agreement"); and
WHEREAS, pursuant to the Purchase Agreement, the Company issued a
Warrant to Warburg, dated June 15, 1995, a copy of which is attached hereto as
Exhibit B and by this reference incorporated herein (the "Original Warrant");
and
WHEREAS, the Company has determined to file with the Securities and
Exchange Commission a Registration Statement on Form S-1 under the Securities
Act of 1933, as amended, with respect to a proposed initial public offering of
up to 3,350,000 share (but in no event less than 3,000,000 shares) of its
Common Stock, not including shares covered by the over-allotment option to be
granted to Xxxxxx, Read & Co. Inc. and Prudential Securities Incorporated, the
managing underwriters of the offering contemplated therein, with an initial
public offering price of between $7.00 and $11.00 per share (the "Initial Public
Offering"); and
WHEREAS, in connection with, and subject to the closing of, the Initial
Public Offering, the parties hereto desire to terminate their respective
interests under the Purchase Agreement and the Original Warrant, except as
specifically set forth herein.
AGREEMENT:
Now, therefore, upon these premises and in consideration of the
respective obligations and covenants contained herein, and for other good and
valuable consideration, the receipt and adequacy of which are hereby
acknowledged, the parties hereto agree as follows:
1. CONFIRMATION OF AGREEMENTS. The parties hereto hereby acknowledge,
confirm and agree that the Purchase Agreement and the Original Warrant shall
continue in full force and effect, subject to their respective terms and
conditions, until the Effective Time (as defined below).
2. TERMINATION OF AGREEMENTS. Effective as of the closing of the
Initial Public Offering (the "Effective Time"), the Purchase Agreement and the
Original Warrant (collectively, the "Agreements") are hereby terminated, and no
party thereto shall have any right, interest, duty or obligation with respect to
the Agreements.
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3. ISSUANCE AND EXERCISE OF WARRANTS. As of the Effective Time, the
Company shall issue to Warburg the warrant, to be dated the day of the Effective
Time, in the form attached hereto as Exhibit C and by this reference
incorporated herein (the "Warburg Replacement Warrant"), and Warburg shall
simultaneously exercise the Warburg Replacement Warrant in full, in accordance
with its terms and conditions. As of the Effective Time, the Company shall issue
to Vertical the warrant, to be dated the day of the Effective Time, in the form
attached hereto as Exhibit D and by this reference incorporated herein (the
"Vertical Replacement Warrant"), and Vertical shall simultaneously exercise the
Vertical Replacement Warrant in full, in accordance with its terms and
conditions.
4. SALE OF COMMON STOCK BY XXXXX. As of the Effective Time, Xxxxx shall
sell to Warburg, and Warburg shall purchase from Xxxxx, 257,143 (two hundred
fifty-seven thousand one hundred forty-three) shares of Common Stock for an
aggregate of $900 (Nine Hundred Dollars) in cash or other immediately
available funds. As of the Effective Time, Xxxxx shall sell to Vertical, and
Vertical shall purchase from Xxxxx, 28,571 (twenty-eight thousand five hundred
seventy-one) shares of Common Stock for an aggregate of $100 (One Hundred
Dollars) in cash or other immediately available funds.
5. AMENDMENT TO CO-SALE AGREEMENT. The parties hereto have entered into
that certain Right of First Refusal and Co-Sale Agreement dated as of June 15,
1995, a copy of which is attached hereto as Exhibit E and by this reference
incorporated herein (the "Co-Sale Agreement"). The parties hereto acknowledge
and agree that the Co-Sale Agreement shall be amended at the Effective Time
pursuant to the terms of the letter agreement attached hereto as Exhibit F and
by the reference incorporated herein (the "Amendment"). The parties hereto
affirm that the Co-Sale Agreement shall continue in full force and effect,
subject to its terms and conditions, as amended and modified by the Amendment.
6. AFFIRMATION OF CONTRACTS. The parties hereto hereby affirm that
nothing contained herein shall be deemed to modify or affect the terms and
conditions of the Option Agreement, dated June 15, 1996, among Warburg, the
Company and the holders of 12% Secured Promissory Notes (the "Option
Agreement"), the Second Amended and Restated Stockholders Agreement, dated May
31, 1995 and effective as of June 15, 1995, among the Company and the
Stockholders (as defined therein) (the "Stockholders Agreement"), or the
Registration Rights Agreement, dated June 15, 1995, among the Investors and the
Company (the "Rights Agreement"), and the Option Agreement, Stockholders
Agreement and Rights Agreement shall continue in full force and effect, subject
to their respective terms and conditions.
7. WARBURG RIGHT TO DESIGNATE DIRECTORS. Prior to the Effective Time,
so long as Warburg owns beneficially (within the meaning of Rule 13d-3 under the
Securities Exchange Act of 1934 (the "Exchange Act")) at least fifty percent
(50%) of the Common Stock (excluding shares of Common Stock issuable upon
exercise of the Original Warrant but including shares of Common Stock issuable
upon conversion of the Series D Preferred Stock) owned by it on the date hereof,
Warburg shall at any time be entitled to designate three (3) directors to the
Company's Board of Directors. On or after the Effective Time, so long as Warburg
owns beneficially (within the meaning of Rule 13d-3 under the Exchange Act) at
least fifty percent (50%) of the Common Stock (including shares of Common Stock
issuable upon exercise of the Warburg Replacement Warrant and including shares
of Common Stock issuable upon conversion of the Series D Preferred Stock) owned
by it at the Effective Time, Warburg shall at any time be entitled to designate
three (3) directors to the Company's Board of Directors
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8. VERTICAL RIGHT TO DESIGNATE DIRECTORS. Prior to the Effective Time,
so long as Vertical owns beneficially (within the meaning of Rule 13d-3 under
the Securities Exchange Act of 1934 (the "Exchange Act")) at least fifty percent
(50%) of the Common Stock (excluding shares of Common Stock that Vertical may
have rights to obtain upon exercise of the Original Warrant but including shares
of Common Stock issuable upon conversion of the Series D Preferred Stock) owned
by it on the date hereof, Vertical shall at any time be entitled to designate
three (3) directors to the Company's Board of Directors. On or after the
Effective Time, so long as Vertical owns beneficially (within the meaning of
Rule 13d-3 under Exchange Act) at least fifty percent (50%) of the Common Stock
(including shares of Common Stock issuable upon exercise of the Vertical
Replacement Warrant and including shares of Common Stock issuable upon
conversion of the Series D preferred Stock) owned by it at the Effective Time,
Vertical shall at any time be entitled to designate three (3) directors to the
Company's Board of Directors.
