SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
----------------------------
FORM 8-K/A
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): MARCH 14, 1996
BOSTON SCIENTIFIC CORPORATION
(Exact name of registrant as specified in charter)
DELAWARE 1-11083 04-2695240
(State or other (Commission (IRS employer
jurisdiction of file number) identification no.)
incorporation)
One Boston Scientific Place, Natick, Massachusetts 01760-1537
(Address of principal executive offices) (Zip code)
Registrant's telephone number, including area code: (508) 650-8000
<PAGE>
The information provided in this Current Report on Form 8-K/A supplements
the information provided in the Current Report on Form 8-K of Boston
Scientific Corporation dated March 14, 1996 (the "Original 8-K") filed
with the Securities and Exchange Commission on March 29, 1996.
Except as otherwise noted herein, the content of such Original 8-K
shall remain unmodified.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits
Exhibits
Exhibit Number Description
*2.1 Purchase Agreement by and between Boston
Scientific Corporation and American Home
Products Corporation dated January 25, 1996.
* Confidential Treatment was requested and
subsequently withdrawn with respect to certain
sections of this exhibit. Filed herewith is an
unredacted version of this exhibit.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of
1934, the Registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
Date: June 17, 1996 By: /s/ Lawrence C. Best
---------------------------
Lawrence C. Best
Senior Vice President -
Finance and Administration
and Chief Financial Officer
PURCHASE AGREEMENT
by and between
AMERICAN HOME PRODUCTS CORPORATION
and
BOSTON SCIENTIFIC CORPORATION
PURCHASE AGREEMENT
This PURCHASE AGREEMENT dated as of January 25, 1996
(the "Agreement") by and between AMERICAN HOME PRODUCTS
CORPORATION, a Delaware corporation ("Seller"), and BOSTON
SCIENTIFIC CORPORATION, a Delaware corporation
("Buyer").
W I T N E S S E T H:
WHEREAS, Seller owns and has the legal right and authority to sell,
transfer, assign and deliver 860,001 shares (the "Shares") of voting stock,
$1.00 par value per share, of SYMBIOSIS CORP., a Florida corporation
(the "Company"), which shares constitute all of the issued and outstanding
shares of capital stock of the Company;
WHEREAS, Seller desires to sell the Shares to Buyer, and Buyer desires
to acquire the Shares, all on the terms and subject to the conditions
set forth herein;
NOW, THEREFORE, in consideration of the foregoing premises and the
representations, warranties, covenants and agreements herein contained,
the parties hereto, intending to be legally bound, agree as follows:
ARTICLE 1
DEFINITIONS
Whenever used in this Agreement, the terms defined below shall have
the indicated meanings:
1.1 "Affiliate" shall mean, with respect to any Person, any Person which
directly or indirectly through stock ownership or through other
arrangements either controls, or is controlled by or is under common
control with, such Person, provided, however, for purposes of this
Agreement the term "Affiliate" as it relates to Seller shall not include
Genetics Institute, Inc. or Immunex Corporation.
1.2 "Aggrieved Party" shall have the meaning set forth in Section
11.2(i).
1.3 "Applicable Laws" shall mean all laws, treaties, statutes, ordinances,
judgments, decrees, directives, rules, injunctions, writs, regulations,
binding arbitration rulings, orders, judicial or administrative
interpretations thereof, authorizations of any Governmental Authority,
and Applicable Permits relating to any of the foregoing, as may be in effect
from time to time.
1.4 "Applicable Permits" shall mean any waiver, exemption, variance,
permit, authorization, identification number, license or similar approval,
including, without limitation, product registrations by health or other
governmental entities, required to be obtained or maintained under
Applicable Laws in connection with the Company.
1.5 "Books and Records" shall mean the books and records of the Company.
1.6 "Closing" shall have the meaning set forth in Section 3.1.
17 "Closing Date" shall have the meaning set forth in Section 3.1.
1.8 "Code" shall mean the Internal Revenue Code of 1986, as amended.
1.9 "Competition Laws" shall mean all Applicable Laws that are designed
or intended to prohibit, restrict or regulate actions having the purpose or
effect of monopolization or restraint of trade.
1.10 "Contracts" shall mean all leases, rental agreements, insurance
policies, sales orders, licenses, agreements, employee plans, purchase
orders, instruments of indebtedness, guarantees and any and all other
binding contracts or arrangements (whether written or unwritten) of the
Company.
1.11 "Costs" shall have the meanings set forth in Section 11.1.
1.12 "Employees" shall mean (i) all individuals who, on the day
immediately prior to the Closing Date, are actively employed by the
Company, (ii) all individuals who are absent from active employment
on the Closing Date because of short-term disability leave, authorized
leave of absence from the Company or military service or lay-off with
recall rights as of such date and who offer to return to work pursuant
to such leave, military service or recall rights (individuals described
in clauses (i) and (ii) are herein referred to as "Active Employees"),
and (iii) all inactive or former employees of the Company, including
any individuals who have been on long-term disability leave or who
have terminated their employment, retired or died before the Closing
Date ("Former Employees").
1.13 "Encumbrances" shall mean all claims, security interests,
liens, pledges, charges, escrows, options, proxies, rights of first refusal,
preemptive rights, mortgages, hypothecations, prior assignments, title
retention agreements, indentures, security agreements or any other
priority rights or restrictions of any kind.
1.14 "Environmental Laws" shall mean all Applicable Laws relating to
the protection or pollution of the environment, natural resources, or the
use, handling, transportation, treatment, storage, disposal, release or
discharge of Hazardous Substances, including the Comprehensive
Environmental Response Compensation and Liability Act, as amended
(42 U.S.C. Section 9601 et seq.) ("CERCLA"), the Emergency
Planning and Community Right to Know Act of 1986, the Federal Solid Waste
Disposal Act, as amended by the Resource Conservation and Recovery Act
and the Hazardous and Solid Waste Amendments thereto, Materials
Transportation Act, the Clean Air Act, the Clean Water Act, the Toxic
Substances Control Act, the Safe Drinking Water Act, and any similar
or analogous statutes, regulations and decisional law of any Governmental
Authority, as each of the foregoing exist on the date hereof and on the
Closing Date, as the case may be.
1.15 "FDA" shall mean the United States Food and Drug Administration.
1.16 "Financial Statements" shall have the meaning set forth in Section
4.5(a).
1.17 "Former Shareholders" shall have the meaning set forth in
Section 6.1(c).
1.18 "GAAP" shall mean United States generally accepted accounting
principles.
1.19 "Governmental Authority" shall mean any United States or foreign
governmental department, commission, board, bureau, agency, court or other
instrumentality, or any jurisdiction, municipality or other political
subdivision thereof.
1.20 "HSR Act" shall have the meaning set forth in Section 7.6.
1.21 "Hazardous Substance" shall mean any hazardous substance as that
term is defined in CERCLA, but shall specifically include polychlorinated
biphenyls and radioactive materials, petroleum, including crude oil or any
fraction or constituent thereof, and natural gas in its various forms as
specified as excluded in CERCLA.
1.22 "Indemnifying Party" shall have the meaning set forth in Section
11.2(i).
1.23 "Intellectual Property" shall mean all (i) Patents, (ii) Know-how,
(iii) Trademarks and (iv) copyrights, copyright registrations and
applications for registration, inventions, designs, industrial and utility
models (including registrations and applications for registration thereof),
trade secrets and all other intellectual property rights whether registered
or not, in each case which are owned by the Company or which the Company
otherwise has the right to use.
1.24 "Know-how" shall mean all product specifications, processes, product
designs, plans, ideas, concepts, manufacturing, engineering and other
manuals and drawings, technical information, data, research records, all
promotional literature, customer and supplier lists and similar data and
information, and all other confidential or proprietary technical and
business information.
