EXECUTION
PURCHASE AGREEMENT
dated as of
August 18, 1997
between
ADVANCED NMR SYSTEMS, INC.
and
GENERAL ELECTRIC COMPANY
TABLE OF CONTENTS
Page
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ARTICLE I
TRANSACTIONS . . . . . . . . . . . 1
Section 1.1 Purchase and Sale of Assets; Grant of
License . . . . . . . . . . . . . . . . . 1
Section 1.2 Issuance and Sale of Preferred Shares . . . 2
Section 1.3 Settlement and Release Agreement. . . . . . 3
ARTICLE II
CLOSING; DELIVERIES . . . . . . . . . 3
Section 2.1 Closing . . . . . . . . . . . . . . . . . . 3
Section 2.2 Delivery of Purchased Assets; Proprietary
Rights . . . . . . . . . . . . . . . . . 4
ARTICLE III
CONDITIONS OF CLOSING . . . . . . . . . 4
Section 3.1 Conditions Precedent to Obligations of the
Company. . . . . . . . . . . . . . . . . 4
Section 3.2 Conditions Precedent to Obligations of the
Purchaser. . . . . . . . . . . . . . . . 4
Section 3.3 Additional Conditions Precedent. . . . . . 5
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY . . . 7
Section 4.1 Corporate Existence and Power . . . . . . . 8
Section 4.2 Authorization; Contravention . . . . . . . 8
Section 4.3 Approvals . . . . . . . . . . . . . . . . . 8
Section 4.4 Binding Effect . . . . . . . . . . . . . . 8
Section 4.5 Financial Information . . . . . . . . . . . 9
Section 4.6 Litigation . . . . . . . . . . . . . . . . 9
Section 4.7 Compliance with Laws . . . . . . . . . . . 9
Section 4.8 Capitalization . . . . . . . . . . . . . . 9
Section 4.9 Purchased Assets; Proprietary Rights . . . 10
Section 4.10 SEC Documents . . . . . . . . . . . . . . 11
Section 4.11 Continuing Representations and
Warranties . . . . . . . . . . . . . . . 12
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER . . . . . . . . . . 12
Section 5.1 Corporate Existence and Power . . . . . . . 12
Section 5.2 Authorization; Contravention . . . . . . . 12
Section 5.3 Approvals . . . . . . . . . . . . . . . . . 13
Section 5.4 Binding Effect. . . . . . . . . . . . . . . 13
Section 5.5 Litigation. . . . . . . . . . . . . . . . . 13
Section 5.6 Compliance with Laws. . . . . . . . . . . . 13
Section 5.7 Investment Intent. . . . . . . . . . . . . 13
Section 5.8 Limited Warranties. . . . . . . . . . . . 14
Section 5.9 Continuing Representations and Warranties . 14
ARTICLE VI
COVENANTS . . . . . . . . . . . . 14
Section 6.1 Affirmative Covenants of the Company . . . 14
Section 6.2 Negative Covenants of the Company . . . . . 15
Section 6.3 Additional Covenants of the Parties . . . . 16
Section 6.4 Covenant Not to Compete. . . . . . . . . . 18
ARTICLE VII
INDEMNIFICATION . . . . . . . . . . 18
Section 7.1 Indemnification by the Company . . . . . . 18
Section 7.2 No Limitation on Other Rights of Recovery . 21
ARTICLE VIII
MISCELLANEOUS . . . . . . . . . . . 21
Section 8.1 Expenses. . . . . . . . . . . . . . . . . . 21
Section 8.2 Notices. . . . . . . . . . . . . . . . . . 22
Section 8.3 No Waivers; Remedies; Specific
Performance. . . . . . . . . . . . . . . 22
Section 8.4 Amendments, Etc . . . . . . . . . . . . . . 22
Section 8.5 Successors and Assigns; Third Party
Beneficiaries . . . . . . . . . . . . . . 22
Section 8.6 Governing Law . . . . . . . . . . . . . . . 23
Section 8.7 Counterparts; Effectiveness . . . . . . . . 23
Section 8.8 Severability of Provisions . . . . . . . . 23
Section 8.9 Headings and References . . . . . . . . . . 23
Section 8.10 Entire Agreement . . . . . . . . . . . . . 23
Section 8.11 Survival . . . . . . . . . . . . . . . . . 23
Section 8.12 Dispute Resolution . . . . . . . . . . . . 24
Section 8.13 Affiliate. . . . . . . . . . . . . . . . . 26
Section 8.14 Non-Recourse. . . . . . . . . . . . . . . 26
ANNEX
Annex A - Definitions
EXHIBITS
Exhibit A - Form of Certificate of Designations
Exhibit B - Form of Registration Rights Agreement
Exhibit C - From of Stockholders Agreement
Exhibit D - Form of Settlement and Release Agreement
Exhibit E - Form of Assignment and Assumption Agreement
Exhibit F - Form of Xxxx of Sale
Exhibit G - Form of License Agreement
Exhibit 3.1(j)(1) - Certificate of Secretary of the Company
or the Purchaser
Exhibit 3.1(j)(2) - Certificate of Officer of the Company or
the Purchaser
Exhibit 3.1(j)(4) - Opinion of Counsel for the Company
Exhibit 3.1(j)(5) - Opinion of Counsel for the Purchaser
SCHEDULES
Schedule 1.1(a)(1) - Inventory
Schedule 1.1(a)(2) - Equipment
Schedule 1.1(a)(3) - Assigned Agreements
Schedule 1.1(b) - Proprietary Rights
Schedule 1.1(c)(2) - Assumed Warranty Obligations
Schedule 4.9(h) - Suppliers
PURCHASE AGREEMENT
PURCHASE AGREEMENT dated as of August 18, 1997 between
ADVANCED NMR SYSTEMS, INC., a Delaware corporation (the
"Company"), and GENERAL ELECTRIC COMPANY, a New York corporation
(the "Purchaser").
Terms not otherwise defined in this Agreement have the
meanings stated in Annex A.
The parties agree as follows:
ARTICLE I
TRANSACTIONS
SECTION 1.1 PURCHASE AND SALE OF ASSETS; GRANT OF
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LICENSE. Subject to the terms and conditions set forth in this
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Agreement, at the Closing,
(a) the Company shall sell, transfer, assign,
convey and deliver to the Purchaser, and the Purchaser shall
purchase, accept and acquire from the Company, in each case as
the same shall exist on the Closing Date, the following assets
(collectively, the "Purchased Assets"):
(1) the inventory listed on Schedule 1.1(a)(1);
(2) the equipment listed on Schedule 1.1(a)(2);
(3) the "Assigned Agreements" listed on Schedule
1.1(a)(3); and
(4) any equipment and inventory subsequently delivered
pursuant to Section 6.1(f) hereof;
(b) the Company shall grant to the Purchaser a
limited, non-transferable (except as set forth therein), paid up,
worldwide and perpetual license (the "License") under each of the
proprietary rights listed in Schedule 1.1(b) and all rights of
the Company, if any, in patents or applications of the Company
which may claim priority to any of the patents or applications
listed in Schedule 1.1(b), and all rights of the Company, if any,
with respect to service marks, trade names, copyrights, trade
secrets, know-how or inventions primarily used in the
manufacturing, sale or service of the Purchased Assets
(collectively, the "Proprietary Rights") to make, have made,
import, offer to sell, sell or otherwise dispose of any product
or service, including, without limitation, magnetic resonance
scanners, and to use, copy, modify and develop derivative works
of any product or service, which License shall include rights to
access, incorporate or use in any way the associated know-how for
the manufacturing and servicing of any product; and
(c) in consideration of such sale of the
Purchased Assets by the Company to the Purchaser and the grant of
the License and the sale of the Preferred Shares referred to
below by the Company to the Purchaser, (i) the Purchaser shall
pay to the Company, and the Company shall accept from the
Purchaser, the amount of $5,132,580.00, which shall be paid by
wire transfer at the time of such sale, and (ii) the Purchaser
shall assume, and become liable for the timely payment or other
performance in full of, the following obligations and liabilities
of the Company (collectively, but excluding all obligations and
liabilities of the Company not expressly referred below, the
"Assumed Liabilities"):
(1) the obligations and liabilities of the Company
under each of the Assigned Agreements, in each case arising
on and after the Closing Date; and
(2) the obligations and liabilities of the Company
with respect to warranties of the Company, express or
implied, through contract or by operation of law, with
respect to the equipment listed in Schedule 1.1(c)(2)
(excluding, for this purpose, obligations and liabilities
arising from claims of a type typically excluded under a
written warranty, such as negligence or misrepresentation
and any penal, incidental or consequential damages such as
lost profit or revenue); provided that the Purchaser shall
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not assume or otherwise become liable for the payment or
other performance of the obligations and liabilities of
the Company with respect to product liability, with respect
to such equipment;
which purchase price shall be allocated among the Purchased
Assets, the Licenses and the Preferred Shares in a manner
proposed by the Purchaser and approved by the Company, but which
purchase price shall in no event be less than the full amount of
the purchase price specified above. Notwithstanding anything to
the contrary, the Purchaser shall not become liable for any
obligations of the Company other than the Assumed Liabilities.
SECTION 1.2 ISSUANCE AND SALE OF PREFERRED SHARES.
