Exhibit 4a(ii)
AGREEMENT
dated 20 March 2003
between
Xxxxx & Nephew plc
00 Xxxx Xxxxxx, Xxxxxx XX0X 0XX ("Xxxxx & Nephew")
and
Meadowclean Limited
(in the process of re-registering as a UK registered public
company changing its name to Xxxxx & Nephew Group plc) (the "Offeror")
and
Centerpulse Ltd
Xxxxxxxxxxxxxx 00, 0000 Xxxxxx (the "Company")
relating to
the Combination of Xxxxx & Nephew and the Company
TABLE OF CONTENTS
I PUBLIC OFFER .......................................................... 5
1 Structure ......................................................... 5
2 Offer Restrictions ................................................ 5
3 Offer Price ....................................................... 6
4 Conditions ........................................................ 7
5 Offeror's and Xxxxx & Nephew's Obligations ........................ 8
6 Company's Obligations ............................................. 9
7 Board Approvals ................................................... 10
8 Corrections to Offer Documents .................................... 10
9 Rights Under Stock Option Plans ................................... 10
II COVENANTS ............................................................. 11
1 Board Representation .............................................. 11
2 Company's Manufacturing Facilities ................................ 11
3 Management ........................................................ 11
4 Listing ........................................................... 11
5 No Solicitation ................................................... 11
6 Co-operation; Confidentiality ..................................... 12
7 Cost Reimbursement ................................................ 12
8 Conduct of Business ............................................... 13
9 Reasonable Efforts; Filings ....................................... 14
10 Notification of Certain Matters ................................... 14
III TERMINATION AND AMENDMENT ............................................. 14
1 Termination ....................................................... 14
2 Effect of Termination ............................................. 15
3 Amendment ......................................................... 15
IV MISCELLANEOUS ......................................................... 16
1 Waiver of Standstill Provisions ................................... 16
2 Entire Agreement; Assignment ...................................... 16
3 Validity .......................................................... 16
4 Notices ........................................................... 16
5 Fees and Expenses ................................................. 17
6 Public Disclosure ................................................. 17
7 Governing Law ..................................................... 18
8 Arbitration ....................................................... 18
Combination Agreement -3-
--------------------------------------------------------------------------------
TABLE OF ANNEXES
Annex I.4 a): Form of Pre-Announcement
Annex 1.7 a): Fairness Opinion of each of UBS Warburg and Xxxxxx Brothers to
the Board of Directors of the Company
Combination Agreement -4-
--------------------------------------------------------------------------------
RECITALS
WHEREAS, the board of directors of each of Xxxxx & Nephew and the Company has
determined that in light of the potential benefits from a strategic combination
of their respective businesses it is in the best interests of their respective
shareholders for the Offeror, the proposed new holding company of Xxxxx &
Nephew, which will be a UK registered public company, resident in Switzerland
and listed on the London Stock Exchange and on the SWX Swiss Exchange, to
acquire control of the Company upon the terms and subject to the conditions set
forth in this agreement (this "Agreement");
WHEREAS, the boards of directors of Xxxxx & Nephew and the Offeror have adopted
resolutions (a) approving the acquisition of the Company by the Offeror, this
Agreement and the transactions contemplated hereby, and (b) (in the case of
Xxxxx & Nephew only) recommending that the shareholders of Xxxxx & Nephew
approve this Agreement and the transactions contemplated hereby;
WHEREAS, the board of directors of the Company has obtained fairness opinions
and adopted resolutions (a) approving the acquisition of the Company by the
Offeror, this Agreement and the transactions contemplated hereby, and (b)
recommending to the Company's shareholders to tender their shares in the Offer
(as defined herein);
WHEREAS, Incentive Capital AG, an investment company organized under the laws of
Switzerland and listed on the SWX Swiss Exchange (the "Shareholder"), holds
indirectly through its wholly-owned subsidiary Incentive Jersey Ltd, 13.14% of
the Company Shares (as defined herein) and rights to acquire further 5.77% of
the Company Shares, Xxxxx & Nephew and the Shareholder have agreed, by way of a
separate transaction agreement dated the date hereof, that the Offeror shall
acquire all the outstanding shares of the Shareholder by way of a public offer
(the "Parallel Public Offer"), which is to be launched and conducted in parallel
to the Offer with respect to the Company;
WHEREAS, the Offeror, Xxxxx & Nephew and the Company desire to make certain
arrangements and covenants in relation to the Offer contemplated in this
Agreement;
NOW THEREFORE, in consideration of the mutual covenants and agreements set forth
herein, the parties agree as follows:
Combination Agreement -5-
--------------------------------------------------------------------------------
I PUBLIC OFFER
1 Structure
a) The Offeror agrees to extend a public offer to purchase all
outstanding registered shares of the Company, each with a nominal
value of CHF 30.00 (the "Company Shares"; including the Company Shares
represented by the American Depositary Shares of the Company (the
"Company ADSs"), which are currently issued and which will have been
issued by the end of the additional acceptance period (the
"Transaction"), against payment of a consideration consisting of
shares of the Offeror (the "Offeror Shares") to be issued credited as
fully paid and ranking pari passu in all respects with the Offeror
Shares in issue at the date hereof, and/or cash as further described
in Section I.3.