1.25 "knowledge" (including the term "to the knowledge of") shall mean,
with respect to Seller, the knowledge of any officer of Seller after due
inquiry and, when such term refers to knowledge relating to the Company or
its business, such knowledge as such officer or director should have obtained
after due inquiry of James Stitt, Richard DeLuca, J. William Box,
Gary Lopez and Sonia Jones, as appropriate. With respect to Section 4.11,
"knowledge" shall mean knowledge of Seller as defined above as well as after
due inquiry of in-house patent counsel to Seller and its Affiliates having
regular involvement in the Intellectual Property matters of the Company.
1.26 "Leased Real Property" shall mean all real property leased by the
Company, including any buildings, structures, fixtures and improvements
thereon, systems, equipment and items of personal property of the
Company attached or appurtenant thereto, and all easements, licenses,
rights and appurtenances relating to the foregoing.
1.27 "Material Adverse Effect" shall mean a material adverse effect
on the assets, business, operations or financial condition of the Company.
1.28 "Minimum Loss" shall have the meaning set forth in Section 11.3.
1.29 "Patents" shall mean all patents and patent applications (including,
without limitation, all reissues, divisions, continuations, continuations-
in-part, renewals and extensions of the foregoing).
1.30 "Permitted Encumbrances" shall have the meaning set forth in
Section 4.9(b).
1.31 "Person" shall mean an individual, a corporation, a partnership,
an association, a trust or other entity or organization, including a
government or political subdivision or an agency or instrumentality thereof.
1.32 "Promissory Note" shall have the meaning set forth in Section 3.2(a).
1.33 "Purchase Price" shall have the meaning set forth in Section 2.1.
1.34 "Reconciliation Statement" means that certain reconciliation
statement previously delivered by Seller to Buyer reflecting on a pro
forma basis the adjustments contemplated by this Agreement (assuming that
such adjustments had been made as of December 31, 1995) to the balance
sheet of the Unaudited Financial Statements and resulting in the pro forma
balance sheet previously delivered by Seller to Buyer, including adjustments
for (i) the dividend or advance of all the cash of the Company to Seller,
(ii) the dividend, forgiveness or settlement of all intercompany accounts
(including without limitation accounts with Sherwood Medical Company
("Sherwood") with respect to the Sherwood supply agreements set forth
on Schedule 4.10(i)), net of any amounts payable corresponding to any
such amounts receivable, (iii) the payment of all amounts due from
Buyer to Seller, net of any amounts payable corresponding to any
such amounts receivable and (iv) the assumption by Seller of certain
Tax liabilities of the Company in accordance with Section 7.7.
1.35 "Release" shall mean any release, spill, emission, leaking,
pumping, injection, deposit, disposal, discharge, dumping, dispersal,
leaching or migration of Hazardous Substances into the environment.
1.36 "Remedial Action" shall mean actions required by any applicable
Environmental Law or any Governmental Authority to (1) clean up, remove,
treat or in any other way address Hazardous Substances in the environment;
(2) prevent the Release or threat of Release or minimize the further
Release of Hazardous Substances; or (3) perform pre-remedial studies
and investigations and post-remedial care.
1.37 "Securities Act" shall mean the Securities Act of 1933, as amended.
1.38 "Shares" shall mean all of the issued and outstanding shares of all
classes of capital stock of the Company.
1.39 "Straddle Period" shall mean any taxable year or period
beginning before and ending after the Closing Date.
1.40 "Tax Affiliate" shall mean any Affiliate which was included,
or includable, in a Tax Return in which the Company was included as a
member.
1.41 "Tax Returns" shall mean all reports, returns, schedules and any
other documents required to be filed with respect to Taxes and all claims
for refunds of Taxes.
1.42 "Tax Sharing Arrangement" shall mean any written or
unwritten agreement or arrangement for the allocation or payment of
Tax Liabilities or payment for Tax benefits with respect to a
consolidated, combined or unitary Tax Return which Tax Return
includes the Company.
1.43 "Taxes" (and with correlative meanings, "Tax," "Taxes" and
"Taxable") shall mean any and all taxes, fees, levies, duties and tariffs
imposed by a federal, state, local or foreign Governmental Authority
or taxing authority, and any payments made to another party pursuant
to a Tax Sharing Arrangement, indemnity or other similar arrangement,
including but not limited to those on, or measured by or referred to as
income, gross receipts, financial operation, sales, use, ad valorem,
value added, transfer gains, franchise, profits, license, withholding,
payroll (including all contributions or premiums pursuant to industry
or governmental social security laws or pursuant to other tax laws and
regulations), employment, excise, severance, stamp, occupation, premium,
property, transfer or windfall profits taxes, customs duties, license
registration and documentation fees or similar fees, assessments or
charges together with any interest and any penalties, additions to
tax or additional amounts imposed by such Governmental Authority
or taxing authority with respect to such amounts.
1.44 "Trademarks" shall mean (i) trademarks, service marks,
trade names, trade dress, labels, logos, corporate names and all other
names and slogans associated with any products or embodying the
goodwill of the owner, whether or not registered, and any applications
or registrations therefor, and (ii) any associated goodwill incident thereto.
1.45 "Glossary of Defined Terms." Each of the following terms is
defined in the Section set forth opposite such term below.
Defined Term Location of Definition
Audited Financial Statements Section 4.5
Buyer Preamble
Company Recitals
Employment Contracts Section 9.1
ERISA Section 9.1
IRS Section 4.7
Names Section 7.8
Plans Section 9.1
Required Consent Section 4.19
Seller Preamble
Shares Recitals
Sherwood Section 1.32
Termination Breach Section 10.1(d)
Unaudited Financial Statements Section 4.5
ARTICLE 2
THE ACQUISITION
2.1 PURCHASE AND SALE. (a) Upon the terms and subject to the
conditions of this Agreement, Seller shall sell, assign, transfer and
deliver to Buyer the Shares, and Buyer shall purchase and accept the
Shares for a purchase price of One Hundred Fifty Two Million Nine
Hundred Sixty Eight Thousand Five Hundred Ninety Eight Dollars
($152,968,598.00), as adjusted pursuant to subsection (b) below
(the "Purchase Price"). The Purchase Price shall be payable as
provided in Section 3.2(a).
(b) The Purchase Price shall be adjusted to settle any amounts owed
(whether or not yet due) by the Company to Buyer and by Buyer to the
Company as of the Closing Date (after giving effect to amounts due
Buyer in respect of free goods), and in the case of amounts due from
Buyer to the Company net of corresponding amounts payable.
ARTICLE 3
CLOSING
3.1 THE CLOSING. Unless this Agreement shall have been terminated
in accordance with Section 10.1, on the terms and subject to the conditions
of this Agreement, the closing of the sale and purchase of the Shares
and the consummation of the other transactions contemplated hereby
(the "Closing") shall take place at the offices of American Home Products
Corporation, Five Giralda Farms, Madison, New Jersey 07940 on the
next succeeding business day on which the last to be fulfilled or waived
of the conditions set forth in Article 8 shall be fulfilled or waived in
accordance with this Agreement or at such other time, date or place as
the parties may mutually agree upon in writing (the "Closing Date").
At the Closing, the parties to this Agreement will exchange certificates
and other documents specified in this Agreement.
3.2 DELIVERIES BY BUYER. At the Closing, Buyer shall deliver, or cause
to be delivered, to Seller the following:
(a) At the option of Buyer (A)(i) $52,968,598.00, or such greater
or lesser sum as may be due pursuant to Section 2.1(b), in cash payable
by wire transfer in immediately available funds to a bank account of
Seller, (which account shall be designated by Seller no fewer than two
business days prior to the Closing Date), and (ii) a promissory note in
the principal amount of $100 million dollars and in the form attached
hereto as Exhibit A (the "Promissory Note") or (B) the Purchase Price
in cash payable in the manner described in clause (A)(i); provided that
Seller will not be obligated to accept the Promissory Note from Buyer
if (x) there shall exist on the Closing Date an Event of Default under the
Promissory Note (as defined therein) or an event or circumstances that,
with the giving of notice or lapse of time or both, would constitute such
an Event of Default, (y) based on any revisions after the date hereof to
the draft Disclosure Letter attached to the form of Promissory Note
attached hereto, Seller reasonably concludes that the business, assets,
operations or financial condition of Buyer and its subsidiaries taken
as a whole differs from Seller's reasonable understanding of such
business, assets, operations or financial condition on the date of
this Agreement where such differences are of such significance that
a reasonably prudent business person in the position of Seller would
not have agreed to accept the Promissory Note or (z) Buyer shall not
have delivered to Seller a certificate signed by a duly authorized
officer of Buyer to the effect that the representations and warranties
of Buyer contained in the Promissory Note are true and correct in
all material respects on the date of the Promissory Note.