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Subject to the terms and conditions set forth in this Agreement,
at the Closing,
(a) the Company shall issue, sell and deliver to
the Purchaser, and the Purchaser shall purchase, accept and
acquire from the Company, 27,000 shares of Series B Convertible
Redeemable Preferred Stock, par value $.01 per share (the
"Preferred Shares"), at a price of $100.00 per Preferred Share
(the "Preferred Share Price"), payable in cash,
(1) which Preferred Shares shall be issued pursuant to
a Certificate of Designations with respect to the
Certificate of Incorporation of the Company (the
"Certificate") in the form of Exhibit A attached hereto, and
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(2) upon the conversion of each of which Preferred
Share the Company shall issue and deliver to Purchaser a
number of shares of Common Stock, par value $.01 per share
(the "Common Stock"), of the Company as determined by the
Certificate (as such number of shares may be adjusted
pursuant to the Certificate, the "Preferred Conversion
Shares"), which conversion may be made from time to time
upon a change of control or after the date that is the first
anniversary of the Closing Date (the "First Anniversary")
but which in any event shall be made on the date that is the
tenth anniversary of the Closing Date (the "Tenth
Anniversary");
(b) the Company and the Purchaser shall execute
and deliver the Registration Rights Agreement substantially in
the form of Exhibit B attached hereto (the "Registration Rights
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Agreement"), pursuant to which the Company will grant to the
Purchaser and certain other persons certain rights with
respect to the registration under the Securities Act of the
disposition of the Preferred Conversion Shares; and
(c) the Company and the Purchaser shall execute
and deliver the Stockholders Agreement substantially in the form
of Exhibit C attached hereto (the "Stockholders Agreement"),
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pursuant to which the Company and the Purchaser will provide for
certain restrictions on the ownership, voting and disposition
of the Preferred Shares and the Preferred Conversion Shares
by the Purchaser and certain other persons and certain other
matters.
SECTION 1.3 SETTLEMENT AND RELEASE AGREEMENT. Subject
--------------------------------
to the terms and conditions set forth in this Agreement, at the
Closing, the Company and the Purchaser shall enter into the
Settlement and Release Agreement, substantially in the form of
Exhibit D attached hereto (the "Settlement and Release
----------
Agreement").
ARTICLE II
CLOSING; DELIVERIES
SECTION 2.1 CLOSING.
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(a) The closing of the Transactions shall take
place (the "Closing") on Monday, August 18, 1997 or, at the
election of the Company, on the second Business Day after the
conditions precedent to the obligations of the parties under this
Agreement with respect thereto shall have been satisfied or
waived, as the case may be, or on such other date as the parties
may agree in writing (the "Closing Date").
(b) The Closing shall take place at the offices
of O'Melveny & Xxxxx LLP, 000 Xxxx 00xx Xxxxxx, Xxx Xxxx, Xxx
Xxxx 00000 or at such other location as the parties may agree in
writing.
SECTION 2.2 DELIVERY OF PURCHASED ASSETS; PROPRIETARY
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RIGHTS.
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(a) At or promptly after the Closing, but in no
event later than 90 days after the Closing, and with reasonable
prior written notice to the Company, during normal business
hours, at its expense and without any cost or liability of the
Company, the Purchaser shall remove the Purchased Assets
specified in clauses (1) and (2) of Section 1.1(a) from the
premises of the Company at 00 Xxxxxxx Xxxx, Xxxxxxxxxx,
Xxxxxxxxxxxxx. From and after the Closing, the Purchaser shall
have all risk of loss and damage with respect to such Purchased
Assets, and the Company shall have no obligation to maintain or
insure such Purchased Assets for the benefit of the Purchaser or
any other person, except to use reasonable care pending removal
by the Purchaser.
(b) Promptly after the Closing, with reasonable prior
written notice to the Company, during normal business hours, at
its expense and without any cost or liability to the Company, the
Purchaser shall (1) copy the documents relating to the
Proprietary Rights at the premises of the Company at 00 Xxxxxxx
Xxxx, Xxxxxxxxxx, Xxxxxxxxxxxxx, and shall remove the copies from
such premises or (2) cause such documents to be copied under the
supervision of the Company by a vender of duplicating services
approved by the Company.
ARTICLE III
CONDITIONS OF CLOSING
SECTION 3.1 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE
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COMPANY. The obligations of the Company under this Agreement with
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respect to the Transactions are subject to the satisfaction of
each of the following conditions, unless waived by the Company,
at or before the Closing:
(a) the Purchaser shall have delivered to the
Company an amount in immediately available funds equal to the
aggregate purchase price for the Purchased Assets and the
Preferred Shares; and
(b) the Purchaser shall have executed and
delivered to the Company such agreements and other instruments,
substantially in the form of the xxxx of sale attached hereto as
Exhibit E, with such changes therein as shall be approved by the
---------
Company and the Purchaser, as may be required to assume the
Assumed Liabilities.
SECTION 3.2 CONDITIONS PRECEDENT TO OBLIGATIONS OF THE
------------------------------------------
PURCHASER. The obligations of the Purchaser under this Agreement
---------
with respect to the Transactions are subject to the satisfaction
of each of the following conditions, unless waived by the
Purchaser, at or before the Closing:
(a) the Company shall have executed and delivered
to the Purchaser such bills of sales, assignments and other
instruments of transfer, substantially in the form of the xxxx of
sale attached hereto as Exhibit F, with such changes therein as
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shall be approved by the Company and the Purchaser, as may be
required to sell, transfer, assign, convey and deliver to the
Purchaser the Purchased Assets, without representation or
warranty other than as expressly stated herein;
(b) the Company shall have executed and delivered
to Purchaser such licenses and other instruments, substantially
in the form of the license agreement attached hereto as Exhibit G,
---------
with such changes therein as shall be approved by the Company and
the Purchaser as may be required to grant to the Purchaser a
License under each of the Proprietary Rights, without
representation or warranty other than as expressly stated herein,
to make, have made, sell or otherwise dispose of any product or
service, including, without limitation, magnetic resonance
scanners; and
(c) the Company shall have executed and delivered
to the Purchaser one or more certificates representing the
Preferred Shares, which certificates shall bear the legends
stated in Section 4(b) of the Registration Rights Agreement and
Section 1.6 of the Stockholders Agreement, respectively.
SECTION 3.3 ADDITIONAL CONDITIONS PRECEDENT. The
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respective obligations of each party under this Agreement with
respect to the Transactions are also subject to the satisfaction
of each of the following conditions, unless waived by the party,
at or before the Closing:
(a) neither party (1) shall be in violation of or
default with respect to any Regulation of any Governmental Body
or any decision, ruling, order or award of any arbitrator
applicable to it or its business, properties or operations, (2)
would be in violation of or default with respect to the same in
connection with or as a result of the conclusion of the
Transactions, or (3) has received notice that, in connection with
or as a result of the conclusion of the Transactions, it is or
would be in violation of or default with respect to the same,
which violation or default, individually or in the aggregate,
would materially and adversely affect the ability of the party to
perform its material obligations under any Transaction Document
to which it is a party;
(b) no Action shall be pending or, to the
knowledge of either party, threatened against any party or, to
its knowledge, any other person that, individually or in the
aggregate, if determined adversely to the party or the other
person, would materially and adversely affect the ability of the
party to perform its material obligations under any Transaction
Document to which it is or may become a party;
(c) each party shall have obtained from each
Governmental Body or other person each Approval or taken all
actions required to be taken in connection with each Approval, in
each case with respect to an Approval that is required or
advisable on the part of that person for (1) the due execution
and delivery by that person of each Transaction Document to which
it is or may become a party, (2) the conclusion of the
Transactions, (3) the performance by that person of its
obligations under each Transaction Document to which it is or may
become a party, and (4) the exercise by that person of its rights
and remedies under each Transaction Document to which it is or
may become a party, which violation or default, individually or
in the aggregate, would materially and adversely affect the
ability of the party to perform its material obligations under
any Transaction Document to which it is or may become a party;
(d) the Certificate shall have been duly filed
with and accepted by the Secretary of State of the State of
Delaware and evidence thereof shall have been delivered to the
Company and the Purchaser;
(e) the other party shall have executed and
delivered the Registration Rights Agreement, dated as of the
Closing Date;
(f) the other party shall have executed and
delivered the Stockholders Agreement, dated as of the Closing
Date;
(g) the other party shall have executed and
delivered the Settlement and Release Agreement, dated as of the
Closing Date;
(h) the representations and warranties of the
other party contained in each Transaction Document to which it is
a party shall be true and correct in all material respects on and
as of the Closing Date with the same force and effect as though
made on and as of the Closing Date;
(i) the other party shall have performed, in all
material respects, all of its covenants and other obligations
required by each Transaction Document to be performed at or
before the Closing; and
(j) the party shall have received from the other
party the following, each dated the Closing Date, in form and
substance reasonably satisfactory to the party:
(1) a certificate of the Secretary or an Assistant
Secretary of such other party, substantially in the form of
Exhibit 3.1(j)(1), with respect to (i) the resolutions ofthe
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Board of Directors of such other party, approving each
Transaction Document to which such other party is a party
and the other documents to be delivered by it under the
Transaction Documents, and (ii) the names and true
signatures of the officers of such other party authorized to
sign each Transaction Document to which such other party is
a party and the other documents to be delivered by such
other party under the Transaction Documents;
(2) a certificate of the Chairman of the Board, the
President or a Vice President of such other party,
substantially in the form of Exhibit 3.1(j)(2) to the effect
-----------------
that (i) the representations and warranties of such other
party contained in the Transaction Documents to which it is
a party are true and correct in all material respects as of
the Closing Date and (ii) such other party has performed, in
all material respects, all covenants and other obligations
required by the Transaction Documents to which it is a party
to be performed by it at or before the Closing;
(3) with respect to the Company, a certificate of the
Secretary of State of the State of Delaware, dated as of a
recent date, as to the good standing of the Company and as
to the charter documents of the Company on file in the
office of the Secretary of State of the State of Delaware;
(4) with respect to the Company, a favorable opinion
of one or more counsel for the Company, which together are
substantially in the form of Exhibit 3.1(j)(4); and
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(5) with respect to the Purchaser, a favorable opinion
of one or more counsel for the Purchaser, which together are
substantially in the form of Exhibit 3.1(j)(5).