b) The Company agrees that no Company Shares held by the Company or any
of its subsidiaries, if any, will be tendered pursuant to the Offer;
provided, however, that prior to the date of settlement of the Offer
(the "Completion Date"; Vollzugsdatum in German) Company Shares held
by the Company may be allocated, issued, delivered or transferred
pursuant to the Company's stock incentive plan for management and
employees in accordance with the terms thereof or Section I.9.
2 Offer Restrictions
a) The offer contemplated by the Transaction will be made available to
all shareholders on substantially the same terms and conditions and
will take the form of a public exchange offer applicable to all
shareholders (the "Offer") but for regulatory reasons will be
conducted utilising two separate sets of offer documents: (i) one set
to be made available to all holders of Company Shares not located in
the United States and prepared in accordance with the Swiss Stock
Exchanges and Securities Trading Act ("SESTA") and its implementing
rules and regulations and (ii) the other set to be made available to
all shareholders located in the United States and prepared in
accordance with the Securities Exchange Act of 1934, as amended (the
"US Exchange Act"), and the Securities Act of 1933, as amended (the
"US Securities Act"), in each case, and the rules and regulations
thereunder.
b) The Offer contemplated by this Agreement is not being made directly or
indirectly, nor is it intended to extend to, a country or jurisdiction
where such public offer would be considered unlawful or in which it
would otherwise breach any applicable law or regulation or which would
require the Offeror to amend any term or conditions of the Offer in
any way or which would require the Offeror to make
Combination Agreement -6-
--------------------------------------------------------------------------------
any additional filings with, or take any additional action with
regards to, any governmental, regulatory or legal authority. Offering
documents relating to the Offer may not be distributed in nor sent to
such country or jurisdiction and may not be used for the purposes of
soliciting the exchange of any securities of the Company from anyone
in such country or jurisdiction.
3 Offer Price
a) The consideration will be paid in Offeror Shares and cash on the basis
of (i) an exchange ratio (the "Exchange Ratio") of 25.15 Offeror
Shares and CHF 73.42 in cash for each Company Share. The Exchange
Ratio will be adjusted to compensate for any dilutive effects in
respect of the Company Shares or ordinary shares in Xxxxx & Nephew
(the "Xxxxx & Nephew Shares") (save for shares issued for management
options issued under the Company or Xxxxx & Nephew employee share
schemes and disclosed in the Company's or Xxxxx & Nephew's financial
statements for the financial year 2002) including dividend payments
(save for dividends already declared by Xxxxx & Nephew or an interim
dividend thereafter declared by Xxxxx & Nephew in the normal course
consistent with past practice), capital increases below market value,
or the issuance of options (save for management options issued under
Xxxxx & Nephew employee share schemes in the normal course consistent
with past practice), warrants, convertible securities and other rights
of any kind to acquire Company Shares or Xxxxx & Nephew Shares, or any
other transaction (including in connection with a scheme of
arrangement) having a dilutive effect on the value of the Offers
unless provided otherwise herein. If between the date of this
Agreement and the Completion Date, the outstanding Xxxxx & Nephew
Shares shall have been changed into a different number of shares or a
different class, by reason of the occurrence or record date of any
stock dividend, subdivision, reclassification, recapitalisation,
split, combination, exchange of shares or similar transaction, the
Exchange Ratio shall be appropriately adjusted to reflect such stock
dividend, subdivision, reclassification, recapitalisation, split,
combination, exchange of shares or similar transaction made until the
Completion Date.
