STOCK PURCHASE AGREEMENT
by and between
BAUSCH & LOMB INCORPORATED
and
CHIRON CORPORATION
Dated as of October 21, 1997
EXHIBITS
Exhibit A
Reserved
Exhibit B
Opinion of Xxxxxxx X. Xxxxx, Esq., Counsel
for Chiron
Exhibit C
Non-competition Agreement
Exhibit D
Opinion of Purchaser's Counsel
Exhibit E
List of Special Charges
SCHEDULES
Schedule
1.5.1
Audited Balance Sheet
Schedule
2.2
Noncontravention
Schedule
2.3
Governmental Consents or Approvals
Schedule
2.4.1
Subsidiaries of the Company
Schedule
2.5
Directors and Officers of the Company
Schedule
2.6.2
Capital Stock of the Company
Schedule
2.8
Undisclosed Liabilities
Schedule
2.9
Certain Developments of the Company
Schedule
2.10
Real Properties of the Company
Schedule
2.11.1
Contracts
Schedule
2.11.2
Certain Contracts
Schedule
2.11.3
Contract Approvals
Schedule
2.12
Litigation
Schedule
2.13.1
Intellectual Property
Schedule
2.13.2
Certain Intellectual Property Matters
Schedule
2.14
Permits
Schedule
2.15.1
Employee Benefit Plans and Agreements
Schedule
2.15.2
Benefit Arrangements
Schedule
2.16
Certain Interests
Schedule
2.17
Intercompany Transactions
Schedule
2.21
Insurance Policies and Bonds
Schedule
2.23
Certain FDA Matters
Schedule
3.2
Noncontravention
Schedule
3.3
Governmental Consents or Approvals
Schedule
4.2.1
Commitments and Capital Expenditures
Schedule
6.2.1
Tax Sharing Agreements
Schedule
6.2.2
Tax and Other Returns and Reports
STOCK PURCHASE AGREEMENT
THIS STOCK PURCHASE AGREEMENT dated as of October 21,
1997, is made by and between Bausch & Lomb Incorporated, a
New York corporation (the "Purchaser"), and Chiron
Corporation, a Delaware corporation ("Chiron").
RECITALS
A. Chiron owns 1,000 shares of Common Stock, $.01 par
value (the "Stock"), of Chiron Vision Corporation, a
Delaware corporation (the "Company"), constituting all of
the issued and outstanding capital stock of the Company.
B. The Purchaser desires to purchase the Stock, and
Chiron desires to sell the Stock to the Purchaser, on the
terms and conditions herein set forth.
NOW THEREFORE, in consideration of the premises and of
the respective representations, warranties, covenants and
conditions contained herein, the parties hereto agree as
follows:
ARTICLE I
Purchase and Sale
1.1 Purchase and Sale. Upon the terms and subject to
the conditions of this Agreement (this and other capitalized
terms, to the extent not defined in any other Article, shall
have the meanings assigned to such terms in Article X),
Chiron shall sell to the Purchaser, and the Purchaser shall
purchase from Chiron, the Stock at the Closing (as defined
in Section 1.4) and Chiron shall deliver at the Closing the
certificates evidencing the Stock, properly endorsed, or
accompanied by a duly executed stock power duly endorsed, in
blank.
1.2 Purchase Price. In consideration for the Stock
and as payment in full therefor, the Purchaser shall pay to
Chiron $300,000,000 (the "Purchase Price"), subject to
such adjustments as may be made pursuant to Section 1.5.
1.3 Payment of Purchase Price. If the obligations of
the parties to proceed with the Closing set forth in Article
VII are satisfied or waived in writing by all parties, at
the Closing, the Purchaser shall pay Chiron the Purchase
Price by wire transfer of immediately available funds to a
bank account designated by Chiron. Within two business days
of delivery to the Purchaser of the Closing Date Balance
Sheet, the Purchaser shall pay to Chiron, or Chiron shall
pay to the Purchaser, as the case may be, by wire transfer
of immediately available funds, the adjustment to the
Purchase Price, if any, determined in accordance with
Section 1.5.
1.4 Closing. The closing (the "Closing") of the
purchase and sale of the Stock shall take place at the
offices of the Purchaser's counsel in Newport Beach,
California as soon as possible after the satisfaction or
waiver of the conditions set forth in Article VII, or at
such other time and place as the parties shall mutually
agree; provided that in no event shall the Purchaser be
required to close prior to November 1, 1997. The date on
which the Closing actually occurs is herein referred to as
the "Closing Date."
1.5 Adjustments to Purchase Price.
1.5.1 Adjustment. The Purchase Price shall be
adjusted as follows:
(a) If the amount of Net Assets reflected on
the Closing Date Balance Sheet (as defined in Section
1.5.2(a)) (the "Closing Date Net Assets") is more
than $82,702,000 (being the amount of Net Assets
reflected on the Audited Balance Sheet, which is
attached as Schedule 1.5.1 and herein called the
"Audited Balance Sheet Date Net Assets"), there will
be an upward adjustment of the Purchase Price equal to
fifty percent of the difference between the Closing
Date Net Assets and the Audited Balance Sheet Net
Assets.
(b) If the Closing Date Net Assets are less
than the Audited Balance Sheet Date Net Assets, there
will be a downward adjustment of the Purchase Price
equal to fifty percent of the difference between the
Closing Date Net Assets and the Audited Balance Sheet
Net Assets.
(c) In the event Net Operating Losses of
Chiron Adatomed reported as of December 31, 1997 are
less than $1,000,000, there will be a downward
adjustment of the Purchase Price equal to forty percent
of the difference between $1,000,000 and such Net
Operating Losses.
(d) If any upward or downward adjustment is
required, the increase or decrease to the Purchase
price, as the case may be, shall be referred to herein
as the "Upward Purchase Price Adjustment" or
"Downward Purchase Price Adjustment", respectively.
1.5.2 Balance Sheet.
(a) Chiron shall, at its own cost and
expense, prepare and deliver to the Purchaser within 60
days after the Closing Date, a consolidated balance
sheet for the Company and its Subsidiaries (as defined
in Section 2.4.4) as of the Closing Date (the "Closing
Date Balance Sheet") which shall include, in addition
to the other information set forth therein, the Closing
Date Net Assets. The Closing Date Balance Sheet shall
be prepared in accordance with the Agreed Procedure,
and shall be accompanied by an audit opinion thereon of
KPMG Peat Marwick LLP ("KPMG") to the effect that the
Closing Date Balance Sheet, and the assets and
liabilities reflected thereon, were prepared and
determined in accordance with the Agreed Procedure.
The Closing Date Balance Sheet shall be accompanied by
a supplementary schedule setting forth the calculation
of the adjustment to the Purchase Price contemplated by
Section 1.5.1. During the sixty-day period following
the Closing, the Purchaser will cause the Company to
provide to Chiron and its accountants reasonable access
during normal business hours to such books and records
of the Company as may be necessary to enable Chiron to
prepare the Closing Date Balance Sheet. Chiron shall
make available to the Purchaser all work papers, books
and records used by it in the preparation and audit of
the Closing Date Balance Sheet, and shall provide
copies of the same. The Purchaser and such accountants
or auditors of its choice (the cost and expense of
which shall be borne by the Purchaser) shall be
entitled to jointly conduct with Chiron and KPMG, or
otherwise participate in or monitor, a physical count
of the inventories on hand as of the Closing Date (or
such other date as the Purchaser and Chiron shall
mutually agree) and such other procedures acceptable to
the Purchaser with respect to any inventory on
consignment.
(b) The Purchaser shall have 30 business
days after its receipt of the Closing Date Balance
Sheet and related supplementary schedules to review
them (the "Review Period"). On or prior to the
expiration of the Review Period, the Purchaser shall
notify Chiron in writing if it does not agree with
Chiron's calculation of any adjustment to the Purchase
Price (the "Disagreement Notice"), which notice shall
include a brief description of the basis of its
disagreement, including its calculation of any
adjustment to the Purchase Price. If Chiron does not
receive the Disagreement Notice on or prior to the
expiration of the Review Period, the Purchaser shall be
deemed to have approved the Closing Date Balance Sheet
and Chiron's calculation of any adjustment to the
Purchase Price applicable thereto.
(c) If Chiron receives the Disagreement
Notice, Chiron and the Purchaser shall, in good faith,
attempt to resolve the disagreement within 20 business
days after Chiron's receipt of the Disagreement Notice.
If they cannot resolve the disagreement within such
time period, then (i) Chiron or the Purchaser, as
applicable, shall promptly pay any net amount owed to
the other party that is not in disagreement (i.e., net
of any offsetting liability), and (ii) the parties
promptly shall refer such disagreement for resolution
to Xxxxxx Xxxxxxxx LLP, or if Xxxxxx Xxxxxxxx LLP is
unable to serve or declines to act, or if at the time
of such referral Xxxxxx Xxxxxxxx LLP is not independent
of each of the Purchaser and Chiron, such other firm of
independent accountants of recognized national standing
as mutually selected by the Purchaser and Chiron (such
firm being referred to herein as the "Deciding
Accountant"). The determination of the Deciding
Accountant as to the calculation and amount of any
adjustment to the Purchase Price shall be rendered
within 30 calendar days after such disagreement is
referred to the Deciding Accountant, and shall be
binding upon the parties hereto.
(d) Each of the Purchaser and Chiron shall
furnish to the Deciding Accountant, at its own cost and
expense, such documents and information as the Deciding
Accountant may request, and each party may also furnish
to the Deciding Accountant such other information and
documents as it deems relevant, in all cases with
copies (where it would not be unreasonably costly or
burdensome to provide copies) or notification (with
reasonable rights of access) being given to the other
party. The fees and expenses payable to the Deciding
Accountant shall be borne one-half by the Purchaser and
one-half by Chiron.
(e) The Closing Date Balance Sheet as agreed
to by the parties or as determined by the Deciding
Accountant, and the Closing Date Net Assets reflected
thereon, shall be binding on the parties and thereafter
be the "Closing Date Balance Sheet" and the "Closing
Date Net Assets", respectively, for all purposes of
this Agreement. The later of the date on which the
parties agree upon the Closing Date Balance Sheet and
the calculation of any adjustment to the Purchase Price
or the date on which the Deciding Accountant renders
its decision with respect thereto shall be called the
"Final Settlement Date".
(f) Within 10 business days after the Final
Settlement Date, (i) if the Purchase Price paid at the
Closing is to be increased, the Purchaser shall pay to
Chiron the Upward Purchase Price Adjustment to the
extent not previously paid via wire transfer to an
account of Chiron identified in writing by Chiron, and
(ii) if the Purchase Price paid at the Closing is to be
decreased, Chiron shall pay to the Purchaser the
Downward Purchase Price Adjustment to the extent not
previously paid via wire transfer to an account of the
Purchaser identified in writing by the Purchaser.
(g) Any adjustments to the Purchase Price
required by application of this Section 1.5 shall be
allocated among the Net Assets in the same manner as
the allocation of Purchase Price required by Section
6.9.
ARTICLE II
Representations and Warranties of Chiron
Chiron represents and warrants to the Purchaser that:
2.1 Organization and Authority of Chiron. Chiron is a
corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware. Chiron
has full power and authority to execute, deliver and perform
this Agreement and such other documents as are contemplated
hereunder to be executed and delivered at or prior to the
Closing. The execution, delivery and performance of this
Agreement by Chiron and the consummation of the transactions
contemplated hereby have been duly authorized by all
necessary corporate action on the part of Chiron, the
Company and the Subsidiaries. This Agreement constitutes a
valid and, assuming due execution by the Purchaser, and the
expiration or termination of the applicable waiting period
under the HSR Act (as defined in Section 2.3), binding
obligation of Chiron, enforceable against Chiron in
accordance with its terms, subject to applicable bankruptcy,
insolvency, moratorium, reorganization or similar laws
affecting creditors' rights generally, and to general
equitable principles.
2.2 Noncontravention. Except as set forth in Schedule
2.2, the execution, delivery and performance of this
Agreement by Chiron and the consummation of the transactions
contemplated hereby will not violate or conflict with, or
constitute a breach or default (whether upon lapse of time
and/or the occurrence of any act or event or otherwise)
under (a) the Certificate of Incorporation or bylaws of
Chiron, the Company or any of the Subsidiaries (as defined
in Section 2.4.4), or (b) any law, regulation, order,
judgment, or decree applicable to any such Person, or (c)
any material indenture, mortgage or other instrument to
which Chiron is a party or by which it or any of its
properties is bound.
2.3 No Governmental Consent or Approval Required. No
authorization, consent, Permit, approval or other order of,
declaration to, or registration, qualification, designation
or filing with, any governmental agency or body is required
for or in connection with the execution, delivery and
performance of this Agreement by Chiron and the consummation
of the transactions contemplated hereby by Chiron, the
Company and the Subsidiaries, other than (a) the filing of
notification under the Xxxx-Xxxxx-Xxxxxx Antitrust
Improvements Act of 1976 ("HSR Act") and the expiration or
early termination of the waiting period thereunder, as well
as certain filings under the foreign competition laws
(together with the HSR Act, the "Competition Laws"), and
(b) the matters identified in Schedule 2.3 as requiring that
certain actions be taken by or with respect to any
governmental agency or body and (c) any consents from any
Person (other than any governmental entity or body) the
failure to obtain which does not prohibit the transfer of
the Stock or the consummation of any of the transactions
contemplated hereby or create a Lien on the Stock.
