SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 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): December 11, 1996
IMMUCOR, INC.
(Exact name of registrant
as specified in its charter)
Georgia 0-14820 22-2408354
(State or other (Commission (I.R.S. Employer
jurisdiction of File Number) Identification No.)
incorporation)
3130 Gateway Drive, P.O. Box 5625, Norcross, Georgia 30091
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (770) 441-2051
N/A
(Former name or former address, if changed since last report.)
Item 2. Acquisition or Disposition of Assets
On December 11, 1996 (the "Closing Date"), pursuant to a Share Purchase
Agreement dated December 11, 1996 (the "Agreement"), Immucor, Inc. ("Immucor"),
through a newly formed Canadian subsidiary ("Immucor/Canada"), acquired all of
the issued and outstanding common stock of Dominion Biologicals Limited
("Dominion") from Nubio Technologies Corporation, Patrick Waddy and Blaine
MacNeil (collectively the "Sellers") for CDN$11,107,000.00 (the "Purchase
Price"). The Purchase Price was determined through arm's length negotiations.
CDN$5,366,000.00 of the Purchase Price was paid in cash on the Closing Date.
The remaining CDN$5,741,000.00 of the Purchase Price was paid in the form of
subordinated promissory notes of Immucor/Canada bearing interest at 6% payable
semiannually with principal due three (3) years after the Closing Date.
Immucor guaranteed the obligations of Immucor/Canada under the subordinated
promissory notes. The subordinated promissory notes and the Immucor
guaranties are subordinated to Immucor's and Immucor/Canada's current bank
financing. The transaction was funded by a loan from Wachovia Bank of
Georgia, N.A., a U.S. commercial bank, to Immucor/Canada.
Located in Dartmouth, Nova Scotia, Canada, Dominion is engaged in the
business of developing, manufacturing and distributing blood bank reagents
and related products for grouping, typing, antibody screening and crossmatching
blood and blood components for transfusion. Immucor will operate Dominion as
a wholly-owned Canadian subsidiary. Dominion's annual sales volume is
approximately US$3,500,000.00 with operating earnings of approximately
US$1,000,000.00.
The Agreement contained two (2) year noncompetition provisions for Messrs.
Waddy and MacNeil. In exchange for a cash payment of CDN$375,000.00, Samuel
Brushett, the sole shareholder of Nubio Technologies Corporation, is subject
to the noncompetition provisions of the Agreement for a period of five (5)
years after the Closing Date. On the Closing Date, Dominion entered into two
(2) year employment agreements with Messrs. Waddy and MacNeil.
In connection with the acquisition, the Sellers were each granted two (2) sets
of warrants to acquire Immucor stock exercisable one (1) year after the
issuance date, with one set expiring in five years and the other set expiring
in ten years. The exercise price for the five-year warrants is US$12.00, and
the aggregate number of shares covered by the five-year warrants is 478,417.
The exercise price for the ten-year warrants is US$11.98, and the aggregate
number of shares covered by the ten-year warrants is 150,000. Immucor has
agreed to register the resale of the shares covered by both sets of warrants
upon Seller's request after the exercise date or in connection with another
registered public offering.
Prior to the Closing Date, none of the Sellers had a material relationship
with Immucor or its affiliates or any director or officer of Immucor or any
associate of any Immucor director or officer.
On December 13, 1996, Immucor/Canada was amalgamated with Dominion, with
Dominion surviving as a wholly-owned direct subsidiary of Immucor.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
(c) Exhibits.
2.1. Share Purchase Agreement dated as of December 11, 1996 relating
to the purchase of Dominion Biologicals Limited by Immucor, Inc.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
IMMUCOR, INC.
By: /s/ Edward L. Gallup
Edward L. Gallup, Chairman of
the Board of Directors, President
and Chief Executive Officer
Dated: December 23, 1996
EXHIBIT INDEX
Page
2.1. Share Purchase Agreement dated as of December 11, 1996,
relating to the purchase of Dominion Biologicals Limited by
Immucor, Inc.
SHARE PURCHASE AGREEMENT
between
3000524 NOVA SCOTIA LIMITED and IMMUCOR, INC.
and
Samuel Brushett,
Nubio Technologies Corporation,
Patrick Waddy, and Blaine MacNeil
and
DOMINION BIOLOGICALS LIMITED
December 11, 1996
TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS 1
ARTICLE II
TERMS OF TRANSACTION 4
2.1 Purchase and Sale of Shares of Dominion 4
2.2 Purchase Price 5
2.3 Payment 5
2.4 Allocation of Payment 5
2.5 Noncompetition Payment 5
2.6 The Closing 6
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
SHAREHOLDERS REGARDING THE SHARES AND SHAREHOLDERS 7
3.1 Power and Authority of Shareholders 7
3.2 Organization and Authority of Nubio 8
3.3 Ownership of the Shares 8
3.4 Issued Shares 8
3.5 Absence of Other Claims 8
3.6 Shareholders Net Worth 9
3.7 Citizenship 9
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
THE SHAREHOLDERS REGARDING DOMINION 9
4.1 Organization and Authority 9
4.2 Compliance With Law 10
4.3 Financial Statements 10
4.4 Indebtedness 10
4.5 No Undisclosed Liabilities 10
4.6 Tax Matters 10
4.7 Products 11
4.8 Litigation 12
4.9 Assets 12
4.10 Bank Accounts 14
4.11 Suppliers and Customers 14
4.12 Trade Secret and Employment Claims 14
4.13 Intellectual Property 15
4.14 Contracts 15
4.15 Leases 16
4.16 Permits and Regulatory Compliance 17
4.17 Labor Matters 17
4.18 Employees 18
4.19 Employee Benefit Plans and Arrangements 19
4.20 Environmental Matters 21
4.21 Insurance Policies 22
4.22 Events After October 31, 1996 22
4.23 Copies Provided to Immucor/Canada 24
4.24 Brokers 24
4.25 Adverse Information 24
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF IMMUCOR/CANADA AND
IMMUCOR/US 25
5.1 Organization, Power and Authority of Immucor/Canada25
5.2 Power and Authority of Immucor/US 25
5.3 Shares Issued Pursuant to Warrants 26
5.4 Maintaining Work Force 26
ARTICLE VI
COVENANTS OF THE PARTIES 26
6.1 Cooperation 26
6.2 Records 26
6.3 Use of Dominion Name 26
6.4 Obligations to Province of Nova Scotia 27
6.5 Expenses 27
6.6 Tax Matters 27
6.7 Survival of Warranties 28
6.8 Indemnification by Shareholders 28
6.9 Indemnification by Immucor/Canada and Immucor/US 30
6.10 Confidentiality 31
6.11 Noncompetition 33
6.12 Funds Received After Closing 33
6.13 Transfer of Shares 34
6.14 Maintaining Work Force 34
ARTICLE VII
MISCELLANEOUS 34
7.1 Notices 34
7.2 Parties Bound by Agreement; Successors and Assigns 35
7.3 Entire Agreement 36
7.4 Descriptive Headings 36
7.5 Counterparts 36
7.6 Amendments and Waivers 36
7.7 Governing Law, Jurisdiction and Venue 36
7.8 No Third-Party Beneficiaries 36
7.9 Gender and Number 36
7.10 Dispute Resolution 36
SHARE PURCHASE AGREEMENT
This Share Purchase Agreement (the "Agreement"), dated as of December 11,
1996 is by and among DOMINION BIOLOGICALS LIMITED ("Dominion"), Samuel
Brushett, Nubio Technologies Corporation, Patrick Waddy and Blaine MacNeil
on the one hand, and 3000524 Nova Scotia Limited, a corporation organized
under the laws of Nova Scotia ("Immucor/Canada"), and Immucor, Inc., a
corporation organized under the laws of Georgia, USA, on the other hand.
Shareholders (as herein defined) desire to sell the Shares (as herein
defined) to Immucor/Canada, and Immucor/Canada desires to buy the Shares
from Shareholders, on all the terms and subject to the conditions contained
herein. Therefore, in consideration of the mutual representations, warranties,
covenants and agreements, and upon and subject to the terms and the conditions
hereinafter set forth in this Agreement, the parties do hereby agree as
follows:
ARTICLE I
DEFINITIONS
For purposes of this Agreement, the following terms shall have the following
meanings:
"Accounting Standards" means GAAP and where not inconsistent with GAAP, the
prior reasonable accounting practices of Dominion as specified in the
Disclosure Memorandum.
"Charter Documents" means the Memorandum of Association and the Articles
of Association of Dominion.
"Closing" means the consummation of the purchase and sale of the Shares under
the terms of this Agreement.
"Closing Date" means the date of this Share Purchase Agreement.
"Dominion" means Dominion Biologicals Limited, a corporation organized under
the laws of Nova Scotia.
"Dominion's Business" means the business of developing, manufacturing and
distributing blood bank reagents and related products for grouping, typing,
antibody screening and crossmatching blood and blood components for
transfusion.
"Dominion Contracts" means all contracts, leases, agreements, indentures,
licenses, mortgages, commitments or binding arrangements or relationships
pursuant to which Dominion is either a party or a third party beneficiary.
"Dominion Premises" means the real estate (including fixtures, buildings and
other improvements thereon) owned, leased or used by Dominion at the addresses
listed in the Disclosure Memorandum.
"Disclosure Memorandum" means the memorandum signed and delivered by the
Shareholders contemporaneously with the execution and delivery of this
Agreement, containing information required to be disclosed under this
Agreement.
"Employees" means the employees of Dominion.
"Encumbrance" means any mortgage, charge (whether fixed or floating), security
interest, pledge, claim, right of first refusal, lien (including, without
limitation any unpaid vendor's lien), deemed trust, option, hypothecation,
title retention or conditional sale agreement, lease, option, restriction as
to transfer, use or possession, easement, subordination to any right of
any other person, and any other encumbrance on the absolute and unfettered
use and ownership of any asset or property.
"Environmental Law" means any statute, law, code, regulation, order, notice,
rule, ordinance, or any requirement, restriction, limitation, condition or
obligation contained therein, including any and all plans, orders, decrees,
judgments, and notices issued, entered, promulgated, or approved thereunder,
purporting to regulate the use, misuse, pollution or preservation of land,
air and water resources including but not limited to those purporting to
regulate building and planning, industrial buildings, plants or equipment,
and health or safety, only as such are directly related to environmental
matters.
"FDA" means, collectively, the United States Food and Drug Administration,
and the Health Protection Branch of Health and Welfare Canada.
"Financial Statements" means the audited balance sheets of Dominion as of
December 31, 1995, 1994 and 1993 and the related audited statements of
income and cash flows for the years then ended, together with all footnotes,
annexes and schedules thereto, accompanied by the audit reports of Deloitte &
Touche, together with the Interim Financial Statements, and all notes
thereto, all of which balance sheets, statements of income and cash flow,
reports and notes have been attached to and incorporated into the Disclosure
Memorandum.
"Five Year Warrants" means options, in a form previously approved by the
parties, to purchase Immucor's Common Stock at an exercise price (the
"Closing Market Price") of the greater of Twelve U.S. Dollars (US$12.00) per
share or the last sale price per share reported on the last trading day
before the Closing Date as reported in The Wall Street Journal. The number
of shares included in the Five Year Warrants shall be the aggregate principal
amount of the Notes divided by the Closing Market Price.
"GAAP" means generally accepted accounting principles of Canada, consistently
applied.
"Hazardous Material" means any hazardous substance or any pollutant or
contaminant defined or included as such in (or for the purposes of) any
Environmental Law.
"Interim Balance Sheet" means the unaudited balance sheet of Dominion as of
October 31, 1996 and all notes thereto, prepared by Dominion management.
"Interim Financial Statements" means the unaudited Interim Balance Sheet and
the related unaudited statements of profit and cash flow for the 10-month
period ended October 31, 1996, prepared by management of Dominion.
