1
EXHIBIT 10.15
ASSET PURCHASE AND STOCK REDEMPTION AGREEMENT
among
ARROW INTERVENTIONAL, INC.
HORIZON MEDICAL PRODUCTS, INC.
and as joining party
STRATO/INFUSAID, INC.
July 15, 1997
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TABLE OF CONTENTS
Page
1. Purchase and Sale of Assets; Assumed Liabilities.................... 2
1.1 Purchase and Sale of Assets............................ 2
1.2 Excluded Assets........................................ 2
1.3 Assumed Liabilities.................................... 2
1.4 Liabilities Not Assumed................................ 3
1.5 Deferred Assigned Contracts. 4
2. Transfer of Arrow Shares as Purchase Consideration.................. 5
3. Closing............................................................. 5
3.1 Date and Place of Closing.............................. 5
3.2 Deliveries by the Company.............................. 5
3.3 Deliveries by Arrow.................................... 6
4. Representations and Warranties of Horizon........................... 7
4.1 organization and Good Standing......................... 7
4.2 Due Authorization; Enforceability; No Conflict......... 8
4.3 Litigation............................................. 10
4.4 Title.................................................. 10
4.5 Purchased Assets....................................... 10
4.6 Brokers................................................ 10
5. Arrow's Representations and Warranties.............................. 11
5.1 organization and Good Standing......................... 11
5.2 Due Authorization; Enforceability; No Conflict......... 11
5.3 Litigation............................................. 12
5.4 Brokers................................................ 12
5.5 Title to Arrow Shares.................................. 12
5.6 No other Representations............................... 12
6. General Covenants of Horizon and Arrow.............................. 13
7. Conditions Precedent to Arrow's obligations......................... 13
7.1 Stock Acquisition...................................... 13
7.2 Consents............................................... 13
7.3 Representations, Warranties & Covenants................ 13
7.4 Litigation Affecting Closing........................... 13
7.5 Closing Deliveries..................................... 14
8. Conditions Precedent to Horizon's obligations....................... 14
8.1 Representations, Warranties & Covenants................ 14
8.2 Stock Acquisition...................................... 14
8.3 Litigation Affecting Closing........................... 14
8.4 Closing Deliveries..................................... 14
8.5 Consents............................................... 15
9. Additional Covenants................................................ 15
9.1 Closing Balance Sheet and Tax Allocation............... 15
9.2 Collections............................................ 17
9.3 Arrow's Use of "Infusaid; Silicone Adhesives".......... 17
9.4 Company's Temporary Use of Norwood, MA Plant;
Special Indemnity...................................... 17
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Page
9.5 Indemnification of Pfizer under Stock Purchase
Agreement.............................................. 19
9.6 Indemnification of Arrow and Horizon under Stock
Purchase Agreement..................................... 21
9.7 Performance of obligations Under Stock Purchase
Agreement.............................................. 22
9.8 Phone Switch........................................... 22
10. Survival and Indemnification........................................ 23
10.1 Survival............................................... 23
10.2 Indemnification of Arrow............................... 23
10.3 Indemnification of Horizon and the Company............. 24
10.4 Notice of Claims....................................... 24
10.5 Defense of Third Party Claims.......................... 24
10.6 Certain Limitations.................................... 25
10.7 Bulk Sales Indemnity................................... 25
10.8 Exclusive Remedies..................................... 25
11. Miscellaneous....................................................... 25
11.1 Termination of Agreement; Liabilities.................. 25
11.2 Further Assurances..................................... 26
11.3 Benefit of Agreement................................... 26
11.4 Expenses............................................... 26
11.5 Covenants Not to Compete; Use of "Infusaid" on Pumps... 26
11.6 Confidentiality........................................ 27
11.7 Entire Agreement; Amendments........................... 28
11.8 Stock Purchase Agreement............................... 28
11.9 Counterparts........................................... 28
11.10 Section and Paragraph Headings......................... 28
11.11 Notices................................................ 28
11.12 Governing Law.......................................... 30
11.13 Submission to Jurisdiction; Consent to Service of
Process................................................ 30
11.14 Interpretation......................................... 30
1.1 Purchased Assets Schedule.............................. 34
1.2 Certain Excluded Assets................................ 43
1.3 Arrow Employees........................................ 45
1.4 Horizon Employees...................................... 46
4.2 Conflict and Consent Schedule.......................... 47
4.4 Title Exceptions....................................... 48
5.2 Conflict Schedule...................................... 49
11.5(b) List of Distributors of Port Products.................. 50
3.2(a) Xxxx of Sale and General Assignment.................... 51
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Page
3.2(b) Assignment and Assumption of Lease Agreement........... 52
3.2(c) opinion of Xxxxxxxxx & Virgin.......................... 53
3.3(a) Assumption Agreement................................... 54
3.3(c) opinion of Nixon, Hargrave, Devans & Xxxxx LLP......... 55
7.3(a) Certificate of Horizon................................. 56
7.3(b) Certificate of the Company............................. 57
8.1 Certificate of Arrow................................... 58
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ASSET PURCHASE AND STOCK REDEMPTION AGREEMENT
THIS ASSET PURCHASE AND STOCK REDEMPTION AGREEMENT
(hereinafter referred to as the "Agreement") is made as of July 15, 1997 by and
among ARROW INTERVENTIONAL, INC., a Delaware corporation ("Arrow"), HORIZON
MEDICAL PRODUCTS, INC., a Georgia corporation ("Horizon") and, by joining as an
additional party hereto immediately following consummation of the transactions
hereunder, STRATO/INFUSAID, INC., a Massachusetts corporation (the "Company").
W I T N E S S E T H:
WHEREAS, the Company is a wholly owned subsidiary of Pfizer
Inc., a Delaware corporation ("Pfizer"), and is in the business, among other
things, of manufacturing and distributing vascular access products (the "Port
Business") and implantable infusion pump products (the "Pump Business");
WHEREAS, Arrow wishes to acquire the Pump Business, and
Horizon wishes to acquire the Port Business;
WHEREAS, Arrow, Horizon, Pfizer and the Company have entered
into a certain Purchase Agreement dated as of June 20, 1997 (such Purchase
Agreement, as amended from time to time, the "Stock Purchase Agreement"; terms
used herein and otherwise not herein defined shall have the respective meanings
assigned to such terms in the Stock Purchase Agreement);
WHEREAS, pursuant to the Stock Purchase Agreement (i) Arrow
has agreed to acquire from Pfizer and/or any affiliate of Pfizer 24,706 shares
(the "Arrow Shares") of the capital stock of the Company (the "Common Stock")
and certain of those "Foreign Assets" described in Schedule 2.1(a) to the Stock
Purchase Agreement under the caption "Pump Related Foreign Assets", and (ii)
Horizon has agreed to acquire from Pfizer and/or any affiliate of Pfizer 275,294
shares (the "Horizon Shares") of the Common Stock and certain of those "Foreign
Assets" described in Schedule 2.1(a) to the Stock Purchase Agreement under the
caption "Port Related Foreign Assets"; and
WHEREAS, on the Closing Date and immediately following
consummation of the transactions contemplated by the Stock Purchase Agreement
(the "Stock Acquisition"), Arrow wishes to acquire from the Company, and
Horizon, as the beneficial owner of a majority of the Common Stock, wishes to
cause the Company to transfer, sell and assign to Arrow, the Pump Business in
exchange for the Arrow Shares, all upon and subject to the terms and conditions
of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements herein contained and for other good and valuable consideration, the
receipt, adequacy and sufficiency of
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which are hereby acknowledged, Horizon, Arrow and, when made additional party
hereto, the Company, agree as follows:
1. Purchase and Sale of Assets; Assumed Liabilities
1.1 Purchase and Sale of Assets. On the Closing Date and
immediately following consummation of the Stock Acquisition, upon and subject to
the terms and conditions of this Agreement, Horizon shall cause the Company to
sell, transfer, assign, convey and deliver to Arrow, and Arrow shall purchase
and acquire from the Company, the "Purchased Assets" described on Schedule 1.1
hereto (the "Purchased Assets"). Notwithstanding any provision of this Agreement
to the contrary, to the extent any assets of the Company do not relate
principally to the Port Business or the Pump Business (e.g., office furniture
and equipment and computers) (other than (except as provided in Section 1.2(v)
below) leasehold improvements and fixtures relating to the Facility (which
Facility shall also be referred to in this Agreement as the "Plant")), fifty
percent (50%) in value of such assets, as determined by Coopers & Xxxxxxx
pursuant to Section 9.1(a), shall be sold, transferred, assigned, conveyed and
delivered to Arrow and shall constitute Purchased Assets.
1.2 Excluded Assets. Except as provided in Section 1.1, the
Company shall retain and shall not be caused to sell or deliver to Arrow, and
Arrow shall not purchase from the Company the following assets, all of which
shall be excluded from the Purchased Assets: (i) all original books or records
of the Company which pertain to the financial accounting and tax aspects of the
Company for periods preceding the Closing Date (all of which shall be maintained
by the Company and Horizon in accordance with Section 5.2(b) of the Stock
Purchase Agreement); (ii) subject to Section 5.2(d) of the Stock Purchase
Agreement, pension, profit sharing, retirement, bonus and savings plans or
trusts and, except as otherwise provided in the Stock Purchase Agreement, any
assets thereof and all other plans, agreements or understandings to provide
employee benefits of any kind for employees of the Company; (iii) subject to
Section 9.3 below, all rights in and to the name "Strato" or "Infusaid" and any
logo or variation thereof; (iv) those assets of the Company which are not
expressly transferred pursuant to Section 1.1 hereof, including, without
limitation, those listed on Schedule 1.2 hereof; (v) all warehousing and
distribution equipment in the inventory and shipping areas of the Plant and the
Company exhibit booths (other than graphics and display materials which relate
principally to the Pump Business); and (vi) all rights which accrue to or are
retained by the Company under and by virtue of this Agreement (collectively, the
"Excluded Assets").
