SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: (Date of earliest event reported): October 9, 1994
CORNING INCORPORATED
(Exact name of registrant as specified in its charter)
New York 1-3247 16-0393470
(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
One Riverfront Plaza, Corning, New York 14831
(Address of principal executive offices) Zip Code
Registrant's telephone number, including area code: (607) 974-9000
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Item 2. Acquisition or Disposition of Assets.
On October 9, 1994 pursuant to the terms of an Acquisition
Agreement and Plan of Reorganization dated as of September 8,
1994 (the "Agreement") between Corning Incorporated, the holders
of all of the outstanding shares of beneficial interest of Moran
Research Labs, a Massachusetts business trust doing business as
Bioran Medical Laboratory ("Bioran"), J. Richard Fennell, Ph.D.,
as trustee of Bioran, and S.A. Fennell Limited Partnership,
Corning completed the previously announced acquisition in a
tax-free transaction of all of the outstanding shares of beneficial
interest of Bioran in exchange for 5,960,970 shares of Corning Common
Stock, $.50 par value, as set forth in the Agreement.
On October 11, 1994 Bioran was merged with and into Corning
Bioran Inc., a wholly owned subsidiary of Bioran. Corning
anticipates contributing Corning Bioran Inc. to the capital of
Corning Life Sciences Inc., a wholly owned subsidiary of Corning,
in the near future.
Bioran Corning Inc., with operations in Massachusetts, New
Hampshire, Rhode Island and Vermont, specializes in clinical
laboratory testing for hospitals and physicians utilizing highly
automated laboratory technology which provides both extensive
routine and esoteric testing in all areas of the clinical
laboratory.
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Item 7. Financial Statements and Exhibits.
Financial Statements:
The submission of Bioran's audited financial statements within the 15-day
period as required by the Securities Exchange Act of 1934 is
impracticable. Corning expects to file the required financial
information as an amendment to this 8-KA no later than December 23, 1994.
Exhibits:
(2) Acquisition Agreement and Plan of Reorganization dated
September 8, 1994 between Corning Incorporated; Moran Research Labs,
doing business as Bioran Medical Laboratory; J. Richard Fennell, Ph.D.,
as trustee of Bioran Medical Laboratory; Susan E. Khoury Irrevocable Trust;
Linda M. Shea Irrevocable Trust; Kathleen M. Fennell Irrevocable
Trust; Patricia A. McEachern Irrevocable Trust; and S.A. Fennell
Limited Partnership.
(99) The Registrant's press release of October 10, 1994.
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SIGNATURES
Pursuant to the requirements of the Securities and Exchange of 1934,
the Registrant has duly caused this report to be signed on its behalf
by the undersigned thereunto duly authorized.
CORNING INCORPORATED
Registrant
Date: October 24, 1994 By: /s/ M. Ann Gosnell
M. Ann Gosnell
Assistant Secretary
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CORNING INCORPORATED
Index to Exhibits
Exhibit Description
2 Acquisition Agreement and Plan of Reorganization
dated September 8, 1994 between Corning
Incorporated; Moran Research Labs, doing business
as Bioran Medical laboratory; J. Richard Fennell,
Ph.D., as trustee of Bioran Medical Laboratory;
Susan E. Khoury Irrevocable Trust; Linda M. Shea
Irrevocable Trust; Kathleen M. Fennell Irrevocable
Trust; Patricia A. McEachern Irrevocable Trust;
and S.A. Fennell Limited Partnership.
99 The Registrant's press release of October 10,
1994.
ACQUISITION AGREEMENT AND PLAN OF REORGANIZATION
THIS ACQUISITION AGREEMENT AND PLAN OF REORGANIZATION
("Agreement") made as of this 8th day of September, 1994, by and
between Moran Research Labs, a Massachusetts Business Trust doing
business as Bioran Medical Laboratory ("Bioran"); J. Richard
Fennell, Ph.D., as trustee of Bioran (the "Trustee"); Susan E.
Khoury Irrevocable Trust, Linda M. Shea Irrevocable Trust,
Kathleen M. Fennell Irrevocable Trust, and Patricia A. McEachern
Irrevocable Trust, as Shareholders of Bioran (the "Existing
Shareholders"); S.A. Fennell Limited Partnership, a Massachusetts
limited partnership ("S.A. Fennell L.P."); and Corning
Incorporated, a New York business corporation ("Corning").
Bioran, the Trustee, the Existing Shareholders and S.A. Fennell
L.P. are also sometimes herein called the "Bioran Group."
RECITALS:
WHEREAS, Bioran exists by virtue of a Declaration of Trust dated
as of March 2, 1989 by and among the Trustee and the Shareholders
(by their predecessors) filed with the Secretary of State of the
Commonwealth of Massachusetts as of such date, which Declaration
was amended by a First Amendment filed October 17, 1991 (the
"Declaration of Trust"), and operates a clinical testing
laboratory in accordance therewith; and
WHEREAS, Corning desires to acquire all of the outstanding shares
of beneficial interest of Bioran ("Bioran Trust Stock") as
provided herein in exchange for shares of common stock of
Corning, par value $0.50 per share (the "Corning Common Stock")
in a transaction qualifying as a reorganization as defined in
Section 368(a)(1)(B) of the Internal Revenue Code of 1986 (the
"Code"), upon the terms and conditions hereinafter set forth.
WHEREAS, following the exchange, Corning may cause Bioran to
merge with and into CorSub (as hereinafter defined) pursuant to a
plan of merger qualifying as a reorganization as defined in
Section 368(a)(1)(F) of the Code.
NOW, THEREFORE, in consideration of the foregoing premises and of
the mutual and independent promises hereinafter set forth, and
subject to the various terms and conditions hereinafter set
forth, the Bioran Group and Corning hereby agree as follows:
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ARTICLE I. Description of the Transaction
1.1 Preliminary Matters.
(a) On the Closing Date (as hereinafter defined) but prior
to the Exchange Bioran shall acquire good and marketable title to
the real property listed in Schedule 1.1(a) from S.A. Fennell
L.P. pursuant an assignment of beneficial interest in exchange
for the issuance to S.A. Fennell L.P. of 8.41 shares of Bioran
Trust Stock and Bioran and S.A. Fennell L.P. shall have executed
the Real Estate Option Agreement.
(b) No later than one day prior to the Closing Date Bioran
shall sell, on a recourse basis, its net accounts receivable (the
amount of its accounts receivable from clinical laboratory
services in excess of the amount of its accounts payable from
clinical laboratory services) to Citibank N.A. or another bank
reasonably satisfactory to Corning for cash on terms reasonably
satisfactory to Bioran and Corning.
1.2 The Exchange.
(a) On the Closing Date Corning will acquire all (and not
less than all) of the outstanding shares of Bioran Trust Stock
(expected to be 282.41) in exchange (the "Exchange") for
5,960,967 shares of Corning Common Stock.
(b) At the Closing on the Closing Date Corning shall
deliver to the Escrow Agent, pursuant to the Escrow Agreement to
be executed pursuant to Section 6.1(c), the form of which is
attached hereto as Exhibit A (the "Escrow Agreement"), a
certificate representing 5% of the aggregate number of shares of
Corning Common Stock determined in (a) above, to be deposited
with the Escrow Agent on behalf of the Existing Shareholders.
(c) At the Closing on the Closing Date, the Existing
Shareholders and S.A. Fennell L.P., as the holders of all the
outstanding shares of Bioran Trust Stock ("Bioran Shareholders"),
shall tender to Corning their certificates representing all of
the outstanding shares of Bioran Trust Stock, together with duly
executed stock powers, in exchange for the delivery by Corning of
certificates representing shares of Corning Common Stock in
proportion to their holdings of Bioran Trust Stock excluding the
shares to be held in escrow as contemplated by Section 1.1(b).
Certificates representing shares of Corning Common Stock
delivered to Bioran Shareholders at Closing are being issued in a
private placement pursuant to Section 4(2) of the Securities Act
of 1933, as amended (the "1933 Act"), and are therefore exempt
from registration under the 1933 Act, and will bear the legend
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set forth below reflecting that such shares are not issued in a
transaction registered under the said Act, and cannot be resold
in the absence of a registration under said Act or pursuant to an
exemption thereto.
The Securities represented by this certificate have not been
registered under the Securities Act of 1933, as amended.
They may not be sold, transferred or otherwise dealt with in
a manner that would reduce the investment risk of the holder
prior to [anticipated date of first press release containing
at least 30 days of combined results of operations] and may
not be sold or transferred in the absence of registration or
an exemption therefrom under said Act.
(d) No certificates representing fractional shares will be
issued by Corning on account of the Exchange. Fractional
interests in shares of Corning Common Stock shall be eliminated
by rounding up to the next whole share interests of the
Shareholders.
1.3 The closing of the transactions provided for in Section
1.2 hereof (the "Closing") shall take place at the offices of
Lourie and Cutler, 60 State Street, Boston, Massachusetts, as of
11:59 p.m. on October 9, 1994, or such other date, time or place
as shall be mutually agreed upon by the Trustee and Corning (the
time and date of the Closing are referred to herein as the
"Closing Date").
ARTICLE II. Subsequent Transactions
Following the Closing Corning intends to cause Bioran and a newly
organized Massachusetts corporation that is a direct 100% parent
or subsidiary of Bioran ("CorSub") to execute, adopt and approve
an agreement of merger in the form of Exhibit B hereto pursuant
to the Massachusetts Business Corporation Law and to cause
Articles of Merger pursuant to the Agreement of Merger to be
filed with the Secretary of State of the Commonwealth of
Massachusetts thereby effecting the merger of Bioran with and
into CorSub (the "Merger"). The form of such Articles of Merger
are attached hereto as Exhibit B.
ARTICLE III. Bioran Group's Representations and Warranties
The Bioran Group hereby represents and warrants, jointly
and severally (except S.A. Fennell L.P., which represents and
warrants severally only as to the specific representations and
warranties relating to S.A. Fennell L.P.) to Corning as follows:
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3.1 Organization and Existence; Capitalization.
(a) Bioran is an entity duly organized and validly existing
under the laws of the Commonwealth of Massachusetts by virtue of
the Declaration of Trust, a true and complete copy of which as
amended to date, has been delivered to Corning, and has the full
power to carry on its business as it is now being conducted.
Apart from the Declaration of Trust, there are no other
instruments or agreements of any kind governing Bioran"s
existence or operation which have not heretofore been delivered
to Corning. Except as set forth on Schedule 3.1(a) hereto,
Bioran is qualified to do business in each jurisdiction where the
nature of such business, its assets or properties requires it to
do so except where the failure to so qualify would not have a
material adverse effect on its business, assets or properties.
J. Richard Fennell is the Trustee of Bioran.
(b) The Declaration of Trust and the laws of the
Commonwealth of Massachusetts permit Bioran to merge with and
into CorSub as contemplated by Article II.
