EXHIBIT 10.16
TOKUMEI KUMIAI AGREEMENT
This Tokumei Kumiai Agreement is made this 1st day of April, 2000, between
Xxxxxx Limited, a company organized under the laws of Japan having its head
office at 0, Xxxxxxxxxx, Xxxxxxx-xx, Xxxxx, Xxxxx, as Eigyo-sha (the
"Operator"), and Xxxxxxx Lifesciences Finance Limited, a company established
under the laws of Japan having its head office at 0-0 Xxxxxxxxxx, Xxxxxxx-xx,
Xxxxx, Xxxxx, as Tokumei Kumiai-In (the "Investor").
WITNESSETH:
WHEREAS, the Operator has been engaged in various businesses in Japan,
including: (i) the cardiovascular business described in Exhibit A hereto("CV
Business"); (ii) the renal business to manufacture, import, and distribute
products and provide services to improve therapies to treat and combat kidney
disease; (iii) the biotechnology business to import and distribute products and
therapies and to provide services in transfusion medicine; and (iv) the
intravenous business described in Exhibit B hereto ("IV Business").
AND WHEREAS, the Operator has established the CV Business in Japan, possesses
all relevant CV Business import licenses in Japan, has established effective
distribution channels in Japan, has employees fully dedicated to the success of
the CV
Business in Japan, and desires to increase the value of the CV Business in
Japan;
AND WHEREAS, the Operator has established the IV Business in Japan, possesses
all relevant IV Business import licenses in Japan, has established effective
distribution channels in Japan, has employees fully dedicated to the success of
the IV Business in Japan, and desires to increase the value of the IV Business
in Japan but such business is currently too small to operate economically unless
it can share staff and other resources with the CV Business;
AND WHEREAS, the Operator desires current access to capital, for purposes of the
CV Business and IV Business and for purposes of a one-time loan of unused funds
to certain Affiliates of Operator, in a form which will complement its future
financing options and decisions, and which will not inhibit its ability to
engage in future financing related to any of its businesses;
AND WHEREAS, the Operator wishes to increase the value of its CV Business and IV
Business in Japan, but also desires to reduce its overall exposure to the annual
variability in the profitability of the CV Business, and wishes to grow the
small IV Business to a size where it can economically operate as a stand alone
division independent of the CV Business;
AND WHEREAS, as an eigyo sha of a tokumei kumiai ("TK") as described in Articles
535 through 542 of the Japanese Commercial Code, the Operator is willing to
provide the Investor, as a tokumei kumiai'in of a TK, with a share of the
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annual profits or losses of the CV Business and the IV Business, in recognition
of the following consideration from the Investor:
* the amount of the TK contribution under this Agreement;
* the willingness of the Investor to forego any right to share in any
appreciation in the value of the CV Business and the IV Business over the term
of this Agreement;
* the willingness of the Investor to grant the Operator the right to withdraw
the IV Business from the TK Business pursuant to Article 11 hereof;
AND WHEREAS, the Investor desires to provide financing, through the contribution
as the Investor, to the Operator and to receive profits or losses realized from
the CV Business and IV Business, subject to the risks and rewards of the CV
Business and IV Business, in accordance with the terms of this Agreement;
NOW, THEREFORE, in consideration of the promises and mutual covenants contained
herein and other good consideration, the parties hereto agree as follows:
Article 1. Definitions
In this Agreement the following expressions shall, except where the context
otherwise requires, have the following respective meanings:
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"Account" shall mean the deposit account in the name of the Operator established
at the head office of The Bank of Tokyo Mitsubishi, Ltd. or such other bank
accounts as may be established by the Operator from time to time and notified to
the Investor.
"Affiliate" shall mean, with respect to either party, a juridical person (i)
that owns, directly or indirectly, at least fifty percent (50%) of the voting
shares or ownership interest in such party, or (ii) at least fifty percent (50%)
of the voting shares or ownership interest of which are owned, directly or
indirectly, by an Affiliate as defined in item (i).
"Agreement" shall mean this Tokumei Kumiai Agreement, as originally executed by
the parties hereto and as the same may be amended, modified or supplemented from
time to time in accordance with the terms hereof.
"Auditor" shall mean PricewaterhouseCoopers or such successor firm (also serving
as general corporate auditor for the Operator) as may be appointed by the
Operator.