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants as follows, except
as otherwise described in Schedule IV:
SECTION 4.1 CORPORATE EXISTENCE AND POWER. The Company
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(1) is a corporation duly incorporated, validly existing and in
good standing under the laws of the State of Delaware and (2) has
all necessary corporate power and authority to execute, deliver
each Transaction Document to which it is or may become a party
and to perform its obligations thereunder.
SECTION 4.2 AUTHORIZATION; CONTRAVENTION. Subject to
----------------------------
the effectiveness of the Certificate, the execution and delivery
by the Company of each Transaction Document to which it is or may
become a party and the performance by it of its obligations under
each of those Transaction Documents have been duly authorized by
all necessary corporate action and do not and will not
(1) contravene, violate, result in a breach of or constitute a
default under, (A) its certificate of incorporation or bylaws,
(B) any Regulation of any Governmental Body or any decision,
ruling, order or award of any arbitrator by which the Company or
any Consolidated Subsidiary or any of their properties may be
bound or affected, or (C) any agreement, indenture or other
instrument to which the Company or any Consolidated Subsidiary is
a party or by which the Company or any Consolidated Subsidiary or
their properties may be bound or affected, or (2) except as
contemplated by the Transaction Documents, result in or require
the creation or imposition of any Lien on any of the properties
now owned or hereafter acquired by the Company or any
Consolidated Subsidiary, which contravention, violation, breach,
default or Lien, individually or in the aggregate, would have a
Material Adverse Effect.
SECTION 4.3 APPROVALS. Except with respect to the
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Approvals required to effect the Recapitalization and the
Certificate and the Approvals referred to in the Registration
Rights Agreement, no Approval of any Governmental Body or other
person is required or advisable on the part of the Company for
(1) the due execution and delivery by the Company of any
Transaction Document to which it is or may become a party, (2)
the conclusion of the Transactions, (3) the performance by the
Company of its obligations under each Transaction Document to
which it is or may become a party and (4) the exercise by the
Purchaser of its rights and remedies under each Transaction
Document, except for Approvals the failure to obtain which,
individually or in the aggregate, would not have a Material
Adverse Effect.
SECTION 4.4 BINDING EFFECT. Each Transaction Document
--------------
to which the Company is or may become a party is, or when
executed and delivered in accordance with this Agreement will be,
the legally valid and binding obligation of the Company,
enforceable against it in accordance with its terms, except as
may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws relating
to or affecting creditors' rights generally and general
principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing and the
possible unavailability of specific performance or injunctive
relief, regardless of whether considered in a proceeding in
equity or at law.
SECTION 4.5 FINANCIAL INFORMATION. The consolidated
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balance sheet of the Company and its Consolidated Subsidiaries as
of September 30, 1996 and the related consolidated statements of
operations, stockholders' equity and cash flows for the 12 months
then ended, reported on by Xxxxxxx X. Xxxxxx & Company, LLP and
filed with the Securities and Exchange Commission in the
Company's Annual Report on Form 10-K for the year ended September
30, 1996, a true and complete copy of which has been delivered to
the Purchaser, fairly present the consolidated financial position
of the Company and its Consolidated Subsidiaries as of that date
and their consolidated results of operations and cash flows for
the year then ended, in accordance with GAAP applied on a
consistent basis except as described in the footnotes to the
financial statements included in such Form 10-K.
SECTION 4.6 LITIGATION. There is no Action pending or,
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to the knowledge of each of the Company and its Consolidated
Subsidiaries, threatened against the Company or a Consolidated
Subsidiary that involves any of the Transactions, the Purchased
Assets, the Proprietary Rights or the Preferred Shares and that,
individually or in the aggregate, if determined adversely to any
of them, would have a Material Adverse Effect.
SECTION 4.7 COMPLIANCE WITH LAWS. None of the Company
--------------------
and its Consolidated Subsidiaries is in, and none of them has
received notice of, a violation of or default with respect to,
any Regulation of any Governmental Body or any decision, ruling,
order or award of any arbitrator applicable to it or its
business, properties or operations, including individual products
or services sold or provided by it and the Purchase Assets, the
Assigned Agreements and the Proprietary Rights, except for
violations or defaults that, individually or in the aggregate,
will not have a Material Adverse Effect.
SECTION 4.8 CAPITALIZATION.
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(a) The authorized capital stock of the Company
consists of (1) 50,000,000 shares of Common Stock and (2)
1,000,000 shares of Preferred Stock, par value $.01 per share.
(b) As of August 1, 1997, there were (1)
43,747,628 shares of Common Stock issued and outstanding, (2)
225,000 shares of Common Stock held in the treasury of the
Company, (3) 3,423,102 shares of Common Stock reserved for
issuance upon exercise of the warrants (collectively, the
"Warrants") issued and outstanding pursuant to the Warrant
Agreement dated August 31, 1995 between the Company and American
Stock Transfer & Trust Company, as Warrant Agent and (4)
2,456,006 shares of Common Stock reserved for issuance upon
exercise of outstanding stock options issued by the Company to
current and former employees of the Company and its Consolidated
Subsidiaries (the "Employee Options"); and since August 1, 1997,
there has been no material change in any of the foregoing.
(c) Except with respect to the Employee Options,
the Warrants, the Merger Agreement and the Transaction Documents,
there are no outstanding securities, options, warrants, calls,
rights, commitments, agreements, arrangements or undertakings of
any kind to which the Company is a party obligating the Company
to issue, deliver or sell, or cause to be issued, delivered or
sold, additional shares of capital stock or other Equity
Securities of the Company or obligating the Company to issue,
grant, extend or enter into any such security, option, warrant,
call, right, commitment, agreement, arrangement or undertaking.
(d) All outstanding shares of capital stock of
the Company are, and all shares of Common Stock that may be
issued pursuant to the exercise of the Warrants or the Employee
Options or the conversion of the Preferred Shares (if the same
shall be issued and sold pursuant to this Agreement), as the case
may be, will be, when issued, and all Preferred Shares (if the
same shall be issued and sold pursuant to this Agreement) will
be, when issued, duly authorized, validly issued, fully paid and
nonassessable.
(e) Under the circumstances contemplated by this
Agreement and assuming the accuracy of the representations of
Purchaser in Article 5, the offer, issuance, sale and delivery of
the Preferred Shares will not, under current laws and
regulations, require compliance with the prospectus delivery or
registration requirements of the Securities Act.
SECTION 4.9 PURCHASED ASSETS; PROPRIETARY RIGHTS.
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(a) The Company has good title to each of the
Purchased Assets and the interests created by the Proprietary
Rights, free and clear of all Liens.
(b) The Company has good right, full power and
lawful authority to sell, transfer, assign, convey and deliver to
Purchaser each of the Purchased Assets and the interests created
by the Proprietary Rights, free and clear of all Liens. The
Company has caused to be delivered to the Purchaser true and
complete copies of the Assigned Agreements.
(c) The right, title and interest of the Company
in and to each of the Purchased Assets and the interests created
by the Proprietary Rights are free and clear of all Liens, except
as may be provided to the contrary in the terms and conditions of
the respective Assigned Agreements and the Proprietary Rights.
Immediately after the sale, transfer, assignment, conveyance and
delivery of the Purchased Assets at the Closing, the Purchaser,
its successors and assigns will have good title to each of the
Purchased Assets free and clear of all Liens.
(d) Each of the Assigned Agreements has, to the
knowledge of the Company with respect to parties other than the
Company, been duly authorized, executed and delivered by all
parties to each Assigned Agreement, is in full force and effect
and constitutes the legal, valid and binding obligations of the
parties to each Assigned Agreement or their respective successors
or assigns, enforceable against them in accordance with the terms
of each Assigned Agreement, except as may be limited by
bankruptcy, insolvency, reorganization, fraudulent conveyance,
moratorium or other similar laws relating to or affecting
creditors' rights generally and general principles of equity,
including, without limitation, concepts of materiality,
reasonableness, good faith and fair dealing and the possible
unavailability of specific performance or injunctive relief,
regardless of whether considered in a proceeding in equity or at
law. As of the date of this Agreement, (1) there is no material
liability or obligation of the Company with respect to any
Assigned Agreement that, under the terms of such Assigned
Agreement, is required to be paid or otherwise performed, but
that has not been paid or otherwise performed in full and (2)
there is no material default under any Assigned Agreement by any
party.
(e) As of the date of this Agreement, (1) the
Company has not received notice that the validity of any
Proprietary Right or its title to or use of any Proprietary Right
is being questioned in any Action and (2) there is no material
obligation or liability of the Company with respect to any
Proprietary Right that is required to be paid or otherwise
performed or is required to have been paid or otherwise
performed, in each case as of the date of this Agreement, but
that has not been paid or otherwise performed.
(f) The Purchased Assets specified in clauses (1)
and (2) of Section 1.1(a) are located at the premises of the
Company specified in Schedules 1.1(a)(1) and 1.1(a)(2),
respectively, with respect thereto. The documents relating to
the Proprietary Rights are located at the premises of the Company
specified in Schedule 1.1(b) with respect thereto True and
complete copies of all of the Assigned Agreements are attached
hereto as a part of Schedule 1.1(a)(3). The prepaid revenues
under the Assigned Agreements do not exceed $33,000 in the
aggregate.
(g) None of the Assigned Agreements contains a
prohibition on assignment to the Purchaser. The conclusion of
the Transactions will not (and will not give any person a right
to) terminate or modify any rights of, or accelerate or increase
any obligation of, the Company or the Purchaser under any of the
Assigned Agreements and the Proprietary Rights.
(h) Schedule 4.9(h) lists all suppliers to the
Company of parts for performing the Assigned Agreements. No
notice of termination has been given to the Company by any
supplier listed on Schedule 4.9(h).
