Exhibit 2.11
================================================================================
CONTRIBUTION AGREEMENT
dated as of December 22, 2006
among
INVERNESS MEDICAL SWITZERLAND GMBH,
PROCTER & XXXXXX INTERNATIONAL OPERATIONS, SA
and
IMJV GMBH
================================================================================
TABLE OF CONTENTS
PAGE
----
ARTICLE 1 FORMATION AND CONTRIBUTIONS.................................... 2
Section 1.1 Formation of the Company.................................. 2
Section 1.2 Transfer of the Contributed CD Business................... 2
Section 1.3 Excluded Assets........................................... 4
Section 1.4 Assumption of Liabilities................................. 6
Section 1.5 Liabilities Not Assumed by the Company.................... 7
Section 1.6 Shares.................................................... 9
Section 1.7 Post-Closing Working Capital Adjustment................... 9
ARTICLE 2 CLOSING........................................................ 10
Section 2.1 Closing................................................... 10
Section 2.2 Closing Deliveries........................................ 10
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF IMS AND IMA................. 12
Section 3.1 Organization and Existence............................... 12
Section 3.2 Power and Authority; Binding Agreement................... 12
Section 3.3 Noncontravention......................................... 12
Section 3.4 Compliance with Laws..................................... 13
Section 3.5 Governmental Licenses.................................... 14
Section 3.6 Financial Statements..................................... 14
Section 3.7 Absence of Changes or Events............................. 15
Section 3.8 Undisclosed Liabilities.................................. 15
Section 3.9 Assets other than Real Property.......................... 16
Section 3.10 [Reserved]............................................... 16
Section 3.11 Contracts................................................ 16
Section 3.12 Intellectual Property.................................... 18
Section 3.13 Legal Proceedings........................................ 21
Section 3.14 Tax Matters.............................................. 21
Section 3.15 Insurance................................................ 22
Section 3.16 Benefit Plans............................................ 22
Section 3.17 Employee and Labor Matters............................... 23
Section 3.18 Environmental Matters.................................... 23
Section 3.19 Transactions with Affiliates............................. 25
Section 3.20 Certain Business Practices............................... 25
Section 3.21 Regulatory Compliance.................................... 25
Section 3.22 Product Liability Claims; Product Recalls................ 27
Section 3.23 Product Registrations.................................... 27
Section 3.24 Purchase for Investment.................................. 27
Section 3.25 Brokers' Fees............................................ 28
ARTICLE 4 COVENANTS...................................................... 28
Section 4.1 Filings.................................................. 28
Section 4.2 Access and Investigation................................. 28
Section 4.3 Conduct of Business...................................... 29
i
Section 4.4 Commercially Reasonable Efforts.......................... 31
Section 4.5 Public Announcements..................................... 31
Section 4.6 Enforcement.............................................. 32
Section 4.7 Inventory................................................ 32
Section 4.8 Transfer................................................. 32
Section 4.9 Further Assurances....................................... 32
Section 4.10 Accounts Receivable...................................... 32
Section 4.11 Expenses................................................. 33
Section 4.12 Confidentiality.......................................... 33
Section 4.13 [Reserved]............................................... 33
Section 4.14 Preparation for Transition............................... 33
Section 4.15 Other Subsidiaries....................................... 33
Section 4.16 Compliance with Contractual Obligations.................. 33
Section 4.17 Issuance of Shares....................................... 33
Section 4.18 Unipath Purchase......................................... 34
ARTICLE 5 TAX MATTERS.................................................... 34
Section 5.1 Cooperation............................................... 34
Section 5.2 Apportioned Obligations................................... 34
Section 5.3 Transfer Taxes............................................ 34
Section 5.4 Tax Payments.............................................. 35
Section 5.5 Transaction Treated as a Contribution..................... 35
ARTICLE 6 CONDITIONS TO CLOSING.......................................... 35
Section 6.1 Conditions to Each Party's Obligation..................... 35
Section 6.2 Conditions to the Company's Obligations................... 36
Section 6.3 Conditions to IMS's Obligation............................ 37
ARTICLE 7 INDEMNIFICATION................................................ 38
Section 7.1 Indemnification of PGIO................................... 38
Section 7.2 Indemnification of IMS.................................... 39
Section 7.3 Indemnification Claims.................................... 39
Section 7.4 Survival.................................................. 41
Section 7.5 Sole and Exclusive Remedy................................. 41
ARTICLE 8 TERMINATION.................................................... 41
Section 8.1 Termination............................................... 41
Section 8.2 Effect of Termination..................................... 42
Section 8.3 Amendment................................................. 42
Section 8.4 Extension; Waiver......................................... 42
ARTICLE 9 GENERAL PROVISIONS............................................. 43
Section 9.1 Notices................................................... 43
Section 9.2 Definitions............................................... 44
Section 9.3 Descriptive Headings; Certain Interpretations............. 49
Section 9.4 Assignment................................................ 49
Section 9.5 Specific Enforcement...................................... 49
ii
Section 9.6 Entire Agreement.......................................... 49
Section 9.7 No Third-Party Beneficiaries.............................. 49
Section 9.8 Counterparts.............................................. 50
Section 9.9 Governing Law............................................. 50
Section 9.10 Arbitration.............................................. 50
Section 9.11 Severability............................................. 51
Section 9.12 Nonassignable Contracts.................................. 51
iii
INDEX OF DEFINED TERMS
--A--
Accounts Receivable....................................................... 2
Affiliate................................................................. 44
Agreement................................................................. 1
Apportioned Obligations................................................... 34
Arbitration Request....................................................... 50
Assignment and Assumption Agreement....................................... 10
Assumed Accounts Payable.................................................. 6
Assumed Liabilities....................................................... 6
--B--
Benefit Plans............................................................. 22
Bond Indenture............................................................ 36
Business Contract......................................................... 44
Business Contributed Intellectual Property................................ 4
Business Day.............................................................. 44
Business Intellectual Property............................................ 18
Business Registered Intellectual Property................................. 44
--C--
CD Business............................................................... 1
CD Financial Statements................................................... 15
Claim Notice.............................................................. 39
Closing................................................................... 10
Closing Date.............................................................. 10
Closing Date Balance Sheet................................................ 9
COBRA..................................................................... 23
Code...................................................................... 44
Company................................................................... 1
Constitutive Documents.................................................... 44
Contingent Obligation..................................................... 44
Contract.................................................................. 45
Contributed Assets........................................................ 2
Contributed CD Business................................................... 1
Contributed Inventory..................................................... 2
Contributed Leases........................................................ 2
Control................................................................... 45
Controlled................................................................ 45
--D--
Determination Date........................................................ 10
Distribution Agreement.................................................... 2
--E--
Environmental Law......................................................... 45
Environmental Liability................................................... 45
Environmental Permits..................................................... 45
ERISA..................................................................... 22
Exchange Act.............................................................. 13
Excluded Assets........................................................... 4
Excluded Businesses....................................................... 5
Excluded Contracts........................................................ 5
Excluded Liabilities...................................................... 7
--F--
FDA....................................................................... 13
FDCA...................................................................... 25
Finished Product Purchase Agreement....................................... 2
--G--
GAAP...................................................................... 14
General Limitations....................................................... 12
Governmental Entity....................................................... 45
Governmental Licenses..................................................... 3
Guarantee................................................................. 1
--H--
Hazardous Materials....................................................... 45
House Marks............................................................... 5
HSR Act................................................................... 13
--I--
IMA....................................................................... 1
IMA Audited Financial Statements.......................................... 14
IMA Balance Sheet Date.................................................... 14
IMA Facilities............................................................ 46
IMA Financial Statements.................................................. 14
IMA Indemnified Party..................................................... 39
IMA Indemnity Threshold................................................... 39
IMA Interim Balance Sheet................................................. 14
IMA Unaudited Financial Statements........................................ 14
IMS....................................................................... 1
Indebtedness.............................................................. 46
Indemnified Party......................................................... 46
Indemnifying Party........................................................ 46
Intellectual Property..................................................... 46
IP License Agreement...................................................... 11
IP Liens.................................................................. 18
IRS....................................................................... 22
--J--
Judgment.................................................................. 13
--K--
Knowledge................................................................. 47
--L--
Labeling.................................................................. 26
Law....................................................................... 13
iv
Legal Proceeding.......................................................... 7
Legal Restraints.......................................................... 35
Lien...................................................................... 13
Losses.................................................................... 47
--M--
Material Adverse Effect................................................... 47
Most Recent Balance Sheet................................................. 15
Most Recent Balance Sheet Date............................................ 15
--N--
Nonassignable Contract.................................................... 51
--O--
Ordinary Course of Business............................................... 15
Outside Date.............................................................. 41
--P--
Permitted IP Liens........................................................ 47
Permitted Liens........................................................... 47
Person.................................................................... 48
PGIO...................................................................... 1
PGIO Indemnified Party.................................................... 38
Post-Closing Tax Period................................................... 34
Product................................................................... 48
Product Registrations..................................................... 27
Purchase Agreement........................................................ 1
Purchased Asset........................................................... 48
Purchased CD Business..................................................... 1
--R--
Representatives........................................................... 48
Restructuring............................................................. 1
Returned Inventory........................................................ 32
--S--
Scheduled Contracts....................................................... 16
Securities Act............................................................ 27
Share..................................................................... 48
Shareholder Agreement..................................................... 1
Shareholders.............................................................. 48
Subsidiary................................................................ 48
--T--
Tax....................................................................... 48
Tax Return................................................................ 48
Third Party Claim......................................................... 48
Trademarks................................................................ 48
Transaction Agreements.................................................... 48
Transfer.................................................................. 2
Transfer Taxes............................................................ 34
Transferred Employee...................................................... 49
Transition Services Agreement............................................. 11
--W--
Working Capital........................................................... 9
Working Capital Target.................................................... 9
v
CONTRIBUTION AGREEMENT, dated as of December 22, 2006 (this
"Agreement"), among Inverness Medical Switzerland GmbH, a Swiss
company ("IMS"), Procter & Xxxxxx International Operations, SA, a
Swiss company ("PGIO") and IMJV GmbH, a Swiss company (the "Company").
INTRODUCTION
IMS formed the Company on December 19, 2006. On the Closing Date,
PGIO, IMS and the Company will enter into a shareholder agreement in a form to
be mutually agreed upon (the "Shareholder Agreement"), which shall establish the
respective rights and obligations of PGIO and IMS with respect to the Company.
IMS, Inverness Medical Innovations, Inc. ("IMA") and certain of their
Affiliates are in the business of developing, manufacturing, marketing, selling
and distributing human diagnostics and monitoring products for sale and
distribution through over-the-counter channels, including retail outlets and
emerging channels located in such retail outlets (the "CD Business").
Prior to the Closing Date, IMA and certain of its Subsidiaries
(including IMS) will restructure (the "Restructuring") their businesses.
IMS and its Affiliates contemplate selling certain assets and
contributing certain assets and liabilities of the CD Business, other than
assets used in, and liabilities arising from, the Excluded Fields (as defined in
the License Agreement).
On the Closing Date and subject to the terms set forth in this
Agreement (including with respect to the Excluded Assets and Excluded
Liabilities), IMS will contribute to the Company assets of the CD Business, and
the Company will assume certain liabilities of the CD Business, in each case, as
set forth in this Agreement (the "Contributed CD Business").
Concurrently with the execution of this Agreement, PGIO is entering
into an Asset Purchase Agreement (the "Purchase Agreement") with IMS, pursuant
to which PGIO will purchase from IMS assets of the CD Business (the "Purchased
CD Business") on terms and conditions set forth in the Purchase Agreement. Such
purchase and sale will be consummated concurrently with the Closing hereunder,
and simultaneously with the Closing, PGIO will contribute the Purchased CD
Business into the Company pursuant to the PGIO Contribution Agreement (as
defined in the Purchase Agreement).
On the Closing Date, IMA will execute a guarantee (the "Guarantee")
pursuant to which IMA guarantees all of IMS' obligations under this Agreement
and the Purchase Agreement.
As a consideration for the contribution of the Contributed CD Business
by IMS to the Company, IMS will receive one quota (one Share representing, as of
the Closing, 50% of the Company's outstanding Shares). As a consideration for
the contribution by PGIO of the Purchased CD Business to the Company, PGIO will
receive one quota (one Share representing, as of the Closing, 50% of the
Company's outstanding Shares).
1
On the Closing Date, the Company and IMA and certain of its
Subsidiaries will enter into a mutually agreeable finished product purchase
agreement (the "Finished Product Purchase Agreement"), pursuant to which IMA
and/or such Subsidiaries will manufacture and sell to the Company the products
described therein.
On the Closing Date, the Company and certain Affiliates of PGIO will
enter into distribution and commissionaire arrangements pursuant to which such
Affiliates of PGIO will distribute and act as sales agents for products of the
Company (collectively, the "Distribution Arrangements").
Capitalized terms shall have the meanings assigned to them in Section
9.2 or as otherwise provided in this Agreement.
In consideration of the foregoing and the respective representations,
warranties, covenants and agreements set forth herein, the parties hereto agree
as follows:
ARTICLE 1
FORMATION AND CONTRIBUTIONS
Section 1.1 Formation of the Company. Prior to the date hereof, IMS
has formed the Company and has made an initial contribution of CHF 20,000.00 to
capital of the Company in exchange for 100% of the outstanding Shares of the
Company.
Section 1.2 Transfer of the Contributed CD Business. Except for the
Excluded Assets as provided in Section 1.3 and without duplication of the
Purchased CD Business, at the Closing and with effect as of the Closing Date,
IMS shall assign, transfer, convey and deliver to the Company, free and clear of
all Liens except Permitted Liens (the "Transfer"), and the Company shall acquire
from IMS, all of the right, title and interest of IMS in and to any and all of
the assets, properties, rights and business of the Contributed CD Business of
every kind, nature, type and description, real, personal and mixed, tangible and
intangible, whether known or unknown, fixed or unfixed, or otherwise, whether or
not specifically referred to in this Agreement and whether or not reflected on
the books and records of IMS (collectively, the "Contributed Assets"), including
the following:
(i) all accounts receivable, and notes receivable (if any), of any
nature arising from the Contributed CD Business existing on the Closing
Date (the "Accounts Receivable");
(ii) all supplies and finished goods, including goods in transit, as
sold, used or held for use as part of the Contributed CD Business (the
"Contributed Inventory");
(iii) all tangible assets, furniture, fixtures and property, if any,
used by the Transferred Employees upon the hiring of such Transferred
Employees;
(iv) the Business Contracts (other than Excluded Contracts);
(v) all licenses, registrations, notifications, franchises,
qualifications, provider numbers, permits, approvals, clearances and
authorizations issued by any Governmental
2
Entity that relate to the Contributed CD Business or the Contributed Assets
(the "Governmental Licenses"), in each case to the extent transferable or
assignable and subject to IMA retaining such of the foregoing as are
necessary for IMA and/or certain of its Subsidiaries to fulfill their
respective obligations under the Finished Product Purchase Agreement;
provided that such licenses, registrations, notifications, franchises,
qualifications, provider numbers, permits, approvals, clearances and
authorizations as then in existence shall be transferred to the Company
following termination or expiration of the Finished Product Purchase
Agreement, in each case to the extent transferable or assignable;
(vi) all lists, documents, records, written information, computer
files and other computer readable media concerning present customers, and
to the extent reasonably available, past and potential customers, of goods
or services arising from or used in the Contributed CD Business;
(vii) all lists, documents, records, written information, computer
files and other computer readable media concerning present suppliers and
vendors of goods or services, and to the extent reasonably available, past
and potential suppliers and vendors, arising from or used in the
Contributed CD Business, excluding any such lists, records, written
information, computer files and other media concerning suppliers and
vendors whose goods and services will be used by IMA and its Subsidiaries
in the performance of their obligations under the Finished Product Purchase
Agreement; provided that such lists, records, written information, computer
files and other media as then in existence shall be conveyed and delivered
to the Company following termination or expiration of the Finished Product
Purchase Agreement;
(viii) all product records, product data, correspondence with and to
customers of the CD Business, production records, contract files,
technical, accounting, and procedural manuals, studies, reports or
summaries relating to the general condition of the Contributed Assets, and
any confidential information which has been reduced to writing or
electronic form, to the extent that any of the foregoing relate to or arose
from the Contributed CD Business;
(ix) all rights under express or implied warranties from the suppliers
and vendors relating to or arising out of the operation of the Contributed
CD Business, except for such rights arising out of or relating to the
manufacturing of any product of the CD Business;
(x) to the extent related to an Assumed Liability, all claims,
warranties, guarantees, refunds, causes of action, rights of recovery,
rights of set-off and rights of recoupment of any kind and nature;
(xi) all currently outstanding unfilled purchase orders and proposals
received for the purchase of inventory of the Contributed CD Business;
(xii) except for those Trademarks set forth in Section 3.12(a) of the
Disclosure Schedule as registered in the name of IMS, which will be
assigned, transferred and
3
conveyed pursuant to the Purchase Agreement and the PGIO Contribution
Agreement, all (A) Intellectual Property owned by IMS or any of its
Affiliates that are exclusively used in the CD Business, and (B) Trademarks
(other than House Marks) owned by IMS or IMA or any of their respective
Subsidiaries that are not presently exclusively used by the CD Business or
any other business of IMS or such Affiliate but that were exclusively used
by the CD Business in the past, in each case including the Business
Registered Intellectual Property (the "Business Contributed Intellectual
Property");
(xiii) to the extent assignable, all rights under any non-disclosure
agreements, non-solicitation agreements and non-competition agreements
entered into with any parties, to the extent that any of the foregoing
relates to or arose from the Contributed CD Business;
(xiv) all prepaid expenses and other deposits related to the
Contributed CD Business;
(xv) all rights and claims, including refunds, to the extent that such
rights and claims relate to or arose from the Contributed CD Business;
(xvi) all insurance policies (to the extent separable and assignable)
with respect to the CD Business, and rights, benefits, claims and proceeds
thereunder arising from or relating to the Assumed Liabilities;
(xvii) all other tangible assets or movable property used in
connection with the Contributed CD Business, if any; and
(xviii) all goodwill relating to the foregoing.