(b) the certificate of an officer of Buyer and other documents required
to be delivered pursuant to Section 8.2;
(c) a certificate, signed by an authorized officer of Buyer,
certifying to (i) the due organization and good standing of Buyer,
(ii) the corporate resolutions of Buyer authorizing the transactions
contemplated by this Agreement (and attaching such resolutions),
and (iii) the incumbency of officers of Buyer executing this
Agreement and the other agreements, instruments or certificates
to be delivered upon the Closing;
(d) such other instruments and documents, in form and
substance reasonably acceptable to Seller, as may be necessary
to effect the Closing.
3.3 DELIVERIES BY SELLER. At the Closing, Seller shall deliver or
cause to be delivered to Buyer the following:
(a) a certificate(s) representing the Shares duly endorsed
for transfer to Buyer or accompanied by stock powers duly
executed in blank;
(b) the certificate of officers of Seller required to be delivered
pursuant to Section 8.3;
(c) a certificate, signed by an authorized officer of Seller,
certifying (i) the due organization and good standing of Seller,
(ii) the corporate resolutions of Seller authorizing the transactions
contemplated by this Agreement (and attaching such resolutions),
and (iii) the incumbency of officers of Seller executing this Agreement
and the other agreements, instruments or certificates delivered upon the
Closing;
(d) a good standing certificate for the Company from the Secretary
of State of the State of Florida dated as of a date not earlier than 10
business days prior to the Closing Date;
(e) a copy of (i) the Certificate of Incorporation, as amended,
of the Company, certified by the Secretary of State of the State of
Florida, not earlier than 10 business days prior to the Closing Date
and accompanied by a certificate of the Secretary or Assistant Secretary
of the Company, dated as of the Closing Date, stating that no amendments
have been made to such Certificate of Incorporation since such date,
and (ii) the By-laws of the Company, certified by the Secretary or Assistant
Secretary of the Company;
(f) the stock books, stock ledgers, minute books, corporate seals
and financial records and statements of the Company;
(g) such instruments of cancellation and other appropriate documents,
in form and substance reasonably acceptable to Buyer, canceling all loans
or other obligations for borrowed money owed by the Company to Seller
or any of its Affiliates, duly executed by Seller or such Affiliates, as
the case may be;
(h) such other instruments and documents, in form and substance
reasonably acceptable to Buyer and Seller, as may be necessary to
effect the Closing;
(i) letters of resignation as a director of the Company signed
by each of the directors of the Company.
3.4 FURTHER ASSURANCES. From time to time, at Buyer's or Seller's
request and in accordance with Section 7.3, whether at or after the Closing
Date, Buyer or Seller, as the case may be, shall, and shall cause their
respective Affiliates to, execute and deliver such further instruments
of conveyance, transfer and assignment, cooperate and assist in providing
information for making and completing regulatory filings, and take
such other actions as Buyer or Seller, as the case may be, may reasonably
require of the other party to more effectively assign, convey and transfer
to Buyer the Shares as contemplated by this Agreement.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller hereby represents and warrants to Buyer as follows:
4.1 ORGANIZATION, GOOD STANDING, POWER, ETC.
(a) The Company is a corporation duly organized, validly existing and in
good standing under the laws of Florida. The Company has the requisite
corporate power and authority to own, operate or lease the properties
that it purports to own, operate or lease and to carry on its business as it
is now being conducted and is duly licensed or qualified as a foreign
corporation in each domestic or foreign jurisdiction in which the nature
of the business conducted by it or the character or location of the
properties owned or leased by it makes such licensing or qualification
necessary, except where the failure to be so licensed or qualified has
not had or would not be reasonably expected to have, individually
or in the aggregate, a Material Adverse Effect. Florida is the only
state where the Company is licensed or qualified to carry on its business.
Copies of (i) the Articles of Incorporation and by-laws of the Company,
including all amendments thereto and (ii) the stock transfer books of the
Company, heretofore delivered, furnished or made available to Buyer
or its representatives by Seller, are true and complete as of the date
hereof. Copies of the minute books of the Company, heretofore
delivered, furnished or made available to Buyer or its representatives
by Seller, are true and correct as of the date hereof in all material
respects and contain accurate records of all material actions taken
by the stockholders, Board of Directors and all committees of the
Board of Directors of the Company. Each of such Articles of Incorporation
and by-laws is in full force and effect, and the Company is not in
violation or breach of any of the provisions of its Articles of
Incorporation or by-laws.
(b) The Seller is a corporation duly organized, validly existing
and in good standing under the laws of Delaware. The Seller has the
requisite corporate power and authority to execute and deliver this
Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement by Seller and the
consummation by Seller of the transactions contemplated hereby
have been duly authorized by all necessary corporate action on the
part of Seller and no other corporate proceeding is necessary for
the execution and delivery of this Agreement by Seller, the performance
by Seller of its obligations hereunder and the consummation by Seller
of the transactions contemplated hereby. This Agreement has been
duly executed and delivered by Seller and constitutes a legal, valid
and binding obligation of Seller enforceable against Seller in accordance
with its terms, except as the same may be limited by bankruptcy,
insolvency, moratorium, reorganization or other laws of general
applicability relating to or affecting the enforcement of creditors' rights
and general principles of equity.
4.2 AUTHORIZED CAPITALIZATION OF THE COMPANY.
(a) As of the date of this Agreement, the authorized capital stock of the
Company consists of 1,000,000 shares, $1.00 par value per share, of
which 139,999 shares are designated as non-voting shares and 860,001
are designated as voting shares. As of the date hereof, there are (i) no
shares of non-voting stock issued or outstanding and (ii) 860,001
shares of voting stock issued and outstanding, all of which are
validly issued, fully paid and non-assessable. No shares of capital
stock are held in the treasury of the Company. There are no options,
warrants, convertible securities, or other rights, agreements,
arrangements or commitments of any character relating
to the capital stock of the Company or obligating Seller or the Company
to issue or sell any shares of capital stock of or other equity interests
in the Company, or any securities or obligations convertible into or
exchangeable for any shares of capital stock of the Company or other
equity interests in the Company obligating the Company to grant, extend,
or enter into any such right, agreement, arrangement or commitment.
(b) There are no outstanding contractual obligations of the Company
to repurchase, redeem or otherwise acquire any outstanding shares of capital
stock of, or other ownership interests in, the Company, or to provide
funds to or make any investment (in the form of a loan, capital
contribution or otherwise) in any other entity.
(c) The shares owned by Seller constitute all of the issued and
outstanding shares of capital stock of the Company. Seller is the holder
of record and beneficially of and has good, valid and marketable title
to all of the Shares to be sold hereunder, free and clear of any
Encumbrances and any preemptive or subscription rights of any
Person. There are no restrictions with respect to the transferability
of the Shares.
4.3 SUBSIDIARIES. The Company does not own directly or indirectly
any interest in any corporation or other legal entity or other interest
convertible or exchangeable into any equity or similar interest and the
Company is not a participant in any partnership or any joint venture
with any third party.