Fractions of Offeror Shares will not be issued and entitlements to
Offeror Shares will be rounded down to the nearest whole Offeror Share
and the cash element of the consideration will be adjusted.
b) In respect of the cash consideration, a `mix and match' facility will
be made available. Accepting Company Shareholders under the Offer and
accepting shareholders of the Shareholder under the Parallel Public
Offer (together the "Accepting Shareholders") may elect to take fewer
Offeror Shares or more Offeror Shares than their basic entitlement
under the relevant Offer, but elections under both Offers (taken
together) to take more Offeror Shares (together the "Excess Shares")
will only be satisfied to the extent that elections have been made
under the Offer
Combination Agreement -7-
--------------------------------------------------------------------------------
and the Parallel Public Offer (taken together) by Accepting
Shareholders to take fewer Offeror Shares (together referred to as
"Available Shares"). The Available Shares will be allocated to the
applicants for Excess Shares in proportion to the number of Excess
Shares applied for. If the total number of Available Shares exceeds
the total number of Excess Shares applied for, the Available Shares
shall be limited to an amount equal to the Excess Shares. Once the
share allocations have been determined, the cash element of the
consideration will be reduced or increased (as the case may be) for
each Accepting Shareholder who has been allocated an increased or
reduced number of Offeror Shares. All calculations shall be made by
reference to the number of acceptances and elections as of the last
day of the additional acceptance period.
4 Conditions
a) The obligation of the Offeror to complete the Offer and to accept for
payment and to pay for the Company Shares tendered pursuant thereto
shall be subject only to those conditions (the "Conditions") set forth
in the pre-announcement in the form as attached hereto in Annex I.4 a)
(the "Pre-Announcement"). Each of the Offeror, Xxxxx & Nephew and the
Company shall use its reasonable efforts (alle zumutbaren Massnahmen)
to satisfy the respective Conditions as soon as practicable and to
recommend the steps to be taken by its shareholders in relation
thereto.
b) The Conditions shall be suspensive conditions within the meaning of
art. 13 para. 1 of the Ordinance of the Takeover Board on Public
Takeover Offers ("TOO"). The Offeror reserves the right to waive or
relax any of the Conditions (save for Conditions 1, 2, 3 as to the
requirement to obtain merger clearance as such, and 4) in whole or in
part. If and to the extent the regulatory Conditions are not met or
waived by the end of the initial offer period and provided that the
non-regulatory Conditions are satisfied or capable of being satisfied,
the Offeror will be obliged to have the offer period extended on one
or several occasions for such a period as will permit determination of
the issue in question. Subject to the preceding sentence, if and to
the extent the Conditions are not met or waived by the end of the
(possibly extended) offer period, the Offeror reserves the right to
terminate the Offer or to obtain the approval by the Swiss Takeover
Board ("STOB") for an extension of the offer period. The Company
agrees to consent to such extension requests.
The Offer will expire if the Conditions have not been fulfilled or
waived upon expiry of the (possibly extended) offer period and no
further extension of the offer period has been granted by the STOB.
For the avoidance of doubt, due to US legal considerations, holders of
Company Shares that have tendered any of their Company Shares pursuant
to the Offer
Combination Agreement -8-
--------------------------------------------------------------------------------
shall have the right to withdraw such Company Shares until the end of
the (possibly extended) offer period.