2.4 Subsidiaries.
2.4.1 Capitalization, Qualification and. The
Company has no subsidiaries and no investments, directly or
indirectly, in any corporation or business organization
other than the subsidiaries and certain other investments
listed on Schedule 2.4.1. Schedule 2.4.1 correctly sets
forth the capitalization of each Subsidiary (as defined in
Section 2.4.4), the ownership of the Company or one of its
Subsidiaries therein, the jurisdictions in which the Company
and its Subsidiaries are organized and each jurisdiction in
which the Company and any of its Subsidiaries is required
(except where the failure to so qualify would not have an
adverse effect on the business, assets, financial condition
or results of operations of the Company or its Subsidiaries)
to be qualified or licensed to do business as a foreign
Person.
2.4.2 Chiron Adatomed. The Company currently
conducts certain business through an affiliate, Chiron
Adatomed Pharmazeutische und medizintechnicshe Gesellschaft
mbH ("Chiron Adatomed"). At the date of this Agreement,
all of the outstanding capital stock of Chiron Adatomed is
owned by Chiron. Chiron will transfer all such outstanding
capital stock to the Company prior to the Closing.
2.4.3 Chiron Canada. The Company currently
owns all of the outstanding capital stock of Chiron Vision
Canada Inc. ("Chiron Canada"), a Canadian corporation.
Prior to the Closing, all of the capital stock of Chiron
Canada will be transferred to Chiron. Chiron Canada is not
actively engaged in the business of the Company and its
Subsidiaries.
2.4.4 Definitions. As used in this Agreement,
the term "Subsidiaries" means the subsidiaries of the
Company listed on Schedule 2.4.1 and includes Chiron
Adatomed.
2.5 Organization and Authority of the Company and
Subsidiaries. Except as set forth on Schedule 2.5, the
Company and each Subsidiary is a corporation duly organized,
validly existing and in good standing under the laws of its
jurisdiction of incorporation and has all corporate power
and authority to carry on its business as presently
conducted and to consummate the transactions contemplated
hereby. Except as set forth on Schedule 2.5, the Company
and each Subsidiary is qualified to do business as a foreign
corporation in good standing in each jurisdiction where
failure to so qualify would have an adverse effect on the
business, assets, financial condition or results of
operations of the Company or any Subsidiary. Schedule 2.5
correctly lists the current directors and executive officers
of the Company and the Subsidiaries. True, correct and
complete copies of the respective charter documents of the
Company and the Subsidiaries as in effect on the date hereof
have been provided to the Purchaser.
2.6 Capitalization.
2.6.1 The Company. The entire authorized
capital stock of the Company consists of 1,000 shares of
Common Stock, $.01 par value, of which 1,000 shares are
issued and outstanding. All of the Stock has been duly
authorized and validly issued and is outstanding, fully paid
and nonassessable. There are no outstanding warrants,
options, subscription, conversion, preemptive or other
rights entitling any person or entity to purchase or
otherwise acquire any capital stock of the Company. Chiron
owns all of the Stock beneficially and of record and has
good and valid title to all of the Stock, free and clear of
all Liens and, subject to applicable securities laws and
competition laws, free of any restriction on its right to
transfer or exercise any voting or other right with respect
thereto. At the Closing, the Purchaser will acquire good
and valid title to the Stock, free and clear of any Liens of
any nature whatsoever.
2.6.2 The Subsidiaries. Except as disclosed
in Schedule 2.6.2, the Company owns all of the capital stock
of each Subsidiary beneficially and of record and has good
and valid title to all of the capital stock of each
Subsidiary, free and clear of all Liens and, subject to
applicable securities laws and competition laws, free of any
restriction on its right to transfer or exercise any voting
or other right with respect thereto and all of such shares
of capital stock have been duly authorized and, to the
extent applicable in the jurisdiction in which such
Subsidiary was organized, are validly issued and
outstanding, fully paid and non-assessable and, at the
Closing, upon the consummation of the transactions
contemplated hereby, the Company will continue to have good
and valid title to all such shares of capital stock, free
and clear of any Liens of any nature whatsoever. Except as
disclosed on Schedule 2.6.2, there are no outstanding
warrants, options, subscription, conversion, preemptive or
other rights entitling any Person to purchase or otherwise
acquire any capital stock of the Company or any Subsidiary.
Any capital stock or other securities or equity interests of
the Company or any Subsidiary which were issued and
reacquired by the Company or any of such Subsidiaries were
so reacquired (and, if reissued, so reissued) in compliance
with all applicable laws, and neither the Company nor any
Subsidiary has any outstanding obligation or liability with
respect thereto.
2.7 Financial Statements. Chiron has delivered to the
Purchaser (a) the consolidated balance sheets of the Company
and Subsidiaries as of December 31, 1996 (the "Audited
Balance Sheet") and the consolidated statements of
operations and cash flows for the year ended December 31,
1996, accompanied by the audit report thereon of KPMG (the
"Audited Financial Statements"), (b) the unaudited
consolidated balance sheet of the Company and Subsidiaries
as of March 31, 1997 (the "Q-1 Balance Sheet") and the
unaudited consolidated statements of operations for the
three months then ended (together with the Audited Financial
Statements, the "Financial Statements"). The Financial
Statements have been prepared in accordance with GAAP,
consistently applied, and fairly and accurately present the
financial position of the Company and the Subsidiaries as of
the respective dates thereof and the results of operations
and changes in financial position and, in the case of the
Audited Financial Statements, cash flow of the Company and
Subsidiaries for the respective periods covered thereby. At
the date of such balance sheets, neither the Company nor the
Subsidiaries had any liability (actual, contingent, accrued
or otherwise) that, in accordance with GAAP applied on a
consistent basis, should have been shown or reflected
therein but was not. Since December 31, 1995, there has been
no change in any of the significant accounting policies,
practices or procedures of the Company or any Subsidiary.
2.8 Undisclosed Liabilities. The Company and its
Subsidiaries have no liabilities (whether accrued, absolute,
contingent or otherwise, and whether due or to become due,
probable of assertion or not), except for (a) matters
identified in Schedule 2.8, (b) liabilities fully reflected
and expressly reserved for in the Audited Balance Sheet, (c)
liabilities of a type not required to be reflected in the
Company's or its Subsidiaries' balance sheet in accordance
with GAAP, and (d) liabilities incurred in the ordinary
course of business since December 31, 1996.
2.9 Absence of Certain Developments. Since December
31, 1996, except as disclosed in the Financial Statements or
in Schedule 2.9, there has not been (a) any declaration,
setting aside or payment of any dividend or other
distribution with respect to the capital stock of the
Company, (b) any loss, destruction or damage to any property
of the Company or its Subsidiaries, whether or not insured,
which had or could reasonably be expected to have an adverse
effect on the business, assets, financial condition, or
results of operations of the Company and any Subsidiary, or
(c) any agreement, condition, action or omission which would
be prescribed by (or requires notice or consent under)
clause (b), (c), (d) or (g) of Section 4.2 had it existed,
occurred, or arisen after the date of this Agreement.
2.10 Title to Properties.
2.10.1 Personal Property. Except as disclosed
in the Audited Financial Statements, the Company and
Subsidiaries have good and marketable title to, or have a
valid leasehold interest in, all of the personal properties
and assets held, occupied or used in their respective
businesses or otherwise purportedly owned or leased by the
Company or any Subsidiary, free and clear of all Liens other
than (a) the lien of current taxes not yet due and payable,
and (b) Permitted Liens. All such personal properties and
assets which are material tangible properties are adequate
for the respective businesses of the Company and its
Subsidiaries as presently conducted.
2.10.2 Real Property. Schedule 2.10 discloses
and lists all real properties currently owned, used or
leased by the Company or the Subsidiaries or in which the
Company or a Subsidiary has an ownership or leasehold
interest (collectively, the "Real Property") and if owned
identifies the record title holder of all of the Real
Property. Either the Company or a Subsidiary has good and
marketable fee simple title to (or a leasehold interest in,
as the case may be) all Real Property shown as owned (or
leased, if applicable) by it on Schedule 2.10, free and
clear of all Liens other than Permitted Liens. Neither the
Company nor any Subsidiary has received any written notice
of assessments for public improvements or condemnation
against any Real Property.
2.11 Contracts. Attached as Schedule 2.11.1 is a true
and complete list of all debt instruments, contracts,
leases, license agreements, employment and labor agreements,
and other agreements, commitments and understandings of any
kind, whether or not in writing, to which the Company or any
Subsidiary is a party or to which the Company, any
Subsidiary or any of their respective properties is subject
or by which any thereof is bound which is either (a)
important to the continued conduct of the business of the
Company and any Subsidiary as presently conducted or (b)
which pursuant to its terms imposes payment obligations on
either party in excess of $1 million annually or $3 million
in the aggregate (excluding all purchase orders, sales in
the ordinary course of business and distributorship
contracts that are not material to the business) ("Material
Contracts"). Except as disclosed in Schedule 2.11.2, each
Material Contract is in full force and effect; and no breach
or default, breach or default alleged in writing, or event
which would (with the passage of time, notice or both)
constitute a breach or default thereunder by the Company or
such Subsidiary, as the case may be, in each case in any
material respect, or, to the knowledge of Chiron, the
Company and each Subsidiary, any other party or obligor with
respect thereto exists and is continuing. The execution,
delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will
not result in a breach of or default under any Material
Contract, will not (and will not give any Person a right to)
terminate or modify any rights of, or accelerate or augment
any obligation of, the Company or any Subsidiary, and do not
require any consent, approval, waiver or other action by any
party to any such Material Contract, other than the consents
and approvals identified in Schedule 2.11.3 (the "Contract
Approvals").
2.12 Litigation. To the knowledge of Chiron, the
Company and each Subsidiary except as disclosed in Schedule
2.12, there is no written claim, filed complaint,
arbitration, action, suit, proceeding or investigation
pending or threatened, against, affecting or reasonably
expected to affect the Company or any Subsidiary, including
any claim for indemnification from the Company or a
Subsidiary which could reasonably be expected to be asserted
by any director, officer, employee, agent or representative
of the Company or any Subsidiary (a) which if resolved
adversely to the Company or any Subsidiary, as the case may
be, would result in liability to the Company or any
Subsidiary, or (b) seeking to prevent or challenging in any
other manner the consummation of the transactions
contemplated hereby. Neither the Company nor any Subsidiary
is a party to, or subject to the provisions of, or, to the
knowledge of Chiron, the Company and each Subsidiary, is
threatened with, any order, writ, injunction, judgment or
decree of any court or governmental agency or
instrumentality which could reasonably be expected to
prevent the consummation of the transactions contemplated
hereby. There is no organized labor strike, dispute,
slowdown or stoppage, or collective bargaining or unfair
labor practice claim pending, or to the knowledge of Chiron,
the Company and each Subsidiary threatened, against or
affecting the Company or any Subsidiary, nor are there, to
the knowledge of Chiron, the Company or any Subsidiary, any
union organizing efforts.
2.13 Intellectual Property.
2.13.1 Patents, Trademarks. Attached as
Schedule 2.13.1 is a list of all registered trademarks,
trademark applications, trade names, service marks, patents
and patent applications owned by the Company or any
Subsidiaries. Schedule 2.13.1 includes as to each item
listed thereon a registration or application number (as
applicable). Except as disclosed in Schedule 2.13.1, the
Company or a Subsidiary, as the case may be, has the sole
and exclusive rights to such registered trademarks,
trademark applications, trade names, service marks, patents
and patent applications and, to the knowledge of Chiron, the
Company and each Subsidiary, no other party has asserted
orally or in writing to the Company or any Subsidiary any
claim with respect to or challenged the Company's or
Subsidiary's rights with respect to such registered
trademarks, trademark applications, trade names, service
marks, patents and patent applications and such registered
trademarks, trademark applications, trade names, service
marks, patents and patent applications are free and clear of
any Liens other than Permitted Liens. Except as disclosed
in Schedule 2.13.1, to the knowledge of Chiron, the Company
and each Subsidiary, the Company or the Subsidiaries have
ownership of or license to all of the registered trademarks,
trademark applications, trade names, service marks, patents
and patent applications used in connection with the business
of the Company and the Subsidiaries, the absence of which
would have a material adverse effect on the Company and any
Subsidiary as presently conducted.
2.13.2 No Infringement. Except as disclosed in
Schedule 2.13.2, since January 1, 1993, the Company has not
received any written (or, to the knowledge of Chiron, the
Company or any of its Subsidiaries, oral) communications
alleging that the Company or any of its Subsidiaries has
infringed, violated or misappropriated any of the registered
trademarks, trademark applications, trade names, services
marks, patents, patent applications, copyrights or trade
secrets of any other Person. Except as disclosed on
Schedule 2.13.2, there are no third party patents which
could reasonably be expected to provide such third party
with a colorable claim against the Company or any Subsidiary
for infringement thereof based on acts of Chiron, the
Company or any Subsidiary occurring prior to the Closing
Date.