Section 1.3 Excluded Assets. Notwithstanding the provisions of Section
1.2, the parties hereto acknowledge and agree that the following are not
included among either the Contributed Assets or the Purchased Assets (as defined
in the Purchase Agreement) and are excluded from the Transfer (collectively, the
"Excluded Assets"):
(i) the assets, properties, Contracts and rights of IMS and its
Affiliates in the Excluded Fields (which shall include, for the avoidance
of doubt, the tangible assets and real property located at Stirling,
Scotland) and the Intellectual Property of IMS and its Affiliates in the
Excluded Fields;
(ii) (A) Intellectual Property owned by third parties and licensed to
IMS or one of its Affiliates for use in the CD Business and which are
listed in Section 1.3(ii) of the Disclosure Schedule, (B) Intellectual
Property, other than Trademarks, not used exclusively in the CD Business,
and (C) Trademarks that have never been at any time exclusively used in the
CD Business (other than Trademarks that have been held for use in the CD
Business but have never been used by any business);
(iii) the assets, properties, Contracts and rights of IMS and its
Affiliates (including vendor and supplier contracts, information, files and
data) used in the manufacturing of the products of the CD Business,
including all tangible assets,
4
properties, and contracts of IMS' or its Affiliates' manufacturing
facilities located in Bedford, England, Hangzhou, People's Republic of
China ("PRC") and Shanghai, PRC, excluding any product specifications,
product registrations or similar assets used in the conduct of the CD
Business;
(iv) the assets, properties, Contracts and rights arising from or used
in IMA and their Subsidiaries' professional diagnostics and nutritional
supplement businesses (collectively, the "Excluded Businesses");
(v) the Contracts arising from the CD Business set forth on Section
1.3(v) of the Disclosure Schedule (the "Excluded Contracts");
(vi) the Trademarks or trade names "Inverness", and any variants
thereof that include "Inverness", internet domain names that include
"Inverness", and the Inverness "little man" logo (collectively, the "House
Marks");
(vii) real property, buildings, structures and improvements thereon,
whether owned or leased by IMS or its Affiliates, and all fixtures and
fittings attached thereto, including all manufacturing, distribution and
administration facilities of IMS and its Affiliates;
(viii) rights to refunds of Taxes paid by or on behalf of IMS or any
of its Affiliates (other than those paid by the Company), except for the
rights to refunds of Taxes that constitute Assumed Liabilities or refunds
accrued on the Closing Date Balance Sheet;
(ix) except as provided in Section 1.2(xvi), insurance policies and
rights and benefits and claims thereunder;
(x) tangible assets, properties, Contracts and Intellectual Property
of IMA or its Subsidiaries (including animals and cell lines) used in the
manufacturing, production and storage of reagents and other biological
materials used in the CD Business;
(xi) all inventory (including raw materials and work-in-process of IMA
and IMS), wherever located, other than the Contributed Inventory;
(xii) the services of any employees of IMA or its Subsidiaries (except
for Transferred Employees upon hiring of such Transferred Employee by the
Company or a Subsidiary of the Company) or assets of any employee benefit
plan, arrangement, or program maintained or contributed to by IMA or any of
its Subsidiaries with respect to any employees other than Transferred
Employees (upon the hiring of such Transferred Employee by the Company or a
Subsidiary of the Company); and
(xiii) any other assets, tangible or intangible, wherever situated,
not included in the Contributed Assets, including those used in the
Excluded Businesses;
provided that IMS and its Affiliates, upon reasonable request and to the extent
IMS or any of its Affiliates has the right to so provide, will provide the
Company reasonable access during normal
5
business hours to the Excluded Assets that, prior to the Closing Date, were used
in the CD Business and are not being transferred pursuant to this Agreement or
the Purchase Agreement, for the Company's use to facilitate its manufacturing
and research and development activities; provided, further, that with respect to
access to the Bedford, England, Hangzhou, PRC or Shanghai, PRC manufacturing
facilities, the terms of the Finished Products Purchase Agreement shall control
and this provision shall not expand the rights set forth therein.
Section 1.4 Assumption of Liabilities. At the Closing, the Company
shall assume, and shall agree to pay, perform and discharge according to their
respective terms (if any), the following (and only the following) liabilities
and obligations of IMS and its Affiliates arising primarily from or related
primarily to the Contributed CD Business, and no other liabilities or
obligations of IMS or its Affiliates (liabilities to be assumed by the Company
pursuant to this Section 1.4 being collectively referred to as the "Assumed
Liabilities"):
(i) all obligations of IMS or its Affiliates under the Business
Contracts (other than Excluded Contracts) that are part of the Contributed
CD Business that, by the terms of such Business Contracts, arise after the
Closing Date, relate to periods following the Closing Date and are to be
observed, paid, discharged, or performed, as the case may be, in each case
at any time after the Closing Date;
(ii) all unpaid liabilities and obligations, including trade accounts
payable, of the Contributed CD Business (but excluding all payables to IMS
or any of its Affiliates), incurred in the Ordinary Course of Business and
other similar current liabilities of the Contributed CD Business as may be
included in the calculation of Working Capital under Section 1.7 hereof
(collectively, the "Assumed Accounts Payable");
(iii) any product warranty, product liability or product returns,
rebates, coupons, allowances or other discounting and promotional
commitments arising from any product line produced or sold by the
Contributed CD Business that has not been discontinued prior to the date
hereof;
(iv) any product warranty, product liability or product returns,
rebates, coupons, allowances or other discounting and promotional
commitments arising from any product line that has been discontinued prior
to the date hereof by the Contributed CD Business, only to the extent of
any contingency reserve related thereto on the Closing Date Balance Sheet;
(v) any liability, obligation or expense of any kind or nature
relating to Taxes (other than corporate Taxes based upon the income of such
entity), including sales and value added taxes, owed by IMS or any of its
Affiliates (including any contractual liability with respect to Taxes of
another Person) arising from the conduct of the Contributed CD Business, to
the extent as included in the calculation of Working Capital under Section
1.7; provided that Transfer Taxes and Apportioned Obligations shall be paid
in the manner set forth in Sections 5.2 and 5.3 hereof;
(vi) except as set forth in Section 1.4(vi) of the Disclosure Schedule
and with respect to any matter involving Taxes, any liability, obligation,
cost or expense of IMS or
6
any of its Affiliates arising out of or relating to any investigation,
claim, action, suit, complaint, dispute, audit, demand, litigation or
judicial, administrative or arbitration proceeding (collectively, "Legal
Proceeding") as and to the extent it arose or arises from the Contributed
CD Business to which IMS or any of its Affiliates is or was a party whether
it relates to any time prior to, at or after the Closing (regardless of
whether the Legal Proceeding is commenced before or after the Closing), and
any contingency reserve related thereto;
(vii) upon hiring of a Transferred Employee by the Company or a
Subsidiary of the Company, any liability or obligation with respect to such
Transferred Employee including all liabilities for accrued vacation pay,
excluding any pension or similar liabilities;
(viii) any liability, obligation or expense arising from the Business
Contributed Intellectual Property after the Closing Date; and
(ix) any liability or obligation arising from the conduct of the
Contributed CD Business after the Closing Date.
Section 1.5 Liabilities Not Assumed by the Company. Notwithstanding
anything to the contrary in this Agreement, the Company shall not assume, or in
any way be liable or responsible for any, and IMS and its Affiliates shall pay,
perform and discharge all, obligations and liabilities of them, direct or
indirect, known or unknown, fixed or unfixed, xxxxxx or inchoate, liquidated or
unliquidated, secured or unsecured, accrued, absolute, contingent or otherwise,
except for the Assumed Liabilities (collectively, the "Excluded Liabilities")
and IMS shall hold the Company harmless with respect to the Excluded
Liabilities. For the avoidance of doubt, the term Assumed Liabilities does not
include any of the Excluded Liabilities and the term Excluded Liabilities
includes all liabilities and obligations of IMS or any of its Affiliates
(including without limitation liabilities and obligations imposed by operation
of law) other than the Assumed Liabilities. Without limiting the generality of
the foregoing, Excluded Liabilities shall include the following obligations and
liabilities:
(i) any liability or obligation of IMS or any of its Affiliates
arising from or relating to the Excluded Businesses, or the business, if
any, of such entities in the Excluded Fields;
(ii) any liability or obligation of IMS or any of its Affiliates
arising out of or in connection with the negotiation and preparation of
this Agreement or any of the other Transaction Agreements or the
consummation and performance of the transactions contemplated hereby and
thereby, including any liability for Taxes so arising;
(iii) any liability or obligation (other than Assumed Liabilities)
arising under, relating to or resulting from any asset of IMS or its
Affiliates other than the Contributed Assets and the Purchased Assets;
(iv) any liability or obligation of IMS of any of its Affiliates
arising (i) from their failure to perform, or negligent performance of,
their obligations under, or (ii) out of
7
or relating to any breach or claim of breach of a representation, warranty,
covenant or agreement of IMS or any of its Affiliates contained in, any of
the Business Contracts;
(v) except as provided in Section 1.4(v), any liability, obligation or
expense of any kind or nature relating to Taxes owed by IMS or any of its
Affiliates (including any contractual liability with respect to Taxes of
another Person); provided that Transfer Taxes and Apportioned Obligations
shall be paid in the manner set forth in Sections 5.2 and 5.3 hereof;
(vi) any liability or obligation to any of the directors, officers or
Affiliates of IMS;
(vii) except for Legal Proceedings assumed pursuant to Section
1.4(vi), any liability, obligation, cost or expense of IMS or any of its
Affiliates arising out of or relating to any Legal Proceeding to which IMS
or any of its Affiliates is or was a party and that relates to any time at
or prior to the Closing (regardless of whether the Legal Proceeding is
commenced before or after the Closing), and any contingency reserve related
thereto;
(viii) any liability or obligation of IMS or its Affiliates with
respect to any Indebtedness or Contingent Obligations (including any
accrued interest, fees and any penalties thereon);
(ix) any liability or obligation of IMS or its Affiliates to or with
respect to employees, former employees, consultants and former consultants
and Benefit Plans and other employee and employment-related liabilities,
including any liability for severance, incentive, bonus or other
compensation, health, welfare and other benefit plans of IMS or IMA or
their Subsidiaries whether arising prior to or after the Closing;
(x) any accounts payable other than the Assumed Accounts Payable;
(xi) any product warranty, product liability or product returns,
rebates, coupons, allowances or other discounting and promotional
commitments with respect to any product line of the CD Business that was
discontinued prior to the Closing Date, as and to the extent in excess of
any contingency reserve therefor on the Closing Date Balance Sheet;
(xii) any liability or obligation of IMS or its Affiliates arising out
of or relating to the failure of IMS or its Affiliates to obtain any
Governmental Licenses material to or necessary for the conduct of the CD
Business;
(xiii) any liability or obligation of IMS or its Affiliates arising
out of or relating to IMA Facilities under applicable Environmental Laws;
(xiv) any liability or obligation of IMS or its Affiliates to fund or
finance any pension or similar liabilities; and
8
(xv) all liabilities and obligations of IMS or its Affiliates under
this Agreement and the other Transaction Agreements.
Section 1.6 Shares. In consideration of the Transfer of the
Contributed Assets, together with any Working Capital adjustment payment
pursuant to Section 1.7, on the Closing Date, IMS shall receive one quota of the
Company (representing, as of the Closing, 50% of outstanding Shares of the
Company).
Section 1.7 Post-Closing Working Capital Adjustment.
(a) To the extent the Working Capital of the Company as of the
Closing, upon completion of the transactions contemplated by this Agreement and
the Purchase Agreement and including all assets and liabilities of the
Contributed CD Business and the Purchased CD Business is less than $22,300,000
(the "Working Capital Target"), IMS shall make an additional cash contribution
to the Company in the amount of such deficiency within five Business Days after
the Determination Date. "Working Capital" means those receivables and other
current assets (other than cash), including Contributed Inventory, that are
Purchased Assets and Contributed Assets less the accounts payable, accrued
expenses and other current liabilities that are Assumed Liabilities under this
Agreement and the Purchase Agreement.
(b) As promptly as practicable, but in no event later than 60 days
after the Closing Date, the Company shall cause to be prepared and furnished to
PGIO and IMS a balance sheet, certified by the Company's Chief Financial
Officer, for the Company as of the Closing Date (the "Closing Date Balance
Sheet"), including a computation of Working Capital as of such date and a
calculation of the additional cash contribution, if any, or cash payment, if
any, as the case may be, required pursuant to this Section 1.7 or under the
equivalent provision in the Purchase Agreement. The Closing Date Balance Sheet
shall be prepared in accordance with GAAP applied on a basis consistent with the
preparation of the Most Recent Balance Sheet.
(c) Each of IMS and its independent accountants and PGIO and its
independent accountants shall have the right for a period of 60 days after the
receipt of the Closing Date Balance Sheet to review the Closing Date Balance
Sheet and the working papers relating thereto and to present in writing to the
Company any objections in reasonable detail. The Company shall provide
reasonable access to the records, files and other information reasonably
requested by IMS and/or its independent accountants or by PGIO and/or its
independent accountants, including those used to prepare the Closing Date
Balance Sheet, as well as access to such personnel of the Company (and PGIO to
the extent such personnel were involved in the process described above) as IMS
and/or its independent accountants or PGIO and/or its independent accountants
may reasonably request. The Closing Date Balance Sheet shall be deemed to be
acceptable to IMS and PGIO, and shall become final and binding on all parties,
except to the extent that within such 60 day period IMS or PGIO shall have made
a written objection thereto, which objection shall specify in reasonable detail
the grounds for such objection. PGIO and IMS shall attempt in good faith to
resolve any dispute concerning the item or items subject to an objection raised
in accordance with this Section 1.7(c). If PGIO and IMS are unable to resolve
any such dispute within 30 days (or such longer period as they shall mutually
agree in writing), such dispute shall be resolved by an independent accounting
firm of national recognition mutually selected by PGIO and IMS acting as
arbitrator. Such
9
determination shall be final and binding on the parties, and judgment may be
entered thereon in any court having jurisdiction over the party against which
such determination is to be enforced. The date on which the Closing Date Balance
Sheet, together with the Working Capital computation therein, is deemed final
and binding is referred to as the "Determination Date". Only items specified in
the written objection shall be subject to adjustment by the independent
accounting firm. The fees and expenses of the independent accounting firm shall
be borne by PGIO and IMS in proportions inverse to the extent to which they
prevail in the dispute, with such allocations to be finally determined by the
accounting firm.
ARTICLE 2
CLOSING
Section 2.1 Closing. The closing of the transactions contemplated by
this Agreement (the "Closing") shall be held at the offices of Xxxxxxxxx &
Xxxxxxx LLP, 1330 Avenue of the Americas, New York, New York, at 10:00 a.m. on
the date as soon as practicable, and in any event not later than two Business
Days, following satisfaction of all conditions and taking of all other actions
(other than those that by their terms are to be satisfied or taken at the
Closing) set forth in Article 6 (or, to the extent permitted by Law, waived by
the parties hereto entitled to the benefits thereof), or on such other date, and
at such other time or place, as PGIO and IMA may mutually agree in writing. The
date on which the Closing occurs is referred to in this Agreement as the
"Closing Date".
Section 2.2 Closing Deliveries. (a) At the Closing, the Company shall
deliver or cause to be delivered to IMS and PGIO:
(i) a certified copy of the current extract from the commercial
register of the Company;
(ii) the Shareholder Agreement, executed by the Company;
(iii) a public deed evidencing that IMS is the legal owner of one
quota (representing, on the Closing Date, 50% of the Company's outstanding
Shares);
(iv) a public deed evidencing that PGIO is the legal owner of one
quota (representing, on the Closing Date, 50% of the Company's outstanding
Shares);
(v) a quota holders resolution approving the ownership as evidenced
per (iii) and (iv) above;
(vi) an assignment and assumption agreement (the "Assignment and
Assumption Agreement") reasonably satisfactory to PGIO, the Company and IMS
under which the Company assumes the Assumed Liabilities, executed by the
Company;
(vii) the Distribution Arrangements, executed by the Company;
(viii) the License Agreements, executed by the Company;
10
(ix) the Finished Products Purchase Agreement, (the "Finished Products
Purchase Agreement") in a form mutually agreed by the parties, executed by
the Company;
(x) a Transition Services Agreement (the "Transition Services
Agreement"), in a form mutually agreed by the parties, executed by the
Company;
(xi) the other Transaction Agreements to which the Company is a party;
and
(xii) (1) the exclusive trademark license agreement by US CD LLC to
the Company with respect to the U.S. Trademarks ACCU-CLEAR and ACCU-CLEAR
READY OR NOT, and (2) the license agreement among the Company, IMS and IMA,
each upon terms mutually agreed by the parties.
(b) At the Closing, IMS shall deliver or cause to be delivered to the
Company and PGIO:
(i) a cash contribution to the Company in the amount of $1,000,000;
(ii) the Shareholder Agreement, executed by IMS;
(iii) the Assignment and Assumption Agreement, executed by IMS;
(iv) the Intellectual Property license agreements in a form mutually
agreed by the parties (the "License Agreements"), executed by IMS and such
other Affiliates of IMS as set forth therein;
(v) the Finished Product Purchase Agreement in a form mutually agreed
by the parties, executed by certain Affiliates of IMS as set forth therein;
(vi) the Transition Services Agreement, executed by IMA and certain
Subsidiaries of IMA as set forth therein;
(vii) the other Transaction Agreements to which IMS or any of its
Affiliates is a party;
(viii) the Guarantee in a form reasonably acceptable to PGIO under
which IMA guarantees all of the obligations of IMS hereunder and under the
Purchase Agreement;
(ix) an instrument of sale or contribution in a form reasonably
satisfactory to PGIO transferring to the Company all of IMS and its
Affiliates' right, title and interest in and to the Contributed Assets; and
(x) such other bills of sale, endorsements, assignments and other
instruments of transfer, conveyance and assignment (in a form reasonably
satisfactory to PGIO) as shall be required by law or necessary in the
reasonable judgment of PGIO or the Company to transfer, convey and assign
the Contributed Assets to the Company.
11
(c) At the Closing, PGIO shall deliver or cause to be delivered to the
Company and IMS:
(i) a cash contribution to the Company in the amount of $1,000,000;
(ii) the Shareholder Agreement, executed by PGIO; and
(iii) other Transaction Agreements to which PGIO or any of its
Affiliates is a party.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF IMS AND IMA
IMS represents and warrants to the Company and PGIO as follows, as of
the date of this Agreement and as of the Closing:
Section 3.1 Organization and Existence. Each of IMS and the Company is
duly organized and validly existing under the Laws of Switzerland, has all
requisite power and authority to carry on the CD Business as now being conducted
and is duly qualified or licensed to do business and in good standing in each
jurisdiction in which the nature of the CD Business or the ownership, leasing or
operation of its properties makes such qualification or licensing necessary,
except for those jurisdictions where the failure to be so qualified or licensed
would not have a Material Adverse Effect. Other than wholly-owned Subsidiaries,
IMA has no Subsidiaries that conduct the CD Business or own Contributed Assets
other than Inverness Medical (Shanghai), Co., Ltd.