c) The parties acknowledge that the "Court Scheme" referred to in the
Pre-Announcement refers to a scheme of arrangement under section 425
of the Companies Xxx 0000 of the United Kingdom pursuant to which:
(i) the existing ordinary shares in Xxxxx & Nephew shall be
cancelled; and
(ii) the Offeror shall issue Offeror Shares to existing shareholders
of Xxxxx & Nephew in consideration of the issue to the Offeror of
ordinary shares in Xxxxx & Nephew (on the basis of one Offeror
Share for each existing ordinary share in Xxxxx & Nephew),
as described in draft (2) of the memorandum produced by Ashurst Xxxxxx
Xxxxx dated 15 March 2003 entitled "Project Mango Transaction
Structure" (the "AMC Paper") but subject to further amendment to
comply with legal, commercial and tax issues, provided that any such
amendment is not, or would not reasonably likely be, prejudicial to
the Company or its shareholders, or will not, or would not be
reasonably likely to, substantially delay the date on which the Offer
is expected to become unconditional or substantially prejudice the
likelihood of the Offer becoming unconditional.
The Offeror and Xxxxx & Nephew agree that the Court Scheme shall not
be conditional upon any matter save for any condition expressly set
out in the Pre-Announcement and any shareholder approval of Xxxxx &
Nephew required by law to approve the Court Scheme. In particular, but
without limitation, the Court Scheme shall not be conditional upon, or
include as part of its terms, the proposed repayment by way of
cancellation of the preference shares referred to in the AMC Paper.
5 Offeror's and Xxxxx & Nephew's Obligations
The Offeror and/or Xxxxx & Nephew (as applicable) shall procure that any of
the following be done and/or shall:
a) make the Pre-Announcement not later than 20 March 2003 and prepare any
offer documents and instruments pursuant to which the Offer will be
made (collectively with any supplements or amendments thereto,
including the U.S. Offer Documents as defined below the "Offer
Documents"), it being understood that the Company and its counsel
shall be given a reasonable opportunity to review and comment on the
Offer Documents and any other documents pertinent to the Transaction
prior to filing or distribution thereof and that each party (acting
reasonably) must be satisfied with the description of any matters
relating to itself (including its business) in any of these documents;
Combination Agreement -9-
--------------------------------------------------------------------------------
b) prepare and make all anti-trust or other filings necessary to carry
out the transactions contemplated by this Agreement;
c) prepare and publish listing particulars in relation to the Offeror
Shares in accordance with the Listing Rules of the United Kingdom
Listing Authority (the "UK Listing Rules") and post such listing
particulars to the Company's shareholders together with the Offer
Documents;
d) prepare and post to Xxxxx & Nephew's shareholders a circular complying
with the UK Listing Rules and containing (i) a recommendation of the
directors of the Offeror to vote in favour of the resolutions of Xxxxx
& Nephew referred to in the Conditions and (ii) an explanatory
statement pursuant to section 426 of the Companies Xxx 0000 of the
United Kingdom;
e) use commercially reasonable endeavours promptly to prepare, publicize,
distribute, file and submit any documents, listing particulars,
announcements, submissions and any other form of communication to be
made; and
f) file with the SEC on or prior to the date of commencement of the Offer
(i) a Tender Offer Statement on Schedule TO (together with any
amendments or supplements thereto, the "Schedule TO"), (ii) the
Exchange Offer Registration Statement with respect to the Offer and
(iii) a Registration Statement on Form F-6 (the "ADS Registration
Statement") registering the American Depositary Shares of the Offeror
(the "Offeror ADSs") to be issued in connection with the Transaction
(the Schedule TO, the Exchange Offer Registration Statement, the ADS
Registration Statement and such other documents included therein
pursuant to which the US Offer will be made, the "U.S. Offer
Documents").
6 Company's Obligations
The Company shall:
a) provide to the Offeror such information as reasonably requested in
connection with the preparation of the listing particulars and the
Offer Documents;
b) ensure that the Offer Documents will contain a report of the board as
per Section 29(1) SESTA recommending acceptance of the Offer, it being
understood, however, that the board of the Company will be under no
obligation to recommend the Offer if Xxxxx & Nephew or the Offeror
should become subject to the events referred to in Condition 7 mutatis
mutandis in relation to Xxxxx & Nephew's products, or its facilities
in Hull or Memphis;
Combination Agreement -10-
--------------------------------------------------------------------------------
c) file with the SEC contemporaneously with the commencement of the Offer
and disseminate to holders of the Company Shares, in each case as and
to the extent required by the US Exchange Act, a
Solicitation/Recommendation Statement on Schedule 14D-9 (together with
any amendments or supplements thereto) that shall reflect the
recommendation of the board of directors of the Company.
