1
EXHIBIT 10.19
STOCK PURCHASE AGREEMENT
By and Between
ORGANON
TEKNIKA CORPORATION
and
PERIMMUNE HOLDINGS, INC.
2
STOCK PURCHASE AGREEMENT
This Stock Purchase Agreement (the "Agreement") is made as of this 1st day
of July, 1996 by and between Organon Teknika Corporation, a Delaware
corporation ("Shareholder"), and PerImmune Holdings, Inc., a Delaware
corporation ("Purchaser");
WITNESSETH
WHEREAS, Shareholder owns all of the issued and outstanding shares of the
capital stock of PerImmune, Inc., a Delaware corporation (the "Company");
WHEREAS, Shareholder desires to sell, and the Purchaser desires to
purchase, all of the issued and outstanding shares of the capital stock of the
Company pursuant to this Agreement; and
WHEREAS, in connection with the transactions contemplated herein,
Shareholder has agreed to transfer to the Company certain assets held in the
name of Shareholder or its Affiliates and currently used in the PerImmune
Business (as defined herein).
WHEREAS, in connection with transactions contemplated herein, the parties
intend for Shareholder and the Company to enter into certain agreements
governing the relationship between the Company and Shareholder and their
respective Affiliates (as defined herein) subsequent to the consummation of the
transactions contemplated herein.
NOW, THEREFORE, in consideration of the respective covenants and
representations and warranties contained herein, the parties hereto hereby
agree as follows:
1. DEFINITIONS
As used in this Agreement, the terms defined below shall have the
respective meanings hereinafter specified (such meanings to be equally
applicable to the singular and plural forms thereof).
"Action" means any action, suit, arbitration, proceeding or investigation
by or before any Governmental Authority.
"Affiliate" means, with respect to any entity, any other entity which
directly or indirectly controls, is controlled by, or is under common control
with such entity, where the term "control" means the ownership, directly or
indirectly, of more than fifty percent (50%) of the equity capital or the right
or power in fact to direct the management of such entity.
"Affiliated Group" means an affiliated group of corporations within the
meaning of Code Section 1504(a) or, for purposes of any state, local or foreign
Tax matters, any consolidated, combined, or unitary group of corporations
within the meaning of the corresponding provisions of tax law for the state or
other jurisdiction in question.
1
3
"Ancillary Agreements" means the Services Agreement and the Letter
Agreement.
"ANRP" has the meaning set forth in Section 6.8 of the Agreement.
"Bank Accounts" means all bank and similar accounts, lock boxes and safe
deposit boxes holding cash generated by the Company ordinarily used in
connection with the PerImmune Business.
"Cessation Date" has the meaning set forth in Section 6.8 of the Agreement.
"Claim" has the meaning set forth in Section 9.4(d) of the Agreement.
"Claim Notice" has the meaning set forth in Section 9.4(d) of the
Agreement.
"Closing" has the meaning set forth in Section 3.1 of the Agreement.
"Closing Agreements" means the Credit Facility, the Working Capital
Facility, the Intellectual Property Security Agreement, the Fixed Asset
Security Agreement and the Ancillary Agreements.
"Closing Balance Sheet" means the balance sheet of the Company as of June
30, 1996 attached hereto as Exhibit G.
"Closing Book Value" means an amount equal to $9,234,935.
"Closing Date" has the meaning set forth in Section 3.1 of this Agreement.
"COBRA continuation coverage" has the meaning set forth in Section 6.8 of
the Agreement.
"Code" means the Internal Revenue Code of 1986, as amended. All citations
to the Code or to the regulations promulgated thereunder shall include any
amendments or any substitute or successor provisions thereto.
"Continuation Period" has the meaning set forth in Section 6.8 of the
Agreement.
Continuation Plans" has the meaning set forth in Section 6.8 of the
Agreement.
"CPR" has the meaning set forth in Section 10.11 of the Agreement.
"Credit Facility" has the meaning set forth in Section 6.10 of the
Agreement.
"Damages" has the meaning set forth in Section 9.4(a) of the Agreement.
"Effective Date" means July 1, 1996.
2
4
"Employee Plan" means any plan, program, agreement, policy or arrangement
(a "plan") maintained or contributed to by Shareholder, the Company or any
ERISA Affiliate, or any successor thereto, whether or not reduced to writing,
for the benefit of, or pursuant to which the Company, or any Successor thereto,
has any liability with respect to, current or former employees, that is (i) an
"employee benefit plan" (within the meaning of Section 3(3) of ERISA), or (ii)
any other benefit arrangement providing for pension or retirement benefits,
profit sharing, deferred compensation, severance pay, medical, dental,
hospitalization, disability benefits, death benefits, life insurance, stock
bonus, stock purchase, stock option, restricted stock, stock appreciation
rights, fringe benefits, or similar benefits, including, without limitation,
the Akzo Nobel, Inc., Incentive Savings Plan (401k).
"Encumbrance" means any claim, lien, pledge, option, charge, easement,
security interest, deed of trust, mortgage, right-of-way, encroachment,
building or use restriction, conditional sales agreement, encumbrance or
other right of third parties, whether voluntarily incurred or arising by
operation of law, and includes, without limitation, any agreement to give any
of the foregoing in the future, and any contingent sale or other title
retention agreement or lease in the nature thereof.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"ERISA Pension Plan" has the meaning set forth in Section 4.7.
"ERISA Affiliates" means any entity which is (or at any relevant time was)
a member of a "controlled group of corporations" with, under "common control"
with, or a member of an "affiliated service group" with, the Company as
defined in Section 414(b), (c), (m) or (o) of the Code.
"Excluded Liability" means any liability arising out of DCAA audits of
periods ending on or prior to December 31, 1994.
"Fixed Asset Security Agreement" means the Fixed Asset Security Agreement
by and between the Company and Shareholder substantially in the form attached
hereto at Exhibit F.
"GAAP" means United States generally accepted accounting principles
applied consistently with the principles used to prepare the historical
financial statement of the Company.
"Government Contracts" shall mean any bid, quotation, proposal, contract,
agreement, work authorization, lease, commitment or sale or purchase order of
the Company that is with the United States Government, or any state, local or
foreign government, including, among other things, all contracts and work
authorizations to supply goods and services to the United States Government.
"Governmental Authority" means any government or political subdivision or
department thereof, any governmental or regulatory body, commission, board,
bureau, agency or instrumentality, or any court, in each case whether domestic
or foreign, federal, state or local.
3
5
"Indemnitees" has the meaning set forth in Section 9.4(b) of the Agreement.
"Intellectual Property Agreement" means the Intellectual Property
Agreement by and between Purchaser and Akzo Nobel Pharma International, B.V.
substantially in the form attached hereto as Exhibit B.
"Intellectual Property Security Agreement" means the Intellectual Property
Security Agreement by and between Purchaser, the Company, Akzo Nobel Pharma
International, B.V. and Shareholder substantially in the form attached hereto
as Exhibit E.
"Intercompany Accounts Payment" has the meaning set forth in Section 6.11
of the Agreement.
"ISP" has the meaning set forth in Section 6.8 of the Agreement.
"Law" means any domestic or foreign, federal, state or local statute, law,
ordinance, rule or regulation.
"Letter Agreement" means the Letter Agreement by and between the Company
and Shareholder substantially in the form attached hereto as Exhibit C.
"Order" means any judgment, order, writ, injunction, decree, stipulation
or award entered or rendered by any Governmental Authority.
"Owned Assets" means all assets, interests and rights of any kind, whether
tangible or intangible, real or personal, owned by the Company prior to the
transfer of the Transferred Assets to the Company pursuant to this Agreement.
"Parent" has the meaning set forth in Section 4.8(c) of the Agreement.
"Parent Affiliated Group" has the meaning set forth in Section 4.8(d).
"Pension Plan" has the meaning set forth in Section 6.8.
"PerImmune Books and Records" means (a) all records and lists of the
Company pertaining to the PerImmune Business as it was conducted by the Company
prior to the Closing, (b) all records and lists of the Company pertaining to
the PerImmune Business, customers, suppliers, personnel of the Company as of
the Closing and (c) all books, ledgers, files, reports, plans, drawings and
operating records of every kind maintained by the Company and pertaining to the
PerImmune Business as it was conducted by the Company prior to the Closing.
"PerImmune Business" means the business of research, development and the
commercialization of clinical and therapeutic applications for vaccine-based
active specific immunotherapy and the research, development, clinical and
therapeutic application and manufacturing of human monoclonal antibodies,
non-specific immunotherapy and in-vitro diagnostics, as well as contract
research and product sales, as currently conducted and proposed to be conducted
by the Company.
4
6
"Permitted Encumbrances" means (i) materialmen's, mechanics',
carriers', workmen's, repairmen's or other like liens arising in the ordinary
course of Shareholder's or the Company's business for amounts not yet due or
which are being contested in good faith by appropriate proceedings as to which
adequate reserves have been established; and (ii) liens for current taxes not
yet due or any taxes being contested in good faith by appropriate proceedings
as to which adequate reserves have been established.
"PerImmune Liabilities" means (i) all liabilities reflected on the
Closing Balance Sheet and (ii) all liabilities arising from the conduct of the
PerImmune Business by the Company on or after December 31, 1994 but not
including any Excluded Liability.
"Post-Closing Partial Period" has the meaning set forth in Section
9.5(a) of the Agreement.
"Pre-Closing Partial Record" has the meaning set forth in Section
9.5(a) of the Agreement.
"Purchase Price" has the meaning set forth in Section 2.1 of the
Agreement.
"Purchase Price Allocation Schedule" has the meaning set forth in
Section 9.5(e) of the Agreement.