Section 3.2 Power and Authority; Binding Agreement. Each of IMS and
the Company has all requisite power and authority to execute and deliver this
Agreement, to consummate the transactions contemplated hereby and to perform its
respective obligations hereunder, and has, or on the Closing Date will have, the
requisite power and authority to enter into the Transaction Agreements and to
perform its respective obligations thereunder. This Agreement is a valid and
binding obligation of each of IMS and the Company, enforceable against each of
them in accordance with its terms, except as the same may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws affecting the
rights of creditors generally and subject to the rules of law governing (and all
limitations on) specific performance, injunctive relief and other equitable
remedies (the "General Limitations"). When executed, each other Transaction
Agreement will be the valid and binding obligation of each of IMS and the
Company enforceable against each of them in accordance with its terms, except as
the same may be limited by the General Limitations. Except as set forth in
Section 3.2 of the Disclosure Schedule, no other act, approval or proceedings on
the part of IMS or the Company is, or will be, required to authorize the
execution and delivery of this Agreement and the other Transaction Agreements or
the consummation of the transactions contemplated hereby and thereby.
Section 3.3 Noncontravention. (a) Except as set forth in Section
3.3(a) of the Disclosure Schedule, the execution and delivery by IMS or the
Company of this Agreement and the other Transaction Agreements to which either
of them is a party, and the consummation of the transactions contemplated hereby
and thereby and the compliance by either of them with the provisions hereof and
thereof do not and will not result in the creation of any lien, pledge, claim,
12
charge, mortgage, encumbrance or other security interest of any kind, whether
arising by Contract or by operation of Law (a "Lien"), in or upon any of the
properties or assets of IMS or its Affiliates that are material to the conduct
of the CD Business. Except as set forth in Section 3.3(a) of the Disclosure
Schedule, the execution and delivery by IMS or the Company of this Agreement and
the other Transaction Agreements to which either of them is a party, and the
consummation of the transactions contemplated hereby and thereby and the
compliance by either of them with the provisions hereof and thereof do not and
will not (i) conflict with or result in any violation or default (with or
without notice or lapse of time or both) under, (ii) give rise to a right of, or
result in, termination or cancellation of, or acceleration of any obligation
under, (iii) result in a loss of a material benefit under, or (iv) give rise to
any increased, additional, accelerated or guaranteed rights or entitlements
under, any provision of (A) the Constitutive Documents of IMS or the Company,
(B) any material Business Contract to which IMS or any of its Affiliate or the
Company is a party or is bound by, or any Contributed Assets are bound by or
subject, or under which IMS or any of its Affiliates or the Company has material
rights or benefits or (C) subject to the governmental filings and other matters
referred to in Section 3.3(b), any constitution, act, statute, law (including
common law), ordinance, treaty, rule or regulation of any Governmental Entity (a
"Law") or any judgment, order or decree (a "Judgment"), in each case applicable
to IMS or any of its Affiliates or the Contributed Assets or the Purchased
Assets, or the Company.
(b) No consent, approval, license, permit, order or authorization of,
registration, declaration or filing with, or notice to, any Governmental Entity
is required by or with respect to IMS or the Company in connection with the
execution and delivery of this Agreement, the other Transaction Agreements, the
consummation of the transactions contemplated hereby or thereby or the
compliance by IMS or the Company with the provisions hereof and thereof, except
(i) for filings required under, and compliance with other applicable
requirements of, the Xxxx Xxxxx Xxxxxx Antitrust Improvements Act of 0000 (xxx
"XXX Xxx"), and any similar competition filing with any Governmental Entity, if
applicable to this Agreement, the other Transaction Agreements and the
transactions contemplated hereby and thereby; (ii) the filing with the SEC of
such reports under the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), as may be required in connection with this Agreement and the
other Transaction Agreements and the transactions contemplated hereby and
thereby; (iii) filings with, and notices and submissions to, the United States
Food and Drug Administration (the "FDA"); (iv) such filings as may be required
to transfer the ownership of Intellectual Property rights and (v) such other
consents, approvals, orders, authorizations, registrations, declarations,
filings and notices, the failure of which to be obtained or made individually or
in the aggregate would not impair in any material respect the ability of IMS or
the Company to perform its obligations under this Agreement or prevent or
materially impede or delay the consummation of the transactions contemplated
hereby.
Section 3.4 Compliance with Laws. Except as set forth in Section 3.4
of the Disclosure Schedule, IMS and its Affiliates are in compliance in all
material respects with all applicable Laws and Judgments. Except as set forth in
Section 3.4 of the Disclosure Schedule, since January 1, 2004 neither IMS nor
any of its Affiliates has received a written notice from a Governmental Entity
alleging a possible violation by it of any applicable Law or Judgment applicable
to the CD Business. Notwithstanding the foregoing, this Section 3.4 shall not
constitute a representation or warranty as to intellectual property, tax,
employee benefit plan,
13
environmental or the specific regulatory matters covered in Sections 3.21, 3.22
and 3.23 which are limited to those representations and warranties set forth in
Sections 3.12, 3.14, 3.16, 3.17, 3.18, 3.21, 3.22 and 3.23, respectively.
Section 3.5 Governmental Licenses. IMS and its Affiliates validly hold
and have in full force and effect all Governmental Licenses that are material to
the conduct of the CD Business, and neither IMS nor any of its Affiliates is in
violation (other than an immaterial violation) of, or default (with or without
notice or lapse of time or both) (other than an immaterial default) under, or
event giving to any other Person any right of termination, amendment or
cancellation of, any Governmental License material to the conduct of the CD
Business. Each of IMS and its Affiliates is in compliance in all material
respects with the terms and conditions of all Governmental Licenses issued to or
held by it that are material to the CD Business, and such Governmental Licenses
will not be subject to suspension, modification, revocation or nonrenewal as a
result of the execution and delivery of this Agreement or the other Transaction
Agreements or the consummation of the transactions contemplated hereby and
thereby. No proceeding is pending or, to the Knowledge of IMS or IMA, threatened
seeking the revocation or limitation of any Governmental License that is
material to the conduct of the CD Business. Section 3.5 of the Disclosure
Schedule lists each Governmental License held by IMS or its Subsidiaries that is
material to the conduct of the CD Business, except for any licenses related to,
or necessary for, the manufacture or storage of the products of the CD Business.
Except as set forth therein, all of the Governmental Licenses listed in Section
3.5 of the Disclosure Schedule are held in the name of IMS or its Affiliates,
and none are held in the name of any current or former director, officer,
employee, independent contractor or consultant of IMS or its Affiliates or
agents or otherwise on behalf of IMS or its Affiliates. Except for those
Governmental Licenses retained pursuant to Section 1.2(v) hereof in order to
perform the obligations under the Finished Products Purchase Agreement or as set
forth in Section 3.5 of the Disclosure Schedule, all Governmental Licenses that
are material to the conduct of the CD Business are transferable to the Company.
Notwithstanding the foregoing, this Section 3.5 shall not constitute a
representation or warranty as to the specific regulatory matters covered in
Sections 3.21 and 3.23.
Section 3.6 Financial Statements. (a) Section 3.6(a) of the Disclosure
Schedule refers to the audited consolidated balance sheets of IMA as of December
31, 2005 (the "IMA Balance Sheet Date"), and December 31, 2004 and audited
statements of income and cash flows of IMA for each of the fiscal years ending
on such dates, together with any notes thereto and accountant's reports thereon
(collectively, the "IMA Audited Financial Statements"), and the unaudited
consolidated balance sheet of IMA (the "IMA Interim Balance Sheet") as of
September 30, 2006 and the unaudited statement of income of IMA for the period
ending on such date (collectively, the "IMA Unaudited Financial Statements" and
together with the IMA Audited Financial Statements, the "IMA Financial
Statements"). Except as disclosed in Section 3.6(a) of the Disclosure Schedule,
the IMA Financial Statements fairly present, in all material respects, the
consolidated financial position and results of operations and cash flows of IMA
for the periods and as of the dates referred to in the IMA Financial Statements,
all in accordance with United States generally accepted accounting principles,
consistently applied ("GAAP") (except, in the case of the IMA Unaudited
Financial Statements, for the absence of footnotes and normal year-end
adjustments that are not material individually or in the aggregate). The IMA
Financial Statements are consistent in all material respects with the books and
records of IMA, subject, in
14
the case of the IMA Unaudited Financial Statements, to normal year-end
adjustments that are not material individually or in the aggregate.
(b) Section 3.6(b) of the Disclosure Schedule sets forth the unaudited
pro forma balance sheet (the "Most Recent Balance Sheet") of CD Business as of
September 30, 2006 (the "Most Recent Balance Sheet Date"), and the unaudited pro
forma statements of revenues and direct expenses of the CD Business for the
period then ended (the financial statements collectively, the "CD Financial
Statements"). Except as set forth in Section 3.6(b) of the Disclosure Schedule,
the CD Financial Statements (i) are consistent with the books and records of IMS
and IMA, (ii) have been prepared in accordance with GAAP and (iii) present
fairly the pro forma financial condition, results of operations of the CD
Business as of the respective dates thereof and for the periods referred to
therein, subject to normal year-end adjustments that are not material
individually or in the aggregate.
(c) All Accounts Receivable (net of any reserves) are current and
arose from valid transactions in the ordinary course of business consistent with
past practice (the "Ordinary Course of Business") with unrelated third parties,
except as otherwise identified on the Most Recent Balance Sheet. Except as set
forth in Section 3.6(c) of the Disclosure Schedule, neither IMS nor any of its
Affiliates has received notice or other indication that any of the Accounts
Receivable will not be collectible in full, net of any reserves. Nothing
contained in this representation shall be construed as a guaranty of the
complete collectibility of all Accounts Receivable.
(d) All of the Contributed Inventory whether or not shown on the Most
Recent Balance Sheet, net of any reserves shown thereon, consists of a quality
and quantity usable and salable in the Ordinary Course of Business, except for
obsolete items and items of below-standard quality, all of which shall have been
written off or written down to net realizable value in the CD Financial
Statements or on the Company's accounting records as of the Closing Date, as the
case may be. This representation and warranty shall expire as of the
Determination Date, net of any reserves shown on the books and records of IMS
and IMA.
(e) IMA maintains a system of internal accounting controls sufficient
to provide reasonable assurance that: (i) transactions are executed in
accordance with management's general or specific authorizations; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in accordance with GAAP and to maintain asset accountability; (iii)
access to assets is permitted only in accordance with management's general or
specific authorization; and (iv) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate
actions are taken with respect to any differences.
Section 3.7 Absence of Changes or Events. Since the IMA Balance Sheet
Date, (i) except as set forth in Section 3.7 of the Disclosure Schedule, the CD
Business has been conducted only in the Ordinary Course of Business, (ii) there
has occurred no Material Adverse Effect, and (iii) other than as set forth in
Section 3.7 of the Disclosure Schedule, none of IMA and its Subsidiaries has
taken any actions that, if taken after the date of this Agreement, would
constitute a breach of any of the covenants set forth in Section 4.3(a), (b) and
(c).
Section 3.8 Undisclosed Liabilities. Except with respect to their
respective obligations under this Agreement, the Purchase Agreement and other
Transaction Agreements,
15
neither IMS nor IMA has liabilities or obligations relating to the CD Business
(in each case whether known, absolute, contingent, accrued or otherwise), except
for such liabilities and obligations (a) to the extent shown on the Most Recent
Balance Sheet, (b) incurred in the Ordinary Course of Business since the Most
Recent Balance Sheet Date, (c) under the Business Contracts, other than
liabilities and obligations due to any material breaches or non-performance
thereunder, or (d) listed in Section 3.8 of the Disclosure Schedule.
Section 3.9 Assets other than Real Property. Except as set forth in
Section 3.9 of the Disclosure Schedule, (i) each of IMS and IMA owns outright
and has good and marketable title to, or has valid leasehold interests in, all
of the tangible Contributed Assets free and clear of all Liens, (ii) other than
the Excluded Assets and together with the assets acquired by the Company
pursuant to the Purchase Agreement, the Company's rights under the License
Agreements, the Finished Product Purchase Agreement, the Distribution Agreement
and the Transition Services Agreement, the Contributed Assets constitute all of
the assets, properties, permits, rights, agreements and other Contract rights
and interests that are necessary to enable the Company after the Closing to
operate the CD Business in a manner consistent with the manner in which the CD
Business is currently being operated and (iii) the Transfer will vest good and
marketable title in and to the tangible Contributed Assets in the Company free
and clear of all Liens except for Permitted Liens. To the Knowledge of IMS or
IMA, the tangible Contributed Assets are in good operating condition and repair
and none of such tangible assets that are material to the conduct of the CD
Business is in need of maintenance or repairs except for ordinary, routine
maintenance and repairs that are not material in nature or cost.
Section 3.10 [Reserved].
Section 3.11 Contracts. (a) Section 3.11(a) of the Disclosure Schedule
sets forth a true, accurate and complete list of each Business Contract
(collectively, "Scheduled Contracts") to which IMA, IMS or any of their
Subsidiaries is a party that (x) is material to the CD Business; (y) provides
for aggregate annual payments, or has a value in excess, of fifty thousand
dollars ($50,000); or (z) falls within one or more of the following categories:
(i) Contracts under which IMA, IMS or their Subsidiaries own, have
under license, have a right to acquire (by option or otherwise), have a
right to use or exercise (including any covenant not to xxx or other
similar right of forbearance), or otherwise Control, or have any other
right or interest in or to any Intellectual Property that is necessary to
the conduct of the CD Business as currently conducted;
(ii) Contracts with any labor union or similar representative covering
any Transferred Employee;
(iii) Contracts under which products of the CD Business are
manufactured or distributed by IMA, IMS or their Subsidiaries, including
any distribution agreements, wholesalers, manufacturing and supply
agreements and Contracts with managed care organizations or Governmental
Entities; and
16
(iv) Contracts limiting or restraining IMA, IMS or their Subsidiaries
in any material respect from engaging or competing in any business of the
CD Business with any Person or from purchasing any products, services or
inventory from any third parties.
Notwithstanding the foregoing, neither IMA nor IMS shall be required to set
forth on the aforementioned Section 3.11(a) of the Disclosure Schedule any
Contract relating to IMA's and certain of its Subsidiaries' manufacturing of
products of the CD Business, including Contracts to purchase raw materials,
components or supplies, Contracts to supply or procure reagents or other
biological components and Contracts with subcontractors, suppliers or service
providers used in the conduct of such manufacturing activity.
(b) Except as indicated in Section 3.11(b) of the Disclosure Schedule,
IMA has delivered or made available to PGIO complete and correct copies of all
written Scheduled Contracts, including all amendments, modifications and
material waivers relating thereto.
(c) Each Scheduled Contract is in full force and effect in accordance
with the terms thereof and constitutes a legal, valid and binding agreement of
IMA, IMS or their Subsidiaries, as applicable, and is enforceable in accordance
with its terms by IMA, IMS or their Subsidiaries, as applicable, against each
counterparty thereto, except as the same may be limited by General Limitations.
IMA, IMS and its Subsidiaries, as applicable, have performed in all material
respects all of their obligations, and are not in default under, any Business
Contract. To IMS's or IMA's Knowledge, no other party to any Business Contract
is in material breach of or default under such Business Contract.
(d) Except as set forth in Section 3.11(d) of the Disclosure Schedule,
neither IMA nor IMS has any Knowledge that any party to any Scheduled Contract
(i) intends to either terminate or not renew such Scheduled Contract, or (ii)
has or intends to submit to IMA, IMS or their Subsidiaries any claim of material
breach by any such party with respect to the performance of its obligations
under any such Scheduled Contract.
(e) Section 3.11(e) of the Disclosure Schedule sets forth a true,
accurate and complete list of the Scheduled Contracts for which third party
consents are required to assign such Business Contracts to the Company. Subject
to the receipt of the third party consents listed on Section 3.11(e) of the
Disclosure Schedule and Closing, the Company will succeed to all rights, title
and interests of IMA, IMS or their respective Subsidiaries under each such
Contract without the necessity to obtain the consent of any other Person(s) to
the assignment of such Contract.
(f) None of the Business Contracts have been entered into by IMA, IMS
or any of their respective Subsidiaries other than in its or their Ordinary
Course of Business (other than agreements in settlement of Legal Proceedings
listed on Section 3.13 of the Disclosure Schedule) and other than on an arm's
length basis.
(g) Except as set forth in Section 3.11(g) of the Disclosure Schedule,
the Scheduled Contracts do not contain any provision that provides for automatic
termination upon the occurrence of the transactions contemplated hereby or for
the right of any party to any such
17
Contract to terminate, accelerate or receive any payment or other more favorable
terms and conditions upon occurrence of the transactions contemplated hereby.
(h) Except as set forth in Section 3.11(h) of the Disclosure Schedule,
there are no Persons holding a power of attorney on behalf of IMS, IMA or any of
their Subsidiaries that would enable such Persons to sell, lease or otherwise
encumber any of the Contributed Assets.
Section 3.12 Intellectual Property. (a) Section 3.12(a) of the
Disclosure Schedule sets forth, as of the date hereof, a complete and accurate
list of all Business Registered Intellectual Property. "Business Intellectual
Property" means (i) Business Contributed Intellectual Property, (ii) Business
Purchased Intellectual Property (as defined in the Purchase Agreement) and (iii)
all other Intellectual Property constituting Inverness Licensed IP and Inverness
Licensed Trademarks (as defined in the License Agreements). Except to the extent
indicated in Section 3.12(a) of the Disclosure Schedule, all Business
Intellectual Property is either (x) owned by, or subject to an obligation of
sole and exclusive assignment to, IMS or IMA or one of their respective
Subsidiaries free and clear of all Liens or other exceptions to title that
affect such Business Intellectual Property or restrict the use by IMS or IMA or
any of their respective Subsidiaries of the Business Intellectual Property in
any way or require IMS or IMA or any of their respective Subsidiaries to make
any payment or give anything of value as a condition to its use in any way of
such Business Intellectual Property (collectively, "IP Liens"), except in each
case for Permitted IP Liens or (y) Controlled but not owned by IMS or IMA or one
of their respective Subsidiaries pursuant to a license from, or a similar
agreement with, a third party free and clear, to the Knowledge of IMS and IMA,
of all IP Liens except for Permitted IP Liens. To the Knowledge of IMS or IMA,
with respect to all Business Intellectual Property owned by IMS or IMA or one of
their respective Subsidiaries that are United States patents or applications
subject to a terminal disclaimer against another patent or application, each
such patent or application has been and remains commonly owned with the patent
or application it is terminally disclaimed against since the terminal disclaimer
was filed with the United States Patent Office. Except to the extent indicated
in Section 3.12(a) of the Disclosure Schedule, IMS or IMA or one of their
respective Subsidiaries is (A) the sole owner of all Business Contributed
Intellectual Property and all Business Purchased Intellectual Property and (B)
the sole owner or sole and exclusive licensee (as the case may be) of all
Inverness Licensed IP and Inverness Licensed Trademarks. There are no actions
pending or, to the Knowledge of IMS or IMA, threatened with regard to the
ownership or Control by IMS or IMA or one of their respective Subsidiaries of
any Business Intellectual Property. Except as specified in Section 3.12(a) of
the Disclosure Schedule, each of IMS and IMA has the legal power to convey or
license (as applicable) to the Company all of its or their respective
Subsidiaries' right, title and interest that is being conveyed or licensed in
and to the Business Intellectual Property. No Business Intellectual Property
will terminate or cease to be valid Intellectual Property by reason of the
execution and delivery of this Agreement by IMS and IMA, the performance of IMS
and IMA of their obligations hereunder, or the consummation by IMS and IMA of
the transactions contemplated hereby.