(i) To the Company's knowledge, Schedule
1.1(a)(1) lists all inventory in the Company's possession that is
primarily used in the manufacturing or service of InstaScan or 3T
or 4T whole-body magnetic resonance scanners. To the Company's
knowledge, Schedule 1.1(a)(2) lists all equipment in the
Company's possession that is primarily used in the manufacturing
or service of InstaScan or 3T or 4T whole-body magnetic resonance
scanners.
Section 4.10 SEC Documents. The Company has timely
-------------
filed with the Securities and Exchange Commission all reports,
schedules, forms, statements and other documents required by the
Exchange Act to be filed by the Company since January 1, 1995
(collectively, and in each case including all exhibits and
schedules thereto and documents incorporated by reference
therein, the "SEC Documents"). The Company has delivered or made
available to the Purchaser true and complete copies of all SEC
Documents. As of their respective dates, except to the extent
revised or superseded by a subsequent filing with the Securities
and Exchange Commission, the SEC Documents complied in all
material respects with the requirements of the Securities Act or
the Exchange Act, as the case may be, and none of the SEC
Documents (including any and all financial statements included
therein) as of such dates contained any untrue statement of a
material fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading. The consolidated financial statements of
the Company and the Consolidated Subsidiaries included in all SEC
Documents, including any amendments thereto (collectively, the
"SEC Financial Statements"), comply as to form in all material
respects with applicable accounting requirements and the
published rules and regulations of the Securities and Exchange
Commission with respect thereto.
SECTION 4.11 CONTINUING REPRESENTATIONS AND WARRANTIES.
-----------------------------------------
Each of the representations and warranties made with respect to
the Company or a Consolidated Subsidiary in this Agreement or in
any other Transaction Document as of any date other than the
Closing Date shall be true and correct in all material respects
on and as of the Closing Date except as otherwise contemplated by
such Transaction Document, and except that the Company will
prepare and deliver to the Purchaser such updates or other
revisions of the written disclosures referred to in this Article
IV as have been delivered by the Company to the Purchaser as
shall be necessary in order to make each of such written
disclosures correct and complete in all material respects on and
as of the Closing Date. The requirement to prepare and deliver
updates or other revisions of the written disclosures, and the
receipt by the Purchaser of information pursuant to Section
6.3(b) or otherwise on or before the Closing Date, shall not
limit the right of the Purchaser under Article III to require as
a condition precedent to the performance of its obligations under
this Agreement on the Closing Date the accuracy in all material
respects of the representations and warranties and the
performance in all material respects of the covenants of the
Company made in the Transaction Documents (without regard to such
updates or other revisions) and to receive an unqualified
certificate with respect to the same.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF THE PURCHASER
The Purchaser represents and warrants as follows:
SECTION 5.1 CORPORATE EXISTENCE AND POWER. The
-----------------------------
Purchaser (1) is a corporation duly incorporated, validly
existing and in good standing under the laws of the State of New
York and (2) has all necessary corporate power and authority to
execute and deliver each Transaction Document to which it is or
may become a party.
SECTION 5.2 AUTHORIZATION; CONTRAVENTION. The execution
----------------------------
and delivery by the Purchaser of each Transaction Document to
which it is or may become a party and the performance by it of
its obligations under each of those Transaction Documents have
been duly authorized by all necessary corporate action and do not
and will not contravene, violate, result in a breach of or
constitute a default under (1) its certificate of incorporation
or bylaws, (2) any Regulation or any decision, ruling, order or
award of any arbitrator by which the Purchaser or any of its
properties may be bound or affected or (3) any agreement,
indenture or other instrument to which it is a party or by which
it or its properties may be bound or affected, which
contravention, breach or default, individually or in the
aggregate, would materially and adversely affect the ability of
the Purchaser to perform its obligations under any Transaction
Document to which it is or may become a party.
SECTION 5.3 APPROVALS. Except with respect to such
---------
filings by the Purchaser as may be required pursuant to Sections
13(d) and 16(a) of the Exchange Act, no Approval of any
Governmental Body or other person is required or advisable on the
part of the Purchaser for (1) the due execution and delivery by
the Purchaser of any Transaction Document, (2) the conclusion of
the Transactions and (3) the performance by the Purchaser of its
material obligations under each Transaction Document to which it
is or may become a party.
SECTION 5.4 BINDING EFFECT. Each Transaction Document
--------------
to which the Purchaser is or may become a party is, or when
executed and delivered in accordance with this Agreement will be,
the legally valid and binding obligation of the Purchaser,
enforceable against it in accordance with its terms, except as
may be limited by bankruptcy, insolvency, reorganization,
fraudulent conveyance, moratorium or other similar laws relating
to or affecting creditors' rights generally and general
principles of equity, including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing and the
possible unavailability of specific performance or injunctive
relief, regardless of whether considered in a proceeding in
equity or at law.
SECTION 5.5 LITIGATION. There is no Action pending or,
----------
to the Purchaser's knowledge, threatened against the Purchaser
or, to its knowledge, any other person or that involves any of
the Transactions or any property owned, leased, licensed or used
by the Purchaser that, individually or in the aggregate, if
determined adversely to the party or the other person, would
materially and adversely affect the ability of the Purchaser to
perform its material obligations under any Transaction Document
to which it is or may become a party.
SECTION 5.6 COMPLIANCE WITH LAWS. The Purchaser is
--------------------
neither in, nor has received notice of a, violation of or default
with respect to any Regulation of any Governmental Body or any
decision, ruling, order or award of any arbitrator applicable to
it or its business, properties or operations, which violation or
default, individually or in the aggregate, would materially and
adversely affect the ability of the Purchaser to perform its
material obligations under any Transaction Document to which it
is or may become a party.
SECTION 5.7 INVESTMENT INTENT. The Purchaser
-----------------
acknowledges that the Company is issuing and selling the
Preferred Shares (and, upon conversion thereof, the Preferred
Conversion Shares) pursuant to the terms of the Transaction
Documents in reliance upon the exemption afforded by Section 4(2)
of the Securities Act for transactions by an issuer not involving
any public offering. The Purchaser represents that (1) it is
acquiring such securities for investment and without any view
toward distribution of any of the securities to any other person,
(2) it will not sell or otherwise dispose of the securities
except in compliance with the registration requirements or
exemption provisions under the Securities Act and (3) before any
sale or other disposition of any of such securities other than in
a sale registered under the Securities Act, or pursuant to Rule
144 under the Securities Act unless the Company shall have been
advised by counsel that the sale does not meet the requirements
of Rule 144 for the sale, it will deliver to the Company an
opinion of counsel reasonably satisfactory to the Company to the
effect that such registration is unnecessary.
SECTION 5.8 LIMITED WARRANTIES. The Purchaser
------------------
acknowledges that (1) the Purchaser is acquiring the Purchased
Assets, the Licenses and the Preferred Shares (and, upon the
conversion thereof, the Preferred Conversion Shares) pursuant to
this Agreement after having performed such due diligence and
investigations with respect to the Company, its Subsidiaries, the
Purchased Assets, the Licenses, the Proprietary Rights, the
Preferred Shares and the Preferred Conversion Shares that the
Purchaser, in its judgment, has determined to be appropriate,
(2) it is the intention of the parties that (A) the Purchaser
acquire the Purchased Assets and the Licenses without
representation or warranty by the Company, express or implied, on
an "as is, where is" basis, except as specifically set forth
herein, and (B) the Purchaser acquire the Purchased Assets, the
Licenses and the Preferred Shares (and, upon the conversion
thereof, the Preferred Conversion Shares) subject to the
provisions of Section 8.11, and (3) except as specified herein,
the Company is making no warranty of merchantability or
suitability for any purpose with respect to any of the Purchased
Assets, the Licenses and the Proprietary Rights.
SECTION 5.9 CONTINUING REPRESENTATIONS AND WARRANTIES.
------------------------------------------------------
Each of the representations and warranties made by the Purchaser
in this Agreement or in any other Transaction Document as of a
date other than the Closing Date shall be true on and as of the
Closing Date except as otherwise contemplated by the Transaction
Documents.
ARTICLE VI
COVENANTS
SECTION 6.1 AFFIRMATIVE COVENANTS OF THE COMPANY. The
------------------------------------
Company agrees that the Company shall do the following:
(a) Maintenance of Existence. At all times on or
------------------------
before the Closing Date, preserve and maintain its corporate
existence and good standing in the jurisdiction of its
incorporation and qualify and remain qualified as a foreign
corporation in each jurisdiction in which both (1) qualification
is required either (A) to own, lease, license or use its
properties now owned, leased, licensed or used and proposed to be
owned, leased, licensed or used or (B) to carry on its business
as now conducted or proposed to be conducted and (2) the failure
to be so qualified would have a Material Adverse Effect.
(b) Conduct of Business. At all times on or before
-------------------
the Closing Date, except as otherwise contemplated by the
Transaction Documents, continue to operate a business of the same
general type as conducted by it on the date of this Agreement in
the ordinary course, consistent with past practices; provided that
--------
the Company may cause or permit Advanced Mammography Systems,
Inc., a Delaware corporation ("AMS"), and a Wholly-Owned
Subsidiary of the Company to merge (the "Merger") pursuant to an
Agreement and Plan of Merger dated as of June 23, 1997 by and
among the Company, such Wholly-Owned Subsidiary and AMS, a true
and complete copy of which has been delivered to the Purchaser,
as the same may be amended or modified (the "Merger Agreement"),
or otherwise.
(c) Compliance with Laws. At all times on or
--------------------
before the Closing Date, comply in all respects with each
Regulation of all Governmental Bodies and each decision, ruling,
order or award of all arbitrators applicable to it or its
business, properties or operations, if a failure to comply with
any of the foregoing, individually or in the aggregate, would
have a Material Adverse Effect.