7 Board Approvals
a) The Company confirms that its board of directors has (a) obtained
fairness opinions issued by its financial advisors UBS Warburg and
Xxxxxx Brothers enclosed as Annex I.7.a), and (b) by way of a board
resolution (i) determined that this Agreement and the transactions
contemplated hereby are fair to, and in the best interests of, the
Company's shareholders, (ii) approved this Agreement, and (iii)
resolved to recommend to the shareholders acceptance of the Offer. The
Company has been advised by its board members and executive officers
(members of executive committee) that they intend to tender all
Company Shares owned by them to the Offeror pursuant to the Offer.
b) Each of Xxxxx & Nephew and the Offeror confirms that its board of
directors (i) determined that this Agreement and the transactions
contemplated hereby are in the best interests of itself and its
shareholders as a whole, (ii) approved this Agreement, and (iii) (in
the case of Xxxxx & Nephew only) resolved unanimously to recommend to
its shareholders the approval of the transactions contemplated by this
Agreement.
8 Corrections to Offer Documents
Each party hereto shall notify the other parties if any of the information
supplied by that party to either of the other parties for inclusion in any
of the Offer Documents becomes false or misleading in any material respect
and supply the information needed to correct the misstatement.
9 Rights Under Stock Option Plans
a) The holders of the Company's outstanding stock options relating to
Company Shares will receive stock options relating to Offeror Shares
(the "New Options") at an exchange ratio of 34 : 1 (no cash
component). The New Options will vest 30 days after completion of the
Offer, and the exercise period will be 18 months. The strike price of
the New Options will be calculated by dividing the existing strike
price of the option by 34 and converting this into GBP at the
prevailing exchange rate at the Completion Date.
Combination Agreement -11-
--------------------------------------------------------------------------------
b) Xxxxx & Nephew and the Offeror shall take all steps necessary and
procure the required approvals to roll over Xxxxx & Nephew's share
options into the Offeror to the extent such options are capable of
rollover.
II COVENANTS
1 Board Representation
The Offeror will take all action necessary to ensure independent
non-executive representation of the Company by two persons on the Offeror's
board, it being understood that Dr. Xxx Xxxx is invited to join the board
of the Offeror as a Vice Chairman and Xxxx Xxxxxxxxx is invited to join the
board of the Offeror as a director.
2 Company's Manufacturing Facilities
The Offeror and Xxxxx & Nephew each intends the Winterthur facility
continuing to be an important centre of the combined group for a number of
years.
3 Management
The Offeror and Xxxxx & Nephew will each use its reasonable endeavours to
offer senior operating management of the Company suitable posts in the
combined group.
4 Listing
The Offeror and Xxxxx & Nephew will each use its reasonable best efforts to
obtain a secondary listing of the Offeror Shares on the SWX Swiss Exchange
as of the Completion Date.
5 No Solicitation
a) The Company agrees that it shall immediately cease and cause to be
terminated all existing discussions, negotiations and communications
with any persons with respect to any Acquisition Transaction (as
defined below). The Company agrees that it shall not solicit or
initiate any discussions or negotiations with any corporation,
partnership, person or other entity or group (other than Xxxxx &
Nephew or any affiliate or associate of Xxxxx & Nephew) concerning any
merger, consolidation, business combination, liquidation,
reorganization, sale of substantial assets, sale of shares of capital
stock or similar transactions involving the Company or any material
subsidiary of the Company (each an "Acquisition Transaction"); pro-
Combination Agreement -12-
--------------------------------------------------------------------------------
vided, however, that nothing contained in this Section II.5 shall
prohibit the Company or its board of directors from taking and
disclosing to the Company's shareholders, or any third parties or
governmental or regulating bodies, a position with respect to an
Acquisition Transaction initiated by a third party or from making such
other disclosure to the Company's shareholders, or any third parties
or governmental or regulating bodies, which, as advised by outside
counsel, is advisable under applicable law.
b) The Company shall promptly advise Xxxxx & Nephew of the Company's
receipt of any proposal relating to an Acquisition Transaction and any
request for information that may reasonably be expected to lead to or
is otherwise related to any Acquisition Transaction, the identity of
the person making such proposal relating to an Acquisition Transaction
or request for information and, subject to applicable law and the
requirements of any regulatory authorities, the terms and conditions
of such proposal relating to an Acquisition Transaction.