"Immucor's Business" means the business of developing, manufacturing and
distributing blood bank reagents, testing equipment and related products for
grouping, typing, antibody screening and crossmatching blood and blood
components for transfusion.
"Immucor Guaranties" means the guaranties by Immucor/US of the payment of the
Notes in a form previously agreed to by the parties.
"Immucor/US" means Immucor, Inc., a Georgia, USA Corporation.
"Knowledge of Shareholder" (or words of similar import) refers to all those
things known by any Shareholder.
"Material" means, as to any matter or circumstance, that which an ordinarily
prudent person in the ordinary course of business would normally consider
material in determining the value of the assets, liabilities, business,
results of operation or prospects of a company.
"Notes" means the Subordinated Promissory Notes of Immucor/Canada guaranteed
by Immucor/US in the aggregate amount of Five Million Seven Hundred Forty-One
Thousand Canadian Dollars (CDN$5,741,000.00), bearing interest at 6%, payable
semiannually with principal due three (3) years after the Closing Date, in a
form previously approved by the parties.
"Nubio" means Nubio Technologies Corporation, a Delaware corporation and a
Dominion Shareholder.
"Permitted Encumbrance" means an Encumbrance identified as a "Permitted
Encumbrance" in the Disclosure Memorandum.
"Per Share Price" is defined in Section 2.02.
"Person" means a corporation, partnership, trust, limited liability company,
other business entity or an individual.
"Purchase Price" is defined in Section 2.02.
"Rule" means any law, statute, rule, regulation, order, court decision,
judgment or decree of any federal, state, territorial, provincial or
municipal authority or body.
"Shareholders" means, collectively, Samuel Brushett, Nubio, Patrick Waddy and
Blaine MacNeil, with Samuel Brushett and Nubio being deemed to be one
Shareholder with joint and several obligations hereunder.
"Shares" means all the shares of Dominion owned by the Shareholders, as set
forth in the Disclosure Memorandum.
"Social" refers to employment-related obligations of Dominion, including all
actual or contingent liabilities relating to unemployment coverage, health,
injury, death and retirement.
"Tax" or "Taxes" means all forms of levies, taxes, customs and other duties
normally deemed to be of a fiscal or customs nature, including but not
limited to (a) all taxes levied, imposed or assessed under the Income Tax Act
(Canada) or any other statute, rule, ordinance or law, in Canada or
elsewhere; (b) taxes in the nature of sales tax, consumption tax, value added
tax, payroll tax, group tax, undistributed profits tax, fringe benefits tax,
recoupment tax, withholding tax, land tax, water rates, municipal rates,
stamp duties, gift duties or other state, territorial, provincial or
municipal charges or impositions levied, imposed or collected by any
governmental body; and (c) any additional tax, interest, penalty, charge, fee
or other amount of any kind assessed, charged or imposed in relation to the
non-, late, short or incorrect payment of the same or the failure to file
any return.
"Ten Year Warrants" means Options to purchase an aggregate of 150,000 shares
of Immucor Common Stock at an exercise price equal to 120% of the last sale
price per share reported on the last trading day before the Closing Date as
reported in The Wall Street Journal, in a form previously approved by the
parties.
"Warranty" means any representation and warranty of any Shareholder in this
Agreement and in each certificate or other document delivered by him or on
his behalf in connection with this Agreement.
"1995 Balance Sheet" means the audited balance sheet of Dominion as of
December 31, 1995, accompanied by the audit report of Deloitte & Touche,
and all notes thereto.
ARTICLE II
TERMS OF TRANSACTION
2.1 Purchase and Sale of Shares of Dominion. Upon the terms and subject
to the conditions of this Agreement, at the Closing, Immucor/Canada shall
purchase from Shareholders, and Shareholders (excluding Samuel Brushett)
shall sell and transfer, to Immucor/Canada, all of the Shares. In addition,
Samuel Brushett shall cause Nubio to transfer all of its Shares to Immucor/
Canada.
2.2 Purchase Price. The aggregate price of the Shares (the "Purchase Price")
shall be Eleven Million, One Hundred Seven Thousand and 00/100 Canadian Dollars
(CDN$11,107,000.00).
2.3 Payment. In consideration of the sale and transfer to Immucor/Canada of
the Shares:
(a) At the Closing, Immucor/Canada shall make a cash payment to the
Shareholders in the aggregate amount of Four Million Nine Hundred
Thirty-Four Thousand Eight Hundred Forty-Four and 00/100 Canadian Dollars
(CDN$4,934,844.00) by wire transfer of immediately available funds to
accounts indicated for each Shareholder in the Disclosure Memorandum and,
on behalf of all Shareholders, Immucor/Canada shall make payment of Four
Hundred Thirty-One Thousand One Hundred Fifty-Six and 00/100 Canadian Dollars
(CDN$431,156.00) to the account of Patterson Palmer Hunt Murphy, Account No.
4601-470 Bank of Montreal, 5151 George Street, Halifax, NS B3J 2M9 (such
payments are collectively referred to herein as the "Cash Payment");
(b) At the Closing, Immucor/Canada shall execute and deliver the Notes to
Shareholders;
(c) Immediately after the Closing, Immucor/US shall execute and deliver the
Five Year Warrants to the Shareholders; and
(d) Immediately after the Closing, Immucor/US shall execute and deliver the
Ten Year Warrants to the Shareholders.
2.4 Allocation of Payment. The payment described in Section 2.3 above shall
be allocated among the Shareholders as follows:
Principal Shares Under Shares Under
Cash (CDN$) Amount of Note 5-Year Warrants 10-Year Warrants
Nubio 1,788,667.00 1,913,667.00 159,472 50,000
Waddy 1,288,667.00 2,413,667.00 201,139 50,000
MacNeil 2,288,667.00 1,413,667.00 117,806 50,000
2.5 Noncompetition Payment. At the Closing, Immucor/Canada on behalf of
Dominion, shall pay Mr. Brushett CDN$375,000.00 in consideration for his
covenants contained in Section 6.11 hereof (the "Noncompetition Payment").
The Noncompetition Payment shall be made by wire transfer of immediately
available funds to Mr. Brushett's account indicated in the
Disclosure Memorandum.
2.6 The Closing.
(a) The Closing shall take place at 10:00 a.m., December 11, 1996, in the
offices of Nelson Mullins Riley & Scarborough, L.L.P., Atlanta, Georgia, USA,
or on such other date and at such other time and place as the parties shall
agree in writing.
(b) At the Closing, Immucor/Canada shall deliver to the Shareholders the
following:
(i) the Cash Payment;
(ii) the Notes;
(iii) legal opinions of Immucor/Canada's counsel concerning the
due authorization, execution and delivery of this Agreement
and the Notes and the enforceability of this Agreement and
the Notes against Immucor/Canada, all in a form
reasonably acceptable to the Shareholders;
(iv) the Noncompetition Payment; and
(v) the Immucor Guaranties.
(c) At the Closing, the Shareholders shall deliver to Immucor/Canada the
following:
(i) the Disclosure Memorandum;
(ii) the certificates representing all of the Shares, endorsed in
blank for transfer to Immucor/Canada;
(iii) the duly executed resignations of all of the directors and
officers of Dominion effective as of the Closing Date;
(iv) Dominion's original corporate minute book;
(v) all other corporate records of Dominion; and
(vi) legal opinions of the Shareholders' counsel concerning,
among other things, Dominion's authorized and outstanding
capital stock, the due authorization, execution and delivery
of this Agreement by the Shareholders and Dominion, the
transfer of Dominion's shares and other reasonable
customary matters, all in a form reasonably acceptable to
Immucor/Canada;
(d) Immediately after the Closing, Immucor/US shall deliver to the
Shareholders the following:
(i) the Five Year Warrants;
(ii) the Ten Year Warrants; and
(iii) legal opinions of Immucor/US's counsel concerning the due
authorization, execution, and delivery of this Agreement,
the Five Year Warrants and the Ten Year Warrants, and
the enforceability of this Agreement, the Five Year
Warrants and the Ten Year Warrants, all in a form
reasonably acceptable to the Shareholders.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF
SHAREHOLDERS REGARDING THE SHARES AND SHAREHOLDERS
To induce Immucor/US and Immucor/Canada to execute, deliver and perform this
Agreement, and in acknowledgement of Immucor/US's and Immucor/Canada's
reliance on the following Warranties, Shareholders hereby represent and
warrant to Immucor/US and Immucor/Canada as follows (except that Samuel
Brushett and Nubio, and no other Shareholders, jointly and severally give
the representations and warranties in Section 3.2):
3.1 Power and Authority of Shareholders. Shareholders have the right,
power and capacity to execute, deliver and perform this Agreement and to
consummate the transactions contemplated hereby. The execution, delivery
and performance of this Agreement, the execution and delivery of the
Disclosure Memorandum and the consummation of the transactions contemplated
hereby, have been duly and validly authorized by all necessary action on the
part of Shareholders. Shareholders have obtained all necessary consents,
approvals, authorizations or estoppels of any other Person or governmental
or regulatory authority required to be obtained to authorize and permit
Shareholders to transfer, or cause to be transferred, to Immucor/Canada all
of the Shares. This Agreement has been duly and validly executed and
delivered by Shareholders and constitutes each Shareholder's legal, valid
and binding obligation, enforceable in accordance with its terms. The
execution and delivery of this Agreement by Shareholders, the execution and
delivery of the Disclosure Memorandum, the consummation of the transactions
contemplated herein by Shareholders, and the performance of the covenants
and agreements of Shareholders, will not, with or without the giving of
notice or the lapse of time, or both, (i) violate or conflict with any of
the provisions of any articles of incorporation or bylaws of Nubio;
(ii) violate, conflict with or result in a breach or default under or cause
termination of any term or condition of any mortgage, indenture, contract,
license, permit, instrument, trust document, or other agreement, document or
instrument to which Shareholders are a party or by which Shareholders or any
of their properties may be bound; (iii) violate any Rule; or (iv) result in
the creation or imposition of any Encumbrance upon any asset of Dominion.
3.2 Organization and Authority of Nubio.
(a) Nubio is a corporation duly incorporated and validly existing under the
laws of Delaware, USA and has all requisite power and authority, corporate or
otherwise, to carry on and conduct its business as it is now being conducted
and to own or lease its properties and assets.
(b) The copies of Nubio's articles of incorporation and bylaws that have
been previously delivered to Immucor/Canada or Immucor/US are complete, true,
valid and correct and are in effect as of the date hereof. The minutes of
directors' and shareholders' meetings of Nubio that have previously been
delivered to Immucor/Canada or Immucor/US are the complete, true, valid and
correct records of directors' and shareholders' meetings through and including
the date hereof and, reflect all transactions and other matters required to
be reflected in such records, as well as such other matters customarily
contained in records of such type.
(c) The current officers and directors of Nubio are listed in the Disclosure
Memorandum.
(d) The execution, delivery and performance of this Agreement, the execution
and delivery of the Disclosure Memorandum, and the consummation of the
transactions contemplated hereby, have been duly and validly authorized by
all necessary action, corporate or otherwise, on the part of Nubio.
3.3 Ownership of the Shares. Each Shareholder hereby represents that he or
it owns, of record (or in the case of Samuel Brushett, beneficially), good and
valid title to one-third (1/3) of the Shares, and such Shares are validly
issued and are free and clear of any Encumbrances, with no defects of title
whatsoever. Each Shareholder represents that at Closing, Immucor/Canada
shall obtain good and valid title to his or its Shares, free and clear of all
Encumbrances, with no defects of title whatsoever. Each Shareholder
represents that he or it has full and exclusive power, right and authority to
vote his or its Shares. Each Shareholder represents that he or it is not a
party to or bound by any agreement affecting or relating to its right to
transfer or vote the Shares. The number of issued shares of Dominion and
the record holders of such issued shares are set forth in the Disclosure
Memorandum.