(d) NASDAQ SmallCap Market. Take all action
----------------------
required, if any, to cause the issuance of the Preferred Shares
to comply with the Corporate Governance Rules of the NASDAQ
SmallCap Market and the Preferred Conversion Shares to be
qualified for inclusion in the NASDAQ SmallCap Market and shall
give such notice as required, if any, to the National Association
of Securities Dealers, Inc. with respect to the Transaction
Documents and the Transactions.
(e) Access. Afford to the Purchaser, upon
------
reasonable prior written notice and during normal business hours,
reasonable access to (1) the Purchased Assets and to documents
relating to the Assigned Agreements, the Assumed Liabilities and
the Proprietary Rights, (2) personnel of the Company familiar
with any of the foregoing, with whom the Purchaser shall be
permitted to discuss the possibility of employment by the
Purchaser or its Affiliates after the Closing Date and (3) for a
180 day period following the Closing Date, provide such training
with respect to the Purchased Assets as the Purchaser may
reasonably request and provide such training and other assistance
as the Purchaser may reasonably request in connection with the
Purchaser's performance of the Assigned Agreements.
(f) Equipment and Inventory. If the Company
-----------------------
becomes aware within six months of closing that it is in
possession of additional equipment or inventory primarily related
to the manufacturing or servicing of InstaScan or 3T or 4T whole-
body magnetic resonance scanners, the Company will promptly
inform the Purchaser of the existence of such equipment or
inventory and Purchaser may take possession of such equipment or
inventory on the same basis as the other Purchased Assets
hereunder, provided that if Purchaser does not notify the Company
of its intention to take possession of such equipment or
inventory within one month of receiving notice by the Company,
the Company shall be entitled to declare such equipment or
inventory obsolete and dispose of it without further obligation
to Purchaser. For purposes of this paragraph, the terms
"equipment" and "inventory" shall include all hardware components
and copies of all software components thereof.
SECTION 6.2 NEGATIVE COVENANTS OF THE COMPANY. The
----------------------------------
Company agrees that, before the Closing Date and except as
contemplated by the Transaction Documents or with the prior
approval of the Purchaser, the Company shall not do any of the
following or enter into any agreement or other arrangement (other
than the Transaction Documents) with respect to any of the
following:
(a) Charter documents. Amend its articles of
-----------------
incorporation or certificate of incorporation, as the case may
be, or its bylaws, except in each case pursuant to the
Recapitalization or a transaction permitted by Section 6.2(b).
(b) Mergers, Etc. Merge or consolidate with any
------------
person, sell, lease, license or otherwise dispose of all or
substantially all of its assets (whether now owned or hereafter
acquired) to any person or acquire all or substantially all of
the assets or the business of any person, in each case whether in
one transaction or in a series of transactions, except that AMS
or a Consolidated Subsidiary may merge into or transfer assets to
the Company or a Wholly-Owned Consolidated Subsidiary, whether
pursuant to or in connection with the Merger or otherwise.
SECTION 6.3 ADDITIONAL COVENANTS OF THE PARTIES. Each
-----------------------------------
party shall do the following until the Closing and, with respect
to Section 6.3(f), indefinitely after the Closing:
(a) Best Efforts. Upon the terms and subject to
------------
the conditions provided in the Transaction Documents, use its
best efforts to take, or cause to be taken, all action, and to
do, or cause to be done, and to assist and cooperate with the
other party in doing all things necessary, proper or advisable to
ensure that the conditions set forth in Article III and to the
conclusion of the Transactions are satisfied and to conclude and
make effective, in the most expeditious manner practicable, the
Transactions, including, without limitation, (1) using its best
efforts to obtain all necessary Approvals and (2) in cooperation
with the other party, giving written notice of the Transactions
to persons in possession of the Purchased Assets and the parties
to the Assigned Agreements.
(b) Notification. Give prompt notice to the other
------------
party of (1) the occurrence, or failure to occur, of any event
that would be likely to cause any representation or warranty of
the party contained in the Transaction Document to be untrue or
inaccurate in any material respect at any time from the date of
this Agreement to the Closing Date and (2) any failure of the
party to perform or otherwise comply with, in any material
respect, any covenant, condition or agreement to be performed or
complied with by it under the Transaction Documents; which
covenant of notification shall not limit the right of the other
party under Article III to require as a condition precedent to
the performance of its obligations under this Agreement the
continuing accuracy and performance of the representations and
warranties and covenants of the notifying party made in the
Transaction Documents and to receive an unqualified certificate
with respect to the same.
(c) Publicity and Reports. The initial press
---------------------
release with respect to the Transactions shall be mutually
satisfactory to the parties hereto and thereafter, except as may
be required by applicable laws, court process or by obligations
pursuant to any listing agreement with a national securities
exchange or the NASDAQ/SmallCap Market, neither the Company nor
the Purchaser shall issue any press release or make any public
filings with respect to the Transactions, without affording the
other party the opportunity to review and comment upon such
release or filing.
(d) Confidentiality. Information disclosed by any
---------------
party or its representatives to any other party or its
representatives, whether before or after the date of this
Agreement, in connection with the Transactions or the discussions
and negotiations preceding the execution of the Transaction
Documents, shall be kept confidential by the other party and its
representatives and shall not be used by those persons other than
as contemplated by the Transaction Documents, except in each case
to the extent that (1) the information was known by the recipient
when received or the information is or hereafter becomes lawfully
obtainable from other sources, (2) disclosure to a Governmental
Body having jurisdiction over the parties is necessary or
appropriate, (3) disclosure may otherwise be required by
applicable Regulations or (4) the duty as to confidentiality is
waived in writing by the other party. If this Agreement is
terminated, each party shall use reasonable efforts to return
upon written request from the other party all documents (and
reproductions of those documents) received by it or its
representatives from the other party (and, in the case of
reproductions, all reproductions made by the receiving party)
that include information not within the exceptions contained in
the preceding sentence, unless the recipients provide assurances
reasonably satisfactory to the requesting party that the
documents have been destroyed.
(e) ANMR/GE Agreements. Neither party shall take
------------------
any action to enforce any of its rights under the ANMR/GE
Agreements (as defined in the form of Settlement and Release
Agreement attached hereto as Exhibit D) or otherwise with respect
to any matter subject thereto or arising therefrom, except as
specifically provided in the Settlement and Release Agreement.
(f) Further Assurances. Promptly upon request by
------------------
any other party, correct any defect or error that may be
discovered in any Transaction Document or in the execution or
acknowledgement of any Transaction Document and execute,
acknowledge, deliver, file, re-file, register and re-register,
any and all such further acts, certificates, assurances and other
instruments as the requesting party may require from time to time
in order (1) to carry out more effectively the purposes of each
Transaction Document, (2) to enable the requesting party to
exercise and enforce its rights and remedies and collect any
payments and proceeds under each Transaction Document and (3) to
better transfer, preserve, protect and confirm to the requesting
party the rights granted or now or hereafter intended to be
granted to the requesting party under each Transaction Document
or under each other instrument executed in connection with any
Transaction Document.
SECTION 6.4 COVENANT NOT TO COMPETE. (a) Before the
-----------------------
fifth anniversary of the Closing Date, the Company and its
Subsidiaries shall not manufacture, license, service or sell
magnetic resonance scanners that are designed for whole-body
imaging and have a magnetic field of 3T or greater ("Whole-Body
3T MR Scanners").
(b) Before the fourth anniversary of the Closing
Date, neither the Company nor any of its Subsidiaries shall enter
into service contracts with respect to magnetic resonance
scanners designed for whole body imaging and have a magnetic
field of less than 3T unless it first offers Purchaser the
opportunity to enter instead into such service contracts on
identical terms.
(c) Notwithstanding anything herein to the
contrary, Subsidiaries of the Company that are acquired by the
Company after the Closing Date ("Acquired Companies") may
manufacture, license, sell, or otherwise deal in Whole-Body 3T MR
Scanners and may enter into service contracts with respect to
magnetic resonance scanners designed for whole body imaging;
provided, however, that, (i) before the fifth anniversary of the
Closing Date, the Company shall not expand the business of any
Acquired Company so as to cause such Acquired Company to compete
with the Purchaser's Whole-Body 3T MR Scanner business or service
business in a manner or to an extent that such Acquired Company
did not compete with the Purchaser prior to such acquisition or
as was contemplated by the Acquired Company's business plan at
the time of acquisition; and (ii) before the fourth anniversary
of the Closing Date, Acquired Companies shall not solicit service
contracts with respect to magnetic resonance scanners designed
for whole body imaging from parties to the Assigned Agreements.
ARTICLE VII
INDEMNIFICATION
SECTION 7.1 INDEMNIFICATION BY THE COMPANY AND
----------------------------------
PURCHASER.
---------
(a) Subject to, and without limiting the effect
of, any term or provision of any Transaction Document that limits
the Purchaser's recourse against the Company in the event of a
failure by the Company to perform a certain covenant or agreement
specified therein, and whether or not the Closing or both shall
occur, and subject to Section 8.11, the Company shall indemnify
the Purchaser and its "controlling persons" (within the meaning
of Section 20 of the Exchange Act) and Subsidiaries and their
respective stockholders, directors, officers, employees, agents
and Affiliates against, and hold each of those persons harmless
from, any and all Losses in any way relating to or allegedly
arising out of any of the following:
(1) any breach of the representations, warranties,
covenants or agreements of the Company contained in any
Transaction Document, whether or not the Transactions are
concluded or the obligations of the parties under the
Transaction Documents are terminated;
(2) any other matter as to which the Company in other
provisions of this Agreement or any other Transaction
Document has agreed to indemnify any of those persons; or
(3) the failure of the Company to pay or otherwise
perform, timely and in full, any of its obligations and
liabilities with respect to the Purchased Assets arising
before the Closing other than the Assumed Liabilities.