1.3 Assumed Liabilities. On the Closing Date and immediately
following consummation of the Stock Acquisition, Arrow shall assume from the
Company and, without waiving,
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releasing discharging or terminating in any respect the right to such
indemnification from or other undertaking of, Pfizer under the Stock Purchase
Agreement, pay and perform, without duplication (i) except for liabilities
referred to in the second sentence of Section 1.4, all obligations and
liabilities of the Company outstanding as of the Closing Date that are related
to or arise from the Pump Business, excluding, however, such liabilities and
obligations that are retained by and are the responsibility of Pfizer under the
Stock Purchase Agreement, (ii) all obligations and liabilities of the Company
which arise in connection with the Purchased Assets on and after the Closing
Date (including without limitation any personal injury or property damage
whatsoever caused by or through any of the Purchased Assets and any taxes,
interest and penalties which arise after the Closing Date as a result of Arrow's
ownership or operation of the Pump Business), (iii) all obligations and
liabilities of the Company under the Lease Agreement and all obligations and
liabilities of the Company for the Plant, except (x) for those created after the
Closing by Horizon or the Company, (y) as otherwise provided in Section 9.4
hereof and (z) for the obligations and liabilities that are retained by and are
the responsibility of Pfizer under the Stock Purchase Agreement, (iv) all
obligations and liabilities of the Company to each of the "Arrow Employees"
listed on Schedule 1.3 hereto, excluding, however, such obligations and
liabilities that are retained by and are the responsibility of Pfizer under the
Stock Purchase Agreement, and (v) all obligations under the agreements,
instruments, indentures, commitments and undertakings referred to on Schedule
1.1 hereto as the "Assigned Contracts" provided, however, that to the extent any
such Assigned Contract is only partially assigned to Arrow (as is the case with
each Assigned Contract marked with an asterisk on Schedule 1.1), Arrow shall
assume liabilities and obligations thereunder only to the extent such
liabilities and obligations pertain to rights assigned to Arrow (all of such
liabilities and obligations in above clauses (i), (ii), (iii), (iv), and (v),
but specifically excluding those described in Section 1.4 below, are hereinafter
referred to as the "Assumed Liabilities"). With respect to any of the
above-described obligations and liabilities that would be Assumed Liabilities
except that such liabilities and obligations were retained by and are the
responsibility of Pfizer under the Stock Purchase Agreement; solely to the
extent such obligations and liabilities are retained by and the responsibility
of Pfizer under the Stock Purchase Agreement, neither Horizon nor the Company
will be responsible for or required to pay such obligations and liabilities,
and, solely to such extent, Arrow, if necessary, will pay such obligations and
liabilities and seek indemnification from Pfizer under the Stock Purchase
Agreement for such obligations and liabilities.
1.4 Liabilities Not Assumed. Arrow shall not and will not
accept or assume any liability or obligation of the Company
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other than the Assumed Liabilities which Arrow is expressly agreeing to accept
or assume pursuant to this Agreement. Without limiting the foregoing, the
Company shall not assign or transfer to Arrow, and Arrow shall not and will not
accept or assume any liability or obligation of the Company (i) except as
expressly provided in Section 1.3(ii), arising from or related to any federal,
state or local income, sales, use, excise or other tax of the Company (including
without limitation any such taxes incurred by the Company as a result of the
transactions contemplated hereby); (ii) except for the Arrow Employees, relating
to any other employees, former employees or retirees of the Company (including
without limitation those listed on Schedule 1.4 hereto) or arising by reason of
any such other person's employment or termination of employment by the Company,
including, without limitation, those relating to the Company's terms or
conditions of employment, policies, practices, compensation, wages, payroll
expenses, accrued vacation and sick leave, medical benefits, benefit or welfare
plans, pension plans, compliance with applicable federal, state or local labor
and/or employment laws, rules, regulation or orders, or any other
employment-related obligation; (iii) arising from or otherwise associated with
or relating to the Port Business (including without limitation any personal
injury or property damage whatsoever caused by or through any products of the
Port Business); (iv) arising from or related to any the Company's lack of
compliance with any applicable federal, state or local laws, rules, regulations,
ordinances or orders, except to the extent such lack of compliance is related to
or arises from the Plant, the Pump Business or the Arrow Employees; (v) any
liabilities or obligations relating to Excluded Assets; or (vi) any liabilities
or obligations not expressly assumed by Arrow hereunder.
1.5 Deferred Assigned Contracts. If, on the Closing Date, (i)
Horizon or the Company has not obtained any Consent required to permit or enable
the Company to transfer or assign (a "Transfer) all of the Company's right,
title or interest in and obligations under any assigned agreement, instrument or
indenture constituting a portion of the Purchased Assets (each, an "Assigned
Contract") referred to on Schedule 1.1 hereto or if an attempted assignment,
transfer or conveyance of any Assigned Contract included in the Purchased Assets
would be ineffective or would adversely affect the Company's ability to convey
the same and (ii) the conditions precedent to the Closing set forth herein have
nevertheless been satisfied, then such Assigned Contract shall constitute a
"Deferred Assigned Contract" and shall not be transferred to Arrow on the
Closing Date, but thereafter (A) Horizon and the Company will continue to use
all reasonable efforts, and Arrow will cooperate with Horizon and the Company,
to obtain the Consent and/or to remove any other impediments to the Transfer of
each such Deferred Assigned Contract, (B) until the Transfer of any such
Deferred Assigned Contract, Horizon and the Company ensure that Arrow shall
receive the benefits under
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such Deferred Assigned Contract after the Closing Date to the same extent as if
it were the Company, with, to the extent provided in clause (D) below, all costs
and expenses thereof, as well as all gains, income, losses, taxes or other items
generated thereby to be for Arrow's account, (C) the Company will transfer or
assign each such Deferred Assigned Contract to Arrow within five (5) business
days after the receipt of such Consent and/or the removal of such impediment,
and (D) Arrow shall assume the Company's obligations and liabilities thereunder
and such liabilities and obligations will be deemed to constitute Assumed
Liabilities, and, Arrow shall perform such obligations of the Company arising
under such Deferred Assigned Contract. In addition, with respect to each
"Retained Contract" described on Schedule 1.1 hereto, Horizon and, when joined
as party hereto, the Company agree that, until expiration or termination
thereof, the Company will cooperate with Arrow in any lawful arrangement to
provide that Arrow shall receive such portion of the benefits of the interest
thereunder after the Closing Date as the parties shall mutually agree to the
same extent as if it were the Company, with all costs and expenses thereof, as
well as all gains, income, losses, taxes or other items generated thereby to be
for the account of the respective parties as shall be mutually agreed.
2. Transfer of Arrow Shares as Purchase Consideration. In
consideration for the Company's sale, transfer and delivery of the Purchased
Assets to Arrow, Arrow will tender and deliver to the Company all of the stock
certificates representing the Arrow Shares, duly endorsed in blank or
accompanied by duly executed instruments of transfer, and Horizon agrees to
cause the Company to accept, and upon its execution hereof the Company agrees to
accept, the Arrow Shares, together with Arrow's assumption of the Assumed
Liabilities, as payment in full for the Purchased Assets.
3. Closing
3.1 Date and Place of Closing. The purchase and sale of the
Purchased Assets and assumption of the Assumed Liabilities contemplated by this
Agreement (the "Closing") will occur, and will be effective, immediately
following consummation of the Stock Acquisition at the time and location and on
the Closing Date referred to in the Stock Purchase Agreement, or at such other
time and place as may be agreed upon by Arrow and Horizon.
3.2 Deliveries by the Company. At the Closing, Horizon shall
deliver, and/or shall cause the Company to deliver, to Arrow the following:
(a) A Xxxx of Sale and General Assignment from the Company in
the form of Exhibit 3.2(a) hereto conveying good and
marketable title to the
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Purchased Assets free and clear of all Encumbrances
(except as otherwise provided in Section 4.4 hereof).
(b) An Assignment and Assumption of Lease Agreement
between the Company and Arrow in the form of Exhibit
3.2(b) hereto (the "Lease Assignment").
(c) A legal opinion of Xxxxxxxxx & Virgin, special
counsel to the Company, in the form of Exhibit
3.2(c) hereto.
(d) Two counterparts of this Agreement, fully executed
and delivered by the Company as joining party
hereto.
(e) A certificate of Horizon as required by Section
7.3(a) hereof.
(f) A certificate of the Company as required by
Section 7.3(b) hereof.
(g) A certified copy of the corporate charters and
by-laws of each of the Company and Horizon, and the
resolutions of the Board of Directors and majority
shareholders of the Company authorizing the
transactions contemplated by this Agreement.
(h) Certificates and reports from the appropriate public
officials evidencing the Company's and Horizon's good
standing in the respective jurisdictions of their
organization and any other jurisdiction in which
either the Company or Horizon is qualified to conduct
business.
(i) Subject to Section 9.4 hereof, actual possession and
operating control of the Purchased Assets (including
without limitation actual possession of the Company's
premises in Norwood, Massachusetts).
(j) Such other instruments, assignments, assumptions,
special or limited warranty deeds, terminations,
releases and other instruments of transfer,
assignment and release of the Company and Horizon
as shall be reasonably deemed necessary by Arrow
to vest in Arrow good and marketable title to the
Purchased Assets, free and clear of any and all
Encumbrances (except as provided in Section 4.4
hereof).
3.3 Deliveries by Arrow. At the Closing, Arrow shall
deliver or cause to be delivered (i) to the Company all stock
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certificates evidencing the Arrow Shares in accordance with Section 2 hereof,
free and clear of all Encumbrances, and (ii) to Horizon and/or the Company the
following:
(a) An Assumption Agreement in the form of Exhibit 3.3(a)
hereto, pursuant to which Arrow will assume the
Assumed Liabilities as set forth in Section 1.3
hereof.