2.14 Compliance with Law; Governmental Permits. Except
as set forth in Schedule 2.14, to the knowledge of Chiron,
the Company and each Subsidiary (including, without
limitation, the Vice President of Regulatory Affairs for the
Company), the Company and each Subsidiary is in compliance
with all laws, regulations, orders, judgments and decrees of
any court or governmental authority which are applicable to
its business, including without limitation the Federal Food,
Drug and Cosmetic Act (the "FDC Act") and the regulations
promulgated thereunder, except in the case of the FDC ACT
and the regulations promulgated thereunder, noncompliance
with which could not reasonably be expected to result in any
enforcement action by any government entity or body or the
issuance of a warning letter by the U.S. Food and Drug
Administration (the "FDA"). Except as disclosed in
Schedule 2.14, to the knowledge of Chiron, the Company and
each Subsidiary, each Permit held by the Company and its
Subsidiaries is in full force and effect and will be upon
consummation of the transactions contemplated by this
Agreement. To the knowledge of Chiron, no suspension,
cancellation or termination of any of such Permits is
threatened or imminent.
2.15 Employee Benefits.
2.15.1 Plans and Material Documents.
(a) Schedule 2.15.1 lists all employee
benefit plans and severance plans generally applicable
to the U.S. employees of the Company or any of its
Subsidiaries, including, without limitation, (i) any
"employee welfare benefit plan" or "employee pension
benefit plan" (within the meaning of Sections 3(1) or
3(2) of ERISA) (the "Benefit Plans"), (ii) any profit
sharing, deferred compensation, bonus, stock option,
stock purchase, pension, retention, consulting,
retirement, severance, welfare or incentive plan, (iii)
any plan providing for fringe benefits or perquisites
to employees, officers, directors or agents, or (iv)
any employment agreement not terminable on 30 days (or
less) written notice and providing for an annual salary
in excess of $150,000. The plans described in this
Section 2.15.1 may be referred to herein as the
"Benefit Arrangements". Except as disclosed in
Schedule 2.15.1, none of the Benefit Arrangements or
any Benefit Plan or any employee pension benefit plan
(within the meaning of Section 3(2) of ERISA)
maintained or contributed to by any ERISA Affiliate is
(A) a plan subject to Title IV of ERISA or (B) a
"multiemployer plan" (within the meaning of Section
3(37) of ERISA). In addition, neither the Company nor
any of its ERISA Affiliates contributes to or had an
obligation to contribute to any multiemployer plan
during the five year period preceding the date of this
Agreement. Chiron has provided to the Purchaser true
and complete copies of all written documents and
summary plan descriptions of the Benefit Arrangements
made available to employees of the Company or any
Subsidiary. Chiron has provided to the Purchaser true
and complete copies of the Form 5500 filed in the most
recent plan year with respect to any Benefit Plan,
including all schedules thereto and financial
statements with attached opinions of independent
accountants.
(b) Except as disclosed on Schedule 2.15.1
or as required by Section 4980B of the Code, neither
the Company nor any Subsidiary has made any promises or
commitments to provide, and is under no obligation or
liability to provide, (i) medical benefits (including
through insurance) generally applicable to U.S.
retirees or former U.S. employees or their dependents
or (ii) life insurance or other death benefits
(including through insurance) generally applicable to
retired U.S. employees or their dependents.
2.15.2 Compliance with Applicable Law.
(a) Each Benefit Plan that is intended to be
qualified under Section 401(a) of the Code has received
a favorable determination letter from the Internal
Revenue Service that such Benefit Plan is qualified
under Section 401(a) of the Code (as amended by the Tax
Reform Act of 1986 and subsequent legislation prior to
1994) and that the trust under such Benefit Plan is
exempt from tax under Section 501(a) of the Code. To
the knowledge of Chiron, no event has occurred that is
likely to give rise to disqualification or loss of tax-
exempt status of any such Benefit Plan under Sections
401(a) or 501(a) of the Code. No "prohibited
transaction" (within the meaning of Section 4975 of
the Code or Sections 406 and 408 of ERISA) has occurred
with respect to any of such Benefit Plans that,
assuming the taxable period of such transaction expired
as of the date hereof, could subject the Company or any
of its Subsidiaries to a tax or penalty imposed by
either Section 4975 of the Code or Section 502(i) of
ERISA. Chiron has delivered to the Purchaser the most
recent determination letter received from the Internal
Revenue Service with respect to each such Benefit Plan.
(b) All contributions (including all
employer contributions and employee salary reduction
contributions) which are due have been paid to each
Benefit Plan.
(c) All Benefit Plans are in substantial
compliance in form and in operation with the relevant
provisions of ERISA and the Code, the regulations and
published authorities thereunder, and all other laws
applicable with respect to all such Benefit Plans. The
Company and its Subsidiaries have performed their
obligations under all Benefit Arrangements in all
material respects. There is no action (other than
routine claims for benefits) pending or to the
knowledge of Chiron and the Company threatened against
any Benefit Arrangement or arising out of any Benefit
Arrangement.
(d) Except as disclosed in Schedule 2.15.2
(which shall identify the entity obligated to make any
payments due or which may become due), the execution
and performance of this Agreement will not (i)
constitute a stated triggering event under any Benefit
Arrangement that will result in any payment (whether of
severance pay or otherwise) becoming due from Chiron,
the Company or any Subsidiaries to any present or
former officer, employee, director or consultant (or
dependents of any thereof) of the Company or any of its
Subsidiaries, or (ii) accelerate the time of, or upon
any act or event, or the lapse of time or both, result
in any payment or vesting, or increase the amount, of
compensation due to any employee, officer, director or
consultant of the Company or any Subsidiaries under any
Benefit Arrangements.
(e) To the knowledge of Chiron and the
Company, except as set forth on Schedule 2.15.2, all
Benefit Plans and Benefit Arrangements maintained for
foreign employees are in compliance in all material
respects in form and in operation with all laws
applicable to such Benefit Arrangements.
2.16 Certain Interests. Except as set forth in
Schedule 2.16, no officer or director of Chiron, the Company
or any Subsidiary is indebted or otherwise obligated to the
Company or any Subsidiary; and neither the Company nor any
Subsidiary is indebted or otherwise obligated to any such
officer or director, except for amounts due under normal
arrangements applicable to all employees generally as to
salary or reimbursement of ordinary business expenses.
2.17 Intercompany Transactions. Except as described in
Schedule 2.17, none of the goods and services provided by
Chiron or any Affiliate of Chiron (other than the Company
and the Subsidiaries) to the Company or any of its
Subsidiaries described in Schedule 2.17 is required or
necessary for the ongoing operation of the Company or any of
its Subsidiaries. Except as described in Schedule 2.17,
neither the Company nor any Subsidiary has any liabilities
or obligations to Chiron or any other Affiliate of Chiron
(other than the Company and the Subsidiaries) and none of
Chiron or such Affiliates has any obligations to the Company
or any Subsidiary. Except as described in Schedule 2.17,
consummation of the transactions contemplated by this
Agreement will not (either alone, or upon the occurrence of
any act or event, or with the lapse of time, or both) result
in any payment arising or becoming due from the Company or
any Subsidiary or the successor or assign of any thereof to
Chiron or any Affiliate of Chiron.
2.18 No Brokers or Finders. No agent, broker, finder,
or investment or commercial banker (other than Xxxxxx
Xxxxxxx, Xxxx Xxxxxx & Co., as to whose fees and expenses
Chiron shall have full responsibility and neither the
Company nor any Subsidiary nor the Purchaser shall have any
responsibility) or other Person or firm engaged by or acting
on behalf of Chiron, Company or any Subsidiary or any of
their respective Affiliates in connection with the
negotiation, execution or performance of this Agreement or
the transactions contemplated by this Agreement, is or will
be entitled to any brokerage or finder's or similar fee or
other commission as a result of this Agreement or such
transaction.
2.19 Inventories. As of the Closing Date, the
inventory as set forth on the Closing Date Balance Sheet is
acquired and maintained in accordance with the regular
business practices of the Company and the Subsidiaries,
consists of new, unused and reconditioned items of a quality
and quantity usable or saleable in the ordinary course of
business, and is valued at reasonable amounts in accordance
with GAAP and consistent with GAAP and consistent with the
normal valuation policy of the Company. As of the Closing
Date, none of such inventory is obsolete, unusable, damaged
or unsalable in the ordinary course of business, except for
such items of inventory which have been written down to
realizable market value, or for which adequate reserves have
been provided, in the Closing Date Balance Sheet.
2.20 Receivables. As of the Closing Date, the accounts
receivable set forth on the Closing Date Balance Sheet
represent bona fide claims of the Company or the
Subsidiaries against customers for sales, services performed
or other charges arising on or before the date thereof. As
of the Closing Date, said accounts receivable are subject to
no defenses, counterclaims or rights of setoff, except to
the extent of the appropriate reserves for bad debts on
accounts receivable as set forth on the Closing Date Balance
Sheet.
2.21 Insurance. Attached as Schedule 2.21 is a list of
(a) all insurance policies and bonds provided by third
parties currently maintained by or on behalf of the Company
and its Subsidiaries or which were maintained by or on
behalf of the Company and its Subsidiaries during the past
two years and (b) any third party indemnities relating to
the Company or its Subsidiaries under which Chiron, the
Company or any Subsidiary is receiving currently any
payments. Neither the Company nor any Subsidiary is in
default under any such policy or bond, nor is Chiron or
Centaur in default under any such policy or bond, where such
default would provide any insurer with a defense to its
obligation to provide coverage or otherwise be likely to
interfere with such coverage. Except as disclosed on
Schedule 2.21, to the knowledge of Chiron, the Company and
the Subsidiaries, Chiron, Centaur, the Company or the
Subsidiaries, as the case may be, have timely filed claims
with, and given notice to, the applicable insurers with
respect to all written claims for which the Company and its
Subsidiaries or Chiron or Centaur (where the Company or its
Subsidiaries would be indirect beneficiaries under such
policies maintained by Chiron or Centaur consistent with
past practice) may reasonably be expected to have coverage.
Except as disclosed on Schedule 2.12, claims have been filed
with insurers with respect to each matter identified on
Schedule 2.12 and such claims are covered by the applicable
insurance policies of such insurers, subject to the
applicable deductible or self-insured retention amounts
under the policies of such insurers (excluding Centaur).
Except as disclosed on Schedule 2.21, the execution,
delivery and performance of this Agreement will not
constitute a breach or default of any such policies, bonds
or third party indemnities which would result in a
termination of existing coverage for any claims for which
notice was properly given prior to Closing, or in the case
of third party indemnities, loss of the right to receive
coverage following the Closing.
2.22 Chiron Canada. As of the Closing Date, Chiron
Canada has no assets related to or connected with the
business of the Company or any Subsidiary as presently
conducted.
2.23 Certain FDA Matters. Except as disclosed in
Schedule 2.23, there have been no product recalls or market
withdrawals by the Company or any Subsidiary since December
31, 1995.
2.24 Completeness. To the knowledge of Chiron, the
Company or any Subsidiary, the Schedules to Article II
attached hereto do not contain any untrue statement of a
material fact or omit to state any material fact required to
be stated therein or necessary in order to make the
statements therein, in light of the circumstances under
which they were made, not misleading.
ARTICLE III
Representations and Warranties of the Purchaser
The Purchaser hereby represents and warrants to Chiron
that:
3.1 Organization and Authority. The Purchaser is a
corporation duly organized, validly existing and in good
standing under the laws of the State of New York. The
Purchaser has full power and authority to execute, deliver
and perform this Agreement. The execution, delivery and
performance of this Agreement by the Purchaser and the
consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate action on
the part of the Purchaser. This Agreement constitutes a
valid and, assuming due execution by Chiron, and the
expiration or termination of the applicable waiting period
under the HSR Act, binding obligation of the Purchaser,
enforceable against the Purchaser in accordance with its
terms, subject to applicable bankruptcy, insolvency,
moratorium, reorganization or similar laws affecting
creditors' rights generally and to general equitable
principles.
3.2 Noncontravention. The execution, delivery and
performance of this Agreement by the Purchaser and the
consummation of the transactions contemplated hereby will
not violate or conflict with, or constitute a breach or
default (whether upon lapse of time and/or the occurrence of
any act or event or otherwise) under (a) the certificate of
incorporation or bylaws of the Purchaser, (b) any law,
regulation, order, judgment, or decree applicable to the
Purchaser or (c) any contract, indenture, mortgage or other
instrument to which the Purchaser is a party that is
material to the financial condition or results of operations
of the Purchaser; subject (as to clauses (b) and (c)
respectively) to the matters disclosed on Schedule 3.2.
3.3 No Governmental Consent or Approval Required. No
authorization, consent, approval or other order of,
declaration to, or registration, qualification, designation
or filing with, any governmental entity or body or any other
Person is required for or in connection with the execution,
delivery and performance of this Agreement by the Purchaser
and the consummation of the transactions contemplated
hereby, other than (a) the filing of notification under the
HSR Act and the expiration or early termination of the
waiting period thereunder as well as certain filings under
Competition Laws and (b) the matters identified in Schedule
3.3 as requiring that certain actions to be taken by or with
respect to any governmental entity or body or any other
Person.
