EXHIBIT 99.3
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POST-CLOSING COVENANTS AGREEMENT
Dated as of July 24, 2003,
Among
ROCHE HOLDING LTD,
IGEN INTERNATIONAL, INC.
And
IGEN INTEGRATED HEALTHCARE, LLC
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ARTICLE I
Definitions
SECTION 1.01. Definitions ............................................................. 2
ARTICLE II
Indemnification
SECTION 2.01. Indemnification by Newco................................................. 5
SECTION 2.02. Indemnification by Parent................................................ 6
SECTION 2.03. Procedures Relating to Indemnification................................... 8
SECTION 2.04. Certain Limitations...................................................... 11
SECTION 2.05. Exclusivity of Tax Allocation Agreement.................................. 12
SECTION 2.06. Exclusivity of Remedies.................................................. 13
ARTICLE III
Other Agreements
SECTION 3.01. Insurance ............................................................... 13
SECTION 3.02. Characterization of Payments............................................. 14
SECTION 3.03. Agreement Not to Solicit Employees....................................... 14
SECTION 3.04. Successors .............................................................. 15
SECTION 3.05. Third Party Rights; Notices.............................................. 16
SECTION 3.06. Retention of Records..................................................... 17
SECTION 3.07. Confidentiality; Preservation of Privilege; Access....................... 17
SECTION 3.08. Indemnification; Certain Claims.......................................... 21
SECTION 3.09. Public Announcements..................................................... 24
SECTION 3.10. Standstill .............................................................. 24
SECTION 3.11. Transferred Customers.................................................... 25
SECTION 3.12. New Patent Litigation.................................................... 25
SECTION 3.13. I/R Agreements .......................................................... 26
SECTION 3.14. PCR License Payment...................................................... 26
ARTICLE IV
Mutual Releases
SECTION 4.01. Mutual Releases.......................................................... 26
SECTION 4.02. Enforcement of Article IV................................................ 27
ARTICLE V
Miscellaneous and General
SECTION 5.01. Effectiveness; Modification or Amendment................................. 27
SECTION 5.02. Termination ............................................................. 28
SECTION 5.03. Notices ................................................................. 28
SECTION 5.04. Interpretation .......................................................... 29
SECTION 5.05. Severability ............................................................ 30
SECTION 5.06. Counterparts ............................................................ 30
SECTION 5.07. Entire Agreement; Third-Party Beneficiaries.............................. 30
SECTION 5.08. Certain Obligations...................................................... 30
SECTION 5.09. Governing Law ........................................................... 31
SECTION 5.10. Assignment .............................................................. 31
SECTION 5.11. Enforcement; Consent to Service of Process............................... 31
SECTION 5.12. Extension; Waiver........................................................ 32
POST-CLOSING COVENANTS AGREEMENT dated as of
July 24, 2003 (this "Agreement"), among ROCHE HOLDING
LTD, a joint stock company organized under the laws
of Switzerland ("Parent"), IGEN INTERNATIONAL, INC.,
a Delaware corporation (the "Company"), and IGEN
INTEGRATED HEALTHCARE, LLC, a Delaware limited
liability company ("Newco").
WHEREAS Parent, 66 ACQUISITION CORPORATION II, a Delaware
corporation and a wholly owned subsidiary of Parent ("Sub"), the Company and
Newco have entered into an Agreement and Plan of Merger dated as of the date of
this Agreement (the "Merger Agreement"), providing for the Merger (as defined in
the Merger Agreement);
WHEREAS simultaneously with the execution and delivery of this
Agreement, the Company and Newco are entering into a Restructuring Agreement,
dated as of the date of this Agreement (the "Restructuring Agreement"), pursuant
to which prior to the Effective Time (as defined in the Merger Agreement), among
other things (a) the Newco Assets (as defined in the Restructuring Agreement)
will be transferred to Newco or one or more of Newco's subsidiaries and (b)
Newco or one or more of its subsidiaries will assume the Assumed Liabilities (as
defined in the Restructuring Agreement);
WHEREAS as a condition to their willingness to enter into the
Merger Agreement and the Restructuring Agreement, the parties thereto have
requested that the parties hereto enter into this Agreement; and
WHEREAS the parties to this Agreement have determined that it
is necessary and desirable to set forth certain agreements that will govern
certain matters that may arise following the Effective Time.
NOW, THEREFORE, in consideration of the foregoing, and the
representations, warranties, covenants and agreements set forth herein, the
parties hereto hereby agree as follows:
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ARTICLE I
Definitions
SECTION 1.01. Definitions. Unless otherwise noted, terms used
but not defined in this Agreement shall have the meanings set forth in the
Merger Agreement or, if not set forth in the Merger Agreement, in the
Restructuring Agreement. In addition, the following terms shall have the
following meanings:
"Action" shall have the meaning set forth in Section 3.07(c).
"Business Day" shall mean any day other than a Saturday,
Sunday and any day on which the banks in Germany, Switzerland or the United
States or the federal courts in the United States are permitted or required by
applicable Law to close.
"Company Recourse Right" shall have the meaning set forth in
Section 3.05(b).
"Filings" shall mean the Proxy Statement, the Newco Form S-4,
the Newco Form 8-A and any other document filed or required to be filed with the
SEC by the Company or Newco in connection with the Transactions, or any
preliminary or final form thereof or any amendment or supplement thereto.
"Indemnifiable Losses" shall mean, subject to Section 2.04 and
Section 2.05, all losses, Liabilities, damages, deficiencies, fines, expenses,
Actions, demands, Judgments or settlements, whether or not resulting from Third
Party Claims, including interest and penalties recovered by a third party with
respect thereto and out-of-pocket expenses and reasonable attorneys' and
accountants' fees and expenses incurred in the investigation or defense of any
of the same or in asserting, preserving or enforcing any of an Indemnitee's
rights hereunder, suffered or incurred by an Indemnitee.
"Indemnifying Party" shall have the meaning set forth in
Section 2.03(a).
"Indemnitee" shall mean any of the Parent Indemnitees or the
Newco Indemnitees, as the case may be, who or which may seek indemnification
under this Agreement.
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"PCR License Payment" shall mean the $50,000,000 payment due
not later than two Business Days after the Effective Time pursuant to the PCR
License Agreement.
"Newco Indemnitees" shall mean Newco, each affiliate of Newco,
including any of its direct or indirect subsidiaries, each of their respective
Representatives and each of the heirs, executors, successors and assigns of any
of the foregoing.
"Newco Information" shall mean the Company Records and any and
all information, technical data or know-how, whether written or oral (including
that which relates to research, manufacturing, product plans, products,
services, suppliers, customers, markets, software, developments, inventions,
processes, designs, drawings, engineering, hardware configuration information,
marketing, finances or individuals in the employment) of any Newco Company after
giving effect to the Restructuring, that the Company or any of its affiliates
(including Newco and its subsidiaries) or any of their respective
Representatives furnishes or has furnished to Parent or any of its affiliates
(collectively, the "receiving person") or any of their respective
Representatives whether furnished orally or in writing or by any other means or
gathered by inspection and regardless of whether the same is specifically marked
or designated as "confidential" or "proprietary", together with any and all
notes, memoranda, analyses, compilations, studies or other documents (whether in
hard copy or electronic media) prepared by the receiving person or any of its
Representatives which contain or otherwise reflect such Newco Information,
together with any and all copies, extracts or other reproductions of any of the
same; provided, however, that the term "Newco Information" does not include
information that:
(a) is or becomes generally available to the public through no
wrongful act of the receiving person or its Representatives; or
(b) is or becomes available to the receiving person on a
non-confidential basis from a source other than (i) the Company or any of its
affiliates, (ii) Newco or any of its affiliates or (iii) their respective
Representatives, provided that such source is not known by the receiving person
to be subject to a confidentiality agreement with the Company or any of its
affiliates or Newco or any of its affiliates.