4.4 EFFECT OF AGREEMENT. The execution, delivery and performance
by Seller of this Agreement and the consummation by Seller of the
transactions contemplated hereby will not require any notice to, filing with,
or the consent, approval or authorization of (i) any Person or (ii)
any Governmental Authority, except as contemplated in Section
7.6 hereof or as set forth in Schedule 4.4, other than, in the case
of clause (i) above, where the failure to obtain such consent,
approval or authorization, or to give or make any such notice or
filing, would not be reasonably expected to have, individually or
in the aggregate, a Material Adverse Effect or to prevent or materially
delay the consummation of the transactions contemplated hereby or
in the case of clause (ii) above, where the failure to obtain such consent,
approval or authorization or to give or make any such notice or filing
would not be material to the Company or materially delay the consummation
of the transactions contemplated hereby. Except as contemplated in Section
7.6 hereof or as set forth in Schedule 4.4, neither the execution and
delivery of this Agreement nor the consummation of the transactions
contemplated hereby will (i) violate or result in a breach or result in
the acceleration or termination of, or the creation in any third party
of the right to accelerate, terminate, modify or cancel, or result in
the creation of any Encumbrance on any property or asset of the
Company pursuant to, any indenture or any material contract, lease,
sublease, loan agreement, note or other material obligation or liability
to which the Company is a party or is bound or to which any of the
Company's assets are subject, (ii) conflict with, violate or result in
a breach of any provision of the incorporation documents or by-laws
of the Seller or the Company, or (iii) conflict with or violate any
Applicable Laws in any material respect.
4.5 FINANCIAL STATEMENTS. (a) Seller has delivered to Buyer or
its representatives true and complete copies of (i) the special purpose
balance sheets of the Company as at December 31, 1994 and December 31,
1993 and the special purpose statements of operations, stockholders' equity
and cash flows for the year ended December 31, 1994 and the 13 month
period ended December 31, 1993, including all notes relating thereto,
which have been audited by and accompanied by the report of Arthur
Andersen & Co. (collectively, the "Audited Financial Statements"), and
(ii) the unaudited special purpose balance sheet of the Company as at
December 31, 1995, and statements of operations for the twelve months
then ended (collectively, the "Unaudited Financial Statements" and
together with the Audited Financial Statements, the "Financial Statements").
(b) The Audited Financial Statements (i) have been prepared from
the books and records of the Company, (ii) except as set forth
therein (including the notes thereto), have been prepared in
accordance with GAAP, consistently applied throughout the periods
involved; and (iii) fairly present both the financial condition of the
Company and its results of operations and cash flows as at the dates
and for the periods therein specified. The Unaudited Financial Statements
(i) have been prepared from the books and records of the Company, and
(ii) fairly present both the financial condition of the Company and its
results of operations and cash flows as at the dates and for the periods
therein specified.
(c) The Company does not have any indebtedness, obligation or
liability (whether accrued, absolute, contingent or otherwise) including
contingent liabilities for the performance of any obligation by any third
party, and whether or not of a nature required to be reflected on the
balance sheet of the Company, which is not shown or adequately
provided for in the balance sheet included in the Unaudited Financial
Statements or set forth in Schedule 4.5(c) except for (i) liabilities or
obligations not exceeding, individually or in the aggregate,
$100,000, and, that has not had and would not be reasonably
expected to have, individually or in the aggregate, a Material
Adverse Effect, or (ii) liabilities or obligations incurred in the ordinary
course of business since the date of the balance sheet included
in the Unaudited Financial Statements, consistent with past practice.
4.6 ABSENCE OF CERTAIN CHANGES OR EVENTS. Except (x) to the
extent arising out of or relating to the transactions contemplated by this
Agreement (including a dividend or advance of all cash of the Company
to Seller, the dividend, forgiveness or settlement of all intercompany
accounts (including without limitation accounts with Sherwood with
respect to the Sherwood supply agreements set forth on Schedule 4.10(i)),
net of any amounts payable corresponding to any such amounts receivable
and the payment of all amounts due from Buyer to Seller net of any
amounts payable corresponding to any such amounts receivable, all in a
manner consistent with the Reconciliation Statement), (y) for the
Contracts entered into since December 31, 1995 that are listed on
Schedule 4.10(i), or (z) for matters listed on Schedule 4.6, since
the date of the balance sheet included in the Unaudited Financial
Statements (i) the Company has operated and has paid all accounts
payable in the ordinary course of business in a manner consistent
with past practice, (ii) there has not been any change in or effect
on the Company that has had, or would be reasonably expected
to have, individually or in the aggregate, a Material Adverse Effect,
(iii) there has not been any change by the Company in its accounting
methods, principles or practices, except as required by a change in
GAAP, (iv) there has not been any revaluation by the Company of
any material asset (including, without limitation, any writing down
of the value of inventory or writing off of notes or accounts receivable),
other than in the ordinary course of business consistent with past
practice, (v) there has not been any entry by the Company into any
commitment or transaction material to the Company, (vi) there has
not been any redemption, purchase or other acquisition of any of
the Company's securities, and (vii) there has not been any increase
in or establishment of any bonus, insurance, severance, deferred
compensation, pension, retirement, profit sharing, stock option
(including, without limitation, the granting of stock options, stock
appreciation rights, performance awards or restricted stock awards),
stock purchase or other employee benefit plan, or any other increase
in the compensation payable or to become payable to any employees
or officers of the Company, except in accordance with agreements
in effect on the date hereof (true and complete copies of which have
been furnished to Buyer) or in the ordinary course of business
consistent with past practice.
4.7 TAXES. (a) Except as disclosed on Schedule 4.7(a), (i) and
except where failure to file has not had or would not be reasonably
expected to have, individually or in the aggregate, a Material Adverse
Effect, the Company has timely filed on or before the date hereof
(or will timely file) all Tax Returns required to be filed for tax years
or periods ending on or before the Closing Date; (ii) and except
where failure to pay has not had or would not be reasonably expected
to have, individually or in the aggregate, a Material Adverse Effect,
all such Tax Returns are (or will be) complete and accurate and disclose
all Taxes required to be paid by the Company for the periods covered
thereby and all Taxes shown to be due on such Tax Returns have been
(or will be) timely paid; (iii) except where failure to pay has not had
or would not be reasonably expected to have, individually or in the
aggregate, a Material Adverse Effect, all Taxes (whether or not
shown on any Tax Return) owed by the Company and required
to be paid with respect to tax years or periods ending on or before
the Closing Date have been (or will be) timely paid or are being
presently contested in good faith; (iv) none of the Company or any
of its Tax Affiliates has waived or been requested to waive any
statute of limitations in respect of Taxes; (v) the Tax Returns
referred to in clause (i) have been examined by the Internal
Revenue Service (the "IRS") or the appropriate state, local or
foreign taxing authority or the period for assessment of the Taxes
in respect of which such Tax Returns were required to be filed has
expired; (vi) there is no action, suit, investigation, audit, claim or
assessment pending or proposed or threatened with respect to Taxes
of the Company; (vii) all deficiencies asserted or assessments made
as a result of any examination of the Tax Returns referred to in clause
(i) have been paid in full; (viii) all Tax Sharing Arrangements and
Tax indemnity arrangements will terminate on or prior to the Closing
Date and the Company will have no liability thereunder on or after
the Closing Date; (ix) there are no liens for Taxes upon the assets
of the Company except liens relating to current Taxes not yet due;
(x) no intercompany obligation (as described in Prop. Treas. Reg.
Section 1.1502-13(g)) of the Company and any other Tax Affiliate will
remain outstanding following the Closing; and (xi) the Company
has no corporate acquisition indebtedness, as described in Section
279(b) of the Code.
(b) No transaction contemplated by this Agreement is subject to
withholding under Section 1445 of the Code.
(c) The Company has and will have no net operating loss or net
capital loss carryovers from years ending on or prior to the Closing Date.
4.8 REAL PROPERTY. (a) The Company does not own any real property.
Schedule 4.8(a) contains a complete and accurate list of all Leased Real
Property, including subleases, tenancies, licenses, contracts or other
agreements to which the Company is a party and Seller has delivered
or caused to be delivered to Buyer or its representatives true and correct
copies of all the leases of Leased Real Property and any and all material
ancillary documents pertaining thereto (including, but not limited to, all
amendments, consents for alterations and documents recording variations
and evidence of commencement dates and expiration dates). Schedule
4.8(a) sets forth a brief description of each such lease or similar agreement.