3.4 Purchase for Investment. The Purchaser is
purchasing the Stock for investment for its own account and
not with a view to, or for sale in connection with, the
distribution thereof.
ARTICLE IV
Covenants of Chiron
4.1 Cooperation and Access. From and after the date
hereof, Chiron shall cause the Company and each Subsidiary
to afford promptly to employees of the Purchaser with
responsibility for a particular subject area or subject
matter, to the Purchaser's management personnel and to its
authorized representatives (which term shall include its
independent accountants and counsel) at all reasonable times
with reasonable prior notice full and unrestricted access to
the premises, facilities, properties, books, records,
lawsuit pleadings, work papers and personnel of the Company
and each Subsidiary, to furnish to the Purchaser copies of
such books, records, working papers and such other
additional financial, tax, legal, and operating data and
information as the Purchaser may reasonably request and to
permit the Purchaser and its authorized representatives to
discuss the business and operations of the Company and its
Subsidiaries with the officers, employees with
responsibility for a particular subject area or subject
matter, accountants and counsel of the Company and its
Subsidiaries in order to assist the Purchaser in its
evaluation of the business; provided, however, that the
Purchaser shall not interfere with the normal operation of
the business of the Company and its Subsidiaries and Chiron
shall have the right to participate in all discussions with
the accountants and counsel of the Company and its
Subsidiaries. To the extent Chiron incurs more than $50,000
in the aggregate of fees and expenses to its outside
accountants and counsel who participate in such discussions
with the Purchaser or its representatives, the Purchaser
will reimburse Chiron for the amount of such fees and
expenses that exceed $50,000, against receipt of invoices of
such accountants and counsel.
4.2 Conduct of Business.
4.2.1 Pre-Closing Negative Covenants. From
the date hereof until the Closing, without the prior written
consent of the Purchaser, which shall not be unreasonably
withheld, Chiron will not permit the Company or any
Subsidiary to:
(a) enter into, amend in any material
respect or terminate any Material Contract except in
the ordinary course of business consistent with past
practice;
(b) issue or transfer any capital stock of
the Company or any Subsidiary or any security
convertible into or exchangeable for any such capital
stock or any right to acquire any such capital stock,
except as expressly provided in Section 2.4;
(c) merge or consolidate with any entity
except as provided in Section 2.4 or acquire any stock
or other ownership interests in any entity or the
assets of any business substantially as an entirety,
except as disclosed in Schedule 4.2.1;
(d) make any change in its certificate of
incorporation or bylaws (or equivalent governing
instruments);
(e) sell, lease, pledge, encumber or
otherwise dispose of or transfer any of its assets or
property, except in the ordinary course of business
consistent with past practice;
(f) incur any third party indebtedness other
than ordinary course trade debt consistent with past
practice or, except as set forth on Schedule 4.2.1,
enter into any commitment or make any capital
expenditures or investments of more than $200,000 alone
or $1,000,000 in the aggregate other than as set forth
in the 1997 capital budget of the Company or as
required by existing contractual obligations;
(g) liquidate, dissolve or otherwise
reorganize or seek protection from creditors, except as
disclosed in Schedule 4.2.1;
(h) except in the ordinary course of
business, settle any claim, dispute or litigation in
consideration for anything other than payment of
monies;
(i) conduct their respective business other
than in the ordinary course, consistent with past
practice;
(j) terminate or fail to renew any insurance
coverage;
(k) grant any general or uniform increase in
the pay or benefits of employees, or any increase in
the pay, bonus or benefits of any individual employee
earning $50,000 or more in annual salary (including
bonus) other than in the ordinary course of business as
disclosed in Schedule 4.2.1 or as otherwise disclosed
on Schedule 4.2.1;
(l) enter into any employment contract that
is not terminable at will and without payment (other
than the payment of customary severance in accordance
with the Company's policies); or
(m) agree or commit itself to do any of the
foregoing.
4.2.2 Pre-Closing Affirmative. Prior to the
Closing, Chiron shall, and shall cause the Company and each
Subsidiary to, use commercially reasonable efforts to
preserve intact its business and the goodwill of its
customers, suppliers, employees, and others having business
relations with it.
4.3 Government Approvals. Chiron will, and will cause
the Company and the Subsidiaries, to prepare and file, at
the earliest practicable date, all applications and other
notices required in connection with, and will use its
commercially reasonable effort to obtain promptly , all
consents, approvals or other actions by any governmental
agency or authority required to be obtained by Chiron, the
Company or any Subsidiary in connection with the performance
of this Agreement and the consummation of the transactions
contemplated hereby, including, without limitation, promptly
prepare and file notification in accordance with the HSR Act
and other Competition Laws. Chiron will notify the
Purchaser of all requests, terms or conditions made or
sought to be imposed on the Company or any Subsidiary in
connection with obtaining such approvals and will discuss
with the Purchaser the acceptability of such requests, and
Chiron and the Purchaser will mutually agree on the response
to such requests.
4.4 Consents. Chiron will cause the Company and its
Subsidiaries to use commercially reasonable efforts to
obtain, at the earliest practicable date, the Contract
Approvals.
4.5 Material Developments, Reports, Etc.
4.5.1 Events or Occurrences. Chiron shall
promptly notify the Purchaser of any event which, to the
knowledge of Chiron, the Company or any of the Subsidiaries,
has had or might reasonably be expected to have a material
adverse effect on the assets, properties, condition
(financial or otherwise), results of operations or the
business of the Company or any of its Subsidiaries taken as
a whole.
4.5.2 Reports. Chiron shall deliver to the
Purchaser promptly after they become available the
operating and financial reports to the extent customarily
prepared (including projections and budgets) of the Company
and its Subsidiaries that are prepared for management of the
Company or Chiron and monthly and quarterly unaudited
balance sheets, statements of operation for the Company and
its consolidated Subsidiaries.
4.6 Intercompany Accounts. Prior to the Closing,
Chiron shall (a) cause to be eliminated any and all loans,
advances and other extensions of credit made between the
Company or any Subsidiary on the one hand, and Chiron and
any of its Affiliates (other than the Company or any
Subsidiary), and (b) cause to be transferred to it all cash
and cash equivalents of the Company and the Subsidiaries.
4.7 Claremont Property. On or before the Closing, the
Claremont Property will be transferred to Chiron by
quitclaim deed with no representations and warranties by the
Company. Following the Closing and until the third
anniversary date of the Closing, the Purchaser and the
Company shall have the right to occupy and use the currently
occupied portion of the Claremont Property exclusively and
on a rent-free basis, whether or not the Claremont Property
is sold to a third party.
4.8 Assignment of Leases. On or before the Closing,
at Chiron's option, the Huntington Lease and the Xxxxxx
Keynes Lease, together with all obligations of the Company
thereunder as lessee, will be assigned to Chiron pursuant to
the terms of an assignment and assumption agreement
reasonably acceptable as to form by the Purchaser or Chiron
will indemnify the Purchaser from such obligations.
4.9 No Solicitation. Chiron agrees that it will not,
nor will it permit the Company or its Subsidiaries to, nor
will it authorize any stockholder, officer, director,
employee of, or any investment banker, attorney or other
advisor or representative of, Chiron, the Company or its
Subsidiaries to, solicit or initiate or encourage the
submission of any proposal to acquire the Company or its
business; provided that nothing herein shall preclude
Chiron, the Company or its Subsidiaries from continuing
discussions and exchange of information with potential
purchasers who have indicated an interest prior to the date
hereof.
4.10 Payroll and Other Services. Following the
Closing, Chiron shall provide the Purchaser, for the benefit
of the Company, with such employee payroll, other employee-
related processing services, human resource and computer
services and laser servicing in Canada as were provided to
the Company prior to the Closing, but only as are reasonably
required by the Purchaser during the period that the
Purchaser is diligently pursuing the transition of the
employees of the Company over to its own services up to a
maximum of six months. Such services shall be provided at a
rate equal to Chiron's fully burdened cost plus 10%. At or
prior to the Closing, (a) Chiron and the Company will enter
into a co-promotion agreement in form and substance
reasonably satisfactory to the Purchaser to promote
Vitrasert through Chiron's Therapeutics Group for a period
of three years on reasonable terms and conditions, and (b)
Chiron shall cause Chiron B.V. to enter into an agreement in
form and substance reasonably satisfactory to the Purchaser
with the Company on reasonable terms and conditions under
which Chiron B.V. will, for a period of two years, provide
Vitrasert testing services ("Vitrasert Testing") to the
Company. The Purchaser shall agree to indemnify, defend and
hold harmless Chiron and its Affiliates from and against any
and all Losses arising out of or attributable to the
provision of all services provided under Section 4.10, other
than the co-promotion of Vitrasert. Chiron shall agree to
indemnify, defend and hold harmless the Purchaser, the
Company and their Affiliates from and against any and all
Losses arising out of or attributable to the negligence of
Chiron B.V. in connection with Vitrasert Testing.
4.11 Employee Provisions. Prior to the Closing, Chiron
shall exercise commercially reasonable efforts to enter into
an employment agreement with Xxxxxxx Xxxx on terms
acceptable to the Purchaser.
4.12 Use of Chiron Name. Following the Closing, the
Company and its Subsidiaries shall have the right to
continue to use the tradename of Chiron, any derivation
thereof or the Centaur design ("Chiron Name") which is
affixed to products, labeling, packaging materials or
promotional materials as of the Closing Date until the later
of (a) depletion of existing inventories, or (b) the date on
which any requisite regulatory approvals are obtained in
connection with the removal of the Chiron Name from the
foregoing; provided that such use shall in no event continue
longer than two years following the Closing. The Purchaser
will use its commercially reasonable efforts to secure any
such requisite regulatory approvals as promptly as
practicable following the Closing Date. Prior to the
Closing, the parties will enter into a trademark license
agreement in a form reasonably acceptable to Chiron and the
Purchaser governing such use of the Chiron name after the
Closing.
4.13 Insurance Coverage. Prior to the Closing, Chiron
shall take such action as may be required to ensure that any
insurance coverage for any claims that have been filed with
the applicable insurers prior to the Closing relating to the
Company and its Subsidiaries will continue with respect to
such claims following the Closing, and Chiron agrees to pay
to the Company insurance proceeds (net of any out-of-pocket
unreimbursed costs or expenses of Chiron incurred in defense
of such claim) resulting from such coverage promptly after
receipt thereof. From and after the date hereof, Chiron
shall diligently pursue insurance coverage for any claims
filed with Centaur and/or third party insurers prior to the
Closing relating to the Company and its Subsidiaries.
Following the Closing, Chiron shall be responsible for the
control of all claims filed with Centaur and the Company
shall be responsible for the control of all claims filed
with third party insurers, subject to the control exercised
by any insurers in accordance with the applicable insurance
policies. Following the Closing, Chiron shall transfer,
immediately, to the Company, all proceeds (net of
unreimbursed defense costs incurred by Chiron) to which it
is entitled to receive from Centaur and/or third party
insurers, as the case may be, as a result of such claims.
4.14 Human Resource Data Base. At the Purchaser's
request, following the Closing, Chiron shall provide the
Purchaser and the Company with reports containing the
information in Chiron's Human Resource Information System
relating to the domestic employees of the Company.
4.15 Alternative Deal Structures. From and after the
date hereof, the Purchaser and Chiron shall exercise
commercially reasonable efforts to evaluate, identify and
agree upon alternative means of structuring the transactions
contemplated hereby ("Alternative Deal Structures"),
including without limitation, asset transfers between
Subsidiaries of the Company and Affiliates of the Purchaser
for the purpose of providing to the Purchaser tax benefits
following Closing having a present value equal to no less
than $2 million (including the benefits to the Purchaser of
any Net Operating Losses of Chiron Adatomed at the Closing
plus any adjustment to the Purchase Price made pursuant to
Section 1.5.1(c)); provided that such structures impose no
additional cost on Chiron, the Company or the Subsidiaries.
4.16 Retention Bonus Payments. Chiron shall promptly
pay when due all payments to employees of the Company and
its Subsidiaries under the Chiron Retention Plan, Chiron
Transaction Team Program and the Executive Amendment to the
Company's Global Severance Program described in Schedule
4.16; provided that in the case of the Executive Amendment
to the Company's Global Severance Program, Chiron's
responsibility shall be limited to the amount by which the
payments required under such Executive Amendment exceed the
amounts that would have been required had the Company's
Global Severance Program not been so amended.
4.17 Confidentiality. Chiron, the Company and its
Subsidiaries, at all times prior to the Closing and after
any termination of this Agreement, will hold all
confidential information provided to Chiron by or on behalf
of the Purchaser in confidence and will not disclose such
information prior to Closing other than to directors,
officers, employees, and agents of Chiron who need to know
such information for the purposes of the transactions
contemplated by this Agreement. Upon any termination of
this Agreement, Chiron will promptly return to the Purchaser
such information provided to Chiron, including any copies of
such information; provided that Chiron may retain one copy
in its Law Department. Chiron acknowledges that the
Purchaser would be irreparably harmed by a breach of this
Section 4.17 and that there would be no adequate remedy at
law or in damages to compensate the Purchaser for any such
breach and agrees that, in addition to any other remedy, the
Purchaser shall be entitled to one or more injunctions
requiring specific performance by Chiron, the Company or its
Subsidiaries of this Section 4.17, and Chiron, the Company
and its Subsidiaries consent to the entry thereof.