9. CHANGE IN NUMBER OF DIRECTORS. Notwithstanding anything contained in
the Articles of Incorporation or the Bylaws of the Company, each as amended to
date, the parties to this Agreement hereby agree that upon the request of
Warburg or Vertical to designate directors pursuant to the provisions set forth
in Sections 7 and 8 above, the parties hereto shall take all actions necessary,
including without limitation amending the Bylaws of the Company, to increase the
size of the Board of Directors so as to consist of not more than eleven (11)
members. Until such time as neither Warburg nor Vertical shall be entitled to
designate directors pursuant to this Agreement, the size of the Board of
Directors shall not be increased to a number greater than eleven (11) members
without the prior written consent of each of Warburg and Vertical.
10. STOCK SPLIT AND SHARE AMOUNTS. All share amounts contained herein
are expressed on a post-split basis assuming and giving effect to the Company's
proposed 1-for-3.5 reverse stock split (the "Reverse Split") of the outstanding
Common Stock and Preferred Stock of the Company to be effected in connection
with the Company's reincorporation in the State of Delaware. In the event the
Reverse Split is not effected prior to the Effective Time or is effected on a
basis other than as set forth above, the share amounts contained herein shall be
adjusted appropriately on an equitable basis.
11. NO CANCELLATION. Nothing contained in this Agreement shall be
deemed to cancel or void, ab initio, any prior performance under the Purchase
Agreement that has been fully executed.
12. GENERAL PROVISIONS
a. NOTICES. All communications under this Agreement shall be in
writing and shall be delivered by hand or mailed by overnight
courier or by registered mail or certified mail, postage prepaid:
(1) if to Warburg, at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx
00000, marked for attention of Xxxxxxxxx X. Xxxxxxxxxx, or at
such other address as Warburg may have furnished the Company in
writing,
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(2) if to Vertical, at 00 Xxxx Xxxxxx, Xxxxxx, Xxx Xxxxxx 00000,
marked for attention of Xxxx Xxxxxxxxx, or at such other address
as Vertical may have furnished the Company in writing,
(3) if to Xxxxx, at 00000 Xxxxxxx Xxxxxx, Xxxxx, Xxxxxxx 00000,
marked for attention of Xxxxxxx X. Xxxxx, Xx., M.D., or at such
other address as Xxxxx may have furnished the Company in
writing, or
(4) if to the Company, at 000 Xxxx 000 Xxxxx, Xxxx Xxxx Xxxx,
Xxxx 00000, marked for the attention of the President, or at
such other address as the Company may have furnished in writing
to the Investors.
b. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York applicable to
contracts made and to be performed entirely within such State.
c. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and assigns of each
of the parties.
d. ENTIRE AGREEMENT; AMENDMENT AND WAIVER. This Agreement and the
agreements or other instruments attached as Exhibits hereto
constitute the entire understanding of the parties hereto and
supersede all prior agreements or understandings with respect to
the subject matter hereof among such parties. This Agreement may be
amended, and the observance of any term of this Agreement may be
waived, with (and only with) the written consent of the Company,
Xxxxx and each of the Investors.
e. SEVERABILITY. If any provision of this Agreement be determined
by any court having jurisdiction to be unlawful or unenforceable,
such provision shall be deemed separate and apart from all other
provisions of this Agreement, and all remaining provisions of this
Agreement shall be fully enforceable.
f. LIMITATION ON ENFORCEMENT OF REMEDIES. The Company hereby agrees
that it will not assert against the limited partners of each of the
Investors any claim it may have under this Agreement by reason of
any failure or alleged failure by such Investor to meet its
obligations hereunder.
g. COUNTERPARTS. This Agreement may be executed in more than one
counterpart and by facsimile, each of which shall be deemed an
original and all of which together shall constitute one and the
same agreement.
UROQUEST CORPORATION
By: /s/ Xxxx X. Xxxx
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Xxxx X. Xxxx
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Name: XXXX X. XXXX
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Title: President
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XXXXXXX X. XXXXX, XX., M.D.
/s/ Xxxxxxx X. Xxxxx, Xx., M.D.
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WARBURG, XXXXXX INVESTORS, L.P.
By: Warburg, Xxxxxx & Co., General Partner
By: /s/ Xxxxxxxxx X. Xxxxxxxxxx
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Name: Xxxxxxxxx X. Xxxxxxxxxx
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Title: General Partner
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VERTICAL FUND ASSOCIATES, L.P.
By: The Vertical Group L.P., General Partner
By: /s/ Xxxx X. Xxxxxxxx
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Name: Xxxx X. Xxxxxxxx
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Title: General Partner
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