(b) A counterpart of the Lease Assignment.
(c) A legal opinion of Nixon, Hargrave, Devans & Xxxxx
LLP, special New York counsel to Arrow, in the form
of Exhibit 3.3(c) hereto.
(d) A certificate of Arrow as required by Section 8.1
hereof.
(e) A certified copy of the corporate charter and by-laws
of Arrow, and the resolutions of the Board of
Directors of Arrow authorizing the transactions
contemplated by this Agreement.
(f) Certificates and reports from the appropriate public
officials evidencing Arrow's good standing in its
jurisdiction of organization and in the Commonwealth
of Massachusetts.
(g) A resale certificate pursuant to which Arrow shall
certify that any inventory included in the Purchased
Assets will be acquired by Arrow for resale.
(h) Such other instruments, assignments, assumptions,
special or limited warranty deeds, terminations,
releases and other instruments of transfer of Arrow
as Horizon shall deem reasonably necessary to vest in
Horizon title to the Arrow Shares, free and clear of
all Encumbrances.
4. Representations and Warranties of Horizon. Horizon
and, when joined as party hereto, the Company hereby represent and warrant to
Arrow, jointly and severally, as follows:
4.1 Organization and Good Standing. (a) Horizon is a
corporation duly organized, validly existing and in good standing under the laws
of Georgia, and has the requisite corporate power and authority to execute and
deliver this Agreement and the documents, agreements and certificates
(collectively, the "Horizon Transfer Documents") which are required to be
executed and delivered by Horizon pursuant to this Agreement and to
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perform in all respects its obligations hereunder and thereunder. Horizon is
duly qualified or licensed to do business and in good standing in each
jurisdiction in which the nature of its business or the character of the assets
owned or leased by Horizon makes such qualification or licensing necessary,
except where the failure to be so qualified or licensed would not impair or
otherwise adversely affect the transactions contemplated hereunder.
(b) On the Closing Date and (with respect to the making of
this representation and warranty by Horizon, to Horizon's knowledge) the Company
shall be (i) a corporation duly incorporated, validly existing and in good
standing under the laws of Massachusetts, and shall have the requisite corporate
power and authority to execute and deliver the documents, agreements and
certificates (collectively, the "Company Transfer Documents") which are required
to be executed and delivered by the Company pursuant to this Agreement and to
perform in all respects its obligations thereunder, and (ii) duly qualified or
licensed to do business and in good standing in each jurisdiction in which the
nature of its business or the character of the assets owned or leased by the
Company makes such qualification or licensing necessary, except where the
failure to be so qualified or licensed would not impair or otherwise adversely
affect the transactions contemplated hereunder. The representations and
warranties made by Horizon (but not the representations and warranties made by
the Company) in this Section 4.1(b) is based solely upon the representations and
warranties from Pfizer and the Company to Horizon and Arrow in Section 4.1(b) of
the Stock Purchase Agreement, and for any breach of such representations and
warranties made by Horizon, Arrow's sole remedy shall be against Pfizer under
the Stock Purchase Agreement.
4.2 Due Authorization; Enforceability; No Conflict. (a) The
execution, delivery and performance of this Agreement and the Horizon Transfer
Documents have been duly authorized by all requisite corporate action on the
part of Horizon. This Agreement has been duly executed and delivered by Horizon
and constitutes, and each of the Horizon Transfer Documents when executed and
delivered will constitute, the valid and binding obligation of Horizon,
enforceable in accordance with and subject to their respective terms, except as
limited by bankruptcy, insolvency, reorganization and similar laws affecting the
enforcement of creditors' rights or contractual obligations generally. Except as
set forth on Schedule 4.2 attached hereto or any other Schedule to this
Agreement, the execution, delivery and performance by Horizon of this Agreement
and the Horizon Transfer Documents and the consummation of the transactions
contemplated hereby and thereby will not: (i) violate any provision of the
Certificate of Incorporation or By-laws of Horizon; (ii) result in the creation
of any Encumbrances upon any of the Purchased Assets; (iii) violate any
provision of any
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judicial or administrative order, award, judgment or decree applicable to any
Horizon; (iv) conflict with, result in a material breach of or constitute a
default under any agreement or instrument to which Horizon is a party or by
which it is bound; (v) violate, in any material respect, any applicable law,
rule, ordinance or regulation applicable to any Horizon; or (vi) except for the
consents and approvals listed on Schedule 4.2 hereto (collectively, the
"Consents"), require Horizon to obtain the consent, approval or authorization
of, or require Horizon to file any certificate, notice, application, report or
other document with, any federal, state or local governmental authority or
agency or other person or entity.
(b) On the Closing Date, the execution, delivery and
performance of the Company Transfer Documents shall have been duly authorized by
all requisite corporate action on the part of the Company, and each of the
Company Transfer Documents will have been duly executed and delivered by the
Company and will constitute the valid and binding obligation of the Company,
enforceable in accordance with and subject to their respective terms, except as
limited by bankruptcy, insolvency, reorganization and similar laws affecting the
enforcement of creditors' rights or contractual obligations generally. Except as
set forth on Schedule 4.2 attached hereto (as updated as of the Closing Date),
on the Closing Date the execution, delivery and performance by the Company of
the Company Transfer Documents and the consummation of the transactions
contemplated thereby will not (and with respect to the making of this
representation and warranty by Horizon, to Horizon's knowledge): (i) violate any
provision of the Certificate of Incorporation or By-laws of any the Company;
(ii) except with respect to any Deferred Assigned Contract during any period
prior to the time at which any required third party consent to assignment
thereof shall have obtained, result in the creation of any Encumbrances upon any
of the Purchased Assets; (iii) violate any provision of any judicial, arbitral
or administrative order, award, judgment or decree applicable to the Company;
(iv) violate, in any material respect, any applicable law, rule, ordinance or
regulation applicable to any the Company; or (vi) except for the Consents on
Schedule 4.2 hereto (as updated as of the Closing Date), require the Company to
obtain the consent, approval or authorization of, or require any the Company to
file any certificate, notice, application, report or other document with, any
federal, state or local governmental authority or agency or other person or
entity. To the extent, if any, the representations and warranties made by
Horizon and the Company in the preceding sentence are the same in all material
respects to the representations and warranties from Pfizer and the Company to
Horizon and Arrow in Section 4.1(a) of the Stock Purchase Agreement, Arrow's
remedy for a breach of such representations and warranties shall be against
Pfizer under the Stock Purchase Agreement.
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4.3 Litigation. There are no judicial or administrative
actions, suits or proceedings or, to the knowledge of Horizon, any
investigations pending against Horizon or (with respect to the making of this
representation and warranty by Horizon, to the knowledge of Horizon) the Company
which would, if adversely determined, prevent, hinder, delay or otherwise
adversely affect the consummation of the transactions contemplated hereby.
Neither Horizon nor (with respect to the making of this representation and
warranty by Horizon, to the knowledge of Horizon), on the Closing Date the
Company is a party to or subject to the provisions of any order, decree or
judgment of any court or of any governmental authority agency which may prevent,
hinder or otherwise adversely affect the consummation of the transactions
contemplated hereby. To the extent, if any, the representations and warranties
in this Section 4.3 with respect to matters relating to the Company are the same
in all material respects to the representations and warranties from Pfizer and
the Company to Horizon and Arrow in Section 4.1(j) of the Stock Purchase
Agreement, Arrow's remedy for a breach of such representations and warranties
shall be against Pfizer under the Stock Purchase Agreement.
4.4 Title. On the Closing Date, the Company will have, and
upon completion of the Closing will have conveyed to Arrow good and marketable
title to the Purchased Assets owned by the Company, free and clear of all
Encumbrances, except as set forth on Schedule 4.4 hereto. This representation
and warranty made by Horizon (but not the representation and warranty made by
the Company) is only as to Horizon's knowledge and shall apply only to the
Company's conveyance of good and marketable title to the Purchased Assets, free
and clear of all Encumbrances, as of the Closing. If the Company does not convey
such good and marketable title to the Purchased Assets, free and clear of all
Encumbrances, as a result of some defect in title occurring prior to the closing
under the Stock Purchase Agreement or some Encumbrance in existence prior to the
closing under the Stock Purchase Agreement, Arrow's sole remedy for such defect
or Encumbrance shall be against Pfizer under the Stock Purchase Agreement.
4.5 Purchased Assets. EXCEPT AS PROVIDED IN THIS AGREEMENT,
NEITHER HORIZON NOR, ON THE CLOSING DATE, THE COMPANY MAKES ANY REPRESENTATION
OR WARRANTY (AND EXPRESSLY DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR FITNESS
FOR A PARTICULAR PURPOSE), EXPRESS OR IMPLIED, WITH RESPECT TO THE CONDITION OF
THE PURCHASED ASSETS, ALL OF WHICH ARE BEING SOLD TO, AND PURCHASED BY ARROW,
"AS IS".
4.6 Brokers. Neither Horizon nor any affiliate thereof has
retained, employed or dealt with any third-party broker, finder or investment
banker in connection with this Agreement or the transactions contemplated hereby
and no broker
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or other third party is entitled to any commission or finder's fee as a result
of any agreement or action taken by Horizon or the Company or its affiliates in
connection with such transactions.
5. Arrow's Representations and Warranties. Arrow hereby
represents and warrants to Horizon and, when joined as a party hereto, the
Company as follows:
5.1 Organization and Good Standing. Arrow is a corporation
duly organized, validly existing and in good standing under the laws of
Delaware, and has the requisite corporate power and authority to execute and
deliver this Agreement and the documents, agreements and certificates
(collectively, the "Arrow Transfer Documents") which are required to be executed
and delivered by Arrow pursuant to this Agreement and to perform in all respects
its obligations hereunder and thereunder. Arrow is duly qualified or licensed to
do business and in good standing in each jurisdiction in which the nature of its
business or the character of the assets owned or leased by Arrow makes such
qualification or licensing necessary, except where the failure to be so
qualified or licensed would not impair or otherwise adversely affect the
transactions contemplated hereunder.