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"Newco Recourse Right" shall have the meaning set forth in
Section 3.05(a).
"Newco Successor Company" shall have the meaning set forth in
Section 3.04(a).
"Parent Indemnitees" shall mean Parent, each affiliate of
Parent, including any of its direct or indirect subsidiaries (including, after
the Effective Time, the Company), each of their respective Representatives and
each of the heirs, executors, successors and assigns of any of the foregoing.
"Parent Information" shall mean the Company Records and any
and all information, technical data or know-how, whether written or oral
(including that which relates to research, manufacturing, product plans,
products, services, suppliers, customers, markets, software, developments,
inventions, processes, designs, drawings, engineering, hardware configuration
information, marketing, finances or individuals in the employment) of Parent or
any of its affiliates after giving effect to the Restructuring and the Merger,
that Parent or any of its affiliates or any of their respective Representatives
furnishes or has furnished to the Company (prior to the Effective Time), Newco
or any of their respective affiliates (collectively, the "receiving person") or
any of their respective Representatives whether furnished orally or in writing
or by any other means or gathered by inspection and regardless of whether the
same is specifically marked or designated as "confidential" or "proprietary",
together with any and all notes, memoranda, analyses, compilations, studies or
other documents (whether in hard copy or electronic media) prepared by the
receiving person or any of its Representatives which contain or otherwise
reflect such Parent Information, together with any and all copies, extracts or
other reproductions of any of the same; provided, however, that the term "Parent
Information" does not include information that:
(a) is or becomes generally available to the public through no
wrongful act of the receiving person or its Representatives; or
(b) is or becomes available to the receiving person on a
non-confidential basis from a source other than Parent or any of its affiliates
or Representatives, provided that such source is not known by the receiving
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person to be subject to a confidentiality agreement with Parent or any of its
affiliates.
"Parent Successor Company" shall have the meaning set forth in
Section 3.04(b).
"Prevailing Party" shall have the meaning set forth in Section
4.02.
"Request" shall have the meaning set forth in Section 3.07(c).
"Third Party Claim" shall have the meaning set forth in
Section 2.03(a).
ARTICLE II
Indemnification
SECTION 2.01. Indemnification by Newco. Subject to the
provisions of this Article II, from and after the Effective Time Newco shall
indemnify, defend and hold harmless the Parent Indemnitees from and against, and
pay or reimburse the Parent Indemnitees for, all Indemnifiable Losses, as
incurred, to the extent:
(a) relating to or arising from the Newco Business, the Newco
Assets or the Assumed Liabilities (including the failure by Newco or any Newco
Company to pay, perform or otherwise discharge any of the Assumed Liabilities in
accordance with their terms), whether such Indemnifiable Losses relate to or
arise from events, occurrences, actions, omissions, facts or circumstances
occurring, existing or asserted before, at or after the Effective Time;
(b) relating to or arising from the Retained Contracts,
whether such Indemnifiable Losses relate to or arise from events, occurrences,
actions, omissions, facts or circumstances occurring, existing or asserted
before, at or after the Effective Time; provided, however, that with respect to
Indemnifiable Losses related to or arising from events, occurrences, facts or
circumstances relating to or arising from actions or omissions by the Company
occurring after the Effective Time, Newco shall not be liable to the extent such
Indemnifiable Losses directly relate to or arise from actions or omissions by
the Company that are
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inconsistent in any respect with any written instruction from Newco with respect
to such Retained Contract;
(c) relating to or arising from any untrue or allegedly untrue
statement of a material fact contained in any of the Filings by the Company
prior to the Effective Time or by Newco at any time, or any omission to state
therein a material fact relating to the Company or any Newco Company required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, but in each case not
with respect to statements made therein or incorporated by reference therein
based upon information supplied by Parent or any of its affiliates or any of
their respective Representatives specifically for inclusion or incorporation by
reference therein;
(d) relating to or arising from the breach by any Newco
Company of any agreement or covenant contained in any Transaction Agreement
which is to be performed or complied with by it after the Effective Time;
(e) relating to or arising from the breach by the Company or
Newco prior to the Effective Time of any agreement or covenant contained in any
Transaction Agreement which is to be performed or complied with by it prior to
the Effective Time;
(f) relating to or arising from the breach by the Continuing
Licensee Subsidiary of any agreement or covenant contained in the License
Agreement or the Covenants Not to Xxx, in each case which is to be performed or
complied with by it prior to the Effective Time; or
(g) relating to or arising from any guarantee, performance
bond or other Contract that Parent, any of its affiliates or the Company may be
required to grant in favor of, or enter into with, any Governmental Entity,
whether prior to, at or after the Effective Time, in connection with any
Contract entered into prior to the Effective Time by the Company or any Company
Subsidiary with any Governmental Entity.
SECTION 2.02. Indemnification by Parent. Subject to the
provisions of this Article II, from and after the Effective Time Parent shall
indemnify, defend and hold harmless the Newco Indemnitees from and against, and
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pay or reimburse the Newco Indemnitees, for all Indemnifiable Losses, as
incurred, to the extent:
(a) relating to or arising from the Continuing Company
Business, the Continuing Company Assets or the Continuing Company Liabilities
(including the failure by the Company to pay, perform or otherwise discharge any
of the Continuing Company Liabilities in accordance with their terms), whether
such Indemnifiable Losses relate to or arise from events, occurrences, actions,
omissions, facts or circumstances occurring, existing or asserted before, at or
after the Effective Time (other than Indemnifiable Losses that relate to or
arise from (i) the Retained Contracts, which are the subject of Section 2.02(b),
and (ii) the Transaction Agreements, which are the subject of Sections 2.02(d)
and 2.02(e));
(b) relating to or arising from the Retained Contracts with
respect to such Indemnifiable Losses relating to or arising from events,
occurrences, facts or circumstances relating to or arising from actions or
omissions by the Company occurring after the Effective Time that are
inconsistent in any respect with any written instruction from Newco with respect
to such Retained Contract;
(c) relating to or arising from any untrue statement of a
material fact contained in any of the Filings, or any omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they were made, not misleading, but only with respect to statements made
therein or incorporated by reference therein based upon information supplied by
Parent or any of its affiliates or any of their respective Representatives
(including, after the Effective Time, the Company and the subsidiaries of the
Company) specifically for inclusion or incorporation by reference therein;
(d) relating to or arising from the breach by Parent or any of
its affiliates (other than, prior to the Effective Time, the Company, Newco or
any of their affiliates) of any agreement or covenant contained in any
Transaction Agreement, whether such Indemnifiable Losses relate to or arise from
events, occurrences, actions, omissions, facts or circumstances occurring,
existing or asserted before, at or after the Effective Time; or
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(e) relating to or arising from the breach by the Company of
any agreement or covenant contained in any Transaction Agreement which is to be
performed or complied with by it after the Effective Time.
SECTION 2.03. Procedures Relating to Indemnification. (a) In
order for an Indemnitee to be entitled to any indemnification provided for under
this Agreement in respect of, arising out of or involving a claim made by any
person who is not an Indemnitee against such Indemnitee (a "Third Party Claim"),
such Indemnitee must notify the party who may become obligated to provide
indemnification hereunder (the "Indemnifying Party") in writing, and in
reasonable detail, of the Third Party Claim reasonably promptly, and in any
event within 10 Business Days after receipt by such Indemnitee of written notice
of the Third Party Claim; provided, however, that failure to give such
notification shall not affect the indemnification provided hereunder except to
the extent the Indemnifying Party shall have been actually and materially
prejudiced as a result of such failure; provided further, however, that with
respect to any Third Party Claim for which Newco is the Indemnifying Party, such
Indemnifying Party shall be deemed to have received notice with respect to such
Third Party Claim by or against the Company or any of its subsidiaries (other
than the Newco Companies) for which the Company or any of its subsidiaries
(other than the Newco Companies) received notice prior to the Effective Time.