(b) Except as disclosed in Section 3.12(b) of the Disclosure Schedule,
to the Knowledge of IMS or IMA, there is no unauthorized use, infringement,
misappropriation or violation of any of the Business Intellectual Property by
any Person.
18
(c) Except as disclosed in Section 3.12(c) of the Disclosure Schedule,
there are no pending or, to the Knowledge of IMS or IMA, threatened written
claims that the CD Business has infringed or is infringing any Intellectual
Property of any Person. Except for any third-party Intellectual Property
referred to in Section 3.12(c) of the Disclosure Schedule, to the Knowledge of
IMS or IMA, there are no patents or patent applications of any third party that
claim the same subject matter as a patent or patent application included in the
Business Intellectual Property that could reasonably serve as the basis for an
interference proceeding involving a patent or patent application included in the
Business Intellectual Property.
(d) (i) The patent applications owned by IMS or IMA or one of their
respective Subsidiaries and included in the Business Intellectual Property and,
to the Knowledge of IMS or IMA, the patent applications licensed by any third
party to IMS or IMA or one of their respective Subsidiaries and included in the
Business Intellectual Property, are pending and have not been abandoned, and
have been and continue to be prosecuted. All patents, registered Trademarks and
applications for Trademarks owned by IMS or IMA or one of their respective
Subsidiaries and included in the Business Intellectual Property and, to the
Knowledge of IMS or IMA, all patents, registered Trademarks and applications for
Trademarks licensed by any third party to IMS or IMA or one of their respective
Subsidiaries and included in the Business Intellectual Property, have been duly
registered or filed with or issued by the appropriate Governmental Entity, all
necessary affidavits of continuing use have been timely filed, and all necessary
maintenance fees timely paid to continue all such rights in effect. Except as
set forth in Section 3.12(d)(i) of the Disclosure Schedule, none of the patents
owned by IMS or IMA or one of their respective Subsidiaries and included in the
Business Intellectual Property and, to the Knowledge of IMS or IMA, none of the
patents licensed by any third party to IMS or IMA or one of their respective
Subsidiaries and included in the Business Intellectual Property, have expired or
been declared invalid, in whole or in part, by any Governmental Entity. Except
as set forth in Section 3.12(d) of the Disclosure Schedule, there are no ongoing
interferences, oppositions, reissues, or reexaminations or other proceedings
that could result in a loss or limitation of a patent right or claim involving
any of the patents or patent applications owned by IMS or IMA or one of their
respective Subsidiaries and included in the Business Intellectual Property. To
the Knowledge of IMS or IMA, there are no ongoing interferences, oppositions,
reissues, or reexaminations or other proceedings that could result in a loss or
limitation of a patent right or claim involving any of the patents or patent
applications licensed by any third party to IMS or IMA or one of their
respective Subsidiaries and included in the Business Intellectual Property.
(ii) To the Knowledge of IMS or IMA, (A) the patents included in
the Business Intellectual Property have not been declared invalid or
unenforceable by any court, (B) there is no reason to believe that any
patent included in the Business Intellectual Property and material to the
CD Business would be declared invalid or unenforceable by a court, and (C)
each of IMS and IMA has met its duty of candor as required under 37 C.F.R.
1.56 and complied with analogous Laws outside the United States requiring
disclosure of references. To the Knowledge of IMS or IMA, each of the
patents and patent applications included in the Business Intellectual
Property that were filed by IMS or IMA or one of their respective
Subsidiaries properly identifies each and every inventor of the claims
thereof as determined in accordance with the Laws of the jurisdiction in
which such patent is issued or such patent application is pending.
19
(iii) Each inventor named on the patents and patent applications
included in the Business Intellectual Property that were filed by IMS or
IMA or one of their respective Subsidiaries, alone or together with any
joint owners, has executed an agreement agreeing to assign or actually
assigning his or her entire right, title and interest in and to such patent
or patent application, and the inventions embodied and claimed therein, to
IMS or IMA or such Subsidiary, alone or together with any joint owners as
appropriate, except as indicated in Section 3.12(a) of the Disclosure
Schedule. To the Knowledge of IMS or IMA, no such inventor has any
contractual or other obligation that would preclude any such assignment or
otherwise conflict with the obligations of such inventor to IMS or IMA or
such Subsidiary.
(e) Section 3.12(e) of the Disclosure Schedule sets forth a true,
complete and accurate list of all Contracts with respect to any options, rights,
licenses or interests of any kind relating to Business Intellectual Property
that have been granted (i) by a third party to IMS or IMA or any of their
respective Subsidiaries, (ii) by IMS or IMA or any of their respective
Subsidiaries to any other Person (other than agreements commonly generated in
the Ordinary Course of Business (including software licenses for generally
available software, employee assignment agreements, nondisclosure agreements,
consulting agreements, material transfer agreements, clinical trial agreements
and evaluation agreements) that individually and in the aggregate have not
caused and would not reasonably be expected to cause a Material Adverse Effect).
In addition, Section 3.12(e) of the Disclosure Schedule sets forth a true,
complete and accurate list of all Contracts under which IMS or IMA or any of
their respective Subsidiaries is obligated to make to, or receives from third
parties payments (in any form, including royalties, license fees, milestones and
other contingent payments) for use of any Business Intellectual Property. Other
than as set forth on Section 3.12(e) of the Disclosure Schedule, no royalties,
license fees or other payment obligations are owed to any Person in connection
with the exercise of Intellectual Property rights in the conduct of the CD
Business after the Closing Date by IMS or IMA or any of their respective
Subsidiaries under any Contract (other than Contracts relating to "off the
shelf" commercially available software) to which any of them are a party. Each
of IMS and IMA and their respective Subsidiaries is in compliance in all
material respects with the terms of all Contracts set forth on Section 3.12(e)
of the Disclosure Schedule and, to the Knowledge of IMS or IMA, each of the
licensees and licensors, as the case may be, is in compliance in all material
respects with all such Contracts, and there are no material disputes or
proceedings threatened or pending regarding the same.
(f) The Business Intellectual Property constitutes all the
Intellectual Property necessary and sufficient to conduct the CD Business as
currently conducted; provided, that this Section 3.12(f) shall not constitute a
non-infringement representation (which non-infringement representation is the
subject of Section 3.12(g) below).
(g) Except as disclosed in Section 3.12(g) of the Disclosure Schedule,
to the Knowledge of IMS or IMA, the operation of the CD Business does not, and
as a result of Closing will not, infringe on or violate the rights of any Person
under any Intellectual Property.
(h) Each of IMS and IMA and their respective Subsidiaries has taken
reasonable steps to protect the confidentiality of the confidential information
and trade secrets included in the Business Intellectual Property, including by
entering into Contracts that generally require licensees, contractors and other
third persons with access to such trade secrets to keep such trade secrets
confidential.
20
(i) Each of IMS and IMA uses reasonable procedures designed to ensure
the recording and maintenance of all know-how that is included in the Business
Intellectual Property and material to the conduct of the CD Business.
(j) All former and current employees, consultants and contractors of
IMS or IMA or their respective Subsidiaries (i) having access to the Business
Intellectual Property have executed and delivered to IMS or IMA or the relevant
Subsidiary an agreement regarding the protection of the confidential information
included in the Business Intellectual Property and (to the extent required by
any customer or business partner or IMS or IMA) confidential information of
IMS's or IMA's customers or business partners made available to such employees,
consultants or contractors and (ii) who were involved in, or who contributed to,
the creation or development of any Business Intellectual Property have executed
and delivered to IMS or IMA or the relevant Subsidiary an agreement regarding
the assignment by such employees, consultants and contractors to IMS or IMA (or
the relevant Subsidiary) of any and all Business Intellectual Property; and true
and complete copies of all such agreements have been made available to PGIO.
Each of IMS and IMA and their respective Subsidiaries has secured, from all
former and current employees, consultants and contractors who were involved in,
or who contributed to, the creation or development of the subject matter of any
patents that are included in Business Intellectual Property that is owned by IMS
or IMA or the relevant Subsidiary, valid written assignments of the rights to
such contributions that may be owned by such persons or that IMS or IMA or the
relevant Subsidiary does not already own by other agreement or operation of Law,
including obtaining valid written assignments from the inventors of any and all
pending patent applications.
(k) Under any and all Contracts under which a third party has granted
IMA, IMS or any of their respective Subsidiaries any Intellectual Property
rights that are used in the CD Business and on which IMA, IMS or such Subsidiary
relies to allow its Subsidiaries of which IMA, IMS or such Subsidiary owns 50%
or more of the voting equity to exercise the Intellectual Property rights
thereunder, the Company shall have the right to exercise (subject to the terms
and conditions in the Transaction Documents) such Intellectual Property rights
for so long as IMS owns 50% or more of the interest in the Company.
Section 3.13 Legal Proceedings. Except as disclosed in Section 3.13 of
the Disclosure Schedule, (a) neither IMS nor IMA is, or since January 1, 2004
has it been, a party to, or to its Knowledge threatened with, any material Legal
Proceeding with respect to or in connection with the CD Business, (b) to the
Knowledge of IMS or IMA, there are no facts or circumstances that would
reasonably be expected to give rise to any material Legal Proceeding with
respect to or in connection with the CD Business and (c) there are no Judgments
outstanding against IMS or IMA with respect to or in connection with the CD
Business.
Section 3.14 Tax Matters. Except as set forth in Section 3.14 of the
Disclosure Schedule (with paragraph references corresponding to those set forth
below):
(a) All Tax Returns required to be filed by IMS or IMA, and any
affiliated, combined, consolidated or unitary group of which IMS or IMA is or
has been a member, have been timely filed, except where failure to file would
not have a Material Adverse Effect.
21
(b) Each of IMS and IMA has timely paid all Taxes which were required
to have been paid on or prior to the date hereof, the nonpayment of which could
result in a Lien on any Contributed Asset. Each of IMS and IMA has established,
in accordance with GAAP, adequate reserves for the payment of, and will timely
pay, all Taxes which arise from or with respect to the Contributed Assets or the
operation of the CD Business and are incurred or attributable to taxable periods
(or portions thereof) prior to the Closing (the "Pre-Closing Tax Periods"), the
nonpayment of which would result in a Lien on any Contributed Asset.
(c) Each of IMS and IMA has withheld and paid all Taxes required by
Law to have been withheld and paid and has complied in all respects with all
rules and regulations relating to the withholding or remittance of Taxes
(including, without limitation, employee-related Taxes), except where failure to
so withhold, pay or comply would not impose a liability or other obligation on
the Company.
Section 3.15 Insurance. IMS and IMA maintain, with respect to the CD
Business, or under contractual arrangements is named as an additional insured
in, policies or binders of fire, liability (including without limitation product
liability), workers' compensation, vehicular and other insurance customarily
maintained by Persons engaged in businesses similar to the CD Business. A true,
correct and complete list of such policies insuring the CD Business is set forth
in Section 3.15 of the Disclosure Schedule. Such policies and binders are in
full force and effect.
Section 3.16 Benefit Plans. (a) Section 3.16(a) of the Disclosure
Schedule contains a list of all written plans, programs, or arrangements
maintained by IMS or IMA or any of their Subsidiaries, in each case as and to
the extent related to the CD Business, or providing benefits to employees of the
CD Business, or under which IMS or IMA or any of their Subsidiaries, in each
case as and to the extent related to the CD Business, or providing benefits to
employees of the CD Business, has or may have any obligation to contribute, with
respect to any employee of them, whether such plan, program or arrangement is
formal or informal, written or unwritten, and whether or not such plan, program,
or arrangement is an "employee benefit plan" subject to the Employee Retirement
Income Security Act of 1974, as amended ("ERISA") (collectively, the "Benefit
Plans"). The Company will not be responsible for any existing or future
liability under any Benefit Plan.
(b) Each of IMS and IMA has made available to or provided to PGIO true
and complete copies of: (i) each Benefit Plan that is an "employee welfare
benefit plan" under Section 3(1) of ERISA; (ii) each Benefit Plan that is an
"employee pension benefit plan" under Section 3(2) of ERISA; (iii) the most
recent annual report required to be filed, including Form 5500, for each Benefit
Plan described under clauses (i) and (ii) of this Section 3.16(b); (iv) the
current summary plan description and any material modifications thereto; and
(iv) the most recent determination or opinion letter received from the Internal
Revenue Service (the "IRS") upon which IMS and IMA are entitled to rely with
respect to a Benefit Plan described under clause (ii) of this Section 3.16(b)
that is intended to be tax-qualified under Section 401(a) of the Code, or the
application therefor, if such letter has not been issued by the IRS.
(c) Except as set forth on Section 3.16(c) of the Disclosure Schedule,
neither IMS nor IMA or any of their subsidiaries, in each case as and to the
extent related to the CD
22
Business, or providing benefits to employees of the CD Business, has offered to
provide health or life insurance coverage to any individual, or to the family
members of any individual, for any period extending beyond the termination of
the individual's employment by IMS or IMA, except to the extent required by the
health care continuation (also known as "COBRA") provisions of ERISA and the
Code or similar state benefit continuation Laws. Each Benefit Plan that is a
group health plan, as such term is defined in Section 5000(b)(1) of the Code,
complies in all material respects with Sections 601 et seq. and 701 et seq. of
ERISA and Section 4980B and Subtitle K of the Code.
(d) The Company will not be responsible for any existing Contract
between IMS or IMA and any business employee of them, including a Contract (i)
the benefits of which are contingent, or the terms of which are materially
altered, upon the occurrence of a transaction in the nature of any of the
transactions contemplated by this Agreement or any other Transaction Agreement,
(ii) providing any term of employment or compensation guarantee or (iii)
providing severance benefits or other benefits after the termination of
employment of such employee regardless of the reason for such termination of
employment.
Section 3.17 Employee and Labor Matters. Except as set forth on
Section 3.17 of the Disclosure Schedule, there is not, and since January 1, 2004
there has not been, any labor strike, dispute, work stoppage, slowdown or
lockout against IMS or IMA with respect to the CD Business and, except as set
forth on Section 3.17 of the Disclosure Schedule, there is not any pending, or,
to the Knowledge of IMS or IMA, threatened, labor strike, dispute, work
stoppage, slowdown or lockout against IMS or IMA with respect to the CD
Business. To the Knowledge of IMS or IMA, since January 1, 2004, no union
organizational campaign or petition for certification is in progress with
respect to personnel of the CD Business. Neither IMS nor IMA is a party to any
collective bargaining or other similar labor Contracts with respect to any
personnel of the CD Business. There are no pending, or, to the Knowledge of IMS
or IMA, threatened, charges against IMS or IMA or any business personnel of them
before the Equal Employment Opportunity Commission or any other Governmental
Entity responsible for the prevention of unlawful employment practices. Except
as set forth on Section 3.17 of the Disclosure Schedule, since January 1, 2004,
neither IMS nor IMA has received written notice of the intent of any
Governmental Entity responsible for the enforcement of labor or employment Laws
to conduct an investigation of IMS or IMA with respect to the CD Business and,
to the Knowledge of IMS or IMA, no such investigation is in progress. To the
Knowledge of IMS or IMA, no activity of any executive officer or significant
employee of the CD Business as or while an employee of the CD Business has
caused a material violation of any such employee's employment Contract,
confidentiality agreement, patent disclosure agreement or other similar
Contract. The Restructuring will be effected in compliance in all material
respects with all applicable employment laws and regulations.
Section 3.18 Environmental Matters. Except as disclosed in Section
3.18 of the Disclosure Schedule and except for such matters as would not cause a
material Loss to the Company or PGIO:
(a) The CD Business and IMA Facilities are and have for the past four
years been in compliance in all material respects with all Environmental Laws
and Environmental Permits. The CD Business and IMA Facilities have no material
unbudgeted or unreserved environmental capital expenditure necessary to achieve
or maintain compliance in all material
23
respects with Environmental Laws and Environmental Permits. There are no
unresolved or, to the Knowledge of IMS or IMA, threatened (whether orally or in
writing) claims, demands, notices, suits, investigations, inquiries, proceedings
or actions against IMS, IMA or the IMA Facilities, alleging non-compliance in
any material respect with Environmental Law or Environmental Permits. To the
Knowledge of IMS or IMA, there are no circumstances or conditions involving the
CD Business or IMA Facilities or any real property currently owned, operated or
leased by any of them that could reasonably be expected to result in any
material Environmental Liability for which the Company or PGIO would be
responsible.
(b) No property constituting a Contributed Asset or a Purchased Asset
(including soils, groundwater, surface water, buildings or other structures)
currently owned, operated or leased by the CD Business and no IMA Facilities are
contaminated with any Hazardous Material at levels or in amounts that violate or
require investigation, monitoring or response actions pursuant to applicable
Environmental Laws. Neither IMS or IMA nor any of their Subsidiaries is subject
to any material Environmental Liability for Hazardous Material disposal or
contamination on any third party property. Neither IMS or IMA nor any of their
Subsidiaries has manufactured, generated, received, used, handled, processed,
stored, treated, released, discharged, emitted, shipped or disposed of any
Hazardous Material (whether or not on its own leased, owned or operated
properties or properties owned leased or operated by others) except in material
compliance with all Environmental Laws.
(c) The CD Business and IMA Facilities have obtained and maintained in
effect all Environmental Permits material to the conduct of their businesses
and, where applicable, have filed timely applications for renewal or
modification of Environmental Permits. No Environmental Permit material to the
conduct of the CD Business or the operation of the IMA Facilities is subject to
major modification, revision, rescission, public notice and comment or prior
consent by any Governmental Entity as a result of the consummation of the
transactions contemplated by this Agreement and the other Transaction
Agreements.