(c) The number of shares of Bioran Trust Stock issued and
outstanding as of the date hereof on a pro forma basis after
giving effect to the consummation of the transaction referred to
in Section 1.1(a), together with the owners of such shares, are
set forth on Schedule 3.1(c) hereto. All of the outstanding
shares of Bioran Trust Stock are validly issued, fully paid and
non-assessable. Except as set forth on Schedule 3.1(c), there
are no outstanding options, agreements, contracts, calls,
commitments or demands of any character to which any of the
Bioran Group is a party relating to the Bioran Trust Stock that
either:
(i) obligates Bioran or the Trustee to (A) issue,
redeem, sell or purchase any Bioran Trust Stock or
any other security of Bioran, or (B) share the
profits of Bioran, or
(ii) restricts the transfer of, or otherwise relates to
transactions in, Bioran Trust Stock.
(d) S.A. Fennell L.P. is a duly organized limited
partnership existing in accordance with the laws of the
Commonwealth of Massachusetts and whose sole general partner is
Forest Realty Company, a Massachusetts business trust established
pursuant to a Declaration of Trust dated October 17, 1991.
3.2 Subsidiaries' Organization and Existence; Capitalization.
A "Subsidiary" shall mean any corporation, partnership or other
entity, wherever and however organized, in which Bioran, or the
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Trustee on behalf of Bioran, owns directly or indirectly at least
50% of the voting stock, equity or beneficial interest, is the
general partner of, or otherwise controls the management of, by
having the right or ability to designate a majority of the
directors or members of the governing body thereof, whether by
agreement or otherwise. Bioran does not have any Subsidiaries.
3.3 Affiliated Companies' Organization and Existence;
Capitalization. An "Affiliated Company" shall mean any
corporation, partnership or other entity, other than a
Subsidiary, wherever or however organized, in which Bioran, or
the Trustee or Bioran Shareholders on behalf of Bioran, owns
directly or indirectly at least 20% of the voting stock, equity
or beneficial interest or has the right to control the board of
directors, governing body or management of any such company
whether by agreement or otherwise. Bioran does not have any
Affiliated Companies.
3.4 Ownership of Bioran Trust Stock; Authority to Execute and
Perform Agreement.
(a) All persons or entities owning, equitably and
otherwise, Bioran Trust Stock, are identified in Schedule 3.1(c)
and hold such Bioran Trust Stock free and clear of all liens,
encumbrances and claims and no Bioran Shareholder has any
outstanding claim, judgment or lien of any nature whatsoever
against it.
(b) Each member of the Bioran Group has the full legal
right, power and authority to enter into, execute and deliver
this Agreement, the Escrow Agreement, the Registration Rights
Agreement (in the form of Exhibit C attached hereto), the Real
Estate Option Agreement (in the form of Exhibit D hereto) and the
Affiliate"s Agreement (in the form of Exhibit E attached hereto)
in each capacity in which such member is executing each such
agreement and to perform fully his, her or its obligations
hereunder and thereunder. This Agreement has been duly executed
and delivered by each member of the Bioran Group and is the valid
and binding obligation of each member enforceable against it in
accordance with its terms. Other than their execution and
delivery of this Agreement to Corning, no other corporate or
comparable proceedings are necessary on the part of any member of
the Bioran Group to authorize this Agreement or the transactions
contemplated hereby. Except as set forth in Schedule 3.4, the
execution and delivery of this Agreement and the other agreements
identified above, the consummation by the Bioran Group of the
transactions contemplated hereby and thereby (including the
Merger) and the performance by the Bioran Group of this Agreement
and the other agreements identified hereinabove will not::
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(i) conflict with or result in a breach or default of
or constitute or result in a default under any of
the terms, conditions or provisions of the
Declaration of Trust or other governing
instruments, if any of Bioran;
(ii) require the further approval or consent of any
federal, state, county, local court or other
governmental or regulatory body or the approval or
consent of any other person other than compliance
with the Hart-Scott-Rodino Antitrust Improvements
Act of 1976 (the "H-S-R Act") and the obtaining of
such consents as listed on the Schedule 3.11
hereto; or
(iii) conflict with or result in any breach or violation
of any of the terms and conditions of, or
constitute a default (or an event which with
notice or lapse of time or both constitute a
default) under or a violation of, any statute,
regulation, order, judgment or decree applicable
to Bioran, or of any material instrument, contract
or other agreement to which Bioran or the Trustee
is a party or to which Bioran is bound or subject.
3.5 Financial Statements.
(a) Schedule 3.5(a) hereto consists of the proforma,
unaudited consolidating balance sheet of Bioran (including the
real estate referred to in Schedule 1.1(a) but excluding the real
estate not used in the clinical laboratory business and any non-
clinical laboratories activities) as of December 31, 1993, and
the related consolidating profit and loss statement of the Bioran
clinical laboratories business for the 12-month period then ended
(the "1993 Financial Statements"). Except as noted thereon, the
1993 Financial Statements fairly present the financial position
of the clinical laboratories business of Bioran at December 31,
1993 and the results of its operations for the year ended
December 31, 1993, all in conformity with generally accepted
accounting principles applied on a basis consistent with prior
periods. Except as shown separately on Schedule 3.5(c), no
dividends or other distributions have been made by Bioran to its
Shareholders since December 31, 1993.
(b) Schedule 3.5 (b) hereto consists of the proforma,
unaudited consolidating balance sheet of Bioran (including the
real estate referred to in Schedule 1.1(a) but excluding the real
estate not used in the clinical laboratory business and any non-
clinical laboratories activities) as of June 30, 1994, the
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related consolidating profit and loss statements of the Bioran
clinical laboratories business for the 6-month period then ended
(the "1994 Financial Statements"). Except as noted thereon, the
1994 Financial Statements fairly present the financial position
of the clinical laboratories business of Bioran at June 30, 1994
and the results of its operations for the 6-month period ended
June 30, 1994, all in conformity with generally accepted
accounting principles applied on a basis consistent with prior
periods. The Accounts Receivable as reflected on the 1994
Financial Statements are all beneficially owned and valid claims
for reimbursement and adequate reserves and allowances have been
provided. All liabilities, including contingent liabilities, are
properly reflected or disclosed in the 1993 and 1994 Financial
Statements.
3.6 Taxes.
(a) Bioran has delivered to Corning true and complete
copies of its federal income and state and local income tax
returns for its tax years ended December 31, 1991, 1992 and 1993.
Bioran has duly filed or secured appropriate extensions for all
tax reports and returns required to be filed by it and has duly
paid all amounts due and payable or have made adequate provision
for all taxes and other related charges including those not yet
payable (including interest and penalties due or claimed to be
due from it) by foreign, federal, state or local taxing
authorities (including, without limitation, those due in respect
of its properties, income, licenses, sales and payrolls). Except
as set forth on Schedule 3.6, no taxing authority has audited any
portion of a tax return relating to Bioran since 1987, and there
are no notices of audit, pending questions relating to, or claims
asserted for, taxes or assessments received by or made against
Bioran.
(b) Pursuant to an election made on or before December 31,
1986, for U.S. Federal income tax purposes Bioran has qualified
on a continuous basis as a corporation taxed under Subchapter S
of the Internal Revenue Code ("S Corporation") for all periods
beginning on January 1, 1987 and ending on the Closing Date.
During the entire period of its treatment as a qualified S
Corporation, Bioran has not been liable for any S Corporation
level tax under Sections 1374 and 1375 of the Internal Revenue
Code.
3.7 Machinery and Equipment; Supplies. Schedule 3.7 consists of
lists maintained by Bioran for financial reporting purposes of
all machinery, equipment, furniture, motor vehicles and other
tangible assets, other than inventories of supplies held in the
ordinary course of business, owned or held under lease by Bioran
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on June 30, 1994 and which are normally capitalized by Bioran.
Bioran does not claim ownership or any other rights in the items
of personal furniture, art, artifacts, and filing cabinets in the
offices presently occupied by J. Richard Fennell, Kathleen M.
Fennell, the adjacent conference room, the secretarial office
occupied by Virginia Yerardi, or in the upstairs "Projection
Room" in the building at 415-425 Massachusetts Ave., or in the
original SMAC analytical machine presently stored in the garage.
Except as described in Schedule 3.7, such machinery, equipment,
furniture, motor vehicles and other tangible assets owned or used
by Bioran and presently used in their businesses, are in good
operating condition and repair, subject to ordinary wear and
tear. All manufacturers' warranties, users' manuals, and
maintenance documents in the possession of Bioran regarding all
machinery, equipment, motor vehicles and other tangible assets as
of the date of this Agreement are maintained at the locations of
such assets. All maintenance, service, product recall, and
manufacturers' upgrades have been followed, installed or
otherwise implemented on all machinery, equipment, motor vehicles
and other tangible assets subject to this Agreement (the above-
identified tangible assets and the Software identified in Section
3.10 below are herein called the "Assets"). The inventories of
supplies held by Bioran and included in the 1994 Financial
Statements are usable in the ordinary course of its business.
3.8 Business and Ownership of Assets. Except as described in
Schedule 3.8, Bioran is engaged in providing clinical testing
services and is not engaged directly or indirectly in any other
business activity. S.A. Fennell L.P. was established to hold,
has in the past and at presently holds, only real estate, cash
and cash equivalents listed on Schedule 3.8 and engages in no
other business and has no employees, properties, liens, loans,
liabilities, operations, obligations or undertakings of any
nature except as set forth thereon. Bioran or the Trustee on
Bioran"s behalf, has (or, in the case the properties listed on
Schedule 1.1, will have at the Closing Date) good and marketable
title to, or holds under lease, or under reagent-use agreements,
all of its respective Assets, free and clear of all restrictions,
liens, claims and other encumbrances other than Permitted Liens.
No other assets are used by Bioran, or are necessary, in the
conduct of its business as presently carried on. For purposes of
this Agreement, Permitted Liens shall mean (a) materialmen's,
mechanics', carriers', worker's, repairmen's and other similar
liens arising from or incurred in the ordinary course of
business, or statutory landlord's liens under leases to which
Bioran is a party, with respect to which the underlying
obligation is not in default or such obligation or lien is being
contested in good faith, (b) the rights of third parties with
respect to inventory or work in progress under orders or
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contracts entered into by Bioran in the ordinary course of
business, (c) liens securing indebtedness which are discharged in
accordance with stated credit terms set forth in instruments
listed on Schedule 3.11 or omitted therefrom in accordance with
Section 3.11, (d) liens that do not materially detract from or
materially interfere with the present use of the properties or
assets subject thereto or affected thereby, or otherwise
materially impair present business operations in which such
properties are used or materially interfere with the sale, or
materially detract from the value, of any properties held for
sale, (e) as reflected in financial statements or the notes
thereto delivered pursuant to Sections 3.5 or 6.1 hereof, and (f)
liens for taxes not yet delinquent, or the validity or amount of
which are being contested in good faith.
3.9 Client List. Schedule 3.9 includes complete and accurate
listings of all of the clients (without names and addresses of
clients which will be only provided at Closing) for whom Bioran
performed clinical laboratory testing or other services with a
cumulative invoice value of at least $1,000 during June, 1994,
including the name and address of each such client and complete
and accurate statements of sales for each during June, 1994.
Except as set forth on Schedule 3.9, no client on such list has,
by written notice or by oral declaration, advised Bioran or the
Trustee, or an officer or senior executive of Bioran to the
knowledge of Trustee, that it intends to terminate its business
relationship with Bioran, except any clients whose average
monthly referrals to Bioran during the twelve months ended June
30, 1994 do not exceed $10,000 individually and do not exceed
$250,000 in the aggregate for all such excluded clients.
