AMENDMENT NO. 1
TO
RECAPITALIZATION AGREEMENT
AMENDMENT dated as of September 29, 1999 (this "Amendment")
to Recapitalization Agreement dated as of the July 25, 1999 (the
"Recapitalization Agreement") by and among Bausch & Lomb
Incorporated, a New York corporation ("Seller Parent') and CRL
Acquisition LLC, a Delaware limited liability company ("Buyer").
Capitalized terms used herein and not otherwise defined herein shall
have the meanings ascribed to them in the Recapitalization Agreement.
W I T N E S S E T H
WHEREAS, Seller Parent, Buyer, Sellers, Parent Canada,
Recap Co, Recap Subco and Buyer Parent have entered into the
Recapitalization Agreement; and
WHEREAS, the parties hereto desire to amend certain of the
provisions of the Recapitalization Agreement pursuant to Section 9.11
thereof as more particularly described below.
NOW, THEREFORE, in consideration of the foregoing and for
other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, and intending to be legally bound
hereby, the parties hereto hereby agree as follows:
ARTICLE I.
AMENDMENTS TO RECAPITALIZATION AGREEMENT
1.1 The parties hereto acknowledge and agree that Section
2.1 of the Recapitalization Agreement is hereby amended by deleting
it in its entirety and replacing it with the following:
"2.1 Reorganization and Stock Split. Upon the terms and
subject to the conditions of this Agreement, the parties agree that
the following transactions will take place immediately prior to the
Closing in the order set forth below (with the steps set forth in
Section 2.1.2 through 2.1.5 being hereinafter referred to as the
"Stage 2 Reorganization"):
2.1.1 Recap Co shall redeem 29,000 shares of Recap Co Common
Stock owned by Recap Subco in exchange for $1.00.
2.1.2 Recap Subco shall form a wholly owned Canadian Corporation
("NewCanCo").
2.1.3WPLP shall contribute all of its CRL Business Assets
used in the CRL Business to Recapo Subco and, in exchange therefor,
Recap Subco shall issue to WPLP the Recap Subco Preferred Stock
pursuant to a contribution agreement in substantially the form of the
Contribution Agreements.
2.1.4 CRL shall purchase shares of Recap Subco Common Stock
in exchange for cash and Recap Subco shall purchase shares of
NewCanCo common stock in exchange for cash.
2.1.5 Parent Canada shall sell all of its CRL Business
Assets used in the CRL Business to NewCanCo in exchange for cash
pursuant to an Asset Purchase Agreement in substantially the form of
the Contribution Agreements.
2.1.6 Each of CRL, SPAFAS, and International shall exchange
all of the Recap Subco Common Stock owned by it for the same number
of shares of Recap Co Common Stock and WPLP shall exchange all of the
Recap Subco Preferred Stock for the same number of shares of Recap Co
Preferred Stock."
2.1.7 Recap Co shall redeem 1,000 shares of Recap Co Common
Stock owned by Recap Subco in exchange for $1.00.
2.1.8 Recap Co shall, by way of a stock dividend, effect a stock
split of the issued and outstanding shares of Recap Co Common Stock
by declaring and paying a stock dividend of 46.6190509259 shares of
Recap Co Common Stock in respect of each issued and outstanding share
of Recap Co Common Stock (the "Stock Split").
2.1.9 Buyer shall form a wholly owned Delaware corporation
("Acquisition Co") and contribute at least $90,000,000 thereto in
exchange for shares of common stock of Acquisition Co."
1.2 (a) The parties hereto acknowledge and agree that
Section 2.3 of the Recapitalization Agreement is hereby amended by
deleting the caption thereto in its entirety and replacing such
caption with the following: "Redemptions; Merger."
(b) The parties hereto acknowledge and agree that Section
2.3 of the Recapitalization Agreement is hereby amended by deleting
Section 2.3.4 thereof in its entirety and replacing such Section
2.3.4 with the following:
"2.3.4 Recap Co shall redeem 5,227,167 shares of Recap Co
Common Stock owned by CRL for $50,000,000 in cash, payable by wire
transfer of immediately available funds to such account as is
designated by CRL, and $43,000,000 in principal amount of the Recap
Co Sub Note, and CRL shall deliver to Recap Co certificates, duly
endorsed for transfer, representing such shares of Recap Co Common
Stock."