"Capital Contribution" shall mean the amount that the Investor shall contribute
to the Operator pursuant to Article 4 herein. The parties hereto hereby confirm
that the Capital Contribution has been determined after considering (i) the fair
market value of the CV Business and the IV Business of the Operator, which have
been appraised by PricewaterhouseCoopers as of February 29, 2000, and (ii) the
value of the one time loans included within the TK Business.
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"CV Business" shall have the meaning set forth in the first recital and shall
include, after the date hereof, all activities conducted by Operator pursuant to
the Japan Distribution Agreement.
"Effective Date" shall mean the date first written above or such other date as
the parties hereto agree.
"Fiscal Period" shall mean each month following the Effective Date. The first
Fiscal Period shall commence on the Effective Date and end on April 30, 2000.
"IV Business" shall have the meaning set forth in the first recital.
"Investor's Allocation Formula" shall mean 90% of the "Net Profits" or "Net
Losses", as the case may be, plus 10% of the "Notional Yield" and, in accordance
with Article 5, Paragraph 3, below, shall not include Profits or Losses
attributable to realized or unrealized appreciation or depreciation of the TK
Business or the Property upon expiration or termination of this Agreement.
"Japan Distribution Agreement" shall mean the Japan Distribution Agreement dated
as of April 1, 2000 between Operator and Xxxxxxx Lifesciences LLC, an Affiliate
of Investor, as the same may be amended from time to time.
"Losses" shall mean the Net Loss Before Income Tax, if any, of the Operator
arising from the operation of the TK Business as shall be determined by the
Operator in accordance with generally accepted accounting principles applicable
in Japan,
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subject to audit review rights as set forth in Article 8 below.
"Net Losses" shall mean, for any Fiscal Period, (i) the excess, if any, of the
"Notional Yield" over the "Profits" for such Fiscal Period or (ii) the "Losses"
less the "Notional Yield" (i.e. the Notional Yield amount will increase the Net
Losses) for such Fiscal Period.
"Net Profits" shall mean, for any Fiscal Period, the excess, if any, of the
"Profits", over the "Notional Yield" for such Fiscal Period.
"Notional Yield" shall mean the monthly return on a notional investment of (Yen)
23.2 billion, paying a rate of return equivalent to the annual coupon rate as of
April 3, 2000 on ten-year Japanese Government Bonds plus 50 basis points;
provided that Notional Yield for the first month under this Agreement shall be
calculated from April 3, 2000 forward.
"Operator's Allocation Formula" shall mean 10% of the "Net Profits" or "Net
Losses", as the case may be, plus 90% of the "Notional Yield".
"Payment Date" shall mean April 3, 2000.
"Profits" shall mean the Net Income Before Income Taxes, if any, of the Operator
arising from the operation of the TK Business as shall be determined by the
Operator in accordance with generally accepted accounting principles applicable
in Japan, subject to audit review rights as set forth in Article 8 below.
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"Property" shall mean all of the assets and property of the Operator which are
utilized by the Operator in the operation of the TK Business.
"TK Business" shall mean the CV Business, the IV Business and the one-time loan
of unused funds to certain Affiliates (Xxxxxx World Trade S.A., a Belgium
company and Xxxxxx Holdings Limited) of Operator.
"Tokumei Kumiai" shall mean the tokumei kumiai relationship established pursuant
to the terms of this Agreement and Articles 535 through 542 of the Commercial
Code of Japan.
Article 2. The Tokumei Kumiai
(1) The purpose of the Tokumei Kumiai shall be to achieve the business
objectives of the Operator and the Investor as summarized above, and to
allocate and distribute the Profits or Losses of the TK Business between
the Investor and the Operator in accordance with the terms of this
Agreement.
(2) The Operator shall use the Capital Contribution for purposes of the TK
Business.
(3) The Operator shall use reasonable care in the conduct of the TK Business
with the intention of preserving the Property and maximizing the Profits,
but shall not be deemed to have breached this Article 2(3) in the absence
of gross negligence or willful or wanton misconduct.
(4) The TK Business shall be conducted by and under the name of the Operator as
a separate division.
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(5) The Investor acknowledges and agrees that it shall have no ownership rights
or claims whatsoever in respect of the Property and shall have no right to
participate in the operation or management of the TK Business, which in all
respects shall be conducted solely by the Operator, and to participate in
the results thereof in the manner and to the extent as provided herein.