After any required notification (if applicable), the Indemnitee shall deliver to
the Indemnifying Party, promptly after the Indemnitee's receipt thereof, copies
of all notices and documents (including court papers) received by the Indemnitee
relating to the Third Party Claim.
(b) If a Third Party Claim is made against an Indemnitee, the
Indemnifying Party will be entitled to participate in the defense thereof and,
if it so chooses, to assume the defense thereof (at the expense of the
Indemnifying Party) with counsel selected by the Indemnifying Party and
reasonably satisfactory to the Indemnitee. Should the Indemnifying Party so
elect to assume the defense of a Third Party Claim, the Indemnifying Party will
not be liable to the Indemnitee for any legal expenses subsequently incurred by
the Indemnitee in connection with the defense thereof. If the Indemnifying Party
assumes such defense, the Indemnitee shall have the right to participate, at its
own expense, in the defense
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thereof solely to assert any additional defenses and to employ counsel, at its
own expense, except as set forth below, separate from the counsel employed by
the Indemnifying Party, it being understood that the Indemnifying Party shall
control such defense. The Indemnifying Party shall be liable for the reasonable
fees and expenses of counsel employed by the Indemnitee for any period during
which the Indemnifying Party has not assumed the defense thereof (other than
during any period in which the Indemnitee shall have failed to give notice of
the Third Party Claim as provided above). Notwithstanding the foregoing, the
Indemnifying Party shall not be entitled to assume the defense of any Third
Party Claim (and shall not be liable for the fees and expenses of counsel
incurred by the Indemnitee in defending such Third Party Claim, except for the
reasonable fees and expenses of counsel selected by the Indemnifying Party and
reasonably satisfactory to the Indemnitee) if the Third Party Claim seeks an
order, injunction or other equitable relief or relief for other than money
damages against the Indemnitee which the Indemnitee reasonably determines, after
conferring with its counsel, cannot be separated from any related claim for
money damages. If such equitable or other relief portion of the Third Party
Claim can be so separated from that for money damages, the Indemnifying Party
shall be entitled to assume the defense of the portion relating to money
damages. The indemnification required by Section 2.01 or 2.02, as the case may
be, shall be made by periodic payments of the amount thereof during the course
of the investigation or defense, as and when bills are received or the
Indemnifiable Loss is incurred. If the Indemnifying Party chooses to defend or
prosecute a Third Party Claim (i) all the parties hereto reasonably necessary or
appropriate for such defense or prosecution shall cooperate in the defense or
prosecution thereof, which cooperation shall include the retention in accordance
with this Agreement and (upon the Indemnifying Party's request) the provision to
the Indemnifying Party of records and information which are reasonably relevant
to such Third Party Claim, (ii) the Indemnifying Party shall keep the Indemnitee
reasonably informed of all significant developments in connection with the
defense or prosecution of such Third Party Claim and (iii) the Indemnitee will
agree to any settlement, compromise or discharge of such Third Party Claim which
the Indemnifying Party may recommend (after representing to the Indemnitee that
such settlement is reasonably likely to be acceptable to the
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parties to the Third Party Claim) and which by its terms obligates the
Indemnifying Party to pay the full amount of liability in connection with such
Third Party Claim; provided, however, that, without the Indemnitee's consent
(which consent shall not be unreasonably withheld, conditioned or delayed), the
Indemnifying Party shall not consent to entry of any Judgment or enter into any
settlement (x) that provides for injunctive or other nonmonetary relief
affecting the Indemnitee or its properties or (y) that does not include as an
unconditional term thereof the giving by each claimant or plaintiff to such
Indemnitee of a release from all liability with respect to such claim; provided
further, however, that if the Indemnitee does not consent to any settlement
recommended by the Indemnifying Party (after representing to the Indemnitee that
such settlement is reasonably likely to be acceptable to the parties to the
Third Party Claim) then the Indemnifying Party (1) shall not in any event be
obligated to indemnify the Indemnitee, or otherwise be responsible, for any
amount in excess of the amount of the settlement so recommended by the
Indemnifying Party and (2) shall be entitled to reimbursement of the fees and
expenses of counsel incurred by the Indemnifying Party after the date on which
the recommendation was made to the Indemnitee in the event the final and
unappealable Judgment in such Third Party Claim exceeds the amount of the
settlement so recommended. If the Indemnifying Party shall have assumed the
defense of a Third Party Claim, the Indemnitee shall not admit any liability
with respect to, or settle, compromise or discharge, such Third Party Claim
without the Indemnifying Party's prior written consent. If the Indemnifying
Party does not or is not entitled to assume the defense of a Third Party Claim,
the Indemnitee may defend the same in such manner as it may deem appropriate;
provided, however, that the Indemnitee shall not admit any liability with
respect to, or settle, compromise or discharge such Third-Party Claim without
the Indemnifying Party's prior written consent.
(c) In order for an Indemnitee to be entitled to any
indemnification provided for under this Agreement in respect of a claim that
does not involve a Third Party Claim, the Indemnitee shall deliver notice of
such claim (in reasonably sufficient detail to enable the Indemnifying Party to
evaluate such claim) with reasonable promptness to the Indemnifying Party. The
failure by any Indemnitee to give such notification shall not affect the
indemnification
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provided hereunder except to the extent that the Indemnifying Party shall have
been actually and materially prejudiced as a result of such failure. If the
Indemnifying Party does not notify the Indemnitee within 20 Business Days
following its receipt of such notice that the Indemnifying Party disputes its
liability with respect to such claim under Section 2.01 or 2.02, as the case may
be, the claim shall be conclusively deemed a liability of the Indemnifying Party
under Section 2.01 or 2.02, as the case may be, and the Indemnifying Party shall
pay the amount of such liability to the Indemnitee on demand or, in the case of
any notice in which the amount of the claim (or any portion thereof) is
estimated, on such later date when the amount of such claim (or such portion
thereof) becomes finally determined. If the Indemnifying Party has timely
disputed its liability with respect to such claim, as provided above, the
Indemnifying Party and the Indemnitee shall proceed in good faith to negotiate a
resolution of such dispute and, if not resolved through negotiations, such
dispute shall be resolved by litigation in an appropriate court of competent
jurisdiction.
(d) Notwithstanding any other provision of this Agreement,
Newco acknowledges and agrees that Newco shall (solely at its own cost and
expense) assume and continue the defense of the Newco Litigation and use its
reasonable best efforts to defend any Parent Indemnitee and to cause any Parent
Indemnitee to be dismissed with prejudice as a party to any Newco Litigation.
SECTION 2.04. Certain Limitations. (a) The amount of any
Indemnifiable Losses or other liability for which indemnification is provided
under this Agreement shall be net of any amounts actually recovered by the
Indemnitee from third parties (including amounts actually recovered under
insurance policies) with respect to such Indemnifiable Losses. The Indemnitee
shall use its reasonable best efforts to seek to obtain recovery in respect of
any Indemnifiable Loss or such other liability under any available insurance
policy.
(b) No Indemnitee shall be entitled to indemnification
provided for under this Agreement if the facts, events or other circumstances
giving rise to the indemnification claim arose from or are related to (i) any
breach of the representations, warranties, covenants or agreements of such
Indemnitee or its affiliates in this Agreement or in any other Transaction
Agreement (it being
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understood that the representations, warranties, covenants and agreements of the
Company in the Merger Agreement shall for the sole purpose of this Section
2.04(b) be deemed to have been given by Newco) or (ii) actions, omissions,
inactions or disclosures taken or made by the Indemnitee or its affiliates.