5.2 Due Authorization; Enforceability; No Conflict. The
execution, delivery and performance of this Agreement and the Arrow Transfer
Documents have been duly authorized by all requisite corporate action on the
part of Arrow. This Agreement has been duly executed and delivered by Arrow and
constitutes, and each of the Arrow Transfer Documents when executed and
delivered will constitute, the valid and binding obligation of Arrow,
enforceable in accordance with and subject to their respective terms, except as
limited by bankruptcy, insolvency, reorganization and similar laws affecting the
enforcement of creditors' rights or contractual obligations generally. Except as
set forth on Schedule 5.2 attached hereto or on any other Schedule to this
Agreement, the execution, delivery and performance by Arrow of this Agreement
and the Arrow Transfer Documents and the consummation of the transactions
contemplated hereby and thereby will not: (i) violate any provision of the
Certificate of Incorporation or By-laws of Arrow; (ii) result in the creation by
Arrow of any Encumbrances upon any of the Arrow Shares; (iii) violate any
provision of any judicial, arbitral or administrative order, award, judgment or
decree applicable to Arrow; (iv) conflict with, result in a material breach of
or constitute a default under any agreement or instrument to which Arrow is a
party or by which it is bound; (v) violate, in any material respect, any
applicable law, rule, ordinance or regulation applicable to Arrow; or (vi)
except for obtaining the Consents, require Arrow to obtain the consent, approval
or authorization of, or require Arrow to file any certificate, notice,
application, report or other document with, any federal,
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state or local governmental authority or agency or other person or entity.
5.3 Litigation. There are no judicial, arbitral or
administrative actions, suits or proceedings or, to the knowledge of Arrow, any
investigations pending against Arrow which would, if adversely determined,
prevent, hinder, delay or otherwise adversely affect the consummation of the
transactions contemplated hereby. Arrow is not a party to or subject to the
provisions of any order, decree or judgment of any court or of any governmental
agency which may prevent, hinder or otherwise adversely affect the consummation
of the transactions contemplated hereby.
5.4 Brokers. Neither Arrow nor any affiliate thereof has
retained, employed or dealt with any third-party broker, finder or investment
banker in connection with this Agreement or the transactions contemplated hereby
and no broker or other third party is entitled to any commission or finder's fee
as a result of any agreement or action taken by Arrow or its affiliates in
connection with such transaction.
5.5 Title to Arrow Shares. Upon (but subject to consummation
of) the Stock Acquisition, to Arrow's knowledge, Arrow will own of record and
beneficially all of the Arrow Shares, free and clear of all Encumbrances (except
for Encumbrances contemplated by Stock Purchase Agreement). The Arrow Shares
will be conveyed by Arrow to the Company free and clear of any Encumbrance
created by Arrow other than Encumbrances in favor of the Company or Horizon
created pursuant to this Agreement and restrictions under applicable securities
laws. With the exception of the immediately preceding sentence, this
representation and warranty made by Arrow is only as to Arrow's knowledge and
shall apply only to Arrow's conveyance of the Arrow Shares, free and clear of
all Encumbrances created by Arrow, as of the Closing. If Arrow does not convey
such good and marketable title to the Arrow Shares, free and clear of all
Encumbrances, as a result of some defect in title occurring prior to the closing
under the Stock Purchase Agreement or some Encumbrance in existence prior to the
closing under the Stock Purchase Agreement, Horizon's and the Company's sole
remedy for such defect or Encumbrance shall be against Pfizer under the Stock
Purchase Agreement. If requested by Horizon, Arrow will assign to Horizon
Arrow's indemnification claim against Pfizer for any defect in title or
Encumbrance to which the immediately preceding sentence is applicable.
5.6 No Other Representations. EXCEPT AS PROVIDED IN THIS
AGREEMENT, ARROW MAKES NO OTHER REPRESENTATIONS OR WARRANTIES TO HORIZON OR,
WHEN JOINED AS A PARTY, THE COMPANY, EXPRESSED OR IMPLIED.
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6. General Covenants of Horizon and Arrow. Horizon and Arrow
agree that from the date of this Agreement until the Closing Date they will use
their reasonable best efforts to take any and all action necessary and advisable
under the Stock Purchase Agreement to consummate the Stock Acquisition as
promptly as possible. In addition, Horizon shall use its reasonable best efforts
to cause the Company to execute and deliver this Agreement on the Closing Date.
7. Conditions Precedent to Arrow's Obligations. The
obligations of Arrow under this Agreement are subject to the fulfillment on or
before the Closing Date of each of the following conditions:
7.1 Stock Acquisition. The Stock Acquisition and all other
transactions contemplated by the Stock Purchase Agreement to be consummated on
the Closing Date shall have been consummated to the effect, among other things,
that Arrow shall have acquired the Arrow Shares from Pfizer.
7.2 Consents. Horizon and the Company shall have delivered
Arrow evidence, in form and substance reasonably satisfactory to Arrow, that
neither Horizon nor the Company has created any Encumbrances on the Purchased
Assets.
7.3 Representations, Warranties & Covenants. (a) The
representations and warranties of Horizon contained in this Agreement shall be
true and correct in all material respects at and as of the date hereof and at
and as of the Closing Date with the same force and effect as though made at and
as of the Closing Date, except for changes therein as may be specifically
contemplated by this Agreement. Horizon shall have duly performed and complied
in all material respects with all agreements and conditions required by this
Agreement to be performed or complied with by it prior to or on the Closing
Date. Horizon shall have delivered to Arrow a certificate dated the Closing Date
to the foregoing effect, in the form attached hereto as Exhibit 7.3(a).
(b) The representations and warranties herein of the Company,
when joined a party hereto, shall be true and correct in all material respects
at and as of the Closing Date, and the Company shall have delivered to Arrow a
certificate dated the Closing Date to the foregoing effect, in the form attached
hereto as Exhibit 7.3(b).
7.4 Litigation Affecting Closing. There shall not be pending
or threatened any action or proceeding for any injunction, writ or preliminary
restraining order or for any order of any court, governmental agency or
arbitrator, domestic or foreign, federal, state, or local, of competent
jurisdiction, or any investigation or examination which might result in such an
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action or proceeding, directing that the sale of the Purchased Assets to Arrow
or any of the other transactions contemplated by this Agreement not be
consummated or otherwise challenging the legality thereof, and there shall not
be in effect on the Closing Date any such injunction, writ or preliminary
restraining order or such other order.
7.5 Closing Deliveries. At the Closing, Horizon and the
Company shall have delivered to Arrow such instruments, documents and
certificates as are required pursuant to Section 3.2 hereof.
8. Conditions Precedent to Horizon's Obligations. The
obligations of Horizon under this Agreement are subject to the fulfillment on or
before the Closing Date of each of the following conditions:
8.1 Representations, Warranties & Covenants. The
representations and warranties of Arrow contained in this Agreement shall be
true and correct in all material respects at and as of the Closing Date with the
same force and effect as though made at and as of the Closing Date, except for
such changes therein as may be specifically contemplated by this Agreement.
Arrow shall have duly performed and complied in all material respects with all
agreements and conditions required by this Agreement to be performed or complied
with by it prior to or on the Closing Date. Arrow shall have delivered to the
Company a certificate dated the Closing Date to the foregoing effect, in the
form attached hereto as Exhibit 8.1.
8.2 Stock Acquisition. The Stock Acquisition and all other
transactions contemplated by the Stock Purchase Agreement to be consummated on
the Closing Date shall have been consummated to the effect, among other things,
that Horizon shall have acquired the Horizon Shares from Pfizer.
8.3 Litigation Affecting Closing. There shall not be pending
or threatened any action or proceeding for any injunction, writ or preliminary
restraining order or for any order of any court, governmental agency or
arbitrator, domestic or foreign, federal, state, or local, of competent
jurisdiction, or any investigation or examination which might result in such an
action or proceeding, directing that the sale of the Purchased Assets to Arrow
or any of the other transactions contemplated by this Agreement not be
consummated or otherwise challenging the legality thereof, and there shall not
be in effect on the Closing Date any such injunction, writ or preliminary
restraining order or such other order.
8.4 Closing Deliveries. At the Closing, Arrow shall have
delivered to Horizon and the Company such instruments,
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documents and certificates as are required pursuant to Section 3.3 hereof.
8.5 Consents. Horizon shall be satisfied that the Consents
listed on Schedule 4.2 hereto shall have been obtained.
9. Additional Covenants
9.1 Closing Balance Sheet and Tax Allocation.
(a) Promptly after the Closing but in any event within 30
calendar days thereafter, subject to the terms of this Agreement and Schedules
to this Agreement (including, without limitation, Section 1 and Section 9.1(b)),
Horizon and the Company shall have caused Coopers & Xxxxxxx to provide Arrow
with a balance sheet for each of the Pump Business and the Port Business as at
the Closing (but after giving effect to the transactions hereunder) and
schedules with such balance sheet that identify and divide accounts receivable,
prepaid expenses, inventories, accounts payable, accruals and other liabilities
between the Port Business and the Pump Business. The fees and expenses of
Coopers & Xxxxxxx in connection with the foregoing shall be shared equally
between Horizon and Arrow, and Horizon will be responsible for the costs of such
accounting firm for matters other than those in this Section 9.1(a).