(d) Neither the CD Business nor any of the IMA Facilities has received
any notice from any Person or is aware of any condition, event or circumstance
(including but not limited to the release or threatened release of any Hazardous
Material at any property currently or formerly owned, leased or used by IMS or
IMA, any Affiliate, or any third party) that would reasonably be expected to
result in a material Environmental Liability for which the Company or PGIO could
be responsible.
(e) Except for indemnifications under manufacturing, supply or similar
agreements set forth in Section 3.18 of the Disclosure Schedule, neither IMS or
IMA nor any of their Subsidiaries has assumed or retained by operation of law or
by Contract any Environmental Liability of any third-party for which the Company
or PGIO could be responsible.
(f) To the Knowledge of IMS and IMA, no Lien or "super lien" has been
placed on any site owned or operated by the CD Business or IMA Facilities
pursuant to the Federal Comprehensive, Environmental Response, Compensation, and
Liability Act of 1980 or any similar Law.
24
(g) This Section 3.18 constitutes the sole representations and
warranties of IMS or IMA relating to environmental matters.
Section 3.19 Transactions with Affiliates. Section 3.19 of the
Disclosure Schedule describes any material transaction, since January 1, 2004,
between IMS or IMA, on the one hand, and any of their Affiliates (other than
wholly-owned Subsidiaries of IMS or IMA and the Inverness Medical (Shanghai),
Co., Ltd.), on the other hand, with respect to the CD Business, other than any
employment Contract, Contract with any employee pertaining to any Benefit Plan
or equity incentive award, Contract not to compete with IMS or IMA, Contract to
maintain the confidential information of IMS or IMA, or Contract assigning
Intellectual Property Rights to IMS or IMA. Except as set forth in Section 3.19
of the Disclosure Schedule, no Affiliate of IMS or IMA (other than wholly-owned
Subsidiaries of IMS or IMA and Inverness Medical (Shanghai), Co., Ltd.) (i) owns
or has any interest in any property (real or personal, tangible or intangible),
Intellectual Property Rights or Contract used or held for use in or pertaining
to the CD Business, (ii) to the Knowledge of IMS or IMA, has any claim or cause
of action against IMS or IMA with respect to the CD Business or (iii) owes any
money to, or is owed any money by, IMS or IMA with respect to the CD Business
except, in each case, pursuant to any employment Contract, Benefit Plan or for
reimbursement of business expenses in the Ordinary Course of Business. For the
avoidance of doubt, the matters set forth in this Section 3.19 are neither
intended to relate to, nor is any disclosure provided with respect to,
intercompany arrangements, Contracts or understandings among IMA and its
Subsidiaries or Inverness Medical (Shanghai), Co., Ltd.
Section 3.20 Certain Business Practices. Neither IMS or IMA nor any of
their directors, officers, agents or employees, has (i) used any funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related
to political activity; (ii) made any unlawful payment to foreign or domestic
government officials or employees or to foreign or domestic political parties or
campaigns or violated any provision of the Foreign Corrupt Practices Act of 1977
or similar laws in any other jurisdiction or (iii) made any payment in the
nature of criminal bribery.
Section 3.21 Regulatory Compliance. (a) Except as set forth in Section
3.21(a) of the Disclosure Schedule, each Product that is subject to the
jurisdiction of the FDA or similar Governmental Entity, or subject to the
Federal Food, Drug and Cosmetic Act, as amended, and the regulations promulgated
thereunder (the "FDCA") or similar Laws in any foreign jurisdiction, is being
formulated, developed, manufactured, packaged, tested, advertised, marketed,
promoted, distributed and sold by IMS, IMA or one of their respective
Subsidiaries in compliance in all material respects with all applicable
requirements under the FDCA and similar Laws, including those relating to
investigational use, good clinical practices, current good manufacturing
practices, introduction of products into interstate commerce, record keeping,
advertising and marketing, reporting of adverse events and filing of other
reports. Except as set forth in Section 3.21(a) of the Disclosure Schedule,
since January 1, 2004 neither IMS nor IMA nor any of their respective
Subsidiaries has received any written notice from the FDA or any other
Governmental Entity alleging any material violation of any Law by IMS or IMA or
any of their respective Subsidiaries applicable to any Product. Except as set
forth in Section 3.21(a) of the Disclosure Schedule, since January 1, 2004,
neither IMS nor IMA nor any of their respective Subsidiaries has received any
written notices of inspectional observations (including those
25
recorded on form FDA 483), establishment inspection reports, warning letters and
any other documents received from or issued by the FDA or any similar
Governmental Entity asserting non-compliance in any material respect with FDA
regulatory requirements or other applicable Laws of any similar Governmental
Entity by IMS or IMA or any of their respective Subsidiaries with respect to the
CD Business or Persons otherwise performing services for the benefit of IMS or
IMA or any of their respective Subsidiaries with respect to the CD Business,
except for matters resolved prior to the date hereof. In addition, no
Governmental Entity or other Person has commenced or, to the Knowledge of IMS or
IMA, threatened to initiate any proceeding alleging, any violations of any
federal, state or local consumer protection laws.
(b) Section 3.21(b) of the Disclosure Schedule sets forth for each
Product a true, correct and complete list of all pre-clinical and clinical
studies and trials ongoing with respect to such Product as of the date hereof.
(c) All physician and consumer product information required to
accompany the distribution of each Product (hereafter "Labeling") complies in
all material respects with all Laws and guidelines published and enforced by the
FDA, including Section 502 (21 U.S.C. Section 352) of the FDCA and 21 C.F.R.
Section 801, or similar Laws in any foreign jurisdiction.
(d) For each Product, all required post-approval regulatory reports
and submissions, including those required by 21 C.F.R. Parts 803 and 806, or
similar Laws in any foreign jurisdiction, have been timely submitted and all
post-marketing obligations have been timely completed or fulfilled, except where
such failure to so timely submit, complete or fulfill would not prohibit or
delay the continued manufacture, sale and distribution of any Product currently
manufactured, marketed, sold and distributed by the CD Business. Except as set
forth on Section 3.21(d) of the Disclosure Schedule, there has not been any
occurrence of any medical device report concerning any Products under 21 C.F.R.
Part 803 that has not been resolved prior to the date hereof.
(e) Except as set forth on Section 3.21(e) of the Disclosure Schedule,
neither IMS or IMA or any of their respective Subsidiaries, nor, to their
Knowledge, any officer, employee or agent of them, has made an untrue statement
of a material fact or fraudulent statement to the FDA or any other Governmental
Entity, failed to disclose a material fact required to be disclosed to the FDA
or any other Governmental Entity, or committed an act, made a statement, or
failed to make a statement that, at the time such disclosure was made, would
reasonably be expected to provide a basis for the FDA or any other Governmental
Entity to invoke its policy respecting "Fraud, Untrue Statements of Material
Facts, Bribery, and Illegal Gratuities", set forth in 56 Fed. Reg. 46191
(September 10, 1991) or any similar policy. Neither IMS or IMA nor, to their
Knowledge, any officer, employee or agent of them, has been convicted of any
crime or engaged in any conduct for which debarment is mandated by 21 U.S.C.
Section 335a(a) or any similar Law or authorized by 21 U.S.C. Section 335a(b) or
any similar Law, nor has IMS or IMA (or any of their respective Subsidiaries)
received written notice of any proposed disqualification, debarment or exclusion
including exclusion under 42 U.S.C. Section 1320a 7 or any similar Law. Neither
IMS or IMA or any of their respective Subsidiaries nor, to their Knowledge, any
officer, employee or agent of them, has been convicted of any crime or engaged
in any conduct for which such Person or entity could be excluded from
26
participating in the federal health care programs under Section 1128 of the
Social Security Act or any similar Law.
Section 3.22 Product Liability Claims; Product Recalls. Except as set
forth on Section 3.22 of the Disclosure Schedule, since January 1, 2004 neither
IMS nor IMA has received any written notice from any Person regarding any
actual, alleged, possible or potential claim by any Person or group of Persons,
including any Governmental Entity, for money damages or any other form of
relief, whether in law or equity, in respect of potential or actual injury or
harm allegedly resulting from or due and owing in connection with the purchase,
use, application of, or defect (including alleged failure to warn) relating to
any of the Products, irrespective of the legal theory of liability except for
Product returns in the Ordinary Course of Business and other claims that were
resolved prior to the date hereof without payment of significant money damages
or the entry of, or agreement to, other forms of relief that were material to
the CD Business. Except as set forth on Section 3.22 of the Disclosure Schedule,
since January 1, 2004 no Product has been the subject of any recall, market
withdrawal, correction, or removal, and neither IMS nor IMA has received any
written notice that the FDA or any other Governmental Entity has (i) commenced
or threatened in writing to initiate any action to withdraw its approval or
request the recall, market withdrawal, correction, or removal of any Product or
(ii) commenced or threatened in writing to initiate, any action to enjoin
production of any Product at any facility. Except as set forth in Section 3.22
of the Disclosure Schedule, no event has occurred, and to the Knowledge of IMS
or IMA, no condition or circumstance exists (including any adverse reactions or
Product failure), that might (with or without notice or lapse of time) directly
or indirectly give rise to or serve as a basis for any such recall, market
withdrawal, correction, or removal or other similar actions relating to any such
Product.
Section 3.23 Product Registrations. Section 3.23 of the Disclosure
Schedule sets forth, as of the date hereof, a list of all material Governmental
Licenses granted to IMS or IMA to market any of the Products (the "Product
Registrations"). Except as set forth in Section 3.23 of the Disclosure Schedule,
(i) all Products sold under the Product Registrations are manufactured and
marketed in accordance with the specifications and standards contained in such
Product Registrations, (ii) IMS or IMA is the sole and exclusive owner of the
Product Registrations and has not granted any right of reference to any Person
with respect thereto, and (iii) the Product Registrations do not include or
require reference to any other Governmental Licenses or other filings with any
Governmental Entity. The Product Registrations are all the registrations,
approvals, licenses or authorizations required to market the Products currently
marketed by the CD Business. IMS and IMA have made available to PGIO true,
complete and accurate copies of all Product Registrations and all material
correspondence, written notices or written communications received from or sent
to the FDA or other Governmental Entities relating to the Products.
Section 3.24 Purchase for Investment. The Shares issued or issuable to
IMS under this Agreement and the Limited Liability Company Agreement are being
acquired for its own account for the purpose of investment, it being understood
that the right to dispose of such Shares shall be entirely within the discretion
of IMS. IMS will refrain from transferring or otherwise disposing of any of the
Shares, or any interest therein, in such manner as to cause the Company or PGIO
to be in violation of the registration requirements of the Securities Act of
1933, as amended (the "Securities Act"), or applicable state securities or blue
sky laws.
27
Section 3.25 Brokers' Fees. No broker, finder, financial advisor,
investment banker or other Person is or will be entitled to any brokerage,
finder's, financial advisor's or other similar fee or commission in connection
with the transactions contemplated by this Agreement and the Transaction
Agreements for which PGIO or the Company could be liable.
ARTICLE 4
COVENANTS
Section 4.1 Filings. Each of the parties hereto agrees to cooperate
fully with the others in the preparation and filing, whether before or after the
Closing Date, of all documents and instruments required to be filed by PGIO,
IMS, IMA or the Company in connection with the transactions contemplated by this
Agreement and the other Transaction Agreements, including, without limitation,
any business certificate, or any trade, assumed or fictitious name certificates,
or any applications for authority to do business, or any registrations or
assignments of registrations of any patents, trademarks, trade names, service
marks, copyrights or similar rights.
Section 4.2 Access and Investigation. (a) Subject to Section 4.12
hereof, prior to the Closing Date and subject to any restrictions imposed by
applicable Law or any Business Contract, IMS, IMA and their Affiliates and
Representatives shall: (i) afford PGIO and its Affiliates and Representatives,
during normal business hours and upon reasonable notice, full and free access to
the personnel, properties, contracts, books and records, and other documents and
data relating to the CD Business (ii) furnish PGIO and its Representatives with
copies of all such contracts, books and records, and other existing documents
and data relating to the CD Business, as PGIO may from time to time reasonably
request, and (iii) furnish PGIO and its Representatives with such additional
financial, operating, and other data and information relating to the CD Business
as PGIO may reasonably from time to time request; provided that any such
investigation by PGIO shall be conducted in such a manner as not to interfere
unreasonably with the normal operations of IMS or IMA.
(b) Subject to Section 4.12 hereof, prior to the Closing Date and
subject to any restrictions imposed by applicable Law, PGIO and its Affiliates
and Representatives shall: (i) afford IMS and its Affiliates and
Representatives, during normal business hours and upon reasonable notice, full
and free access to the personnel, properties, contracts, books and records, and
other documents and data relating to the portions of PGIO that will perform
services under the Transaction Agreements to the extent reasonably necessary to
plan to integrate, as applicable, the operations and activities of the CD
Business with the Company and PGIO, (ii) furnish IMS and its Representatives
with copies of all such contracts, books and records (if any), and other
existing documents and data relating to the portions of PGIO that will perform
services under the Transaction Agreements as IMS may from time to time
reasonably request to the extent reasonably necessary to plan to integrate, as
applicable, the operations and activities of the CD Business with the Company
and PGIO, and (iii) furnish IMS and its Representatives with such additional
financial, operating, and other data and information relating to the portions of
PGIO that will perform services under the Transaction Agreements as IMS may
reasonably from time to time request to the extent reasonably necessary to plan
to integrate, as applicable, the operations and activities of the CD Business
with the Company and PGIO; provided that any
28
such investigation by IMS shall be conducted in such a manner as not to
interfere unreasonably with the normal operations of PGIO.
Section 4.3 Conduct of Business. (a) From the date hereof through the
Closing Date, IMS and IMA shall (x) except as set forth in Section 4.3(a) of the
Disclosure Schedule, conduct the CD Business only in the Ordinary Course of
Business, (y) use their commercially reasonable efforts to preserve the CD
Business intact and (z) use their commercially reasonable efforts to keep
available to the CD Business the services of its present officers, employees,
consultants and agents, maintain its present vendors, customers, suppliers and
distributors and preserve and enhance its goodwill. Without limiting the
generality of the foregoing:
(b) Except as set forth in Section 4.3(b) of the Disclosure Schedule,
from the date hereof through the Closing Date, except as otherwise expressly
required or permitted pursuant to this Agreement or in connection with the
Restructuring, neither IMS nor IMA shall, without the prior written consent of
PGIO which consent shall not be unreasonably withheld, take or cause to be taken
any of the following actions with respect to the CD Business:
(i) (A) sell, transfer, license, mortgage, lease or otherwise dispose
of or agree to sell, transfer, license, mortgage, lease or otherwise
dispose of or otherwise encumber or subject to any Lien, other than a
Permitted Lien or any Lien that will be unconditionally and fully released
prior to the Closing, any Contributed Assets, which are material,
individually or in the aggregate, to the CD Business (excluding sales of
inventory in the Ordinary Course of Business) or (B) acquire any assets,
except in the Ordinary Course of Business, which are material, individually
or in the aggregate, to the CD Business except for any such acquisitions
set forth in IMA's current budget applicable the CD Business previously
provided to PGIO or (ii) any other acquisition that will be offered to the
Company pursuant to or on terms consistent with Article 12 of the Limited
Liability Company Agreement;
(ii) (x) increase or adjust in any manner the compensation (wages,
salaries, bonuses or other compensation) of the employees of the CD
Business or any of its consultants or agents that will become consultants
or agents of the Company pursuant to this Agreement, unless such increase
or adjustment is pursuant to Law or any applicable collective bargaining
agreement or any existing agreement with such Person and except for
increases in the compensation of employees of the CD Business made
consistently with past practice and in the Ordinary Course of Business or
(y) except in the Ordinary Course of Business, hire or dismiss (except for
cause or breach or upon termination of the applicable engagement) any
officer or significant employee of the CD Business, any other employee of
the CD Business whose compensation is in excess of US $100,000 per annum,
or any sales agent or consultant of the CD Business, except as otherwise
contemplated by this Agreement;
(iii) make any material capital expenditures or improvements in the CD
Business not provided for in the current budget for the CD Business
previously provided to PGIO;
(iv) cancel or waive any material claim or right relating to the CD
Business;
29
(v) cancel without replacement or reduce in any material respect any
of the insurance coverages for the CD Business;
(vi) except for actions permitted or required by this Agreement or
necessary to consummate the transactions contemplated hereby, take any
action or fail to take any action that permits any Governmental License
material to the conduct of the CD Business to expire, be cancelled or be
amended in a manner adverse to the CD Business;
(vii) incur any obligation under any Business Contract or accounts
payable of the CD Business, in each case that are to be Assumed
Liabilities, other than in the Ordinary Course of Business;
(viii) amend or terminate any Business Contract or Governmental
License material to the conduct of the CD Business to which IMS or IMA is a
party, except amendments or terminations of such Business Contracts or
Governmental Licenses that are in the Ordinary Course of Business;
(ix) except as required by applicable Law or any judgment arising from
any Legal Proceeding, make any commitment to or incur liability to any
labor organization that represents, purports to represent or is attempting
to represent, employees of the CD Business;
(x) make any material change of the policies or practices with respect
to the CD Business;
(xi) make any material change in any method of accounting or auditing
practice, principle or policy of the CD Business, change or revalue any
material assets or make or change any Tax election or tax accounting method
relating to the CD Business except, in each case, as required by GAAP or
any applicable Law;
(xii) collect the accounts receivable relating to the CD Business
other than in the Ordinary Course of Business;
(xiii) write-down of the value of any of the Contributed Assets except
in the Ordinary Course of Business or as required by GAAP;
(xiv) engage in any other extraordinary corporate transactions that
would materially impede the transactions contemplated by this Agreement; or
(xv) agree, whether in writing or otherwise, to take any of the
actions set forth in Sections 4.3(b)(i)-(xiv).
(c) From the date hereof through the Closing Date, IMS and IMA shall:
(i) maintain and purchase adequate levels of inventories to carry on
the CD Business in the Ordinary Course of Business;
30
(ii) make capital expenditures in accordance in all material respects
with the budget for the CD Business previously provided to PGIO;
(iii) pay and discharge its liabilities and obligations, including
accounts payable, with respect to the CD Business in the Ordinary Course of
Business;
(iv) to the extent permitted by applicable Law, confer with PGIO
concerning operation matters of a material nature with respect to the CD
Business;
(v) use commercially reasonable efforts to preserve the
confidentiality of all trade secrets eligible for protection under
applicable trade secret law and material to the operation of the CD
Business; and
(vi) to the extent permitted by applicable Law, otherwise report
periodically to PGIO concerning the status of the operations and finances
of the CD Business.