(6) The Operator acknowledges and agrees that this Agreement does not
constitute the Operator as an agent or legal representative of the Investor
for any purpose and that the Operator is not authorized to assume or create
any obligation or responsibility, expressed or implied, on behalf or in the
name of the Investor, or to bind the Investor in any manner.
Article 3. Representations and Warranties of the Operator
The Operator hereby represents and warrants to the Investor as follows:
(1) Authority of Operator
The Operator has full power, authority and legal right to enter into this
Agreement, to perform its obligations hereunder and to conduct the TK Business.
(2) Government and Third Party Consents
No material consent, authorization, license, permit, registration or approval
of, or other action by, or notice to, any governmental or public body or
authority or any other party is required in connection with the Operator's
execution
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and delivery of this Agreement or the performance by the Operator of its
obligations hereunder.
(3) Effect of Agreement
The Operator's execution and delivery of this Agreement, performance of the
Operator's obligations hereunder and consummation of the transactions
contemplated hereby will not (a) violate any provision of any material statute,
law, act, ordinance, or other code, decree, order, rule, regulation, license,
permit, authorization of any governmental body or court to which Operator is
subject; or (b) violate any material judgment, order, writ, injunction or decree
of any court applicable to the Operator.
(4) Restrictive Documents
The Operator is not subject to, or a party to, any material mortgage, lien,
lease, license, permit, agreement, contract, instrument, law, rule, ordinance,
regulation, order, judgment or decree, or any other material restriction of any
kind or character, which would prevent consummation of the transactions
contemplated by this Agreement, compliance by the Operator with the terms,
conditions and provisions hereof or the continued operation of the Operator's
business after the date hereof on substantially the same basis as heretofore
operated, aside from that certain Option Agreement dated March 31, 2000 between
Operator and Xxxxxxx Lifesciences Limited, which has been disclosed to the
Investor.
(5) Financial Statements
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The Operator has heretofore furnished the Investor with copies of (1) the income
statement of the Operator for the period from April 1, 1998 through March 31,
1999, and (2) the balance sheet of the Operator as of March 31, 1999, both of
which financial statements have been attached as Exhibit C hereto (the
"Financial Statements"). The Financial Statements fairly present the financial
condition and results of operations of the Operator as of the dates and for the
periods therein specified in conformity with generally accepted accounting
principles applicable in Japan, except for the absence of footnotes and for
normal year-end audit adjustments.
(6) No Adverse Changes
Since March 31, 1999 there has not been (a) any material adverse change in the
financial condition or in the results of operations, business, prospects,
Property or assets of the Operator not provided for or disclosed in the
Operator's business plan provided to the Investor; (b) any material loss,
damage, destruction or other casualty to the Property or assets of the Operator
not covered by insurance; (c) any material change in any material method of
accounting or accounting practice; (d) any material adverse change in the
relationships of the Operator with its principal suppliers, customers or
employees; (e) any material capital expenditure by the Operator or commitment
therefor not provided for in the Operator's business plan provided to the
Investor; (f) except as contemplated by the Japan Distribution Agreement, any
amendment or termination of any material contract, lease or other instrument to
which it is a party or any agreement
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to amend or terminate any such contract, lease or instrument; and (g) any sale,
assignment or transfer of any material asset or Property of the Operator.
(7) Litigation
Except for the case of Nippon Zion x. Xxxxxx Limited, currently pending in the
Tokyo District Court and previously disclosed to Investor, there are no material
actions, suits, proceedings or investigations pending or, to the best knowledge
of the Operator, threatened against the Operator which might materially
adversely affect the CV Business, the IV Business, the Property, or any other
assets or rights of the Operator.
Article 4. Capital Contributions
(1) The Investor shall transfer 23.2 billion yen ((Yen) 23,200,000,000) in
immediately available funds to the Account as its original Capital
Contribution to the Operator on the Payment Date.
(2) The Investor shall make additional Capital Contributions to the Operator on
a monthly basis, if and as required by Article 5(5), such that the
remaining balance of the Investor's original Capital Contribution shall not
be diminished by the portion of Net Losses allocable to the Investor under
the Investor's Allocation Formula.