4.18 Product Liability Claims. From and after the date
hereof, Chiron shall use commercially reasonable efforts to
pursue any claims for indemnification under agreements
identified on Schedule 4.18 arising out of any product
liability claims against the Company or any Subsidiary filed
prior to the Closing, and Chiron agrees to pay to the
Company all indemnification proceeds (net of any out-of-
pocket costs or expenses incurred by it in pursuing such
claims) resulting from such indemnification claims promptly
after receipt thereof; provided that notwithstanding the
foregoing, Chiron shall have no obligation to continue to
pursue such indemnification in the event it reasonably
determines that such pursuit would require it to institute
legal proceedings or is not likely to result in recovery;
further provided, however, that at the time of any such
determination, upon the Purchaser's request and at the
Purchaser's expense, Chiron shall pursue such third party
indemnification on the Purchaser's behalf.
ARTICLE V
Covenants of the Purchaser
5.1 Government Approvals. The Purchaser will prepare
and file, at the earliest practicable date, all applications
and other notices required in connection with, and will use
its commercially reasonable efforts to obtain promptly, all
consents, approvals or other actions by any governmental
agency or authority required to be obtained by the Purchaser
in connection with the performance of this Agreement and the
consummation of the transactions contemplated hereby,
including, without limitation, promptly prepare and file
notification in accordance with the HSR Act and other
Competition Laws. The Purchaser will notify Chiron of all
requests, terms or conditions made or sought to be imposed
on the Purchaser in connection with obtaining such approvals
and will discuss with Chiron the acceptability of such
requests, and the Purchaser and Chiron will mutually agree
on the response to such requests.
5.2 Confidentiality. The Purchaser, at all times
prior to the Closing and after any termination of this
Agreement, will hold all confidential information provided
to the Purchaser by or on behalf of Chiron, the Company or
any Subsidiary in confidence and will not disclose such
information prior to Closing other than to directors,
officers, employees and agents of the Purchaser who need to
know such information for the purposes of the transaction
contemplated by this Agreement. Upon any termination of
this Agreement, the Purchaser will promptly return to Chiron
all such information provided to the Purchaser, including
any copies of such information, provided that the Purchaser
may retain one copy in its Law Department. The Purchaser
acknowledges that Chiron would be irreparably harmed by a
breach of this Section 5.2 and that there would be no
adequate remedy at law or in damages to compensate Chiron
for any such breach and agrees that, in addition to any
other remedy, Chiron shall be entitled to one or more
injunctions requiring specific performance by the Purchaser
of this Section 5.2, and the Purchaser consents to the entry
thereof.
5.3 Employee Benefits. From and after the Closing
Date, the Purchaser shall provide the employees of the
Company and its Subsidiaries with employee benefit plans,
programs, policies or arrangements which are no less
favorable in the aggregate than the benefit plans, programs,
policies and arrangements provided by Chiron, the Company
and its Subsidiaries to employees of the Company and its
Subsidiaries prior to the Closing. In addition, the
Purchaser shall provide to employees of the Company and its
Subsidiaries benefit plans, programs, policies or
arrangements that in the aggregate will be approximately
comparable to the benefit plans, programs, policies or
arrangements provided by the Purchaser to its other
employees with similar levels of responsibility; provided
that new or additional benefits may in no event be provided
later than one year following the Closing and nothing shall
require the Purchaser to provide any particular benefit
plan, program, policy or arrangement not currently provided
by the Purchaser to its employees. To the extent any such
benefit plans, programs, policies or arrangements are not
currently provided by the Purchaser to its employees, the
Purchaser will provide replacement benefits that in the
aggregate are approximately comparable. Each such employee
benefit plan, program, policy or arrangement shall give full
credit for each participant's period of service with the
Company and its Subsidiaries prior to the Closing Date for
purposes of determining eligibility, vesting and the amount
of benefits (including subsidies relating to such benefits),
other than for the defined benefit plans. Each employee
welfare benefit plan provided by the Purchaser to the
employees of the Company and its Subsidiaries shall give
full credit for deductibles satisfied under the Company's
and its Subsidiaries' Benefit Plans with respect to the
current plan year toward any deductibles for the remainder
of the plan year during which the Closing occurs, and shall
waive any pre-existing condition limitation for any employee
covered under a Company or Subsidiary Benefit Plan (which is
a group health plan) immediately prior to the Closing Date.
Nothing contained in this Section 5.3 will create any third
party beneficiary rights in any employee or former employee
of the Company or any Subsidiaries in respect of continued
employment or any other matters including, but not limited
to, any rights in any benefit plan, program, policy or
arrangement provided by the Purchaser.
5.4 Warn Ac. The Purchaser shall comply with The
Worker Adjustment Retraining Notification Act (the "Warn
Act") and shall indemnify Chiron against liability
thereunder.
ARTICLE VI
Tax Matters
6.1 Definitions. For purposes of this Agreement,
"Taxes" shall mean all federal, state, local and foreign
income, property, sales and use, excise, withholding,
franchise, real and personal property, transfer, gross
receipt, capital stock, production, business and occupation,
disability, employment, payroll, severance and other taxes,
tariffs or government charges of any nature whatsoever, and
shall include any penalties or interest relating thereto,
and any Loss in connection with the determination,
settlement or litigation of any Tax liability; and "Net
Operating Losses" or "NOLs" shall mean the deduction
allowed as a carryforward for losses incurred in a prior
taxable period.
6.2 Tax Sharing Agreements; Tax and Other Returns and
Reports.
6.2.1 Tax Sharing Agreements. Chiron
represents and warrants to the Purchaser that, except as set
forth in Schedule 6.2.1, neither the Company nor any
Subsidiary is a party to any agreement, contract or
understanding relating to any sharing by the Company or any
Subsidiary of any Tax liability of any person or entity.
6.2.2 Tax and Other Returns and Reports.
Chiron represents and warrants to the Purchaser that, except
as set forth in Schedule 6.2.2, the Company and each
Subsidiary have timely filed or will file (or, where
permitted or required, its respective direct or indirect
parents have timely filed or will file) all required Tax
Returns and have paid all Taxes due for all periods ending
on or before the Closing Date. Except as disclosed in
Schedule 6.2.2, adequate provision has been made in the
books and records of the Company and each Subsidiary, and in
the Financial Statements referred to in Section 2.7 above or
in any other financial statements delivered or to be
delivered to the Purchaser, for all Taxes whether or not due
and payable and whether or not disputed. Neither the
Company nor any Subsidiary has elected to be treated as a
consenting corporation under Section 341(f) of the Code.
Schedule 6.2.2 lists the date or dates through which the IRS
and any other governmental entity or body have examined the
United States federal income tax returns and any other Tax
Returns of the Company and its Subsidiaries. All required
Tax Returns, including amendments to date, have been
prepared in good faith without negligence or willful
misrepresentation and are complete and accurate in all
material respects. Except as set forth in the Schedule
6.2.2, no governmental entity or body has, during the past
three years, examined or is in the process of examining any
Tax Returns of the Company or any Subsidiary. Except as set
forth on Schedule 6.2.2, no governmental entity or body has
proposed (tentatively or definitively), asserted or assessed
or, to the knowledge of Chiron, threatened to propose or
assert, any deficiency, assessment or claim for Taxes and
there would be no basis for any such deficiency assessment
or claim. Chiron has provided to the Purchaser all Tax
Returns filed for the Company on a separate basis (and
related work papers, audit papers or other relevant
documents for Tax Returns) and excerpts from consolidated
and combined returns relating to tax items of the Company,
included therein for the prior three years and for all prior
periods that are still open under the statute of limitations
which have been requested by the Purchaser or its duly
authorized representatives.
6.3 Pre-Closing Tax Indemnity. Chiron shall
indemnify, defend and hold harmless the Purchaser and its
Affiliates (including the Company and each Subsidiary) and
their respective directors, officers, employees and agents
from any Taxes imposed on the Company or any of its
Subsidiaries with respect to any taxable period, or portion
thereof, ending on or prior to the Closing Date (including
without limitation any such Taxes from, or Taxes related to
other transactions which are payable because of,
transactions or elections contemplated by this Agreement),
except to the extent of the aggregate amount of Taxes
reflected on the Closing Date Balance Sheet. Chiron shall
further indemnify, defend and hold harmless the Purchaser
and its Affiliates (including without limitation the Company
and each Subsidiary) and their respective directors,
officers, employees and agents against (a) Taxes for any
period whatsoever of any member of a consolidated or
combined tax group of which Chiron or any of its Affiliates
is, or was at any time, a member, for which the Company
and/or any Subsidiary is liable as a result of its inclusion
in such group, (b) any claim or demand for reimbursement or
indemnification resulting from any transfer by Chiron prior
to the Closing of any Tax benefits or credits to any other
Person, and (c) any Tax liabilities arising out of the
transfer of the Stock pursuant to this Agreement or the
transfer of the stock of Chiron Adatomed as contemplated
hereby. This Section 6.3 shall not apply to any increase in
tax resulting from any reassessment of real or personal
property taxes as a result of the transfer of stock of the
Company to the Purchaser, or with respect to any increase in
tax resulting from changes in the valuation of any asset or
liability of the Company due to the election contemplated
under Section 6.9.
6.4 De Minimis Taxes. Chiron shall not be liable
under Section 6.3 for any amount assessed for any particular
Tax or Tax period of less than $5,000.
6.5 Tax Periods. With respect to any Taxes for any
taxable period that includes but does not end as of the
Closing Date, the amount of Taxes subject to indemnification
hereunder shall be calculated as if such taxable period
ended as of the close of business on the Closing Date,
except that property Taxes calculated on an annual basis
shall be prorated based on the number of days in the annual
period elapsed through the Closing Date compared to the
number of days in the annual period elapsing after the
Closing Date.
6.6 Offset for Future Reductions. To the extent an
increase in Tax for any period which gives rise to a
liability of Chiron under Section 6.3 is the result of an
adjustment which will result in a corresponding decrease in
Tax for a subsequent period, Chiron shall be liable for the
full amount of such increase for such period and the
Purchaser shall pay Chiron the amount of such corresponding
decrease in Tax for such subsequent period (if any) when
such corresponding decrease in Tax is actually realized by
the Company in such subsequent period. Chiron promptly
shall indemnify and reimburse the Purchaser for any Loss if
such decrease in Tax, as claimed on a Tax Return or any
other document, is subsequently successfully contested by
the applicable taxing authority.
6.7 Net Operating Losses. The indemnity in Section
6.3 shall not apply to, and Chiron shall not be liable for,
any increase in Tax resulting from any adjustment to any Net
Operating Loss of the Company or its Subsidiaries available
to offset income of the Company or the Purchaser in a Tax
period beginning on or after the Closing Date.
Additionally, Chiron makes no representation with respect to
the ability of the Company or its Subsidiaries to use after
the Closing Date any Net Operating Loss available
immediately prior to the Closing Date, and Chiron shall not
have any indemnity obligation hereunder to the extent that
the Company, its Subsidiaries or the Purchaser are unable to
use after the Closing Date NOLs available immediately prior
to the Closing Date.
6.8 Tax Proceedings.
6.8.1. Right to Control Proceedings. Chiron
shall have the responsibility for, and the right to control,
at Chiron's expense, the audit (and disposition thereof) of
any Tax Return relating to periods ending on or prior to the
Closing Date and to participate in the disposition of the
audit of any Tax Return relating to the periods ending after
the Closing Date if such audit or disposition thereof could
give rise to a claim for indemnification hereunder (any such
audit or disposition, a "Tax Proceeding").
6.8.2. Notice; Reports. Chiron's right to
control a Tax Proceeding shall commence upon the receipt by
the Purchaser or any of its Affiliates (including, after the
Closing Date, the Company and its Subsidiaries) of a
proposed adjustment to Tax for the period under audit or
examination communicated in writing. The Purchaser shall
promptly notify Chiron in writing upon their learning of the
pendency of a Tax Proceeding and shall fully cooperate with
Chiron in the conduct of such Tax Proceeding. The Purchaser
shall provide to Chiron, once per year, a list of any Tax
audits, examinations or other proceeding that is or could
result in a Tax Proceeding in progress, the nature of the
Tax and Tax period involved and the status of the
proceeding, including the amount of the proposed adjustment,
if known. The failure on the part of the Purchaser to
promptly notify Chiron of the pendency of a Tax Proceeding
or the failure of the Purchaser to provide the information
set forth in the immediately preceding sentence shall not in
any way discharge Chiron's indemnity obligations hereunder,
except that the Purchaser shall be liable for any increase
in penalties, interest, other assessments or fees and
expenses which are due to any delay in promptly notifying
Chiron of the pendency of any Tax Proceeding and shall be
responsible for any indemnity obligations to the extent that
Chiron is materially prejudiced as a result of such delay.