(b) The Company has a valid leasehold interest in all Leased Real
Property and each of such leases as it may be amended or modified is
in full force and effect in accordance with its terms and there exists no
breach or default (or event which with or without giving notice or the
lapse of time or both would constitute a default) thereunder on the
part of the Company or, to the knowledge of Seller, any default by
the other party thereto, which would be reasonably likely to cause
or permit a termination thereof, an acceleration of payments thereunder
or has had or would be reasonably likely to have, individually or in
the aggregate, a Material Adverse Effect.
4.9 GOOD TITLE TO AND CONDITION OF ASSETS; CONDUCT OF BUSINESS
CONDUCT OF BUSINESS;. (a)Except as set forth in Schedule 4.9(a), the
assets of the Company constitute all the assets, properties and rights,
including books, records, agreements and Intellectual Property, necessary or
used to conduct the business of the Company in all material respects as
currently conducted.
(b) Except for Intellectual Property, as to which no representation or
warranty is made except as set forth in Section 4.11, the Company has
good title to, or a valid and binding leasehold interest in, the assets of
the Company free and clear of all Encumbrances, except (i) as set forth in
Schedule 4.9(b)(i), (ii) any Encumbrances specifically disclosed in the
Financial Statements, (iii) liens for Taxes, assessments and other
governmental charges not yet due and payable and which will be
paid or settled in the manner described in Section 7.6, (iv) immaterial
mechanics', workmen's, repairmen's, warehousemen's, carriers' or other
like liens arising or incurred in the ordinary course of business, and
equipment leases with third parties entered into in the ordinary course
of business, and (v) with respect to Leased Real Property, (A) easements,
quasi-easements, licenses, covenants, rights-of-way, and other
similar restrictions, including without limitation any other agreements,
conditions or restrictions, in each case, which are a matter of public
record, (B) any conditions that are shown by a current survey (which
has been made available for Buyer's review prior to the date hereof) or
physical inspection and (C) zoning, building and other similar restrictions
pursuant to Applicable Laws that in the case of (A), (B) and this
clause (C) do not materially adversely effect the value to or use by
the Company of such property and (vi) other Encumbrances of a type
not described in clauses (i) through (v) above which, individually or
in the aggregate, are not material and would not be required to be
disclosed or reflected on a balance sheet of the Company prepared
in accordance with GAAP (all items included in (i) through (vi) are
referred to collectively herein as the "Permitted Encumbrances").
(c) The physical assets of the Company taken as a whole are in good
and serviceable condition (subject to normal wear and tear and immaterial
impairments of value and damage) and are generally suitable for the uses
for which they are intended.
4.10 CONTRACTS. Schedule 4.10(i) sets forth a list, as of the date
hereof, of each Contract other than (a) purchase orders in the usual and
ordinary course of business and (b) any Contract involving the annual payment
of less than $100,000 or terminable by the Company without penalty
upon not more than 30 days' notice. Except as set forth in Schedule
4.10(ii), each Contract listed in Schedule 4.10(i) or Schedule 4.11(a)
is a legal, valid and binding agreement and is in full force and effect.
Except as otherwise provided in Schedule 4.10(iii), (x) the Company
is not in material breach of any Contract listed on Schedule 4.10(i) and
(y) Seller has no knowledge of any material default by any other party
under any Contract listed in Schedule 4.10(i) which default has not been
cured or waived. Except as described on Schedule 4.10(iv), there is no
event or circumstance which, with the passage of time or the giving of
notice or both, would constitute a default or breach by the Company
under any of the Contracts listed on Schedule 4.10(i) that would not be
reasonably curable by the Company in the ordinary course of business
which breach or default would be reasonably expected to (A) have,
individually or in the aggregate, a Material Adverse Effect or (B)
result in the termination or acceleration of payment of the Contracts
listed on Schedule 4.10(v). To Seller's knowledge, there is no
assertion by any third party of any claim of material default or breach
under any of the Contracts except for such claim as would not be
reasonably expected to have, individually or in the aggregate, a Material
Adverse Effect.
4.11 INTELLECTUAL PROPERTY RIGHTS. (a) Schedule 4.11(a) sets forth a
listing of (i) all Patents, registered Trademarks and applications
therefor, registered copyrights and applications for copyright registration,
industrial and utility model registrations and applications therefor, and
design registrations and applications therefor, included in the Intellectual
Property, (ii) all Contracts under which the Company or any of its
Affiliates is licensed or otherwise uses or is permitted to use
Intellectual Property used in connection with any product of the
Company or which is necessary to conduct the business of the Company,
and (iii) all Contracts under which the Company or any of its Affiliates
licenses or otherwise permits any party to use Intellectual Property.
Except as set forth in Schedule 4.11(a)(iv), there are no pending, or,
to Seller's knowledge, threatened, interferences, reexaminations,
oppositions or nullities involving any patents, patent rights or
applications therefor of the Company. Except as disclosed in
Schedule 4.11(a)(v), there is no breach or violation by the Company
of, or, to the knowledge of Seller, loss of rights accruing to the
Company under, any license or other agreement pursuant to which
the Company has the right to use Intellectual Property. The Company
has taken reasonable measures to maintain the confidentiality of the
processes and formulas, research and development results and other
know-how of the Company. To the knowledge of Seller, except as
disclosed in Schedule 4.11(a)(vi), (x) the conduct of the business of
the Company as currently conducted and (y) the contemplated development,
manufacture, marketing and sale by the Company of currently contemplated
multibite biopsy forceps, guidewire and bipolar laparoscopy products do not
conflict in any way with any license, trademark, trademark right, trade
name, trade name right, patent, patent right, industrial model, invention,
service mark or copyright of any third party in a manner that has had or is
reasonably likely to have, individually or in the aggregate, a Material
Adverse Effect.
(b) To the knowledge of Seller (i) except as set forth in Schedule
4.11(b), no person has claimed that the conduct of the business of the
Company as currently conducted infringes on or otherwise violates the
Intellectual Property rights of any other Person and (ii) except as set forth
on Schedule 4.11(b), to the knowledge of Seller, no Person is challenging
or infringing or otherwise violating the Intellectual Property.
(c) Except as disclosed on Schedule 4.11(c), the Company either (i) owns
the entire right, title and interest in and to the Intellectual Property
free and clear of any Encumbrances; or (ii) has the royalty-free right to
use the same.
(d) Except as disclosed on Schedule 4.11(d), the Company is not in breach
of any material provision of any material agreement, commitment,
contractual understanding, license, sublicense, assignment or
indemnification which relates to any of the Intellectual Property and
has not taken any action with respect to the Intellectual Property which
had or would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect.
(e) All directors, officers, management employees, and technical and
professional employees of the Company are under written obligation to the
Company or Seller to maintain in confidence all confidential or proprietary
information acquired by them in the course of their employment and all
officers, management employees and technical and professional employees
of the Company are under written obligation to the Company to assign to
the Company all inventions made by them within the scope of their
employment during such employment and for a reasonable period thereafter.
4.12 LITIGATION AND CLAIMS. Except as set forth in Schedule 4.12, (a)
there is no civil, criminal or administrative action, suit, hearing,
arbitration, inquiry, proceeding or investigation pending or, to the
knowledge of Seller, threatened against the Company other than those
that have not had or would not be reasonably expected to have,
individually or in the aggregate, a Material Adverse Effect and
(b) the Company is not subject to any order, writ, judgment, award,
injunction, or decree of any court or Governmental Authority or any
arbitrator or arbitrators other than those that have not had or would not
be reasonably expected to have, individually or in the aggregate, a
Material Adverse Effect.