(d) PGIO and the Company (i) shall take no action, nor make any public
announcement or any other disclosure concerning any actions, the effect of which
may be to frustrate IMS's and IMA's ability to fulfill their obligations under
this Section 4.3, and (ii) shall use commercially reasonable efforts to assist
IMS and IMA in fulfilling their respective obligations under the preceding
sentence, including taking such actions as may be reasonably requested by IMS or
IMA in furtherance of the foregoing.
Section 4.4 Commercially Reasonable Efforts. Upon the terms and
subject to the conditions set forth in this Agreement, each of the parties
hereto shall use commercially reasonable efforts to take, or cause to be taken,
all actions, and to do, or cause to be done, and to assist and cooperate with
the other parties in doing, all things necessary, proper or advisable to
consummate and make effective, in the most expeditious manner practicable, the
transactions contemplated by this Agreement and the other Transaction
Agreements, including (i) the obtaining of all necessary actions or nonactions,
waivers, consents and approvals from Governmental Entities and the making of all
necessary registrations and filings (including filings with Governmental
Entities, if any) and the taking of all reasonable steps as may be necessary to
obtain an approval or waiver from, or to avoid an action or proceeding by, any
Governmental Entity, (ii) the obtaining of all necessary consents, approvals or
waivers from third parties, and (iii) the execution and delivery of any
additional instruments necessary to consummate the transactions contemplated by
this Agreement and the other Transaction Agreements and to fully carry out the
purposes of this Agreement and the other Transaction Agreements.
Section 4.5 Public Announcements. No party to this Agreement (nor any
agent or Representative thereof) will make any disclosure or public announcement
with respect to the this Agreement, the other Transaction Agreements and the
transactions contemplated hereby and thereby without the written approval of the
other party; provided that any party may make such disclosure (including filings
with the Securities and Exchange Commission) or public announcement if it is
advised by counsel that such disclosure or public announcement is legally
advisable in light of the prior public disclosure practice of such party (in
which case such party shall use its reasonable best efforts to consult with the
other party regarding such disclosure or public announcement prior to the making
of such disclosure).
31
Section 4.6 Enforcement . All representations, warranties, covenants
and other agreements made by IMS or IMA to the Company herein or in other
Transaction Agreements are also expressly made for the benefit of PGIO and may
be enforced by PGIO both in its own right and on behalf of the Company.
Section 4.7 Inventory. From and after the Closing Date, with respect
to any inventory of the CD Business that is shipped to customers of the CD
Business prior to the Closing and is returned by such customers ("Returned
Inventory"), the Company shall be entitled to receive such Returned Inventory
and the Company shall credit to such customer the full value of such Returned
Inventory against the applicable Account Receivable.
Section 4.8 Transfer. (a) IMS and IMA shall take all necessary actions
to ensure that any asset that would constitute a Contributed Asset or a
Purchased Asset that is held by a Subsidiary of IMS or IMA (other than any asset
that constitutes an Excluded Asset) are Transferred to IMS on or prior to the
Closing Date but in any event in advance of the Closing contemplated by this
Agreement such that such asset is transferred by IMS or IMA to the Company as
contemplated hereby. From and after the Closing, IMS shall, and shall cause IMA
to, take, or cause to be taken, all action necessary to transfer to the Company
without consideration any assets owned by them or their Affiliates that should
have been transferred to the Company at or prior to the Closing pursuant to this
Agreement.
(b) To the extent that any list, document, record, written
information, computer file or other computer readable media described in Section
1.2(vi) or 1.2(vii) includes matters unrelated to the CD Business that cannot be
separated by IMS, IMA or a Subsidiary thereof without materially affecting the
Company's use of such list, document, record, written information, computer file
or other computer readable media, IMA and IMS shall provide the Company with a
complete copy of such list, document, record, written information, computer file
or other computer readable media; provided that the Company shall not acquire
any title to, or rights in, any portion of such list, document, record, written
information, computer file or other computer readable media that is not related
to the CD Business; and provided further that the Company shall not use or
disclose any portion of such list, document, record, written information,
computer file or other computer readable media that is not related to the CD
Business.
Section 4.9 Further Assurances. Each of PGIO, IMS, IMA and the Company
shall execute, following the Closing, such documents and other papers and
perform such further acts as may be reasonably required or desirable to Transfer
all Contributed Assets and Purchased Assets to the Company or PGIO (which shall
simultaneously contribute them to the Company), respectively, and otherwise to
carry out the provisions hereof and the transactions contemplated hereby or to
carry out the provisions of the Purchase Agreement and the transactions
contemplated thereby. The Company shall perform and discharge the Assumed
Liabilities in accordance with their terms.
Section 4.10 Accounts Receivable. On and after the Closing Date, IMS
agrees to promptly remit to the Company any amounts in respect of Accounts
Receivable accrued after the Closing Date that are collected or received by IMS
or its Affiliates. From and after the Closing Date, the Company will ensure that
all invoices delivered to customers are
32
conspicuously marked as payable to the Company. From and after the Closing Date,
IMS agrees to reasonably cooperate with the Company with respect to the
collection of Accounts Receivable.
Section 4.11 Expenses. Whether or not the Closing occurs, each of the
parties hereto shall bear its own fees and expenses incurred or owed in
connection with this Agreement, the other Transaction Agreements and the
transactions contemplated hereby and thereby and the negotiations thereof
(including any due diligence or other investigation costs relating to such
transactions).
Section 4.12 Confidentiality. Each party hereto agrees to abide by the
provisions set forth in the Confidentiality Agreement, dated as of December 16,
2005 between The Procter & Xxxxxx Company and IMA, and executed by each of them
relating to confidentiality.
Section 4.13 [Reserved].
Section 4.14 Preparation for Transition. Each of IMS and PGIO agrees
to use, and to cause any of its respective Affiliates to use, its commercially
reasonable efforts to cooperate with the other and the Company after the date of
this Agreement in planning to implement any actions with respect to the CD
Business reasonably requested by PGIO in preparation for PGIO or its Affiliates
to be able to provide certain services to the Company upon Closing.
Section 4.15 Other Subsidiaries. PGIO and IMS agree that there will be
certain costs and expenses associated with the IMA's Subsidiaries listed on
Section 4.15 of the Disclosure Schedule either ceasing to conduct the CD
Business that such entities had conducted or otherwise terminating activities
(including through liquidation, dissolution or similar activity) with respect to
the CD Business. Each of PGIO and IMS agree to bear an equal (50-50) share of
all costs, fees and expenses (other than Taxes which shall be borne by IMS or
its Affiliates) arising from, relating to or resulting from such cessation or
termination of CD Business activities by, or liquidation, dissolution or similar
activity with respect to, such Subsidiaries, including costs, fees and expenses
incurred or to be incurred in connection with employee matters, including
severance or similar costs, cancellation of leases, restructuring costs, fees
and expenses arising from, relating to or resulting from such cessation or
termination. Each of PGIO and IMA shall use commercially reasonable efforts to
implement such cessation or termination as promptly as reasonably practicable
following any decision by IMA or a Subsidiary thereof to so cease or terminate
activities, including sharing estimated costs, fees and expenses and proposed
timelines for such cessation or termination.
Section 4.16 Compliance with Contractual Obligations. The Company
agrees that it will comply, to the extent applicable, with the provisions of the
agreements set forth in Section 4.16 of the Disclosure Schedule.
Section 4.17 Issuance of Shares. Prior to or on the Closing Date:
(a) IMS, PGIO and the Company shall execute a short form contribution
agreement and shall procure a certified translation into French thereof, to be
filed with the commercial register at the Company's registered seat;
33
(b) the Shareholders shall approve at a shareholders meeting the
increase of the Company's share capital to issue the Shares in accordance with
Section 1.6; and
(c) the Shareholders shall resolve to amend the Company's articles of
association so as to reflect the increase of the Company's share capital and the
agreements of the parties to the Shareholder Agreement.
Section 4.18 Unipath Purchase. Concurrently with the Closing, the
Company or a Subsidiary of the Company shall purchase (or PGIO shall purchase
and simultaneously contribute to the Company) certain assets and assume certain
liabilities of Unipath Ltd. relating to the research and development activities
for the consumer and diagnostics business pursuant to a purchase agreement which
shall be on mutually agreeable terms with such provisions as are necessary to
comply with applicable law. If the Company or a Subsidiary of the Company
purchases such assets, PGIO shall contribute to the Company the full purchase
price of such assets under the terms of the PGIO Contribution Agreement. In each
case, the purchase price provided for in Section 1.6 of the Purchase Agreement
shall be reduced by the purchase price paid for such assets.
ARTICLE 5
TAX MATTERS
Section 5.1 Cooperation. After the Closing, each of the Company, PGIO,
IMS and IMA shall reasonably cooperate in preparing and filing all Tax Returns
to the extent such filing requires providing necessary information, records and
documents relating to the Contributed Assets or the CD Business. Each of the
Company, PGIO, IMS and IMA shall cooperate in the same manner in defending or
resolving any audit, examination or litigation relating to Taxes.
Section 5.2 Apportioned Obligations. All real property taxes, personal
property taxes and similar ad valorem obligations levied with respect to the
Contributed Assets for a taxable period that includes (but does not end on) the
Closing Date (collectively, the "Apportioned Obligations") shall be apportioned
between the Company and IMA based on the number of days of such taxable period
included in the Pre-Closing Tax Period and the number of days of such taxable
period after the Closing Date (any such portion of such taxable period, the
"Post-Closing Tax Period"). IMA shall be liable for the proportionate amount of
such Apportioned Obligations attributable to the Pre-Closing Tax Period, and the
Company shall be liable for the proportionate amount of such Apportioned
Obligations attributable to the Post-Closing Tax Period.
Section 5.3 Transfer Taxes. All transfer, value-added, sales, use,
stamp, registration and other such Taxes and fees (including any penalties and
interest) ("Transfer Taxes") incurred in connection with the transactions
contemplated by this Agreement (including any real property transfer Tax and
similar Tax) shall be borne and paid by IMS. The party required by applicable to
Law to file any Tax Return in respect of any such Transfer Taxes shall file such
Tax Returns and other documentation with respect to all such Transfer Taxes and,
if required by applicable Law, the non-filing party shall join in the execution
of any such Tax
34
Returns and other documentation, provided that any costs, fees or other expenses
in connection with the foregoing shall be borne by IMS and IMA.
Section 5.4 Tax Payments. Apportioned Obligations and Transfer Taxes
shall be timely paid, and all applicable filings, reports and returns shall be
filed, as provided by applicable Law. The paying party shall be entitled to
reimbursement from the non-paying party in accordance with Section 5.2 or 5.3,
as the case may be. Upon payment of any such Apportioned Obligation or Transfer
Tax, the paying party shall present a statement to the non-paying party setting
forth the amount of reimbursement to which the paying party is entitled under
Section 5.2 or 5.3, as the case may be, together with such supporting evidence
as is reasonably necessary to calculate the amount to be reimbursed. The
non-paying party shall make such reimbursement promptly but in no event later
than 10 days after the presentation of such statement.
Section 5.5 Transaction Treated as a Contribution. The parties agree
that the contribution transactions set forth in this Agreement shall be treated
for U.S. federal income tax purposes as contributions of property in exchange
for interests in the Company within the meaning of Section 721(a) of the Code.
ARTICLE 6
CONDITIONS TO CLOSING
Section 6.1 Conditions to Each Party's Obligation. The respective
obligations of each of PGIO, IMS, IMA and the Company to enter into and complete
the Closing shall be subject to the satisfaction (or express written waiver by
PGIO and IMA) on or prior to the Closing Date of the following conditions:
(i) Anti-Trust. Any waiting period (and any extension thereof)
applicable to this Agreement, the other Transaction Agreements or the
transactions contemplated hereby or thereby under the HSR Act (or any
similar Law of any Governmental Authority) shall have been terminated or
shall have expired.
(ii) No Injunction or Restraint.
(A) No temporary restraining order, preliminary or permanent
injunction or other order or decree issued by any court of competent
jurisdiction or other legal restraint or prohibition (collectively, "Legal
Restraints") preventing the consummation of the transactions contemplated
hereby and by the other Transaction Agreements shall be in effect; and
(B) There shall not be pending or threatened by any Governmental
Entity any Legal Proceeding (or by any other Person any Legal Proceeding
which has a reasonable likelihood of success), (a) challenging or seeking
to restrain or prohibit the transactions contemplated by this Agreement or
the other Transaction Agreements or seeking to obtain in connection with
such transactions any damages that are material in relation to the CD
Business, (b) seeking to prohibit or limit the ownership or operation by
the Company of any material portion of their respective businesses or
assets, or to compel the Company to dispose of, hold separate or license
any material portion of their respective businesses or
35
assets, as a result of the transactions contemplated by this Agreement and
the other Transaction Agreements, (c) seeking to impose limitations on the
ability of PGIO or the Company to acquire or hold, or exercise full rights
of ownership of, the CD Business or any of the Contributed Assets or the
Purchased Assets or (d) seeking to prohibit PGIO or the Company from
effectively controlling in any material respect the CD Business or the
operation thereof.
(iii) Shareholder Agreement. The Shareholder Agreement shall have been
executed and delivered by each party thereto.
(iv) Purchase Agreement. The closing of the transactions contemplated
in the Purchase Agreement shall have taken place concurrently with the
Closing hereunder.
(v) Senior Lender Consent. IMA shall have received the consent of its
senior lender to the consummation of the transactions contemplated by, and
the performance of its and its subsidiaries obligations under (including
the release of Liens), this Agreement, the Purchase Agreement, and the
other Transaction Documents, in form and substance reasonably satisfactory
to PGIO.
(vi) Bonds. IMA shall either (x) provide an officer's certificate with
respect to its bonds due 2012 to the effect that the transactions
contemplated hereby are permitted under the applicable indenture governing
such bonds (the "Bond Indenture"), as well as a copy of the certificate(s)
required to be delivered by IMA under Section 4.12(a)(2) of the Bond
Indenture, or (y) have prepaid in full or defeased such bonds.
(vii) US CD LLC Transaction. Affiliates of IMS and PGIO shall have
entered into a mutually agreeable Contribution Agreement and Purchase
Agreement with respect to certain assets used in the CD Business in the
United States and the closing thereunder shall have taken place
concurrently with the Closing hereunder.
(viii) Unipath Purchase. The closing of the purchase contemplated by
Section 4.18 shall have taken place concurrently with the Closing
hereunder.
(ix) Tax Rulings. Tax rulings from the Swiss taxing authorities shall
have been received with respect to the transactions contemplated hereby in
form and substance reasonably satisfactory to IMS, IMA and PGIO.
Section 6.2 Conditions to the Company's Obligations. The obligations
of the Company to complete the Closing is subject to the satisfaction (or
express written waiver by the Company and PGIO) on or prior to the Closing Date
of the following conditions:
(i) Representations, Warranties. The representations and warranties of
IMS and the Company set forth in this Agreement and in the Purchase
Agreement shall be true and correct as of the Closing Date or such other
date that any such representation or warranty speaks as of, except where
the failure to be true and correct would not, individually or in the
aggregate (a) have a Material Adverse Effect, or (b) materially impair IMS,
IMA or the Company's ability to consummate the transactions contemplated
36
by this Agreement and the Purchase Agreement or to perform their
obligations under this Agreement or the other Transaction Agreements.
(ii) Performance. All the terms, covenants, agreements and conditions
of this Agreement and the Purchase Agreement to be complied with and
performed by the Company, IMS and IMA on or before the Closing Date shall
have been complied with and performed prior to or on the Closing Date
except where the failure to so perform would not, individually or in the
aggregate (a) have a Material Adverse Effect, or (b) materially impair the
Company, IMS or IMA's ability to consummate the transactions contemplated
by this Agreement or the Purchase Agreement or to perform their obligations
under this Agreement or the other Transaction Agreements.
(iii) No Material Adverse Effect. Since the Most Recent Balance Sheet
Date, there shall not have been a Material Adverse Effect.
(iv) Consents and Approvals. The Company and PGIO shall have received
evidence, in form and substance reasonably satisfactory to them, that all
consents and approvals of third parties set forth in Section 3.3(a) of the
Disclosure Schedule or otherwise required under any Business Contract (in
each case pursuant to written instruments in form and substance reasonably
satisfactory to PGIO and without payment of any consideration by the
Company or PGIO) or from any Governmental Entity in connection with this
Agreement, the other Transaction Agreements and the transactions
contemplated hereby and thereby, have been obtained and are in full force
and effect except for any such consents and approvals the absence of which
would not (a) have a Material Adverse Effect, or (b) materially impair the
operation of the CD Business.
(v) Officers' Certificate. IMS shall have delivered to PGIO a
certificate, dated the Closing Date and signed by its chief executive
officer and chief financial officer, confirming the satisfaction of the
conditions set forth in Section 6.2(i), (ii) and (iii) and such other
matters as may be reasonably requested by PGIO.
(vi) Transaction Agreements. Each of IMS, IMA (and, as applicable,
Subsidiaries thereof) and the Company shall have executed and delivered
each Transaction Agreement to which it is a party.
Section 6.3 Conditions to IMS's Obligation. The obligations of IMS to
enter into and complete the Closing is subject to the satisfaction (or express
written waiver by PGIO) on or prior to the Closing Date of the following
conditions:
(i) Performance. All the terms, covenants, agreements and conditions
of this Agreement and the Purchase Agreement to be complied with and
performed by PGIO on or before the Closing Date shall have been complied
with and performed prior to or on the Closing Date except where the failure
to so perform would not materially impair PGIO's ability to consummate the
transactions contemplated by this Agreement or to perform their obligations
under this Agreement or the other Transaction Agreements.
(ii) Governmental Consents and Approvals. IMS and IMA shall have
received evidence, in form and substance reasonably satisfactory to it,
that consents of
37
Governmental Entities required in connection with this Agreement, the other
Transaction Agreements and the transactions contemplated hereby and
thereby, have been obtained and are in full force and effect except for any
such consents and approvals the absence of which would not materially
impair PGIO or the Company's ability to consummate the transactions
contemplated by this Agreement and the Purchase Agreement or to perform
their obligations under this Agreement or the other Transaction Agreements.
(iii) Transaction Agreements. PGIO or its Affiliates shall have
executed and delivered each Transaction Agreement to which it is a party.