"Purchase Price Note" has the meaning set forth in Section 2.2(a) of
the Agreement.
"Purchaser" means PerImmune Holdings, Inc.
"Purchaser Indemnitees" has the meaning set forth in Section 9.4(a)
of the Agreement.
"Returns" means all returns, declarations, reports, statements, and
other documents required to be filed in respect of Taxes by or with respect to
the Company or any Affiliated Group that includes the Company, and the term
"Return" means any one of the foregoing Returns.
"Services Agreement" means the Services Agreement by and between the
Company and Shareholder substantially in the form attached hereto as Exhibit D.
"Settlement Dividend" has the meaning set forth in Section 6.11.
"Shareholder" means Organon Teknika Corporation.
"Shareholder Indemnitees" has the meaning set forth in Section 9.4(b)
of the Agreement.
5
7
"Shareholder's Books and Records" means all records and lists of
Shareholder and its respective Affiliates relevant to the PerImmune Business as
it was conducted prior to the Closing, (b) all records and lists of
Shareholders and its respective Affiliates relevant to the PerImmune Business,
customers, suppliers, personnel of such persons and (c) all books, ledgers,
files, reports, plans, drawings and operating records of every kind maintained
by Shareholder and its respective Affiliates relevant to the PerImmune Business
as it was conducted prior to the Closing.
"Shares" has the meaning set forth in Section 2.1 of the Agreement.
"Taxes" means all federal, state, local, foreign, and other net
income, gross income, gross receipts, sales, use, ad valorem, transfer,
franchise, profits, license, lease, service, service use, withholding, payroll,
employment, excise, severance, stamp, occupation, premium, property, windfall
profits, customs, duties or other taxes, fees, assessments, or charges of any
kind whatever, together with any interest and any penalties, additions to tax,
or additional amounts with respect thereto, and the term "Tax" means any one of
the foregoing Taxes.
"Third Party Notice" has the meaning set forth in Section 9.4(d) of
the Agreement.
"Transferred Assets" means all assets, interests and rights of any
kind, whether tangible or intangible, real or personal, held by Shareholder or
any Affiliate of Shareholder which are used exclusively in or for the benefit
of the PerImmune Business, excluding the Owned Assets, but including, without
limitation:
(a) Shareholder's rights, title and interest in and under the License
Agreement (Lipoprotein (a) Immunoassay) dated as of July 24, 1994 by and
between Arch Development Corporation and Organon Teknika Corporation;
(b) all claims, causes of action, claim in action, rights of recovery
and rights of set off of any kind, including without limitation, any liens
or any rights to payment or to enforce payment in connection with any
transaction on or prior to the Closing Date, to the extent arising from or
relating to the PerImmune Business; and
(c) rights under insurance policies and programs covering risks
pertaining to the PerImmune Business with respect to occurrences or claims
arising on or prior to the Closing Date.
"Working Capital Facility" has the meaning set forth in Section
6.11(b) of the Agreement.
6
8
2. PURCHASE AND SALE
2.1. Purchase and Sale of Stock. Subject to and upon the terms and
conditions contained herein, Shareholder agrees to sell, assign, transfer and
convey at the Closing to Purchaser, and Purchaser agrees to purchase at the
Closing from Shareholder, all of the issued and outstanding shares of the
capital stock of the Company (the "Shares"). The total purchase price (the
"Purchase Price") that Purchaser shall pay to Shareholder for the Shares is
equal to the Closing Book Value.
2.2. Payment of Purchase Price. On the Closing Date, Purchaser will
deliver to Shareholder in payment of the Purchase Price a promissory note which
shall have a maturity of two years from the Closing Date, subject to prepayment
as set forth therein. Such promissory note shall accrue interest from the
Closing Date at a fixed rate per annum equal to eight percent (8%) (which
interest shall be added to the principal balance semi-annually and thereafter
shall accrue interest at the stated rate) and shall have such other terms as
set forth in Exhibit A (the "Purchase Price Note").
3. CLOSING
3.1. Closing. Subject to the terms and conditions of this Agreement, the
purchase and sale of the Shares (the "Closing") shall take place at 10:00 a.m.
on the date five (5) business days following the date on which the conditions to
the Closing set forth in Articles 7 and 8 of this Agreement have been fulfilled
or waived and either Purchaser, on the one hand, or Shareholder, on the other
hand, shall have notified the other party of such fulfillment or waiver, or on
such other date as may be agreed to by Purchaser and Shareholder (the "Closing
Date") at the offices of Xxxxxx & Xxxxxxx, 1001 Pennsylvania Avenue, N.W., 13th
Floor, Washington, D.C. or at such other place as may be agreed to by Purchaser
and Shareholder.
3.2. Deliveries by Shareholder at Closing.
At Closing, Shareholder shall deliver or cause to be delivered:
(a) to Purchaser, all certificates representing the Shares, duly
endorsed for transfer or accompanied by instruments of transfer reasonably
satisfactory in form and substance to Purchaser;
(b) to Purchaser, certified copies of resolutions of the board of
directors of Shareholder authorizing Shareholder to enter into and perform
its obligations under this Agreement;
(c) to Purchaser, evidence of the resignations described in Section
6.7;
(d) to Purchaser, all corporate minute books and stock records for
the Company;
7
9
(e) to the Company, all documents, certificates or instruments as
are necessary to effect the transfer of the Transferred Assets to the
Company;
(f) to the Company, such documents as are necessary to transfer to
persons designated by Purchaser, authorization to draw from, and have
access to, the Bank Accounts in the name of PerImmune, and
(g) all such other documents and instruments as Purchaser or its
counsel shall reasonably request to consummate or evidence the
transactions contemplated hereby.
3.3 Deliveries by Purchaser at Closing
At Closing, Purchaser shall deliver to Shareholder:
(a) the Purchase Price Note;
(b) certified copies of resolutions of the board of directors of
Purchaser authorizing Purchaser to enter into and perform its obligations
under this Agreement; and
(c) all such other documents and instruments as Shareholder or its
counsel shall reasonably request to consummate or evidence the
transactions contemplated hereby.
3.4. Certificates. At Closing, Purchaser and Shareholder shall deliver the
certificates and other documents described in Section 7.3 and 8.3.
3.5 Consents. At Closing, Shareholder shall deliver all government
authorizations and other third party consents identified on Schedule 4.4.
3.6 Ancillary Agreements. At Closing, Shareholder and the Company shall
enter into the Ancillary Agreements.
3.7 Credit Facility; Working Capital Facility. At Closing, the Company
and Shareholder shall enter into the Credit Facility and the Working Capital
Facility as contemplated in Section 6.10 and Section 6.11, respectively.
3.8 Form of Document and Instruments. All of the documents and
instruments delivered at Closing shall be in form and substance, and shall be
executed and delivered in a manner, reasonably satisfactory to the parties'
respective counsel.
3.9 Tax Form. At Closing, Purchaser shall, and Shareholder shall cause
Parent to, execute a Form 8023-A -- "Corporate Qualified Stock Purchases."
8
10
4. REPRESENTATIONS AND WARRANTIES OF SHAREHOLDER
Shareholder represents and warrants to Purchaser that:
4.1 Organization
(a) Shareholder is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, and has all
requisite power and authority to own, lease and operate its properties, to
carry on its business as it is now being conducted and to enter into this
Agreement and the Closing Agreements to which it is a party and perform
its obligations thereunder.
(b) The Company is a corporation duly organized, validly existing
and in good standing under the laws of the State of Delaware, has all
requisite power and authority to own, lease and operate its properties,
to carry on its business as it is now being conducted and to enter into
this Agreement and Closing Agreements to which it is a party and perform
its obligations thereunder, and is duly qualified to do business in each
jurisdiction in which the nature of the business conducted by it or the
ownership or leasing of its properties makes such qualification necessary.
4.2. Capitalization of the Company.
(a) Schedule 4.2 sets forth the number of authorized, issued and
outstanding shares of capital stock of the Company. All of the issued and
outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and nonassessable, were
not issued in violation of any law or of the preemptive rights of any
stockholder, and are owned beneficially and of record by Shareholder free
and clear of any Encumbrance, except or Permitted Encumbrances.
(b) There are no outstanding subscriptions, options, warrants,
rights, convertible securities, calls, commitments, or agreements to
purchase, issue or sell capital stock or other securities of the Company
other than as contemplated by this Agreement.
4.3 Authorization. Shareholder has all necessary corporate power and
authority to execute and deliver this Agreement and the Closing Agreements to
which it is a party and to perform its obligations hereunder and thereunder and
to consummate the transactions contemplated hereby and thereby. The execution,
delivery and performance by Shareholder of this Agreement and the Closing
Agreements to which it is a party have been duly authorized by the board of
directors of Shareholder. This Agreement has been duly executed and delivered by
Shareholder and, on the Closing Date, the Closing Agreements to which it is a
party will have been duly executed and delivered by Shareholder, and do not
require any approval of the stockholders of Shareholder. This Agreement
constitutes, and on the Closing Date, each Closing Agreement to which
Shareholder is a party will constitute, the legal, valid and binding obligation
of Shareholder enforceable against Shareholder in accordance with its terms,
except as enforceability may be limited by bankruptcy, insolvency,
reorganization, moratorium or similar
9
11
laws affecting the rights and remedies of creditors generally and general
principles of equity, regardless of whether applied in equity or at law.
4.4. No Conflict; Approvals. Except as set forth on Schedule 4.4 hereto,
the execution, delivery and performance by Shareholder of this Agreement and
the Closing Agreements to which Shareholder is a party and the consummation of
the transactions contemplated hereby and thereby will not result in any
material violation of or conflict with, constitute a material default (with or
without notice of the lapse of time) under, or give rise to a right of
termination, cancellation, or acceleration of, or result in the imposition of
any Encumbrance under, or require any consent or authorization under, (i) the
Certificate of Incorporation or Bylaws of Shareholder or the Company or (ii)
any note, bond, debt instrument, mortgage, indenture or other material
contract, agreement, instrument or other document to which Shareholder or the
Company is a party or any Law or Order by which Shareholder or the Company may
be bound.