(b) Notwithstanding any provision of this Agreement to the
contrary, the parties agree that, after the Closing, they shall use their
reasonable commercial efforts to evaluate the Intellectual Property (as defined
below) of the Company as in existence immediately prior to the Closing (other
than the patents and patent applications listed on Schedule 1.1) to determine
whether any portion thereof relates principally to the Pump Business. To the
extent any portion of such Intellectual Property relates principally to the Pump
Business, Horizon and the Company shall cause such Intellectual Property to be
sold, assigned, conveyed, transferred and delivered to Arrow and shall enter
into such agreements, instruments and indentures as shall be reasonably
necessary to cause such sale, assignment, conveyance, transfer and delivery. To
the extent that the existing products and products under development as of the
date hereof of the Port Business or the Pump Business use any rights or property
relating to any Intellectual Property conveyed or to be conveyed to Arrow
pursuant to this Agreement or any Intellectual Property retained or to be
retained by the Company or constituting an Excluded Asset, each of Arrow and the
Company hereby grants a non-exclusive, fully paid up, royalty-free,
non-terminable, worldwide right and license to the other party to use such
Intellectual Property solely in connection with the manufacture, arrangements
with third parties to have manufactured, use, import, or sale of any such
existing product or product under development as of the date hereof; provided,
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however, that (i) such license may only be assigned to an Affiliate of such
party and then only with the prior written consent of the licensor (which will
not be unreasonably withheld, delayed or conditioned) and (ii) with respect to
trademarks, such license shall expire (but otherwise remain in effect with
regard to other types of Intellectual Property) upon the sale of all inventory
(including all raw materials, work in progress and finished goods) existing on
the Closing Date that bears a trademark licensed pursuant to this paragraph.
Each party agrees to maintain and cause its employees, agents and
representatives to maintain, the confidentiality of any confidential information
which is not publicly known and is in the possession of or disclosed to a Person
owing a duty of confidentiality hereunder (an "Obligated Party") constituting a
portion of such Intellectual Property provided, however, that the foregoing
shall not apply to: (i) information that becomes a matter of public knowledge
through no fault of an Obligated Party, is rightfully disclosed by a third party
without a duty of confidentiality or is independently developed by the Obligated
Party and (ii) any disclosure made in response to a valid order or other process
of a court or governmental body ("Order") and, if the Obligated Party promptly
notifies the other parties of such Order and, to the extent practicable, makes a
good faith effort to obtain a protective order requiring that such information
remains confidential and used only for the Order's purpose. As used herein,
"Intellectual Property" shall mean all copyrights (including, without
limitation, the exclusive right to reproduce, distribute copies of, display and
perform the copyrighted work and to prepare derivative works), copyright
registrations and applications, trademark rights (including, without limitation,
trade dress), trademark registrations and applications, service xxxx rights,
service xxxx registrations and applications, patent rights (including, without
limitation, the right to apply therefor), patent applications therefor
(including, without limitation, the right to claim priority under applicable
international conventions) and all patents issuing thereon and all renewals and
extensions thereof, regardless of whether any of such rights arise under the
laws of the United States of America or of any other state, country or
jurisdiction; provided, however, that the term "Intellectual Property" shall not
include the "Infusaid" trademark (which shall be subject to Section 9.3 hereof).
(c) The purchase consideration consisting of the sum of
Arrow's tax basis in the Arrow Shares plus the Assumed Liabilities shall be
allocated among the Purchased Assets for purposes of Section 1060 of the
Internal Revenue Code of 1986, as amended, and the regulations thereunder. Arrow
agrees to file, and Horizon agrees to cause the Company to file, with their
respective federal income tax returns an initial asset acquisition statement and
any supplemental statements on Internal Revenue Service Form 8594 required by
Temporary Treasury
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Regulation Section 1. 1060-1T, all in accordance with and accurately reflecting
the agreed upon allocation.
9.2 Collections. Horizon agrees to remit and to cause the
Company to remit, as the case may be, to Arrow promptly any and all amounts paid
to or received by Horizon or the Company in respect of the Purchased Assets
(including without limitation collections in respect of the Accounts Receivable
described on Schedule 1.1 hereto or otherwise of the Pump Business), and
promptly upon Arrow's request provide Arrow with an accounting of any and all
amounts so collected. Arrow agrees to remit to the Company promptly any and all
amounts paid to or received by Arrow in respect of the Port Business (including
without limitation collections in respect of accounts receivable of the Port
Business), and promptly upon the Company's request provide the Company with an
accounting of any and all amounts so collected.
9.3 Arrow's Use of "Infusaid"; "Silicone Adhesives". (a)
Subject to consummation of the transactions hereunder, effective as of the
Closing Date and for a period of twelve months thereafter and for no additional
consideration hereunder, Horizon hereby irrevocably grants to Arrow the
non-exclusive, fully paid up, royalty-free, non-terminable, worldwide right and
license to use the trademark and trade name "Infusaid" and any logo and
variation thereof in connection with Arrow's conduct of the Pump Business but
not the right for Arrow to sublicense or grant to others (except for Arrow's
affiliates, distributors, sales representatives and other representatives in the
marketing, offer for sale and sale of the products of the Pump Business) the
right to use such trademark or tradename.
(b) For a one-year period commencing on the Closing Date, the
Company shall order, on behalf of and at the expense of Arrow, and request and
use its reasonable commercial efforts to cause Dow to deliver to Arrow at such
time and places as may be reasonably requested by Arrow, such quantities of
silicone adhesives, elastomers and other supplies that may be ordered and
purchased under the Material Supply Agreement dated November 22, 1996 between
the Company and Dow Corning Corporation (the "Supply Agreement"), to the extent
such supplies are available from Dow under the Supply Agreement and, equitably
apportioning any available supplies between Arrow and the Company, taking into
consideration Arrow's and the Company's needs for such supplies.
9.4 Company's Temporary Use of Norwood, MA Plant; Special
Indemnity. During a period of up to one hundred eighty (180) days after the
Closing Date (the "Transition Period"), the Company shall be permitted, free of
rent and other periodic charges (other than long distance telephone charges,
hazardous waste disposal charges associated with the Company's operations,
product sterilization charges associated with the Company's operations and
similar charges (but not including water, electric
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or gas utilities)), to have access to, and continue the manufacturing of
products of the Port Business at, the existing plant of the Company located at
0000 Xxxxxxxxxx Xxxxxxx, Xxxxxxx, Xxxxxxxxxxxxx (the "Plant"), and in connection
therewith Horizon and, when joined as party hereto, the Company hereby covenant
and agree, jointly and severally, as follows:
(a) The Company will use the Plant only in accordance with,
and subject to, (i) all applicable laws, regulations, policies, permits,
licenses, authorizations and orders, and (ii) the terms and conditions of the
"Lease Agreement" described on Schedule 1.1 hereto (a true and complete copy of
which has been made available to and reviewed by Horizon). The Company shall
keep, observe and perform every term, provision, covenant and condition on
Arrow's part pertaining to the Plant which is required to be kept, observed and
performed pursuant to the Lease Agreement and which arises or accrues during the
Transition Period (other than the payment of rent and other periodic charges
under the Lease Agreement). The Company shall not (i) take any action
inconsistent with the terms of the Lease Agreement, (ii) do or permit to be done
by its agents, contractors, employees, invitees, visitors or licensees, anything
prohibited to Arrow as the tenant/assignee under the Lease Agreement or which
would constitute, with or without the giving of notice or the passage of time or
both, a default under the Lease Agreement; or (iii) take any action or do or
permit anything which would result in any additional cost (other than ordinary
wear and tear of that portion of the Plant used by the Company as permitted
under this Section 9.4) or other liability to Arrow under the Lease Agreement.
(b) There will be no restriction on the production level of
Company products during the Transition Period; provided, however, that the
Company's use of space in the Plant during the Transition Period for production
of its products will not exceed the space used by the Company during the 6-month
period immediately preceding the Closing Date for the production of such
products; and provided further that Horizon's or the Company's use of the Plant
and any equipment thereon during the Transition Period shall not interfere with
or restrict Arrow's operations at the Plant or any services which Arrow may be
required to render to Pfizer and affiliates under the Transition Services
Agreement.
(c) The Company and/or Horizon shall at all times during the
Transition Period maintain workmen's compensation insurance for the employees,
agents and contractors of the Company and Horizon who have access to the Plant,
and public liability, property damage, fire and extended coverage and
comprehensive general liability insurance (including without limitation product
liability), all of which insurance shall (A) cover any acts, omissions or
occurrences at, or damage to the Plant, (B) be in amounts and issued by
companies acceptable to
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Arrow, and (C) contain endorsements in form acceptable to Arrow each of which
shall name Arrow as loss payee of all casualty insurance policies covering the
Plant, and as an additional insured in respect of all other insurance maintained
by the Company and/or Horizon with respect to the Plant.
(d) The Company shall indemnify, defend and hold harmless
Arrow from and against any and all Loss and Expense (as such term is defined in
Section 10.2 hereof but excluding rent and other periodic charges which accrue
under the Lease Agreement) which Arrow may incur or sustain by reason of (i) any
breach or default under this Section 9.4 on the part of the Company or Horizon
or any of their agents, contractors, servants, employees, visitors, invitees or
licensees, (ii) any production or work by the Company, Horizon or any of their
agents, contractors, servants, employees, visitors, invitees, licensees or
subtenants in, to and at the Plant, and (iii) any act, omission or negligence on
the part of the Company, Horizon, their respective agents, contractors,
servants, employees, visitors, invitees, licensees or subtenants which result in
any personal injury or property damage (x) suffered by any Person and occurring
at or upon the Premises, or (y) suffered by the Company, Horizon or Arrow or any
of their respective agents, contractors, servants, employees, visitors,
invitees, licensees or subtenants and occurring at or upon the Premises.