3.10 Computer Programs and Software. Set forth on Schedule 3.10
is a list and description of all material computer programs and
software currently being used by Bioran for laboratory and
business systems but excluding off-the-shelf commercially
available systems owned or licensed to Bioran (inclusively, the
"Software").
3.11 Contracts and Commitments. Set forth on Schedule 3.11
hereto are complete and accurate lists as of the date hereof of
the following:
(a) Sales contracts of Bioran not terminable without
penalty on 60 days' notice which individually provide for the
rendering of future services in excess of $10,000;
(b) Bids and sales proposals of Bioran not terminable
without penalty on 60 days" notice which individually provide for
the rendering of services in excess of $10,000;
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(c) Purchase orders and purchase commitments of Bioran not
terminable without penalty on 60 days" notice which individually
provide for future purchases in excess of $25,000;
(d) Personal property leases and other rental, use or
service arrangements of Bioran not terminable without penalty on
60 days" notice which individually requires payment by Bioran
over its remaining life of more than $25,000 in the aggregate;
(e) Real property leases and similar contracts and
arrangements not terminable without penalty on 60 days" notice
whereby Bioran leases or rents any land, building, facility,
service center or other interest in realty which requires payment
by or to Bioran or over its remaining life of more than $25,000
in the aggregate (the "Business Premises Leases");
(f) All laboratory management agreements, compensation
arrangements (as defined in the Omnibus Budget Reconciliation Act
of 1989 - the "Stark law," as amended, 42 U.S.C.A. 1395(nn)) with
referring physicians, indemnity or guaranty arrangements,
business acquisition agreements, licensing agreements,
nondisclosure agreements, non-compete agreements, joint-venture
agreements, and commission agreements;
(g) All agreements between Bioran and Trustee, with any
Bioran Shareholder or among Bioran Shareholders (collectively
"Shareholder Agreements") or any officer or director of Bioran;
(h) All other material contracts, agreements,
understandings, commitments, leases, mortgages, notes, bonds,
loans or other instruments, whether written or oral (other than
those specifically included or excluded by subsection (a) through
(g) above) and all amendments, consents, waivers, side letters
and commitments related thereto, to which Bioran is a party and
which is not terminable without penalty by Bioran on 60 days" or
less notice and which individually requires payment by Bioran
over its remaining life of more than $25,000; and
(i) Any agreements of S.A. Fennell L.P. of the nature
described in clauses (a) through (h) above to which Bioran or its
properties may be bound or affected at the Closing Date, whether
by reason of the transactions contemplated by Section 1.1(a) or
otherwise.
Items to be set forth pursuant to (a) through (i) above being
hereinafter collectively referred to as the "Contracts".
Contracts excluded from Schedule 3.11 solely by reason of dollar
limitations do not obligate Bioran to more than $1 million of
cost or expense in the aggregate and none of such Contracts so
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excluded is material to the business of Bioran. Except as set
forth in Schedule 3.11, all Contracts are valid, binding and in
full force and effect and have not been amended or modified from
the forms thereof provided to Corning. No party to any Contract
is, to the knowledge of Bioran or the Trustee, in default thereof
and to the knowledge of Bioran or the Trustee there exists no
condition or event which, after notice or lapse of time or both,
would constitute a default by any such party, except as to
matters which are immaterial to the performance of any such
Contract. Except as separately identified in Schedule 3.11
(which Schedule shall be updated to the Closing Date), no
Contract either requires another party's consent to, or shall be
terminable by reason of, the transactions contemplated hereby,
including the Merger. Bioran and the Trustee do not know or have
no reason to know of any cancellation, or threat to cancel or not
to renew or extend, any Contract or of any reasonable basis for
any other party thereto to cancel any Contract to which Bioran is
a party, other than Contracts whose cancellation, nonrenewal or
nonextension is not material to Bioran. For the purposes of the
foregoing sentence, knowledge or reason to know shall mean a
written declaration of a party having a Contract with Bioran or
an unequivocal oral statement by such party to the Trustee, an
officer or senior executive of Bioran to such effect. Bioran has
furnished or made available to Corning complete and accurate
copies of all Contracts. Bioran is not a party to or bound by
any agreement restricting the ability of Bioran or any of its
affiliates from freely engaging in any business or competing
anywhere in the world.
3.12 Intellectual Property Rights; Nondisclosure of Proprietary
Information.
(a) Set forth on Schedule 3.12 is a list of all trade
names, assumed names, service marks, trademarks, logos, patents,
copyrights and other intellectual property rights of Bioran.
Bioran holds all the intellectual properties it uses in its
businesses free and clear of all liens and claims and requires no
rights in any such properties that it does not have to conduct
its businesses as presently conducted.
(b) Except as set forth on Schedule 3.12, Bioran has not
disclosed any proprietary or confidential information, including,
but not limited to, lists of current or prospective customers,
financial statements, trade secrets, methods by which the
businesses of Bioran are or have been conducted and methods by
which the customers or business of Bioran are or have been
obtained, to any third party, except in the ordinary course of
business, to persons or entities such as the attorneys or
accountants of Bioran or the Internal Revenue Service. For
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purposes of this Agreement, disclosure of information to parties
interested in purchasing some or all of the stock or assets of
Bioran or entering into a partnership, consolidation, joint
venture, or other business arrangement whereby the third party
would share in the profits generated by the confidential and
proprietary information of Bioran shall not be considered
transactions in the ordinary course of business.
3.13 Employees; Employee Benefits. Set forth on Schedule 3.13
hereto are the following:
(a) Employees. A complete and substantially accurate list
(without names which will only be provided at Closing) of the
titles, dates of hire and rates of pay of all salaried Bioran
employees as of the date hereof. Set forth separately on
Schedule 3.13, is a list of all written and verbal employment or
consultant agreements existing to which Bioran is bound;
(b) Termination Pay Policy. A description of the
termination or severance pay policy of Bioran;
(c) Benefit Plans. A description of each employee benefit
or compensation plan, including without limitation, pension,
retirement, deferred compensation, profit sharing, bonus or
incentive, medical, dental, health insurance and life insurance
or other employee benefit plans of Bioran; and
(d) Vacation Pay. A complete and substantially accurate
list (without names which will only be provided at Closing) of
all vacation pay accrued as of June 30, 1994 in respect of Bioran
employees. Except as set forth in Schedule 3.13, Bioran is not a
party to, bound by, nor does it maintain or make any contribution
to any employment agreement, pension, retirement, deferred
compensation, profit sharing, bonus or incentive plan, medical,
dental or other health insurance plan, life insurance plan, or
other employee benefit plan or program (whether or not legally
binding), including, without limitation, any "employee benefit
plan" (as defined under Section 3(3) of the federal Employee
Retirement Income Security Act ("ERISA"), under which employees
of Bioran are eligible to participate or derive a benefit
(collectively "Employee Plans" and individually, an "Employee
Plan"). Bioran has furnished or made available to Corning
complete and accurate copies of all the Employee Plans (and, in
the case of any unwritten Employee Plans, written descriptions
thereof) listed on Schedule 3.13, all trust or other funding
agreements, all amendments thereto, and all favorable
determination letters issued by the Internal Revenue Service with
respect to the Employee Plans and amendments thereto. Each
Employee Plan complies in all material respects with all
<PAGE>
applicable laws, including, without limitation, ERISA and the
Internal Revenue Code of 1986, as amended. Bioran does not
maintain any defined benefit pension plan and does not contribute
and is not required to contribute to any multi-employer plan.
3.14 Insurance. Schedule 3.14 sets forth a list of all insurance
policies held by or for the benefit of Bioran. All such policies
are in full force and effect and there are no notices or threats
of cancellation thereunder, and there are no unresolved claims
pending by Bioran thereunder.
3.15 Permits, Licenses and Compliance with Laws. Bioran has all
permits, licenses and approvals from federal, state, local and
foreign governmental and regulatory bodies, including, without
limitation, laboratory licenses issued for participation in the
Medicare and Medicaid programs, the CLIA license and all state
laboratory licenses (collectively the "Permits"), necessary for
the conduct of its business, and such Permits are valid and
sufficient for all business presently conducted by Bioran.
Schedule 3.15 lists all claims and notices that Bioran has
received since January 1, 1991 alleging that either Bioran is not
in compliance with the terms of any such Permits and with all
requirements, standards and procedures of the federal, state,
local and foreign governmental regulatory bodies which issued
them or of any limitation or proposed limitation on any
laboratory license. Bioran is, and has been for 3 years prior to
the Closing Date, in substantial compliance with all federal,
state and local laws, ordinances, codes, regulations, orders,
requirements, standards and procedures which are applicable to
its business (collectively "Laws") and, neither Trustee nor
Bioran, nor anyone on their behalf, has received any notices or
has any knowledge of any violations of any Laws regarding the
operation of the businesses and Assets of Bioran. Except as
disclosed on Schedule 3.15, neither Trustee nor Bioran, nor any
of its shareholders, directors, officers, representatives, agents
or employees, have engaged in any conduct, or have knowledge of
any circumstances, which could lead to an investigation, or which
has lead to any investigation into any activity, conduct or
arrangement for rebates, kickbacks or other forms of compensation
that could be determined to be illegal, unlawful or otherwise
prohibited by any federal, state, municipal or other governmental
agency or instrumentality and, without limiting the generality of
the foregoing, neither Trustee nor Bioran, nor any of its
shareholders, directors, officers, employees, representatives or
agents, on behalf of or for the benefit of Bioran has solicited
or obtained specimen referrals in violation of State or Federal
law. Billing by Bioran under the Medicare and Medicaid programs
has been true and correct in all material respects and in
substantial compliance with applicable laws, regulations and
<PAGE>
policies, and for all other billings has been true and correct in
all material respects.
Except as set forth in Schedule 3.15, neither Trustee nor Bioran,
nor any of its shareholders, directors, officers,
representatives, agents or employees has been convicted of,
charged with or, to the knowledge of any member of the Bioran
Group, investigated for a Medicare, Medicaid or state health
program related offense or within the past three years convicted
of, charged with or, to the knowledge of any member of the Bioran
Group, investigated for a violation of federal or state law
related to fraud, theft, embezzlement, breach of fiduciary
responsibility, financial misconduct, obstruction of an
investigation or controlled substances, or has been excluded or
suspended from participation in Medicare, Medicaid or any federal
or state health program or within the past three years has been
subject to any order or consent decree of, or criminal or civil
fine or penalty imposed by, any court or governmental agency
relating to Bioran or its businesses.
Bioran"s use of the Business Premises (as defined in Section 3.18
below) leases are valid and permitted uses of said premises which
in no way violate any applicable planning or zoning laws, rules
or regulations, or any other agreements, documents or instruments
respecting such premises. Neither the Trustee nor Bioran has
notice or knowledge of any reason why occupancy and use of such
premises by Corning and its subsidiaries and affiliates following
Closing, in the same manner as such have been operated by Bioran,
would not be valid, permitted and non-violative. The Business
Premises leases comply with all requirements of the Stark law.
3.16 Proficiency Testing and Inspection Reports. There have been
no inspections of, or proficiency tests performed by, Bioran for
which Bioran has not yet received a report or results.