(b) Subject to, and without limiting the effect
of, any term or provision of any Transaction Document that limits
the Company's recourse against the Purchaser in the event of a
failure by the Purchaser to perform a certain covenant or
agreement specified therein, and whether or not the Closing shall
occur, and subject to Section 8.11, the Purchaser shall indemnify
the Company and its "controlling persons" (within the meaning of
Section 20 of the Exchange Act) and Subsidiaries and their
respective stockholders, directors, officers, employees, agents
and Affiliates against, and hold each of those persons harmless
from, any and all Losses in any way relating to or allegedly
arising out of any of the following:
(1) any breach of the representations, warranties,
covenants or agreements of the Purchaser contained in any
Transaction Document, whether or not the Transactions are
concluded or the obligations of the parties under the
Transaction Documents are terminated;
(2) any other matter as to which the Purchaser in
other provisions of this Agreement or any other Transaction
Document has agreed to indemnify any of those persons; or
(3) the failure of the Purchaser to pay or otherwise
perform the Assumed Liabilities timely and in full.
(c) If any Action indemnifiable under this
Section shall be brought, asserted or threatened against any
person indemnified under this Section by any person other than
the indemnifying person, the indemnified person shall promptly
notify the indemnifying person. A failure to notify the
indemnifying person timely or at all shall reduce the liabilities
and obligations of the indemnifying person under this Section
only to the extent the indemnifying person actually shall be
prejudiced by such failure. The indemnifying person shall assume
the defense of the Action, including the employment of counsel
satisfactory to the indemnified person and the payment of all
related fees and expenses, but the indemnified person may employ
separate counsel in the Action and participate in the defense of
the Action at its own expense. However, the indemnified person
may by written notice to the indemnifying person assume the
defense of the Action, including the employment of counsel, at
the expense of the indemnifying person if:
(1) the indemnifying party shall have agreed to pay
those fees and expenses; or
(2) the indemnifying party shall have failed to assume
the defense of the Action or shall have failed to employ
counsel reasonably satisfactory to the indemnified person in
the Action; or
(3) the named parties to the Action (including any
impleaded parties) include both the indemnified person and
the indemnifying party, and the indemnified person shall
have been advised by counsel that there may be one or more
legal defenses available to the indemnified person that are
different from or additional to those available to the
indemnifying party (in which case, if the indemnified person
notifies the indemnifying party in writing that it elects to
employ separate counsel at the expense of the indemnifying
party, the indemnifying party shall not have the right to
assume the defense of such Action on behalf of the
indemnified person; it being understood, however, that the
indemnifying party shall not, in connection with any one
Action or separate but substantially similar or related
Actions in the same jurisdiction arising out of the same
general allegations or circumstances, be liable for the
reasonable fees and expenses of more than one separate firm
of attorneys at any time for all indemnified persons, which
firm shall be designated in writing by the principal
indemnified person).
The indemnifying party shall not be liable for any settlement of
any Action effected without its written consent, but if settled
with its written consent, or if there be a final judgment for the
plaintiff in any such Action, the indemnifying party shall
indemnify and hold harmless the indemnified person from and
against any loss or liability by reason of the settlement or
judgment.
(d) Notwithstanding anything in this Section to
the contrary, if, in connection with an Action indemnifiable
under this Section, a Governmental Body or other person having
authority or jurisdiction over a matter or matters related to the
Action shall have rendered, entered or granted a binding
judgment, decision, ruling, order or award with respect to the
matter or matters providing for the payment of money damages or
the claimant and the indemnifying party shall have agreed to
settle the Action for an amount of money damages without
reservation of any rights or defenses against the indemnified
person, and if the indemnified person elects to appeal the
judgment, decision, ruling, order or award or declines to agree
to the proposed settlement, as the case may be, then the
indemnified person may continue to defend the Action, free of any
participation by the indemnifying person, but the amount of any
ultimate liability of the indemnifying party under this Section
with respect to Losses related to or allegedly arising in
connection with the matter or matters that shall have been
comprehended by the judgment, decision, ruling, order or award or
by the proposed settlement, as the case may be, shall then be
limited to the amount of the judgment, decision, ruling, order or
award or the amount of the proposed settlement, as the case may
be, plus the other indemnified Losses of the indemnified person
relating to the matter or matters through the date of its
election to appeal or its rejection of the proposed settlement,
as the case may be.
(e) If the indemnification provided for in this
Section is unavailable to an indemnified person (other than by
reason of exceptions provided in this Section), or is
insufficient to hold harmless an indemnified person in respect of
any Loss then the indemnifying person, in lieu of indemnifying
the indemnified person, shall contribute to the amount paid or
payable by the indemnified person as a result of the Loss in the
proportion that is appropriate to reflect the relative fault of
the indemnifying person on the one part and of the indemnified
person on the other part in connection with the events or
circumstances which resulted in the Loss as well as any other
relevant equitable considerations. The relative fault of the
indemnifying person on the one part and of the indemnified person
on the other part shall be determined by reference to, among
other things, those persons' relative intent, knowledge, access
to information and opportunity to correct or prevent the events
or circumstances resulting in the Loss. The amount of any Loss
suffered, incurred or paid any person shall be deemed to include
all expenses incurred or paid by the person in connection with
investigating or defending any Action, including, but not limited
to, the fees and expenses of counsel.
SECTION 7.2 NO LIMITATION ON OTHER RIGHTS OF RECOVERY.
-----------------------------------------
The indemnification set forth in this Article shall be in
addition to any other obligations or liabilities of an
indemnifying person to an indemnified person at common law or
otherwise. The provisions of this Article shall not eliminate or
otherwise limit the right of any indemnified person or any other
person to seek to recover contribution, damages or otherwise
enforce its rights against the indemnifying person or any other
person without regard to the provisions of this Article. If at
any time all or any part of any indemnification payment hereunder
is or must be rescinded or returned to the person making such
indemnity payment for any reason whatsoever (including, without
limitation, the insolvency, bankruptcy or reorganization of any
person) the indemnification obligations of the person making such
payment shall be reinstated with respect to such payment so
rescinded or returned as though such payment had never been made
or received.
ARTICLE VIII
MISCELLANEOUS
SECTION 8.1 EXPENSES. Whether or not the Transactions
--------
are concluded, all costs and expenses incurred in connection with
the Transaction Documents and the Transactions shall be paid by
the party incurring such expenses.
SECTION 8.2 NOTICES. All notices, requests and other
-------
communications to any party or under any Transaction Document
shall be in writing. Communications may be made by telecopy or
similar writing. Each communication shall be given to the party
at its address stated on the signature pages of this Agreement or
at any other address as the party may specify for this purpose by
notice to the other party. Each communication shall be effective
(1) if given by telecopy, when the telecopy is transmitted to the
proper address and the receipt of the transmission is confirmed,
(2) if given by mail, 72 hours after the communication is
deposited in the mails properly addressed with first class
postage prepaid or (3) if given by any other means, when
delivered to the proper address and a written acknowledgement of
delivery is received.
SECTION 8.3 NO WAIVERS; REMEDIES; SPECIFIC PERFORMANCE.
------------------------------------------
(a) No failure or delay by any party in
exercising any right, power or privilege under any Transaction
Document shall operate as a waiver of the right, power or
privilege. A single or partial exercise of any right, power or
privilege shall not preclude any other or further exercise of the
right, power or privilege or the exercise of any other right,
power or privilege. The rights and remedies provided in the
Transaction Documents shall, subject to Section 8.12 hereof, be
cumulative and not exclusive of any rights or remedies provided
by law.
(b) In view of the uniqueness of the Transactions
and the business, properties, operations, prospects and condition
(financial and otherwise) of the Company and its Consolidated
Subsidiaries, neither of the parties would have an adequate
remedy at law for money damages in the event that any of the
Transaction Documents is not performed in accordance with its
terms, and therefore each of the parties agrees that the other
party shall, subject to Section 8.12 hereof, be entitled to
specific enforcement of the terms of each Transaction Document in
addition to any other remedy to which it may be entitled, at law
or in equity.
SECTION 8.4 AMENDMENTS, ETC. No amendment,
---------------
modification, termination, or waiver of any provision of any
Transaction Document, and no consent to any departure by a party
to a Transaction Document from any provision of the Transaction
Document, shall be effective unless it shall be in writing and
signed and delivered by the other parties to the Transaction
Document, and then it shall be effective only in the specific
instance and for the specific purpose for which it is given.
SECTION 8.5 SUCCESSORS AND ASSIGNS; THIRD PARTY
-----------------------------------
BENEFICIARIES.
-------------
(a) The Purchaser may assign to a Wholly-Owned
Subsidiary thereof its rights and delegate its obligations under
this Agreement before the Closing; such assignee shall accept
those rights and assume those obligations for the benefit of the
Company in writing in form reasonably satisfactory to the
Company. Thereafter, without any further action by any person,
all references in this Agreement to the "Purchaser", and all
comparable references, shall be deemed to be references to the
transferee, but the Purchaser shall not be released from any
obligation or liability under this Agreement.
(b) Except as provided in Section 8.5(a), no
party to this Agreement may assign its rights under the
Transaction Document. Any delegation in contravention of this
Section shall be void ab initio and shall not relieve the
-- ------
delegating party of any obligation under this Agreement.
(c) The provisions of each Transaction Document
shall be binding upon and inure to the benefit of the parties to
the Transaction Document and their respective successors and
permitted assigns, and no other person.
SECTION 8.6 GOVERNING LAW. Each Transaction Document
-------------
shall be governed by and construed in accordance with the
internal laws of the State of New York.