4.5 Litigation. Except as set forth on Schedule 4.5 hereto, there are no
Actions pending or, to the knowledge of Shareholder, threatened by or before
any Governmental Authority, and there are no Orders outstanding against
Shareholder, the Company or their respective Affiliates that (a) relate to the
ownership of the Shares by Shareholder, or (b) may reasonably be expected to
restrain, enjoin or otherwise prevent consummation of the transactions
contemplated by this Agreement or permit such consummation only subject to any
material condition or restriction applicable to Purchaser, or (c) may
reasonably be expected to materially and adversely affect the Company.
4.6 Material Properties; Title to Assets.
(a) Except as indicated on Schedule 4.6, upon consummation of the
transfer of the Transferred Assets pursuant to Section 6.6, the Company will
hold (i) good title to all Owned Assets and Transferred Assets of a type that
would be recorded on a balance sheet prepared in accordance with GAAP; and (ii)
valid leases under which it enjoys peaceful and undisturbed possession of real
or tangible personal property leased by it, in each case free and clear of all
Encumbrances except Permitted Encumbrances. There are no pending or, to the
Shareholder's knowledge, threatened condemnation proceedings relating to any
real property occupied by the Company.
(b) The Transferred Assets, the Owned Assets and the assets
transferred to Purchaser pursuant to the Intellectual Property Agreement
constitute all of the assets necessary to conduct the PerImmune Business
substantially as it has been conducted prior to Closing.
4.7 ERISA and Employee Plans.
(a) Schedule 4.7 contains a list of each Employee Plan and each
trust (including trusts intended to qualify under Section 501(a) of the Code
and trusts intended to qualify under Section 501(c)(9) of the Code) related
thereto.
10
12
(b) The Company has no liability, present or future, actual or
contingent, by reason of any contribution or obligation to contribute of the
Company or any ERISA Affiliate to any multiemployer plan (within the meaning of
Section 4001(a)(3) of ERISA).
(c) Each Employee Benefit Plan has been established, maintained and
administered, in all material respects, in compliance with its terms and with
all applicable laws and regulations, including without limitation, ERISA and
the Code.
(d) the Company has provided, or will have provided, to individuals
entitled thereto, all required notices within the applicable time period and
coverage pursuant to Section 4908B of the Code with respect to any "qualifying
event" (as defined Section 4980B(f)(3) of the Code) occurring prior to and
including the Closing Date with respect to any employee or former employee of
the Company.
(e) With respect to each Employee Plan which is an "employee pension
benefit plan" as defined in Section 3(2) of ERISA (each an "ERISA Pension
Plan"): (i) neither any ERISA Pension Plan nor any fiduciary with respect
thereto has engaged in any prohibited transaction in violation of Sections 404
or 406 of ERISA or any "prohibited transaction," as defined in Section
4975(c)(1) of the Code, or has otherwise violated the provisions of Part 4 of
Title I, Subtitle B of ERISA; (ii) the Company has not knowingly participated in
a violation of Part 4 of Title I, Subtitle B of ERISA by any plan fiduciary of
any Employee Plan and has not been assessed any civil penalty under Section
502(1) of ERISA; (iii) all filings, disclosure and reports as to each ERISA
Pension Plan required to be made to any governmental agency or ERISA Pension
Plan participant or beneficiary have been timely made; (iv) as of the last day
of the last plan year of each such ERISA Pension Plan and as of the Closing
Date, the fair market value of the assets of the ERISA Pension Plan is not less
than the present value of the accrued benefits (vested and unvested and
including ancillary benefits) of such ERISA Pension Plan; (v) no "accumulated
funding deficiency" (for which an excise tax is due or would be due in the
absence of a waiver) as defined in Section 412 of the Code or as defined in
Section 302(a)(2) of ERISA, whichever may apply, has been incurred with respect
to any ERISA Pension Plan with respect to any plan year, whether or not waived;
and (vi) neither the Company nor any ERISA Affiliate has any liability, present
or future, actual or contingent, under Title IV of ERISA (other than
contributions and PBGC premiums due in the ordinary course); and (vii) no filing
has been made by the Company or any ERISA Affiliate to, and no proceeding has
been commenced by the Pension Benefit Guaranty Corporation to, terminate any
ERISA Pension Plan.
(f) None of the Company, any ERISA Affiliate or any Employee Plan has any
present or future obligation to make any payment to, or with respect to any
present or former employee of the Company or any ERISA Affiliate pursuant to,
any retiree medical benefit plan, or other retiree Employee Plan, and no
condition exists which would prevent the Company from amending or terminating
any such benefit plan or Employee Plan.
(g) There is no contract, agreement, plan or arrangement covering any
employee or former employee of the Company (with respect to its relationship
with such
11
13
entity) that, individually or collectively, provides for the payment by the
Company of any amount (i) that is not deductible under Section 162(a)(1) or 404
of the Code or (ii) that is an "excess parachute payment" pursuant to Section
280G of the Code.
(h) No event has occurred in connection with which the Company or any
ERISA Affiliate or any Employee Plan, directly or indirectly, could be subject
to any material liability (A) under any statute, regulation or governmental
order relating to any Employee Plans or (B) pursuant to any obligation of the
Company to indemnify any person against liability incurred under any such
statute, regulation or order as they relate to the Employee Plans.
(i) Neither the execution and delivery of this Agreement by the Company
nor the consummation of the transactions contemplated hereby will result in the
acceleration or creation of any rights of any person to benefits under any
Employee Plan (including, without limitation, the acceleration of the vesting
or exercisability of any stock options, the acceleration of the vesting of any
restricted stock, the acceleration of the accrual or vesting of any benefits
under any ERISA Pension Plan or the acceleration or creation of any rights
under any severance, parachute or change in control agreement).
4.8 Taxes.
Except as set forth on Schedule 4.8:
(a) Filing of Returns. There have been properly completed and filed on a
timely basis and in correct form all Returns required to be filed on or prior to
the date hereof. As of the time of filing, the foregoing Returns correctly
reflected the facts regarding the income, business, assets, operations,
activities, status, or other matters of or affecting the Company or any other
information required to be shown thereon.
(b) Payment of Taxes. With respect to all amounts in respect of Taxes
imposed on the Company or for which the Company is or could be liable, whether
to taxing authorities (as, for example, under law) or to other persons or
entities (as, for example, under tax allocation agreements), with respect to
all taxable periods or portions of periods ending on or before the Closing
Date, all applicable tax laws and agreements have been fully complied with, and
all such amounts required to be paid to taxing authorities or others on or
before the date hereof have been or will be timely paid by Shareholder or its
Affiliates.
(c) Tax History.
(i) Since its incorporation on December 20, 1994, the Company has
been a member of an affiliated group filing a consolidated federal U.S. tax
return. The common parent of this affiliated group is and has been Akzo
Nobel Inc. ("Parent"). The Company was first active and first joined in the
consolidated Return for all of tax year 1995. Because of the election
described in section
12
14
9.5(e), the Company will join in the consolidated return of Parent
for a short tax year ending on the Closing Date. The Parent
Affiliated Group is currently under audit by the Internal Revenue
Service for tax years 1990 to 1993. Years prior to 1990 are closed
under the federal statute of limitations.
(ii) The Company will file an income tax Return in the State of
Maryland for tax year 1995 and will file a short period Return in the
State of Maryland for the short tax year ending on the Closing Date
as the result of the election described in Section 9.5(e). The
Maryland statute of limitations has not expired for tax year 1995.
Neither the Company nor Parent has been contacted by the State of
Maryland regarding an audit examination. The Company has not filed
(or been required to file) income tax Returns in any other state.
(d) Section 338(h)(10) Qualification. Parent is the common parent of
the affiliated group within the meaning of Section 1504(a) of the Code
that includes Shareholder and the Company (the "Parent Affiliated Group");
Parent will file a consolidated federal income tax Return that includes
Shareholder and the Company for the tax period that includes the Closing
Date; Parent will not be a target corporation within the meaning of
Section 338 of the Code for the Taxable Year that includes the Closing
Date; and Parent is eligible to make an election under Section 338(h)(10)
of the Code with respect to the Company.
4.9. Accounts. Schedule 4.9 sets forth an accurate and complete list of
each Bank Account, together with the names of all persons authorized to draw
from or to have access to Bank Accounts in the name of PerImmune.
5. REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser represents and warrants to Shareholder that:
5.1. Organization. Purchaser is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, and has
all requisite power and authority to own, lease and operate its properties, to
carry on its business as it is now being conducted and to enter into this
Agreement and the Closing Agreements to which it is a party and perform its
obligations thereunder.
5.2. Authorization. Purchaser has all necessary corporate power and
authority to execute and deliver this Agreement and the Closing Agreements to
which it is a party and to perform its obligations hereunder and thereunder and
to consummate the transactions contemplated hereby and thereby. The execution,
delivery and performance by Purchaser of this Agreement and the Closing
Agreements to which it is a party have been duly authorized by the board of
directors of Purchaser. This Agreement has been duly executed and delivered by
Purchaser, and, on the Closing Date, the Closing Agreements to which it is a
party will have been duly executed by Purchaser and do not require any approval
of the stockholders of Purchaser. This Agreement constitutes, and on the
Closing Date each Closing Agreement to which Purchaser
13
15
is a party will constitute, the legal, valid and binding obligation of Purchaser
enforceable against Purchaser in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the rights and remedies of creditors
generally and general principles of equity, regardless of whether applied in
equity or at law.