3.17 Litigation and Claims. Set forth on Schedule 3.17 is a list
and description of (i) every claim, complaint, suit, action and
judicial, regulatory, arbitral or governmental action, proceeding
or investigation pending, or to the knowledge of Bioran,
threatened against Trustee or Bioran or any of its shareholders,
directors, officers, representatives, agents, or employees in
relation to Bioran, as the case may be, and (ii) each such claim,
complaint, suit, action, proceeding or investigation settled,
adjudicated or otherwise disposed of at any time on or after
January 1, 1991. Bioran is not aware of any basis for any
material claim against Bioran, whether or not such a claim has
been asserted.
<PAGE>
3.18 Real Estate. Set forth on Schedule 3.18 are descriptions of
all of Bioran"s owned and leased real property (the "Business
Premises"), and all leases with respect to such real property.
Bioran holds marketable title to each real property facility
listed as owned by it on Item 1 of Schedule 3.18. As of
January 1, 1994, Bioran has conveyed out as a dividend all of the
real estate assets held by it but not used in the clinical
testing laboratory business of Bioran. As of the date hereof
S.A. Fennell L.P. holds (through a nominee trustee), and at the
Closing Date Bioran will hold (through a nominee trust and
subject to the Real Estate Option Agreement) marketable title to
the real property listed in Item 2 of Schedule 3.18 (the
"Cambridge Facility"). The estimated fair market value of the
real property listed in Item 2 of Schedule 3.18 is $5,500,000.
The property listed in Item 3 of Schedule 3.18 is leased by
Bioran. All restrictions and encumbrances on each Business
Premises other than Permitted Liens are set forth on Schedule
3.18. The roof, structure and all mechanical systems in and on
the Cambridge Facility, each other owned laboratory facility, and
each leased laboratory facility for which Bioran or S.A. Fennell
L.P. has responsibility for maintenance or repair, including,
without limitation, electrical, plumbing, heating, ventilating,
air conditioning, water supply and sewage disposal systems,
together with all fixtures and appliances, are in good condition
and working order and free from any material defects. Each of
Bioran and S.A. Fennell L.P. is in material compliance with all
applicable certificates of occupancy, governmental codes, zoning
laws and other legal requirements with respect to each such
facility.
3.19 Environmental Matters. (a) Neither Trustee, Bioran nor
S.A. Fennell L.P., nor anyone on their behalf, has received any
notice or has any knowledge of any violations of any Laws
regarding the Business Premises. Bioran and S.A. Fennell L.P.
and, to the knowledge of Trustee and Bioran after due inquiry and
investigation, all current and previous owners of the Business
Premises, have complied with all laws regarding the storage and
removal of hazardous or toxic substances and medical wastes.
Bioran has not caused the use, storage, handling or release (as
that term is defined below) of any hazardous substance (as
defined below) to occur on the Business Premises. To the best of
Trustee"s and Bioran"s knowledge, after due inquiry and
investigation, the same never has occurred on the Business
Premises. Bioran"s Business Premises are not subject to any
federal, state or local "superfund" or other lien proceeding,
claim, liability or action for the cleanup, removal (as defined
below), or remediation of any such hazardous substance from the
Business Premises or from any other real property owned or
controlled by Bioran, or in which Bioran has any interest, legal
<PAGE>
or equitable, and Bioran"s Business Premises are not subject of
any notice or notification regarding same, or subject to the
threat or likelihood thereof.
The terms "hazardous substance", "release" and "removal" as used
herein shall have the same meaning and definition as set forth in
paragraphs (14), (22) and (23), respectively, of Title 42 U.S.C.
Section 9601 et seq. and any applicable state laws, as well as
regulations provided thereunder, however, the term "hazardous
substance" as used herein also shall include: (i) "hazardous
waste" as defined in paragraph (5) of 42 U.S.C. Section 6903;
(ii) "petroleum" as defined in paragraph (8) of 42 U.S.C. Section
6991; (iii) any asbestos containing material; (iv) any
polychlorinated biphenyls or PCB's; and (v) radon.
The term "superfund" as used herein means the Comprehensive
Environmental Response Compensation and Liability Act, as
amended, being Title 42 U.S.C. Section 9601 et seq., as amended,
and any similar state statute or local ordinance applicable to
Bioran"s Business Premises, and all rules and regulations
promulgated, administered and enforced by any governmental agency
or authority pursuant thereto.
(b) Neither Bioran nor S.A. Fennell L.P. has any
Underground Storage Tanks (as defined below) for which Bioran or
S.A. Fennell L.P. may have responsibility under law or contract
for maintenance or removal located upon and/or which serve
Bioran"s Business Premises at the locations listed on Schedule
3.18. "Underground Storage Tank" for the purposes of this
Agreement shall mean any one or combination of tanks, including
appurtenant pipes, lines, fixtures and other related equipment,
used to contain an accumulation of hazardous substances (as
defined in subparagraph 3.19(a) hereof), the volume of which,
including the volume of the appurtenant pipes, lines, fixtures
and other related equipment, is ten (10%) percent or more below
the ground.
3.20 Corporate Documents and Minute Books; Officers and
Directors. The minutes of Corporate Proceedings, Stock Transfer
Registers, Certificates of Incorporation and By-Laws of Bioran
delivered to Corning for inspection are correct and complete and
accurately reflect all actions and proceedings of the Trustee(s)
and Shareholders of Bioran to date. Schedule 3.20 identifies by
name and address each trustee, director and officer of Bioran who
has served as such since January 1, 1988.
3.21 Bioran and S.A. Fennell L.P. Affiliates. Schedule 3.21
lists the affiliates of Bioran and S.A. Fennell L.P.
("Affiliates").
<PAGE>
3.22 Bank Accounts. Schedule 3.22 is a list of all bank accounts
or other investment accounts, lock boxes and other depositories
of Bioran identifying bank or custodian, branch and account
number, as well as the authorized signatories thereto.
3.23 Brokers. Negotiations relative to this Agreement and the
transactions contemplated hereby have been carried on by Bioran
and S.A. Fennell L.P. without the assistance of any broker or
finder and no brokerage or finders' commission or fee is payable
by Bioran or S.A. Fennell L.P. to any other party on account of
this Agreement or the transactions contemplated hereby.
3.24 Adverse Change. Since July 31, 1994 , except as disclosed
on Schedule 3.24 hereto, neither Bioran nor S.A. Fennell L.P. has
suffered any adverse change in its financial condition, assets,
liabilities or business except changes in the ordinary course of
business which in the aggregate have not been materially adverse,
nor any damage, destruction or loss, whether or not covered by
insurance of any material portion of the assets reflected in the
1994 Financial Statements.
3.25 Continuity of Interest. The Bioran Shareholders have no
present plan or intention to sell or otherwise dispose of the
Corning Common Stock to be received in the Exchange.
3.26 Disclosure. Except as such representation or warranty may
be qualified herein to the best knowledge of any member of the
Bioran Group, no representation or warranty by any member of the
Bioran Group nor any written statement or certificate furnished
to Corning pursuant hereto, contains any untrue statement of a
material fact or omits to state a material fact necessary to make
the statements contained herein and therein not misleading.
ARTICLE IV.Corning's Representations and Warranties
Corning hereby represents and warrants to each member of the
Bioran Group as follows:
4.1 Capitalization of Corning. The authorized capital stock of
Corning consists of 10,000,000 shares of Series Preferred Stock,
par value $100 each, and 500,000,000 shares of Corning Common
Stock. As of July 14, 1994, 257,905 shares of Series B 8%
Convertible Preferred Stock, $100 par value per share were issued
and outstanding. As of July 14, 1994, 213,736,161 shares of
Corning Common Stock were issued and outstanding, 15,802,292 shares
of Corning Common Stock were reserved for issuance in connection
with employee stock option plans, convertible securities and an
incentive stock plan, and 9,583,698 shares were reserved for
issuance in connection with the 6% Convertible Monthly Income
<PAGE>
Preferred Securities of Corning Delaware, L.P. All of the
outstanding shares of Corning Common Stock are, and the shares of
Corning Common Stock to be issued to Bioran Shareholders will be,
when issued, duly authorized, validly issued, fully paid and
nonassessable.
4.2 Organization and Good Standing. Corning is a corporation duly
organized, validly existing and in good standing under the laws of
the State of New York and has full corporate power to carry on its
business as it is now being conducted, and is duly qualified to do
business and is in good standing in each jurisdiction in which the
character of the properties owned or leased by it or the nature of
the business transacted by it makes such qualification necessary.
4.3 Authority to Execute and Perform Agreement. Corning has the
full legal right, power and authority to enter into, execute and
deliver this Agreement, the Escrow Agreement and the Registration
Rights Agreement and to perform fully its obligations hereunder and
thereunder. This Agreement, the Escrow Agreement and the
Registration Rights Agreement have been or will be duly executed
and delivered by Corning and are or will be the valid and binding
obligations of Corning enforceable in accordance with their terms.
This Agreement has been approved by the Executive Committee of the
Board of Directors of Corning and no other corporate proceedings
(other than any requisite actions by the Board of Directors of
CorSub) are necessary to authorize this Agreement and the other
agreements identified herein above or the transactions contemplated
hereby or thereby. The execution and delivery of this Agreement
and the other agreements identified herein above, the consummation
of the transactions contemplated hereby and thereby and the
performance by each Corning Party of this Agreement and the
agreements identified hereinabove will not:
(a) conflict with or result in a breach of or constitute or
result in a default under any of the terms, conditions or
provisions of the Certificate of Incorporation, By-Laws or other
governing instruments of Corning;
(b) require the further approval or consent of any foreign,
federal, state, county or local court or other governmental or
regulatory body, or the approval or consent of any other person
(other than compliance with the H-S-R Act); or
(c) conflict with or result in any breach or violation of any
of the terms and conditions of, or constitute a default (or an
event which with notice or lapse of time or both would constitute
a default) under, any statute, regulation, order, judgment or
decree applicable to Corning, or any instrument, contract or other
<PAGE>
agreement to which Corning is a party or by or to which Corning is
bound or subject.
4.4 Financial Statements. Corning's annual report on Form 10-K
for the fiscal year ended January 2, 1994 (the "Corning 1993
10-K"), and its quarterly reports on Form 10-Q for the periods
ended March 27, 1994 and June 19, 1994 (the "Corning 1994 10-Qs"),
and all 8-K's filed by Corning since January 2, 1994 (the "Corning
1994 8-K"s) and its 1994 Annual Proxy Statement, copies of which
have been furnished to Bioran were each, on the date of their
respective filings with the Securities and Exchange Commission,
accurate in all material respects and did not include any untrue
statement of material fact or omit to state a material fact
necessary to make the statements therein not misleading. The
financial statements included in the Corning 1993 10-K and the
Corning 1994 10-Qs present fairly the financial position of Corning
and its subsidiaries at such dates and the results of their
operations and cash flows for the periods then ended, in conformity
with generally accepted accounting principles applied on a
consistent basis throughout the periods covered by such statements,
except as set forth in the report of independent accountants
relating to the financial statements included in the Corning 1993
10-K.