4.13 COMPLIANCE WITH LAW; APPLICABLE PERMITS APPLICABLE PERMITS;.
Except as set forth in Schedule 4.12 or Schedule 4.13 and except for
matters under Environmental Laws or relating to the environmental condition
of the Leased Real Property (as to which no representation or warranty is
made except as set forth in Section 4.14) the Company is in compliance
with all Applicable Laws, except where the failure to so comply has not had
or would not be reasonably expected to have, individually or in the
aggregate, a Material Adverse Effect. The Company has all Applicable
Permits necessary to own, operate or lease its properties and to conduct
its business as currently conducted, other than those the absence of which
has not had or would not be reasonably expected to have, individually or
in the aggregate, a Material Adverse Effect. There are no proceedings pending
or, to the knowledge of Seller, threatened which may result in the
revocation, cancellation or suspension of any such Applicable Permits,
except those the absence of which has not had or would not be reasonably
expected to have, individually or in the aggregate, a Material Adverse Effect.
4.14 ENVIRONMENTAL MATTERS. Except as disclosed on Schedule 4.14:
(a) The Company has obtained all environmental permits, licenses or
approvals required under any Environmental Laws necessary for its operation,
or as required by law other than those the absence of which has not had or
would not be reasonably expected to have, individually or in the aggregate,
a Material Adverse Effect, and has been and is in material compliance with
such permits and other requirements of applicable Environmental Laws
except where the failure to so comply has not had or would not be reasonably
expected to have, individually or in the aggregate, a Material Adverse
Effect;
(b) the Company has not received any written notice of and otherwise has
no knowledge of any claims by any Governmental Authority alleging a
material violation of any Environmental Laws;
(c) the Leased Real Property does not contain any underground storage
tanks, surface impoundments containing any Hazardous Substance,
PCB-containing materials or any exposed, friable asbestos-containing materials
the presence of which would reasonably be expected to result in aggregate
expenditures by the Company of amounts in excess of $500,000;
(d) the Company has not received any written notice, claim, or request
for information relating to any third party waste disposal site or former
property, alleging that it is or may be liable to any Person or Governmental
Authority as a result of a Release or threatened Release of any Hazardous
Substance by the Company, or generated by the Company; and
(e) there has been no Release, threatened Release, transportation,
treatment, handling or arrangement therefor of any Hazardous Substance that
would reasonably be expected to result in aggregate expenditures by the
Company of amounts in excess of $500,000.
4.15 FDA MATTERS. Except as set forth on Schedule 4.15, there are no
products being manufactured, assembled or sold by the Company which at
the date hereof would require any approval of the FDA or any other
Governmental Authority, whether federal, state, local or foreign, for the
purpose for which they are being manufactured, assembled or sold for
which such approval has not been obtained. All products now being
commercially distributed by the Company in any jurisdiction meet the
applicable legal requirements of such jurisdiction in all material respects
and all requisite governmental approvals have been duly obtained and
are in full force and effect. There is no action or proceeding by the FDA
or any other Governmental Authority, including, but not limited to,
recall procedures, pending or, to the knowledge of Seller, threatened
against the Company relating to safety or efficacy of any of its products.
Except as set forth in Schedule 4.15, since December 31, 1992, there
have been no written notices, citations or decisions by any Governmental
Authority that any product produced, manufactured or marketed at
any time by the Company, is defective or fails to meet any applicable
standards promulgated by any such Governmental Authority, and,
to the knowledge of Seller, no such defect or failure exists. Except
as set forth in Schedule 4.15, the Company has not received any
warning letter or Section 305 notices from the FDA and, to the
knowledge of Seller, there are no conditions which would be
reasonably likely to necessitate, in the event of an FDA enforcement
initiative, the cessation of any part of the Company's operations or the
suspension of marketing of any of the Company's products. Schedule
4.15 sets forth a list of all licenses, registrations, approvals, permits
and device listings relating to the products of the Company. Schedule
4.15 sets forth a brief description of all inspections by regulatory
authorities, recalls, product actions and audits of the Company
since December 31, 1992.
4.16 LABOR MATTERS. The Company is not a party to any collective
bargaining agreement or other labor union contract applicable to current
employees and there are no unfair labor practice proceedings pending
between the Company and any of its Employees. The Company has not
incurred any liability under, and has complied in all material respects
with, the Worker Adjustment Retraining Notification Act, and, to
Seller's knowledge, no fact or event exists that could give rise to
liability under such act.
4.17 INSURANCE. (a) All of the policies of insurance and bonds presently
in force with respect to the Company including, without limitation, fire,
workers compensation liability and other insurance, together with the
effective dates and expiration dates of such policies, the type (including
an indication of whether the coverage is on a claims made, occurrence or
other basis) and the amount of coverage, are listed in Schedule 4.17(a).
(b) With respect to each such insurance policy: (i) to the knowledge
of Seller, the policy is legal, valid, binding and enforceable in
accordance with its terms and, except for policies that have expired
under their terms in the ordinary course, is in full force and effect;
(ii) no party to the policy has repudiated in writing, or given notice
of an intent to repudiate, any provision thereof; and (iii) to the
knowledge of Seller, no insurer on the policy has been declared
insolvent or placed in receivership, conservatorship or liquidation.
4.18 BROKER'S FEES. Except as set forth on Schedule 4.18, Seller
or the Company have not employed any broker, finder or investment banker
or incurred any liability for any brokerage, finder's or other fee or
commission in connection with the transactions contemplated by this
Agreement. Except for the payments to be made to Societe Generale at
or prior to Closing pursuant to the Agreement dated as of January 23, 1996
between the Company and Societe Generale, as successor in interest to
Lodestar Securities, Inc., the Company is not and neither Buyer nor the
Company will be responsible for the fees or expenses of any broker, finder
or investment banker employed by the Company or any of its Affiliates
prior to the Closing Date.
4.19 REQUIRED CONSENTS. Except as contemplated by Section 7.6,
Schedule 4.19 describes each approval, authorization or consent required
in connection with the execution, delivery and performance of this
Agreement or the consummation of the transactions contemplated hereby
that if not received by the Closing Date would have had or would reasonably
be expected to have, individually or in the aggregate, a Material Adverse
Effect or delay the consummation of the transactions contemplated hereby
(each such consent, a "Required Consent").
4.20 NO OTHER REPRESENTATIONS OR WARRANTIES;. Except for the
representations and warranties of Seller expressly set forth in this
Agreement, neither Seller nor any other Person makes any other express
or implied representation or warranty on behalf of Seller, or otherwise
in respect of the Company.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
5.1 CORPORATE ORGANIZATION. Buyer is a corporation duly
organized, validly existing and in good standing under the laws of
Delaware. Buyer has the requisite corporate power and authority to
own, operate or lease the properties that it purports to own, operate or
lease and to carry on its business as it is now being conducted and is
duly licensed or qualified as a foreign corporation in each domestic
or foreign jurisdiction in which the nature of the business conducted
by it or the character or location of the properties owned or leased by it
makes such licensing or qualification necessary, except where the
failure to be so licensed or qualified would not be reasonably expected
to have a material adverse effect on the assets, business, operations or
financial condition of Buyer and its subsidiaries, taken as a whole.
5.2 AUTHORITY RELATIVE TO THIS AGREEMENT. Buyer has the requisite
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery
by Buyer of this Agreement and the consummation by Buyer of the
transactions contemplated hereby, have been duly authorized by all necessary
corporate action on the part of Buyer and no other corporate proceeding is
necessary for the execution and delivery of this Agreement by Buyer, the
performance by Buyer of its obligations hereunder and the consummation
by Buyer of the transactions contemplated hereby. This Agreement has been
duly executed and delivered by Buyer and constitutes a legal, valid and
binding obligation of Buyer, enforceable against Buyer in accordance
with its terms, except as the same may be limited by bankruptcy, insolvency,
moratorium, reorganization or other laws of general applicability relating to
or affecting the enforcement of creditor's rights and general principles of
equity.