5.3. No Conflicts; Approvals. Except as forth on Schedule 5.3 hereto, the
execution, delivery and performance by Purchaser of this Agreement and the
Closing Agreements to which Purchaser is a party and the consummation of the
transactions contemplated hereby and thereby will not result in any material
violation of or conflict with, constitute a material default (with or without
notice or the lapse of time) under, or give rise to a right of termination,
cancellation, or acceleration of, or result in the imposition of any
Encumbrance under, or require any consent or authorization under, (i) the
Certificate of Incorporation or Bylaws of Purchaser, or (ii) any note, bond,
debt instrument, mortgage, indenture or other material contract, agreement,
instrument or other document to which the Purchaser is a party or any Law or
Order by which Purchaser may be bound.
5.4. Litigation. Except as set forth on Schedule 5.4 hereto, there are no
Actions pending or, to the knowledge of Purchaser, threatened by or before any
Governmental Authority, and there are no Orders outstanding against Purchaser
that may reasonably be expected to restrain, enjoin or otherwise prevent
consummation of the transactions contemplated by this Agreement or permit such
consummation only subject to any material condition or restriction applicable
to the Shareholder.
6. COVENANTS
Shareholder and Purchaser each covenants as follows:
6.1. Further Assurances. Each of the parties hereto agrees, both
before and after the Closing, (i) to use all reasonable efforts to take, or
cause to be taken, all actions and to do, or cause to be done, all things
necessary, proper or advisable to consummate and make effective the
transactions contemplated by this Agreement, (ii) to execute any documents,
instruments or conveyances of any kind which may be reasonably necessary or
advisable to carry out any of the transactions contemplated hereunder, and
(iii) to cooperate with each other in connection with the foregoing, including
using their respective reasonable efforts (A) to obtain all necessary waivers,
consents and approvals from Governmental Authorities and from third parties,
including, without limitation, consents to the transfer to the Company of the
Transferred Assets, (B) to obtain all necessary permits as are required to be
obtained under any federal, state, local or foreign law or regulations, (C) to
effect all necessary registrations and filings, including, without limitation,
submissions of information requested by Governmental Authorities and (D) to
fulfill all conditions to this Agreement.
6.2. No Solicitation. From the date hereof through the Closing or the
earlier termination of this Agreement, Shareholder shall not, and shall use all
reasonable efforts to cause its Affiliates and representatives (including,
without limitation, investment bankers, attorneys and
14
16
accountants) not to, directly or indirectly, enter into, solicit, initiate or
continue any discussions or negotiations with, or encourage or agree to any
inquiries or proposals by, or participate in any negotiations with, or provide
any information to, or otherwise cooperate in any other way with, any person,
other than Purchaser and its representatives, concerning any sale of all or any
substantial portion of the Company's assets or the PerImmune Business
(including the Transferred Assets), or of any shares of capital stock of the
Company, or any merger, consolidation, liquidation, dissolution or similar
transaction involving the Company.
6.3. Notification of Certain Matters. From the date hereof through the
Closing, Shareholder shall give prompt notice to Purchaser and Purchaser shall
give prompt notice to Shareholder of (a) the occurrence, or failure to occur,
of any event which occurrence or failure would be likely to cause any of
Shareholder's and Purchaser's respective representations or warranties
contained in this Agreement to be untrue or inaccurate in any material respect
and (b) any material failure of Shareholder and Purchaser to comply with or
satisfy any of its respective covenants, conditions or agreements to be
complied with or satisfied by it under this Agreement; provided, however, that
such disclosure shall not be deemed to cure any breach of a representation,
warranty, covenant or agreement, or to satisfy any condition.
6.4. Conduct of the Company Prior to the Closing. Prior to the Closing,
Shareholder shall cause the Company to conduct its business only in the
ordinary and regular course (that is, reasonably consistent with past custom
and practice), except as otherwise approved in writing by Purchaser. Without
limiting the generality of the preceding sentence, except as otherwise approved
in writing by Purchaser, Shareholder shall not permit the Company to:
(a) Amend the Company's charter documents;
(b) Issue or purchase any shares of its capital stock or grant any
options, warrants, subscriptions, commitments or other rights of any character
to acquire any of its capital stock;
(c) Declare or pay any dividend, or make any other distribution or
payment, with respect to its capital stock, other than the Settlement Dividend;
(d) Amend or terminate any of the Company's agreements, except in
the ordinary course of business or as provided for in the Letter Agreement;
(e) Make any capital expenditure or guarantee or incur any
indebtedness or other liabilities, except in the ordinary course of business;
(f) Enter into any agreement, except in the ordinary course of
business;
(g) Sell, lease, license, transfer, pledge or assign any of the
Owned Assets or the Transferred Assets, except in the ordinary course of
business; or
15
17
(h) Alter the manner of keeping the Company's books, accounts or
records except for alterations mutually agreed to by Shareholder and
Purchaser made in connection with the settlement of intercompany accounts
as provided in Section 6.11(a).
6.5. Tax Matters.
(a) Termination of Existing Tax-Sharing Agreements. All tax-sharing
agreements or similar agreements with respect to or involving the Company
shall be terminated prior to the Closing Date, and, after the Closing
Date, the Company shall not be bound thereby or have liability thereunder
for amounts due in respect of period prior to the Closing Date.
(b) Tax Elections. No new elections with respect to Taxes or any
changes in current elections with respect to Taxes affecting the Company
shall be made after the date of this Agreement without prior written
consent of Purchaser.
(c) Clearance Certificate. As a condition precedent to the
consummation of the transactions contemplated by this Agreement,
Shareholder shall provide Purchaser with a clearance certificate or
similar document(s) that may be required by any state taxing authority
in order to relieve Purchaser of any obligation to withhold any portion of
the Purchase Price.
(d) FIRPTA Certificate. As a condition precedent to the consummation
of the transactions contemplated by this Agreement, Shareholder shall
furnish Purchaser an affidavit, stating, under penalty of perjury, that
the indicated number is the transferor's United States taxpayer
identification number and that the transferor is not a foreign person,
pursuant to Section 1445(b)(2) of the Code.
(e) Cooperation and Records Retention.
(i) Shareholder shall, at the expense of Shareholder, prepare
all Returns in respect of Taxes for the Company for taxable years or
periods ending on or before the Closing Date. Such Returns shall
include Returns for the short taxable period ending on or before the
Closing Date which may arise as the result of the election described
in Section 9.5(e). The Company and Purchaser shall cooperate with
Shareholder to supply any and all information reasonably requested to
complete such Returns. Information necessary to complete Returns for
the short period ending on or before the Closing Date will be supplied
by March 15, 1997. Such short period Return information shall be based
upon an actual closing of the Company's financial books and records as
of the Closing Date, rather than a pro ration of financial data for
the period which straddles the Closing Date. When requested by
Shareholder, the Company and/or Purchaser (as appropriate) shall sign
any such Returns, which will then be filed by Shareholder in a timely
manner. Shareholder shall provide Purchaser a reasonable opportunity
to review any such Return prior to signing such Return.
16
18
(ii) The Company shall, at the expense of the Company, prepare
all Returns in respect of Taxes for the Company for taxable years or
periods ending after the Closing Date. Such Returns shall include
Returns for the short taxable period beginning after the Closing Date
which may arise as the result of the election described in Section
9.5(e). Shareholder shall cooperate with the Company to supply any and
all information reasonably requested by the Company to complete such
Returns.
(iii) Shareholder and Purchaser shall (i) each provide the other,
and Purchaser shall cause the Company to provide Shareholder, with
such assistance as may reasonably be requested by any of them in
connection with the preparation of any Return, audit, or other
examination by any taxing authority or judicial or administrative
proceedings relating to liability for Taxes, (ii) each retain and
provide the other, and Purchaser shall cause the Company to retain
and provide the other, and Purchaser shall cause the Company to retain
and provide Shareholder with, any records or other information that
may be relevant to such Return, audit or examination, proceeding, or
determination, and (iii) each provide the other with any final
determination of any such audit or examination, proceeding, or
determination that affects any amount required to be shown on any
Return of the other for any period. Without limiting the generality of
the foregoing, Purchaser shall retain, and shall cause the Company to
retain, and Shareholder shall retain, until the applicable statutes of
limitation (including any extensions) have expired, copies of all
Returns, supporting work schedules, and other records or information
relating to Taxes in respect of the Company or the PerImmune Business
that may be relevant to such returns for all tax periods or portions
thereof ending before or including the Closing Date and shall not
destroy or otherwise dispose of any such records without first
providing the other party with a reasonable opportunity to review and
copy the same.
6.6 Transfer of Assets. Immediately prior to the Closing, Shareholder
shall assign, transfer and convey to the Company all the Transferred Assets.
6.7 Resignation of Directors. Shareholder shall cause all members of the
Board of Directors of the Company to resign, effective immediately upon the
Closing.
6.8 Employee Benefit Matters.
(a) Continuation of Participation in Employee Plans and Transition
(i) Effective on and as of the Closing Date, Shareholder shall
permit Company to continue participation in, the Akzo Nobel Incentive
Savings Plan (the "ISP"); the Akzo Nobel Retirement Plan (the "ANRP");
and all other welfare plans (medical, dental, disability, etc.), in
which Company participated prior to the Closing Date (collective, the
"Continuation Plans") through November 30, 1996 (the "Continuation
Period"). During the Continuation Period, all employees of
17
19
Company shall be permitted to participate in the Continuation Plans as
if Company remained a subsidiary of Shareholder. Participation of
Company in each Continuation Plan shall, however, end prior to
November 30, 1996 upon Company's providing notice to Shareholder of
Company's desire to cease its participation in any one or all of the
Continuation Plans.
