EX-10.52 7 a2064502zex-10_52.txt EXHIBIT 10.52 EXHIBIT 10.52 CONSENT AND TERMINATION AGREEMENT dated as of November 7, 2001 (the "AGREEMENT"), by and among DONJOY, L.L.C., a Delaware limited liability company (the "COMPANY") and the members (and collectively, the "MEMBERS") of the Company. RECITALS WHEREAS, the Company and each of the Members are parties to a Members' Agreement, dated as of June 30, 1999 (the "MEMBERS' AGREEMENT"); WHEREAS, dj Orthopedics, Inc., a Delaware corporation (the "Parent") has filed a registration statement with the Securities and Exchange Commission pursuant to the Securities Act of 1933, as amended, relating to the initial public offering of shares of its common stock, $.01 par value per share (the "PARENT COMMON STOCK")(such offering, the "IPO"); WHEREAS, in order to facilitate the IPO, the Parent, DJ Acquisition Corporation, a Delaware corporation and wholly owned subsidiary of the Parent (the "MERGER SUBSIDIARY"), and the Company have entered into an Agreement and Plan of Merger, dated as of October 26, 2001 (the "FIRST MERGER AGREEMENT"), pursuant to which, immediately prior to the consummation of the IPO, the Merger Subsidiary will be merged with and into the Company, with the Company being the surviving entity (the "FIRST MERGER"); WHEREAS, in order to facilitate the IPO, the Parent and the Company have entered into an Agreement and Plan of Merger, dated as of November 7, 2001 (the "SECOND MERGER AGREEMENT", and together with the First Merger Agreements, the "MERGER AGREEMENTS"), pursuant to which, immediately after the consummation of the First Merger, but immediately prior to the consummation of the IPO, the Company will be merged with and into the Parent, with the Parent being the surviving entity (the "SECOND MERGER", and together with the First Merger, the "MERGERS"); WHEREAS, pursuant to the First Merger Agreement, the Members will receive shares of Parent Common Stock and the other consideration specified in the First Merger Agreement in exchange for the common units and preferred units of the Company held by the Members; and WHEREAS, in connection with the transactions contemplated by the First Merger Agreement and the IPO, the Company and the Members mutually and amicably wish to terminate the provisions of the Members' Agreement on the terms and conditions set forth herein. NOW, THEREFORE, in consideration of the mutual covenants and agreements contained in this Agreement, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows: 1. CONSENT TO THE MERGERS AND APPROVAL OF THE MERGER AGREEMENTS. Each of the Members hereby consents to the Mergers and hereby approves the form, terms and provisions of the Merger Agreements substantially in the forms attached hereto as EXHIBIT A. 2. TERMINATION OF MEMBERS' AGREEMENT. Effective upon the filing of the Certificate of Merger (as defined in the First Merger Agreement) pursuant to, and in accordance with, the terms of the First Merger Agreement, the Members' Agreement is hereby fully and finally terminated, and all rights and obligations of each of the parties thereunder shall terminate forever and be of no further force and effect. 3. ADOPTION OF REGISTRATION RIGHTS AGREEMENT. The agreement of the Members in SECTION 2 is conditioned upon the adoption by the Parent of the registration rights agreement in substantially the form attached hereto as EXHIBIT B. 4. ENTIRE AGREEMENT. This Agreement and the other writings referred to herein or therein or delivered pursuant hereto or thereto, contain the entire agreement among the Members and the Company with respect to the subject matter hereof and supersede all prior and contemporaneous arrangements or understandings with respect thereto. 5. GOVERNING LAW. This Agreement shall be governed by and construed in accordance with the domestic laws of the State of Delaware, without giving effect to any choice or conflict of law provision or rule (whether in the State of Delaware or any other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware. 6. BINDING. The terms and provisions of this Agreement shall be binding upon, and will inure to the benefit of, the parties hereto and their respective estates, heirs, personal representatives, successors and assigns. 7. COUNTERPARTS. This Agreement may be executed in any number of counterparts, and each such counterpart hereof shall be deemed to be an original instrument, but all such counterparts together shall constitute but one agreement. Facsimile counterpart signatures to this Agreement shall be acceptable and binding. [SIGNATURE PAGES TO FOLLOW] 2 IN WITNESS WHEREOF, the parties hereto have caused this Consent and Termination Agreement to be executed as of the date first written above. DONJOY, L.L.C. By: /s/ Leslie H. Cross -------------------------------------- Name: Leslie H. Cross Title: President & Chief Executive Officer J.P. MORGAN DJ PARTNERS, LLC BY: J.P. MORGAN FAIRFIELD PARTNERS, LLC, ITS MANAGING MEMBER By: /s/ Charles Orsatti ------------------------------------ Charles Orsatti Managing Member J.P. MORGAN PARTNERS (23A SBIC), LLC BY: J.P. MORGAN PARTNERS (23A SBIC MANAGER), INC., ITS MANAGING MEMBER By: /s/ Mitchell Blutt ------------------------------------ Name: Mitchell Blutt Title: Executive Partner IN WITNESS WHEREOF, the parties hereto have executed this Consent and Termination Agreement as of the date first above written. DJ INVESTMENT, LLC BY: FIRST UNION INVESTORS, INC., AS MANAGER By: /s/ David F. Grams, Jr. ------------------------------------ David F. Grams, Jr. Title: Principal FIRST UNION CAPITAL PARTNERS, LLC By: /s/ David F. Grams, Jr. ------------------------------------ David F. Grams, Jr. Principal IN WITNESS WHEREOF, the parties hereto have executed this Consent and Termination Agreement as of the date first above written. DJC, INC. By: /s/ Jean-Marc Chapus ---------------------------------- Name: Jean-Marc Chapus Title: President TCW/CRESCENT MEZZANINE TRUST II BY: TCW/CRESCENT MEZZANINE II, L.L.C., ITS INVESTMENT MANAGER BY: TCW/CRESCENT MEZZANINE, L.L.C., ITS MANAGING OWNER By: /s/ Jean-Marc Chapus ---------------------------------- Name: Jean-Marc Chapus Title: Managing Director TCW LEVERAGED INCOME TRUST II, L.P. BY: TCW (LINC II), L.P., ITS GENERAL PARTNER BY: TCW ADVISERS (BERMUDA), LTD., ITS GENERAL PARTNER By: /s/ Mark D. Senkpiel ---------------------------------- Name: Mark D. Senkpiel Title: Managing Director BY: TCW INVESTMENT MANAGEMENT CORPORATION, AS INVESTMENT ADVISER By: /s/ Jean-Marc Chapus ---------------------------------- Name: Jean-Marc Chapus Title: Managing Director IN WITNESS WHEREOF, the parties hereto have executed this Consent and Termination Agreement as of the date first above written. CRESCENT MACH I PARTNERS, L.P. BY: TCW ASSET MANAGEMENT CORPORATION, ITS INVESTMENT ADVISOR By: /s/ Jean-Marc Chapus ---------------------------------- Name: Jean-Marc Chapus Title: Managing Director By: /s/ Mark D. Senkpiel ---------------------------------- Name: Mark D. Senkpiel Title: Managing Director IN WITNESS WHEREOF, the parties hereto have executed this Consent and Termination Agreement as of the date first above written. LESLIE H. CROSS & DEBORAH L. CROSS FAMILY TRUST By: /s/ Leslie H. Cross ---------------------------------- Name: Leslie H. Cross Title: Co-Trustee /s/ Cyril Talbot III ------------------------------------- Cyril Talbot III /s/ Michael R. McBrayer ------------------------------------- Michael R. McBrayer