4.5 Litigation. Except as disclosed in the Corning 1993 10-K and
the Corning 1994 10-Qs and 8-Ks, there are no suits, actions or
legal, administrative, arbitration or other proceedings or
governmental investigations or other controversies pending, or to
the knowledge of Corning threatened, or as to which Corning has
received any notice, claim or assertion, which involves a potential
cost or liability to Corning which would singly or in the
aggregate, materially and adversely affect the financial condition,
result of operations, business or prospects of Corning and its
subsidiaries considered as a whole. Corning is not in default with
respect to any order, writ, injunction or decree of any court or
before any federal, state, municipal or other governmental
department, commission, board, bureau, agency or instrumentality,
domestic or foreign, affecting or relating to it which is material
to the financial condition, results of operations or business of
Corning and its subsidiaries considered as a whole.
4.6 Continuity of Business. It is the present intention of
Corning (i) to cause Bioran (and, if the Merger is consummated, to
cause CorSub) to continue the business that Bioran currently
conducts and (ii) not to dispose of the shares of or liquidate
Bioran (other than pursuant to the Merger), except that Corning may
contribute the shares of Bioran or CorSub to any direct or indirect
wholly owned subsidiary of Corning, or merge or liquidate such
company into other wholly owned direct or indirect subsidiaries of
<PAGE>
Corning, provided that no such action on the part of Corning will
cause the transactions contemplated herein not to qualify as a tax-
free reorganization pursuant to the Code. Corning shall not take
any action which would cause the transactions contemplated herein
to fail to qualify as a tax-free reorganization pursuant to the
Code.
4.7 Brokers. Negotiations relative to this Agreement and the
transactions contemplated hereby have been carried on by Corning
without the assistance of any broker or finder and no brokerage or
finders' commission or fee, is payable by any Corning Party to any
other party on account of this Agreement or the transactions
contemplated hereby.
4.8 Disclosure. Except as such representation or warranty may be
qualified herein to the best knowledge of Corning, no
representation or warranty by Corning, nor any written statement or
certificate furnished to the Bioran Group pursuant hereto, contains
any untrue statement of a material fact or omits to state a
material fact necessary to make the statements contained herein and
therein not misleading.
4.9 No Material Adverse Change. Since January 2, 1994, other than
disclosed in Corning's 1994 10-Qs and 8-Ks, there has been no
material adverse change in the assets, business, operations or
financial condition of Corning and its subsidiaries considered as
a whole or any other event, condition or state of facts of any
character peculiar to Corning or any of its subsidiaries or to
their operations which materially and adversely affects, or
threatens to materially and adversely affect, the assets, business,
operations or financial condition of Corning and its subsidiaries
considered as a whole.
ARTICLE V. Certain Agreements
5.1 Investigations and Operations of Business of Bioran. Between
the date of this Agreement and the Closing Date:
(a) Access to Records and Business. Bioran, the Trustee and
S.A. Fennell L.P. shall give Corning and its representatives and
agents full access to the premises and books and records of Bioran
(other than client-specific information and employee-specific
information, the disclosure under Sections 3.9 and 3.13 being
deemed satisfactory but including the real property listed in
Schedule 1.1(a)) and shall cause its officers, employees and
independent auditors if any to furnish Corning such financial and
operations data and other information, including access by Corning
and Price Waterhouse to Bioran"s independent auditors' work papers,
with respect to the business and properties of Bioran as Corning
<PAGE>
shall from time to time request; provided, however, that any such
investigation (i) shall be conducted upon reasonable prior notice
at mutually agreed times and otherwise in such manner as not to
interfere unreasonably with the operation of the business of Bioran
and (ii) shall not affect any of the representations and warranties
hereunder. In the event the Merger is not consummated, Corning
will return and will cause its representatives to return, all
documents, work papers and other material obtained from Bioran and
S.A. Fennell L.P. in connection with the transactions contemplated
hereby and will hold such material and business information derived
therefrom confidential unless and until such material or the
information contained therein becomes part of the public domain or
is obtained from other sources who are entitled to disclose such
material or information.
(b) Preservation of Business. Bioran and the Existing
Shareholders will use their best efforts to preserve intact the
business organization of Bioran to keep available the services of
the present officers and employees of Bioran and to preserve its
present relationships with persons having significant business
relations with it.
(c) Operations in the Ordinary Course. Except as expressly
provided otherwise herein, Bioran shall operate its business only
in the ordinary course and, by way of amplification and not
limitation, Trustee and Bioran, as the case may be, shall not,
except as expressly provided otherwise herein, without the prior
written consent of an officer of Corning which shall not be
unreasonably withheld (which consent shall be given or withheld, as
the case may be, within 72 hours of Corning's receipt of Bioran"s
written request therefor, with any failure to so give or withhold
consent being deemed consent):
(i) issue or commit to issue any Bioran Trust Stock or
other ownership interest in itself, or grant or
commit to grant any options, warrants, convertible
securities or other rights to subscribe for,
purchase or otherwise acquire any shares of Bioran
Trust Stock or other ownership interest, nor change
in any manner the partnership interests in S.A.
Fennell L.P. or agree to do so,
(ii) change Bioran"s method of accounting or any
accounting practices or policies, or any practice
or policy regarding its assets, accounts receivable
or payable, or debt financing,
(iii) declare, set aside, or pay any dividend or
distribution with respect to the Bioran Trust Stock
<PAGE>
or other ownership interest of it other than
distributions that will not result in Bioran"s not
complying with the condition set forth in Section
6.1(m) below,
(iv) directly or indirectly (other than pursuant to and
in accordance with the terms of plans or agreements
listed on the Schedules hereto) redeem, purchase or
to otherwise acquire or commit to acquire any
Bioran Trust Stock or any other ownership interest
of Bioran,
(v) effect a split or reclassification of the Bioran
Trust Stock or a recapitalization of Bioran,
(vi) change Bioran"s Declaration of Trust or other
governing instruments, if any or amend any
Shareholders Agreement to which any of them is a
party,
(vii) enter into any research and development agreement
or enter into any license agreement,
(viii) enter into any employment, consulting or agency
agreement or commitment with any person or modify
or cancel any such agreement, commitment or
contract in effect on the date hereof containing an
obligation to pay or accrue more than $50,000
annually or totaling $100,000 in the aggregate for
any one such person, provided that the foregoing
restriction shall not apply to hirings by Bioran of
persons to replace employees who have left the
employ of Bioran or where no employment agreement
specifying a minimum term of employment is entered
into with such person,
(ix) enter into any agreement, contract or commitment
relating to capital expenditures containing an
obligation to pay or accrue more than $50,000 or
totaling $100,000 in the aggregate,
(x) enter into any agreement, contract, indenture or
other instrument relating to the borrowing of money
or other contracting for indebtedness or the
guarantee of any obligation for the borrowing of
money or other contracting for indebtedness in
excess of $50,000, or incur additional indebtedness
in excess of $50,000 over that shown on its latest
interim balance sheet delivered to Corning prior to
<PAGE>
the date hereof other than as will not result in
Bioran"s not complying with the condition set forth
in Section 6.1(m) below,
(xi) enter into any lease of real or personal property
having a term of more than one year or continuing
an obligation to pay or accrue more than $25,000 a
year or totaling $100,000 in the aggregate,
excluding renewals of existing leases in the
ordinary course for a period of not longer than one
year,
(xii) enter into any agreement, contract or commitment
relating to the disposition or acquisition of any
interest in any business enterprise,
(xiii) enter into any other agreement, contract or
commitment which is not terminable without penalty
on 60 days" notice or payment by it of an amount
greater than $25,000 or which agreements, contracts
or commitments are not terminable without payment
of an amount greater than $250,000 in the
aggregate,
(xiv) modify or cancel any agreement or policy of
insurance required to be listed in Schedules 3.11
or 3.14, or any agreement for which consent of
Corning has been obtained herein,
(xv) enter into any new line of business, or terminate
any existing line of business, or open, or agree to
open, or close, or announce the closure of, any
facility, or dispose of any material asset or enter
into a settlement of any claim or liability,
asserted by or against Bioran,
(xvi) pay or agree to pay any remuneration by way of
bonus, severance or otherwise, to Trustee, or any
of Bioran"s officers, directors, consultants or
employees, or adjust the compensation of any such
person except pursuant to existing merit pay
adjustment program (expected to occur effective
with the October, 1994 payroll),
<PAGE>
(xvii) adopt or amend any Benefit Plan, except as required
by law or as contemplated in this Agreement, or
(xviii) settle or dispose of any claims by or against
Bioran for an amount greater than $25,000
individually or $250,000 in the aggregate.
5.2 Notifications of Breach. Corning and the Bioran Group, as
the case may be, shall promptly notify the other of any action or
inaction by either of them or any other person which shall render
inaccurate in any material respect any of the respective
representations and warranties contained herein.
5.3 Third Party Consents. Corning and the Bioran Group shall
use their respective best efforts to obtain the consent or
approval of each third party whose consent or approval is required
for the consummation by it of the transactions contemplated
hereby.
5.4 Maintenance of Assets. Bioran shall cause the assets and
properties used by it in the conduct of its business (i) to be
maintained in usable operating condition, damage by casualty and
ordinary wear and tear excepted, and (ii) to be used in the
ordinary course of business consistent with past practice.
5.5 Listing of Corning Common Stock. Corning shall use its best
efforts to obtain, prior to the Closing, approval for the listing
on the New York Stock Exchange, Inc., subject to official notice
of issuance, of the shares of Corning Common Stock issued and to
be issued pursuant to this Agreement.
5.6 Adjustments of Corning Common Stock. If Corning shall effect
a split, consolidation, reclassification of Corning Common Stock
outstanding or make any other distribution of Corning Common Stock
or of any security convertible into Corning Common Stock to the
holders of Corning Common Stock, generally, after the date hereof
and on or before the Closing Date, the Bioran Shareholders shall
have the right to receive hereunder at Closing such number of
shares of Corning Common Stock as they would have been entitled to
receive upon such split, consolidation, reclassification or
distribution had the Closing been held immediately prior to such
split, consolidation, reclassification or distribution.
5.7 Cooperation; Satisfaction of Conditions. Corning and the
Bioran Group shall (a) give assistance, to the extent within their
respective control, to each other in the preparation of required
filings, including without limitation, the Premerger Notification
Report pursuant to the H-S-R Act, and the seeking of required
consents in any manner reasonably requested and (b) use their
respective best efforts to pursue, to the extent within its
control, the satisfaction of all other conditions to the
consummation of the Exchange and the Merger.
<PAGE>
5.8 Updated Schedules. No later than fifteen (15) days after
the date hereof, Bioran shall deliver to Corning an updated
Schedule 3.15 which shall, in addition to the matters set forth in
Section 3.15, include all Permits held by Bioran as of the date
hereof. No later than 15 days after the date hereof, Bioran shall
deliver to Corning, Schedule 3.16 which will accurately set forth,
for each test or analysis performed or offered by Bioran, a
summary of all proficiency testing performed by Bioran on each
such test or analysis and the results thereof for each of the four
most recent quarters for which proficiency testing was performed
on such test or analysis, including without limitation proficiency
testing under state, federal or privately operated programs.
Schedule 3.16 shall also list by name of inspecting body, scope of
inspection, date of inspection and result of inspection all
inspection reports of Bioran in the possession of Bioran by all
governmental authorities and private accreditation agencies having
jurisdiction over its business issued since January 1, 1991. The
Bioran Group shall be deemed to represent and warrant to Corning
the information included in amended Schedule 3.15 and in Schedule
3.16 on the same basis as if such Schedules had been included in
Article III.