ARTICLE 7
INDEMNIFICATION
Section 7.1 Indemnification of PGIO. From and after the Closing, IMS
shall indemnify PGIO and its Affiliates and the Company (each, a "PGIO
Indemnified Party") against and hold each PGIO Indemnified Party harmless from
any and all Losses suffered or incurred by any such PGIO Indemnified Party
arising from, relating to or otherwise in connection with:
(i) any breach or inaccuracy of any representation or warranty of IMS
contained in this Agreement or in the certificates furnished by IMS under
Section 6.2(v);
(ii) any breach or failure to perform any covenant or agreement of IMS
or IMA contained in this Agreement;
(iii) the operation of the CD Business at any time during the period
prior to the Closing (except for Assumed Liabilities);
(iv) a claim by any third Person that any product of the Company, or
the making, using, selling, offering for sale or importing of any such
product, has infringed or is infringing the Intellectual Property of such
Person the subject matter of which relates to lateral flow technology,
including but not limited to, components and processes used to implement
lateral flow technology;
(v) any liability of IMS or its Affiliates related to an Excluded
Asset and any liability that is not an Assumed Liability, including the
Excluded Liabilities, including the cost of extinguishing any Permitted
Lien or Permitted IP Lien securing any such Excluded Liabilities;
(vi) the operation of the Excluded Businesses;
(vii) any liability or obligation of IMS or its Affiliates to fund or
finance any pension or similar liabilities; and
(viii) any liability arising out of the operation of the IMA
Facilities;
provided that no PGIO Indemnified Party shall be entitled to be indemnified
pursuant to clause (i) above unless the aggregate of all Losses for which IMS
would, but for this proviso, be liable under clause (i) above or under Section
7.1(i) of the Purchase Agreement or under similar
38
provisions of a purchase or contribution agreement in connection with the sale
or contribution to US CD LLC of a portion of the CD Business exceeds on a
cumulative basis $3,250,000 (the "IMA Indemnity Threshold"), at which point each
PGIO Indemnified Party shall be entitled to be indemnified for the aggregate
Losses and not just amounts in excess of the IMA Indemnity Threshold (except
that the foregoing proviso shall not apply to any breach of the representations
and warranties set forth in Sections 3.1, 3.2, 3.3, 3.4 and 3.15, or to any act
of fraud); provided, further, that IMS's aggregate liability pursuant to clause
(i) of this Section 7.1 together with any other liability for indemnification
for breach of representation and warranty made by IMS or IMA under the Purchase
Agreement or under a purchase or contribution agreement in connection with the
sale or contribution to US CD LLC of a portion of the CD Business shall not
exceed $81,250,000.
Section 7.2 Indemnification of IMS. From and after the Closing, the
Company shall indemnify IMS and its Affiliates (each, an "IMA Indemnified
Party") against and hold each IMA Indemnified Party harmless from any and all
Losses suffered or incurred by any such IMA Indemnified Party arising from,
relating to or otherwise in connection with:
(i) any failure to perform any covenant or agreement of the Company
contained in this Agreement;
(ii) the operation of the CD Business (other than with respect to
Excluded Liabilities or Excluded Assets) at any time at and after the
Closing; or
(iii) any Assumed Liability.
Section 7.3 Indemnification Claims. (a) In order for an Indemnified
Party to be entitled to any indemnification provided for under Section 7.1 or
7.2 in respect of, arising out of or involving, a Third Party Claim, such
Indemnified Party must notify the Indemnifying Party in writing of the Third
Party Claim (including in such notice a brief description of the applicable
claims, including damages sought or estimated, to the extent actually known by
the Indemnified Party) within 20 Business Days after receipt by such Indemnified
Party of notice of such Third Party Claim (a "Claim Notice"); provided that
failure to give such notification shall not affect the indemnification provided
under Section 7.1 or 7.2 except to the extent the Indemnifying Party has been
actually prejudiced as a result of such failure. Thereafter, the Indemnified
Party shall deliver to the Indemnifying Party, within 10 Business Days after the
Indemnified Party's receipt thereof, copies of all notices and documents
received by the Indemnified Party relating to such Third Party Claim.
(b) The Indemnifying Party will be entitled to participate in the
defense thereof and, if it so chooses, to assume the defense thereof (at the
sole cost and expense of the Indemnifying Party) with counsel selected by the
Indemnifying Party; provided that (i) the Indemnifying Party provides the
Indemnified Party notice of its election to assume the defense of such Third
Party Claim within 15 days of receipt of the applicable Claim Notice, (ii) the
Indemnifying Party has the financial resources to pay damages that could
reasonably be expected to arise from such Third Party Claim, and (iii) such
counsel selected by the Indemnifying Party is reasonably satisfactory to the
Indemnified Party. Should the Indemnifying Party so elect to assume the defense
of a Third Party Claim, the Indemnifying Party will not be liable to the
Indemnified Party under this Section 7.3 for any legal expenses subsequently
incurred by the
39
Indemnified Party in connection with the defense thereof other than reasonable
costs of investigation or of assistance as contemplated by this Section 7.3;
provided that (1) if the Indemnified Party reasonably determines, after
conferring with its counsel, that it is advisable for the Indemnified Party to
be represented by separate counsel due to actual or potential conflicts of
interest, the Indemnified Party shall have the right to employ counsel (limited
to one law firm) to represent it and in that event the fees and expenses of such
separate counsel shall be paid by the Indemnifying Party, and (2) the
Indemnifying Party shall be liable for the reasonable fees and expenses of
counsel employed by the Indemnified Party for any period during which the
Indemnifying Party has not assumed the defense thereof (other than during any
period in which the Indemnified Party shall have failed to give the Claim Notice
as provided above). If the Indemnifying Party assumes such defense, the
Indemnified Party shall have the right to participate in the defense thereof and
to employ counsel, at its own expense (except as otherwise provided herein),
separate from the counsel employed by the Indemnifying Party, it being
understood that the Indemnifying Party shall control such defense. If the
Indemnifying Party assumes the defense of the Third Party Claim, it will be
conclusively established for purposes of this Agreement and the Purchase
Agreement that the claims made in that Third Party Claim are within the scope
and subject to indemnification pursuant to this Article 7. Notwithstanding the
foregoing, the Indemnifying Party shall not be entitled to assume the defense of
any Third Party Claim (and shall be liable for the reasonable fees and expenses
of counsel incurred by the Indemnified Party in defending such Third Party
Claim) if the Third Party Claim seeks an order, injunction or other equitable
relief or relief for other than money damages against the Indemnified Party
which the Indemnified Party reasonably determines, after conferring with its
counsel, cannot be separated from any related claim for money damages. The
indemnification required by Section 7.1 or 7.2, as the case may be, shall be
made by prompt payments of the amount thereof during the course of the
investigation or defense, as and when bills are received or the indemnifiable
Loss is incurred. If the Indemnifying Party chooses to defend or prosecute a
Third Party Claim, all the parties hereto reasonably necessary for such defense
or prosecution shall reasonably cooperate in the defense or prosecution thereof,
which cooperation shall include (upon the Indemnifying Party's reasonable
request) the provision to the Indemnifying Party of records and information
which are reasonably relevant to such Third Party Claim, and making employees
available on a mutually convenient basis to provide additional information and
explanation of any material provided hereunder. If the Indemnifying Party
chooses to defend or prosecute any Third Party Claim, the Indemnified Party will
agree to any settlement, compromise or discharge of such Third Party Claim which
the Indemnifying Party may recommend and which by its terms obligates the
Indemnifying Party to pay the full amount of liability in connection with such
Third Party Claim; provided that, without the Indemnified Party's consent, the
Indemnifying Party shall not consent to entry of any judgment or enter into any
settlement (x) that provides for injunctive or other nonmonetary relief
affecting the Indemnified Party or (y) that does not include as an unconditional
term thereof the giving by each claimant or plaintiff to such Indemnified Party
of a release from all liability with respect to such Third Party Claim. If the
Indemnifying Party shall have assumed the defense of a Third Party Claim, the
Indemnified Party shall not admit any liability with respect to, or settle,
compromise or discharge, such Third Party Claim without the Indemnifying Party's
prior written consent (which consent shall not be unreasonably withheld).
(c) In order for an Indemnified Party to be entitled to any
indemnification provided for under this Agreement other than in respect of,
arising out of or involving a Third
40
Party Claim, such Indemnified Party shall deliver notice of such claim with
reasonable promptness to the Indemnifying Party (including in such notice a
brief description of the applicable claims, including damages sought or
estimated, to the extent actually known by the Indemnified Party); provided that
failure to give such notification shall not affect the indemnification provided
under Section 7.1 or 7.2 except to the extent the Indemnifying Party has been
actually prejudiced as a result of such failure.
Section 7.4 Survival. (a) All representations, warranties, covenants
and agreements of IMS shall survive the execution and delivery hereof and the
Closing hereunder. Except for those representations and warranties (x) in
Sections 3.1, 3.2, 3.3, 3.8, 3.9 (the first sentence thereof only) and 3.25, all
of which representations and warranties shall survive without limitation and (y)
in Sections 3.12, 3.14, 3.18 and 3.21, all of which shall survive for the
applicable statute of limitations, all representations and warranties of IMS and
IMA shall terminate and expire with respect to any theretofore unasserted claim,
on the second anniversary of the Closing Date; provided that to the extent
applicable or related to Business Intellectual Property Controlled but not owned
by IMS or IMA or one of their respective Subsidiaries pursuant to a license from
a third party, the representations and warranties in Section 3.12 shall survive
for so long as IMS's, IMA's or such Subsidiary's rights in such Business
Intellectual Property exist.
Section 7.5 Sole and Exclusive Remedy. The sole and exclusive remedy
of an Indemnified Party with respect to any and all claims arising out of, in
connection with or relating to the subject matter of this Agreement will be
pursuant to the indemnification provisions set forth in Article 5 hereof, this
Article 7, and without duplication, Articles 5 and 7 of the Purchase Agreement;
provided that nothing in this Section 7.5 will prohibit claims by the
Indemnified Party for equitable relief, common law fraud and intentional
misrepresentation.
ARTICLE 8
TERMINATION
Section 8.1 Termination. This Agreement may be terminated, and the
transactions contemplated hereby abandoned, at any time prior to the Closing,
only simultaneously with a termination of the Purchase Agreement and as provided
below:
(a) by mutual written consent of PGIO and IMA;
(b) by either PGIO or IMA, (i) if the Closing has not occurred by
September 30, 2007 or, if on such date all conditions to the parties'
obligations to consummate the Closing in Article 6 (other than those which by
their nature are satisfied on the Closing Date) have been satisfied or waived
other than the condition set forth in Section 6.1(i), November 30, 2007 (the
"Outside Date"), unless the failure to effect the Closing is the result of a
material breach of this Agreement or the Purchase Agreement by the party seeking
to terminate this Agreement; (ii) if any Governmental Entity issues an order,
decree or ruling or takes any other action permanently enjoining, restraining or
otherwise prohibiting the Closing hereunder or under the Purchase Agreement and
such order, decree, ruling or other action shall have become final and
nonappealable; or (iii) if any condition to the obligation of such party to
consummate the Closing hereunder or under the Purchase Agreement becomes
incapable of satisfaction prior to the Outside Date; provided in each case that
the terminating party is not then in material breach of
41
any representation, warranty or covenant contained in this Agreement or the
Purchase Agreement;
(c) by PGIO, if IMS or IMA breaches or fails to perform in any
material respect any of their representations, warranties or covenants contained
in this Agreement or the Purchase Agreement, which breach or failure to perform
would give rise to a failure to satisfy the conditions set forth in Section
6.2(i) or Section 6.2(ii) hereof or of the Purchase Agreement and cannot be or
has not been cured within 30 days after the giving of written notice to IMA of
such breach or the Outside Date, if earlier (provided that PGIO is not then in
material breach of any representation, warranty or covenant contained in the
Purchase Agreement and that neither PGIO nor the Company is then in material
breach of any representation, warranty or covenant contained in this Agreement);
or
(d) by IMS, if PGIO breaches or fails to perform in any material
respect of any of their representations, warranties or covenants contained in
this Agreement or the Purchase Agreement, which breach or failure to perform
would give rise to a failure to satisfy the condition set forth in Section
6.3(i) hereof or of the Purchase Agreement and cannot be or has not been cured
within 30 days after the giving of written notice to PGIO and the Company of
such breach or the Outside Date, if earlier (provided that neither IMA nor IMS
is then in material breach of any representation, warranty or covenant in this
Agreement or the Purchase Agreement).
Section 8.2 Effect of Termination. In the event of termination of this
Agreement as provided in Section 8.1, this Agreement shall forthwith become void
and have no effect, without any liability or obligation on the part of PGIO or
IMS, other than Sections 4.5, 4.11, 4.12, this Section 8.2 and Article 9 which
provisions shall survive such termination, and except to the extent that such
termination results from the willful and material breach by a party of any
representation, warranty or covenant set forth in this Agreement.
Section 8.3 Amendment. This Agreement may be amended by the parties
hereto at any time; provided that this Agreement may not be amended except by an
instrument in writing signed on behalf of each of the parties.
Section 8.4 Extension; Waiver. At any time prior to the Closing, the
parties may (a) extend the time for the performance of any of the obligations or
other acts of the other parties, (b) waive any inaccuracies in the
representations and warranties of another party contained in this Agreement or
in any document delivered pursuant to this Agreement or (c) waive compliance
with any of the agreements or conditions of another party contained in this
Agreement. Any agreement on the part of a party to any such extension or waiver
shall be valid only if set forth in an instrument in writing signed on behalf of
such party. The failure of any party to this Agreement to assert any of its
rights under this Agreement or otherwise shall not constitute a waiver of such
rights.
42
ARTICLE 9
GENERAL PROVISIONS
Section 9.1 Notices. All notices, requests, claims, demands, waivers
and other communications under this Agreement shall be in writing and shall be
by facsimile, courier services or personal delivery to the following addresses,
or to such other addresses as shall be designated from time to time by a Party
in accordance with this Section 9.1:
if to PGIO:
c/o Procter & Xxxxxx RHD, Inc.
Xxx Xxxxxxx & Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxx 00000
Attention: Corporate Secretary
Facsimile: 000-000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxxxx & Xxxxxxx LLP
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxx
Facsimile: 000-000-0000
if to IMS or IMA:
00 Xxxxxx Xxxx
Xxxxx 000
Xxxxxxx, XX 00000
Attention: Office of the General Counsel
Facsimile:000-000-0000
with a copy (which shall not constitute notice) to:
Xxxxxxx Procter LLP
Xxxxxxxx Xxxxx
Xxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxx
Facsimile: 000-000-0000
All notices and communications under this Agreement shall be deemed to have been
duly given (x) when delivered by hand, if personally delivered, (y) one Business
Day after when delivered to a courier, if delivered by commercial one-day
overnight courier service or (z) when sent, if sent by facsimile, with an
acknowledgment of sending being produced by the sending facsimile machine.
43
Section 9.2 Definitions. The following capitalized terms have the
following meanings:
"Affiliate" means, with respect to any Person, a Person who is an
"affiliate" of such first Person within the meaning of Rule 405 under the
Securities Act of 1933, as amended. For purposes of this definition, a Person
shall be deemed to control another Person if it owns or controls 50% or more of
the voting equity of the other Person (or other comparable ownership if the
Person is not a corporation); provided that solely for purposes of this
Agreement, the Company shall not be deemed to be an "Affiliate" of any party
hereto (or such parties' other Affiliates).
"Business Contract" means any Contract arising or resulting primarily
from or related primarily to the CD Business except for an Excluded Contract.
"Business Day" means any day other than a Saturday or Sunday or a day
on which banking institutions located in New York City are permitted or required
by Law, executive order or decree of a Governmental Entity to remain closed.
"Business Registered Intellectual Property" means any and all
Intellectual Property owned by IMS or IMA that is exclusively used in the CD
Business and consisting of (i) patents, patent applications (including
provisional applications), (ii) registered trademarks, applications to register
trademarks, intent-to-use applications, or other registrations or applications
related to trademarks and (iii) registered copyrights and applications for
copyright registration.
"Code" means the Internal Revenue Code of 1986, as amended.
"Constitutive Documents" means (i) with respect to a Person that is a
corporation, such Person's certificate or articles of incorporation and by-laws,
(ii) with respect to a Person that is a limited liability company, such Person's
certificate of formation and operating or limited liability company agreement,
(iii) with respect to a Person that is a partnership, such Person's partnership
agreement, (iv) with respect to a Person that is a trust, such Person's trust
instrument or agreement, and (v) with respect to a Person that is a legal entity
(including one of the type described in clauses (i) through (iv)), any
constitutive document of such entity or other document or Contract analogous to
those described in clauses (i) through this clause (v).
"Contingent Obligation" means, as applied to any Person, any direct or
indirect liability of that Person with respect to any Indebtedness, lease,
dividend, guaranty, letter of credit or other obligation, contractual or
otherwise (the "primary obligation") of another Person (the "primary obligor"),
whether or not contingent, (a) to purchase, repurchase or otherwise acquire such
primary obligations or any property constituting direct or indirect security
therefor, (b) to advance or provide funds (i) for the payment or discharge of
any such primary obligation, or (ii) to maintain working capital or equity
capital of the primary obligor or otherwise to maintain the net worth or
solvency or any balance sheet item, level of income or financial condition of
the primary obligor, (c) to purchase property, securities or services primarily
for the purpose of assuring the owner of any such primary obligation of the
ability of the primary obligor to make payment of such primary obligation, or
(d) otherwise to assure or hold harmless the owner of any
44
such primary obligation against loss or failure or inability to perform in
respect thereof. The amount of any Contingent Obligation shall be deemed to be
an amount equal to the stated or determinable amount of the primary obligation
in respect of which such Contingent Obligation is made or, if not stated or
determinable, the reasonably anticipated liability in respect thereof.
"Contract" means any loan or credit agreement, bond, debenture, note,
mortgage, indenture, guarantee, lease or other contract, commitment, agreement,
instrument, obligation, undertaking, license, permit, concession, franchise or
legally binding arrangement or understanding, whether written or oral.
"Control" or "Controlled" means, when used with respect to any
intellectual property right or other intangible property, and only in such case,
the possession or right of use (whether by license or ownership, or by control
over a Subsidiary having possession or right of use by license or ownership) by
a Person of the ability to grant to the other Person access, right of use or a
license or sublicense as provided herein without violating the terms of any
written contract with any third party.
"Environmental Law" means any applicable Law and legally binding
administrative or judicial interpretations thereof relating to (i) pollution,
the protection of the environment (including indoor and outdoor air, surface
water, groundwater, wetlands, drinking water supply, surface or subsurface
land), natural resources or health and safety or (ii) the exposure to, or the
manufacture, handling, use, emission, storage, recycling, treatment, generation,
discharge, transportation or disposal of, the release or threatened release of,
or the removal or remediation of Hazardous Materials.