(e) Arrow shall indemnify, defend, and hold harmless the
Company and Horizon from and against any and all Loss and Expense (as such term
is defined in Section 10.2 hereof) which the Company or Horizon may incur or
sustain by reason of (i) any obligations of Arrow, as tenant, under the Lease,
(ii) any production or work by Arrow or any of its agents, contractors,
servants, employees, visitors, invitees, licensees, visitor, invitee or
subtenants (other than the Company or Horizon and their respective agents,
contractors, servants, employees, visitors, invitees, licensees or subtenants as
subtenant, licensee, visitor, invitee or occupant) in, to, or at the Plant, and
(iii) any act, omission, or negligence on the part of Arrow, its agents,
contractors, servants, employees, visitors, invitees, licensees, or subtenants
which result in any personal injury or property damage (x) suffered by any
Person and occurring at or upon the Premises or (y) suffered by the Company,
Horizon or Arrow or any of their respective agents, contractors, servants,
employees, visitors, invitees, licensees or subtenants and occurring at or upon
the Premises except, in the case of both subclauses (x) and (y) of this clause
(iii), for any such act, omission or negligence to which Section 9.4(d)(iii) is
applicable.
9.5 Indemnification of Pfizer under Stock Purchase Agreement.
Horizon and Arrow acknowledge and agree that any claim for indemnification made
at any time on or after the
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Closing Date against Horizon and/or Arrow pursuant to (i) Section 7.2 of the
Stock Purchase Agreement (a "Pfizer Indemnification Claim"), and/or (ii) Section
6.3(f) of the Stock Purchase Agreement (a "Pfizer Tax Claim") shall, as between
Horizon and Arrow, be subject to the following additional terms and conditions:
(a) Notwithstanding anything contained in the Stock Purchase
Agreement to the contrary, Horizon and Arrow acknowledge and agree that, as
between Horizon and Arrow, (i) Arrow shall be responsible and liable only for
its own acts, omissions or misrepresentations which give rise to a Pfizer
Indemnification Claim and with respect to the Assumed Liabilities hereunder, and
(ii) Horizon and, when joined as party hereto, the Company shall be jointly and
severally responsible and liable only for its or their own acts, omissions or
misrepresentations which give rise to the Pfizer Indemnification Claim and with
respect to all other liabilities or obligations of the Company other than the
Assumed Liabilities. Accordingly, in the event that a Pfizer Indemnification
Claim is asserted against either party hereto in respect of the acts, omissions
or misrepresentations of the other party or with respect to any matter as to
which such other party is responsible hereunder, then such other party agrees
(and, if such other party is Horizon, then jointly and severally with the
Company when joined as a party hereto) to indemnify and hold such first party
harmless from and against any Loss and Expense (as defined in Section 10.2
hereof) incurred or suffered by such first party as a result of such Pfizer
Indemnification Claim. For purposes of this Section 9.5(a), Horizon and the
Company shall be deemed one and the same party.
(b) Notwithstanding anything contained in Section 6.3 of the
Stock Purchase Agreement to the contrary, Horizon and Arrow acknowledge and
agree that, as between Horizon and Arrow, Horizon and, when joined as party
hereto, the Company shall be responsible and liable for all Tax liabilities
referred to in the second sentence of Section 6.3(f) of the Stock Purchase
Agreement, including, without limitation, all income, sales, use and transfer
taxes, and all interest and penalties thereon arising out of the sale and
assignment by the Company of the Purchased Assets hereunder and all such taxes,
interest and penalties accruing at and after the Closing in respect of the
Company's operations, but specifically excluding any such taxes, interest or
penalties which arise, after the effectiveness of the Closing, out of Arrow's
ownership and operation of the Pump Business (such non-excluded taxes, interest
and penalties, the "Company Taxes"). Accordingly, in the event that a Pfizer Tax
Claim is ever asserted against Arrow in respect of any Company Taxes, then
Horizon and, when joined as party hereto, the Company, jointly and severally,
agree to indemnify and hold Arrow harmless from and against any Loss and Expense
(as defined in
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Section 10.2 hereof) incurred or suffered by Arrow as a result of such Pfizer
Tax Claim.
(c) The parties agree to notify each other promptly upon
receipt of a Pfizer Indemnification Claim or Pfizer Tax Claim whereupon the
parties will cooperate in good faith in order to determine which party, in
accordance with this Section 9.5, ultimately shall be responsible for any Loss
and Expense incurred or expected to be incurred as a result of such Pfizer
Indemnification Claim or Pfizer Tax Claim.
9.6 Indemnification of Arrow and Horizon under Stock Purchase
Agreement. Horizon and Arrow acknowledge and agree that any claim for
indemnification made, or proposed to be made, by either of them at any time on
or after the Closing Date against Pfizer pursuant to Section 6.3(f) and/or
Section 7.1 (including, without limitation, any claim under section 7.1 relating
to Section 5.1(e) of the Stock Purchase Agreement) of the Stock Purchase
Agreement (a "Buyer Indemnification Claim") shall, as between Horizon and Arrow,
be subject to the following additional terms and conditions:
(a) If at any time on or after the Closing Date any party
hereto becomes aware of the occurrence of an event which may give rise to a
Buyer Indemnification Claim, such party agrees to use its reasonable best
efforts to notify promptly the other parties hereto of the nature and extent of
such event and the proposed action (if any) which such party proposes take in
respect thereof, and such other parties shall then be afforded the opportunity
to join in any such action, including without limitation to assert a Buyer
Indemnification Claim in respect of any similar or related event.
(b) Each party agrees to maintain detailed and complete
records of all events which, but for any limitations contained in the Stock
Purchase Agreement (including, without limitation, the Basket and Sub-Limit),
would give rise to a Buyer Indemnification Claim of such party, and, upon the
request of another party but subject to any confidentiality restrictions, share
with and disclose to such other party such records.
(c) Horizon and Arrow agree that neither of them shall assert
Buyer Indemnification Claims for which the Cap is applicable to the extent (i)
the aggregate amount of such Buyer Indemnification Claims of Horizon would
exceed $2,676,500, or (ii) the aggregate amount of such Buyer Indemnification
Claims of Arrow would exceed $823,500.
(d) Horizon and Arrow agree to make such arrangements as shall
be appropriate to fairly and equitably allocate their respective Buyer
Indemnification Claims under the Stock Purchase Agreement to ensure that neither
Horizon nor Arrow is required to
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apply a disproportionate amount of their respective Buyer Indemnification Claims
against the Basket, it being understood and agreed that a fair and equitable
allocation of such Buyer Indemnification Claims toward the Basket would result
in $324,997.50 (76.47%) of the Basket being allocated to Buyer Indemnification
Claims to be made by Horizon and $100,002.50 (23.53%) of the Basket being
allocated to Buyer Indemnification Claims to be made by Arrow; provided,
however, that this paragraph shall not be construed as requiring either Horizon
or Arrow to make any payment to the other party if Horizon or Arrow, as the case
may be, shall not have received any indemnification payment from Pfizer for
breach of a representation or warranty under the Stock Purchase Agreement to
which the Basket shall have been applicable.
(e) Nothing in this Section 9.6 shall obligate any party to
assert a Buyer Indemnification Claim against Pfizer, such Buyer Indemnification
Claim to be asserted at the sole and complete discretion of each party.
9.7 Performance of Obligations Under Stock Purchase Agreement.
To the extent, if any, that the Stock Purchase Agreement imposes a joint and
several obligation on Arrow and Horizon that either Arrow or Horizon would be
unable to perform after the Closing Date by reason of the transfer of stock and
assets and other transactions contemplated by this Agreement, the other party
shall use its commercially reasonable efforts to ensure that it performs such
obligations under the Stock Purchase Agreement in such a manner as to ensure
that the party that is unable for such reason to perform does not incur any
liability relating to such obligations. The parties shall use commercially
reasonable efforts to ensure that Horizon and Arrow are afforded such benefits
under the Stock Purchase Agreement and related agreements, instruments and
indentures as may be equitable in view of the transactions contemplated by this
Agreement (it being the intent of the parties that, as more fully provided in
this Agreement, Horizon shall acquire the Port Business and Arrow shall acquire
the Pump Business); provided, however, that, except as otherwise expressly
provided in this Agreement, neither party shall be obligated to pay any monies
in connection with its performance of obligations under this sentence.
9.8 Phone Switch. For so long as Arrow utilizes the Plant and
premises covered by the Lease Agreement, Arrow shall pay, or reimburse the
Company for all amounts paid, after the Closing Date under the Intellipath II
Digital Centrex Service Agreement dated June 24, 1994 between the Company and
New England Telephone and Telegraph Company, as in effect on the date hereof
(the "Switch Agreement") and thereafter during the balance of the existing term
of the Switch Agreement will reimburse the Company for fifty percent (50%) of
such amounts paid thereunder. The Company shall not amend, modify or terminate
the Switch Agreement
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without the prior written consent of Arrow (which will not be unreasonably
withheld, delayed or conditioned).
10. Survival and Indemnification.
10.1 Survival. The representations, warranties, covenants and
agreements of Horizon, Arrow or the Company contained in or made pursuant to
this Agreement and in any certificate furnished pursuant to this Agreement which
have not been fully discharged at Closing, shall survive the execution and
delivery hereof and thereof and shall continue in full force until the first
anniversary of the Closing Date, provided, however, that (i) the representations
and warranties contained in Sections 4.4 and 5.5 shall survive indefinitely
(subject to applicable statutes of limitation), (ii) the covenants and
agreements contained in Sections 9, 10, 11.4 and 11.5 and any other covenants
and agreements which by their terms are to be performed or complied with after
the Closing Date shall continue in full force and effect until fully performed
and discharged; and (iii) Arrow's obligation to pay, perform and discharge the
Assumed Liabilities shall survive until such Assumed Liabilities have been paid,
performed or discharged in full. No claim for indemnification may be asserted
after the expiration of the applicable period specified in the preceding
sentence; provided that any representation or warranty with respect to which a
claim has been asserted in writing prior to the expiration of the period set
forth above shall survive with respect to such claim until the final resolution
thereof.