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Article 5. Distribution and Allocation of Profits and Losses
(1) The Operator shall compute the Profits or Losses, as the case may be, and
Notional Yield for each Fiscal Period, and notify the Investor of the same
within 10 days after the end of such Fiscal Period. The Profits and Losses
shall include actual interest earned from the one-time loan of unused funds
to certain Affiliates and shall be determined after allocating the costs
and expenses of the Operator among the CV Business, the IV Business and its
other businesses in a reasonable manner to be separately determined between
the Operator and the Investor. If any subsequent adjustments are required
(by reason of audit or otherwise) to the Profits or Losses computed for any
particular Fiscal Period, those adjustments shall be taken into account in
determining Profits or Losses for the Fiscal Period in which such
adjustments are made.
(2) The Operator shall allocate the Net Profits, Net Losses, and Notional Yield
for each Fiscal Period to the Investor in accordance with the Investor's
Allocation Formula.
(3) Profits or Losses attributable to unrealized appreciation or depreciation
of the CV Business, the IV Business or the Property (or to appreciation or
depreciation realized as a result of the expiration or termination, or any
event that causes the expiration or termination, of this Tokumei Kumiai
Agreement, below),
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shall, upon expiration or termination of this Tokumei Kumiai Agreement
pursuant to Article 12, be allocated wholly to the Operator.
(4) The amount of the Net Profits and Notional Yield allocated to the Investor
pursuant to Article 5(2) shall be distributed to the Investor within 25
days after the end of the applicable Fiscal Period, by remitting cash to
the bank account of the Investor notified to the Operator. For avoidance
of doubt, unused funds lent out under the TK Business shall be deemed
available for remittance up to the amount of any such distribution. The
remaining Net Profits and Notional Yield, being those allocated to the
Operator, shall be deemed to be distributed to the Operator at the same
time.
(5) If, for any Fiscal Period, Net Losses are allocated to the Investor
pursuant to Article 5(2), the Investor shall make an additional Capital
Contribution equal to the amount of such allocated Net Loss to the Operator
within 25 days after the end of the applicable Fiscal Period.
Article 6. Liability of the Operator
All obligations and liabilities of any kind incurred with respect to the TK
Business shall be liabilities of the Operator and not the Investor. However,
liabilities incurred by the Operator with respect to the CV Business or (subject
to Article 11) the IV Business, including product liabilities attributable to
the CV Business or IV Business, will be
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included within the computation of Profits and Losses herein for the periods in
which they accrue.
Article 7. Rights of Investor
The Investor, its employees, directors or agents, may after giving prior written
notice to the Operator, during the Operator's regular business hours, examine
the condition of the Property and the activities of the Tokumei Kumiai and audit
the Tokumei Kumiai's books of account and other records at its own cost.
Article 8. Accounting
(1) The Operator shall prepare and maintain accurate books of account and
records covering all transactions relating to the TK Business.
(2) The Operator shall, within 10 days after the end of each Fiscal Period,
prepare and deliver to the Investor financial statements of the Tokumei
Kumiai for the relevant Fiscal Period.
(3) The Operator shall, within 90 days after the end of each calendar year,
provide to the Investor audited financial statements of the Tokumei Kumiai
for that calendar year.
(4) The Operator shall, within 90 days after the expiration or the termination
of this Agreement, provide to the Investor audited financial statements
with respect to the Tokumei Kumiai for the period commencing the day
following the end of its immediately preceding calendar
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year and ending as of the date of the expiration or the termination.
(5) The Investor shall be entitled (i) to request that the Operator produce
audited financial statements, and/or (ii) to conduct its own audit of the
financial statements, in each case for any Fiscal Period or Fiscal Periods.
If the Investor does not agree with the results of any such audited
financial statements produced by the Operator pursuant to (i) above, or if
the Operator does not agree with the results of any such audit conducted by
the Investor pursuant to (ii) above, such dispute will be resolved pursuant
to Article 21. The cost of any such audits performed by or for the
Operator pursuant to (i) above shall be charged to the Tokumei Kumiai. The
cost of any such audits performed by or for the Investor pursuant to (ii)
above shall be borne by the Investor; provided, however that if a
discrepancy of more than 5% of the reported Profit or Loss for the Fiscal
Period or Fiscal Periods subject to such audit is ultimately found to exist
between the audit performed by or for the Investor (as adjusted pursuant to
the dispute resolution procedures of Article 21) and the financial
information provided to the Investor by the Operator, the cost of the audit
shall be borne by the Operator.
Article 9. Assignment
(1) The Operator shall not be permitted to assign any of its rights, duties or
obligations under this Agreement to
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any non-Affiliates without the prior written consent of the Investor.