3.4 Issued Shares. All issuances, transfers or purchases of the Shares
have been in compliance with all applicable agreements and all applicable
Rules, and all Taxes thereon have been paid. There are no Dominion treasury
shares.
3.5 Absence of Other Claims. Except as set forth in the Disclosure
Memorandum, there is not outstanding, nor is Dominion bound by, any
subscriptions, options, preemptive rights, warrants, agreements or rights of
any character requiring Dominion to issue or transfer any of its shares or
the voting rights thereto, including any right of conversion or exchange
under any outstanding security or other instrument. There are no outstanding
obligations of Dominion to repurchase, redeem or otherwise acquire any of
its outstanding Shares.
3.6 Shareholders Net Worth. Each of the Shareholders hereby represents
that its or his individual net worth, or joint net worth with such
Shareholder's spouse (other than Nubio), including the Shares held by such
Shareholder, exceeds US$1,000,000.00, and Samuel Brushett represents that he
is the sole shareholder of Nubio.
3.7 Citizenship. Messrs. Waddy and MacNeil each represent that they are
citizens and residents of Canada, and Mr. Brushett represents that he is a
citizen of Canada and a resident of the United States.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
THE SHAREHOLDERS REGARDING DOMINION
To induce Immucor/Canada and Immucor/US to execute, deliver and perform this
Agreement, and in acknowledgement of Immucor/Canada's and Immucor/US's
reliance on the following Warranties, Shareholders hereby represent and
warrant to Immucor/Canada and Immucor/US as follows:
4.1 Organization and Authority.
(a) Dominion is a commercial company duly incorporated and validly existing
under the laws of Nova Scotia and has all requisite power and authority,
corporate or otherwise, to carry on and conduct its business as it is now
being conducted and to own or lease its properties and assets. Dominion is
registered with the Office of the Registrar of Joint Stock Companies for the
Province of Nova Scotia as stated in the Disclosure Memorandum, in accordance
with applicable law, and the information contained in the extract of said
registration is complete and correct. All documents required to be filed
with the Office of the Registrar of Joint Stock Companies for the Province of
Nova Scotia with respect to Dominion have been properly and timely filed.
(b) Except as disclosed in the Disclosure Memorandum, Dominion has not
proposed a compromise or arrangement to its creditors; had any petition for
a receiving order filed against it; taken any proceeding with respect to a
compromise, arrangement or winding up, or otherwise taken advantage of any
insolvency or bankruptcy legislation; had a receiver appointed to any part of
its property; or had any execution or distress or seizure levied upon any
of its property.
(c) The Disclosure Memorandum sets forth (i) the name, address and
jurisdiction of organization of Dominion, (ii) every entity in which Dominion
owns any of the outstanding equity, directly or indirectly, (iii) the equity
interest in such entity that is owned by Dominion, and (iv) each such
entity's respective jurisdiction of organization.
(d) The copies of the Charter Documents that have been previously delivered
to Immucor/Canada or Immucor/US are the complete, true, valid and correct
Charter Documents of Dominion in effect as of the date hereof. The minutes
of directors' and shareholders' meetings of Dominion that have previously
been delivered to Immucor/Canada or Immucor/US are the complete, true, valid
and correct records of directors' and shareholders' meetings through and
including the date hereof and, reflect all transactions and other matters
required to be reflected in such records, as well as such other matters
customarily contained in records of such type.
(e) The current officers and directors of Dominion are listed in the
Disclosure Memorandum.
(f) The execution, delivery and performance of this Agreement, and the
consummation of the transactions contemplated hereby, have been duly and
validly authorized by all necessary action, corporate or otherwise, on the
part of Dominion.
4.2 Compliance With Law. Dominion has not violated any order of any court,
governmental authority, arbitration board or tribunal to which it is or was
subject, nor is Dominion in violation of any Rule the violation of which
would have a material adverse effect on Dominion, the transactions
contemplated by this Agreement, or Dominion's Business.
4.3 Financial Statements. The Financial Statements, including the footnotes
thereto, are true, complete and correct, have been prepared in accordance with
the Accounting Standards, consistently applied, and fairly present the
financial position of Dominion as of the dates thereof and the results of
its operations for the respective periods thereof. The Financial Statements
contain all disclosures required under the Accounting Standards as of the
dates of, and for the periods covered by, the Financial Statements.
4.4 Indebtedness. The Disclosure Memorandum sets forth a complete and
accurate list and description of all instruments or other documents relating
to any direct or indirect indebtedness for borrowed money of Dominion, as
well as indebtedness by way of lease-purchase arrangements, guarantees,
undertakings on which others rely in extending credit, and all conditional
sales contracts, pledges and other security arrangements with respect to
personal property used or owned by Dominion. Dominion is not in default
with respect to any indebtedness.
4.5 No Undisclosed Liabilities. Except as and to the extent reflected and
adequately reserved against on the Interim Balance Sheet, or as shown in the
Disclosure Memorandum on the schedule entitled "Material Liabilities or
Obligations", as of the date hereof Dominion had no material liabilities or
obligations whatsoever, whether accrued, absolute, contingent or otherwise.
4.6 Tax Matters.
(a) Tax Reserves. The amount of Dominion's liability for unpaid Taxes for
all periods ending on or before October 31, 1996 does not, in the aggregate,
exceed the amount of Dominion's liability accruals for Taxes shown on the
Interim Balance Sheet.
(b) Tax and Social Returns. Dominion has correctly and timely (i) filed all
Tax and Social returns required to be filed in the manner required by Tax and
Social authorities, (ii) responded to information requested by said
authorities and (iii) made all Tax and Social payments at due dates.
(c) Other Matters. Except as set forth in the Disclosure Memorandum: (i)
Dominion is not subject to income tax in countries other than Canada; (ii)
Dominion is a registrant for the purposes of the Goods and Services Tax and
its registration number is 101435816; (iii) Dominion has no tax loss carry
forwards; (iv) expenses already incurred or which Dominion is required to
incur in the ordinary course of its business are deductible from its
ordinary income; (v) Dominion has not entered into any transaction which
could be disregarded or recharacterized for Tax or Social purposes on the
grounds that it aimed at the avoidance of Tax or Social obligations; (vi)
Dominion is not the subject matter of any inquiry, investigation or
audit relating to Tax or Social matters and has not been informed of any
proposed audit; and (vii) each Shareholder represents that Dominion has
withheld all amounts required by any Rule to be withheld from, or paid on
account of, compensation paid to Dominion's officers, directors and
employees, or, alternatively, in the case of the Shareholders, each
Shareholder represents that he or it has paid or will pay when due, all
amounts required by any Rule to be paid on account of, compensation paid by
Dominion to such Shareholder.
(d) Tax and Social Audits. The Disclosure Memorandum sets forth the
conclusions of any Tax or Social audit or reassessment made during the
period not yet completely time barred by applicable statutes of limitation.
(e) Returns Furnished. Dominion has furnished Immucor/Canada or
Immucor/US with true and complete copies of (i) income tax audit reports,
statements of deficiencies, closing or other agreements received by or on
behalf of Dominion relating to Taxes, and (ii) all tax returns for Dominion
for all periods since July 1, 1993.
4.7 Products.
(a) All Dominion clones that are producing monoclonal antibody based
products are continuing to produce antibodies, and there has been no
discernable material deterioration in the quantity and quality of antibodies
produced.
(b) The master cell lines and frozen cell lines of the Dominion clones that
are currently producing antibodies are, and at all times have been, stored
under conditions designed to ensure future use.
(c) The Dominion frozen cell library of human lymphocytes are, and at all
times have been, stored under conditions designed to ensure future
investigational use.
(d) After the Closing Date, returns of products sold before the Closing
Date will not exceed CDN$20,000.00, in the aggregate, whether or not such
returns are in the ordinary course of business.
4.8 Litigation. Except as set forth in the Disclosure Memorandum, there is
no action, suit, investigation or proceeding pending or, to the knowledge of
any Shareholder, threatened against or affecting Dominion, Dominion's
Business or the assets of Dominion before any court or by or before any
governmental body or arbitration board or tribunal, nor to the knowledge of
Dominion or any Shareholder is there a basis for any action, suit,
investigation or proceeding.
4.9 Assets.
(a) Description. The Disclosure Memorandum sets forth a general description
and the location of all personal property and leasehold improvements included
in the assets of Dominion.
(b) Title. Dominion has good, valid and marketable title to all of its
assets, free and clear of any and all Encumbrances other than the Permitted
Encumbrances. In particular, Dominion has good and marketable title in fee
simple to the real property of Dominion described in the Disclosure
Memorandum (the "Lands") including the buildings located thereon (the
"Buildings"). No Permitted Encumbrance or other Encumbrance will materially
interfere with the conduct of Dominion's Business as conducted by Dominion
prior to the Closing Date; provided, however, that to the extent Permitted
Encumbrances exist in connection with a loan of money to Dominion, the
existence of such Permitted Encumbrance could materially interfere with the
conduct of Dominion's business in the event of a default under such loan.
Dominion owns all the real and personal property reflected on the Interim
Balance Sheet.
(c) Possession. Except as set forth on the Disclosure Memorandum, all
tangible assets of Dominion are on Dominion Premises, in its possession and
control. No one else has any right, title or interest in any property or
asset now used or proposed to be used by Dominion in Dominion's Business.
(d) All Necessary Assets. The assets of Dominion reflected on the Interim
Balance Sheet are all the assets necessary for the conduct of Dominion's
Business after the Closing in the same manner as it was conducted during the
12 months before the Closing.
(e) Condition. The assets of Dominion that constitute tangible personal
property (collectively, the "Dominion Properties") are in good condition and
repair, ordinary wear and tear excepted, in satisfactory working order, and
are suitable for their respective intended uses. The plants and structures
owned, leased or used by Dominion are structurally sound with no known
material defects.
(f) Compliance. Dominion Properties and the existing and prior uses thereof
are in compliance in all material respects with all applicable Rules.
Dominion has delivered to Immucor/Canada or Immucor/US all reports and
documents generated by Dominion or any third party about the condition of
Dominion Properties or about such compliance.
(g) Inventory. All of Dominion's inventory included on the Interim Balance
Sheet is of a quality usable and saleable in the ordinary and usual course of
Dominion's Business, and the quantities of each type of inventory (whether
raw materials, work-in-process, or finished goods) are not excessive, but
are reasonable, adequate and appropriate in Dominion's present circumstances.
All of such inventory is valued for the purposes of the Interim Balance
Sheet at the lower of cost or net realizable market value. The Disclosure
Memorandum contains the following information for all of Dominion's
monoclonal antibodies and cell lines: (i) product type and description;
(ii) clone number; (iii) whether it is approved by the FDA, whether license
applications have been submitted to the FDA and are pending approval, or
whether it is in clinical trials; and (iv) whether such product is under
development.
(h) Product Dating. Unless otherwise provided in the Disclosure
Memorandum, all of Dominion's antisera products have no less than one (1)
year dating and all of Dominion's reagent red blood cell products are in
date; provided, however, products having a total aggregate value of less
than CDN$10,000 shall be exempt from the representations contained in this
Section 4.9(h).