10.2 Indemnification of Arrow. Without limitation of any
rights of Arrow pursuant to Sections 9.4, 9.5 and 9.6 hereof, Horizon and, when
joined as party hereto, the Company hereby agree, jointly and severally, to
indemnify and hold Arrow harmless from and against any and all damages, claims,
losses, expenses, costs, obligations, liabilities, assessments and penalties,
including, without limiting the generality of the foregoing, liabilities for
reasonable attorneys' fees and expenses (collectively, "Loss and Expense"),
suffered, directly or indirectly, by Arrow by reason of, or arising out of, (i)
any breach of any representation or warranty made by Horizon or the Company in
this Agreement (subject to Section 10.1), (ii) any failure by Horizon or the
Company to perform or fulfill any of their respective covenants or agreements
set forth in this Agreement, (iii) any claim by MiniMed, Inc. or its successors,
assigns or affiliates relating to MiniMed, Inc.'s proposed acquisition jointly
with Horizon, of the capital stock of the Company, and/or (iv) any of the
liabilities or obligations of the Company (including without limitation those
described in Section 1.4 hereof) which are not expressly assumed by Arrow
pursuant to Section 1.3.
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10.3 Indemnification of Horizon and the Company. Without
limitation of any rights of Horizon and the Company pursuant to Sections 9.5 and
9.6 hereof, Arrow hereby agrees to indemnify and hold Horizon and, when joined
as party hereto, the Company harmless from and against any and all Loss and
Expense suffered, directly or indirectly, by Horizon or the Company by reason
of, or arising out of, (i) any breach of any representation or warranty made by
Arrow in this Agreement (subject to Section 10.1), (ii) any failure of Arrow to
perform or fulfill any of its covenants or agreements set forth in this
Agreement, and/or (iii) any failure by Arrow to perform or discharge any Assumed
Liabilities.
10.4 Notice of Claims. If Arrow, Horizon or the Company
believes that it has suffered or incurred any Loss and Expense for which it may
seek indemnification under this Section 10, such party shall notify the other
promptly in writing, and in any event within the applicable time period
specified in Section 10.1, describing such Loss and Expense, the amount thereof,
if known, and the method of computation of such Loss and Expense, all with
reasonable particularity and containing a reference to the provisions of this
Agreement in respect of which such Loss and Expense shall have occurred. If any
action at law or suit in equity is instituted by a third party with respect to
which any of the parties intends to claim any liability or expense as Loss and
Expense under this Section 10, such party shall promptly notify the indemnifying
party of such action or suit. The failure of the indemnified party to notify the
indemnifying party as provided in this Section 10.4 shall not relieve the
indemnifying party from indemnification obligations with respect thereto except
to the extent that the indemnifying party suffers actual loss or material
prejudice as a result of such failure.
10.5 Defense of Third Party Claims. The indemnifying party
under this Section 10 shall have the right to conduct and control, through
counsel of its own choosing, any third party claim, action, or suit, but the
indemnified party may, at its election, participate in the defense of any such
claim, action, or suit at its sole cost and expense; provided, however, that if
(i) the indemnifying party shall fail to defend any such claim, action, or suit
or shall fail to notify the indemnified party of its election to defend, or
elects not to defend, within 30 days of its receipt of notice thereof from the
indemnified party, any such claim, action or suit, or (ii) the indemnifying
party and the indemnified party mutually agree, then the indemnified party may
defend, through counsel of its own choosing, such claim, action or suit and (so
long as it gives the indemnifying party at least 15 days' notice of the terms of
the proposed settlement thereof and permits the indemnifying party to then
undertake the defense thereof) settle such claim, action or suit, and recover
from the indemnifying party the amount of such settlement or of any judgment and
the costs and expenses of such defense. If the
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indemnifying party chooses to defend any such claim, action or suit, the
indemnified party shall cooperate with the indemnifying party and shall make
available to the indemnifying party any books, records or other documents within
its control that are necessary or appropriate for such defense.
10.6 Certain Limitations. Notwithstanding anything in this
Agreement to the contrary, no Loss or Expense shall be recovered by Arrow or
Horizon, as applicable, under Section 10.2 or 10.3 with respect to any matter
which is covered by insurance to the extent proceeds of such insurance are
received by the indemnified party (net of any additional cost incurred by reason
of such recovery).
10.7 Bulk Sales Indemnity. Arrow hereby waives compliance with
the provisions of any applicable bulk sales or transfer laws in connection with
sale of the Purchased Assets contemplated by this Agreement. Horizon and, when
joined as party hereto, the Company agree, jointly and severally, to indemnify
and hold Arrow harmless from and against any and all Loss and Expense, including
without limitation any claims made by creditors and any Loss and Expense arising
out of or relating to any Encumbrance on Purchased Assets arising out of or
relating to the Company's non-compliance with any applicable bulk sales or
transfer laws, arising out of Horizon's and/or the Company's non-compliance with
any applicable bulk sales or transfer laws in connection with the sale of the
Purchased Assets contemplated by this Agreement, except to the extent that any
such Loss and Expense results from or arises out of any failure by Arrow to pay
or perform, when due, any Assumed Liabilities or any other obligations to be
paid or performed by Arrow as provided in this Agreement. The parties agree that
the Section 10.04 and 10.05 hereof shall also be deemed to refer to any Loss and
Expense under this Section 10.07.
10.8 Exclusive Remedies. After the Closing Date, the rights of
indemnification contained in Section 10.2 and Section 10.3, respectively, shall
be deemed to be the exclusive remedy of the parties hereto with respect to a
default or breach by any other party or other claim under or with respect to
this Agreement.
11. Miscellaneous
11.1 Termination of Agreement; Liabilities. (a) This Agreement
may be terminated by Horizon and Arrow at any time prior to the Closing Date:
(i) By the mutual written consent of Horizon and Arrow; or
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(ii) By Horizon if any of the conditions provided in Section
8 hereof have not been met by the time required and have not been waived; or
(iii) By Arrow if any of the conditions provided in Section 7
hereof have not been met by the time required and have not been waived; or
(iv) By Arrow or Horizon if the Closing of the purchase and
sale contemplated by this Agreement has not been fully completed by August 29,
1997.
(b) In the event that this Agreement is terminated
pursuant to Section 11.1(a), neither party hereto shall have any liability to
the other party for costs, expenses, damages, loss of anticipated profits or
otherwise.
11.2 Further Assurances. Subject to the other provisions of
this Agreement, Horizon and, when joined as party hereto, the Company agree that
after the Closing Date each of them shall, from time to time, upon the
reasonable request of Arrow, execute and deliver such other instruments of
conveyance and other similar documents and take such other actions as Arrow may
reasonably require, consistent with the terms of this Agreement, as are
reasonably necessary or desirable to transfer to Arrow title to the Purchased
Assets and to otherwise perform the provisions of this Agreement to be performed
by Horizon and the Company. From and after the Closing Date, upon the reasonable
request of Horizon or the Company, Arrow shall execute, deliver and acknowledge
all such further instruments of conveyance and other similar documents and take
such other actions as Horizon or the Company may reasonably require, consistent
with the terms of this Agreement, as are reasonably necessary or desirable to
transfer to the Company title to the Arrow Shares and to otherwise perform the
provisions of this Agreement to be performed by Arrow.
11.3 Benefit of Agreement. This Agreement shall be binding
upon and inure to the benefit of Arrow, Horizon and, when joined as party
hereto, the Company and their respective successors and assigns and shall not
confer any rights upon any third persons (including without limitation Pfizer
or, before the Closing, the Company).
11.4 Expenses. Except as otherwise provided herein, each
party hereto agrees to pay its expenses incurred in connection with the
transactions contemplated by this Agreement, including, without limitation, the
fees and expenses of its accountants and counsel.
11.5 Covenants Not to Compete; Use of "Infusaid" on Pumps.
(a) Horizon and, when joined as party hereto, the Company
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jointly and severally covenant and agree with Arrow that, (i) until the third
anniversary of the Closing Date, neither Horizon, the Company nor any of their
direct or indirect subsidiaries will manufacture, market, sell or otherwise
distribute, or participate in the ownership, management of operation of any
business which manufactures, markets, sells or otherwise distributes of any
implantable infusion pump products and (ii) from and after the Closing Date,
neither Horizon, the Company nor any of their direct or indirect subsidiaries
will use or permit any Person (other than Arrow) to use the trademark or trade
name "Infusaid" or any logo or variation thereof in connection with the
manufacture, sale, offer for sale, license, or distribution of implantable
infusion pump products.
(b) Arrow covenants and agrees with Horizon and, when joined
as party hereto, the Company that, until the third anniversary of the Closing
Date, neither Arrow nor any of its direct or indirect subsidiaries will market,
sell or otherwise distribute its implantable infusion port products through any
of the distributors listed in Schedule 11.5 hereto.
11.6 Confidentiality. (a) For a period of two (2) years after
the Closing Date, all proprietary information of the Pump Business conveyed by
the Company to Arrow pursuant to this Agreement and all proprietary information
of Arrow's business operations shall be treated by Horizon and the Company as
confidential unless (i) such information is or becomes part of the public
knowledge or literature through no fault of Horizon or the Company; (ii) such
information shall otherwise become available to Horizon or the Company from a
source other than Arrow, said source not being known by Horizon or the Company
to be violative of any obligation of secrecy with respect to such information;
or (iii) Horizon or the Company is legally required to disclose such information
provided that, to the extent practicable, either of them gives Arrow a
reasonable opportunity to seek a protective order. Horizon and the Company shall
use all reasonable efforts to prevent the use of all or any part of such
confidential information in any other connection or the transmission thereof to
third parties unless and until they have first obtained the written consent of
Arrow specifically authorizing such use or transmission.
(b) For a period of two (2) years after the Closing Date, all
proprietary information of the Port Business retained by the Company and all
proprietary information of Horizon's business operations shall be treated by
Arrow as confidential unless (i) such information is or becomes part of the
public knowledge or literature through no fault of Arrow; (ii) such information
shall otherwise become available to Arrow from a source other than Horizon or
the Company, said source not being known by Arrow to be violative of any
obligation of secrecy with respect to such information; or (iii) Arrow is
legally required
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to disclose such information, provided that, to the extent practicable, it gives
Horizon and the Company a reasonable opportunity to seek a protective order.