(2) The Investor shall be permitted to assign any or all of its rights under
this Agreement to any third party without the consent of the Operator.
Article 10. Term
This Agreement shall take effect on the Effective Date and shall continue in
force for a period of ten years, subject to the termination provisions described
in Article 12, below. At the expiration of such term, the parties may mutually
agree to renew this Agreement with such changes as may be warranted by changes
in circumstances during the initial ten year term.
Article 11. Modification of TK Business
(1) The Operator retains the right, within its sole discretion, to modify the
definition of the TK Business to exclude the IV Business. If the Operator
does not exercise such rights under this Article, the IV Business will
continue to be part of the definition of the TK Business.
(2) The Operator will not modify the definition of the TK Business to exclude
the IV Business for a period of twenty-one (21) months from the Effective
Date of this Agreement, except subject to the notice and modification fee
clauses described within this Article.
(3) If the Operator wishes to modify the definition of the TK Business to
exclude the IV Business, it must provide
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written notice to the Investor at least six months prior to the effective
date of such modification under this Article.
(4) If the Operator provides such notice such that the effective date of such
modification is within the period described in Clause 2 of this Article,
the Operator will pay to Investor a modification fee equal to the expected
allocation to Investor related to the IV Business for the remaining portion
of the twenty-one month period, based on an expected allocation of (Yen)
20,000,000 per month, which expected amount may not become fixed or
conclusive prior to the time of the exclusion of the IV Business, and may
be subject to any amendment through reasonable consultations between the
Operator and Investor.
(5) The expenses relating to the modification of the TK Business pursuant to
this Article will not be reflected in the financial statements of the
Tokumei Kumiai.
Article 12. Termination
(1) The Investor may terminate this Agreement in the event of any material
breach by the Operator of a term of this Agreement occurs which is not
rectified within 60 days after receipt by Operator of written notice of
breach from the Investor; provided, however, that if Operator disputes such
termination, this Agreement shall remain in full force and effect until
completion of the dispute resolution procedures in Article 21.
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(2) The Agreement shall terminate in the event either party 1) enters
bankruptcy, corporate reorganization or similar proceedings or 2) is
dissolved or liquidated, unless the relevant party assigns its rights and
obligations to another entity as permitted under the terms of Article 9.
(3) This Agreement shall terminate immediately prior to the disposition by the
Operator of any substantial portion of the CV Business outside of the
ordinary course of business, unless the Investor provides written consent
to an assignment of the Operator's rights and obligations under this
Agreement to the Purchaser pursuant to the terms of Article 9.
(4) The provisions of Article 10 of this Agreement notwithstanding, if Operator
shall provide notice in writing of a desire to terminate this Agreement at
any time prior to the tenth anniversary of the Effective Date, then this
Agreement shall be terminated on the date that falls six months following
the Investor's receipt of such notice.
(5) The provisions of Article 10 of this Agreement notwithstanding, this
Agreement may be terminated at any time by the written mutual agreement of
the parties specifying the effective date of such termination.
Article 13. Consequences of Expiration or Termination
(1) In the event of the expiration of this Agreement or the termination of this
Agreement pursuant to Article 10 or
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12 herein, the Operator shall (i) distribute to the Investor, within five
(5) days after such expiration or termination, cash in an amount equal to
the original Capital Contribution made pursuant to Article 4(1), and (ii)
provide to the Investor, within ninety (90) days after the date of such
expiration or termination, audited financial statements with respect to the
Tokumei Kumiai and a full and proper accounting of Profits, Losses and
Notional Yield as of the date of the expiration or the termination in
accordance with Article 8(4). Within five (5) days after the audited
financial statements are provided pursuant to the preceding sentence, (i)
the Operator shall distribute to the Investor the Investor's share of Net
Profits (excluding any and all unrealized appreciation or depreciation in
the value of the CV Business and the IV Business) and Notional Yield
accrued under the principles of Article 5(2) as of the date of such
expiration or termination and to the extent not previously distributed to
the Investor and/or (ii) the Investor shall pay to Operator any Net Losses
allocated to the Investor pursuant to this Agreement which have not been
followed by additional Capital Contributions, as prescribed in Article 4,
above. In no event shall the Investor acquire any right or interest in the
Property (including any appreciation in the value thereof) or in the CV
Business or the IV Business.