6 Co-operation; Confidentiality
a) From the date hereof until the Completion Date, the Company agrees to
cooperate with the Offeror and Xxxxx & Nephew in their efforts to
develop high-level integration plans to facilitate a rapid combination
of the operations upon completion of the Transaction.
b) All information obtained by the Offeror, Xxxxx & Nephew or their
representatives pursuant to this Section 6 shall be kept confidential
in accordance with the confidentiality agreement, dated 19 December
2002 (the "Confidentiality Agreement"), between Xxxxx & Nephew and the
Company.
7 Cost Reimbursement
a) The parties agree on a fixed compensation sum of CHF 20 million (the
"Cost Reimbursement") as further set out in Sub-Sections II.7 b) and
c) in the event that the Transaction is pre-announced but not
completed. Such fixed compensation sum shall represent a lump sum
payment for the purpose of compensating the recipient for damages for
internal expenditures and external costs and lost revenues incurred in
connection with the preparation for and in consideration of the
realization of the combination of the businesses of Xxxxx & Nephew and
the Company, and is not intended in any way whatsoever to coerce a
party into completing the Transaction.
b) Xxxxx & Nephew will pay the Cost Reimbursement to the Company if the
non-completion of the Transaction is attributable to (i) the failure
of Xxxxx & Nephew
Combination Agreement -13-
--------------------------------------------------------------------------------
or its board of directors to recommend this Agreement and the
transactions contemplated by this Agreement to its shareholders or the
withdrawal or the modification of such recommendation, (ii) the
failure of Xxxxx & Nephew or the Offeror (as appropriate) to publish
the Pre-Announcement as agreed herein (save for modifications required
by the STOB) or any other material breach of this Agreement by Xxxxx &
Nephew or the Offeror, (iii) the material contravention of Xxxxx &
Nephew or the Offeror of any material laws and regulations that apply
to the Offer, or (iv) the non-satisfaction of any of the Conditions
(1), (2) or (4).
c) The Company will pay the Cost Reimbursement to Xxxxx & Nephew if the
non-completion of the Transaction is attributable to (i) the failure
of the Company or its board of directors to recommend the Offer to its
shareholders or the withdrawal or the modification of the
Recommendation, (ii) the material contravention of the Company of any
material laws and regulations that apply to the Offer, (iii) a
material breach of this Agreement by the Company, or (iv) the
non-satisfaction of any of the Conditions (6) or (7) or the successful
completion of a competing public offer by a third party, it being
understood, however, that if the Offeror or Xxxxx & Nephew becomes
subject to an event referred to in Condition 7 mutatis mutandis in
relation to Xxxxx & Nephew's products, or its facilities in Hull or
Memphis, the Company will not have to pay any Cost Reimbursement.
8 Conduct of Business
Except as contemplated by this Agreement, during the period from the date
of this Agreement to the Completion Date, each of the Company, Xxxxx &
Nephew and their respective subsidiaries will conduct its operations
according to its ordinary and usual course of business and consistent with
past practice and will use all reasonable efforts consistent with prudent
business practice to preserve intact the business organization, to keep
available the services of its current officers and key employees and to
maintain existing relationships with those having significant business
relationships with the respective party and its subsidiaries, in each case
in all material respects. By way of amplification and not limitation,
neither the Company nor any of its subsidiaries shall between the date
hereof and the Completion Date without the prior written consent of Xxxxx &
Nephew, which is not to be unreasonably withheld, do or propose to do any
of the following, except to the extent contemplated by this Agreement:
a) change the articles of association, with the exception of the changes
proposed to the shareholders of the Company in the invitation to the
Company's AGM of 30 April 2003;
b) make improvements to the employment contracts or other arrangements
with their directors or officers;
Combination Agreement -14-
--------------------------------------------------------------------------------
c) amend or terminate or enter into any material contracts;
d) initiate or agree on acquisitions or divestitures or financing,
financial, capital market transactions of more than CHF 70 million in
aggregate or dispose of, in whole or in part , its orthopedics,
spine-tech or dental divisions;
e) issue any shares (save for shares issued for management options issued
under the Option Plans and disclosed in the Company's financial
statements for the financial year 2002), options, warrants,
convertible securities or other rights of any kind to acquire Company
Shares; and
f) purchase any Company Shares for the period from the publication of the
public announcement until the Completion Date; and
g) distribute, either directly or indirectly (e.g. by share buy backs),
any dividend or other distribution to its shareholders.