(i) Accounts Receivable. Except as set forth in the Disclosure Memorandum:
(i) all accounts receivable of Dominion included on the Interim Balance Sheet
are valid, existing and fully collectible within two (2) years after their
respective due dates, subject to the allowance for bad or doubtful accounts,
as shown on the Interim Balance Sheet, and assuming with respect to any
particular account that after the Closing Dominion does not terminate the
account debtor for any reason other than nonpayment; (ii) on the Closing
Date all accounts receivable of Dominion represent monies due for goods sold
or services rendered in the ordinary course of business; and (iii) to the
knowledge of each Shareholder, on the Closing Date no accounts receivable of
Dominion are subject to any defenses, rights of set-off, assignment or other
Encumbrances. To the knowledge of each Shareholder there is no dispute
regarding the collectability of any such accounts receivable. Dominion has
provided Immucor/Canada with a current, complete and accurate aging report of
such accounts receivable. Except as set forth in the Disclosure Memorandum,
there are no accounts receivable included in the assets of Dominion that are
owed to Dominion by any director, officer, shareholder or employee of
Dominion or any relative of any such person.
(j) Real Property. Dominion owns no real property other than the Lands,
legal descriptions of which have been included in the Disclosure Memorandum.
The Shareholders have made available to Immucor/Canada true, correct, and
complete copies of the following with respect to each parcel of real property
listed or described in the Disclosure Memorandum: the deed evidencing
Dominion's ownership of such real property; each Encumbrance thereon
reflected in a written instrument; each instrument (if any) evidencing a
grant by or to Dominion of an option to purchase or lease such property;
each lease and leasehold mortgage (if any) with respect to such property; and
any surveys, locating certificates, plans, drawings, studies or other
information in possession of Dominion or the Shareholders with respect to
such property. Except for Permitted Encumbrances and other matters set
forth in the Disclosure Memorandum, no real property owned, leased or used
by Dominion is subject to (i) any governmental decree or order (or threatened
or proposed order known to Dominion) to be sold or expropriated by public
authority; or (ii) any rights of way, building use restrictions, exceptions,
variances, reservations or limitations of any nature whatsoever, not of record.
(k) Land and Buildings. To the knowledge of each Shareholder the Buildings
were constructed and completed in accordance with all necessary building
permits and approvals, no changes have been made to the Buildings which do
not comply with all building permits, building restrictions (including
private deed restrictions, if any), laws, bylaws, requirements, regulations
or ordinances, and the Buildings are now and shall at the Closing Date be
used and occupied in compliance with all building permits, building
restrictions (including private deed restrictions, if any), laws, by-laws,
requirements, regulations and ordinances.
(l) Utilities. The facilities of water, power and other utilities
installed in or about the Lands and Buildings are adequate for Dominion's
Business as it previously has been conducted, such facilities are in good
and usable condition and no orders, requests, demands or other communications
have been received by Dominion or the Shareholders or by anyone on their
behalf, requiring or requesting any changes, modifications or alterations
thereof.
(m) Access. There is full ingress and egress for pedestrians and vehicles to
and from the Lands and the Buildings and the public roads abutting or adjacent
to the Lands adequate to allow Dominion to conduct its business in the manner
it previously has been conducted.
(n) Interests in Other Persons. Dominion does not own, either legally or
beneficially, directly or indirectly (i) any shares or other securities
convertible into shares of any other company or (ii) any participating
interest in any partnership, limited liability company, trust, joint venture,
association or other non-corporate business enterprise.
4.10 Bank Accounts. The Disclosure Memorandum contains a list of all the
checking, depository or other bank accounts and any safe deposit boxes of or
relating to the assets, operations or business of Dominion, together with
the authorized signers.
4.11 Suppliers and Customers. The Disclosure Memorandum contains a list of
each supplier of goods or services to, and each customer of, Dominion to whom
Dominion paid or billed in the aggregate more than CDN$100,000.00 during the
12-month period ended December 31, 1995, and more than CDN$85,000.00 during
the 10-month period ended October 31, 1996, together in each case, with the
amount paid or billed during such period. Except as set forth in the
Disclosure Memorandum there are no disputes between Dominion (or any of
Dominion's employees or representatives) and any of Dominion's significant
suppliers, customers or others having business with Dominion. To the
knowledge of each Shareholder, except as set forth in the Disclosure
Memorandum neither the consummation of the transactions contemplated
hereunder, nor any other event, including the passage of time, will have
any adverse effect on the business relationship of Dominion with any such
supplier or customer.
4.12 Trade Secret and Employment Claims. To the knowledge of each
Shareholder, no third party has claimed that Dominion, any Shareholder, or
any director, officer, manager, employee or agent of Dominion, in respect of
activities on behalf of Dominion or in respect of the operations of
Dominion's Business to date, has (i) violated any of the terms or conditions
of any employment contract with a third party, (ii) infringed any patent,
trademark or copyright of a third party, (iii) disclosed or used any trade
secrets or (iv) proprietary information or documentation of such third party,
or interfered in the employment relationship between a third party and any of
his or its employees; nor, to the knowledge of each Shareholder, has any such
violation, disclosure, use or interference occurred.
4.13 Intellectual Property.
(a) The Disclosure Memorandum lists and describes: (i) all patents, patent
applications, trade names, business names, trademarks, service marks,
trademark and service mark registrations and applications, and all patent,
trademark and service mark licenses, and describes all copyrights, computer
software, data bases and all other intellectual property, that are owned by
or registered in the name of Dominion or to which Dominion has any rights as
licensee or otherwise, which list specifies which items are owned and to
which items Dominion has rights as a licensee or otherwise; and (ii) all
contracts, agreements or understandings pursuant to which Dominion has
authorized any person to use, or which any person otherwise has the right to
use, in any business or commercial activity, any of the items listed in
clause (i) above.
(b) The items listed or described in the Disclosure Memorandum pursuant to
the preceding subsection (a) constitute or represent all of the intellectual
property necessary to the conduct of Dominion's Business, and Dominion's
ownership and use rights with respect thereto are free and clear of
Encumbrances other than Permitted Encumbrances.
(c) All trademark or service mark registrations, and all applications to
register any trademarks, or service marks or any trademark register
maintained by the U.S. government, Canadian government, or any state or
provincial government are based on truthful applications, filings and
declarations of use.
(d) To the knowledge of each Shareholder, except as set forth in the
Disclosure Memorandum Dominion has not infringed upon any patent, service
mark, trade name, business name, trademark, copyright, trade secret or other
intellectual property belonging to any other Person; and Dominion has not
agreed to indemnify any Person for or against any infringement of or by the
intellectual property set forth in the Disclosure Memorandum. To the
knowledge of each Shareholder, no person is infringing upon any of Dominion's
patents, patent applications, trade names, business names, trademarks,
service marks, trademark and service mark registrations, licenses,
copyrights, computer software or other intellectual property.
(e) Dominion has all computer software and databases that are necessary to
conduct Dominion's Business as presently conducted by Dominion and all
documentation relating to all such computer software and databases.
4.14 Contracts. The Disclosure Memorandum sets forth a list of all Dominion
Contracts relating to Dominion's Business that continue for more than six (6)
months after the date hereof, that involve the payment or receipt of more
than CDN$50,000.00, that relate to the distribution of products in countries
other than Canada, or that are otherwise material to Dominion's Business or
prospects. Except as set forth in the Disclosure Memorandum:
(a) each of such Dominion Contracts is in full force and effect and
constitutes a binding obligation of all parties thereto, enforceable in
accordance with its terms; and none of such Dominion Contracts has been
canceled or otherwise terminated, and, to the knowledge of each Shareholder,
there is no threat to do so.
(b) to the knowledge of each Shareholder, there are no existing defaults or
events of default, real or claimed, or events (including the sales of the
Shares) which with notice or lapse of time or both would constitute defaults
under any such Dominion Contract.
(c) there are no Dominion Contracts relating to Dominion's Business or the
assets of Dominion with any director, officer or shareholder of Dominion, or
with any person related to any such person or with any company or other
organization in which any director, officer, or shareholder of Dominion or
anyone related to any such person, has a direct or indirect financial
interest.
(d) neither Dominion nor any Shareholder is subject to any contract or
agreement:
(1) that contains covenants limiting the freedom of Dominion
to compete in any line of business in any geographic area;
(2) that requires Dominion to share any profits, or requiring
any payments or other distributions based on profits, revenues or cash flows;
(3) pursuant to which third parties have been provided with
products that can be returned to Dominion in the event they are not sold and
which could involve products valued at CDN$25,000.00 or more (invoice price)
in the aggregate; or
(4) that, to the knowledge of any Shareholder, has had or may
in the future have a material adverse effect upon the business, earnings or
financial condition of Dominion.
4.15 Leases. The Disclosure Memorandum contains a complete and accurate list
of all leases (including any capital leases) and lease-purchase arrangements
pursuant to which Dominion leases real or personal property from others and
which (i) require Dominion to pay more than CDN$5,000.00 in any single year
or CDN$25,000.00 during the entire term of such lease or lease-purchase
arrangement, or (ii) provide for a purchase option for a price of more than
CDN$25,000.00. Dominion's possession of such property has not been disturbed,
nor has any claim been asserted against Dominion adverse to its rights in
such leasehold interests. All leases that are required to be capitalized by
the Accounting Standards have been so accounted for in the Financial
Statements, and such leases are identified as capital leases in the
Disclosure Memorandum.
4.16 Permits and Regulatory Compliance.
(a) General. Except as set forth in the Disclosure Memorandum Dominion
holds free and clear all permits, licenses, approvals, franchises and
authorizations from governmental and regulatory authorities as are necessary
to conduct Dominion's Business, including but not limited to establishment
licenses and product licenses and approvals (the "Dominion Permits").
Dominion has been issued FDA Establishment License No. 1151. The Disclosure
Memorandum identifies and describes all applications for a Dominion Permit
filed by or on behalf of Dominion. To the knowledge of each Shareholder, no
event has occurred that allows (nor after notice or lapse of time or both
would allow) revocation or termination of any Dominion Permit or application
therefor, or would result in any other material impairment of the
rights of the holder of any Dominion Permit.
(b) FDA Compliance. Dominion's Business is being conducted in all material
respects in accordance with all laws, rules, regulations, directives, and
similar pronouncements of the FDA and all other governmental or quasi-
governmental bodies operating in the United States or Canada, or in any
country where Dominion's Business is conducted or having jurisdiction over
any aspect of Dominion's Business.
(c) Inspections, Recalls, Etc. Dominion has previously made available to
Immucor/US or Immucor/Canada all information in Dominion's or any
Shareholder's possession concerning:
(i) FDA inspections of any of the Dominion Premises, and all
documentation produced in connection therewith, including but not limited to
Notices of Observations (Form 483), warning letters and Inspection Reports
(EIRs);
(ii) recalls (voluntary or involuntary) and product withdrawals;
and
(iii) product complaints and complaint trend analyses.
4.17 Labor Matters.
(a) Dominion is in compliance in all material respects with all Rules
respecting employment and employment practices, terms and conditions of
employment, wages and hours.
(b) Dominion is not and has not been engaged in any unfair labor practice,
and no unfair labor practice complaints against Dominion are pending before
the Nova Scotia Labour Relations Board or similar authority. To the
knowledge of each Shareholder: there are no labor strikes or other labor
troubles actually pending, being threatened against, or affecting
Dominion; relations between management and labor are amicable; and there
have not been, nor are there presently, any attempts or plans to organize
Dominion's employees.
(c) There is no agreement, arrangement or understanding between Dominion
and any trade union or employee association, any representative of any trade
union or any bargaining unit in respect of any of the Employees.
(d) Dominion has not done or omitted to do any act or thing the doing or
omission of which is or could be a breach of:
(1) any provision contained in any ruling or award of the
Canadian or Nova Scotia Labour Relations Board;
(2) any determination or order of any tribunal, person or body
empowered to determine any dispute relating to the rights or duties of
Dominion, or of any trade union or member of a trade union pursuant to any
ruling or award of the Canadian or Nova Scotia Labour Relations Board;
(3) any term contained or implied in any recognition agreement
between Dominion and any trade union;
(4) any term contained or implied in any agreement between
Dominion and any of the Employees; or
(5) any provision of any arrangement, practice, custom or
understanding (whether or not legally enforceable) between any trade union
and Dominion; which leads or could lead to any industrial action or cause
any labor problems.