(c) All indemnification payments under this Agreement shall be
reduced to take account of the present value of any net Tax benefit (including
any current or future deductions, any reduction of income or gain upon a sale,
disposition, conveyance, license or other similar transaction as a result of
increased Tax basis, any Tax refunds received, any use of a credit of Taxes and
any increase in the amount of losses, reliefs, allowances or other similar Tax
attributes) realized by the Indemnitee in connection with or otherwise arising
(directly or indirectly) from the incurrence of any Indemnifiable Loss. Upon the
written request of the Indemnifying Party, the Indemnitee shall provide the
amount of the Tax benefit realized by the Indemnitee in connection with or
otherwise arising (directly or indirectly) from the incurrence of any
Indemnifiable Loss together with reasonable detail with respect to such
calculation. In computing the amount of any such Tax benefit, the Indemnitee
shall be deemed to recognize all other items of income, gain, loss, deduction or
credit before recognizing any item arising from the receipt of any
indemnification payment hereunder or the incurrence or payment of any
Indemnifiable Loss. The Indemnitee shall cooperate fully with all requests from
the Indemnifying Party in connection with determining the present value of such
net Tax benefit.
(d) The amount of all indemnification obligations under this
Agreement shall be calculated on an after-tax basis (without taking into account
any net operating loss or other similar tax credit or item available to offset
such amount). Any payments made to one party by another party pursuant to this
Agreement shall be treated for all Tax purposes as nontaxable payments
(dividends or capital contributions, as the case may be) made between Newco and
the Company immediately prior to the Merger, unless, and then only to the
extent, otherwise required by a Final Determination (as defined in the Tax
Allocation Agreement).
SECTION 2.05. Exclusivity of Tax Allocation Agreement. Except
for Sections 2.04(c), 2.04(d) and 3.02
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of this Agreement, and Sections 2.01(f), 4.19 and 7.08 of the Merger Agreement,
the Tax Allocation Agreement shall be the exclusive agreement among the parties
with respect to all Tax matters, including indemnification and any procedures in
connection therewith.
SECTION 2.06. Exclusivity of Remedies. From and after the
Effective Time, the remedies provided for in this Article II shall, as between
the parties, be the exclusive monetary remedies of the parties to this Agreement
with respect to the Transaction Agreements, except if the indemnification for
the Indemnifiable Losses provided for in this Article II is unavailable to any
Indemnitee for any reason, the Indemnifying Party shall contribute to the amount
paid or payable by such Indemnitee as a result of any Indemnifiable Losses in
such proportion as is appropriate to reflect any relevant equitable
considerations. Each party hereto agrees that the previous sentence shall not
limit or otherwise affect any non-monetary right or remedy which any party to
this Agreement may have under the Transaction Agreements or otherwise limit or
affect any such party's right to seek equitable relief, including specific
performance. For the avoidance of doubt, each party hereto agrees that this
Article II shall not confer any (a) additional remedy on any person for any
breach of any representation, warranty or covenant contained in any Commercial
Agreement, except as provided in 2.01(f), and (b) remedy on any person for any
breach of any covenant or agreement set forth in any Transaction Agreement that
does not survive the Effective Time.
ARTICLE III
Other Agreements
SECTION 3.01. Insurance. From the Effective Time until the
expiration of such policies according to their terms, the Company shall use its
reasonable best efforts to maintain in effect the insurance policies maintained
by the Company immediately prior to the Effective Time (other than directors'
and officers' liability insurance policies, which are the subject of Section
3.08(b)) for which premiums have been paid in full prior to the Effective Time
and shall not take any action to surrender, terminate or otherwise limit the
coverage thereof; provided, however, that in maintaining such policies, the
Company shall not be required to make any expenditures or incur any Liabilities
with respect to the
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maintenance of such policies (other than any expenditures in connection with
administering or making claims under such policies, which expenditures shall be
reimbursed by Newco). In the event that any Newco Asset suffers any damage,
destruction or other casualty loss, the Company shall surrender to Newco (a) all
insurance proceeds received with respect to such damage, destruction or casualty
loss and (b) all rights of the Company with respect to any causes of action in
connection with such damage, destruction or casualty loss. The Company shall
make available to the Newco Companies the benefit of any workers' compensation,
general liability, product liability, automobile liability, umbrella (excess)
liability or crime or other insurance policy covering or relating to the Newco
Business, the Newco Assets or the Assumed Liabilities. The Company shall
promptly pay to Newco all insurance proceeds relating to the Newco Business, the
Newco Assets or the Assumed Liabilities received by the Company under any
insurance policy. Nothing in this Section 3.01 shall (i) reduce, limit or
otherwise affect the right of the Company to seek or obtain insurance proceeds
with respect to any damage, destruction or casualty loss to or of a Continuing
Company Asset, nor shall anything in this Section 3.01 reduce, limit or
otherwise affect any of the rights of Newco or any other Newco Indemnitee set
forth in Article II or (ii) require the Company to obtain any additional
insurance with respect to any Newco Asset.
SECTION 3.02. Characterization of Payments. The payments made
pursuant to this Agreement shall be treated as occurring immediately before the
Effective Time, and none of the Newco Companies, the Company and its
subsidiaries and Parent and its subsidiaries or any affiliate of any of the
foregoing shall take any position inconsistent with such treatment before any
Taxing Authority (as defined in the Tax Allocation Agreement), except to the
extent that a Final Determination with respect to the recipient party causes any
such payment to not be so treated.
SECTION 3.03. Agreement Not to Solicit Employees. (a) Parent
understands that Newco shall be entitled to protect and preserve the going
concern value of the Newco Business to the extent permitted by Law and that
Newco would not have entered into this Agreement, the Restructuring Agreement,
the Merger Agreement or the other
15
Transaction Agreements to which it is a party absent the provisions of this
Section 3.03; provided, however, that this Section 3.03 shall not inure to the
benefit of any person (or such person's affiliates other than Newco and its
subsidiaries as of immediately prior to the date of such sale, conveyance,
transfer, lease or acquisition) (i) to whom Newco sells, conveys, transfers or
leases, in one transaction or a series of related transactions, directly or
indirectly, all or substantially all of its assets or (ii) who acquires, in one
transaction or a series of related transactions, directly or indirectly, more
than a majority of the outstanding shares of Newco Common Stock whether by stock
purchase, merger, share exchange or otherwise.
(b) Parent agrees that for a period of two years from and
after the Effective Time, it shall not, and shall not permit its subsidiaries
to, directly or indirectly, solicit for employment any individual employed by
any Newco Company or any of their respective divisions. Notwithstanding the
foregoing, it shall not constitute a breach of the foregoing sentence if Parent
or its subsidiaries make solicitations for employment by general advertisements
in periodicals of broad distribution or other advertisement media of similar
nature that are not specifically directed at Employees.
SECTION 3.04. Successors. (a) Newco shall not consolidate with
or merge with or into, or sell, convey, transfer or lease, in one transaction or
a series of related transactions, all or substantially all of its assets to, any
person, unless the resulting, surviving or transferee person (the "Newco
Successor Company") shall expressly assume in writing all the obligations of
Newco under this Agreement. Except as otherwise provided in Section 3.03(a),
such Newco Successor Company shall be the successor to Newco and shall succeed
to, and be substituted for, Newco under this Agreement, but in the case of a
sale, conveyance, transfer or lease of less than substantially all of its
assets, Newco shall not be released from its obligations hereunder.
(b) Parent shall not consolidate with or merge with or into,
or sell, convey, transfer or lease, in one transaction or a series of related
transactions, all or substantially all of its assets to, any person, unless the
resulting, surviving or transferee person (the "Parent Successor Company") shall
expressly assume in writing all
16
the obligations of Parent under this Agreement. Such Parent Successor Company
shall be the successor to Parent and shall succeed to, and be substituted for,
Parent under this Agreement, but in the case of a sale, conveyance, transfer or
lease of less than substantially all of its assets, Parent shall not be released
from its obligations hereunder.