ARTICLE VI. Conditions of the Exchange
6.1 Conditions of Obligations of Corning. The obligations of
Corning to consummate the Exchange shall be subject to the
following conditions:
(a) Representations and Warranties of the Bioran Group to be
True; Performance by the Bioran Group. The representations and
warranties of the Bioran Group herein contained shall be true and
correct in all material respects at the Closing Date with the same
effect as though made at such time, except insofar as such
representations and warranties are given as of a particular date
or to the extent waived hereunder or affected by the transactions
contemplated or permitted herein; the Bioran Group and its
members, respectively, shall have performed in all material
respects all obligations and complied in all material respects
with all covenants and conditions required by this Agreement to be
performed or complied with by it at or prior to the Closing Date;
and the Trustee shall have delivered to Corning a certificate in
form and substance satisfactory to Corning, dated the Closing Date
to the knowledge of such individual after due inquiry, to all such
effects, and if required to make such Schedules accurate as of the
Closing Date, amended Schedules dated as of the Closing Date,
initialed by such individual.
<PAGE>
(b) Escrow Agreement. The members of the Bioran Group as
required and the Escrow Agent named therein shall have executed
and delivered to Corning the Escrow Agreement.
(c) Registration Rights Agreement Regarding Corning Common
Stock. The members of the Bioran Group as required shall have
executed and delivered to Corning the Registration Rights
Agreement.
(d) Non-Competition Agreement. J. Richard Fennell and
Kathleen M. Fennell shall have executed and delivered to Corning
the Non-Competition Agreement (in the form of Exhibit F attached
hereto).
(e) No Legal Proceedings. No injunction shall have been
obtained, and no suit, action or other proceeding shall be
threatened or pending before any court or governmental agency in
which it is sought to restrain or prohibit the consummation of the
transactions contemplated hereby or involving a claim that the
consummation of the transactions contemplated hereby would result
in a violation of any law, decree or regulation of any
governmental agency thereof having jurisdiction.
(f) Statutory Requirements. All statutory requirements for
the valid consummation by Bioran, S.A. Fennell L.P. and Corning of
the transactions contemplated by this Agreement shall have been
fulfilled, including without limitation expiration of the waiting
period under the H-S-R Act; all authorizations, consents and
approvals of all federal, state and local governmental agencies
and authorities, required to be obtained in order to permit
consummation by Bioran, S.A. Fennell L.P. and Corning of the
transactions contemplated by this Agreement and to permit the
businesses presently carried on by Bioran and S.A. Fennell L.P. to
continue substantially unimpaired immediately following the
Closing Date, shall have been obtained and shall be in full force
and effect.
(g) Opinion of Counsel for the Bioran Group. Corning shall
have received from Messrs. Lourie and Cutler, P.C., counsel for
the Bioran Group, an opinion, dated the Closing Date, in form and
substance satisfactory to Corning's counsel, covering the matters
set forth below:
(i) Bioran is a business trust duly organized and
validly existing under the laws of the Commonwealth
of Massachusetts and has the requisite power and
authority under such laws to conduct its business
as presently conducted;
<PAGE>
(ii) Bioran is duly qualified and licensed as a business
entity in good standing in all jurisdictions where
the operations of Bioran require that it be
qualified or licensed and where the failure to so
qualify would have a material adverse effect on the
assets, business, operations or financial condition
of Bioran;
(iii) based upon such counsel's examination of the
Declaration of Trust, Bioran"s Stock Registers and
Shareholder Agreements, the authorized and
outstanding capital stock of Bioran is as stated on
Schedule 3.1 to this Agreement and, to the best of
such counsel's knowledge after due inquiry, all
issued shares of Bioran Trust Stock have been duly
authorized, are validly issued and outstanding and
fully paid and nonassessable and there are no
shares issued in violation of any preemptive rights
in respect thereof under applicable law;
(iv) S.A. Fennell L.P. is a duly organized limited
partnership existing in accordance with the laws of
the Commonwealth of Massachusetts;
<PAGE>
(v) this Agreement, the Escrow Agreement, the
Registration Rights Agreement, the Real Estate
Option Agreement, the Affiliate"s Agreement and the
Non-Competition Agreement each has been duly
executed and delivered by each member of the Bioran
Group or the Affiliates, as required, and each is
the valid and binding obligation of such Bioran
Group members thereto except that the
enforceability of this Agreement, the Escrow
Agreement, the Registration Rights Agreement, the
Real Estate Option Agreement, the Affiliate"s
Agreement and the Non-Competition Agreement is
subject to the laws of bankruptcy and laws of
general applicability relating to or affecting
enforcement of creditors' rights, and to judicial
discretion in the application of principles of
equity;
(vi) neither the execution and delivery by any member of
the Bioran Group of this Agreement, the Escrow
Agreement, the Registration Rights Agreement or the
Non-Competition Agreement, nor compliance by the
Bioran Group or the Affiliates, with the terms and
conditions of any thereof, nor the consummation of
the Merger will conflict with or result in a breach
of any of the terms, conditions or provisions of
the Declaration of Trust or other governing
instrument of Bioran or of any agreement, contract
or commitment listed on any Schedule, or of any
judgment, order, injunction, decree, regulation or
ruling, of which such counsel is aware, of any
domestic court or domestic governmental authority
to which Bioran is subject, or constitute a
material default thereunder;
(vii) to the best of such counsel's knowledge, all
filings with and authorizations, consents and
approvals of all governmental agencies and
authorities of the United States and of the
Commonwealth of Massachusetts required in order to
permit consummation of the transactions
contemplated by Articles I and II as contemplated
by this Agreement have been made or obtained other
than the filing of the Articles of Merger
contemplated by Article II;
(viii) upon the filing of the Articles of Merger with the
Office of the Secretary of State of the
Commonwealth of Massachusetts, the Merger will be
effective under Massachusetts law;
(ix) J. Richard Fennell has resigned as Trustee of
Bioran and a person nominated by Corning has been
appointed as trustee of Bioran in accordance with
the terms of the Declaration of Trust and the laws
of the Commonwealth of Massachusetts; and
(x) to the best of such counsel's knowledge, except as
disclosed on Schedule 3.17 Bioran is not engaged in
any suit or action, or any other legal,
administrative or arbitration proceeding or
governmental investigation which would, if
adversely determined, materially and adversely
affect or impair its assets, operations, business
or condition, financial or otherwise.
In rendering such opinion such counsel may rely, to the extent
such counsel deems such reliance necessary or appropriate, upon
opinions of local counsel, reasonably satisfactory to Corning as
to matters of law and, as to matters of fact, upon certificates of
public officials and of any officer or officers of Bioran and S.A.
Fennell L.P. provided the extent of such reliance is specified in
such opinion.
<PAGE>
(h) Employment Agreements. Employment agreements between
Bioran and each of the persons listed on Schedule 6.1(h)
satisfactory to Corning shall have been entered into and remain in
full force and effect.
(i) Real Estate Transfer and Leases; Real Estate Option
Agreement. Bioran and S.A. Fennell L.P. shall have executed the
Real Estate Option Agreement. Bioran shall have executed and
delivered to Corning lease agreements satisfactory to Corning as
set forth in Exhibit G and Bioran shall have delivered to Corning
lease agreements for all other properties listed in Item 3 of
Schedule 3.18.
(j) Affiliate Agreements. Each of the Affiliate
Agreements in the form of Exhibit E ("Affiliate Agreements")
entered into by the Bioran Affiliates as of the date hereof shall
be in full force and effect as of the Closing Date and no such
Affiliate shall then be in breach of her Affiliate Agreement.
(k) Insurance. Bioran shall have in full force and
effect those policies of insurance listed on Schedule 3.14.
Corning shall have received an endorsement to its insurance
policies covering professional liability claims of Bioran prior to
the Closing Date that are unknown as of the Closing Date and
Bioran shall have paid prior to the Closing Date 50 percent of the
premium for such endorsement subject to a maximum payment by
Bioran of $75,000.
(l) Price Waterhouse Pooling Letter. Corning shall
have received a letter from Price Waterhouse that the transactions
contemplated herein may be accounted for by Corning as a pooling
of interests, provided that, prior to the issuance of the pooling
letter, the Bioran Group shall deliver to Corning and Price
Waterhouse a letter signed by the Trustee, as representative for
the Bioran Group, stating that, to the best of his knowledge and
belief, after diligent inquiry and investigation and consultation
with Bioran's attorneys and accountants, there are no reasons why
the transactions contemplated herein may not be accounted for as
a pooling of interest.
(m) Bioran Stockholder Equity. As of the Closing on
the Closing Date, Bioran shall deliver a balance sheet ("Closing
Balance Sheet") certified by its Trustee and chief accounting
officer which shows that Bioran"s net Stockholder Equity as of the
Closing Date (determined in accordance with generally accepted
accounting principles applied on a basis consistent with the
principles utilized in the 1994 Financial Statements except that
the Closing Balance Sheet shall be prepared on an accrual (rather
than cash) basis shall be no less than $13,500,000 (excluding the
real estate listed in Schedules 1.1(a)).
<PAGE>
(n) Certificates for Bioran Trust Stock. Corning shall
have received all stock transfer records of Bioran and
certificates representing all shares of Bioran Trust Stock issued
and outstanding as of the Closing Date together with such evidence
satisfactory to Corning that title to such certificates have been
transferred to Corning free and clear of all liens.
(o) Termination of Shareholder Agreement; Release. All
of the Shareholder Agreements shall have been terminated. All
members of the Bioran Group (other than Bioran) and all Bioran
Affiliates shall have executed and delivered to Corning a release
of Bioran from any obligations it may have to such members other
than as contemplated by this Agreement and the Exhibits hereto.
(p) Non-Foreign Status. All Bioran Stockholders shall
have executed and delivered to Corning an affidavit in accordance
with Section 1445 and 897 of the Internal Revenue Code certifying
that none of such persons is a foreign person.
(q) Environmental Investigation. Corning shall be
satisfied in all material respects with its environmental
investigation of the premises and practices of Bioran.
(r) New Schedules. Corning shall be satisfied in all
material respects with Schedules 3.15 and 3.16 and Corning and
Trustee shall have agreed to the contents of Schedule 8.4.
(s) Resignation of Trustee. J. Richard Fennell shall have
resigned as Trustee of Bioran and a person nominated by Corning
shall have been appointed the Trustee of the Trust in accordance
with the terms of the Declaration of Trust and applicable law.
(t) Resignation of Officers. The existing officers of
Bioran shall have resigned and the persons designated by Corning
shall have been elected as officers of Bioran.
6.2 Conditions of Obligations of the Bioran Group. The
obligations of the Bioran Group to cause Bioran to consummate the
Exchange shall be subject to the following conditions:
(a) Representations and Warranties of Corning to be
True; Performance by Corning. The representations and warranties
of Corning herein contained shall be true and correct in all
material respects at the Closing Date with the same effect as
though made at such time, except insofar as such representations
<PAGE>
and warranties are given as of a particular date or except to the
extent waived hereunder or affected by the transactions
contemplated or permitted herein; Corning shall have performed in
all material respects all obligations and complied in all material
respects with all covenants and conditions required by this
Agreement to be performed or complied with by them at or prior to
the Closing Date; and Corning shall have delivered to the Trustee
a certificate of Corning in form and substance satisfactory to
Bioran, dated the Closing Date and signed by its President or one
of its Vice Presidents to the knowledge of such officer after due
inquiry, to all such effects.