4.18 Employees.
(a) The Disclosure Memorandum sets forth as to each Employee: (i) his or
her name, (ii) the location of employment, (iii) the date on which he or she
was hired, (iv) the basic annual, weekly or hourly rate of pay for the
Employees (separately listing any bonus), (v) the date and amount of his or
her last raise and next scheduled raise, (vi) a true and correct statement
of each of the Employee's accrued sick leave entitlement up to the Closing
Date, (vii) a true and correct statement of each of the Employee's accrued
vacation up to the Closing Date, and (viii) a true and correct statement of
all other benefits actually or contingently accruing to any Employee as of
the Closing Date.
(b) The Disclosure Memorandum sets forth as to each officer or other
manager of Dominion, the information described in subsection (a) above, as
well as the current compensation rate (salary, bonus, commission or other)
for each such person.
(c) Dominion has made all deductions required by Canadian law to be made
from employees', officers' and directors' remuneration and has made all
necessary remittances to all relevant authorities in respect of such
deductions.
(d) Except as set forth in the Disclosure Memorandum, Dominion has not
entered into any agreement with any Employee, for a fixed term or otherwise.
All employment agreements between Dominion and any Shareholder have been
terminated by the Shareholders with no rights continuing after the Closing
Date and each Shareholder has hereby released Dominion from all such
obligations thereunder. Mr. Brushett hereby resigns as an employee of
Dominion, and Dominion has no further obligations to Mr. Brushett as a
Dominion employee.
(e) Since January 1, 1996, except as set forth in the Disclosure Memorandum
all Employees due to receive raises to date have received such raises.
(f) During the last five (5) years no major accident has occurred at Dominion
Premises.
(g) To the knowledge of each Shareholder, no key Employee of Dominion has
indicated that he or she will voluntarily leave Dominion in connection with
or as a result of the transfer of the Shares to Immucor/Canada hereunder.
(h) Dominion has made available to Immucor/Canada all employment records
for each Employee, and all such records are complete and accurate in all
material respects.
4.19 Employee Benefit Plans and Arrangements.
(a) Social Matters. Dominion has correctly and timely (i) filed all Social
returns required to be filed in the manner required by Social authorities,
(ii) responded to information requested by said authorities, and (iii) made
all Social payments at due dates. Dominion has not entered into any
transaction that could be disregarded or recharacterized for Social purposes
on the grounds that it aimed at the avoidance of Social obligations. Except
as specified in the Disclosure Memorandum, Dominion is not the subject matter
of any inquiry, investigation or audit relating to Social matters, nor has it
been informed of any proposed inquiry, investigation or audit, nor, to the
Shareholders' knowledge, has it done anything that reasonably could be
expected to cause such an inquiry, investigation or audit. The Disclosure
Memorandum contains a copy of the conclusions of any Social audit or
reassessment during all periods not yet time barred by applicable statute of
limitation.
(b) List and Description of Plans and Arrangements. The Disclosure
Memorandum sets forth a complete and accurate list and description of all
agreements, arrangements, commitments, policies or understandings of any
kind (whether written or oral) (A) which relate to Social matters; (B) which
otherwise pertain to present or former employees, retirees, directors or
independent contractors (or their beneficiaries, dependents or spouses) of
Dominion or its predecessors in interest; and (C) which are currently or
expected to be adopted, maintained by, sponsored by, or contributed to by
Dominion, any of its predecessors in interest, or as to which Dominion of
any of its predecessors in interest has any ongoing liability or
obligation whatsoever (collectively, "Employee Benefit Plans").
(c) Compliance with Rules. Except as set forth in the Disclosure
Memorandum, Dominion and its predecessors in interest have complied in all
material respects with all Rules and other obligations with respect to all
Employee Benefit Plans.
(d) Copies of Documents Provided to Immucor/Canada. Dominion has made
available to Immucor/Canada true, correct and complete copies of all
documents relating to the Employee Benefit Plans that Immucor/Canada has
requested, including, but not limited to: (A) all plan texts, amendments,
trust instruments and other agreements adopted or entered into in connection
with each of the Employee Benefit Plans; (B) all insurance and annuity
contracts related to any Employee Benefit Plan; (C) the notices and election
forms used to notify employees and their dependents of their continuation
coverage rights under Dominion's group health plans, if applicable; and (D)
the most recently available annual reports, certified financial statements,
actuarial reports and summary plan descriptions, if applicable, for Employee
Benefit Plans. Since the date such documents were supplied to
Immucor/Canada, no plan amendments have been adopted and no changes to the
documents have been made.
(e) Agreements to Create, Continue or Terminate Plans. Neither Dominion
nor its predecessors in interest have any agreement, arrangement, commitment
or understanding, whether legally binding or not, to create any additional
Employee Benefit Plan or to continue, modify, change in any material respect,
or terminate any existing Employee Benefit Plan.
(f) Agency Review, Taxes and Fiduciary Liability. None of the Employee
Benefit Plans is currently under investigation, audit or review by any
relevant authority of Canada or is liable for any Taxes. To the knowledge
of each Shareholder, there is no transaction in connection with which
Dominion or any fiduciary of any of the Employee Benefit Plans could
be subject to either a civil penalty, liability or Tax.
(g) Claims Against Plans and Fiduciaries. Other than routine claims for
benefits payable to participants or beneficiaries in accordance with the
terms of the Employee Benefit Plans, there are no claims, pending or, to the
knowledge of each Shareholder, threatened, by any participant or beneficiary
against any of the Employee Benefit Plans or any fiduciary of any of the
Employee Benefit Plans, and to the knowledge of each Shareholder, no
basis for any such claim or claims exists.
(h) Insurance Reserves. The levels of insurance reserves and accrued
liabilities with regard to all Employee Benefit Plans (to which such
reserves or liabilities do or should apply) are set forth in the Disclosure
Memorandum, and such levels are reasonable and sufficient to provide for all
incurred but unreported claims and any retroactive or prospective
premium adjustments.
(i) Retiree Welfare Benefits. Neither Dominion nor its predecessors in
interest have maintained an Employee Benefit Plan providing group health,
dental, vision, life insurance or other welfare benefits to employees
following retirement or other separation from service, except as disclosed
in the Disclosure Memorandum.
(j) Financial Obligations. Except as stated in the Disclosure Memorandum,
Dominion does not owe any sum to any Employee, except for unpaid salaries,
holidays and vacation accrued in the ordinary course of business for 1996
but unpaid, and expense reimbursements accrued in the ordinary course of
Dominion's Business. There is no Employee Benefit Plan that could result in
a later charge against Dominion which has not been reserved for on the
Interim Balance Sheet. Dominion, in case of termination of any Employee,
would not be required to pay any indemnity nor give any notice other than,
in the case of termination of salaried Employees, the minimum indemnities
and notices required under law and under any applicable collective
bargaining agreement for Employees of the class concerned.
4.20 Environmental Matters.
(a) To each Shareholder's knowledge, Dominion has not been at any time in,
and no condition or event has occurred in relation to Dominion's Business
which with notice or the passage of time or both would constitute, a material
violation or contravention of any Environmental Law or any licenses, approvals,
consents, permissions or permits issued under any Environmental Law.
(b) Dominion has not received any statement or written notice of any
outstanding breaches of any laws or regulations dealing with environmental
matters or dealing with the omission deposit, issuance, discharge,
transportation or disposal of any contaminant, waste material or other
substance into or over the atmosphere, the soil, ground water or water.
(c) To the knowledge of Dominion and each Shareholder, Dominion Premises
are not contaminated nor are they in such condition as to justify or lead
any government or semi-government body to issue any notice, direction or
order requiring clean-up, decontamination, remedial action or making good
under any Environmental Law.
(d) To the knowledge of Dominion and each Shareholder, except as set forth
in the Disclosure Memorandum: (i) there are no circumstances whatsoever
affecting Dominion Premises or Dominion's Business or operations conducted
by or on behalf of Dominion in connection with Dominion's Business which may
give rise to a claim by any third party arising from property damage or
personal injury or death caused by any Hazardous Material of whatever
nature caused or contributed to in whole or in part by Dominion or Dominion
Premises, operations or business of Dominion; (ii) there are no Hazardous
Materials in, on or under Dominion Premises; (iii) there are no current and
there have not been any past releases of Hazardous Materials from or onto
Dominion Premises that are or were subject to regulation under any
Environmental Law, or that may make Dominion or Immucor/Canada subject to an
action under any Rule, or liable in tort or under a common law public or
private nuisance action; and (iv) Dominion Premises and all activities
conducted thereon have complied in all material respects with all applicable
Environmental Laws. Neither Dominion nor anyone related to Dominion,
directly or indirectly, has indemnified any other party with respect to
transportation, storage or use of Hazardous Materials.
(e) Except as set forth in the Disclosure Memorandum, Dominion has
obtained from all governmental, local and other relevant authorities or
agencies all necessary licenses or other authorizations required under the
Environmental Laws in relation to the carrying on of Dominion's Business.
All such licenses and authorizations have been granted on the basis that
they are unconditional and do or did not require the undertaking or
performance by Dominion of any obligation of any nature (including,
without limitation, any obligation to make any payment of any nature to any
person), remain in full force and effect and permit the carrying on by
Dominion of Dominion's Business and all activities related thereto on the
basis disclosed to Immucor/Canada, and at least at the same level of
activity as has existed in relation thereto over the period of one (1) year
prior to the date hereof. No such permit, license or authorization
has been revoked, amended, terminated or withdrawn, or to each Shareholder's
knowledge, is in any way subject to revocation or amendment or liable to be
terminated or withdrawn.
(f) The Disclosure Memorandum sets forth a list of all underground storage
tanks ("USTs") and other underground storage facilities presently located on
Dominion Premises and, to the knowledge of Dominion and each Shareholder,
all USTs and other underground storage facilities previously located at
Dominion Premises. All USTs and underground storage facilities on Dominion
Premises have been registered or licensed as required by Environmental Law;
all USTs and underground storage facilities comply with all present
Environmental Laws, as such requirements now exist; no removal of,
alteration of, addition to, or replacement of such USTs is or will be
required; all USTs and underground storage facilities on Dominion Premises
are sound and have not leaked, emitted, or released any regulated substances
into the environment, including the soil surrounding the storage tanks and
all groundwater at or near Dominion Premises; and all USTs and underground
storage facilities meet all requirements for corrosion protection, leak
detection, and spill and overflow protection which are now applicable
under present Environmental Law.
(g) To the knowledge of each Shareholder, except as set forth in the
Disclosure Memorandum no building or other improvement on Dominion Premises
contains any asbestos-containing materials.
(h) To the knowledge of each Shareholder, except as set forth in the
Disclosure Memorandum Dominion Premises do not contain any PCBs in any form.
(i) To the knowledge of each Shareholder, the Buildings are not insulated
with and do not contain asbestos or urea formaldehyde.
4.21 Insurance Policies. The Disclosure Memorandum on the schedule entitled
"Insurance Policies" sets forth a complete and accurate list and description
of all insurance policies in force naming Dominion, or any employees thereof
in the capacity as such, as an insured or beneficiary or as a loss payable
payee, or for which Dominion has paid or are obligated to pay all or part of
the premiums (other than policies of life or disability insurance which are
described elsewhere in the Disclosure Memorandum). Dominion has not received
notice of any pending or threatened termination or premium increase
(retroactive or otherwise) with respect thereto, and Dominion is in
compliance with all conditions contained therein. There have been no lapses
(whether cured or not) in the coverage provided under the insurance
policies, referenced herein and as set forth in the Disclosure Memorandum.