(2) If, at any time following the expiration or termination of this Agreement,
the Operator shall pay any liability
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arising from the operation of the TK Business during the term of this
Agreement (including, without limitation, contingent liabilities incurred
during the term of this Agreement) and that was not taken into account in
determining Net Profits and Net Losses hereunder, the Investor shall
reimburse the Operator for 90% of such amount within ten (10) business days
after receipt of notice thereof from the Operator.
(3) If, at any time following the expiration or termination of this Agreement,
the Operator shall receive any payment that results from the operation of
the TK Business (other than the one-time loan of cash to Affiliates of the
Operator) during the term of this Agreement (including, without limitation,
any reimbursement of liabilities pursuant to the Japan Distribution
Agreement) and that was not taken into account in determining Net Profits
and Net Losses hereunder, the Operator shall pay 90% of such amount to
Investor within ten (10) business days after Operator's receipt of such
payment.
(4) The provisions of Clauses (2) and (3) of this Article 13 shall survive the
expiration or termination of this Agreement.
Article 14. Notices
All notices, requests, demands or other communications that shall or may be
given hereunder shall be in writing in the
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English language and shall be deemed to have been duly given or made:
(a) at the time of delivery to a duly authorized person, if delivered by
hand;
(b) upon receipt, if made by letter, or
(c) if given by telefax when confirmed by telephone or return telefax.
Such notices, requests, demands or other communications shall be
dispatched to or given at:
If to Investor:
Xxxxxxx Lifesciences Finance Limited
0-0 Xxxxxxxxxx, Xxxxxxx-xx
Xxxxx, 000-0000 Xxxxx
Attention: President, Director
with a copy to:
Xxxxxxx Lifesciences Corporation
00000 Xxx Xxxx Xxxxxx
Xxxxxx, Xxxxxxxxxx 00000
XXX
Attention: International Counsel
Telefax: 000-000-0000
If to Operator:
Xxxxxx Limited
0, Xxxxxxxxxx, Xxxxxxx-xx
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Xxxxx 000-0000 Xxxxx
Attention: President
Telefax: 00-0-0000-0000
with a copy to:
Xxxxxx International Inc.
Xxx Xxxxxx Xxxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
XXX
Attention: International Counsel
Facsimile: 000-000-0000
or such other person, address or number as either party may designate in writing
to the other by a similar notice.
Article 15. Amendments
This Agreement may not be renewed, amended or modified in any manner, except by
an instrument in writing signed by an authorized representative of Investor and
the President of Operator.
Article 16. Waiver
The waiver, express or implied, by either of the parties hereto of any right
hereunder or of any failure to perform any term of this Agreement or breach
hereof by the other party hereto shall not constitute or be deemed a waiver of
any other right hereunder or of any other failure to perform any term of this
Agreement or breach hereof by such other party, whether of a similar or
dissimilar nature thereto.
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Article 17. Severability
Should any provision of this Agreement be held in whole or in part invalid or
unenforceable, such provision or part thereof shall be deemed deleted from this
Agreement and, to the extent not so held invalid or unenforceable, each
provision hereof shall remain in full force and effect. In the event any
provision deleted hereunder is deemed by either party to be a material provision
hereof, the parties shall negotiate in good faith a mutually acceptable
substitute provision that gives full effect to the spirit and intent of this
Agreement.
Article 18. Confidentiality
Neither the Operator nor the Investor may divulge the contents of this Agreement
or any information with respect to the operation of the Tokumei Kumiai or the
other party; provided that this restriction shall not apply in the event (i)
disclosure is requested by appropriate authorities pursuant to statutory
authority or (ii) either party determines, with the advice of counsel, that such
disclosure is required pursuant to applicable securities laws or regulations or
stock exchange requirements.
Article 19. Late Interest
In the event the Operator or the Investor shall be late in the payment of money
provided for in this Agreement, such party shall pay interest at the rate of 3%
over the then-effective Japanese long-term prime rate per annum in respect to
the relevant outstanding amount for the period from and
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including the date payment thereof was due until and including the date full
payment thereof is made.
Article 20. Governing Law
This Agreement shall be executed in the English language and shall be governed
by and construed in accordance with the laws of Japan.
Article 21. Dispute Resolution
(1) Any dispute arising out of or relating to this Agreement shall be resolved
in accordance with the procedures specified in this Article 21 which shall
be the sole and exclusive procedures for the resolution of any such
disputes.