5.3 BROKER'S FEES. None of Buyer or any of its Affiliates has employed
any broker, finder or investment banker or incurred any liability for any
brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement.
5.4 CONSENTS AND APPROVALS; NO VIOLATIONS NO VIOLATIONS;.
Except as contemplated by Section 7.6 hereof, no material filing with, and no
material permit, authorization, consent or approval of, any public body
or authority is necessary for the consummation by Buyer of the transactions
contemplated by this Agreement. Except as contemplated by Section 7.6 or
as would not prevent or materially delay the consummation of the transactions
contemplated hereby, the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will not (x) conflict
with or result in a breach of any of the provisions of the Certificate of
Incorporation or by-laws of Buyer, or (y) be subject to the making of any
filings with or the obtaining of any consents from any Governmental
Authority or any other Person (other than the receipt of a waiver from
The First National Bank of Boston (the "Bank Waiver"), contravene
in any material respect any Applicable Law or any order, writ, judgment,
injunction, decree, determination or award currently in effect that is
binding upon Buyer or any of its subsidiaries or any of their respective
properties.
5.5 SECURITIES ACT. Buyer is acquiring the Shares solely for the purpose
of investment and not with a view to, or for sale in connection with, any
distribution thereof in violation of the Securities Act. Buyer
acknowledges the Shares are not registered under the Securities Act or
any applicable state securities law, and that such Shares may not be
transferred or sold except pursuant to the registration provisions of the
Securities Act or pursuant to an applicable exemption therefrom and
pursuant to state securities laws and regulations as applicable.
5.6 FILINGS AND REPORTS.
(a) Buyer has made available to the Seller copies of all reports,
statements, and registration statements (including Forms 8-K, Annual Reports
on Form 10-K, and quarterly reports on Form 10-Q) required by law to be filed
by it with the Securities and Exchange Commission since January 1, 1993.
As of their respective filing dates, all such documents were prepared in
accordance with the requirements of the Securities Act or the Securities
Exchange Act of 1934, as the case may be, and did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading.
(b) The audited consolidated balance sheet of Buyer and its subsidiaries
as at December 31, 1994 (as restated to reflect the acquisition of SCIMED
Life Systems, Inc. accounted for as a pooling of interests), and the related
statements of income and stockholder equity of Buyer and its subsidiaries
for the fiscal year then ended, and the unaudited consolidated balance
sheet of Buyer and its subsidiaries as at September 30, 1995, and the
related consolidated statements of income and stockholder equity of
Buyer and its subsidiaries for the nine months then ended, copies of
which have been furnished to Seller, fairly present, subject, in the case
of said balance sheet as at September 30, and said statements of income
and stockholder equity for the nine months then ended, to year-end audit
adjustments and subject to the restatement of such financial statements
to reflect the treatment of the acquisitions of Meadox Medicals, Inc.,
Heart Technology, Inc. and EP Technologies, Inc. as poolings of interests,
the consolidated financial condition of Buyer and its subsidiaries as at
such dates and the consolidated results of the operations of Buyer and its
subsidiaries for the periods ended on such dates, all in accordance with
GAAP applied on a consistent basis, and since September 30, 1995,
there has been no material adverse change in such condition or operations
other than those that relate to combining and rationalizing the combined
businesses of Heart Technology, Inc., Meadox Medicals, Inc., and EP
Technologies, Inc.
5.7 NO OTHER REPRESENTATIONS OR WARRANTIES. Except for the
representations and warranties of Buyer expressly set forth in this
Agreement and the Promissory Note, neither Buyer nor any other
Person makes any other express or implied representation or warranty
on behalf of Buyer.
ARTICLE 6
CONDUCT OF BUSINESS PENDING THE CLOSING;
6.1 CONDUCT OF BUSINESS PENDING THE CLOSING. Except as disclosed
in Schedule 6.1, Seller and Buyer agree that, prior to the Closing, unless
Buyer shall otherwise consent in writing (which consent Buyer shall not
unreasonably withhold) or as otherwise expressly contemplated by this
Agreement:
(a) The business of the Company shall be conducted only in the ordinary
course of business and consistent with past practices. Without limiting the
generality of the foregoing, the Company will use its reasonable efforts to
preserve substantially intact its business organization, to keep available
the services of the current officers and key employees of the Company,
and to preserve the current relationships of the Company with customers
and suppliers;
(b) Seller shall cause the Company not to do any of the following:
(i) authorize for issuance, issue, sell, pledge, deliver, or agree or commit
to issue, sell, pledge or deliver (whether through the issuance or grant of
options, warrants, commitments, subscriptions, rights to purchase or
otherwise) any capital stock of the Company or securities or rights
convertible into or exchangeable for, shares of capital stock or securities
convertible into or exchangeable for such shares; (ii) pledge, dispose of
or encumber any of its assets other than in the ordinary course of business
and consistent with past practice; (iii) amend or propose to amend its
Articles of Incorporation or by-laws; (iv) split, combine or reclassify
any shares of its capital stock; (v) redeem, purchase or otherwise acquire
or offer to redeem, purchase or otherwise acquire any capital stock; or
(vi) authorize or propose any of the foregoing or enter into any contract,
agreement, commitment or arrangement to do any of the foregoing;
provided, however, that as of the Closing Date, Seller will (i) withdraw
cash from the Company, either in the form of dividends or as a cash
advance and may provide cash to the Company, either in the form of
a contribution to capital or as an intercompany loan; (ii) dividend,
forgive, and/or settle all intercompany accounts prior to Closing
(including without limitation accounts with Sherwood with
respect to the Sherwood supply agreements set forth on Schedule
4.10(i) net of amounts payable corresponding to such amounts
receivable); (iii) settle amounts owing from or to Buyer pursuant
to Section 2.1(b) prior to Closing and (iv) assume certain Tax liabilities
of the Company in accordance with Section 7.7. The adjustments
described in the proviso to this subparagraph (b) will be made in a
manner consistent with the adjustments set forth in the Reconciliation
Statement and Seller and the Company shall take no other actions to
reduce the assets or increase the liabilities of the Company other
than the foregoing or otherwise in the ordinary course of business.
(c) Seller shall cause the Company not to (i) acquire (by merger,
consolidation or acquisition of stock or assets) any corporation,
partnership or other business organization or division thereof or make
any investment either by purchase of stock or securities, contributions
to capital, property transfer or purchase of any amount of property
or assets of any other individual or entity; (ii) acquire any assets
for a value in excess of $100,000 or authorize or make any capital
expenditures that are in the aggregate in excess of $100,000 other
than pursuant to the current capital expenditure budget of the
Company (a true and complete copy of which has been furnished
to Buyer) and other than purchases in the ordinary course of business
consistent with past practice and except as contemplated by Section
11.1(a)(iv); (iii) dispose of any assets with a value in excess of
$100,000 other than sales of inventory in the ordinary course of
business consistent with past practice; (iv) enter into any
Contract which, had it been in existence on the date hereof,
would have been required to be listed in Schedule 4.10(i)
except that Seller may cause the Company to assume Seller's
obligations under the Royalty Agreement dated as of September 24, 1992
among Seller and each of the former shareholders of the Company
(the "Former Shareholders"), pursuant to the Assignment and
Accommodation Agreement dated January 25, 1996 among the Seller,
the Company and the Former Shareholders; (v) except for advances
to Employees for expenses in the ordinary course of business and
consistent with past practices, incur any indebtedness for borrowed
money or issue any debt securities or assume, guarantee, endorse
or otherwise as an accommodation become responsible for, the
obligations of any other Person, make any loans or advances or
enter into any other transaction, except the occurrence of
intercompany loans or the making of intercompany advances,
all of which will be repaid or canceled prior to Closing; (vi) authorize,
recommend or propose any change in its capitalization; or (vii) authorize or
propose any of the foregoing or enter into or modify any contract, agreement,
or commitment or arrangement with respect to any of the foregoing;
(d) Except as otherwise contemplated by this Agreement, Seller shall
not adopt or amend any Employee Plan or Benefit Arrangement (each as
hereinafter defined), or increase or pay any benefit not required by any
existing Employee Plan or Benefit Arrangement, or increase any salaries
or wages, or grant any bonus, severance or termination pay to, or enter
into any employment or severance agreement with, any director, officer or
other employee of the Company other than in the ordinary course of business
consistent with past practice or as may be required by a Governmental
Authority;
(e) The Company shall not waive, release, grant or transfer any of its
Intellectual Property or modify or change in any material respect any
existing material license, distribution agreement or lease; and
(f) The Company will make no Tax elections inconsistent with its
past practices and prior filings. Seller and the Company will consult in
good faith with Buyer to address Buyer's concerns regarding any new
elections due to tax law changes.