(b) Listing of Corning Common Stock. The New York
Stock Exchange, Inc. shall have approved for listing, subject to
official notice of issuance, the shares of Corning Common Stock to
be issued pursuant to the Exchange.
(c) Escrow Agreement; Stock Certificates. Corning and
the Escrow Agent named therein shall have executed and delivered
to the Bioran Group the Escrow Agreement, and Corning shall have
delivered to the Escrow Agent a certificate or certificates
representing the number of shares of Corning Common Stock to be
delivered into the Escrow Fund together with duly executed stock
powers for deposit into the Escrow Fund as provided in the Escrow
Agreement. Corning shall have delivered to the Bioran
Shareholders a certificate or certificates representing the number
of shares of Corning Common Stock to be delivered directly to the
holders of Bioran Trust Stock as contemplated by Section 1.2(c).
(d) Registration Rights Agreement Regarding Corning
Common Stock. Corning shall have executed and delivered to the
Bioran Shareholders the Registration Rights Agreement.
(e) No Legal Proceedings. No injunction shall have
been obtained, or no suit, action or other proceedings shall be
threatened or pending before any court or governmental agency in
which it is sought to restrain or prohibit the consummation of the
transactions contemplated hereby, or in which it is sought to
obtain damages in connection therewith, or involving a claim that
the consummation of the transactions contemplated hereby would
result in a violation of any law, decree or regulation of any
government or agency thereof having jurisdiction.
(f) Statutory Requirements. All statutory requirements
for the valid consummation by Bioran, S.A. Fennell L.P. and
Corning of the transactions contemplated by this Agreement shall
have been fulfilled, including without limitation expiration of
the waiting period under the H-S-R Act; all authorizations,
consents and approvals of all federal, state and local
governmental agencies and authorities required to be obtained in
<PAGE>
order to permit consummation by Bioran, S.A. Fennell L.P. and
Corning of the transactions contemplated by this Agreement shall
have been obtained and shall be in full force and effect.
(g) Tax Opinion of Price Waterhouse. Corning and
Bioran shall have received from Price Waterhouse an opinion, dated
the Closing Date, in form and substance satisfactory to Bioran"s
and Corning's counsel, to the effect that the Exchange and the
transactions contemplated herein qualify as a tax-free
reorganization under Section 368(a) of the Code.
(h) Opinion of Counsel for Corning. The Bioran Group
shall have received from William C. Ughetta, Esq., General Counsel
of Corning, an opinion, dated the Closing Date, in form and
substance satisfactory to the Bioran Group's counsel, covering the
matters set forth below:
(i) Corning is a corporation duly organized and validly
existing and in good standing under the laws of the
State of New York and has the corporate power under
such laws to carry on its business as presently
conducted;
(ii) the authorized capital of Corning consists of
10,000,000 shares of Series Preferred Stock, par
value $100 each, and 500,000,000 shares of Corning
Common Stock;
(iii) all issued shares of Corning Common Stock have been
duly authorized, are validly issued and outstanding
(other than shares held in Corning's Treasury), and
are fully paid and nonassessable;
(iv) the shares of Corning Common Stock issued and to be
issued pursuant to this Agreement have been duly
authorized and, when initially issued in accordance
with this Agreement as at the Closing Date, will be
duly and validly issued and will be fully paid and
nonassessable and subject only to official notice of
issuance, have been accepted for listing on the New
York Stock Exchange, Inc.;
(v) all corporate action by Corning required to
authorize the Exchange has been taken and each of
this Agreement, the Escrow Agreement and the
Registration Rights Agreement has been duly executed
and delivered by Corning as required; each is the
valid and binding obligation of Corning, enforceable
in accordance with their respective terms, except
<PAGE>
that the enforceability of this Agreement, the
Escrow Agreement and the Registration Rights
Agreement is subject to the laws of bankruptcy and
laws of general applicability relating to or
affecting enforcement of creditors' rights, and to
judicial discretion in the application of principles
of equity;
(vi) neither the execution and delivery by Corning of
this Agreement, the Escrow Agreement, or the
Registration Rights Agreement nor compliance by
Corning with the terms and provisions of any of such
agreements to which it is a party, will conflict
with or result in a breach of any of the terms,
conditions or provisions of the Certificate of
Incorporation or By-Laws of Corning or of any
judgment, order, injunction, decree, regulation or
ruling of which such counsel is aware, of any
domestic court or domestic governmental authority to
which Corning is subject, or constitute a material
default thereunder or any other agreement or
instrument by which Corning is bound;
(vii) to the best of such counsel's knowledge, all filings
with and all authorizations, consents and approvals
of all governmental agencies and authorities of the
United States required in order to permit
consummation by Corning of the Exchange as
contemplated by this Agreement have been made or
obtained; and
(viii) to the best of such counsel's knowledge, except as
disclosed in the Corning 1993 10-K, 1994 10-Qs and
1994 8-Ks, Corning is not engaged in any suit or
action, or any other legal, administrative or
arbitration proceeding or governmental investigation
which would, if adversely determined, materially and
adversely affect or impair its assets, operations,
business or condition, financial or otherwise.
In rendering such opinion such counsel may rely, to the extent
such counsel deems such reliance necessary or appropriate, upon
opinions of local counsel reasonably satisfactory to the Bioran
Group as to matters of law and, as to matters of fact, upon
certificates of public officials and of any officer or officers of
Corning and CorSub, provided the extent of such reliance is
specified in the opinion.
<PAGE>
(i) Real Estate Option Agreement. S.A. Fennell and
Bioran shall have executed and delivered the Real Estate Option
Agreement.
(j) New Schedules. Corning and Trustee shall have agreed to
the contents of Schedule 8.4.
ARTICLE VII. Termination of Obligations and Waivers of
Conditions; Payment of Expenses
7.1 Termination of Agreement and Abandonment of Merger.
Anything herein to the contrary notwithstanding, this Agreement and
the Exchange contemplated hereby may be terminated as follows, and
in no other manner:
(a) Mutual Consent. At any time before the Closing Date
by mutual written consent of Corning and the Trustee (on behalf of
itself and the Bioran Group), or
(b) Expiration Date. By either Corning or the Trustee
on written notice if the Exchange shall not have closed by December
31, 1994 (which date may be extended by mutual agreement of Corning
and the Trustee).
7.2 Effect of Termination. In the event that this Agreement
shall be terminated pursuant to Section 7.1, all obligations of the
parties hereto under this Agreement shall terminate (except those
of confidentiality under Section 5.1(a), which shall survive such
termination) and there shall be no liability of any party to
another (except by reason of a default hereunder which has not been
waived).
7.3 Payment of Expenses. Corning and the Bioran Group,
respectively, will pay all of its own costs and expenses incident
to their respective negotiation and preparation of this Agreement
and to their performance of and compliance with all agreements and
conditions contained herein or therein on their part to be
performed or complied with, including the fees, expenses and
disbursements of counsel and auditors. Any expenses of Bioran will
be reflected in the closing balance sheet referred to in Section
8.5(c).
7.4 Waiver of Conditions.
(a) If any of the conditions specified in Section 6.1 has not
been satisfied, Corning may nevertheless at its election proceed
with the transactions contemplated hereby. Any such election to
proceed shall be evidenced by a certificate of Corning executed by
its Vice Chairman, President or one of its Vice Presidents.
<PAGE>
(b) If any of the conditions specified in Section 6.2 has not
been satisfied, the Bioran Group may nevertheless at its election
proceed with the transactions contemplated hereby. Any such
election to proceed shall be evidenced by a certificate of the
Trustee (on behalf of himself and the other members of the Bioran
Group).
ARTICLE VIII. Miscellaneous
8.1 Amendments. This Agreement and any Exhibit attached hereto
may be amended at any time by an instrument in writing signed
respectively by an authorized officer of, or individually by, each
of the parties hereto, making reference to this Agreement and
expressing the plan or intention to amend or modify it.
8.2 Schedules. Each Schedule delivered by Bioran pursuant to the
terms of this Agreement is in writing and has been initialed by the
Trustee on its behalf.
8.3 Further Instruments and Actions. Each party shall execute
and deliver such instruments and take such other action as shall be
reasonably required, or as shall be reasonably requested by any
other party, in order to carry out all transactions, agreements and
covenants contemplated in this Agreement, at or prior to the
Closing Date.
8.4 Survival of Representations and Warranties. The respective
representations and warranties of Corning and (other than specific
items of potential loss identified by Corning in a schedule
("Schedule 8.4") to which the Bioran Group shall have agreed to the
Closing prior to the Closing Date) the Bioran Group contained
herein and in any instrument delivered by them hereunder shall
expire and be terminated and extinguished 24 months after the
Closing Date.
8.5 Indemnification.
(a) Indemnification by Bioran Shareholders. Subject to
Section 8.4 above (in the case of clause (i) below), the terms of
the Escrow Agreement and the limitations set forth below, the
Trustee and Bioran Shareholders (except S. A. Fennell, L.P., which
shall be responsible only for Losses attributable to S. A. Fennell,
L. P.) shall jointly and severally indemnify Corning against
losses (including any and all costs, expenses, liabilities,
judgments, assessments or penalties and reasonable attorneys' fees
and disbursements relating thereto but less any tax savings (based
on an assumed combined federal and state tax rate of 40%) arising
out of the deductibility of such losses or expenses, or otherwise,
<PAGE>
which are hereinafter referred to as "Losses") suffered or incurred
by Corning resulting from or arising out of (i) the substantial
inaccuracy of any representations, or material breach of any
warranties or covenants of the Bioran Group, contained in this
Agreement or of any Exhibit, Schedule or Certificate delivered to
Corning pursuant to this Agreement, (ii) the claims listed on
Schedule 3.17 and any professional liability claims against Bioran
not covered and reimbursed by insurance, which claim arose out of
operations of Bioran prior to the Closing and which (A) are brought
within two years after the Closing Date or (B) are known to any
member of the Bioran Group prior to the Closing Date, provided that
if Corning shall not maintain professional liability insurance
coverage in the same policy amounts (including retentions) as
heretofore maintained by Corning, then the Trustee"s and Bioran
Shareholders' liability hereunder to Corning for Losses incurred on
account of such claims shall be limited to those Losses that would
have been incurred had such insurance been maintained, and provided
further that neither the Trustee nor the Bioran Shareholders shall
be liable to Corning for any Loss caused by an error or omission of
Corning, (iii) any federal, state or local income, sales or other
taxes of Bioran for periods ending on or prior to the Closing Date,
(iv) any claim for finder's fee or brokerage or other commission
arising by reason of any services alleged to have been rendered to
or at the instance of any member of the Bioran Group with respect
to this Agreement or any of the transactions contemplated hereby
and (v) any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs and expenses, including without
limitation, reasonable legal fees and expenses, incident to any of
the foregoing or incurred in attempting to oppose the imposition
thereof, or in enforcing this indemnity. Corning's recovery of its
losses pursuant to this clause shall be limited to the aggregate
value of the shares of Corning Common Stock issued to Bioran
Shareholders. Corning shall not be entitled to indemnification on
account of any Losses (other than adjustments on account of the
Closing Balance Sheet which are covered in (c), below) unless the
aggregate of Losses shall exceed $600,000 (the "Threshold Amount"),
but Corning shall be entitled to recover all Losses if Losses
exceed the Threshold Amount in the aggregate, provided that each
separate claim asserted by Corning as comprising such aggregate
shall be for at least $10,000. The Bioran Group recognizes that
Corning Life Sciences Inc. ("CLSI") and its subsidiaries are self-
insured for the first $1 million per claim of professional
liability claims, subject to an aggregate stop loss limit of $3
million per year. Corning agrees that all self-insured retentions
shall first be applied to all professional liability claims of CLSI
and it subsidiaries other than professional labilities claims of
Bioran occurring prior to the Closing Date so that such claims of
Bioran that are covered by insurance shall be deemed reimbursed by
insurance to the extent that the stop loss limit of CLSI is
<PAGE>
exceeded. The Bioran Group further understands that the policy
referred to in Section 6.1(j) will not cover Corning for
professional liability claims known as of the Closing Date.