(2) The parties will attempt in good faith to resolve expeditiously any
dispute, claim or controversy arising out of or relating to the execution,
interpretation and performance of this Agreement (including the validity,
scope and enforceability of this arbitration provision) promptly by
negotiations between executives who have authority to settle the
controversy and who are at a higher level of management than the persons
with direct responsibility for the administration of this Agreement. Either
party may give the other party written notice (an "Escalation Notice") of
any dispute not resolved in the normal course of business. Within fifteen
days after delivery of the Escalation Notice, the receiving party shall
submit to the other a written response. The Escalation Notice and the
response thereto shall include
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(a) a statement of each party's position and a summary of arguments
supporting that position, and (b) the name and title of the executive who
will represent that party and of any other person who will accompany the
executive. Within 30 days after delivery of the Escalation Notice, the
executives of both parties shall meet at a mutually acceptable time and
place, and thereafter as often as they reasonably deem necessary, to
attempt to resolve the dispute. All reasonable requests for information
made by one party to the other will be honored. All negotiations pursuant
to this clause are confidential and shall be treated as compromise and
settlement negotiations for purposes of applicable rules of evidence.
(3) Any dispute, claim or controversy arising out of or relating to this
Agreement or its breach, termination or validity which has not been
resolved by the specified non-binding procedure set forth in clause (2)
above within 90 days of the date of delivery of the Escalation Notice shall
be finally settled by arbitration in Tokyo pursuant to the Commercial
Arbitration Rules of the Japan Commercial Arbitration Association.
Article 22. Section Headings
The headings in this Agreement are inserted for convenience and identification
only, and are in no way intended to describe, interpret, define, or limit the
scope, extent, or intent of this Agreement or any provision thereof.
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Article 23. Copies
This Agreement shall be executed in two (2) original copies, with the Operator
and the Investor each retaining one original.
*****
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the date
first written above.
Xxxxxx Limited Xxxxxxx Lifesciences
Finance Limited
/s/ Xxxxx Xxxxxx Xxxxxx /s/ Xxxxx X. Xxxxxx
----------------------- -------------------
Name: Xxxxx Xxxxxx Xxxxxx Name: Xxxxx X. Xxxxxx
Title: President and Title: General Counsel
Representative Director
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Exhibit A
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CV Business
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The Cardiovascular Group sells or is engaged in the development of following
product categories in Japan through its three business units (Cardiovascular
Surgery, or CVS, Anesthesia and Medication Delivery, or AMD, and Vascular and
Interventional Cardiology, or VIC):
. Tissue and mechanical heart valves and rings, pericardial patches,
oxygenators, and cardiopulmonary bypass circuits including reservoirs and
arterial filters, cardioplegia devices, heart-lung machines, centrifugal
pumps, arterial and venous cannulae, CDI oxygen monitor cells, Novacor left
ventricular assist devices
. Thermo-dilution (Xxxx-Xxxx) catheters, pacing catheters, central venous
catheters, venous introducers, Invos cerebral tissue oxygen monitor devices,
VIA continuous arterial blood gas monitor devices, Lifespan PTFE endovascular
grafts, Xxxxxxx atraumatic occlusion clips and clamps, Intramed angioscopy
equipment, Thombex PMT clot extraction catheters
. Direct blood pressure monitor kit, disposable pressure transducers,
Embolectomy (Xxxxxxx) catheters, Lifepath abdominal aortic aneurysm
endovascular graft system, Datascope intra-aortic balloon pumps and
catheters, VasoSeal collagen hemostasis devices, UniCath percutaneous
transluminal coronary angioplasty balloon catheters and stents, Medtronic
pacemakers
The Cardiovascular Group in Japan also manufacturers Custom Pac cardiopulmonary
circuits and direct blood pressure monitor kits at the Miyazaki plant.
Exhibit B
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IV Business
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The IV Business consists of the importation and distribution of the products
that Operator currently sells or plans to sell in Japan in the following product
categories:
. Infusors, TUR solutions and sets, EIS infusion pumps and Interlink
products, epidural trays and Sabratek pumps,
together with any improved versions of such products introduced after date
hereof. For the avoidance of doubt, the IV Business shall not include any
products subsequently acquired by Operator or its Affiliates as a result of an
acquisition or similar transaction that closes after date hereof.
Exhibit C
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Financial Statements
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See attached.