"Environmental Liability" means any and all Losses arising from or
relating to: (i) failure to comply with any requirement of an Environmental Law;
(ii) failure to obtain, maintain in effect or comply with any required
Environmental Permit; (iii) actual or alleged obligation to undertake
environmental investigation, risk assessment, monitoring, remediation or
restoration or (iv) harm or injury, actual or alleged, to any real property, to
any Person, to public health, or to any natural resource as caused by any
Hazardous Material.
"Environmental Permits" means all permits, licenses, certificates,
registrations approvals or authorizations issued or required by any
Environmental Law, held by IMS or IMA facilities that will be used to
manufacture products for the Company under the Manufacturing Agreement.
"Governmental Entity" means any nation, state, province, county, city
or political subdivision and any official, agency, arbitrator, authority, court,
department, commission, board, bureau, instrumentality or other governmental
entity of any thereof, whether domestic or foreign.
"Hazardous Materials" means, whether alone or in combination, any and
all materials (including without limitation substances, chemicals, compounds,
mixtures, products or byproducts, wastes, pollutants and contaminants) that are
(i) listed, identified, licensed, prohibited, controlled, or regulated pursuant
to Environmental Law; (ii) identified or classified as "hazardous," "toxic,"
"dangerous," "pollutant," "contaminant," "explosive," "corrosive," "flammable,"
"radioactive," "reactive" or "special waste"; (iii) oils, petroleum, petroleum
45
products, wastes or byproducts, asbestos or asbestos containing materials,
nuclear materials, lead-based paint, polychlorinated biphenyls, urea
formaldehyde or explosives; or that could at some level require investigation,
risk assessment, monitoring, removal, treatment or remediation or otherwise give
rise to liability under any Environmental Law.
"IMA Facilities" means those manufacturing facilities owned, operated
or leased by IMA or its Subsidiaries that are used in the production of
products.
"Indebtedness" of any Person means, without duplication, (i) all
indebtedness of such Person for borrowed money, with respect to deposits or
advances of any kind or for the deferred purchase price of property or services
(other than current trade liabilities incurred in the Ordinary Course of
Business and payable in accordance with customary practices and not more than 90
days past due), (ii) all obligations (except for trade payables) of such Person
evidenced by bonds, debentures, notes or similar instruments, (iii) all
obligations of such Person upon which interest charges are customarily paid,
(iv) all obligations of such Person under conditional sale or other title
retention agreements relating to property or assets purchased by such Person,
(v) all Indebtedness of others secured by (or for which the holder of such
Indebtedness has an existing right, contingent or otherwise, to be secured by)
any Lien on property owned or acquired by such Person, whether or not the
obligations secured thereby have been assumed, (vi) all guarantees by such
Person of Indebtedness of others, (vii) all capital lease obligations of such
Person, (viii) all obligations of such Person in respect of interest rate
protection agreements, foreign currency exchange agreements, caps or collar
agreements or other interest or exchange rate hedging arrangements either
generally or under specific contingencies, (ix) all obligations of such Person
as an account party in respect of letters of credit and banker's acceptances,
(x) all obligations of such Person consisting of overdrafts (e.g., cash float
reflected as a negative on the cash line), (xi) all obligations of such Person
pursuant to any deferred compensation agreements and (xii) any Contingent
Obligation of such Person.
"Indemnified Party" means either a PGIO Indemnified Party or a IMA
Indemnified Party.
"Indemnifying Party" means (i) with respect to a claim for
indemnification pursuant to Section 7.1, IMS; and (ii) with respect to a claim
for indemnification pursuant to Section 7.2(a), the Company.
"Intellectual Property" means any or all of the following (in each
case in any domestic or foreign jurisdiction): (i) patents (including utility
patents, xxxxx patents, design patents and certificates of invention) and
applications therefor (including provisional, non-provisional, converted
provisional and continued prosecution applications) and all reissues,
reexaminations, revalidations, divisionals, renewals, extensions or restorations
(including any supplementary protection certificate and the like), provisionals,
continuations and continuations-in-part thereof; (ii) inventions, discoveries
and ideas (whether patentable or not), (iii) trade secrets, proprietary
information, know how, confidential information, technology, technical data, and
all documentation relating to any of the foregoing and rights to limit the use
of disclosure thereof by any Person; (iv) copyrights, copyright registrations
and applications therefor and all other rights corresponding thereto, and
writings and other works that are the subject matter of such copyrights; (v)
trade names, trademarks, service marks, brand names, certification marks,
46
trade dress and other indications of origin, the goodwill associated with the
foregoing, and the registrations and applications for registration of any of the
foregoing; (vi) databases and data collections and all rights therein; (vii)
computer software including all source code, object code, firmware, development
tools, files, records and data, and all media on which any of the foregoing is
recorded and (viii) Web addresses, sites and domain names.
"Knowledge" means, in the case of the Company, IMS, and IMA actual
knowledge of the employees listed in Section 9.2(a) of the Disclosure Schedule
assuming each such employee has the knowledge that an employee in a similar
position would reasonably be expected to have.
"Losses" means any debts, obligations and other liabilities (whether
known or unknown, absolute or contingent, liquidated or unliquidated, due or to
become due, accrued or not accrued, asserted or unasserted or otherwise),
losses, claims, damages, Taxes, diminutions in value, interest obligations,
deficiencies, Judgments, assessments, fines, fees, penalties and expenses
(including amounts paid in settlement, interest, court costs, fees and expenses
of attorneys, accountants, financial advisors, consultants, investigators and
other experts and other expenses of litigation).
"Material Adverse Effect" means any change, circumstance, development,
state of facts, event or effect (i) that has had or would reasonably be expected
to have a material adverse change or effect (taken alone or in the aggregate
with any other adverse change or effect) in or with respect to the business,
assets, condition (financial or otherwise), or results of operations of the CD
Business other than (a) changes, circumstances, developments, state of facts,
events or effects that affect the U.S. or global economy or capital or financial
markets generally, including changes in interest or exchange rates, (b) changes
in general legal, tax, regulatory, political or economic conditions that, in
each case, generally affect the industries in which the CD Business operates,
(c) acts of war or terrorism or natural disasters, provided that in the case of
clauses (b) and (c) above, the CD Business is not disproportionately affected by
such changes, circumstances, developments, state of facts, events or effects as
compared to the industries in which it operates, taken as a whole; or (ii) that
could reasonably be expected to have a material adverse effect on IMS's ability
to perform its obligations under this Agreement and the other Transaction
Agreements.
"Permitted IP Liens" means those Liens with respect to Business
Intellectual Property as set forth on Schedule 3.12(a).
"Permitted Liens" means the following, to the extent not securing
Indebtedness: (i) statutory Liens for Taxes not yet due or payable; (ii) Liens
for assessments and other governmental charges or Liens of landlords, carriers,
warehousemen, mechanics and repairmen incurred in the Ordinary Course of
Business, in each case for sums not yet due and payable or due but not
delinquent or being contested in good faith by appropriate proceedings, (iii)
Liens incurred in the Ordinary Course of Business in connection with workers'
compensation, unemployment insurance and other types of social security, and
(iv) Liens set forth in the terms of any Business Contract (except for any Lien
securing Indebtedness) that do not detract the value of, or impair the use of,
such Business Contract.
47
"Person" means an individual, corporation, partnership, limited
liability company, joint venture, association, trust, unincorporated
organization or other entity or any Governmental Entity.
"Product" means each human diagnostics and monitoring product that is
being formulated, developed, manufactured, packaged, tested, marketed,
distributed or sold by or on behalf of IMS or IMA, in each case, as part of the
CD Business.
"Purchased Asset" shall have the meaning ascribed to such term in the
Purchase Agreement.
"Representatives" means, with respect to a Person, such Person's
legal, financial, internal and independent accounting and other advisors and
representatives.
"Share" has the meaning ascribed to it in the Shareholder Agreement.
"Shareholders" means PGIO and IMS and all other Persons who become
shareholders of the Company in accordance with the terms of the Shareholder
Agreement, and the term "Shareholder" shall mean any of them.
"Subsidiary" means, with respect to any Person, is an Affiliate
controlled by such Person directly, or indirectly through one or more
intermediaries.
"Tax" means: (i) any United States federal, state, local and foreign
income, profits, excise, franchise, license, capital, transfer, ad valorem,
wage, severance, occupation, import, custom, gross receipts, payroll, sales,
value added, recording, registration, intangible, documentary, goods and
services, real estate, franchise, employment, use, stamp, alternative or add-on
minimum, environmental, withholding and any other tax, duty, assessment or
governmental tax charge of any kind whatsoever, imposed or required to be
withheld by any taxing authority; (ii) any interest, additions to tax, or
penalties applicable or related thereto and (iii) any amount described in clause
(i) or (ii) for which a Person is liable as a successor or transferee, or by
Contract, indemnity or otherwise.
"Tax Return" means any return, declaration, report, claim for refund,
or information return or statement or other form relating to Taxes filed or
required to be filed with a Governmental Entity, including any schedule or
attachment thereto, and including any amendment thereof.
"Third Party Claim" means any Legal Proceeding, claim or demand by a
Person other than a Person from which indemnification may be sought under
Article 7.
"Trademarks" means trade names, trademarks, service marks, brand
names, certification marks, trade dress and other indications of origin, the
goodwill associated with the foregoing, and the registrations and applications
for registration of any of the foregoing.
"Transaction Agreements" means, collectively, this Agreement, the
Purchase Agreement, the Guarantee, the Shareholder Agreement, the License
Agreements, the Finished
48
Product Purchase Agreement, the Distribution Arrangements, the Transition
Services Agreement and the PGIO Contribution Agreement.
"Transferred Employee" means each employee of IMA, IMS or one of their
respective Affiliates who is hired by the Company.
Section 9.3 Descriptive Headings; Certain Interpretations. The table
of contents and headings contained in this Agreement are for reference purposes
only and shall not control or affect the meaning or construction of this
Agreement. Except where expressly stated otherwise in this Agreement, the
following rules of interpretation apply to this Agreement: (i) "or" is not
exclusive and "include", "includes" and "including" are not limiting; (ii)
"hereof", "hereto", "hereby", "herein" and "hereunder" and words of similar
import when used in this Agreement refer to this Agreement as a whole and not to
any particular provision of this Agreement; (iii) "date hereof" refers to the
date of this Agreement; (iv) "extent" in the phrase "to the extent" means the
degree to which a subject or other thing extends, and such phrase does not mean
simply "if"; (v) definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms; (vi) references to an
agreement or instrument mean such agreement or instrument as from time to time
amended, modified or supplemented; (vii) references to a Person are also to its
permitted successors and assigns; (viii) references to an "Article", "Section",
"Clause", "Exhibit" or "Schedule" refer to an Article of, a Section or Clause
of, or an Exhibit or Schedule to, this Agreement; (ix) words importing the
masculine gender include the feminine or neuter and, in each case, vice versa
and (x) references to a Law include any amendment or modification to such Law
and any rules or regulations issued thereunder, whether such amendment or
modification is made, or issuance of such rules or regulations occurs, before or
after the date of this Agreement.
Section 9.4 Assignment. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned, in whole or in part, by
operation of Law or otherwise by any of the parties hereto without the prior
written consent of the other parties hereto. Any purported assignment without
such consent shall be void. Subject to the preceding sentence, this Agreement
shall be binding upon, inure to the benefit of and be enforceable by, the
parties hereto and their respective successors and assigns.
Section 9.5 Specific Enforcement. The parties hereto agree that
irreparable damage would occur in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that the parties hereto shall be
entitled to an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions of this Agreement, this
being in addition to any other remedy to which they are entitled at Law, in
equity or otherwise.
Section 9.6 Entire Agreement. The Transaction Agreements contain the
entire agreement and understanding between the parties hereto with respect to
the subject matter hereof and thereof and supersede all prior agreements and
understandings, both written and oral, with respect to the transactions
contemplated thereby.
Section 9.7 No Third-Party Beneficiaries. This Agreement is for the
sole benefit of the parties hereto and their permitted successors and assigns
and nothing herein
49
express or implied shall give or be construed to give to any Person, other than
the parties hereto and such successors and assigns, any legal or equitable
rights or remedies.
Section 9.8 Counterparts. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same agreement
and shall become effective when one or more counterparts have been signed by
each of the parties hereto and delivered to the other parties hereto. Delivery
of an executed counterpart of this Agreement by facsimile or other electronic
transmission shall be as effective as delivery of a manually executed
counterpart of this Agreement.
Section 9.9 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of New York, regardless of
the laws that might otherwise govern under applicable principles of conflicts of
laws thereof.
Section 9.10 Arbitration. (a) In the event that a material dispute
relating to this Agreement arises between the parties, good faith discussions
and negotiations shall be conducted by a designated management representative of
each party to resolve such dispute. If such representatives are unable to
resolve the dispute within 10 Business Days after the initial request for
negotiations at this level, then the matter shall be referred to the most senior
executive officer of each of party, who shall attempt, through good faith
negotiations and discussions, to resolve the dispute within five Business Days
immediately following such initial 10 Business Day period. If the dispute is not
resolved within the aforementioned five Business Day period, then the matter may
be submitted for binding arbitration as provided in Section 9.10(b). This
Section 9.10(a) shall not apply to or limit the right of a party to seek a
temporary restraining order or other provisional or permanent remedy to preserve
the status quo or to prevent irreparable harm.
(b) Except as otherwise provided in this Agreement, any controversy or
claim arising out of or relating to this Agreement, or the breach hereof, that
has not been resolved in accordance with Section 9.10(a) shall be settled by
binding arbitration in the following manner:
(i) If a party intends to commence arbitration to resolve a dispute
arising under this Agreement, such party shall provide written notice (the
"Arbitration Request") to the other party of such intention and the issues
for resolution. Within one Business Day after the receipt of the
Arbitration Request, the other party may, by written notice, add additional
issues for resolution, provided that such issues are eligible for
arbitration under this Section 9.10(b).
(ii) Arbitration shall be held in the continental US under the CPR
Rules for Non-Administered Arbitration. The arbitration shall be conducted
by three arbitrators who are knowledgeable in the subject matter at issue
in the dispute. One arbitrator will be selected by PGIO, one arbitrator
will be selected by IMS, and the third arbitrator will be selected by
mutual agreement of the two arbitrators selected by the parties. Each party
shall submit to such arbitrators its proposed ruling and remedy for each
issue that is the subject of arbitration. The arbitrators shall, within 15
days after the conclusion of the arbitration hearing, issue a written award
and statement of decision describing the essential findings and conclusions
on which the award is based, including the calculation of any damages
awarded. Any such award and decision shall reflect the proposed ruling
50
and remedy of one of the parties as to each disputed issue. The arbitrators
shall be authorized to award compensatory damages, but shall not be
authorized to award non-economic damages or punitive damages, or to reform,
modify or materially change this Agreement or any other agreements
contemplated hereunder. The arbitrators shall also be authorized to grant
any temporary, preliminary or permanent equitable remedy or relief the
arbitrators deem just and equitable and within the scope of this Agreement,
including an injunction or order for specific performance. The award of the
arbitrators shall be the sole and exclusive remedy of the parties (except
for any other remedies set forth in this Agreement). The arbitrators may
proceed to an award, notwithstanding the failure of either party to
participate in the proceedings. Judgment on the award rendered by the
arbitrators may be enforced in any court having competent jurisdiction
thereof, subject only to revocation on grounds of fraud or clear bias on
the part of the arbitrators.
Section 9.11 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule or Law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
materially adverse to any party. Upon such determination that any term or other
provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the
original intent of the parties hereto as closely as possible in an acceptable
manner to the end that transactions contemplated hereby are fulfilled to the
extent possible.
Section 9.12 Nonassignable Contracts. (a) In the event that the
transactions contemplated by this Agreement involve the assignment of rights
under any contract, agreement, license, claim, or of other rights, assets, or
property, which are nonassignable without the consent, authorization or approval
of the other party or parties thereto or any other third party (a "Nonassignable
Contract"), and such consent, authorization or approval shall not have been
obtained by IMS or IMA prior to the Closing Date, then, notwithstanding anything
in this Agreement to the contrary (and without relieving IMS or IMA of any
liability or obligation it may have under this Agreement), any such
Nonassignable Contract shall not be assigned (except any rights to receive
payments thereunder) until all such necessary consents, authorizations and
approvals with respect to such Nonassignable Contract shall have been obtained,
whereupon IMS or IMA shall, without further consideration, promptly assign or
cause the assignment of same to the Company.
(b) Until such time, if any, as all the necessary consents,
authorizations and approvals shall have been obtained for the assignment of a
Nonassignable Contract, IMS or IMA, at its own expense, shall retain, preserve
and hold in trust for the sole benefit of the Company all rights, interests and
claims with respect to such Nonassignable Contract from and after the Closing
Date. IMS or IMA shall use commercially reasonable efforts to obtain such
consents, authorizations and approvals and shall, at the request of PGIO or the
Company, use commercially reasonable efforts to take such actions, enter into
such arrangements and do or cause to be done such things, as shall be reasonably
requested by PGIO or the Company to provide, make available and secure for the
Company's benefits all of the funds, income and payments that would have inured
to the Company upon an outright assignment of such Nonassignable Contract to the
extent permitted by Law and by contract. Except as provided by
51
Law or the Nonassignable Contract in question, the performance obligations of
IMS or IMA under such Nonassignable Contract as shall arise both (x) exclusively
in respect of periods from and after the date on which the aforesaid funds are
so made available thereunder and (y) exclusively in connection with the
exploitation of such funds by the Company, shall be deemed to be sublicensed or
subcontracted to the Company but only until such time (if any) as the rights
under such Nonassignable Contract have been effectively assigned to the Company.
IMS and IMA shall pay over to the Company any amounts received by them after the
Closing Date in respect of any Nonassignable Contract, and the Company shall pay
over to IMS and IMA any amounts paid, or expenses incurred, by them in
performing any Nonassignable Contract after the Closing Date.
[SIGNATURE PAGE FOLLOWS]
52
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the day and year first herein above written.
INVERNESS MEDICAL SWITZERLAND GmbH
By: /s/ Xxxx X. Xxxxxx
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
PROCTER & XXXXXX INTERNATIONAL
OPERATIONS, SA
By: /s/ Xxxxxxx X. Xxxxxxx
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
IMJV GmbH
By: /s/ Xxxx X. Xxxxxx
------------------------------------
Name:
----------------------------------
Title:
---------------------------------
[SIGNATURE PAGE TO CONTRIBUTION AGREEMENT]
