EXHIBIT 4.2(A)
WAIVER AND AMENDMENT
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TO FIRST AMENDED INVESTORS' RIGHTS AGREEMENT
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THIS WAIVER AND AMENDMENT TO THE FIRST AMENDED INVESTORS' RIGHTS AGREEMENT
(the "Agreement") is made as of the 22nd day of January, 1998, by and among
Heska Corporation, a Delaware corporation (the "Company"), and Novartis Produkte
AG, Charter Ventures, Charter Ventures II, L.P. and Volendam Investeringen N.V.
(the "Holders"):
W I T N E S S E T H:
WHEREAS, the Company and the Holders are parties to that certain First
Amended Investors' Rights Agreement, dated as of April 12, 1996 (the "Investors'
Rights Agreement");
WHEREAS, the Company proposes to file a registration statement with the
Securities and Exchange Commission in order to register its securities in
connection with a firm commitment underwritten public offering of the Company's
Common Stock to be co-managed by Merrill Lynch & Co., Credit Suisse First Boston
Corporation and Hambrecht & Quist LLC (the "Offering"); and
WHEREAS, the Company proposes to enter into that certain Agreement and Plan
of Merger (the "Merger Agreement") by and among the Company, SDI Acquisition
Subsidiary, Inc., a Wisconsin corporation, and Sensor Devices, Inc., a Wisconsin
corporation, pursuant to which the New Investors (as defined in Section 2 below)
will receive shares of Common Stock of the Company;
WHEREAS, the Holders desire that the transactions contemplated by the Merger
Agreement be consummated, and, as a condition thereof and to induce such action,
the Holders are willing to enter into this Agreement to permit the New Investors
to become parties to the Investors' Rights Agreement, as set forth in Section 2
below.
In consideration of the foregoing and the promises and covenants contained
herein and other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereto agree as follows:
1. Waiver of Registration and Written Notice Rights. Pursuant to Section
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6.1 of the Investors' Rights Agreement, the Holders hereby consent, on behalf of
themselves and all other stockholders having rights under the Investors' Rights
Agreement, to waive the observance of, and their rights under, Section 2 of the
Investors' Rights Agreement, including, but not limited to the Holders' rights
to participate in up to 15% of the shares offered by the Company and rights to
receive written notice from the Company, with respect to the Offering for a
period commencing on the date hereof and continuing to a date 90 days after the
effective date of the Registration Statement filed with the Securities and
Exchange Commission with respect to the Common Stock to be sold in the Offering
(the "Effective Date"); provided, however, that the foregoing waiver shall
terminate if the Effective Date has not occurred on or before June 1, 1998.
2. Additional Parties to the Agreement. Schedule B to the Investors'
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Rights Agreement is hereby amended to include the beneficial owners of SDI
Common Stock (as defined in the Merger Agreement) as set forth on Schedule
2.1(d) to the Merger Agreement (but not including any beneficial owner who does
not receive any of the Merger Consideration (as defined in the Merger Agreement)
because of such owner's assertion of his or her dissenters' rights or
otherwise); provided, however, that such parties shall be added as parties to
the Investors' Rights Agreement only with respect to Section 2.3 and related
sections of the Investors' Rights Agreement and only with respect to fifty
percent (50%) of the Common Stock of the Company received by each such party as
a result of the Merger (as defined in the Merger Agreement) (the "New Investors'
Shares").
3. Amendments to Agreement. The New Investors are collectively referred to
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as "Holders" and the New Investors' Shares are collectively referred to as
"Registrable Securities" for purposes of the Investors' Rights Agreement.
4. Effectiveness. The waiver and amendment set forth in this Agreement
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shall be effective as of the date first above written, and, except as expressly
modified by this Agreement, the Investors' Rights Agreement, as originally
written and as subsequently amended, shall remain in full force and effect.
5. Counterparts. This Agreement may be executed in two or more
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counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. This Agreement will be
binding upon the Company and the Holders and their respective successors,
assigns, heirs and personal representatives.
6. Severability. If one or more provisions of this Agreement are held to
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be unenforceable under applicable law, such provision shall be excluded from
this Agreement and the balance of the Agreement shall be interpreted as if such
provision were so excluded and shall be enforceable in accordance with its
terms.
7. Entire Agreement. This Agreement, together with the Investors' Rights
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Agreement, constitutes the full and entire understanding and agreement between
the parties with regard to the subjects hereof and thereof.
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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.
HESKA CORPORATION
By: /s/ Fred M. Schwarzer
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Name: Fred M. Schwarzer
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Title President
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Address: 1825 Sharp Point Way
Fort Collins, Colorado 80525
HOLDERS:
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NOVARTIS PRODUKTE AG
By: /s/ H.B. Gurtler /s/ R. Muttenzer
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Name__________________________________________
Title_________________________________________
Address: P.O. Box
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CH-4002 Basel
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Switzerland
CHARTER VENTURES
By: /s/ A. Barr Dolan
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Name: A. Barr Dolan
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Title General Partner
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Address: 525 University Avenue
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Palo Alto, CA 94301
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CHARTER VENTURES II, L.P.
By: /s/ A. Barr Dolan
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Name A. Barr Dolan
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Title General Partner
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Address: 525 University Avenue
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Palo Alto, CA 94301
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VOLENDAM INVESTERINGEN N.V.
By: MeesPierson Trust (Curacao) N.V.
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Name: /s/ Anneke Soedhoe /s/Andries Kroon
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Title Managing Director
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Address: 14 J.B. Gorsiraweg
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Curacao, Netherlands Antilles
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COUNTERPART SIGNATURE PAGE TO
FIRST AMENDED INVESTORS' RIGHTS AGREEMENT
WHEREAS, Heska Corporation ("Heska") and the present Holders under the
First Amended Investors' Rights Agreements dated April 12, 1996, as amended, by
and among the Heska and the Holders, as defined therein (the "Investors' Rights
Agreement"), have agreed to the addition of certain former shareholders of
Sensor Devices, Inc. ("SDI") identified on Exhibit A hereto (the "SDI
Shareholders") as parties to the Investors' Rights Agreement, to the extent and
on the terms set forth below:
NOW, THEREFORE, each SDI Shareholder indicated on Exhibit A hereto shall be
deemed a party to the Investors' Rights Agreement; provided, however, that such
SDI Shareholder shall be deemed a party only with respect to Section 2.3 and
related sections of the Investors' Rights Agreement and only with respect to the
number of shares of Common Stock of Heska listed on Exhibit A hereto (the "New
Investor Shares"). Accordingly, each SDI Shareholder shall be deemed a
"Holder," and the New Investor Shares shall be deemed "Registrable Securities,"
for purposes of such Sections 2.3 and related sections of the Investors' Rights
Agreement.
IN WITNESS WHEREOF, the undersigned Shareholder Agent, designated as such
under that certain Agreement and Plan of Merger dated as of February 3, 1998 by
and among Heska, Red River Merger Subsidiary, Inc. and SDI, have executed this
Agreement on behalf of and for the benefit of the SDI Shareholders effective as
of March __, 1998.
SDI SHAREHOLDER AGENTS
/s/ Richard D. Pauls
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Richard D. Pauls
/s/ Steven D. Wiederholt
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Steven D. Wiederholt
HESKA CORPORATION
By /s/Fred M. Schwarzer
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Title: President
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