9 Reasonable Efforts; Filings
Subject to the terms and conditions herein provided for and to the
fiduciary duties of the board of directors of the Company under applicable
law as advised by legal counsel, each of the parties hereto agrees to use
all reasonable efforts to take, or cause to be taken, all appropriate
action, and to do, or cause to be done, all things necessary, proper or
advisable under applicable laws and regulations, including without
limitation to make all national filings under applicable competition laws,
to complete and make effective, as soon as practicable, the transactions
contemplated by this Agreement.
10 Notification of Certain Matters
The Company shall give prompt notice to Xxxxx & Nephew, and Xxxxx & Nephew
shall give prompt notice to the Company, of any failure of such party (or,
in the case of Xxxxx & Nephew, the Offeror) to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied by it
hereunder.
III TERMINATION AND AMENDMENT
1 Termination
This Agreement may be terminated:
Combination Agreement -15-
--------------------------------------------------------------------------------
a) At any time by mutual written consent of the boards of directors of
the Company and Xxxxx & Nephew;
b) by Xxxxx & Nephew (i) in the event of a material breach of the
Agreement (which, for the avoidance of doubt, shall include any breach
of Sections II.8 d), f) and g)) or a material contravention of the
applicable laws and regulations by the Company, (ii) if the Company's
board of directors withdraws or otherwise modifies the Recommendation,
or (iii) if the Offer is not completed due to the non-satisfaction of
a Condition;
c) by the Company (i) in the event of a material breach of this Agreement
or a material contravention of the applicable laws and regulations by
the Offeror or Xxxxx & Nephew, (ii) if the Offer is not completed due
to the non-satisfaction of a Condition, or (iii) if the Company
receives an offer with respect to an Acquisition Transaction with a
party other than the Offeror or its affiliates or such other party has
commenced a tender offer which, in either case, the board of directors
of the Company, after having granted the Offeror the reasonable
opportunity to increase the value of the Offer, believes in good faith
is more favourable to the Company's shareholders than the transactions
contemplated by this Agreement.
2 Effect of Termination
a) If this Agreement is terminated pursuant to Section III.1 above, this
Agreement, except for the provisions of this Section and Sections
II.6(b), II.7 and IV hereof, shall forthwith become void and have no
effect, without any liability on the part of any party or its
directors, officers or shareholders. However, nothing in this Section
III.2 shall relieve any party to this Agreement of liability for
breach of this Agreement or for a contravention of the applicable laws
and regulations.
b) The Confidentiality Agreement shall remain in full force and effect
following any termination of this Agreement, and all confidential
material shall be either destroyed or returned promptly.
3 Amendment
This Agreement may not be amended except by an instrument in writing signed
on behalf of all of the parties.
Combination Agreement -16-
--------------------------------------------------------------------------------
IV MISCELLANEOUS
1 Waiver of Standstill Provisions
Whereas the Offeror and Xxxxx & Nephew are entering into separate
acquisition agreements in relation to the Company Shares under the Parallel
Public Offer, and whereas under the terms of subparagraph 7 of the
Confidentiality Agreement, the accompanying side letter agreement dated
December 19, 2002 and section 4(b) of the process letter from the Company's
financial advisors to Xxxxx & Nephew's financial advisor dated January 29,
2003 (together the "Standstill Provisions"), Xxxxx & Nephew has agreed not
to acquire, directly or indirectly, any Company Shares without the prior
approval of the Company, the Standstill Provisions are hereby waived (1)
with respect to Company Shares indirectly acquired in connection with the
exchange offer by the Offeror with respect to the Shareholder, and (2) with
respect to purchases made pursuant to the Offer.