(ii) Company shall reimburse Shareholder for any costs
advanced on Company's behalf with respect to its continuation in the
Continuation Plans; actual third party expenses; and out-of-pocket
costs incurred by Shareholder as the result of Company's continuation
in the Continuation Plans. Such reimbursement shall be made within 30
days of receipt by Company of Shareholder's detailed invoice.
(iii) Shareholder shall cooperate with Company in its
establishment of benefit plans for Company employees by providing
Company with such employee census, benefit calculations, service data,
claims experience and other similar data as Company shall reasonably
request.
(b) COBRA
Company shall be responsible and liable for continuation coverage to
Company employees and their qualified beneficiaries in compliance with the
provisions of Code Section 49808 and ERISA Section 601 et seq. (herein referred
to as "COBRA continuation coverage") with respect to whom a qualifying event
occurs after the Closing Date, and Company agrees to indemnify and hold
Shareholder harmless from any claims for COBRA continuation coverage made by or
on behalf of such employees and their qualified beneficiaries. Shareholder
shall retain all obligations and liabilities to provide COBRA continuation
coverage to employees and former employees of Shareholder and Company and their
qualified beneficiaries (i) who are receiving COBRA continuation coverage at
the Closing or (ii) with respect to whom a qualifying event occurred on or
prior to the Closing and for which the applicable election period for COBRA
continuation coverage has not expired as of the Closing Date, and Shareholder
agrees to indemnify and hold Company harmless from any claims for COBRA
continuation coverage made by or on behalf of such employees and their
qualified beneficiaries.
(c) Pension Plan
(i) As soon as practical after the Closing Date and prior
to November 30, 1996, Company shall determine if it will adopt a
defined benefit plan for its employees. If no such plan is adopted,
following the date of Company's cessation of participation in the ANRP
(the "Cessation Date"), Shareholder will freeze past accrued benefits
as of the Cessation Date for Company's employee members under the
terms of the ANRP.
(ii) If Company establishes a defined benefit plan (the
Company's "Pension Plan"), Shareholder shall transfer or cause to be
transferred from the ANRP to the trustee of the Pension Plan cash or
marketable securities in an
18
20
amount equal to the present value of the benefits accrued, through the
Cessation Date under the ANRP, using the ANRP' regular actuarial
assumptions for ERISA funding purposes, except substituting 7% as the
interest rate to be used as part of such assumptions; subject to
meeting the requirements of Code Section 4.14(l). Such amount shall be
further adjusted by Shareholder's actuary, taking into account benefit
payments made subsequent to the Cessation Date; actual return on trust
assets from the Cessation Date to the date assets are actually
transferred. The transfer shall be made on the latest of (A) 120 days
after being notified of Company's decision to establish a defined
benefit plan; (B) 30 days after the filing of notification with the
Internal Revenue Service of such transfer; (C) the receipt by
Shareholder of an opinion by Company's legal counsel verifying that
the Pension Plan meets the requirements of Code Section 401(a), and
that the Pension Plan's related trust is exempt from taxes under Code
Section 501(a); or (D) the completion of Company's actuary review and
acceptance of the calculations performed by Shareholder's actuary in
determining asset transfer amount.
(d) Savings Plan Asset Transfer or Distribution
Shareholder shall transfer or cause to be transferred to the trustee of
any Company qualified defined contribution plan cash or marketable securities
in an amount equal to the account balances as of the date of such transfer of
Company employees in the ISP within the latest of 60 days following the Closing
Date; 30 days after the filing of notification with the IRS of such transfer;
or the receipt by Shareholder of an opinion by Company's legal counsel
verifying that such plan meets the requirements of Code Section 401(a) or
401(k), and that the Plan's related trust is exempt from taxes under Code
Section 501(a).
(e) Nothing contained in this Agreement shall confer upon any
Company employee any rights with respect to continuance of employment by
Company, nor shall anything herein restrict Company in the exercise of its
independent business judgment in modifying any of the terms and conditions
of the employment of the Company employees. No provision of this Agreement
shall create any third party beneficiary rights in any Company employee,
any beneficiary or dependents thereof, or any collective bargaining
representative thereof, with respect to the compensation, terms and
conditions of employment of benefits that may be provided to any Company
employee by Company or under any benefit plan which Company may maintain.
(f) Purchaser recognizes and acknowledges that Company has assumed
and is responsible for payment of all benefits accrued or claimed by its
employees under any of the Employee Plans, including benefits attributable
to any prior employment with Shareholder, (and specifically including any
severance and accrued vacation) and that, except for the transfer of funds
from the ANRP and ISP as provided in (c) and (d) above, Shareholder shall
have no responsibility or liability with respect to any such benefits or
payments to any Company employee.
19
21
6.9 Government Contracts; Novation. Schedule 6.9 sets forth all
Government Contracts used in the PerImmune Business. As promptly as
practicable, the Company will enter into a novation agreement or agreements
with the United States Government with respect to the Government Contracts, to
the extent so required. Shareholder and Purchaser will cooperate fully with the
Company in obtaining the novation of all such Government Contracts, to the
extent required.
6.10 Purchase Price Note. At or prior to the Closing, Shareholder will
enter into a credit facility (the "Credit Facility") pursuant to which
Shareholder agrees to loan to the Company up to $3,600,000 (at a rate of
$720,000 per month for five months). The initial advance shall be made on the
later of August 1, 1996 or the Closing Date, and each advance thereafter shall
be made on the first day of the month. Borrowings under the Credit Facility
shall accrue interest from the date of advance at a fixed rate per annum equal
to eight percent (8%). The outstanding principal balance under the Credit
Facility (including all accrued and unpaid interest) shall be due and payable
on December 31, 1996, provided that (i) in the event that, prior to such date,
the Company has procured a commitment for financing to be used, in part, to
repay the amounts due under the Credit Facility, then the final maturity date
shall be extended for a period of time necessary to consummate such financing,
such period not to extend beyond January 31, 1997, and (ii) in the sole
discretion of Shareholder, the final maturity may be extended for up to three
additional months during which time Shareholder will loan to the Company up to
an additional $1,800,000 pursuant to advances not to exceed $600,000 per month,
which advances will be evidenced by a promissory note. The outstanding
principal balance outstanding under the Credit Facility (including all accrued
and unpaid interest) is subject to prepayment under the terms set forth in the
Credit Facility and shall be secured by a pledge of certain assets of the
Company.
6.11 Current Accounts of PerImmune.
(a) Settlement of Intercompany Accounts. Prior to the Closing Date,
Shareholder shall cause the Company to declare and pay to Shareholder a
dividend (the "Settlement Dividend") in the amount of $2,871,532
representing the sum of (i) the balance of cash reflected on the Closing
Balance Sheet, and (ii) the balance of the intercompany account receivable
account on the Closing Balance Sheet less (iii) the Company's intercompany
accounts payable to OTC and its Affiliate. Upon payment of the Settlement
Dividend, the balance of the Company's intercompany account(s) receivable
from, and intercompany accounts payable to, Shareholder and its Affiliate
shall be deemed paid in full and reduced to zero.
(b) Working Capital Facility. On the Closing Date, Shareholder and
the Company shall enter into a working capital facility (the "Working
Capital Facility") pursuant to which Shareholder agrees to loan to the
Company up to $2,871,532. Borrowings under the Working Capital Facility
shall be at the request of the Company and subject to the approval of
Shareholder. The parties agree that the purpose of the Working Capital
Facility is to provide for the Company's working capital needs during the
period of time covered by the Working Capital Facility, and that the
approval of Shareholder shall not unreasonably be withheld. Borrowings
under the Working Capital Facility shall accrue
20
22
interest from the date of advance at a fixed rate per annum equal to eight
percent (8%). The outstanding principal balance under the Working Capital
Facility (including all accrued and unpaid interest) shall be due and
payable on the date twelve (12) months following the Closing Date and
shall be secured by a pledge of certain assets of Purchaser. On the
Closing Date, Shareholder shall transfer to the Company $2,000,000 in
immediately available funds as an advance on the Closing Date under the
Working Capital Facility.
(c) July Current Accounts. On the Closing Date, Shareholder shall
transfer to the Company, in immediately available funds, an amount equal
to all cash received by Shareholder and its Affiliates from or on behalf
of the Company or in respect of the PerImmune Business from and after the
Effective Date but on or prior to the Closing Date (net of amounts paid
by Shareholder and its Affiliates during such period to or on behalf of the
Company or in respect of the PerImmune Business in the ordinary course of
business consistent with past practices). In the event that the amount
calculated pursuant to this paragraph shall be less than zero, then the
Company shall be deemed to have made a request for, and Shareholder shall
be deemed to have approved, effective the Closing Date, borrowing under
the Working Capital Facility in the amount necessary to reduce such
negative balance to zero, but not to exceed the total amount of permitted
borrowing thereunder. Any borrowings under the Working Capital Facility
pursuant to this Section 6.11(c) shall be in addition to amounts advanced
on the Closing Date pursuant to the last sentence of Section 6.11(b).
(d) Further Assurances. From and after the Closing Date, Shareholder
shall, and shall cause its Affiliates to, promptly transfer to the Company
all amounts received by Shareholder and such Affiliates in respect of, or
relating to the PerImmune Business (including all payments made by
PerImmune's customers). Shareholder shall, and shall cause its
Affiliates to promptly transfer to (and not pay) any request for payment
from third parties in respect of, or related to the PerImmune Business.