(b) Indemnification by Corning. Subject to Section 8.4 above
(in the case of clause (i) below), Corning shall indemnify the
Bioran Shareholders against losses (including any and all costs,
expenses, liabilities, judgments, assessments or penalties and all
reasonable attorneys' fees and disbursements relating thereto)
suffered or incurred by the Bioran Shareholders resulting from or
arising out of the (i) substantial inaccuracy or material breach of
any representations, warranties or covenants of Corning in this
Agreement or of any Schedule or Certificate delivered to Bioran
pursuant to this Agreement, (ii) any claim for finder's fee or
brokerage or other commission arising by reason of any services
alleged to have been rendered to or at the instance of Corning with
respect to this Agreement or any of the transactions contemplated
hereby and (iii) any and all actions, suits, proceedings, claims,
demands, assessments, judgments, costs and expenses, including
without limitation, reasonable legal fees and expenses, incident to
any of the foregoing or incurred in attempting to oppose the
imposition thereof, or in enforcing this indemnity. Any indemnity
paid by Corning in Corning Common Stock shall be valued at $31 per
share.
(c) Closing Balance Sheet Adjustment. Within 60 days after
the Closing Date, Corning shall deliver a written notice to the
Trustee either accepting the Closing Balance Sheet as presented or
objecting to the Closing Balance Sheet and proposing specific
adjustments thereto with the reasons therefor. If the aggregate of
adjustments so proposed exceeds $50,000 in favor of Corning and the
Trustee does not agree to such adjustments within 30 days of
Corning"s notice, Corning shall issue a Claim Certificate to the
Escrow Agreement under the Escrow Agreement, and the claim for
adjustment shall be handled in accordance with (d) below and the
provisions of the Escrow Agreement. Any claim for adjustment to
the Closing Balance Sheet less than $50,000 shall be waived by
Corning, and any amount finally determined as owing to Corning on
account of such a claim for adjustment shall be reduced by $50,000.
(d) Arbitration. All disputes arising under Section 8.5(a),
8.5(b) and 8.5(c) between the parties which are not resolved by
means of direct negotiations between them shall be finally settled
by arbitration in accordance with this Section 8.5(d). The
arbitration shall be held in or around Boston, Massachusetts and
shall be conducted in accordance with the commercial arbitration
rules of the American Arbitration Association (AAA) by one
arbitrator, appointed by consent of Corning and the Trustee which
consent shall not be unreasonably withheld or delayed. If the
<PAGE>
parties cannot agree upon an arbitrator, either may apply to the
AAA to appoint one. The arbitrator shall resolve the dispute
within 60 days after the dispute is submitted to him. Any
decision by the arbitrator shall be binding upon the parties and
may be entered as a final judgment in any court having
jurisdiction. The cost of any arbitration proceeding shall be
borne by the parties as the arbitrator shall determine if the
parties have not otherwise agreed. The arbitrator shall render his
final decision in writing to the parties, which decision shall
explain the reasons therefor.
(e) Third Party Claims. If any claim is made or an action is
brought against Corning for which indemnification from the Trustee
and Bioran Shareholders is available to Corning under this
Agreement, Corning shall notify the Trustee promptly in writing
upon the receipt of notice of such claim or summons, as the case
may be, and the Trustee and Bioran Shareholders may at their option
thereafter assume the defense thereof with counsel reasonably
acceptable to Corning which fees and expenses of defense shall be
charged to and paid out of the Escrow Fund, provided that Corning
may continue to participate in (but not control) the defense and
disposition of such claim or action at its expense. Corning shall
cooperate with the Trustee and Bioran Shareholders in the defense
of such claim or action, and no settlement of such claim or action
which does not involve a total release of Corning and its
Subsidiaries from such claim or action shall be made by the Trustee
or Bioran Shareholders without Corning's approval, which shall not
be unreasonably withheld.
8.6 Publicity. Corning and the Bioran Group agree that all press
releases, announcements and other publicity concerning this
Agreement shall be subject to the prior approval by both of them,
with Corning acting through the Executive Vice President-Finance of
CLSI and the Bioran Group acting through the Trustee.
8.7 Governing Law. This Agreement and the legal relations
between the parties shall be governed by and construed in
accordance with the laws of the State of New York.
8.8 Notices. Any notices or other communications required or
permitted thereunder shall be sufficiently given if hand delivered
or sent by registered mail or certified mail, postage prepaid, or
by overnight courier or delivery service addressed, if to Corning,
care of Corning Life Sciences Inc., One Malcolm Avenue, Teterboro,
New Jersey 07608, Attention: Raymond C. Marier, General Counsel,
and if to the Bioran Group, care of J. Richard Fennell, Ph.D., Two
Laxfield Road, Weston, MA 02193, copy to Lourie & Cutler, P.C., 60
State Street, Boston, MA 02109, Attention: David R. Andelman,
Esq., or such other address as shall be furnished in writing by any
<PAGE>
of the parties, and any such notice or communication shall be
deemed to have been given as of the date so mailed (except that a
notice of change of address shall not be deemed to have been given
until received by the addressee).
8.9 No Assignment. This Agreement may not be assigned, by
operation of law or otherwise, and any attempt to do so shall be
null and void.
8.10 Headings. The descriptive headings of the several Articles,
Sections and paragraphs of this Agreement are inserted for
convenience only and do not constitute part of this Agreement.
8.11 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 hereto and delivered to
each of the other parties hereto.
8.12 Entire Agreement. Other than the Confidentiality Agreement
dated June 22, 1994 and the amendment letter thereto executed in
August 1994, this Agreement and the Exhibits and Schedules
identified herein represent the entire agreement and understanding
between the parties hereto with respect to the subject matter
hereof and as such supersedes all prior representations,
negotiations, understandings, and agreements.
8.13 Additional Actions. The Trustee and S.A. Fennell L.P.
shall, at any time and from time to time after the Closing, without
further consideration, execute whatever minutes of meetings or
other instruments and take whatever action as Corning or CorSub may
deem reasonably necessary or desirable to effect, perfect or
confirm of record or otherwise in CorSub full right, title and
interest in and to the assets of Bioran or to carry out the intent
and purposes of the transactions contemplated hereby.
<PAGE>
IN WITNESS WHEREOF, each of the parties hereto have caused this
Agreement to be executed on its behalf by its officers thereunto
duly authorized, all as of the day and year first above written.
CORNING INCORPORATED
By: ___________________________________
Van C. Campbell
Vice Chairman
MORAN RESEARCH LABS
By:____________________________________
J. Richard Fennell, Ph.D.,
Trustee and President
S.A. FENNELL LIMITED PARTNERSHIP
By: ___________________________________
Its General Partner, Forest Realty
Company, a Massachusetts Business
Trust, acting through its Trustee,
J. Richard Fennell
SUSAN E. KHOURY IRREVOCABLE TRUST
LINDA M. SHEA IRREVOCABLE TRUST
KATHLEEN M. FENNELL IRREVOCABLE TRUST
PATRICIA A. McEACHERN IRREVOCABLE TRUST
By: ___________________________________
Ann Marie Cannistraro, Trustee
By: ___________________________________
Shirley A. Fennell, Trustee
By:____________________________________
Susan E. Khoury, Trustee and Settlor
By:____________________________________
Linda M. Shea, Trustee and Settlor
By:_____________________________________
Kathleen M. Fennell, Trustee and
Settlor
By:_____________________________________
Patricia A. McEachern, Trustee and
Settlor
<PAGE>
D:\FILINGS\CORNING\81364\BIO-ACQ.AG1
INDEX OF SCHEDULES
Item Description
1.1(a) Real Property Conveyed by S.A.
Fennell L.P.
3.1(c) Share Ownership
3.4 Conflicts
3.5(a) Financial Statements
3.7 Tangible Assets
3.8 Business
3.9 Client List
3.10 Computer Programs
3.11 Contracts
3.12 Intellectual Property
3.13 Employee Listing and Employee
Benefits
3.14 Insurance Policies
3.15 Permits
3.16 Proficiency Testing
3.17 Litigation
3.18 Real Property
3.21 Affiliate
3.22 Bank Accounts
3.24 Adverse Change
6.1(h) Employment Agreements
8.4 Potential Losses
<PAGE>
INDEX OF EXHIBITS
A Escrow Agreement
B-1 Agreement of Merger
B-2 Articles of Merger
C Registration Rights Agreement
D Real Estate Option Agreement
E Affiliates' Agreement
F Non-Competition Agreement
G Affiliated Party Real Estate Leases
CORNING
Corning Incorporated
Corporate Communications Division
Corning, New York 14831 USA
607-974-9000
fax 607-974-8551
Kathryn C. Littleton
(607) 974-8206
John H. Abrams
(607) 974-8832
IMMEDIATE RELEASE
OCTOBER 10, 1994
Corning and Bioran Medical Laboratory Complete Merger
Of Clinical Laboratory Testing Operations
CORNING, N.Y., Oct. 10 - Corning Incorporated (NYSE:GLW) said today it has
completed the merger of Bioran Medical Laboratory, a privately owned Cambridge,
Massachusetts, firm specializing in clinical laboratory testing for hospitals
and physicians, with Corning's nationwide network of clinical laboratory
testing operations.
Bioran will operate in Cambridge as Corning Bioran, a unit of Corning Clinical
Laboratories. Dr. J.R. Fennell, Bioran's current president, will oversee
Corning's Boston-based clinical testing operations. Bioran had been owned
and operated by the Fennell family since 1968.
Corning entered the laboratory testing services market in 1982 when it
acquired MetPath Inc. Today, Corning is a leader in the $32 billion nation-wide
testing market and operates some 20 major clinical testing facilities in the
United States. Corning additionally provides a comprehensive range of
pharmaceutical testing services through Corning Pharmaceutical Services. For
1993, Corning's combined laboratory services revenues were $1.3 billion.
Corning Incorporated is a Fortune 200 company which competes in four
market segments: specialty materials, communications, laboratory services, and
consumer products. Its 1993 sales totaled $4 billion.
- -30-
Corning Investor Relations Contact: Richard B. Klein, (607) 974-8313.