SECTION 3.05. Third Party Rights; Notices. (a) In the event
that after the Effective Time any of the Newco Companies holds any right to
indemnification other than a right to indemnification under this Agreement or
any other contractual or other right (collectively, a "Newco Recourse Right")
with respect to any Continuing Company Liability or any Assumed Liability for
which the Company is held responsible, then (i) to the extent possible such
Newco Recourse Right shall be deemed to be held as a shared right of the
applicable Newco Companies and the Company to the extent necessary to protect
the Company against such Continuing Company Liability or such Assumed Liability
and (ii) to the extent not so possible, Newco shall, or shall cause the
applicable Newco Company to, assert or otherwise make available to the Company
the full benefit of such Newco Recourse Right by making a claim on behalf of the
Company or taking other steps reasonably requested by the Company.
(b) In the event that after the Effective Time the Company
holds any right to indemnification or any other contractual or other right
(collectively, a "Company Recourse Right") with respect to any Assumed Liability
or any Continuing Company Liability for which any of the Newco Companies are
held responsible, then (i) to the extent possible such Company Recourse Right
shall be deemed to be held as a shared right of the Company and the applicable
Newco Companies to the extent necessary to protect the Newco Companies against
such Assumed Liability or such Continuing Company Liability and (ii) to the
extent not so possible, the Company shall assert or otherwise make available to
the Newco Companies the full benefit of such Company Recourse Right by making a
claim on behalf of the Newco Companies or taking other steps reasonably
requested by the Newco Companies.
(c) The Company hereby agrees to provide prompt written notice
to Newco of any notice or other written communication received by the Company
with respect to any
17
Retained Contract and a copy of such notice or other written communication.
SECTION 3.06. Retention of Records. Except as provided in any
of the Transaction Agreements and except for any records related to Taxes (as
defined in the Tax Allocation Agreement) which are the subject of, and governed
by, the Tax Allocation Agreement, if any Company Records (as defined in the
Restructuring Agreement) are retained by the Company or a Newco Company, the
Company shall, and Newco shall, and Newco shall cause the other Newco Companies
to, retain all such Company Records in the Company's or Newco Companies'
possession or under their respective control until such Company Records are at
least six years old (or for such longer period as may be required by Law) except
that if, prior to the expiration of such period, the Company or any Newco
Company wishes to destroy or dispose of any such Company Records that are at
least three years old, then prior to destroying or disposing of any of such
Company Records, (a) the Company or Newco, as applicable, shall provide no less
than 60 days' prior written notice to the other person, specifying the Company
Records proposed to be destroyed or disposed of, and (b) if, prior to the
scheduled date of such destruction or disposal, the other person requests in
writing that any of the Company Records proposed to be destroyed or disposed of
be delivered to such other person, the Company or Newco, as applicable, promptly
shall arrange for the delivery of the requested Company Records to a location
specified by, and at the expense of, the requesting person.
SECTION 3.07. Confidentiality; Preservation of Privilege;
Access. (a) (i) Parent shall keep, and shall cause its affiliates and
Representatives to keep, the Newco Information strictly confidential and will
disclose such Newco Information only to such of its affiliates and
Representatives who need to know such Newco Information and who agree to be
bound by this Section 3.07 and agree not to disclose such Newco Information to
any other person. Without the prior written consent of Newco, Parent shall not,
and Parent shall cause each other receiving person and their respective
Representatives not to, disclose the Newco Information to any person except as
may be required by Law or judicial process and in accordance with this Section
3.07. (ii) Newco shall keep, and shall cause its affiliates and Representatives
to keep, the Parent Information strictly confidential and will disclose such
18
Parent Information only to such of its affiliates and Representatives who need
to know such Parent Information and who agree to be bound by this Section 3.07
and agree not to disclose such Parent Information to any other person. Without
the prior written consent of Parent, Parent shall not, and shall cause each
other receiving person and their respective Representatives not to disclose the
Parent Information to any person except as may be required by Law or judicial
process and in accordance with this Section 3.07.
(b) (i) In the event that any receiving person or any of its
Representatives receives a request or is required by Law or judicial process to
disclose to a court or other tribunal all or any part of the Newco Information,
such receiving party or its Representatives shall promptly notify Newco of the
request in writing, and consult with and assist Newco in seeking a protective
order or request for other appropriate remedy. In the event that such protective
order or other remedy is not obtained or Newco waives compliance with the terms
of this Section 3.07, such receiving party or its Representatives, as
applicable, shall disclose only that portion of the Newco Information or facts
which it determines in good faith, after consultation with outside counsel, is
legally required to be disclosed, and will exercise its reasonable best efforts
to assure that confidential treatment will be accorded such Newco Information or
facts by the persons or entities receiving the same. Newco will be given an
opportunity to review the Newco Information or facts prior to disclosure. (ii)
In the event that any receiving person or any of its Representatives receives a
request or is required by Law or judicial process to disclose to a court or
other tribunal all or any part of the Parent Information, such receiving party
or its Representatives shall promptly notify Parent of the request in writing,
and consult with and assist Parent in seeking a protective order or request for
other appropriate remedy. In the event that such protective order or other
remedy is not obtained or Parent waives compliance with the terms of this
Section 3.07, such receiving party or its Representatives, as applicable, shall
disclose only that portion of the Parent Information or facts which it
determines in good faith, after consultation with outside counsel, is legally
required to be disclosed, and will exercise its reasonable best efforts to
assure that confidential treatment will be accorded such Parent Information or
facts by the persons or entities
19
receiving the same. Parent will be given an opportunity to review the Parent
Information or facts prior to disclosure.
(c) Each party to this Agreement shall, promptly (and in any
event within 10 Business Days of such receipt) upon its receipt or the receipt
by any of its affiliates of a request or requirement (by oral questions,
interrogatories, requests for documents, Parent Information or Newco
Information, as applicable, subpoenas, civil investigative demands or other
similar processes) reasonably regarded as calling for the inspection or
production of any documents or other Parent Information or Newco Information, as
applicable, which relates to the business or operations of any other party to
this Agreement (a "Request"), notify the party to this Agreement whose
documents, Parent Information or Newco Information, as applicable, is the
subject of such Request. The preceding sentence shall apply regardless of
whether the person delivering the Request is a party in the claim, suit, action,
arbitration, inquiry, investigation or other proceeding of any nature (whether
criminal, civil, legislative, administrative, regulatory, prosecutorial or
otherwise) by or before any arbitrator or Governmental Entity or similar person
or body (each, an "Action"), to which the Request relates. In addition to
complying with the applicable provisions of Section 3.07(b), each party shall
use reasonable best efforts to assert and maintain, or cause its affiliates to
assert and maintain, any applicable claim to privilege, immunity,
confidentiality or protection in order to protect such documents and other
Parent Information or Newco Information, as applicable, from disclosure, and
shall use reasonable best efforts to seek to condition any disclosure which may
be required on such protective terms as it may reasonably determine to be
appropriate. Following the receipt of the notice described in the first sentence
of this Section 3.07(c), no party may waive an applicable privilege without the
prior written consent of the affected party to this Agreement (or any affected
affiliate or affiliates of any such party) except, in the opinion of such
party's counsel, as required by Law.