6.12. Property and Casualty Insurance. Shareholder shall cause the
liabilities and obligations of the Company of a type currently covered by the
master casualty insurance program of Shareholder or its Affiliate which are
incurred prior to Closing to be administered by Shareholder, or such Affiliate,
consistent with past practice.
7. CONDITIONS TO SHAREHOLDER'S OBLIGATIONS
The obligations of Shareholder to effect the Closing are subject to
the satisfaction, on or prior to the Closing, of each of the following
conditions, any of which may be waived by Shareholder.
7.1 Representations, Warranties and Covenants. All representations and
warranties of Purchaser contained in this Agreement shall be true and correct
in all material respects at and as
21
23
of the date of this Agreement and at and as of the Closing, except as and to
the extent that the facts and conditions upon which such representations and
warranties are based are expressly required or permitted to be changed by the
terms hereto; and Purchaser shall have performed and satisfied all material
agreements and covenants required hereby to be performed by it prior to the
Closing.
7.2. No Proceeding or Litigation. No Action by any Governmental Authority
or other Person shall have been instituted which would reasonably be expected
to materially damage Shareholder if the transactions contemplated hereunder are
consummated.
7.3. Certificates. Purchaser shall furnish Shareholder with such
certification of its duly authorized officers and others to evidence compliance
with the conditions set forth in this Article 7 as may be reasonably requested
by Shareholder.
7.4. Corporate Documents. Shareholder shall have received from Purchaser
resolutions adopted by the board of directors of Purchaser, approving this
Agreement, the Purchase Price Note, the Closing Agreements to which it is a
party and the transactions contemplated hereby and thereby, certified by
Purchaser's corporate secretary, as applicable.
7.5. Consents. All governmental consents necessary to effect the Closing,
and all third party consents to the transactions contemplated hereby (including
with respect to the conveyance of the Transferred Assets) shall have been
obtained (it being understood that pursuant to Section 6.9 hereof the necessary
consent or approval for the novation of certain of the Government Contracts
need not be obtained prior to the Closing).
7.6. Other Agreements. Purchaser shall have executed and delivered the
Closing Agreements in the forms attached as exhibits hereto.
8. CONDITIONS TO PURCHASER'S OBLIGATIONS
The obligations of Purchaser to consummate the transactions provided
for hereby are subject to the satisfaction, on or prior to the Closing, of each
of the following conditions, any of which may be waived by Purchaser:
8.1. Representations, Warranties and Covenants. All representations and
warranties of Shareholder contained in this Agreement shall be true and
correct in all material respects at and as of the date of this Agreement and at
and as of the Closing except as and to the extent that the facts and conditions
upon which such representations and warranties are based are expressly required
or permitted to be changed by the terms hereof; and Shareholder shall have
performed and satisfied all material agreements and covenants required hereby
to be performed by it prior to the Closing.
8.2. No Proceedings or Litigation. No Action by any Governmental Authority
or other Person shall have been instituted which would reasonably be expected
to materially damage Purchaser if the transactions contemplated hereby are
consummated.
22
24
8.3. Certificates. Shareholder shall furnish Purchaser with such
certificates of its duly authorized officers and others to evidence compliance
with the conditions set forth in this Article 8 as may be reasonably requested
by Purchaser.
8.4. Corporate Documents. Purchaser shall have received from Shareholder
resolutions adopted by the board of directors of Shareholder, approving this
Agreement, the Closing Agreements to which it is a party, and the transactions
contemplated hereby and thereby, certified by Shareholder's corporate
secretary, as applicable.
8.5. Consents. All governmental consents necessary to effect the Closing,
and all third party consents to the transactions contemplated hereby (including
with respect to the conveyance of the Transferred Assets) shall have been
obtained (it being understood that pursuant to Section 6.9 hereof the necessary
consent or approval for the novation of certain of the Government Contracts
need not be obtained prior to the Closing).
8.6. Other Agreements. Shareholder shall have executed and delivered the
Closing Agreements in the forms attached as exhibits hereto.
9. ACTIONS BY SHAREHOLDER AND PURCHASER AFTER THE CLOSING
9.1. Further Actions. On and after the Closing Date, Purchaser and
Shareholder will take all appropriate actions and execute all documents,
instruments or conveyances of any kind which may be reasonably necessary or
advisable to confirm or effect Purchaser's ownership, possession and control
(in accordance with this Agreement) of the shares and the Company's ownership,
possession and control (in accordance with this Agreement) of the Transferred
Assets, including but not limited to the novation of Government Contracts used
in the PerImmune Business, if required, and transfer of monies received by
Shareholder and its Affiliates after the Closing Date from PerImmune customers
and intended for PerImmune.
9.1. Survival of Representations and Warranties. The representations and
warranties of Shareholder, on the one hand, and Purchaser, on the other hand,
contained herein, and all claims and causes of action with respect thereto,
shall survive the Closing Date, to the extent herein set forth: (a) with
respect to the representations and warranties in Sections 4.2 and 4.6(a) hereof
for an indefinite period, (b) with respect to the representations and
warranties in Section 4.7 and 4.8 hereof until 60 days after the expiration of
the applicable statute of limitations (with extensions); (c) with respect to
all other representations and warranties until the date two years from the
Closing Date. The termination of the representations and warranties provided
herein shall not affect the rights of a party in respect of any Claim made by
such party in a writing received by the other party prior to the expiration of
the applicable survival period provided herein.
9.3. Books and Records.
(a) Purchaser agrees that it will cooperate with and make available
to Shareholder, during normal business hours, all PerImmune Books and
Records, and PerImmune employees (without substantial disruption of
employment) which are
23
25
necessary or useful in connection with any tax inquiry, audit,
investigation or dispute, any litigation or investigation or any other
matter requiring any such PerImmune Books and Records (including such
employees) for any reasonable business purpose; it being understood that
all PerImmune Books and Records shall be maintained by Purchaser for
three (3) years following the Closing. Except as otherwise required in
Section 9.4, Shareholder shall bear all of the out-of-pocket costs and
expenses (including, without limitation, attorney's fees, but excluding
reimbursement for salaries and employee benefits) reasonably incurred in
connection with providing such PerImmune Books and Records.
Notwithstanding the foregoing, Purchaser shall retain all PerImmune Books
and Records relevant to any Return until sixty (60) days following the
expiration of the relevant statute of limitations.
(b) Shareholder agrees that it will cooperate with and make
available to Purchaser, during normal business hours, all Shareholder's
Books and Records, and employees of Shareholders or the Affiliates
(without substantial disruption of employment) which are necessary or
useful in connection with any tax inquiry, audit, investigation or
dispute, any litigation or investigation or any other matter requiring any
such Shareholder's Books and Records, (including such) employees for any
reasonable business purpose; it being understood that all Shareholder's
Books and Records shall be maintained by Shareholder for three (3) years
following the Closing. Except as otherwise required in Section 9.4,
Purchaser shall bear all of the out-of-pocket costs and expenses
(including, without limitation, attorney's fees, but excluding
reimbursement for salaries and employee benefits) reasonably incurred in
connection with providing such Shareholder's Books and Records.
Notwithstanding the foregoing, Shareholder shall retain all Shareholder's
Books and Records relevant to any Return until sixty (60) days following
the expiration of the relevant statute of limitations.
9.4. Indemnification
(a) By Shareholder. Shareholder shall indemnify, save and hold
harmless Purchaser, the Company, their respective Affiliates and
subsidiaries, and their respective directors, officers, shareholders and
employees (the "Purchaser Indemnitees") from and against any and all costs,
losses, Taxes, liabilities, damages, lawsuits, deficiencies, claims,
demands, and expenses (whether or not arising out of third-party claims),
including, without limitation, reasonable attorneys' fees and all
reasonable amounts paid in investigation, defense or settlement of any of
the foregoing herein (collectively, "Damages") incurred in connection
with, arising out of or resulting from (i) any breach of any
representation, warranty, covenant or agreement made by Shareholder in
this Agreement; (ii) any Excluded Liability and any liability or
obligation of Shareholder or its Affiliate that does not relate to
operations of the Company or the PerImmune Business; and (iii) any
liability arising from Shareholder's responsibility for Taxes pursuant to
Section 9.5, provided, however, that Shareholder shall not be liable to
the Purchaser Indemnitees in respect of a breach of a representation or
warranty made by Shareholder in this Agreement which was true as of the
date of this Agreement but which is rendered inaccurate by events beyond
the control of Shareholder occurring between the date of this
24
26
Agreement and the Closing, to the extent that Shareholder has notified
Purchaser of such breach in writing prior to the Closing and Purchaser has
effected the Closing with knowledge of such breach.
(b) By Purchaser. Purchaser shall indemnify, save and hold harmless
Shareholder, Affiliates and subsidiaries, and their respective directors,
officers, shareholders and employees (the "Shareholder Indemnitees") and,
together with the Purchaser Indemnitees, the "Indemnitees") from and
against any and all Damages incurred in connection with, arising out of or
resulting from (i) any breach of any representation, warranty, covenant or
agreement made by Purchaser in this Agreement; and (ii) any PerImmune
Liabilities and (iii) any liability arising from Purchaser's
responsibility for Taxes pursuant to Section 9.5.
(c) Damages. The term "Damages" as used in this Section 9.4 is not
limited to matters asserted by third parties, but includes Damages
incurred or sustained by an Indemnitee in the absence of third party
claims. Payments by an Indemnitee or amounts for which such Indemnitee is
indemnified hereunder shall not necessarily be a condition precedent to
recovery.