Without the prior written consent of Chiron (which consent
shall not be unreasonable withheld), neither the Purchaser
nor any of its Affiliates shall settle or compromise any
claim for Taxes that might result in Chiron's being required
to make an indemnity payment pursuant to Section 6.3. The
Purchaser shall, and shall cause Company and Subsidiaries
to, cooperate with Chiron including providing reasonable
access to records, returns and supporting information, in
connection with any Tax Proceeding or matter as to which the
Purchaser may seek indemnity or other relief for Chiron
under this Article 6. The Purchaser promptly shall pay
Chiron any refunds, rebates or other recoveries received by
the Company or a Subsidiary on account of Taxes paid before
the Closing. The Purchaser shall have the right directly or
through its designated representatives, to review in advance
and comment upon all submissions made in the course of
audits or appeals thereof to any governmental entity or body
relating to periods ending or treated by this Agreement as
ending on or prior to the Closing Date and to approve the
disposition of any audit adjustment with respect to such
periods if such disposition will or might reasonably be
expected to result in an increase in Taxes, of $50,000 or
more, of the Purchaser, the Company and/or any Subsidiary
for any period beginning at or after the Closing or as to
which the Company and/or any Subsidiary is jointly or
severally liable as a result of its inclusion in such group
prior to the Closing Date. Chiron will not, and will not
permit any of its Affiliates to, without the consent of the
Purchaser (which consent shall not be unreasonably
withheld), make any elections with respect to Taxes that are
inconsistent with prior elections reflected in prior Tax
Returns or the Audited Financial Statements. Chiron will
not amend, or permit any of its Affiliates to amend, any Tax
Return for any period prior to or including the Closing Date
in a manner that would have an adverse effect on the
Company, any Subsidiary or the Purchaser or its Affiliates,
or subject them to any liability for Taxes, except for
amended returns necessary to correct any accounting or
computational error discovered subsequent to the Closing
Date or to make adjustments with respect to any item the
treatment of which is clear under applicable tax laws,
regulations or rulings. Chiron shall provide to the
Purchaser a copy of any amended return prepared thirty days
prior to the filing of such return.
6.9 Section 338(h)(10) Election. The Purchaser and
Chiron agree to join in the making of an election pursuant
to Section 338(h)(10) of the Internal Revenue Code of 1986,
as amended, for federal income tax purposes, but not for
California state tax purposes. The Purchaser shall prepare
an allocation schedule (the "Allocation Schedule")
allocating the Purchase Price and the liabilities of the
Company and its Subsidiaries among the assets of the Company
and its Subsidiaries in accordance with Section 1060 of the
Code and the regulations issued thereunder, and shall submit
such Allocation Schedule to Chiron for its review and
signature not later than 30 days prior to the filing date.
Chiron hereby agrees that so long as the Allocation Schedule
has been prepared in accordance with Section 1060 of the
Code and the regulations issued thereunder, it will file all
tax returns and reports in a manner consistent with the
Allocation Schedule and will not take any position for
purposes of any Taxes respecting the allocation of the
Purchase Price and the liabilities of the Company and its
Subsidiaries which is inconsistent with the Allocation
Schedule.
6.10 Survival, Etc. Notwithstanding anything to the
contrary contained in this Agreement, the representations
and warranties and the indemnification obligations set forth
in this Article VI shall survive the Closing and shall
remain in effect until the expiration of the applicable
statute of limitations. Any matter as to which a claim has
been asserted by notice to the other party that is pending
or unresolved at the end of any applicable limitation period
shall continue to be covered by this Article VI
notwithstanding any applicable statute of limitations (which
the parties hereby waive) until such matter is finally
terminated or otherwise resolved by the parties or by a
court of competent jurisdiction and any amounts payable
hereunder are finally determined and paid. This Article VI
shall not be deemed to preclude or otherwise limit in any
way the exercise of any other rights or pursuit of other
remedies for the breach of this Agreement or with respect to
any misrepresentation. Chiron agrees to notify the
Purchaser of any liabilities, claims or misrepresentations,
breaches or other matters covered by this Article VI upon
discovery or receipt of notice thereof (other than from the
Purchaser), whether before or after the Closing.
ARTICLE VII
Conditions to Closing
7.1 General Conditions. Unless waived in writing by
all parties, the obligations of the parties to proceed with
the Closing are subject to the satisfaction of the
conditions that no law, rule, regulation, decree,
injunction, judgment, order, ruling or writ shall have been
enacted, entered, issued, promulgated or enforced by any
governmental entity or body, nor shall any action, petition,
investigation, suit or other proceeding have been instituted
and remain pending or, to the knowledge of Chiron or the
Purchaser, have been threatened and remain so by any
governmental entity or body at what would otherwise be the
Closing Date, which prohibits the transactions contemplated
by this Agreement.
7.2 Conditions to the Obligations of the Purchaser.
The obligations of the Purchaser to proceed with the Closing
are subject to the satisfaction at or prior to the Closing
of all of the conditions set forth in Section 7.1 and this
Section 7.2, any one or more of which conditions set forth
in this Section 7.2 may be waived, in whole or in part, by
the Purchaser:
7.2.1 Accuracy of Representations. The
representations and warranties of Chiron in this Agreement
shall be true and correct at and as of the date of the
Closing as if made at and as of the Closing, except where
the failure of the representations and warranties to be true
and correct would not reasonably be expected to have a
material adverse affect on the assets, properties, condition
(financial or otherwise), results of operations, or the
business of the Company and its Subsidiaries taken as a
whole, and the Purchaser shall have received (i) a
certificate, dated the Closing Date, of the Chief Financial
Officer or the Chief Executive Officer of Chiron to that
effect, (ii) a certificate, dated the Closing Date of the
Vice President of Regulatory Affairs to that effect with
sole and specific reference to Section 2.14 as it relates to
Regulatory Laws and (iii) certificates, dated the Closing
Date, of such officers or other employees of the Company
with responsibility for the particular subject areas or
subject matters covered in Article II to that effect with
respect to such particular subject areas or subject matters.
7.2.2 Performance of Covenants. Chiron shall
have performed and complied in all material respects with
all covenants and agreements contained in this Agreement
that are required to be performed or complied with by it at
or prior to the Closing, and the Purchaser shall have
received a certificate, dated the Closing Date, of the Chief
Financial Officer or the Chief Executive Officer of Chiron
to that effect.
7.2.3 HSR Act. The filing of the required
notification under the HSR Act and other Competition Laws
required to be filed prior to the Closing and the approval,
if applicable, or expiration or early termination of the
applicable waiting period, if any, without there being any
continuing objection thereto.
7.2.4 Stock Certificate. Chiron shall have
delivered to the Purchaser a certificate for the Stock, duly
endorsed (or accompanied by stock powers duly endorsed) in
blank.
7.2.5 Opinion of Chiron Counsel. The
Purchaser shall have received from Xxxxxxx X. Xxxxx, Esq.,
Senior Vice President and General Counsel of Chiron, a legal
opinion in substantially the form attached as Exhibit B.
7.2.6 Consents. Chiron shall have obtained
and provided to the Purchaser all required authorizations,
approvals, consent and Permits listed on Schedule 2.3 and
shall have made all registrations and filings listed on
Schedule 2.3 and the Purchaser shall have obtained all
authorizations, approvals, consents and Permits listed on
Schedule 3.3 without any materially adverse conditions or
terms thereto, each in form and substance reasonably
satisfactory to the Purchaser.
7.2.7 Reserved.
7.2.8 Chiron Adatomed. Chiron shall have
transferred all of the capital stock of Chiron Adatomed to
the Company.
7.2.9 Chiron Canada. On or prior to the
Closing Date, the Company shall have transferred all of the
capital stock of Chiron Canada to Chiron in a transaction
the form and substance of which are reasonably satisfactory
to the Purchaser, and all of the assets and liabilities of
Chiron Canada (other than the Net Operating Losses) will be
transferred to the Company.
7.2.10 Registration of Directors. The
directors of the Company and its Subsidiaries shall have
submitted their resignations in writing to the Company and
the Subsidiaries, as applicable. Such resignations shall be
effective as of the Closing.
7.2.11 Non-Competition Agreements. Chiron
shall have executed and delivered and shall have caused its
Affiliates to execute and deliver a non-competition
agreement substantially in the form attached as Exhibit C
hereto.
7.2.12 Intercompany Transactions. Chiron shall
have delivered to the Purchaser evidence in form and
substance satisfactory to the Purchaser showing the
elimination of all of the intercompany indebtedness between
the Company and its Subsidiaries on the one hand and Chiron
and its other Affiliates on the other listed on Schedule
2.17 and the Company shall have transferred all of its cash
and cash equivalents to Chiron as of the Closing.
7.2.13 Material Adverse Change. There shall
not have been any material adverse change in or to the
assets, properties, condition (financial or otherwise),
results of operations, or the business of the Company and
its Subsidiaries taken as a whole between the date hereof
and the Closing Date, nor shall any events have occurred
between the date hereof and the Closing Date which would
reasonably be expected to result in such a material adverse
change.
7.2.14 Reserved.
7.2.15 Chiron Vision France, S.A. The
statutory net equity (as defined by applicable French or
English law) of Chiron Vision France, S.A. ("XX Xxxxxx")
and Chiron Vision (UK) shall have been increased to an
amount which satisfies the minimum statutory net equity
requirements under such law.
7.2.16 Cash Management. Any agreements or
arrangements providing Chiron with the right to remove cash
from bank accounts of the Company, after the Closing shall
have been terminated, and the Chief Financial Officer or the
Chief Executive Officer of Chiron shall have delivered to
the Purchaser a certificate to that effect.
7.3 Conditions to the Obligations of Chiron. The
obligations of Chiron to proceed with the Closing are
subject to the satisfaction at or prior to the Closing of
all of the conditions set forth in Section 7.1 and this
Section 7.3, any one or more of which conditions set forth
in this Section 7.3 may be waived, in whole or in part, by
Chiron.
7.3.1 Accuracy of Representations. The
representations and warranties of the Purchaser in this
Agreement shall be true and correct in all material respects
at and as of the date of the Closing as if made at and as of
the Closing, and Chiron shall have received a certificate,
dated the Closing Date, of the Chief Financial Officer of
the Purchaser to that effect.
7.3.2 Performance of Covenants. The Purchaser
shall have performed and complied in all material respects
with all covenants and agreements contained in this
Agreement that are required to be performed or complied with
by it at or prior to the Closing, and Chiron shall have
received a certificate, dated the Closing Date, of the Chief
Financial Officer of the Purchaser to that effect.
7.3.3 HSR Act. The filing of the required
notice under the HSR Act and other Competition Laws required
to be filed prior to the Closing and the approval, if
applicable, or expiration or early termination of the
applicable waiting period, if any, without there being any
continuing objection thereto.
7.3.4 Payment. The Purchaser shall have
delivered to Chiron by wire transfer to such bank account as
Chiron shall specify in writing cash in immediately
available funds in the amount of the Purchase Price, subject
to the provisions of Section 1.4.
7.3.5 Opinion of Purchaser Counsel. Chiron
shall have received from Xxxxxx X. Xxxxxx, Senior Vice
President and General Counsel of the Purchaser, a legal
opinion in substantially the form attached as Exhibit D.
7.3.6 Claremont Lease. Chiron and the
Purchaser shall have entered into an agreement providing for
the occupancy by the Purchaser of the Claremont Property as
provided in Section 4.7, payment by the Purchaser of all
maintenance and operating expenses and indemnification for
any Losses incurred by Chiron as a result of any acts or
omissions by the Company or its Subsidiaries in connection
with their occupancy of the Claremont property following the
Closing.
ARTICLE VIII
Termination
8.1 Grounds for Termination. This Agreement may be
terminated at any time prior to Closing:
8.1.1. Mutual Agreement. by the mutual written
agreement of Chiron and the Purchaser;
8.1.2 Expiration. by Chiron or by the
Purchaser if the Closing shall not have occurred on or
before February 28, 1998, or such other date upon which
Chiron and the Purchaser may agree in writing; provided,
however, that February 28, 1998 shall be extended until the
end of any cure period which commences prior thereto under
either Section 8.1.7 or Section 8.1.9;
8.1.3 Contravention of Law. by Chiron or by
the Purchaser if consummation of the transactions
contemplated hereby would violate any nonappealable final
order, decree or judgment of any court or governmental body
having competent jurisdiction;
8.1.4 Fiduciary Obligation. by Chiron if the
Chiron Board of Directors shall have determined reasonably
and in good faith, upon the advice of outside Delaware
counsel, that such termination is required by its fiduciary
duties to Chiron stockholders under applicable laws, by
reason of an alternative, bona-fide offer having been made
for the acquisition of the Company and its Subsidiaries or
of all or substantially all of their businesses;
8.1.5 Purchaser's Breach. by Chiron (a) if
the Purchaser shall refuse or fail after notice to perform
any material covenant or agreement required to be performed
by it under this Agreement or (b) if any representation or
warranty of the Purchaser contained in this Agreement shall
prove to have been inaccurate or misleading in any material
respect at the time when made;
8.1.6 Reserved.
8.1.7 Chiron's Breach. by the Purchaser (a)
if Chiron shall refuse or fail after notice to perform any
material covenant or agreement required to be performed by
it under this Agreement and such failure is not reasonably
capable of being cured or, if capable of being cured, is not
cured by Chiron by the earlier of thirty days after the
receipt of notice thereof, or (b) if Chiron breaches any
material covenant under Section 4.2, and such breach would
reasonably be expected to have a material adverse effect on
the assets, properties, condition (financial or otherwise),
results of operations, or the business of the Company and
its Subsidiaries taken as a whole, and such breach is not
reasonably capable of being cured or, if capable of being
cured, is not cured by Chiron within 30 days after receipt
of notice thereof.