SECTION 8.7 COUNTERPARTS; EFFECTIVENESS. Each
---------------------------
Transaction Document may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if
all signatures were on the same instrument.
SECTION 8.8 SEVERABILITY OF PROVISIONS. Any provision
--------------------------
of any Transaction Document that is prohibited or unenforceable
in any jurisdiction shall, as to that jurisdiction, be
ineffective to the extent of the prohibition or unenforceability
without invalidating the remaining provisions of the Transaction
Document or affecting the validity or enforceability of the
provision in any other jurisdiction.
SECTION 8.9 HEADINGS AND REFERENCES. Article and
-----------------------
section headings in any Transaction Document are included in the
Transaction Document for the convenience of reference only and do
not constitute a part of the Transaction Document for any other
purpose. References to parties and articles and sections in any
Transaction Document are references to the parties to or the
articles and sections of the Transaction Document, as the case
may be, unless the context shall require otherwise.
SECTION 8.10 ENTIRE AGREEMENT. The Transaction
----------------
Documents embody the entire agreement and understanding of the
respective parties and supersede all prior agreements or
understandings with respect to the subject matters of those
documents, except that paragraph 4 of the Letter Agreement dated
June 11, 1997 between the Company and the Purchaser remains in
full force and effect.
SECTION 8.11 SURVIVAL. Except as otherwise specifically
--------
provided in any Transaction Document, and notwithstanding any
investigation or notice to the contrary or any waiver by any
other party of a related condition precedent to the performance
by the other party of an obligation under the Transaction
Document, (1) each representation and warranty of each party to
the Transaction Document contained in or made pursuant to the
Transaction Document shall survive the Closing and remain in full
force and effect until the date that is the first anniversary of
the Closing Date and (2) the other party may assert or commence
an Action against the party with respect to the breach of any
such representation or warranty of the party on or before such
date and may maintain any such Action thereafter; provided that
--------
(x) no representation or warranty of the Company set forth in
Sections 4.5, 4.6, 4.7, 4.9 (other than paragraphs (a), (b), (c)
and (f) thereof) and 4.10 shall survive the Closing, and the
Purchaser may not assert or commence an Action against the Company
with respect to a breach thereof after the Closing Date and (y) no
representation or warranty of the Purchaser set forth in Sections
5.5 and 5.6 shall survive the Closing, and the Company may not
commence an Action against the Purchaser with respect thereto
after the Closing Date. Each covenant or agreement of a party
to a Transaction Document required to be performed on or after
a Closing shall remain in full force and effect thereafter in
accordance with its terms.
SECTION 8.12 DISPUTE RESOLUTION. (a) General Provisions.
------------------
(i) Any dispute, controversy or claim arising out of or relating
to this Agreement or any related agreement or the validity,
interpretation, breach or termination thereof (a "Dispute"),
including claims seeking redress or asserting rights under
applicable law, shall be resolved in accordance with the
procedures set forth herein. Until completion of such
procedures, no party may take any action not contemplated herein
to force a resolution of the Dispute by any judicial, arbitral or
similar process, except to the limited extent necessary to (A)
avoid expiration of a claim that might eventually be permitted
hereby or (B) obtain interim relief, including injunctive relief,
to preserve the status quo or prevent irreparable harm.
(ii) All communications between the parties or their
representatives in connection with the attempted resolution
of any Dispute shall be deemed to have been delivered in
furtherance of a Dispute settlement and shall be exempt from
discovery and production, and shall not be admissible in
evidence (whether as an admission or otherwise), in any
arbitral or other proceeding for the resolution of the
Dispute.
(iii) In connection with any Dispute, the parties
expressly waive and forego any right to trial by jury.
(b) Consideration by Senior Executives. If a Dispute
----------------------------------
cannot be resolved at an operational level, either party may, by
notice to the other, request referral to the President and CEO of
the General Electric Medical Services Division and the Chairman
of the Company (or comparable officers of any permitted successor
or assignee) for their consideration. Such request shall be
accompanied by a written statement of the Dispute and of each
party's position. Within 30 days after the request, the other
party will either concur in such statement or prepare its own,
and such statement(s) will be delivered to the officers named
above. Such officers will meet in person or by telephone within
30 days thereafter to seek a resolution. If no resolution is
reached by the expiration of 60 days from the referral request,
then either party may submit the Dispute to resolution as further
provided herein by notice to the other party.
(c) Mediation. After completion of any prior procedures
---------
required hereby, either party may submit the Dispute for
resolution by mediation pursuant to the Center for Public
Resources Model Procedure for Mediation of Business Disputes as
then in effect. Mediation will continue for at least 60 days
unless the mediator chooses to withdraw sooner. At the request
of either party at commencement of the mediation, the mediator
will be asked to provide an evaluation of the Dispute and the
parties' relative positions.
(d) Arbitration. (i) After completion of any prior
-----------
procedures required hereby, either party may submit the Dispute
for resolution by arbitration pursuant to the Rules of the Center
for Public Resources ("CPR") for Non-Administered Arbitration of
Business Disputes as in effect at the time of the arbitration.
The parties consent to a single, consolidated arbitration for all
Disputes for which arbitration is permitted.
(ii) The neutral organization for purposes of the
CPR rules will be the CPR. The arbitral tribunal shall be
composed of one arbitrator selected by agreement of the
parties or, in the absence of such agreement within 60 days
after either party first proposes an arbitrator, by the CPR.
The arbitration shall be conducted in New York. Each party
shall be permitted to present its case, witnesses and
evidence, if any, in the presence of the other party. A
written transcript of the proceedings shall be made and
furnished to the parties. The arbitrators shall determine
the Dispute in accordance with the law of the State of New
York, without giving effect to any conflict of law rules or
other rules that might render such law inapplicable or
unavailable, and shall apply this Agreement according to its
terms.
(iii) The parties agree to be bound by any award or
order resulting from any arbitration conducted hereunder and
further agree that:
(1) any monetary award shall include pre-award interest,
to the extent appropriate, and shall be made and
payable in U.S. dollars through a bank selected by
the recipient of such award, free of any withholding
tax or other deduction, together with interest
thereon at the prime rate in effect at such bank on
the date of the award, from the date the award is
granted to the date it is paid in full.
(2) in the context of an attempt by either party to
enforce an arbitral award or order, any defenses
relating to the parties' capacity or the validity of
this Agreement or
the Transaction Documents under any law are hereby waived; and
(3) judgement on any award or order resulting from an
arbitration conducted under this Section may be
entered and enforced in any court, in any country,
having jurisdiction thereof or having jurisdiction
over any of the parties or any of their assets.
(iv) Except as expressly permitted by this
Agreement, no party will commence or voluntarily participate
in any court action or proceeding concerning a Dispute,
except (A) for enforcement as contemplated by paragraph
(iii)(3) above, (B) to restrict or vacate an arbitral
decision based on the grounds specified under applicable law
and not waived in paragraph (iii)(2) above, or (C) for
interim relief as provided in paragraph (v) below. For
purposes of the foregoing or enforcement of any undisputed
obligation, the parties hereto submit to the non-exclusive
jurisdiction of the courts of the State of New York.
(v) In addition to the authority otherwise conferred
on the arbitral tribunal, the tribunal shall have the
authority to make such orders for interim relief, including
injunctive relief, as it may deem just and equitable. If
the tribunal shall not have been appointed, either party may
seek interim relief from a court having jurisdiction if the
award to which the applicant may be entitled may be rendered
ineffectual without such interim relief. Upon appointment
of the tribunal following any grant of interim relief by a
court, the tribunal may affirm or disaffirm such relief, and
the parties will seek modification or rescission of the
court action as necessary to accord with the tribunal's
decision.
(vi) The prevailing party in any arbitration
conducted under this Section shall be entitled to recover
from the other party (as part of the arbitral award or
order) its reasonable attorneys' fees and other costs of
arbitration.
Section 8.13 Affiliate. Nothing contained in the
---------
Transaction Documents shall constitute the Purchaser an
"affiliate" of any of the Company and its Subsidiaries within the
meaning of the Securities Act or the Exchange Act.
Section 8.14 Non-Recourse. No recourse under any of
------------
the Transaction Documents shall be had against any "controlling
person" (within the meaning of Section 20 of the Exchange Act) of
any party or the stockholders, directors, officers, employees,
agents and Affiliates of the party or such controlling persons,
whether by the enforcement of any assessment or by any legal or
equitable proceeding, or by virtue of any Regulation, it being
expressly agreed and acknowledged that no personal liability
whatsoever shall attach to, be imposed on or otherwise be
incurred by such controlling person, stockholder, director,
officer, employee, agent or Affiliate, as such, for any
obligations of the party under this Agreement or any other
Transaction Document or for any claim based on, in respect of or
by reason of such obligations or their creation.
-----------------------
[Intentionally Left Blank]
IN WITNESS WHEREOF, the parties have executed and
delivered this Purchase Agreement as of the date first written
above in New York, New York.
ADVANCED NMR SYSTEMS, INC.
By: /s/ Xxxx Xxxxxx
-------------------------
Name: Xxxx Xxxxxx
Title: Chairman and CEO
Address: Advanced NMR Systems, Inc.
00 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxxxxxxx
00000
Telecopy: (000) 000-0000
GENERAL ELECTRIC COMPANY
By: /s/ Xxxxxxx X. Xxxxxx
-------------------------
Name: Xxxxxxx X. Xxxxxx
Title: President of GE Medical
Systems
Address: General Electric Company
Medical Services Division
0000 Xxxxx Xxxxxxxxx Xxxx.
(P.O. Box 414)
Xxxxxxxx, Xxxxxxxxx 00000
Telecopy: (000) 000-0000
DEFINITION ANNEX
"ACTION" against a person means an action, suit,
investigation, complaint or other proceeding pending against or
affecting the person or its property, whether civil or criminal,
in law or equity or before any arbitrator or Governmental Body.