(d) Defense of Claims. If a claim for Damages (a "Claim") is to be
made by an Indemnitee, such Indemnitee shall, subject to Section 9.2, give
written notice (a "Claim Notice) to the indemnifying party as soon as
practicable after such Indemnitee becomes aware of any fact, condition or
event which may give rise to Damages or which indemnification may be
sought under this Section 9.4. If any lawsuit or enforcement action is
filed against any Indemnitee hereunder, notice thereof (a "Third Party
Notice") shall be given to the indemnifying party as promptly as
practicable (and in any event within fifteen (15) calendar days after the
service of the citation or summons). The failure of any indemnified party
to give timely notice hereunder shall not affect rights to indemnification
hereunder, except to the extent that the indemnifying party demonstrates
actual damage caused by such failure. After receipt of a Third Party
Notice, if the indemnifying party shall acknowledge in writing to the
indemnified party that the indemnifying party shall be obligated under the
terms of its indemnity hereunder in connection with such lawsuit or
action, then the indemnifying party shall be entitled, if it so elects,
(i) to take control of the defense and investigation of such lawsuit or
action, (ii) to employ and engage attorneys of its own choice to handle
and defend the same, at the indemnifying party's cost, risk and expense
unless the named parties to such action or proceeding include both the
indemnifying party and the indemnified party and the indemnified party has
been advised in writing by counsel that there may be one or more legal
defenses available to such indemnified party that are different from or
additional to those available to the indemnifying party, and (iii) to
compromise or settle such claim, which compromise or settlement shall be
made only with the written consent of the indemnified party, such consent
not to be unreasonably withheld. The indemnified party shall cooperate in
all reasonable respects with the indemnifying party and such attorneys in
the investigation, trial and defense of such lawsuit or action and any
appeal arising therefrom; and the indemnified party may, at its own cost,
participate in the investigation, trial and defense of
25
27
such lawsuit or action and any appeal arising therefrom and appoint its
own counsel therefor, at its own cost. The parties shall also cooperate
with each other in any notifications to insurers. If the indemnifying
party fails to assume the defense of such claim within fifteen (15)
calendar days after receipt of the Third Party Notice, the indemnified
party against which such claim has been asserted will (upon delivering
notice to such effect to the indemnifying party) have the right to
undertake the defense, compromise or settlement of such claim and the
indemnifying party shall have the right to participate therein at its own
cost; provided, however, that such claim shall not be compromised or
settled without the written consent of the indemnifying party, which
consent shall not be unreasonably withheld. In the event the indemnified
party assumes the defense of the claim the indemnified party will keep the
indemnifying party reasonably informed of the progress of any such
defense, compromise or settlement.
(e) Limitation on Indemnities. (i) No claim may be made against an
indemnifying party for indemnification pursuant to either Section 9.4(a)(i)
or Section 9.4(b)(i) with respect to any individual item of Damage, or any
series of related items of Damage not exceeding $15,000, until the
aggregate dollar amount of all Damages indemnifiable pursuant to this
Section 9.4 exceeds $50,000. The indemnification of obligations of
Shareholders pursuant to Section 9.4(a)(i) and the indemnification of
obligations of Purchaser pursuant to Section 9 .4(b)(i), shall each be
effective only until the dollar amount paid in respect of the Damages
indemnified against under such clause of this Agreement aggregates to an
amount equal to $8,500,000; and (ii) Purchaser shall not be entitled to
indemnification based upon the breach of any representation or warranty of
Shareholder if, as of the Closing, Purchaser had actual knowledge of facts
that cause such representation or warranty to be untrue. For purposes of
the foregoing, the parties intend only that the actual knowledge of Xxxxxxx
X. Xxxxx, Xx., and of senior management and laboratory directors of
PerImmune on the Closing Date shall be imputed to Purchaser. Such persons
shall not be personally liable to Shareholder under the provisions of the
preceding sentence. Shareholder shall not be entitled to indemnification
based upon the breach of any representation or warranty of Purchaser if, as
of Closing, Shareholder or any of its senior management personnel had
actual knowledge of facts that cause such representation and warranty to be
untrue.
(f) Brokers and Finders. Pursuant to the provisions of this Section
9.4, each of Purchaser and Shareholder shall indemnify, hold harmless and
defend the other party from the payment of any and all broker's and
finder's expenses, commissions, fees or other forms of compensation which
may be due or payable from or by the indemnifying party, or may have been
earned by any third party acting on behalf of the indemnifying party in
connection with the negotiation and execution hereof and the consummation
of the transactions contemplated hereby.
26
28
9.5. Responsibility for Taxes.
(a) Division of Responsibility. Shareholder shall be responsible for
(and shall indemnify and hold harmless Purchaser, the Company, and each
of their respective Affiliates, successors and assigns from and against)
all Taxes (i) with respect to all tax periods of the Company ending on or
prior to the Closing Date, (ii) with respect to any tax period of the
Company beginning before the Closing Date and ending after the Closing
Date, but only with respect to the portion of such period up to and
including the Closing Date (such portion, a "Pre-Closing Partial
Period"), or (iii) payable as a result of a material breach of any
representation or warranty set forth in Section 4.8 of this Agreement,
except in each case to the extent that the liability for such Taxes is
reflected on the Closing Balance Sheet. Purchaser and the Company shall be
responsible for (and shall jointly and severally indemnify and hold
harmless Shareholder, and its Affiliates, successors and assigns from and
against) all Taxes (i) with respect to all tax periods of the Company
beginning after the Closing Date, and (ii) with respect to any tax period
of the Company beginning before the Closing Date and ending after the
Closing Date, but only with respect to the portion of such period
commencing after the Closing Date (such portion, a "Post-Closing Partial
Period").
(b) Effect of Carryovers and Carrybacks. For purposes of this
Section 9.5, Tax or Taxes shall include the amount of Taxes which would
have been paid but for the application of any credit or net operating or
capital loss deduction attributable to periods beginning after the Closing
Date or to any Post-Closing Partial Period, but shall not include amounts
which would have been paid but for the application of any credit or net
operating or capital loss deductions attributable to periods ending on
or prior to the Closing Date or to any Pre-Closing Partial Period.
(c) Allocation Between Partial Periods. With respect to any tax
period of the Company beginning before the Closing Date and ending after
the Closing Date, any Taxes for such period shall be apportioned between
the Pre-Closing Partial Period and the Post-Closing Partial Period based,
in the case of real and personal property Taxes, on a per diem basis and,
in the case of other Taxes, on the actual activities, taxable income or
taxable loss of the Company and its subsidiaries, if any, during such
Pre-Closing Partial Period and such Post-Closing Partial Period.
(d) Post-Closing Audits and Other Proceedings. Shareholder, on the
one hand, and Purchaser, on the other hand, agree to give prompt notice to
each other of any proposed adjustment to Taxes for periods ending on or
prior to the Closing Date or any Pre-Closing Partial Period. Shareholder
and Purchaser shall cooperate with each other in the conduct of any audit
or other proceedings involving Company for such periods and each may
participate at its own expense, provided each party hereto shall have the
right to control the conduct of any such audit or proceeding for which
such party (i) agrees that any resulting Tax is covered by the indemnity
provided in Section 9.5(a) of this Agreement, and (ii) demonstrates its
ability to make such indemnity payment. Notwithstanding the foregoing,
Shareholder may not settle or otherwise resolve any such
27
29
claim, suit or proceeding without the consent of Purchaser, such consent
not to be unreasonably withheld and Purchaser may not settle or otherwise
resolve any such claim, suit or proceeding without the consent of
Shareholder, such consent not to be unnecessarily withheld.
(e) Section 338(h)(10) Election. Shareholder shall cause Parent to
join with Purchaser in making and Purchaser agrees to join Parent in
making an election under Section 338(h)(10) of the Code and any
corresponding elections permitted under state, local or foreign law with
respect to the acquisition of the Company and, if no election may be made
pursuant to such state, local or foreign law under an election
corresponding to Code Section 338(h)(10), elections corresponding to
Section 338(a) and 338(g) of the Code, provided as to such jurisdiction
Shareholder is not also subject to tax on the gain realized upon the sale
of the capital stock of the Company. Purchaser and Parent shall exchange
completed and executed copies of Internal Revenue Service Form 8023-A,
required Schedules thereto, and any similar state, local and foreign
forms at or prior to the Closing. Shareholder and Purchaser agree that as
soon as practicable after Closing, they shall allocate the Purchase Price
and all other capitalized costs among the Company's assets for income tax
purposes in accordance with an allocation schedule (the "Purchase Price
Allocation Schedule") proposed by Purchaser and reasonably acceptable to
Shareholder, which shall be delivered by Purchaser to Shareholder. In
connection therewith, Shareholder and Purchaser shall discuss the
allocation of the Purchase Price and other capitalized costs among the
Company's assets and attempt in good faith to reach agreement with respect
thereto. Shareholder and Purchaser acknowledge that for United States
federal income tax purposes (and for purposes of state, local or foreign
taxes in jurisdictions which permit elections analogous to the election
permitted under Section 338(h)(10) of the Code) the acquisition of the
stock will be treated by the parties as if it is a sale of the assets of
the Company to a new corporation owned by Purchaser, followed by a
complete liquidation of the Company to a new corporation owned by
Purchaser, followed by a complete liquidation of the Company. The parties
agree to report the transaction in a manner consistent with this treatment.
9.6 Confidentiality.
(a) Shareholder and its Affiliates have obtained confidential
information relating to the business, operations and assets (including
the Transferred Assets) of the Company. Following the Closing, Shareholder
and its Affiliates shall treat such information as confidential and shall
preserve the confidentiality thereof, not duplicate or use such
information and instruct their employees who have had access to such
information to keep confidential and not to use any such information
unless such information (i) is now or is hereafter disclosed, through no
act or omission of Shareholder or its Affiliates, in a manner making it
available to the general public or (ii) is required by law to be disclosed.