4.22 Events After October 31, 1996. Except as set forth in the Disclosure
Memorandum, since October 31, 1996, Dominion has conducted its business only
in the ordinary course, consistent with reasonable past practices, and has not:
(a) suffered any operating loss, or had any reduction in its retained
earnings;
(b) suffered any material property or casualty loss, or waived any material
right;
(c) made any changes in the compensation of, or paid any bonus to, or
modified any contractual arrangement with, any director, officer or employee
other than in the ordinary course of business consistent with past practices,
or increased (or announced any increase in) any bonus, insurance, pension or
other employee benefit plan, payment or arrangement, or entered into or
amended any employment, consulting, severance or similar agreement, other
than Dominion's accrued bonuses for 1995 which were paid by August 31,
1996 and bonuses previously accrued at June 30, 1996 in the amount of
CDN$375,018 of which CDN$125,006 was paid by the Closing Date;
(d) made any changes in other employee compensation, or paid any other
bonus, except in the ordinary course of business and consistent with
reasonable past practice;
(e) lost a major customer or vendor, suffered a material deterioration in any
of its other significant relationships, or experienced any other material
adverse change in any aspect of Dominion's Business or in its prospects;
(f) made any change in any method, practice or principle of financial or tax
accounting;
(g) made any sales on terms (including but not limited to discounts, extended
payment terms and other incentives) materially inconsistent with reasonable
prior practices;
(h) entered into any material commitment or transaction affecting Dominion's
Business;
(i) increased an asset related to a transaction with a customer that was not
authorized by such customer, or reduced a liability related to a transaction
with a supplier that was not authorized by such supplier;
(j) failed to maintain the Financial Statements and its books of account in
accordance with the Accounting Standards;
(k) sold, assigned, transferred or encumbered any of its assets or affected
the carrying value of any its liabilities, or entered into any arrangement to
purchase assets and/or assume liabilities (except in each case as required in
the ordinary course of business);
(l) paid, discharged, satisfied or renewed any claim, liability or obligation
other than payment in the ordinary course of business and consistent with
reasonable past practice;
(m) made any distribution or declared or paid any dividends to any
shareholders, received any capital contribution, or redeemed, purchased or
otherwise acquired any shares of Dominion's capital;
(n) made any payment of cash or any transfer of other assets, to any
shareholder or affiliate thereof, or paid, loaned, advanced, sold,
transferred or leased any asset to any employee, except for normal
compensation involving salary and benefits;
(o) failed to maintain its assets and continue with all contractual
obligations in accordance with their respective terms;
(p) failed to manage working capital components (including cash,
receivables, other current assets, trade payables and other current
liabilities) in a fashion consistent with reasonable past practices,
including failing to sell inventory and other property in an orderly and
prudent manner or failing to make all budgeted and other normal capital
expenditures, repairs, improvements and dispositions;
(q) failed to use commercially reasonable efforts to increase its sales in a
profitable manner, enhance its financial position, preserve its business, keep
available the services of its present employees, and preserve the goodwill of
its customers, suppliers and others having business relations with it; or
(r) agreed to take any action described in this Section 4.22.
4.23 Copies Provided to Immucor/Canada. Dominion has given or made available
to Immucor/Canada, true, correct and complete copies of each of the contracts,
agreements, instruments and other documents listed in the Disclosure
Memorandum.
4.24 Brokers. No broker or finder has acted on behalf of Dominion or
Shareholders in connection with this Agreement and the transactions set
forth herein, and neither Dominion nor any Shareholder has made any other
agreement to pay any agent, finder, broker or any other representative
any fee or commission in the nature of a finder's or originator's fee arising
out of or in connection with the subject matter of this Agreement.
4.25 Adverst Information. Neither Dominion nor Shareholders have knowingly
withheld information about any conditions, facts or circumstances that have had
or reasonably could be expected to have a material adverse effect on the value
of the assets of Dominion or Dominion's Business to Immucor/Canada.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF IMMUCOR/CANADA AND IMMUCOR/US
5.1 Organization, Power and Authority of Immucor/Canada.
(a) Immucor/Canada is a company duly incorporated and validly existing under
the laws of Nova Scotia and has all requisite power and authority, corporate
or otherwise, to carry on and conduct its business and to own or lease its
properties and assets. Immucor/Canada is registered with the Office of
the Registrar of Joint Stock Companies for the Province of Nova Scotia and all
documents required to be filed with the Office of the Registrar of Joint Stock
Companies for the Province of Nova Scotia with respect to Immucor/Canada
have been properly and timely filed.
(b) The Copies of Immucor/Canada's Memorandum of Association and
Articles of Association that have been previously delivered to Shareholders
are the complete, true, valid and correct Memorandum of Association and
Articles of Association of Immucor/Canada as of the date hereof.
(c) The execution, delivery and performance of this Agreement, and the
consummation of the transactions contemplated hereby, have been duly and
validly authorized by all necessary action, corporate or otherwise, on the
part of Immucor/Canada. This Agreement constitutes Immucor/Canada's legal,
valid, and binding obligation, enforceable in accordance with its terms.
(d) Immucor/Canada has obtained all necessary consents, approvals,
authorizations or estoppels of any other Person or governmental or regulatory
authority required to be obtained to authorize and permit Immucor/Canada to
purchase all of the Shares. The execution and delivery of this Agreement,
and the consummation of the transactions contemplated herein by Immucor/
Canada, and the performance of the covenants and agreements will not, with
or without the giving of notice or the lapse of time, or both, (i) violate
or conflict with any of the provisions of any Memorandum of Association or
Articles of Association of Immucor/Canada; (ii) violate, conflict with or
result in a breach or default under or cause termination of any term or
condition of any mortgage, indenture, contract, license, permit, instrument,
trust document, or other agreement, document or instrument to which Immucor/
Canada is a party or by which Immucor/Canada or any of its properties may be
bound; or (iii) violate any Rule. Immucor/Canada has the right, power and
capacity to execute, deliver and perform this Agreement and to consummate
the transactions contemplated hereby.
5.2 Power and Authority of Immucor/US. Immucor/US has the right, power and
capacity to execute, deliver and perform this Agreement and to consummate the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement, the execution and delivery of Five Year Warrants, Ten Year
Warrants and the guaranty of Immucor/US and the consummation of the
transactions contemplated hereby, have been duly and validly authorized by
all necessary action on the part of Immucor/US. This Agreement, Five Year
Warrants, Ten Year Warrants, and the guaranty of Immucor/US have been duly
and validly executed and delivered by Immucor/US and constitute Immucor/US's
legal, valid and binding obligation, enforceable in accordance with their
terms. The execution and delivery of this Agreement, Five Year Warrants,
Ten Year Warrants, and the guaranty of Immucor/US and the consummation of
the transactions contemplated herein by Immucor/US, will not, with or without
the giving of notice or the lapse of time, or both, (i) violate or conflict
with any of the provisions of the Articles of Incorporation or Bylaws of
Immucor/US; (ii) violate, conflict with or result in a breach or default
under or cause termination of any term or condition of any mortgage,
indenture, contract, license, permit, instrument, trust document, or other
agreement, document or instrument to which Immucor/US is a party or by which
Immucor/US or any of its properties may be bound; or (iii) violate any Rule.
5.3 Shares Issued Pursuant to Warrants. When issued, the shares of
Immucor/US issued pursuant to the Five Year Warrants and the Ten Year
Warrants will be legally and validly issued, fully paid and non-assessable.
5.4 Maintaining Work Force. Immucor/US and Immucor/Canada currently do not
have any plan to reduce the number of employees at Dominion's facility in
Dartmouth, Nova Scotia after the Closing, except for possible changes in the
direct sales force and for such other changes that may be made in the
exercise of reasonable business practices, including but not limited to
dealing with the impact of future acquisitions. Immucor does not intend to
change the location of Dominion's manufacturing facility.
ARTICLE VI
COVENANTS OF THE PARTIES
6.1 Cooperation. Dominion and Shareholders, on the one hand, and
Immucor/Canada, on the other hand, shall cooperate fully with each other and
their respective employees, legal counsel, accountants and other
representatives and advisers in connection with the steps required to be
taken as part of their respective obligations under this Agreement; and
shall, upon the request of the other, do, execute, acknowledge and deliver,
or will cause to be done, executed, acknowledged and delivered, all such
further acts, deeds, assignments, transfers, conveyances, powers of attorney,
receipts, acknowledgments, acceptances and assurances as may be reasonably
required to satisfy and perform the obligations of such party hereunder.
6.2 Records. The Shareholders shall provide to Immucor/Canada, as soon as is
reasonably practicable, copies of any and all files, records or other data
maintained by Dominion in respect of or relating to the day to day operations
of Dominion's Business.
6.3 Use of Dominion Name. The Shareholders and Dominion's directors,
officers, employees, agents and representatives shall cease to use the name
"Dominion Biologicals" (or any variation thereof) for any business purpose,
except as employees or agents of Dominion or Immucor/Canada, or for the
benefit of Dominion, Immucor/Canada, Immucor/US and their affiliates.
6.4 Obligations to Province of Nova Scotia. Shareholders shall be jointly
and severally liable for all obligations of Dominion to the Province of Nova
Scotia. Within three (3) years after the Closing Shareholders shall provide
evidence reasonably satisfactory to Dominion and Immucor/Canada that such
obligations have been satisfied, or that the Province of Nova Scotia has
released Dominion and its affiliates from such obligations. If such
evidence has not been so provided to Dominion and Immucor/Canada within
three (3) years after the Closing, Immucor/Canada may withhold the amount of
such obligations owing to the Province of Nova Scotia from any payment under
the Notes until such evidence is so provided. After the Closing Dominion
shall have no obligation to the Shareholders or the Province of Nova Scotia
with respect to the Shareholders' obligations, if any, to the Province of
Nova Scotia.
6.5 Expenses. Whether or not the expenses are incurred before or after the
Closing, each of the expenses incurred by Immucor/Canada, Dominion and
Shareholders in connection with the authorization, preparation, execution
and performance of this Agreement, including without limitation all fees,
commissions, and expenses of agents, representatives, counsel, accountants,
brokers and finders, shall be paid by the party that incurred such expenses.
Without limiting the generality of the foregoing, Shareholders shall be
responsible for the payment of: any fees, commissions or expenses of any
broker or finder engaged by Dominion or Shareholders; and any expenses of
Dominion that exceed US$20,000.00. Dominion shall pay the first US$20,000.00
of any expenses incurred by Dominion or the Shareholders in connection
with the authorization, preparation, execution and performance of this
Agreement.
6.6 Tax Matters.
(a) Shareholders shall pay all Taxes applicable to the Shareholders that
relate to the sale of the Shares to Immucor/Canada and the other transactions
contemplated by this Agreement. At Closing, Mr. Brushett shall deliver to
Immucor/Canada a certificate of compliance issued by Revenue Canada related
to the disposition of taxable property stating that there are no necessary
withholdings with regard to Nubio's receipt of its portion of the Purchase
Price.
(b) Immucor/Canada and Dominion shall file and control any returns required
to be filed by Dominion after the Closing Date.
(c) Shareholders, on the one hand, and Immucor/Canada, on the other hand,
agree to give prompt notice to each other of any proposed adjustment to Taxes
for any periods during some or all of which the Shareholders owned the Shares.
Shareholders and Immucor/Canada shall cooperate with each other in the
conduct of any Tax audit or other proceedings involving Dominion for such
periods. In connection with any such audit or other proceeding, Immucor/
Canada, upon the Shareholders' request and at their expense, shall provide
the Shareholders copies of all notices, correspondence, demands, assessments
and other documents generated in connection with such audit or other
proceeding, all of which information shall remain subject to Section 6.10
below. The Shareholders shall also have the right to discuss the status of
such audit or other proceeding with Immucor/Canada's representatives and,
with the prior written consent of Immucor/Canada (not to be unreasonably
withheld), with the applicable taxing authorities involved. All of such
activities by the Shareholders shall be conducted in a manner so as not to
adversely impact the best interests of Dominion.