"AFFILIATE" of a person means any other person (1) that
directly or indirectly controls, is controlled by or is under
common control with, the person or any of its Subsidiaries, (2)
that directly or indirectly beneficially owns or holds 5% or more
of any class of voting stock of the person or any of its
Subsidiaries or (3) 5% or more of the voting stock of which is
directly or indirectly beneficially owned or held by the person
or any of its Subsidiaries. The term "control" means the posses-
sion, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a person, whether
through the ownership of voting securities, by contract or
otherwise.
"APPROVAL" means an authorization, consent, approval or
waiver of, clearance by, notice to or registration or filing
with, or any other similar action by or with respect to a
Governmental Body or any other person and the expiration or
termination of all prescribed waiting, review or appeal periods
with respect to any of the foregoing.
"AMS" means Advanced Mammography Systems, Inc., a
Delaware corporation, and its successors.
"BENEFICIAL OWNERSHIP" has the meaning assigned to that
term in Section 13(d) of the Exchange Act.
"BEST EFFORTS" means the use of all reasonable efforts,
including, without limitation, the expenditure of amounts
reasonably related to the objective sought to be achieved, with
respect to matters and actions over which the person has or could
reasonably be expected to exert any control or influence.
"BUSINESS DAY" means any day excluding Saturday, Sunday
and any day which is a legal holiday under the laws of the State
of New York or is a day on which banking institutions located in
such state are authorized or required by law or other
governmental action to close.
"CERTIFICATE" means the Certificate of Designations
with respect to the Preferred Shares, substantially in the form
of Exhibit A attached hereto, with such changes therein as shall
---------
be approved by the Company and the Purchaser.
"CLOSING" has the meaning stated in Section 2.1 of this
Agreement.
"CLOSING DATE" has the meaning stated in Section 2.1 of
this Agreement.
"COMMON STOCK" has the meaning stated in Section 1.2(a)
of this Agreement.
"COMPANY" means Advanced NMR Systems, Inc., a Delaware
corporation, and its successors.
"CONSOLIDATED" means, as applied to any financial or
accounting term, the term determined on a consolidated basis for
a person and its Consolidated Subsidiaries, excluding
intercompany items and minority interests.
"CONSOLIDATED SUBSIDIARY" of a person at any date means
any Subsidiary of the person or other entity the accounts of
which would be consolidated with those of the person in its
consolidated financial statements as of that date.
"EQUITY SECURITIES" of a person means the capital stock
of the person and all other securities convertible into or
exchangeable or exercisable for any shares of its capital stock,
all rights to subscribe for or to purchase, all options for the
purchase of, and all calls, commitments or claims of any
character relating to, any shares of its capital stock and any
securities convertible into or exchangeable or exercisable for
any of the foregoing.
"EXCHANGE ACT" means the Securities Exchange Act of
1934, as amended, and the related rules and regulations
thereunder.
"FIRST ANNIVERSARY" has the meaning stated in Section
1.2(a)(2) of this Agreement.
"GOVERNMENTAL BODY" means any agency, bureau,
commission, court, department, official, political subdivision,
tribunal or other instrumentality of any government, whether
federal, state, county or local, domestic or foreign.
"KNOWLEDGE OF THE COMPANY" with respect to a
representation or warranty of the Company contained in any
Transaction Document means, after due inquiry by the Company of
each of the following persons, the actual knowledge of any of the
officers or other employees of the Company having managerial
responsibility for the portion of the operations, assets or
liabilities of the Company and its Consolidated Subsidiaries with
respect to which such knowledge of the Company is being
represented.
"LICENSE" has the meaning stated in Section 1.1(b) of
this Agreement.
"LIEN" means any mortgage, deed of trust, lien
(statutory or otherwise), pledge, hypothecation, charge, deposit
arrangement, preference, priority, security interest or
encumbrance of any kind.
"LOSS" means any cost, damage, disbursement, expense,
liability, judgment, loss, deficiency, obligation, penalty or
settlement of any kind or nature, whether foreseeable or
unforeseeable, including, but not limited to, interest or other
carrying costs, penalties, legal, accounting, expert witness,
consultant and other professional fees and expenses incurred in
the investigation, collection, prosecution and defense of claims
and amounts paid in settlement, that may be imposed on or
otherwise incurred or suffered by the specified person.
"MARKET PRICE" means, as of any date of determination,
the average of the daily closing prices per share of the Common
Stock for 20 consecutive trading days commencing 25 trading days
before such date of determination. The closing price for each
such trading day shall be the last reported sales price regular
way or, in case no such sale takes place on such day, the average
of the closing bid and asked prices regular way, in either case
on the principal national securities exchange on which the Common
Stock is listed or admitted to trading, or, if not listed or
admitted to trading on any national securities exchange, on
NASDAQ National Market System or, if the Common Stock is not
listed or admitted to trading on any national securities exchange
or quoted on NASDAQ National Market System, on NASDAQ SmallCap
Market or, if the Common Stock is not quoted on NASDAQ SmallCap
Market, the average of the closing bid and asked prices as
furnished by any New York Stock Exchange member firm selected
from time to time by the Board of Directors of the Company for
such purpose or if no such prices are available, the fair market
value of the Common Stock as determined by good faith action of
the Board of Directors of the Company.
"MATERIAL ADVERSE EFFECT" means a material adverse
effect on (1) the business, properties, operations, prospects,
condition (financial or otherwise) or capitalization of the
Company and its Consolidated Subsidiaries, taken as a whole,
other than a circumstance or event affecting the healthcare
industry generally, or (2) the ability of the Company to perform
its material obligations under any Transaction Document to which
it is or may become a party.
"MERGER" has the meaning stated in Section 6.1(b) of
this Agreement.
"MERGER AGREEMENT" has the meaning stated in Section
6.1(b) of this Agreement.
"PERSON" means an individual, a corporation, a
partnership, an association, a trust or any other entity or
organization, including a Governmental Body.
"PREFERRED CONVERSION SHARES" has the meaning stated in
Section 1.2(a) of this Agreement.
"PREFERRED SHARE PRICE" has the meaning stated in
Section 1.2(a) of this Agreement.
"PREFERRED SHARES" has the meaning stated in Section
1.2(a) of this Agreement.
"PURCHASED ASSETS" has the meaning stated in Section
1.1 of this Agreement.
"PURCHASER" means General Electric Company, a New York
corporation, and its successors.
"REGISTRATION RIGHTS AGREEMENT" means the Registration
Rights Agreement to be entered into by the Company and the
Purchaser, substantially in the form of Exhibit B attached hereto,
---------
with such changes therein as shall be approved by the Company and
the Purchaser.
"REGULATION" means (1) any applicable law, rule,
regulation, judgment, decree, ruling, order, award, injunction,
recommendation or other official action of any Governmental Body
and (2) any official change in the interpretation or
administration of any of the foregoing by the Governmental Body
or by any other Governmental Body or other person responsible for
the interpretation or administration of any of the foregoing.
"SEC DOCUMENTS" has the meaning stated in Section 4.11
of this Agreement.
"SECOND ANNIVERSARY" has the meaning stated in Section
1.2(a)(3) of this Agreement.
"SECURITIES ACT" means the Securities Act of 1933, as
amended, and the related rules and regulations thereunder.
"SETTLEMENT AND RELEASE AGREEMENT" means the Settlement
and Release Agreement to be entered into by the Company and the
Purchaser, substantially in the form of Exhibit D attached hereto,
---------
with such changes therein as shall be approved by the Company and
the Purchaser.
"STOCKHOLDERS AGREEMENT" means the Stockholders
Agreement to be entered into by the Company and the Purchaser,
substantially in the form of Exhibit C attached hereto, with such
---------
changes therein as shall be approved by the Company and the
Purchaser.
"SUBSIDIARY" of a person means (1) any corporation or
other entity of which securities or other ownership interests
having ordinary voting power to elect a majority of the board of
directors or other persons performing similar functions are at
the time directly or indirectly owned by the person or (2) a
partnership in which the person or a Subsidiary of the person is,
at the date of determination, a general or limited partner of
such partnership, but only if the person or its Subsidiary is
entitled to receive more than fifty percent of the assets of such
partnership upon its dissolution. Unless the context otherwise
requires, references to one or more Subsidiaries shall be
references to Subsidiaries of the Company.
"TENTH ANNIVERSARY" has the meaning stated in Section
1.2(a)(2) of this Agreement.
"TRANSACTION DOCUMENTS" means this Agreement, the
Registration Rights Agreement, the Stockholders Agreement, the
Settlement and Release Agreement and all other instruments and
documents executed and delivered by any person in connection with
the conclusion of one or more of the transactions contemplated
hereby and thereby.
"TRANSACTIONS" means, collectively, the transactions
undertaken pursuant to, or otherwise contemplated by, the
Transaction Documents.
"TRANSFER" means a sale, an assignment, a lease, a
license, a grant, a transfer or other disposition of an asset or
any interest of any nature in an asset. The term "transfer" used
as a verb has a correlative meaning.
"WARRANTS" has the meaning stated in Section 4.8(b) of
this Agreement.
"WHOLE-BODY 3T MR SCANNER" has the meaning stated in
Section 6.4 of this Agreement.
"WHOLLY-OWNED SUBSIDIARY" means any Subsidiary, all of
the shares of capital stock or other ownership interests of
which, except directors qualifying shares, are at the time
directly or indirectly owned by the person.
"WHOLLY-OWNED CONSOLIDATED SUBSIDIARY" of a person
means any Consolidated Subsidiary all of the shares of capital
stock or other ownership interests of which, except directors'
qualifying shares, are at the time directly or indirectly owned
by the person.
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