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Exhibit 10.24
AGREEMENT
Agreement dated as of May 8, 1996, between Fresenius AG, an
Aktiengesellschaft organized under the laws of the Federal Republic of Germany
("Fresenius AG"), and Fresenius USA, Inc., a Massachusetts corporation
("Fresenius USA").
RECITALS
WHEREAS, Fresenius AG and W. R. Grace & Co., a New York Corporation
("Grace") have entered into an Agreement and Plan of Reorganization, dated as of
February 4, 1996 (as amended, the "Reorganization Agreement"); and
WHEREAS, the Reorganization Agreement contemplates that Fresenius USA will
join in the Reorganization Agreement as a party and agree to be bound by the
terms of the Reorganization Agreement; and
WHEREAS, the board of directors of Fresenius USA and a special committee of
independent directors of Fresenius USA approved and ratified the Reorganization
Agreement and the other Transaction Agreements (as such term is defined in the
Reorganization Agreement) and, by letter agreement of even date herewith,
Fresenius USA has undertaken the obligations contained therein as a party and
desires to submit the Reorganization, including the Fresenius USA Merger (as
such terms are defined in the Reorganization Agreement) to a vote of its
stockholders; and
WHEREAS, Fresenius AG and Fresenius USA desire to set forth their agreement
with respect to certain matters under the Reorganization Agreement;
NOW, THEREFORE, the parties hereto agree as follows:
1. Any liquidated damages payable pursuant to Section 6.13 of the
Reorganization Agreement shall be payable $49.5 million to Fresenius AG and
$25.5 million to Fresenius USA. Fresenius AG and Fresenius USA agree that
if the Reorganization is not consummated, Fresenius AG and Fresenius USA
shall bear 66% and 34%, respectively, of the aggregate costs and expenses
of the Fresenius Parties, and shall make such payments between themselves
as may be necessary to effect such allocation.
2. (a) It is currently anticipated that 70,000,000 Newco Ordinary
Shares (the "Actual Anticipated Number of Outstanding Newco Shares") will
be outstanding immediately following the consummation of the
Reorganization, and it was previously anticipated that there would be
217,170,000 such shares (the "Previously Anticipated Number of Outstanding
Newco Shares") so outstanding, each on a fully diluted basis. The
Independent Committee of the Board of Directors of Fresenius USA (the
"Fresenius USA Independent Committee"), based on the Previously Anticipated
Number of Outstanding Newco Shares, acting upon advice from their advisors,
approved Fresenius USA Consideration Per Share equal to 1.15 Newco Ordinary
Shares as being fair to the holders (other than Fresenius AG, Grace and
their subsidiaries) of the common stock of Fresenius USA. Based on the
Actual Anticipated Number of Outstanding Newco Shares, the equivalent
Fresenius USA Consideration Per Share to be allocated among holders of
Fresenius USA Common Share Equivalents is equal to 0.37067735 Newco
Ordinary Shares, which shall also be the maximum number of Newco Ordinary
Shares issuable in respect of each Fresenius USA Common Share underlying
Fresenius USA Options assumed by or otherwise rolled over into Newco.
(b) Fresenius AG and Fresenius USA confirm that, prior to the
Fresenius USA Merger, Fresenius USA intends to repurchase (the
"Repurchase") certain vested and nonvested options held by employees of
Fresenius USA and certain other securities of Fresenius USA so that,
immediately prior to the Fresenius USA Merger, there shall be outstanding
no more than 9,253,331 Fresenius USA Common Share Equivalents (the
"Specified Maximum Number of Fresenius USA Common Share Equivalents"), and
that such repurchase shall be for a combination of cash and promissory
notes of Fresenius USA.
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Exhibit 10.24
(c) If the Specified Maximum Number of Fresenius USA Common Share
Equivalents were to be outstanding at the time of the Fresenius USA Merger,
the Aggregate Fresenius USA Common Share Consideration would be 4.9% of the
Newco Shares that will be outstanding immediately following the
consummation of the Reorganization on a fully diluted basis.
3. If there shall be in excess of the Specified Maximum Number of
Fresenius USA Common Share Equivalents outstanding immediately prior to the
effective time of the Fresenius USA Merger, the terms of paragraphs 1 and 2
hereof shall be automatically void and of no further force or effect,
without any action on the part of any party hereto.
4. Terms capitalized but not defined in this Agreement shall have the
meanings ascribed to them in the Reorganization Agreement.
5. This Agreement shall be governed by and construed in accordance
with the laws of the State of New York.
6. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be given (and shall be deemed to
have been duly given upon receipt) by delivery in person, by cable,
telegram, telex or other standard form of telecommunications, or by
registered or certified mail, postage prepaid, return receipt requested,
addressed as follows:
If to Fresenius AG:
As provided in the Reorganization Agreement; and
If to Fresenius USA:
Fresenius USA, Inc.
2637 Shadelands Drive
Walnut Creek, CA 94598
Attn.: Dr. Ben Lipps
Fax: (510) 988-1941
with copies to:
Ropes & Gray
One International Place
Boston, MA 02110-2624
Attn.: Winthrop G. Minot, Esq.
Fax: (617) 951-7050
7. This Agreement may be executed in several counterparts, each of
which shall be an original and all of which shall be deemed to be one and
the same agreement.
8. Nothing in this Agreement, expressed or implied, is intended to
confer upon any person or entity other than the parties hereto, any
benefit, right or remedies.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
FRESENIUS AG
By: /s/ GERD KRICK
------------------------------------
Name: Gerd Krick
Title: Chief Executive Officer
/s/ MATHIAS KLINGLER
------------------------------------
Name: Mathias Klingler
Title: President and Chief
Operating Officer --Dialysis
Systems Division
FRESENIUS USA, INC.
By: /s/ BEN LIPPS
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Name: Ben Lipps
Title: President
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