2 Entire Agreement; Assignment
Except for the Confidentiality Agreement, this Agreement (a) constitutes
the entire agreement between the parties with respect to the subject matter
hereof and supersedes all other prior agreements and understandings, both
written and oral, between the parties with respect to the subject matter
hereof, (b) shall not be assigned by operation of law or otherwise and (c)
shall not be for the benefit of a third party.
3 Validity
The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provisions of this
Agreement, which shall remain in full force and effect.
4 Notices
All notices, requests, claims, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given when
delivered in person, by facsimile transmission with confirmation of
receipt, or by registered or certified mail (postage prepaid, return
receipt requested) to the respective parties as follows:
Combination Agreement -17-
--------------------------------------------------------------------------------
if to the Offeror or Xxxxx & Nephew:
Xxxxx Xxxxx
00 Xxxx Xxxxxx
Xxxxxx XX0X 0XX
For the attention of: Company Secretary
if to the Company:
Centerpulse Ltd
Xxxxxxxxxxxxxx 00
XX-0000 Xxxxxx
For the attention of: Company Secretary
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above
(provided that notice of any change of address shall be effective only upon
receipt thereof).
5 Fees and Expenses
Whether or not the Offer is consummated, all costs and expenses incurred in
connection with the transactions contemplated by this Agreement shall be
paid by the party incurring such expenses, except as provided expressly to
the contrary herein.
6 Public Disclosure
The Offeror and Xxxxx & Nephew (and their affiliates) and the Company (and
its affiliates) will consult with each other and agree on the desirability,
timing and substance of any press release, public announcement, publicity
statement or other disclosure relating to the Transaction or the business
of a party hereto (including in particular any product recall liability)
and, subject to applicable laws, stock exchange rules and the requirements
of any regulatory authorities, neither Xxxxx & Nephew or the Offeror (nor
their affiliates) nor the Company (or its affiliates) will make any public
disclosures without the prior consent of the other party (which consent
shall not be unreasonably withheld) as to the timing of such disclosure,
extent of distribution and form and substance thereof.
Combination Agreement -18-
--------------------------------------------------------------------------------
7 Governing Law
This Agreement shall be governed by and construed in accordance with the
laws of Switzerland regardless of the laws that might otherwise govern
under principles of conflicts of laws applicable thereto.
8 Arbitration
The parties hereto consent and agree that all disputes out of or in
connection with the Agreement, including disputes on its execution, binding
effect, performance, amendment and termination, shall be resolved to the
exclusion of the ordinary courts by a three-person arbitral tribunal in
accordance with the International Arbitration Rules of the Zurich Chamber
of Commerce. If there are not more than two parties involved each party
nominates an arbitrator. The decision of the arbitral tribunal shall be
final, and the parties waive all challenge of the award in accordance with
article 192 of the Swiss Act on Private International Law.
* * * * *
In witness whereof, each of the parties has caused this Agreement to be executed
on its behalf by its officers thereunto duly authorized, all at or on the day
and year first above written.
Combination Agreement -19-
--------------------------------------------------------------------------------
Meadowclean Limited
By: /s/ Pierre-Xxxxx Xxxxxxxx
----------------------------------
Name: Pierre-Xxxxx Xxxxxxxx
Title: Director
By: /s/ Antoine Vidts
----------------------------------
Name: Antoine Vidts
Title: Director
Xxxxx & Nephew plc
By: /s/ Xxxxxxxxxxx X. X'Xxxxxxx
----------------------------------
Name: Xxxxxxxxxxx X. X'Xxxxxxx
Title: Chief Executive
By: /s/ Xxxxx Xxxxxx
----------------------------------
Name: Xxxxx Xxxxxx
Title: Finance Director
Centerpulse Ltd
By: /s/ Dr. Xxx Xxxx
-----------------------------------
Name: Dr. Xxx Xxxx
Title: Chairman & CEO
By: /s/ Xxx Xxxxxx
-----------------------------------
Name: Xxx Xxxxxx
Title: CFO