(d) From and after the Effective Time, Newco shall, and shall
cause each Newco Company to, afford to Parent, and to Parent's Representatives,
reasonable access during normal business hours to documents within the
possession or control of any Newco Company that were Assets of the Company
transferred to Newco in the Restructuring
20
(other than any Asset that constitutes a Company Record), to the extent such
access is reasonably required for the purposes of defending any Action commenced
or threatened in writing against the Company (other than any Action which arose
or resulted from or is related to any breach of any Transaction Agreement or in
which the Company and Newco's interests are adverse) directly relating to the
business, Assets (other than Intellectual Property Rights or any Asset related
thereto) or Liabilities of the Company as they existed immediately prior to
giving effect to the Restructuring; provided, however, that such access will not
unreasonably interfere with the normal operations of any Newco Company and the
reasonable out-of-pocket expenses of any Newco Company incurred in connection
therewith will be paid by Parent; provided further, however, that any Newco
Company may withhold (i) any document that (A) the disclosure of which would
violate any Contract with a third party or any applicable Law or Judgment or
would result in the waiver of any legal privilege or work-product protection
(provided that such Newco Company shall have used its reasonable best efforts to
obtain a Consent or waiver from such third party or to establish a joint-defense
privilege to the extent it is reasonably available, as applicable; provided,
however, that such Newco Company shall not be required to pay or commit to pay
any amount to (or incur any obligation in favor of) any person from whom such
Consent or waiver may be required) or (B) otherwise relates to any Action
between the Newco and any of its affiliates, on the one hand, and the Company
and any of its affiliates, on the other hand, or (ii) such documents or portions
of documents that Newco determines in good faith, after consultation with
outside counsel, should not be disclosed in order to ensure compliance with
antitrust or other similar Law or Judgment. For the avoidance of doubt, all
documents provided to Parent, or Parent's Representatives pursuant to this
Section 3.07(e) shall be subject to Parent's obligations with respect to Newco
Information contained in paragraphs (a) and (b) of Section 3.07.
(e) Each of the parties to this Agreement hereby agrees that
(i) nothing in this Section 3.07 shall override any confidentiality obligation
owed by it or its affiliates pursuant to any Commercial Agreement and (ii) in
the event of a conflict between the confidentiality provisions set forth in any
Commercial Agreement, on the one hand, and
21
this Agreement, on the other hand, the provisions set forth in the applicable
Commercial Agreement shall govern.
SECTION 3.08. Indemnification; Certain Claims. (a) To the
fullest extent permitted by Law, Parent shall cause the Company to honor all its
obligations to indemnify (including any obligations to advance funds for
expenses) the current or former directors or officers of the Company for acts or
omissions by such directors or officers occurring prior to the Effective Time to
the fullest extent that such obligations of the Company exist on the date of
this Agreement pursuant to the Company Charter, the Company By-laws or
individual indemnity agreements and such obligations shall survive the Merger
and shall continue in full force and effect in accordance with their respective
terms until the expiration of the applicable statute of limitations with respect
to any claims against such directors or officers arising out of such acts or
omissions.
(b) From the Effective Time until the sixth anniversary of the
Effective Time, Parent shall cause to be maintained in effect the current
policies of directors' and officers' liability insurance maintained by the
Company (provided that Parent may cause to be substituted therefor policies with
reputable and financially sound carriers of at least the same coverage and
amounts containing terms and conditions which are no less advantageous) with
respect to claims arising from or related to facts or events which occurred at
or before the Effective Time; provided that in satisfying its obligation under
this Section 3.08(b), Parent shall not be obligated to pay premiums in excess of
250% of the amount per annum required to be paid by the Company in the twelve
months ending December 12, 2003, which amount is set forth in clause (x) of
Section 6.01 (introductory paragraph) of the Company Disclosure Letter; and
provided, further, that if the annual premiums of such insurance exceed such
amount, Parent shall nevertheless obtain such insurance; provided that Newco
shall pay the Company the amount of any premiums in excess of 250% of the amount
per annum required to be paid by the Company in the twelve months ending
December 12, 2003.
(c) Parent shall not permit the Company to amend or repeal any
provision of the Company Charter or Company By-laws after the Effective Time if
such action would adversely affect the rights of individuals who on or prior to
the Effective Time were entitled to advances,
22
indemnification or exculpation thereunder for actions or omissions by such
individuals prior to the Effective Time. The individuals referred to in the
preceding sentence shall include any individuals who served as of the Effective
Time as directors or officers of any subsidiary of the Company at the Company's
request, it being acknowledged by the parties hereto that each director or
officer of the Company who is currently serving as a director or officer of a
subsidiary of the Company is doing so at such request of the Company.
(d) In the event the Company or any successor to the Company
(i) consolidates with or merges into any other person and shall not be the
continuing or surviving corporation or entity in such consolidation or merger or
(ii) transfers all or substantially all its properties and assets to any person,
then, and in each case, proper provision shall be made so that the successors to
the Company or the successors of any successor to the Company, as the case may
be, honor the obligations of the Company set forth in this Section 3.08. For the
avoidance of doubt, this Section 3.08(d) shall similarly apply to successive
consolidations, mergers and transfers.
(e) Following the Effective Time, Parent shall not, and Parent
shall not permit the Company or any other affiliate of Parent or encourage any
other person to, assert any rights or pursue any Action, whether directly or on
a derivative basis, against (i) the Company or any of its affiliates or Newco or
any of its affiliates or (ii) any of the current or former directors, officers,
members of the board of managers, members, managers, consultants, advisors,
attorneys, trustees, agents or individuals in the employment of the Company or
any of its affiliates or of Newco or any of its affiliates (in each case, solely
in their capacities as such), in each case for acts or omissions occurring prior
to the Effective Time, whether known or unknown, and Parent shall not, and
Parent shall not permit the Company or any other affiliate of Parent to,
cooperate with any person in the assertion of any such rights or pursuing any
such Action except (x) as required by subpoena or other judicial or legal
process or (y) as required by any inquiry by a Governmental Entity, but in each
case only to the extent such inquiry or requirement to cooperate has not arisen
as a result of a breach of this Section 3.08(e); provided, however, that this
Section 3.08(e) shall not (A) affect any person's
23
right to enforce any Transaction Agreement, any Commercial Agreement, any Newco
I/R Agreement or any agreement entered into between the Company, Newco or any of
their respective affiliates, on the one hand, and any of the R Parties or any of
their respective affiliates, on the other hand, after the date of this Agreement
but prior to the Effective Time or any provision herein or therein in accordance
with its terms, (B) apply to any act or omission which constitutes fraud in the
inducement with respect to any of the Transaction Agreements or any of the
Commercial Agreements, (C) apply to any action permitted or required by Section
3.12 or (D) apply to any action permitted or required by the Ongoing Litigation
Agreement; provided further, however, that in the event this Agreement is
terminated, this Section 3.08(e) shall be null and void and shall not operate as
a waiver or release of any rights or Actions that might have been asserted or
pursued but for this Section 3.08(e). Following the Effective Time, Parent
shall, and shall cause the Company and its other affiliates to, cooperate with
the current and former directors, officers, members of the board of managers,
members, managers, consultants, advisors, agents and individuals in the
employment of the Company and Newco in seeking the dismissal of any derivative
suits or other suits for or on behalf of shareholders of the Company pending as
of the Effective Time.
(f) Following the Effective Time, Newco shall not, and shall
not permit any Newco Company or any affiliate of Newco or encourage any other
person to, assert any rights or pursue any Action, whether directly or on a
derivative basis, against (i) Parent or any of its affiliates or (ii) any of the
current or former directors, officers, members of the board of managers,
members, managers, consultants, advisors, attorneys, trustees, agents or
individuals in the employment of Parent or any of its affiliates (in each case,
solely in their capacities as such), in each case for acts or omissions
occurring prior to the Effective Time, whether known or unknown, and Newco shall
not, and shall not permit any Newco Company or any affiliate of Newco to,
cooperate with any person in the assertion of any such rights or pursuing any
such Action except (x) as required by subpoena or other judicial or legal
process or (y) as required by any inquiry by a Governmental Entity, but in each
case only to the extent such inquiry or requirement to cooperate has not arisen
as a result of a breach of this Section 3.08(f); provided,
24
however, that this Section 3.08(f) shall not (A) affect any person's right to
enforce any Transaction Agreement, any Commercial Agreement, any Newco I/R
Agreement or any agreement entered into between the Company, Newco or any of
their respective affiliates, on the one hand, and any of the R Parties or any of
their respective affiliates, on the other hand, after the date of this Agreement
but prior to the Effective Time or any provision herein or therein in accordance
with its terms, (B) apply to any act or omission which constitutes fraud in the
inducement with respect to any of the Transaction Agreements or any of the
Commercial Agreements, (C) apply to any action permitted or required by Section
3.12 or (D) apply to any action permitted or required by the Ongoing Litigation
Agreement; provided further, however, that in the event this Agreement is
terminated, this Section 3.08(f) shall be null and void and shall not operate as
a waiver or release of any rights or Actions that might have been asserted or
pursued but for this Section 3.08(f).