(b) Purchaser, the Company and their respective Affiliates have
obtained confidential information relating to the business operations and
assets of Shareholder. Following the Closing, Purchaser, the Company and
their respective Affiliates shall treat
28
30
such information as confidential and shall preserve and confidentiality
thereof, not duplicate or use such information and instruct their
employees who have had access to such information to keep confidential and
not to use any such information unless such information (i) is now or is
hereafter disclosed through no act or omission of Purchaser, the Company
or their Affiliates, in a manner making it available to the general public
or (ii) is required by law to be disclosed.
10. MISCELLANEOUS
10.1. Termination.
(a) This Agreement may be terminated at any time prior to Closing;
(i) By mutual written consent of Shareholder and Purchaser;
(ii) By Purchaser, or Shareholder if the Closing shall not have
occurred on or before August 31, 1996; provided however, that this
provision shall not be available to Purchaser, if Shareholder has the
right to terminate this Agreement under clause (iv) of this Section
10.1(a); and this provision shall not be available to Shareholder if
Purchaser has the right to terminate this Agreement under clause
(iii) of this Section 10.1;
(iii) By Purchaser if there is a material breach of any
representation or warranty set forth in Article 4 hereof or any
covenant or agreement to be complied with or performed by Shareholder
pursuant to the terms of this Agreement, provided that Purchaser may
not terminate this Agreement prior to the Closing if Shareholder has
not had an adequate opportunity to cure such failure;
(iv) By Shareholder if there is a material breach of any
representation or warranty set forth in Article 5 hereof or of any
covenant or agreement to be complied with or performed by Purchaser
pursuant to the terms of this Agreement; provided that Shareholder
may not terminate this Agreement prior to the Closing if Purchaser
has not had an adequate opportunity to cure such failure.
(b) In the Event of Termination. In the event of termination of this
Agreement;
(i) Each party will redeliver all documents, work papers and
other material of any other party relating to the transactions
contemplated hereby, whether so obtained before or after the
execution hereof to the party furnishing the same;
(ii) The provisions of Section 9.6 shall continue in full force
and effect; and
29
31
(iii) No party hereto shall have any liability or further
obligation to any other party relating to the transactions contemplated hereby,
provided that no such termination shall relieve any party from liability for a
willful breach of this Agreement.
10.2. Assignment. Neither this Agreement, the Closing Agreements nor any
of the rights or obligations hereunder or thereunder may be assigned by any
party without the prior written consent of the other parties thereto, which
consent will not unreasonably be withheld; except that either party may assign
all such rights and obligations to an Affiliate or to a successor in interest
which shall assume all obligations and liabilities of such party under this
Agreement (provided that no assignment shall release the assigning party from
responsibility for its obligations hereunder) and Purchaser may, without such
consent, assign all such rights to any lender as collateral security. Subject to
the foregoing, this Agreement shall be binding upon and inure to the benefit of
the parties hereto and their respective successors and permitted assigns, and no
other Person shall have any right benefit or obligation under this Agreement as
a third party beneficiary or otherwise.
10.3. Notices. All notices under this Agreement shall be in writing and
shall be deemed to have been duly given when received if personally delivered,
when transmitted if transmitted by telecopy, electronic or digital transmission
method provided that such transmission is confirmed by telephone; the day after
it is sent, if sent for next day delivery to a domestic address by overnight
mail; and upon receipt, if sent by certified or registered mail return receipt
requested. In each case notice shall be sent to:
If to Shareholder, addressed to:
Organon Teknika Corporation
000 Xxxx Xxxxxx
Xxxxxx X.X. 00000
Attention: President
With a copy to:
Organon Teknika X.X.
Xxxxxxx 00
0000 Xxxxxxxx
Xxxxxxx
Attention: General Counsel
30
32
If to Purchaser or the Company, addressed to:
Perlmmune, Inc.
0000 Xxxxxxx Xxxxx
Xxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx X. Xxxxx, Ph.D.
With a copy to:
Xxxxxx & Xxxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, X.X., Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxx X. Xxxxxxxxx
or to such other place and with such other copies as either party may designate
as to itself by written notice to the others.
10.4. Choice of Law. This Agreement shall be construed, interpreted and
the right of the parties determined in accordance with the internal law, and
not the law of conflicts, of the State of Maryland.
10.5. Entire Agreement; Amendments and Waivers. This Agreement, the
Closing Agreements, together with all exhibits and schedules hereto and
thereto, and the Purchase Price Note constitute the entire agreement among the
parties pertaining to the subject matter hereof and supersede all prior
agreements, understandings, negotiations and discussions, whether oral or
written, of the parties. This Agreement may not be amended or supplemented
except by an instrument in writing signed on behalf of each of the parties
hereto. No modification or waiver of this Agreement shall be binding unless
executed in writing by the party to be bound thereby. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of
any other provision hereof (whether or not similar), nor shall such waiver
constitute a continuing waiver unless otherwise expressly provided.
10.6. Multiple Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original but all of which
together shall constitute one and the same instrument.
10.7. Expenses. Except as otherwise specified in this Agreement, each
party hereto shall pay its own legal accounting, out-of-pocket and other
expenses incident to this Agreement and to any action taken by such party in
preparation for carrying this Agreement into effect.
10.8. Invalidity. In the event that any one or more of the provisions
contained in this Agreement or in any other instrument referred to herein,
shall, for any reason, be held to be invalid, illegal or unenforceable in any
respect, then to the maximum extent permitted by law, such
31
33
invalidity, illegality or unenforceability shall not affect any other provision
of this Agreement or any other such instrument.
10.9. Titles. The titles, captions or headings of the Articles and
Sections herein are inserted for convenience of reference only and are not
intended to be a part of or to affect the meaning or interpretation of this
Agreement.
10.10. Publicity. Any party issuing a press release regarding the
transactions contemplated hereby must have the prior written consent of the
other party.
10.11. Arbitration.
(a) Notwithstanding anything herein to the contrary, in the
event that there shall be a dispute among the parties after the Closing arising
out of or relating to this Agreement, including, without limitation, the
indemnities provided in Article 9 the parties agree to attempt to settle any
such disputes in a amicable manner. Should the parties fail to resolve such a
dispute within three (3) months following written notice thereof, such dispute
shall, upon request of the contesting party, be submitted to an arbitrator
jointly agreed to by the parties. If a single arbitrator cannot be agreed upon
within thirty (30) days, each party shall elect one arbitrator and the two
arbitrators will select a third arbitrator.
(b) Arbitration shall be conducted in accordance with rules
and procedures of the Center for Public Resources ("CPR"), subject to the
following terms:
(i) the arbitration shall be held at a mutually
agreeable location in the vicinity of Washington, D.C.
(ii) the arbitrator(s) shall be independent, impartial
third parties, having no direct or indirect personal or financial relationship
to any of the parties of the dispute, each of whom has agreed to accept an
appointment as arbitrator(s) on the terms set forth in this Section.
(iii) within thirty (30) days after the selection of the
arbitrator(s), each party shall submit a description of the matter to be
arbitrated to said arbitrator(s).
(iv) from the date the arbitrator(s) is/are in
possession of both parties' submitted material, the arbitrator(s) shall have
sixty (60) days in which to hear the parties and fifteen (15) days thereafter
to render a decision.
(v) time periods set forth in this Section 10.11 may be
altered only mutual consent of the parties.
(vi) the arbitrator(s) shall announce the award in
writing accompanied by written findings of facts in support of the award and
any relevant conclusions of law. Any award issued as a result of such
arbitration shall be final and binding
32
34
between the parties thereto, and shall be enforceable by any court
having jurisdiction over the party against whom enforcement is sought.
(vii) the fees of the arbitrator(s) and any other costs and fees
associated with the arbitration shall be paid in accordance with the
decision of the arbitrator(s), except that the prevailing party shall
pay no more than one-half of such costs.
10.12. Assets Held for Shareholder and Affiliates. Purchaser hereby
acknowledges and agrees that all biological materials, products, technology,
files, records and documentation, including but not limited to data for
regulatory purposes, relating to (i) the XXXX(R)BCG product line (including but
not limited to the master seed lot) (ii) any and all food diagnostics and HIV
diagnostics in the possession of the Company at the Closing Date and (iii) any
and all cell lines/antibodies set forth on Schedule 1.1(a) are the property of
Shareholders and/or its Affiliates and will not be deemed included in the Owned
Assets or the Transferred Assets.
10.13. Non-Competition. Taking into consideration that prior to the
Closing, the Company has been engaged in the manufacture and development of
food diagnostics and HIV diagnostics on behalf and for the account of
Shareholder and its Affiliates, and will under the Services Agreement continue
to provide services to the Shareholder and its Affiliates relating thereto,
Purchaser hereby covenants and agrees that Purchaser either directly or through
an Affiliate including the Company, will for the longer of (i) a period of five
(5) years from the Closing Date or (ii) as long as the Company continues to
provide services to the Shareholder or its Affiliates in the field of food
diagnostics or HIV diagnostics, not compete with Shareholder or its Affiliates
in the field of food diagnostics and/or HIV diagnostics, as appropriate.
33
35
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first written above.
PERIMMUNE HOLDINGS, INC.
By:/s/ XXXXXXX X. XXXXX XX.
---------------------------
Name: Xxxxxxx X. Xxxxx Xx.
Title: President
ORGANON TEKNIKA CORPORATION
By:
-----------------------------
Name:
Title:
36
IN WITNESS WHEREOF, the parties hereto have executed this Agreement
as of the day and year first written above.
PERIMMUNE HOLDINGS, INC.
By:
---------------------------
Name:
Title:
ORGANON TEKNIKA CORPORATION
By: /s/ XXXXXX X. XXXXXXX
-----------------------------
Name: X.X. Xxxxxxx
Title: President