(c) The parties hereto acknowledge and agree that Section
2.3 of the Recapitalization Agreement is hereby amended by adding a
new Section 2.3.5 thereof to read in its entirety as follows:
"2.3.5 Buyer and Seller Parent shall cause Acquisition Co
to merge with and into Recap Co with Recap Co being the surviving
entity (the "Merger"). At the effective time of the Merger, (i) CRL
shall receive, as the sole shareholder of Recap Co, in exchange for
each one share of the 5,058,548 shares of Recap Co Common Stock
issued and outstanding immediately prior to the effective time of the
Merger, $17.7916666996 and .254166808341 shares of Recap Co Common
Stock as the surviving corporation in the Merger, and (ii) Buyer
shall receive 9,000,000 shares of Recap Co Common Stock in exchange
for all of the issued and outstanding shares of Acquisition Co common
stock, constituting 87.5% of the total number of shares of Recap Co
Common Stock issued and outstanding following all of the Redemptions
and the Merger, including the number of shares so issued. The
parties acknowledge that the Merger will be treated for tax purposes
as a qualified stock purchase within the meaning of section 338(d)(3)
of the Internal Revenue Code, section 1.338-1(c)(8) of the
regulations thereunder and Rev. Rul. 90-95, 1990-2 C.B. 67."
(d) The parties hereto acknowledge and agree that Section
2.3 of the Recapitalization Agreement is hereby amended by
renumbering Section 2.3.5 as Section 2.3.6.
1.3 The parties hereto acknowledge and agree that Section
5.5.5 of the Recapitalization Agreement is hereby amended by deleting
the phrase ", at the Closing," in the third sentence of Section 5.5.5
and replacing such phrase with the following:
",within sixty (60) calendar days after the Closing,"
1.4 The parties hereto acknowledge and agree that Section
8.3 of the Recapitalization Agreement is hereby amended by deleting
clause 8.3(d) thereof in its entirety and replacing such clause with
the following:
"(d) the conduct of the CRL Business after the Closing Date
except to the extent the Losses or Litigation Expense resulted from
the conduct of the CRL Business prior to the Closing Date. Any
indemnity payable pursuant to Section 8.3(a) or Section 8.3(b) (but
only with respect to the covenants and agreements, contained in
Section 5.15), shall be increased by an amount equal to the product
of (i) such Loss and Litigation Expense and (ii) the Seller's Equity
Percentage at the time."
1.5 The parties hereto acknowledge and agree that Section
8.5 of the Recapitalization Agreement is hereby amended by deleting
the fifth sentence thereof in its entirety and replacing such
sentence with the following:
"The Indemnitor may not settle or compromise any Claim
without the prior written consent of Indemnitee except for settlement
or compromise of a Claim (i) which includes the unconditional release
by the Person asserting the Claim and any related claimants of
Indemnitee from all liability with respect to such Claim in form and
substance reasonably satisfactory to Indemnitee, (ii) which would not
adversely affect the Indemnitee and its Affiliates to own, hold use
and operate their respective assets and businesses, and (iii) for
money damages only."
1.6 The parties hereto acknowledge and agree that Section
9.3 of the Recapitalization Agreement is hereby amended by deleting
the first sentence thereof in its entirety and replacing such
sentence with the following:
"All excise, sales, use, transfer, stamp, documentary,
filing, recording and other similar taxes or fees which may be
imposed or assessed as the result of the transactions contemplated
hereby, including, without limitation, the Merger and Redemptions
("Transfer Taxes"), together with any interest or penalties with
respect thereto, shall be shared by the Seller Parent and Recap Co as
follows: the first $100,000 shall be paid by Seller Parent, the
second $100,000 shall be paid by Recap Co, and all amounts in excess
of $200,000 shall be paid 50% by Recap Co and 50% by Seller Parent."
ARTICLE II.
MISCELLANEOUS
2.1 Invalidity, Etc. The provisions of this Amendment
shall be deemed severable and the invalidity or unenforceability of
any provision shall not affect the validity or enforceability of the
other provisions hereof. If any provision of this Amendment, or the
application thereof to any Person or any circumstance, is invalid or
unenforceable, (a) a suitable and equitable provision shall be
substituted therefor in order to carry out, so far as may be valid
and enforceable, the intent and purpose of such invalid or
unenforceable provision and (b) the remainder of this Amendment and
the application of such provision to other persons, entities or
circumstances shall not be affected by such invalidity or
unenforceability.
2.2 Governing Law. This Amendment shall be governed by,
and construed in accordance with, the laws of the State of New York
without regard to the conflicts of laws principles thereof.
2.3 Recitals. The section headings contained in this
Amendment are for reference purposes only and shall not affect the
meaning or interpretation of this Amendment.
2.4 Counterparts. This Amendment may be executed in
counterparts, each of which shall be deemed an original, but all of
which taken together shall constitute one and the same instrument.
2.5 Ratification. The parties hereto hereby ratify and
approve the Recapitalization Agreement, as amended hereby, and the
parties hereto acknowledge that all of the terms and provisions of
the Recapitalization Agreement as amended hereby, are and remain in
full force and effect.
* * *
IN WITNESS WHEREOF, the parties hereto have caused this
Amendment to be executed as of the date first above written.
BAUSCH & LOMB, INCORPORATED
By:
Name: Xxxx X. Xxxxxxxxxx
Title: Vice President-
Business Development
CRL ACQUISITION LLC
By:
Name:Xxxx Xxxxxx
Title: President