Arrow shall use all reasonable efforts to prevent the use of all or any part of
such confidential information in any other connection or the transmission
thereof to third parties unless and until it has first obtained the written
consent of Horizon and/or the Company specifically authorizing such use or
transmission.
11.7 Entire Agreement; Amendments. This Agreement constitutes
the entire agreement between the parties pertaining to the subject matter
contained herein, and supersedes all prior agreements, arrangements and
understandings of the parties (including, without limitation, the letter
agreements between Horizon and Arrow International, Inc. dated June 17, 1997 and
June 19, 1997), except for the Stock Purchase Agreement. No supplement,
modification or amendment of or to this Agreement shall be binding, unless
executed in writing by the parties hereto. No waiver of any of the provisions of
this Agreement shall be deemed, or shall constitute, a waiver of any other
provision, whether or not similar, nor shall any waiver constitute a continuing
waiver. No waiver shall be binding unless executed in writing by the party
granting the waiver.
11.8 Stock Purchase Agreement. The transactions contemplated
hereby shall in no event limit or otherwise affect the respective rights of
Arrow and Horizon under or arising out of the Stock Purchase Agreement, and by
tendering the Arrow Shares to the Company hereunder on the Closing Date Arrow
shall not be deemed to have relinquished any rights or remedies it now has or
hereafter may have under the Stock Purchase Agreement, all of which are retained
by Arrow notwithstanding the consummation of the transactions hereunder.
11.9 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed an original, and all of which
shall constitute one and the same instrument.
11.10 Section and Paragraph Headings. The index, section and
paragraph headings of this Agreement are included for purposes of convenience
only and shall not affect in any way the construction or interpretation of any
of the provisions of this Agreement.
11.11 Notices. All notices, requests, demands and other
communications under this Agreement shall be in writing and shall be deemed to
have been given on the date when delivered personally or sent by facsimile, the
next business day after delivery to a nationally recognized overnight delivery
service, or on the seventh day after mailing if mailed by first class mail,
registered or certified, postage prepaid, and properly
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addressed as follows or to such other address as either party may designate by
notice to the other party:
(a) To Horizon and, after Closing,
the Company at:
Horizon Medical Products, Inc.
0000 Xxxxxxxxx Xxxxxxx, X.X.
Xxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: President
with a copy to:
Xxx X. Xxxxxxxxx, III, Esq.
Xxxxxxxxx & Virgin
Xxxxx 0000
000 Xxxxxx Xxxxxx
0000 Xxxxxxxxx Xxxxxx, X.X.
Xxxxxxx, Xxxxxxx 00000
Fax No: (000) 000-0000
(b) To Arrow at:
Arrow Interventional, Inc.
c/o Arrow International Inc.
X.X. Xxx 00000
Xxxxxxx, XX 00000
0000 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: President
with a copy to:
Arrow International Inc.
X.X. Xxx 00000
Xxxxxxx, XX 00000
0000 Xxxxxxxxx Xxxx
Xxxxxxx, XX 00000
Fax: (000) 000-0000
Attention: President
and to:
Xxxxxxx X. Xxxxxx, Xx., Esq.
Nixon, Hargrave, Devans & Xxxxx LLP
000 Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Fax: (000) 000-0000
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11.12 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED EXCLUSIVELY IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK, WITHOUT REFERENCE TO ITS CONFLICTS OF LAW PRINCIPLES.
11.13 Submission to Jurisdiction; Consent to Service of
Process. (a) The parties hereto hereby irrevocably submit to the non-exclusive
jurisdiction of any federal or state court located within the State of New York
over any dispute arising out of or relating to this Agreement or any of the
transactions contemplated hereby and each party hereby irrevocably agrees that
all claims in respect of such dispute or any suit, action or proceeding related
thereto may be heard and determined in such courts. The parties hereby
irrevocably waive, to the fullest extent permitted by applicable law, any
objection which they may now or hereafter have to the laying of venue of any
such dispute brought in such court or any defense of inconvenient forum for the
maintenance of such dispute. Each of the parties hereto agrees that a judgment
in any such dispute may be enforced in other jurisdictions by suit on the
judgment or in any other manner provided by law.
(b) Each of the parties hereto hereby consents to process
being served by any party to this Agreement in any suit, action or proceeding by
the mailing of a copy thereof in accordance with the provisions of Section 11.11
hereof.
11.14 Interpretation. The parties acknowledge and agree that:
(i) each party and its counsel reviewed and negotiated the terms and provisions
of this Agreement and have contributed to its revision; (ii) the rule of
construction to the effect that any ambiguities are resolved against the
drafting party shall not be employed in the interpretation of this Agreement;
and (iii) the terms and provisions of this Agreement shall be construed fairly
as to all parties hereto, regardless of which party was generally responsible
for the preparation of this Agreement.
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IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be executed and delivered by its duly authorized officer as of the
day and year first above written.
HORIZON MEDICAL PRODUCTS, INC.
By:
------------------------------
Name:
Its:
ARROW INTERVENTIONAL, INC.
By:
------------------------------
Xxxx X. Xxxxxxxxx, Xx.
Vice President - Finance
Joining Party effective as
of the Closing Date:
STRATO/INFUSAID, INC.
By:
------------------------------
Name:
Its:
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ARROW INTERNATIONAL, INC. GUARANTY
For good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, Arrow International, Inc., a Pennsylvania
corporation ("Arrow"), hereby guarantees to Horizon Medical Products, Inc., a
Georgia corporation ("Horizon"), and Strato/Infusaid, Inc., a Massachusetts
corporation ("Strato"), the complete payment and performance by Arrow
Interventional, Inc., a Delaware corporation ("Buyer"), of Buyer's obligations
under the Asset Purchase and Stock Redemption Agreement dated as of July 15,
1997 among Buyer, Horizon and Strato (the "Agreement"). Arrow hereby waives
notice of, and proof of reliance by Horizon and Strato upon and acceptance of,
its guarantee herein, and of nonperformance by Buyer of any of its obligations
under the Agreement and of any other notices or demands of any kind whatsoever.
Horizon, Strato and Buyer may enter into any amendment, assignment, waiver or
modification of the Agreement, whether or not such amendment, assignment, waiver
or modification would in any way increase or decrease the extent of Arrow's
obligations hereinafter, without notice to or consent of Arrow and without
thereby releasing Arrow hereunder or incurring any liability to Arrow. The
obligations of Arrow under this paragraph shall not be released or affected by
voluntary or involuntary proceedings by or against Buyer in bankruptcy or for
reorganization or other relief under any bankruptcy or insolvency law. Arrow's
guarantee shall continue to be effective or shall be reinstated automatically,
as the case may be, if at any time any payment, or any part thereof, by Buyer is
rescinded or must otherwise be returned by Horizon or Strato upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of Buyer as
though any such payment had not been made.
Arrow covenants and agrees that it shall be bound by the
provisions of Section 11.5(b) and Section 11.6 of the Agreement as if Arrow were
the "Arrow" referred to therein.
Arrow represents and warrants to Horizon and Strato that:
(a) Arrow is a corporation duly organized, validly existing
and in good standing under the laws of Pennsylvania, and has the requisite
corporate power and authority to execute and deliver this Guaranty and the
documents, agreements and certificates (collectively, the "Arrow Documents")
which are required to be executed and delivered by Arrow pursuant to this
Guaranty and to perform in all respects its obligations hereunder and
thereunder. Arrow is duly qualified or licensed to do business and in good
standing in each jurisdiction in which the nature of its business or the
character of the assets owned or leased by Arrow makes such qualification or
licensing necessary, except where the failure to be so qualified or licensed
would not
37
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impair or otherwise adversely affect the transactions contemplated hereunder.
(b) The execution, delivery and performance of this Guaranty
and the Arrow Documents have been duly authorized by all requisite corporate
action on the part of Arrow. This Guaranty has been duly executed and delivered
by Arrow and constitutes, and each of the Arrow Documents when executed and
delivered will constitute, the valid and binding obligation of Arrow,
enforceable in accordance with and subject to their respective terms, except as
limited by bankruptcy, insolvency, reorganization and similar laws affecting the
enforcement of creditors' rights or contractual obligations generally. The
execution, delivery and performance by Arrow of this Guaranty and the Arrow
Documents and the consummation of the transactions contemplated hereby and
thereby will not: (i) violate any provision of the Certificate of Incorporation
or By-laws of Arrow; (ii) violate any provision of any judicial, arbitral or
administrative order, award, judgment or decree applicable to Arrow; (iii)
conflict with, result in a material breach of or constitute a default under any
agreement or instrument to which Arrow is a party or by which it is bound; (iv)
violate, in any material respect, any applicable law, rule, ordinance or
regulation applicable to Arrow; or (v) require Arrow to obtain the consent,
approval or authorization of, or require Arrow to file any certificate, notice,
application, report or other document with, any federal, state or local
governmental authority or agency or other person or entity.
(c) There are no judicial, arbitral or administrative actions,
suits or proceedings or, to the knowledge of Arrow, any investigations pending
against Arrow which would, if adversely determined, prevent, hinder, delay or
otherwise adversely affect the consummation of the transactions contemplated
hereby. Arrow is not a party to or subject to the provisions of any order,
decree or judgment of any court or of any governmental agency which may prevent,
hinder or otherwise adversely affect the consummation of the transactions
contemplated hereby.
This Guaranty shall be governed by and construed in accordance
with the laws of the State of New York without reference to its principles of
conflicts of law.
IN WITNESS WHEREOF, the undersigned has caused the Guaranty to
be executed and delivered as of the date of the foregoing Agreement.
ARROW INTERNATIONAL, INC.
By:
--------------------------------
Xxxx X. Xxxxxxxxx, Xx.
Vice President - Finance