8.1.8 Failure of a Chiron Condition. by
Chiron at any time after the date hereof if any event occurs
or condition exists which would render impossible the
satisfaction of one or more conditions to the obligations of
Chiron to consummate the transactions contemplated by this
Agreement as set forth in Section 7.1 or Section 7.3 and
such event or condition is not reasonably capable of being
cured or, if capable of being cured, is not cured by the
Purchaser within 30 days after the receipt of notice of such
event or condition; and
8.1.9 Failure of a Purchaser Condition. by
the Purchaser at any time after the date hereof if the
satisfaction of one or more conditions to the obligations of
the Purchaser to consummate the transactions contemplated by
this Agreement as set forth in Section 7.2.1 or Section
7.2.13 has become impossible, and is not reasonably capable
of being cured or, if capable of being cured, is not cured
by Chiron within 30 days after receipt of such notice of
such fact.
8.2 Notice. Any party desiring to terminate this
Agreement pursuant to this Section shall give written notice
of termination to the other party.
8.3 Effect of Termination. Subject to the provisions
of Section 8.4, if this Agreement is terminated pursuant to
Section 8.1, such termination shall be without liability of
any party (or any shareholder, director, officer, employee
or agent of any party) to any other party to this Agreement.
The provisions of this Section 8.3 and Section 5.2 shall
survive any termination hereof.
8.4 Termination Fees.
8.4.1. Payments by the Purchaser. In the event
that the transactions contemplated by this Agreement are not
consummated by the Purchaser, the Purchaser shall pay to
Chiron the sum of $15 million in cash as a termination fee,
unless the reason the transactions have not been consummated
is based on any of the following: (i) a termination of this
Agreement by Chiron under Section 8.1.3 or 8.1.4 or because
of a failure of the condition set forth in Section 7.3.3 or
(ii) a termination by the Purchaser either under Section
8.1.7 or 8.1.9, or because of a failure of the condition set
forth in Section 7.2.3.
8.4.2 Payment by Chiron. If this Agreement is
terminated by Chiron pursuant to Section 8.1.4, Chiron shall
immediately pay to the Purchaser the sum of $15 million in
cash as a termination fee.
ARTICLE IX
Representations and Warranties; Indemnities; Survival
9.1 Chiron General Indemnity. Chiron shall indemnify
and hold harmless the Purchaser and its Affiliates and their
respective directors, officers, employees and agents against
any and all Losses arising out of or attributable to the
following matters:
9.1.1 Representations, Warranties and
Covenants.
(a) The breach or inaccuracy of any
representation or warranty of Chiron contained in this
Agreement, (b) any matter (other than third party
claims) included on an Amended Schedule arising after
the date of this Agreement but before the Closing that
would have constituted a breach or inaccuracy of any
representation or warranty of Chiron had it occurred
prior to the date of this Agreement and not been
disclosed and (c) the breach or failure to perform any
covenant or agreement to be performed by Chiron or any
of its Affiliates under this Agreement other than under
Section 4.2 and Section 4.5. Chiron, however, shall
not be liable for any indemnity amounts in respect of
Losses under this Section 9.1.1 unless (i) the amount
of such Losses (less payments received from insurance
and third party indemnification, subject to the
provisions of Section 9.4) relating to any claim made
by a third party against the Company or any Subsidiary
for infringement of a patent to the extent arising out
of or attributable to any act or omission that occurred
prior to the Closing (other than claims identified on
Schedule 2.13) exceeds $2.5 million individually, or
(ii) in any other case, the amount of such Losses
exceeds $1 million individually and in both cases
exceeds $5 million in the aggregate, in which event
Chiron shall indemnify and hold harmless the Purchaser
and its Affiliates and their respective directors,
officers, employees and agents for all Losses related
to an individual claim that exceeds $2.5 million or $1
million, as the case may be, including the first $1
dollar of such claims. The indemnity obligations of
Chiron under this Section 9.1.1 shall expire upon the
conclusion of the second year-end audit following the
Closing, but in no event later than the conclusion of
the audit of the Company's financial statements for the
period ending December 31, 1998.
9.1.2 Third Party Claims.
(a) Any claim asserted against the Company
or any of its Subsidiaries by a third party after the
Closing to the extent arising out of or attributable to
any act or omission that occurred prior to the date of
this Agreement, except to the extent reserved against
in, or reflected as a liability on, the Audited Balance
Sheet or the Schedules, (b) any third party claim
arising out of or attributable to the matters disclosed
on Schedule 9.1.2(b), (c) any product liability claims
against the Company or its Subsidiaries disclosed on
Schedule 9.1.2(c) to the extent the Company and its
Subsidiaries do not receive insurance proceeds or third
party indemnification, and (d) any third party claim to
the extent arising out of or attributable to any act or
omission that occurred after the date of this Agreement
but before the Closing and is disclosed to the
Purchaser on an Amended Schedule other than matters
expressly permitted or consented to by the Purchaser
under Section 4.2 and Section 4.5. Chiron, however,
shall not be liable for any indemnity amounts in
respect of Losses under this Section 9.1.2 unless the
amount of such Losses, less payments received from
insurance and third party indemnification, subject to
Section 9.4, received by the Purchaser after pursuing
the same in accordance with Section 9.4 exceeds $5
million in aggregate and (i) $50,000 with respect to
any single claim under subparagraph (a) and (ii)
$100,000 with respect to any single claim under
subparagraph (d), in which events Chiron shall
indemnify and hold harmless the Purchaser and its
Affiliates and their respective directors, officers,
employees and agents for 50% of all such Losses in
excess of the applicable threshold. Losses indemnified
under this Section 9.1.2 shall (i) include costs and
expenses of defense of such third party claims as well
as amounts paid to such third party claimants (whether
by way of final court order or out-of-court settlement)
and (ii) shall exclude any other Losses arising out of
or attributable to such third party claims, including
without limitation, costs and expenses incurred to
effect any change to the assets, properties, condition
or business of the Company and its Subsidiaries. The
indemnity obligations of Chiron under this Section
9.1.2 shall expire upon the date two years after the
Closing.
9.1.3 Environmental Claims. Any Losses of the
Company or any Subsidiary arising out of the violation of
any Environmental Law which violation occurred prior to the
Closing. Chiron shall indemnify and hold harmless the
Purchaser and its Affiliates and their respective directors,
officers, employees and agents for all such Losses (after
insurance and third party indemnification, subject to the
provisions of Section 9.4). The indemnity obligations of
Chiron under this Section shall expire upon the date five
years after the Closing.
9.1.4 Tax Losses. Losses related to Tax
matters are expressly excluded from Section 9.1 and Article
IX (except with respect to indemnification procedures, which
shall be governed by Section 9.3) and instead shall be
governed by the provisions of Article VI.
9.1.5 Liability Limits. The obligations of
Chiron to indemnify the Purchaser under Section 9.1 for
Losses incurred as a result of any claims asserted against
the Company or against the Purchaser arising out of any
violations of any Environmental Laws, Regulatory Law or
alleged or actual infringement by the Company or any
Subsidiary of any patent of any other Person shall be
limited to an aggregate maximum of $100 million. The
obligations of Chiron to indemnify the Purchaser under any
other clause or provision in Section 9.1 for Losses incurred
by the Company or by the Purchaser shall be limited to an
aggregate maximum of $50 million. The obligations of Chiron
to indemnify the Purchaser under Section 9.1 and under the
provisions of Article VI with respect to any tax matter or
as a result of fraud on the part of Chiron shall not be
limited as to amount.
9.1.6 Miscellaneous. Notwithstanding anything
to the contrary contained herein, neither party hereto (the
"Indemnitor") shall be responsible for indemnifying the
other party or its Affiliates or any of their respective
directors, officers, employees or agents (collectively, the
"Indemnitee") for any consequential damages incurred by
the Indemnitee, including loss of profits of the Indemnitee,
resulting from any event giving rise to the Indemnitee's
indemnity claim. This Article IX shall constitute exclusive
remedy for any and all claims arising out of the
transactions contemplated hereby. This Section 9.1.6 shall
survive any termination of this Agreement.
9.2 Purchaser General. The Purchaser shall indemnify
and hold harmless Chiron and its Affiliates and their
respective directors, officers, employees and agents against
any and all Losses to the extent arising out of or
attributable to (a) the inaccuracy of any representation and
warranty of the Purchaser contained in this Agreement and
(b) the breach or failure to perform any covenant or
agreement to be performed by the Purchaser under this
Agreement.
9.3 Indemnification Procedures. Any person seeking
indemnity pursuant to Section 9.1 or Section 9.2 (the
"Indemnified Party") shall use its reasonable efforts to
notify the indemnifying party in writing promptly upon
becoming aware of any claim, suit, proceeding or liability
to which such indemnification may apply; provided however
that any failure to provide such notice shall not constitute
a waiver of the indemnifying party's indemnity obligations
hereunder except to the extent the indemnifying party is
actually prejudiced in defense of a third party's claim
against the Indemnified Party. The indemnifying party shall
have the right, within ten business days of receipt of
notice thereof, to assume and control the defense and
settlement of, a third party's claim, suit or proceeding
against the Indemnified Party (a "Third Party Claim") at
the indemnifying party's sole cost and expense and with
counsel reasonably satisfactory to the Indemnified Party;
provided, however, that the indemnifying party will not have
the right to assume the defense of any Third Party Claim
that seeks criminal penalties. If the indemnifying party's
right to assume the defense is exercised, the indemnifying
party shall be deemed to have waived all rights to contest
its liability to the Indemnified Party in respect of such
Third Party Claim. The Indemnifying Party will not settle
or compromise any Third Party Claim that it elects to defend
without the prior written consent of the Indemnified Party,
which consent will not be unreasonably withheld. If the
right to assume and control the defense is exercised, the
Indemnified Party shall have the right to participate in,
but not control, such defense at its own expense and the
indemnifying party's indemnity obligations shall be deemed
not to include attorneys' fees and litigation expenses
incurred in such participation by the Indemnified Party
after the assumption of the defense by the indemnifying
party. If the indemnifying party does not assume the
defense of the Third Party Claim, the Indemnified Party may
defend and settle the Claim for the account and cost of the
indemnifying party; provided, that the Indemnified Party
will not settle the Third Party Claim without the prior
written consent of indemnifying party, which consent will
not be unreasonably withheld. The indemnifying party will
promptly pay, or reimburse the Indemnified Party for payment
of, costs and expenses (including fees and expenses of
counsel) incurred in the defense thereof. The Indemnified
Party shall cooperate with the indemnifying party and,
subject to obtaining proper assurances of confidentiality
and privilege, will make available to the indemnifying party
all pertinent information under the control of the
Indemnified Party.
9.4 Pursuit of Insurance and Third Party
Indemnification. The Purchaser shall consult with Chiron
regarding the pursuit of insurance and third party
indemnification and, subject to the following sentence, the
Purchaser will diligently pursue insurance and third party
indemnification for a period of one year. Notwithstanding
the foregoing, the Purchaser shall have no obligation to
continue to diligently pursue insurance or third party
indemnification in the event it reasonably determines that
such pursuit would require it to institute legal proceedings
or is not likely to result in any recovery; provided that at
the time of any such determination, the Purchaser shall
either assign to Chiron the right to pursue such insurance
or third party indemnification or, upon Chiron's request and
at Chiron's expense, pursue such insurance or third party
indemnification on Chiron's behalf.
9.5 Survival. Any matter as to which a claim has been
asserted by notice to the other party that is pending or
unresolved at the end of any applicable limitation period or
on any applicable expiration date of such other party's
indemnity obligations hereunder shall continue to be covered
by this Article IX notwithstanding any applicable expiration
of any party's indemnity obligations set forth in this
Article IX until such matter is finally terminated or
otherwise resolved by the parties or by a court of competent
jurisdiction and any amounts payable hereunder are finally
determined and paid.
ARTICLE X
Certain Definitions
10.1 Certain Definitions. For all purposes of this
Agreement, except as otherwise expressly provided or unless
the context otherwise requires:
"Affiliate" means a Person that directly, or
indirectly through one or more intermediaries, controls, or
is controlled by, or is under common control with, a
specified Person. For the purposes of this definition,
"control" (including, with correlative meanings, the terms
"controlling", "controlled by" and "under common control
with"), as applied to any Person, means (a) the possession,
directly or indirectly, of the power to direct or cause the
direction of the management and policies of that Person,
whether through the ownership of voting securities or by
contract or otherwise, or (b) the ownership of more than 25%
of the voting securities of that Person. Notwithstanding
anything to the contrary contained herein, "Affiliate"
shall not include, in the case of Chiron, Novartis AG or any
Affiliate of Novartis (other than Chiron and its
subsidiaries).
"Agreed Procedure" shall mean, when used with
reference to the Closing Date Balance Sheet, that such
Balance Sheet will be prepared from the books and records of
the Company in accordance with GAAP in a manner consistent
with past practices, except that the standard of materiality
applicable shall be that which would be appropriate for the
Company as an independent entity without regard to its
consolidation with Chiron.