(d) Shareholders on the one hand, and Immucor/Canada, on the other hand,
agree to furnish or cause to be furnished to each other, upon request, as
promptly as practicable, such information and assistance (including access
to books and records) relating to Dominion as is reasonably necessary for
the preparation of any return, claim for refund or audit, and the prosecution
or defense of any claim, suit or proceeding relating to any proposed
adjustment.
6.7 Survival of Warranties. The Warranties will not merge, but will survive
the Closing as follows:
(a) the Warranties contained in Sections 3.3 and 3.5 hereof will survive the
Closing indefinitely;
(b) the Warranties contained in the following Sections or subsections hereof
will survive the Closing for a period of three (3) years after the Closing Date:
4.3, 4.4. 4.5, 4.9(b), 4.9(c), 4.9(g), 4.9(h), 4.10, 4.11, 4.14(d)(2),
4.14(d)(4), 4.15, 4.18(a), 4.18(b), 4.18(c), 4.18(e), 4.19(j), 4.22(a),
4.22(b), 4.22(c), 4.22(d), 4.22(f), 4.22(g), 4.22(i), 4.22(j), 4.22(k),
4.22(l), 4.22(m), 4.22(n), 4.22(p), and 4.22(q);
(c) the Warranties contained in the following Sections or subsections hereof
will survive the Closing for a period of three (3) years after the date of the
notice of assessment for Dominion's income tax return for 1996:
3.6, 3.7, 4.6, 4.19(a), 4.19(c) and 4.19(f);
(d) all Warranties not identified in subsections 6.7(a), 6.7(b) or 6.7(c)
above shall survive the Closing for a period of one (1) year after the
Closing Date.
6.8 Indemnification by Shareholders.
(a) By the Shareholders. Subject to Subsections 6.8(b) and 6.8(d) below,
Shareholders shall indemnify, reimburse and hold harmless Dominion, Immucor/
Canada, Immucor/US and their affiliates and any successor or assigns (the
"Indemnified Persons") for any and all claims, losses, liabilities damages
(including special and consequential damages, subject to a duty of the
Indemnified Persons to mitigate such consequential damages), costs (including
court costs) and expenses (including all reasonable attorneys' and
accountants' fees and expenses actually incurred) net of any insurance
proceeds received (hereinafter "a Loss" or "Losses"), as a result of or in
connection with (i) any breach, inaccuracy or untruth of any Warranty; or
(ii) any breach of or noncompliance by any Shareholder with any covenant or
agreement of any Shareholder contained in this Agreement or in any other
agreement or instrument delivered in connection with this Agreement; or
(iii) any expenses of Dominion related to the transactions described herein
that exceed US$20,000.00.
(b) Limitations. (i) Shareholders shall not be required to indemnify an
Indemnified Person with respect to any Loss unless the Loss, when aggregated
with all other Losses of all Indemnified Persons, exceeds CDN$30,000 (the
"Minimum Aggregate Liability Amount"), at which time Losses may be asserted
for any amounts in excess of the Minimum Aggregate Liability Amount;
provided, that this limitation shall not apply to any Loss: (A) which
results from or arises out of fraud or intentional misrepresentation or an
intentional breach of warranty on the part of any Shareholder or (B) claimed
under Section 6.8(a)(iii). For any Loss or Losses not subject to the Minimum
Aggregate Liability Amount, the Indemnified Persons shall be entitled to
indemnification regardless of the minimum amount of the Loss. Any claim by
an Indemnified Person under Sections 6.8(a)(i) must be brought within the
survival period specified in Section 6.7 for the Warranty to which such
claim is related; all other claims must be brought within 2 years after the
Closing Date.
(ii) In no event shall: (A) the liability of any Shareholder for any Loss
exceed one-third (1/3) of the Loss, except as provided in Subpart 6.8(b)(iii);
and (B) in no event shall the aggregate liability of Shareholders for all
Losses exceed CDN$6,870,000.00.
(iii) If there is a breach of a Warranty made by or as to a particular
Shareholder (as opposed to, by or as to all Shareholders collectively) in
Sections 3.3, 3.6, 3.7 and 4.6(c) hereof (an "Individual Warranty"), or if
there is a breach of a covenant or agreement of a Shareholder, only the
Shareholder breaching such Individual Warranty, covenant or agreement shall
be responsible for the Loss arising from such breach, and the non-breaching
Shareholders shall not have any liability for the Loss arising from such
breach. The Shareholder(s) breaching such Individual Warranty, covenant, or
agreement shall be liable for the full amount of any Loss arising therefrom.
(c) Notification. Samuel Brushett or another Shareholder designated by him
(the "Shareholders' Representative") hereby undertakes to notify Immucor/
Canada without delay of the occurrence of any event of which such
Shareholders' Representative has knowledge which constitutes or may with the
passage of time constitute an event entitling any Indemnified Person
to indemnification under this Section.
(d) Notice of Claim. To seek indemnification hereunder, an Indemnified
Person shall notify the Shareholders' Representative of any claim for
indemnification, specifying in reasonable detail the nature of the Loss and
the amount or an estimate of the amount thereof.
(e) No Prejudice. Nothing herein shall prevent an Indemnified Person from
making a claim for a Loss hereunder notwithstanding its knowledge of the Loss
or possibility of the Loss on or prior to the Closing Date unless the Loss or
possibility of the Loss is disclosed in this Agreement or in the Disclosure
Memorandum.
(f) Other Rights. The indemnities granted hereunder are in addition to and
not in substitution for any other right or remedy an Indemnified Person may
now have or may subsequently take or hold, and may be enforced without first
recourse to such other right or remedy and without taking any steps or
proceedings in connection therewith, and notwithstanding any rule of law or
equity or statutory provision to the contrary.
(g) Defense of Actions. Shareholders may elect to compromise or contest, at
their own expense and with counsel reasonably acceptable to the Indemnified
Persons, any Loss. If Shareholders elect to compromise or contest such Loss,
they shall within 30 days after notice of the claim (or sooner, if the nature
of the Loss so requires) notify the Indemnified Person of their intent to do
so by sending a notice to the Indemnified Persons (the "Contest Notice"), and
the Indemnified Persons shall cooperate, at the expense of the Shareholders,
in the compromise or contest of such Loss. If the Shareholders elect not to
compromise or contest the Loss, fail to notify the Indemnified Persons of
their election as herein provided or contest their obligation to indemnify
under this Agreement, the Indemnified Persons (upon further notice to the
Shareholders) shall have the right to pay, compromise or contest such Loss
on behalf of and for the account and risk of the Shareholders. Anything in
this Section 6.8 to the contrary notwithstanding, (i) the Indemnified Persons
shall have the right, at their own cost and for their own account, to
compromise or contest any Loss, and (ii) Shareholders shall not, without the
Indemnified Persons' written consent, settle or compromise any Loss or
consent to entry of any judgment which does not include an unconditional
term releasing the Indemnified Persons from all liability in respect of such
Loss. In any event, the Indemnified Persons and the Shareholders may
participate, at their own expense, in the contest of such Loss. Shareholders,
at their own expense, shall have the right to defend any action that could
result in liability under this Section 6.8.
6.9 Indemnification by Immucor/Canada and Immucor/US.
(a) By Immucor/Canada and Immucor/US. Subject to Subsection 6.9(c)
below, Immucor/Canada and Immucor/US (collectively, "Immucor") shall jointly
and severally indemnify, reimburse and hold harmless the Shareholders for any
and all claims, losses, liabilities, damages, costs (including court costs)
and expenses (including all reasonable attorneys' and accountants' fees and
expenses actually incurred) net of any insurance proceeds received
(hereinafter "a Shareholder Loss" or "Shareholder Losses"), as a result of or
in connection with any breach, inaccuracy or untruth of any warranty by
Immucor or any breach of or noncompliance by Immucor with any contract or
agreement of Immucor contained in this Agreement or, in any other agreement
or instrument delivered in connection with this Agreement.
(b) Limitations. Immucor shall not be required to indemnify a Shareholder
with respect to any Shareholder Loss, unless the Shareholder Loss, when
aggregated with all other Shareholder Losses, exceeds CDN$30,000.00 (the
"Shareholder Minimum Aggregate Liability Amount"), at which time Shareholder
Losses may be asserted for any amounts in excess of the Shareholder Minimum
Aggregate Liability Amount. This limitation shall not apply to any
Shareholder Losses which results from or arises out of fraud or international
misrepresentation or an intentional breach of warranty by Immucor. Any
claim brought by a Shareholder must be brought within a period of the
shorter of two (2) years after the Closing Date or the date on which the
Notes are fully paid and the warrants are fully exercised. In no event
shall Immucor's liability to the Shareholders, in the aggregate, exceed
CDN$11,482,000.00 less the cash paid at Closing.
(c) Notice of Claim. To seek indemnification hereunder, the Shareholders'
Representative shall notify Immucor of any claim for indemnification,
specifying in reasonable detail the nature of the Shareholder Loss and the
amount or an estimate thereof.
(d) No Prejudice. Nothing herein shall prevent a Shareholder from making a
claim for a Shareholder Loss hereunder notwithstanding its knowledge of the
Shareholder Loss or possibility of the Shareholder Loss on or prior to the
Closing Date.
(e) Other Rights. The indemnities granted hereunder are in addition to and
not in substitution for any other right or remedy a Shareholder may now have
or may subsequently take or hold, and may be enforced without first recourse
to such other right or remedy and without taking steps or proceedings in
connection therewith, and notwithstanding any rule of law or equity or
statutory provision to the contrary.
(f) Defense of Actions. Immucor may elect to compromise or contest, at its
own expense and with counsel reasonably acceptable to the Shareholders, any
Shareholder Loss. If Immucor elects to compromise or contest such
Shareholder Loss, it shall within 30 days after notice of the claim
(or sooner, if the nature of the Loss so requires) notify the Shareholders
of its intent to do so by sending a notice to the Shareholders'
Representative (the "Contest Notice"), and the Shareholders shall cooperate,
at the expense of Immucor, in the compromise or contest of such Shareholder
Loss. If Immucor elects not to compromise or contest the Shareholder Loss,
fails to notify the Shareholders of its election as herein provided or
contests its obligation to indemnify under this Agreement, the Shareholders
(upon further notice to Immucor) shall have the right to pay, compromise or
contest such Shareholder Loss on behalf of and for the account and risk of
Immucor. Anything in this Section 6.9 to the contrary notwithstanding, (i)
the Shareholders shall have the right, at their own cost and for their own
account, to compromise or contest any Shareholder Loss, and (ii) Immucor
shall not, without the Shareholders written consent, settle or compromise
any Shareholder Loss or consent to entry of any judgment which does not
include an unconditional term releasing the Shareholders from all liability
in respect of such Shareholder Loss. In any event, the Shareholders and
Immucor may participate, at their own expense, in the contest of such
Shareholder Loss.
6.10 Confidentiality.
(a) Dominion and Shareholders shall hold in trust and confidence all
Confidential Information (as defined below) and shall not make any copies of,
distribute or use any Confidential Information except as necessary to prepare
for the completion of the transactions contemplated under this Agreement.
Upon the first request in writing from Immucor/Canada, Shareholders shall
return to Immucor/Canada all Confidential Information in their possession,
without retaining any copies thereof.