SECTION 3.09. Public Announcements. As of and after the
Effective Time, Parent and its subsidiaries, including the Company, on the one
hand, and Newco and its subsidiaries, on the other hand, shall consult with each
other before issuing, and provide each other the opportunity to review and
comment upon, any press release or other public statements with respect to the
Merger or the other Transactions, and shall not issue any such press release or
make any such public statement prior to such consultation, except as may be
required by applicable Law, court process or by obligations pursuant to any
listing agreement with any national securities exchange.
SECTION 3.10. Standstill. From the Effective Time to the
fourth anniversary of the Effective Time, Parent shall not, and Parent shall not
permit any of its affiliates to, in any manner, whether publicly or otherwise,
directly or indirectly, in each case, without the prior written approval of
Newco (a) acquire, agree to acquire or make any proposal to acquire, directly or
indirectly, any securities or assets of Newco or any subsidiary of Newco, except
at the unsolicited specific written request of Newco, (b) propose to enter into,
directly or indirectly, any tender or exchange offer, merger or other business
combination or similar transaction involving Newco or any subsidiary of Newco,
except at the unsolicited specific written request of Newco, (c) form,
25
join or in any way participate in a "group" (within the meaning of Section
13(d)(3) of the Exchange Act) with respect to any securities of Newco or any
subsidiary of Newco, (d) enter into any discussions, negotiations, arrangements,
understandings or agreements (whether written or oral) with any other person
(other than financial advisors) regarding any possible purchase or sale of any
securities or assets of Newco or any subsidiary of Newco, (e) make, or in any
way participate, directly or indirectly, in any "solicitation" of "proxies" (as
such terms are used in the proxy rules of the SEC) to vote, or seek to advise or
influence any person with respect to the voting of, any securities of Newco or
any subsidiary of Newco, (f) call, or seek to call, a meeting of Newco's
shareholders or initiate or propose any shareholder proposal or execute any
written consent with respect to Newco, (g) otherwise act, alone or in concert
with others, to seek or attempt to control or influence the management, Board of
Directors of Newco or policies of Newco (except to the extent conduct or
settlement of litigation between R Diagnostics and the Company might be deemed
such an attempt), (h) disclose any intention, plan or arrangement inconsistent
with the foregoing or (i) advise, assist or encourage any other persons in
connection with any of the foregoing. During the applicable period covered by
this Section 3.10, Parent shall not, and Parent shall not permit any of its
affiliates to, without the prior consent of Newco (i) request, directly or
indirectly, that Newco or any of its Representatives amend or waive any
provisions of this Section 3.10 (including this sentence) or (ii) take any
action which could reasonably be expected to require Newco to make a public
announcement regarding the possibility of a business combination, merger or
similar transaction other than the Merger, the other Transactions and the
transactions contemplated by the Commercial Agreements.
SECTION 3.11. Transferred Customers. From and after the
Effective Time, Newco shall assume the Company's rights and benefits under
Article X of the Supply, Services and Support Agreement dated as of May 1, 2000
(the "Supply, Services and Support Agreement"), between the Company and R
Diagnostics with respect to matters that occurred prior to the Effective Time.
SECTION 3.12. New Patent Litigation. Promptly after the
Effective Time, Parent shall cause R Diagnostics
26
to comply with its obligations under Section 2.4(b) of the Ongoing Litigation
Agreement.
SECTION 3.13. I/R Agreements. Notwithstanding anything to the
contrary contained in this Agreement, no amendment, modification or waiver with
respect to any I/R Agreement entered into after the Effective Time shall result
in any Liability for Indemnifiable Losses or otherwise for Newco unless Newco
consents in writing to such amendment, modification or waiver.
SECTION 3.14. PCR License Payment. Newco hereby agrees to make
the PCR License Payment in accordance with the PCR License Agreement and the PCR
Services Agreement.
ARTICLE IV
Mutual Releases
SECTION 4.01. Mutual Releases. Effective immediately prior to
the Effective Time, in consideration of mutual releases, covenants, licenses,
agreements, rights and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, Parent, as to itself and its past,
present and future affiliates (including, from and after the Effective Time, the
Company), and its and their respective successors, predecessors, assigns, heirs,
officers, directors, members of the board of managers, members, managers,
employees, consultants and trustees, on the one hand (in each case, solely in
their capacities as such), and each of the Company and Newco, as to itself and
its past, present and future affiliates, and its and their respective
successors, predecessors, assigns, heirs, officers, directors, members of the
board of managers, members, managers, employees, consultants and trustees, on
the other hand (in each case, solely in their capacities as such), hereby (a)
releases, acquits and forever discharges the other and its past, present and
future affiliates and its and their respective successors, predecessors,
assigns, heirs, officers, directors, members of the board of managers, members,
managers, employees, consultants and trustees (in each case, solely in their
capacities as such), in respect of and from, and (b) agrees not to bring any
Action against the other and its past, present and future affiliates and its and
their respective successors, predecessors, assigns, heirs, officers, directors,
members of the board of managers, members, managers, employees, consultants and
27
trustees (in each case, solely in their capacities as such) related to or
arising our of, in the case of each of clause (a) and (b), any and all debts,
demands, Actions, causes of action, suits, accounts, covenants, Contracts,
agreements, torts, damages and any and all claims, defenses, offsets, Judgments,
demands and Liabilities whatsoever, of every name and nature, both at law and in
equity, known or unknown, suspected or unsuspected, accrued or unaccrued, which
have been or could have been asserted against such other person, which the
releasing person has or ever had which arise out of or in any way relate or are
incidental to events, circumstances or actions taken by such other person prior
to or as of the Effective Time; provided, however, that the foregoing general
release shall not (i) affect any person's right to enforce any Transaction
Agreement, any Commercial Agreement, any Newco I/R Agreement or any agreement
entered into between the Company, Newco or any of their respective affiliates,
on the one hand, and any of the R Parties or any of their respective affiliates,
on the other hand, after the date of this Agreement but prior to the Effective
Time or any provision herein or therein, in each case in accordance with its
terms or (ii) apply to any act or omission which constitutes fraud in the
inducement with respect to any Transaction Agreement or any Commercial
Agreement.
SECTION 4.02. Enforcement of Article IV. In the event of any
Action, at law or in equity, among the parties to this Agreement (including, for
purposes of this Section 4.02, affiliates, successors, assigns, heirs, officers,
directors, members of the board of managers, members, managers, employees,
consultants and trustees, in each case, covered by Section 4.01, that are third
party beneficiaries under Section 5.07) in which a party to such Action (the
"Prevailing Party") obtains a final and nonappealable order of a court of
competent jurisdiction that provides or states that the other party breached
Section 4.01, then the Prevailing Party shall be entitled to reimbursement from
the other party of its legal fees and expenses incurred in such Action.
ARTICLE V
Miscellaneous and General
SECTION 5.01. Effectiveness; Modification or Amendment. The
parties hereto agree that (a) Sections 4.01 and 4.02 will become effective
immediately prior to the
28
Effective Time and (b) each other provision of this Agreement will become
effective at the Effective Time and, for the avoidance of doubt, references to
the Company in such other provisions shall mean the Company after the Effective
Time. The parties hereto may modify or amend this Agreement only by written
agreement executed and delivered by duly authorized officers of the respective
parties.