"Agreement" means this Agreement by and among Chiron
and the Purchaser, as amended or supplemented together with
all Exhibits and Schedules attached or incorporated by
reference.
"Centaur" shall mean Chiron's wholly-owned captive
insurance subsidiary.
"Claremont Property" shall mean the real property and
improvements thereon owned by the Company and located in
Claremont, California.
"Code" shall mean the United States Internal Revenue
Code of 1986, as amended.
"Environmental Laws" shall mean all laws relating to
the protection of the environment including all requirements
pertaining to reporting, licensing, permitting, controlling,
investigating, or remediating emissions, discharges,
releases, or threatened releases of Hazardous Substances,
chemical substances, pollutants, contaminants or toxic
substances, materials or wastes, whether solid, liquid or
gaseous in nature, into the air, surface water, groundwater
or land, or relating to the manufacture, processing
distribution, use, treatment, storage, disposal, transport
or handling of Hazardous Substances, chemical substances,
pollutants, contaminants or toxic substances, materials or
wastes, whether solid, liquid or gaseous in nature.
"ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended.
"ERISA Affiliate" shall mean any company that, as of
the relevant measuring date under ERISA, is a member of a
controlled group of corporations or under common control
with the Company or any Subsidiary within the meaning of
Section 414(b) and (c) of the Code.
"GAAP" shall mean generally accepted accounting
principles in the United States as in effect from time to
time.
"Hazardous Substances" shall mean substances that are
defined or listed in, or otherwise classified pursuant to,
any applicable laws as "hazardous substances," "hazardous
materials," "hazardous wastes" or "toxic substances," or
any other formulation intended to define, list or classify
substances by reason of deleterious properties such as
ignitability, corrosivity, reactivity, radioactivity,
carcinogenicity, reproductive toxicity or "EP toxicity,"
and petroleum and drilling fluids, produced waters and other
wastes associated with the exploration, development, or
production of crude oil, natural gas or geothermal energy.
"Huntington Lease" shall mean the lease dated
September 12, 1991 between Acorn Development, Inc. and
Intraoptics, Inc.
"Knowledge" shall mean, with respect to any Person,
the actual knowledge of any officer of such Person, the law
department of such Person or any other employee of such
Person with responsibility for the particular subject area
or subject matter.
"Lien" shall mean any mortgage, pledge, security
interest, lien, charge, encumbrance, equity, claim, option,
tenancy, right or restriction on transfer of any nature
whatsoever.
"Loss" shall mean any loss, damage, liability, cost,
deficiency, assessment and expense including, without
limitation, any interest, fine, court cost and reasonable
investigation cost, penalty and attorneys' and expert
witnesses' fees, disbursements and expenses, but shall not
include any component of damages for lost profits of, or
consequential damages suffered by, Chiron, the Purchaser,
the Company, its Subsidiaries or any of their respective
Affiliates or any of their respective directors, officers,
employees and agents.
"Lyon Reserve" shall mean an amount reflected on the
Audited Balance Sheet and the Closing Date Balance Sheet as
a reserve for rental obligations in excess of market value
under the lease dated January 2, 1990 between Domilyon
Corporation and Domilens Laboratories, as amended by a First
Amendment dated May 10, 1994.
"Xxxxxx Keynes Lease" shall mean the lease dated May
25, 1990 between Xxxxxx Keynes Development Corporation and
Intraoptics (UK) Limited.
"Net Assets" shall mean, when used with reference to
the Audited Balance Sheet and the Closing Date Balance Sheet
(prepared in accordance with the Agreed Procedure in the
case of the Closing Date Balance Sheet), as the case may be,
total assets of the Company adjusted for purposes of
calculating the Upward Purchase Price Adjustment or Downward
Purchase Price Adjustment, as the case may be, by excluding
(a) cash, (b) the net value (gross value minus depreciation)
of the Claremont Property, (c) intangible assets, net of
accumulated amortization, consisting of purchased
technology, patents, licenses, goodwill, tradenames,
customer lists and start up costs (except for consideration
provided to Xxxx Xxxx and Xxxxxx Xxxxxxx capitalized in
accordance with GAAP), (d) any deferred tax assets for which
the Company will not obtain a future benefit as a result of
the Section 338(h)(10) election, and (e) with respect to the
Closing Date Balance Sheet only, any amounts paid prior to
or as of the Closing Date to Xxxxxx X. (Hans) Hellenkamp
which are capitalized on the Closing Date Balance Sheet in
accordance with GAAP other than amounts creditable against
royalties accruing following the Closing (not to exceed
$250,000), less (i) current liabilities other than current
portion of long-term liabilities except the portion of such
liabilities relating to capital leases), (ii) long-term
capital leases, (iii) that portion of the Lyon Reserve which
corresponds to periods following September 30, 1998, and
(iv) with respect to the Closing Date Balance Sheet only two
times the value of (A) the note payable to CEMPE with a
maturity date of October 31, 1999, (B) that portion of the
Lyon Reserve that corresponds to periods prior to September
30, 1998, (C) other long-term liabilities including taxes,
but excluding any deferred tax liabilities which the Company
will not be obligated to pay as a result of the Section
338(h)(10) election, (D) obligations relating to the Xxxxxx
Keynes Lease and the Huntington Lease (unless such leases
shall have been assigned to Chiron with any requisite
consents, and Chiron shall have assumed such obligations
effective as of the Closing Date), and (E) the current
portion of long-term liabilities except the portion of such
liabilities relating to capital leases.
"Permit" shall mean any license, permit, franchise,
certificate of authority, or order, or any waiver of the
foregoing, required to be issued by any Governmental Entity.
"Permitted Liens" shall mean the following types of
Liens: (a) statutory Liens of landlords, statutory Liens of
banks and rights of set-off, statutory Liens of carriers,
warehousemen, mechanics, repairmen, workmen and materialmen,
and other Liens imposed by law, in each case incurred in the
ordinary course of business (i) for amounts not yet overdue
or (ii) for amounts that are overdue and that (in the case
of such amounts overdue for a period in excess of 30 days)
are being contested in good faith by appropriate
proceedings, so long as such reserves or other appropriate
provisions, if any, as shall be required by GAAP shall have
been made for any such contested amounts; (b) easements,
rights-of-way, restrictions, encroachments, and other minor
defects or irregularities in title, in each case which do
not and will not interfere in any material respect with the
ordinary conduct of the business of Company or any of its
Subsidiaries; (c) Liens in favor of customs and revenue
authorities arising as a matter of law to secure payment of
customs duties in connection with the importation of goods;
and (d) any zoning or similar law or right reserved to or
vested in any governmental office or agency to control or
regulate the use of any real property and (e) Liens that do
not either adversely affect the value of the real property
subject to such Lien or prohibit or interfere with the
operations of that real property or the business of the
Company or the Subsidiaries.
"Person" shall mean an individual, a partnership, a
joint venture, a corporation, a trust, an unincorporated
organization, a governmental entity or any other entity.
"Products" shall mean products, technology and
services, manufactured, sold, licensed, or otherwise
exploited by the Company or any Subsidiary in connection
with their business prior to the Closing.
"Regulatory Law" shall mean the FDC Act or any
similar or analogous legislation in any foreign jurisdiction
and the regulations of the FDA or any similar or analogous
foreign governmental entity or body.
"Schedule" means a disclosure schedule delivered by
Chiron to the Purchaser prior to the date of this Agreement
and "Amended Schedule" means an amendment to a Schedule,
delivered by Chiron to the Purchaser prior to the Closing,
that includes disclosure of events occurring or facts
arising after the date of this Agreement.
"Tax Return" means a report, return or other
information required to be supplied to a governmental entity
or body with respect to Taxes including, where permitted or
required, combined or consolidated returns for any group of
entities that includes the Company or any Subsidiary.
ARTICLE XI
Miscellaneous
11.1 Amendments. This Agreement may not be amended or
modified except by express written consent of the parties
hereto in an agreement or instrument of comparable
significance to this Agreement.
11.2 Assignment. Neither party may assign this
Agreement or its rights or obligations hereunder, whether by
operation of law or otherwise, to any third party without
the prior written consent of the other party.
11.3 Notices. All notices or communications hereunder
shall be sent by overnight mail by courier of nationally
recognized standing addressed as follows (or such other
address as such party may designate in writing):
To Chiron:
Chiron Corporation
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000-0000
Attention: Chief Executive Officer
Telefax: (000) 000-0000
With a copy to:
Chiron Corporation
0000 Xxxxxx Xxxxxx
Xxxxxxxxxx, Xxxxxxxxxx 00000-0000
Attention: General Counsel
Telefax: (000) 000-0000
To the Purchaser:
Bausch & Lomb Incorporated
Xxx Xxxxxx & Xxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: Chief Executive Officer
Telefax: (000) 000-0000
With a copy to:
Bausch & Lomb Incorporated
Xxx Xxxxxx & Xxxx Xxxxx
Xxxxxxxxx, Xxx Xxxx 00000
Attention: General Counsel
Telefax: (000) 000-0000
Any notice hereunder shall be effective upon receipt by the
intended recipient.
11.4 Severability. If any provision of this Agreement
shall be held to be invalid or otherwise unenforceable under
applicable law, such provision shall be deemed severed and
all other provisions shall nevertheless continue in full
force and effect; provided that the parties shall negotiate
in good faith to resolve any inequities created by such
partial unenforceability.
11.5 Counterparts. This Agreement may be executed in
counterparts, all of which together shall constitute one and
the same instrument.
11.6 Governing Law. This Agreement shall be governed
by and construed in accordance with the laws of the State of
California.
11.7 Interpretation. When a reference is made in this
Agreement to an Article, Section, Exhibit or Schedule, such
reference is to an Article or Section of, or an Exhibit or
Schedule to, this Agreement unless otherwise indicated. The
table of contents and headings contained in this Agreement
are for reference purposes only and shall not affect in any
way the meaning or interpretation of this Agreement.
Whenever the words "include," "includes" and
"including" are used in this Agreement, they are deemed to
be followed by the words "without limitation." For all
purposes of this Agreement, except as otherwise expressly
provided or unless the context otherwise requires, (a) the
terms defined include the plural as well as the singular,
(b) all accounting terms not otherwise defined herein have
the meanings assigned under GAAP, and (c) the words
"herein," "hereof" and "hereunder" and other words of
similar import refer to this Agreement as a whole and not to
any particular Article, Section or other subdivision.
11.8 Entire Agreement. This Agreement, together with
any agreement executed and delivered by the parties
concurrently herewith and the Schedules and Exhibits
attached hereto, constitutes the entire agreement between
the Purchaser and Chiron with respect to the subject matter
hereof. There are no representations, warranties, covenants
or undertakings with respect to the subject matter hereof
other than those expressly set forth herein. This Agreement
supersedes all prior agreements between the parties with
respect to the Stock purchased hereunder and the subject
matter hereof.
11.9 Publicity. The parties jointly will prepare a
news release or other announcement regarding this Agreement
and, subject to their respective legal obligations
(including requirements of the New York Stock Exchange and
other similar regulatory bodies), thereafter will consult
with each other regarding the text of any press release or
other public statement (including any filings with any
federal or state governmental or regulatory agency) relating
to the transaction contemplated by this Agreement prior to
any release or filing thereof.
11.10 Efforts; Further Assurances. Each party will
use its commercially reasonable efforts to cause all
conditions to its obligations hereunder to be timely
satisfied and to perform and fulfill all obligations on its
part to be performed and fulfilled under this Agreement, to
the end that the transactions contemplated by this Agreement
shall be effected substantially in accordance with its terms
as soon as feasible. The parties shall cooperate with each
other in such actions and in securing requisite approvals,
consents and authorizations. Each party shall execute and
deliver both before and after the Closing such further
certificates, agreements and other documents and take such
other actions as the other party may reasonably request as
may be necessary or appropriate to consummate or implement
the transactions contemplated hereby or to evidence such
events or matters. Each party agrees to cause its
subsidiaries to comply with any obligations hereunder
relating to such subsidiaries and to cause its subsidiaries
to take any other action which may be necessary or
reasonably requested by the other party in order to
consummate the transactions contemplated by this Agreement.
11.11 Expenses. Subject to Article VI and Article
IX, Chiron and the Purchaser shall each pay their own
expenses incident to the negotiation, preparation and
performance of this Agreement and the transactions
contemplated hereby, including but not limited to the fees,
expenses and disbursements of their respective investment
bankers, accountants and counsel. Any such expenses of
Company and the Subsidiaries shall be paid by Chiron on or
prior to the Closing.
IN WITNESS WHEREOF, this Agreement has been executed
and delivered as of the date first above written, by the
duly authorized representatives of the parties hereto.
BAUSCH & LOMB INCORPORATED
By:___________________________
Xxxxxxx X. Xxxxxxxxx
President and Chief
Executive Officer
By:___________________________
Xxxxxxx X. XxXxxxxx
Senior Vice President,
Finance
CHIRON CORPORATION
By:___________________________
Xxxxxx X. Xxxxxxx, Ph.D.
President and Chief
Executive Officer