(b) As used in this Section 6.10:
(1) "Confidential Information" means all information relating to Dominion's
Business (current or future), Immucor's Business (current or future) any
affiliate of Immucor/Canada or Immucor/US, or any person or entity with
which either deals, which information is reasonably regarded as confidential,
being information not in the public domain; including, without limitation:
all Inventions (as defined below); technical data; research and development
information; business records, information and notes; products; "know-how";
Trade Secrets (as defined below); engineering or other data; designs,
specifications, processes and formulae; manufacturing or planning procedures,
techniques or information; marketing plans, strategies and forecasts;
business and product development plans, strategies and forecasts; financial
statements, budgets, prices, costs and financial projections; accounting
procedures or financial information; names and details of consumers,
customers, suppliers and agents; employee details; and secret information;
together with the possible or likely function, purpose or application of
that information whether in the current activities of Dominion,
Immucor/Canada, Immucor/US or any of their affiliates or fields to which
the activities of Dominion, Immucor/Canada, Immucor/US or any of their
affiliates may reasonably extend from time to time, any part of or
improvements to that information, and any recommendation, test or report of
Dominion, Immucor/Canada, Immucor/US or any of their affiliates or any
consultant or agent in connection with that information; and whether such
information is oral, written, recorded or stored by electronic, magnetic,
electromagnetic or other form or process or otherwise in a machine readable
form, translated from the original form, recompiled, made into a compilation,
wholly or partially copied, modified, updated or otherwise altered, or
originated or obtained by, or coming into the possession, custody, control
or knowledge of Dominion, Immucor/Canada, Immucor/US or any of their
affiliates either alone or jointly.
(2) "Invention" means any invention, drawing, design, model,
contrivance, structure, specification, improvement, discovery, creation,
idea, concept, formula, process and other work or contribution however
developed, created, made discovered or conceived, and whether or not
patented or patentable (whether by renewal or otherwise), protected by
copyright, or otherwise protected or capable of protection by law anywhere.
(3) "Trade Secrets" means any information of Dominion,
Immucor/Canada, Immucor/US or any of their affiliates (including but not
limited to technical or non-technical data, a formula, a pattern, a
compilation, a program, a device, a method, a technique, a drawing, a
process, financial data, financial plans, product plans, or a list of actual
or potential customers or suppliers) which (i) derives economic value, actual
or potential, from not being generally known to, and not being readily
ascertainable by proper means by, other persons who can obtain economic
value from its disclosure or use, and (ii) is the subject of
efforts that are reasonable under the circumstances to maintain its secrecy.
6.11 Noncompetition.
(a) The Shareholders acknowledge and recognize the highly competitive
nature of Dominion's Business and Immucor's Business and accordingly agree
that, to induce Immucor/Canada to consummate the transaction contemplated by
this Agreement and additionally, in the case of Mr. Brushett, in consideration
for the Noncompetition Payment, Mr. Brushett for a period of five (5) years
after the Closing Date and Messrs. Waddy and MacNeil for a period of two (2)
years after the Closing Date, shall not:
(1) Without Immucor/US's express prior written consent,
engage directly or indirectly in any Competitive Business (as defined below)
anywhere in the Restricted Territory (as defined below), whether such
engagement be as an employer, officer, director, owner, investor (except as a
passive investor with no more than a 5% interest), employee, partner,
consultant or other participant in any Competitive Business;
(2) Solicit or accept Competitive Business from anyone who is
or becomes an active or prospective customer of Dominion, Immucor/Canada,
Immucor/US or their affiliates after Closing or who was an active or
prospective customer of Dominion on or prior to the Closing Date:
(3) Solicit for employment or hire any employee of Dominion,
Immucor/Canada, Immucor/US, or their affiliates; or
(4) Attempt to do any of the things (or directly or indirectly
assist anyone else in doing or attempting to do any of the things) specified
in subsections (1), (2) or (3) above.
(b) As used in this Section 6.11:
(1) "Competitive Business" means and includes any business,
individual, corporation or other entity which is engaged wholly or partly in
any business substantially similar to Dominion's Business or Immucor's
Business; and
(2) "Restricted Territory" means the entire world as
Dominion's business is unique and is utilized throughout the world.
(c) The provisions of this Section 6.11 shall not apply to the activities of
Messrs. Waddy and MacNeil performed in the course of their employment with and
authorized by Dominion, Immucor/Canada or Immucor/US.
6.12 Funds Received After Closing. Any and all funds received by any
Shareholder (or anyone other than Immucor/Canada or Dominion) after Closing
in respect of Dominion's Business shall be remitted to Dominion immediately
upon receipt.
6.13 Transfer of Shares. Dominion recognizes that the transactions occurring
pursuant to this Agreement require Dominion to recognize the transfer of the
Shares from Shareholders to Immucor/Canada, and Dominion hereby recognizes
such transfer.
6.14 Maintaining Work Force. For a period of two (2) years after the Closing
Date, Immucor/Canada and Immucor/US shall use their reasonable best efforts to
maintain the number of employees at Dominion's facility in Dartmouth, Nova
Scotia at the same level as before the Closing, except for possible changes
in the direct sales force and for such other changes that may be made in the
exercise of reasonable business practices, including but not limited to dealing
with the impact of future acquisitions. The provisions of this Section 6.14
shall survive Closing for a period of two (2) years after the Closing Date.
ARTICLE VII
MISCELLANEOUS
7.1 Notices. Any notice or other communication required or permitted to be
given hereunder shall be in writing and shall be deemed to have been given
when delivered by personal delivery, by FAX or by mail, to the following
address:
To the Shareholders: Nubio Technologies Corporation
c/o Samuel Brushett
317 Village Drive
St. Augustine, Florida 32095-9063
FAX: (904) 829-3831
Patrick Waddy
Dominion Biologicals Limited
5 Isnor Drive
Dartmouth, Nova Scotia B3B 1M1
Canada
FAX: (902) 468-3599
Blaine MacNeil
Dominion Biologicals Limited
5 Isnor Drive
Dartmouth, Nova Scotia B3B 1M1
Canada
FAX: (902) 468-3599
with a copy in each
case to: Rowe, Foltz & Martin, P.C.
Suite 750
5 Piedmont Center
3525 Piedmont Road, N.E.
Atlanta, Georgia 30305
Attention: Paul Shlanta
FAX: (404) 237-1659
To Immucor/Canada or
Immucor/US: Immucor, Inc.
3130 Gateway Drive
P.O. Box 5625
Norcross, Georgia, USA 30091-5625
Attention: President
FAX: 770-242-8930
with a copy to: Nelson Mullins Riley & Scarborough, L.L.P.
400 Colony Square
Suite 2200
1201 Peachtree Street
Atlanta, Georgia 30361
Attention: Philip H. Moise and Randy A. Faigin
FAX: 404-817-6050
or at such other address or FAX number as the parties hereto shall have last
designated by notice to the other party. Any notice given by personal
delivery or mail shall be deemed to have been delivered on the date of
receipt of such delivery at such address; and any notice given by FAX shall
be deemed to have been delivered on the date of transmission if received
during business hours on a business day, or the next business day after
transmission if received after business hours on a business day or at any
time on a non-business day.
7.2 Parties Bound by Agreement; Successors and Assigns. The terms, conditions
and obligations of this Agreement shall inure to the benefit of and be binding
upon the parties hereto and the respective successors and permitted assigns
thereof. Without the prior written consent of Immucor/Canada, Shareholders
may not assign their rights, duties or obligations hereunder or any part
thereof to any other Person. Immucor/Canada may assign its rights and duties
hereunder in whole or in part to Immucor/US or other affiliates, including,
without limitation, after the Closing Date, Dominion. Shareholders hereby
acknowledge that Immucor/Canada, after the Closing Date, may merge into, or
amalgamate with, Dominion. Immucor/US shall not assign the Five Year Warrants,
the Ten Year Warrants or the Immucor Guaranties without the affected
Shareholders' prior written consent.
7.3 Entire Agreement. This Agreement, the Disclosure Memorandum and all
other certificates, schedules and other documents delivered pursuant thereto
constitute the entire agreement between the parties with respect to the
transactions contemplated hereby, and supersede and are in full substitution
of any and all prior agreements and understandings written or oral between
the parties relating to such transactions.
7.4 Descriptive Headings. The descriptive headings of the Sections of this
Agreement are inserted for convenience only and shall not control or affect
the meaning or construction of any of the provisions hereof.
7.5 Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be an original, but all of which together
shall constitute one instrument.
7.6 Amendments and Waivers. No modification, termination, extension, renewal
or waiver of any provision of this Agreement shall be binding upon a party
unless made in writing and signed by such party. A waiver on one occasion
shall not be construed as a waiver of any right on any future occasion. No
delay or omission by a party in exercising any of its rights hereunder shall
operate as a waiver of such rights.
7.7 Governing Law, Jurisdiction and Venue. This Agreement is executed by the
parties in, and shall be construed in accordance with and governed by the laws
of Georgia, USA, and jurisdiction and venue for any matter submitted to a court
hereunder or in connection with the transactions described herein shall lie in
any court of competent jurisdiction in Atlanta, Georgia, USA.
7.8 No Third-Party Beneficiaries. With the exception of the parties to this
Agreement and the Indemnified Parties, there shall exist no right of any
person to claim a beneficial interest in this Agreement or any rights
accruing by virtue of this Agreement.
7.9 Gender and Number. Where the context requires, the use of a pronoun of
one gender or the neuter is to be deemed to include a pronoun of the
appropriate gender, singular words are to be deemed to include the plural,
and vice versa.
7.10 Dispute Resolution.
(a) Negotiation. The parties hereto agree to attempt to resolve all disputes
arising out of or related to the subject matter of this Agreement by good faith
negotiations.
(b) Mediators. If the parties are unable to reach resolution after good
faith negotiations, the parties agree to submit their dispute(s) to mediation
with an independent mediator.
(c) Arbitration. If after such mediation the parties are unable to resolve
their disputes, the parties shall submit any claim or controversy to binding
arbitration in accordance with the Commercial Arbitration Rules of the
American Arbitration Association (the "AAA Rules"). The arbitration shall
be held before a panel of three arbitrators. The Shareholders collectively
shall select one arbitrator and Immucor/Canada shall select one arbitrator
within 10 business days after receiving identical lists provided by the
American Arbitration Association ("AAA"). If either the Shareholders or
Immucor/Canada fail to select an arbitrator within this time period, the
other party shall select such arbitrator. Within 15 days after the selection
of the last of two arbitrators, the two arbitrators shall select a third AAA
arbitrator. The arbitration shall be held within 30 days after the
appointment of the third arbitrator with the panel of arbitrators rendering
an award within 30 days after the hearing. Each party shall bear its own
costs of arbitration unless the panel of arbitrators provides otherwise.
The arbitration shall be conducted in Atlanta, Georgia. All arbitration
proceedings shall be in English. The award of the arbitrators shall be
final and binding. The parties waive any right to appeal the award, to the
extent a right to appeal may be lawfully waived. Each party retains the
right to seek judicial assistance: (i) to compel arbitration; (ii) to obtain
interim measures of protection pending arbitration; and (iii) to enforce any
decision of the arbitrators, including the final award. Judgment upon the
final award may be entered in any court of competent jurisdiction. In the
event of any inconsistency between this Section and the AAA Rules, this
Section shall control.
Each of the parties hereto has caused this Agreement to be duly executed on its
behalf as of the date indicated on the first page hereof.
DOMINION:
DOMINION BIOLOGICALS LIMITED
By: /s/Samuel Brushett______________
Samuel Brushett, Chairman
SHAREHOLDERS:
/s/Samuel Brushett______________________
Samuel Brushett, Individually
NUBIO TECHNOLOGIES, INC.
By: /s/ Samuel Brushett____________________________
Samuel Brushett, President
/s/ Patrick Waddy_________________________________
Patrick Waddy
/s/ Blaine MacNeil_________________________________
Blaine MacNeil
IMMUCOR/CANADA:
3000524 NOVA SCOTIA LIMITED
By: /s/ Edward L. Gallup____________________________
IMMUCOR/US:
IMMUCOR, INC.
By: /s/ Edward L. Gallup____________________________