SECTION 5.02. Termination. In the event the Merger Agreement
is terminated pursuant to its terms prior to the Effective Time, this Agreement
shall automatically and simultaneously terminate. In the event of such
termination, no party shall have any liability to any other party pursuant to
this Agreement. It is understood that consummation of the Merger shall not
constitute a termination of this Agreement.
SECTION 5.03. Notices. All notices, requests, claims, demands
and other communications under this Agreement shall be in writing and shall be
deemed given upon receipt by the parties at the following addresses (or at such
other address for a party as shall be specified by like notice) of a fax
followed by delivery of such notice by overnight courier (such courier being of
an international reputation):
(a) if to the Company (from and after the Effective Time) or
to Parent, to
Roche Holding Ltd
Xxxxxxxxxxxxxxxxx 000
XX-0000 Xxxxx
Xxxxxxxxxxx
Attention: Xxxxx Xxxxx
Fax: x00 00 000 0000
with a copy to:
Xxxxx Xxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx Xxxxx
Fax: (000) 000-0000
29
(b) if to the Company (prior to the Effective Time) or to
Newco, to
IGEN International, Inc.
00000 Xxxxxxxxxx Xxxxx
Xxxxxxxxxxxx, XX 00000
Attention: President
Fax: (000) 000-0000
with a copy to:
Cravath, Swaine & Xxxxx LLP
000 Xxxxxx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxx X. Xxxxxxx
Xxxxxx Xxxxxxxx
Fax: (000) 000-0000
SECTION 5.04. Interpretation. When a reference is made in this
Agreement to a Section, Exhibit, Schedule or party, such reference shall be to a
Section of, or an Exhibit, Schedule or party to, this Agreement unless otherwise
indicated. The 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" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation". The words "hereof", "herein", "hereby" and "hereunder" and words of
similar import when used in this Agreement shall refer to this Agreement as a
whole and not to any particular provision of this Agreement. The words "date
hereof" shall refer to the date of this Agreement. The term "or" is not
exclusive. The word "extent" in the phrase "to the extent" shall mean the degree
to which a subject or other thing extends, and such phrase shall not mean simply
"if". The definitions contained in this Agreement are applicable to the singular
as well as the plural forms of such terms. Any agreement or instrument defined
or referred to herein or in any agreement or instrument that is referred to
herein means such agreement or instrument as from time to time amended, modified
or supplemented. References to a person are also to its permitted successors and
assigns.
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SECTION 5.05. Severability. If any term or other provision of
this Agreement is invalid, illegal or incapable of being enforced by any
applicable Law, or public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any party. Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in an acceptable manner to the end that transactions contemplated
hereby are fulfilled to the extent possible.
SECTION 5.06. Counterparts. This Agreement may be executed in
one or more counterparts, all of which shall be considered one and the same
agreement and shall become effective when one or more counterparts have been
signed by each of the parties and delivered to the other parties. Each party
need not sign the same counterpart.
SECTION 5.07. Entire Agreement; Third-Party Beneficiaries.
This Agreement taken together with the other Transaction Agreements, the
Commercial Agreements and the Letter Agreement constitutes the entire agreement,
and supersedes all prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof and thereof. Except
for the provisions of Article II, Section 3.08 and Article IV, nothing contained
in this Agreement is intended to confer upon any person other than the parties
hereto and their respective successors and permitted assigns, any benefit, right
or remedy under or by reason of this Agreement, provided however, that any claim
under Article II by a Parent Indemnitee or a Newco Indemnitee, as the case may
be, that is not a party to this Agreement shall be brought on behalf of such
Parent Indemnitee or Newco Indemnitee, as the case may be, by the party to this
Agreement from which such Indemnitee's status as a Parent Indemnitee or Newco
Indemnitee is derived.
SECTION 5.08. Certain Obligations. Whenever this Agreement
requires any of the subsidiaries of any party to take any action, this Agreement
will be deemed to include an undertaking on the part of such party to cause such
subsidiary to take such action; provided, however, for
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the avoidance of doubt, at any time after the Effective Time, the Newco
Companies shall not be considered to be subsidiaries of the Company.
SECTION 5.09. Governing Law. This Agreement shall be governed
by, and construed in accordance with, the laws of the State of New York,
regardless of the laws that might otherwise govern under applicable principles
of conflicts of laws thereof.
SECTION 5.10. Assignment. Except as provided in Section 3.04,
neither this Agreement nor any of the rights, interests or obligations under
this Agreement shall be assigned, in whole or in part, by operation of law or
otherwise, by any of the parties without the prior written consent of the other
parties. Any purported assignment without such consent shall be void; provided,
however, the parties acknowledge and agree that the conversion of Newco in
accordance with Section 2.01 of the Restructuring Agreement and the continuation
of Newco as a result thereof shall be deemed not to be an assignment and shall
not require any consent of any party. Except as otherwise provided in Section
3.03(a), subject to the preceding sentences, this Agreement will be binding
upon, inure to the benefit of, and be enforceable by, the parties and their
respective successors and assigns.
SECTION 5.11. Enforcement; Consent to Service of Process. (a)
The parties agree that irreparable damage would occur and that the parties would
not have any adequate remedy either pursuant to the indemnification provisions
of Section 2.01 or 2.02, as the case may be, or at law in the event that any of
the provisions of this Agreement, including Section 3.03, were not performed in
accordance with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an injunction or
injunctions to prevent breaches of this Agreement and to enforce specifically
the terms and provisions of this Agreement in any New York state court or any
Federal court located in the State of New York, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition, each
of the parties hereto (i) consents to submit itself to the personal jurisdiction
of any New York state court or any Federal court located in the State of New
York in the event any dispute arises out of this Agreement, (ii) agrees that it
will not attempt to deny or defeat such personal jurisdiction by motion or other
request for leave from any
00
xxxx xxxxx, (xxx) agrees that it will not bring any Action relating to this
Agreement in any court other than any New York state court or any Federal court
located in the State of New York and (iv) waives any right to trial by jury with
respect to any Action related to or arising out of this Agreement.
(b) Parent hereby appoints the Authorized Agent as its
authorized agent upon whom process may be served in any Action arising out of or
relating to this Agreement or any Transaction that may be instituted in any
court described in Section 5.11(a). Parent agrees to take any and all reasonable
action, including the filing of any and all documents, that may be necessary to
establish and continue such appointment in full force and effect as aforesaid.
Parent agrees that service of process upon the Authorized Agent shall be, in
every respect, effective service of process upon Parent.
SECTION 5.12. Extension; Waiver. At any time the parties may
(a) extend the time for the performance of any of the obligations or other acts
of the other parties or (b) waive compliance with any of the agreements or
conditions contained herein. Any agreement on the part of a party to any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this Agreement to
assert any of its rights under this Agreement or otherwise shall not constitute
a waiver of such rights.
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IN WITNESS WHEREOF, Parent, the Company and Newco have duly executed
and delivered this Agreement, all as of the date first herein above written.
ROCHE HOLDING LTD,
By /s/ D. Xxxxx X. Xxxxx
____________________________________
Name: D. Xxxxx X. Xxxxx
Title: President and Chairman
By /s/ Xxxxx Xxxxxxxx
____________________________________
Name: Xxxxx Xxxxxxxx
Title: Chief Financial Officer
IGEN INTERNATIONAL INC.,
By /s/ Xxxxxx X. Xxxxxxxxxxx
____________________________________
Name: Xxxxxx X. Xxxxxxxxxxx
Title: Chairman and Chief Executive
Officer
IGEN INTEGRATED HEALTHCARE,
LLC,
By /s/ Xxxxxxx X. Xxxxxx
____________________________________
Name: Xxxxxxx X. Xxxxxx
Title: President and Chief Operating
Officer