ARTICLE 7
ADDITIONAL AGREEMENTS
7.1 NO TRANSFER OF SHARES. Seller agrees that from the date
of this Agreement through the earlier of the Closing Date or the
termination of this Agreement, it shall not transfer, sell, hypothecate,
or otherwise assign any interest in the Shares.
7.2 EXPENSES. Except as otherwise provided in this Agreement,
all expenses, including the fees of any attorneys, accountants, finders,
investment, brokers, bankers or others engaged by a party, incurred in
connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such expenses whether
or not the transactions contemplated by this Agreement are consummated.
7.3 ADDITIONAL AGREEMENTS. Subject to the terms and conditions
herein provided, each of the parties hereto agrees (i) to use its
reasonable efforts to do, or cause to be done, all things necessary, proper
or advisable to consummate the transactions contemplated by this
Agreement and to cooperate with each other in connection with the
foregoing, (ii) to use its reasonable efforts to obtain all necessary
consents and approvals (or effective waiver thereof) from other parties
to material agreements, leases, contracts, instruments and other
contracts and to notify each of the other parties hereto of any request
for prepayment with respect thereto; provided, however, that if any
such consents and approvals are not obtained and the Closing occurs,
Seller shall cooperate with Buyer to provide to Buyer the benefits under
or with respect to the matter as to which the approval or consent is not
obtained, (iii) to defend all lawsuits or other legal proceedings
challenging this Agreement or the consummation of the transactions
contemplated hereby, (iv) subject to Section 7.6, to use its reasonable
efforts to lift or rescind any injunction or restraining order or other
order adversely affecting the ability of the parties to consummate the
transactions contemplated hereby, and (v) make all necessary filings
and submissions of information required or requested by Governmental
Authorities with respect to the transaction contemplated hereby.
7.4 ACCESS TO INFORMATION. Prior to the Closing,
Seller shall, and shall cause the Company to, (i) afford the officers,
employees, accountants, legal counsel and other representatives or
agents of Buyer reasonable access to the facilities, books, records
and employees of the Company during normal business hours and
in a manner that will not unreasonably disrupt the Company's operations
and (ii) furnish promptly such available information (without requiring
generation of such material) concerning the business, properties,
contracts, assets, liabilities, personnel and other aspects of the Company
as Buyer or its representatives may reasonably request. In connection
therewith, the parties will comply with the terms of the Confidentiality
Agreement dated November 15, 1994 between Buyer and Seller, which
agreement shall survive the termination of this Agreement but will
terminate on the Closing Date.
7.5 CONFIDENTIALITY. Seller agrees to, and shall cause
its employees, officers, directors, agents, representatives and Affiliates
to: (i) treat and hold as confidential (and not disclose or provide access
to any Person to) all confidential information to the extent related to the
business and operations of the Company (the "Information"), (ii) in the
event that Seller or any such employee, officer, director, agent,
representative or Affiliate becomes legally compelled to disclose
any of the Information, provide Buyer with prompt written notice of
such requirement or (iii) in the event that a protective order or other
remedy is not obtained, furnish only that portion of such Information
which is legally required to be provided and exercise its reasonable efforts
to obtain assurances that confidential treatment will be accorded the
Information, (iv) promptly furnish (prior to, at, or as soon as practicable
following, the Closing) to the Company or Buyer any and all copies
(in whatever form or medium) of all of the Information then in the
possession of Seller or any of its employees, officers, directors,
agents, representatives or Affiliates and (v) destroy any and all additional
copies then in the possession of Seller or any of its employees,
officers, directors, agents, representatives or Affiliates of the
Information and of any analyses, compilations, studies or other documents
prepared, in whole or in part, on the basis thereof; provided, however,
that the foregoing shall not apply to Information which becomes publicly
known other than through a breach of this Agreement by Seller, its agents,
employees, officers, directors, agents, representatives or Affiliates; or
(B) is subsequently disclosed to Seller by a third party who to Seller's
knowledge did not receive it under any obligation of confidentiality.
7.6 FILINGS AND AUTHORIZATIONS. Seller and Buyer will,
as promptly as practicable after the date of this Agreement, file or supply,
or cause to be filed or supplied, all notifications and information required
to be filed or supplied pursuant to the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act") and, if necessary,
any other Competition Laws, in connection with the transactions
contemplated by this Agreement. Seller and Buyer, as promptly as
practicable, (a) will make, or cause to be made, all such other filings
and submissions under any Applicable Law applicable to them, or to
their subsidiaries and Affiliates, as may be required for them to
consummate the transactions contemplated hereby in accordance
with the terms of this Agreement, (b) will use reasonable efforts to
obtain, or cause to be obtained, all authorizations, approvals, consents
and waivers from all Governmental Authorities necessary to be obtained
by them, or their subsidiaries or Affiliates, in order for them so to
consummate such transactions and (c) will cooperate fully with each
other in good faith in seeking all such authorizations, approvals, consents
and waivers. Notwithstanding anything to the contrary in this Section 7.6,
the parties hereto agree that, with respect to any action taken or threatened
to be taken by any court or Governmental Authority, Buyer shall not be
required to sell, license or otherwise dispose of, hold separate or
otherwise divest itself of any portion of the business or assets of the
Company, Buyer or any of Buyer's subsidiaries in order to consummate
the transactions contemplated hereby. Without limiting the generality
of their undertakings pursuant to this Section 7.6, each party hereto shall
(i) use its reasonable efforts to prevent the entry in a judicial or
administrative proceeding brought under any antitrust law by any
Governmental Authority with jurisdiction over enforcement of any
applicable Competition Law or any other party of any preliminary
injunction or other order that would make consummation of the purchase
of the Shares in accordance with the terms of this Agreement unlawful or
would prevent or delay it (including defending any litigation that could
result in the entry of such injunction or order); and (ii) take promptly, in
the event that such an injunction or order has been issued in such a
proceeding, all steps reasonably necessary to prosecute an appeal of
such injunction or order; provided, however, that neither Seller nor Buyer
shall be required to undertake more than one such appeal.
7.7 TAX MATTERS.
(a) Liability for Taxes. (i) Seller shall be liable for, and shall
indemnify Buyer against, all (A) Taxes imposed on any of Seller's Tax
Affiliates (other than the Company) for any taxable year or period, and
(B) Taxes imposed on the Company or for which the Company may
otherwise be liable for any taxable year or period that ends on or before
the Closing Date and, with respect to any Straddle Period, the portion of
such Straddle Period ending on and including the Closing Date (including,
without limitation, any obligation to contribute to the payment of a Tax
determined on a consolidated, combined or unitary basis with respect to
the Company and any of Seller's Tax Affiliates).
(ii) Buyer shall be liable for, and shall indemnify Seller against,
Taxes imposed on the Company or Buyer for any taxable year or period that
begins after the Closing Date and with respect to any Straddle Period, the
portion of such Straddle Period beginning after the Closing Date (including,
without limitation, any obligation to contribute to the payment of a Tax
determined on a consolidated, combined or unitary basis with respect
to Buyer and its Tax Affiliates).
(iii) For purposes of paragraphs (a)(i) and (a)(ii) above, whenever
it is necessary to determine the liability for Taxes of the Company for a
Straddle Period, the determination of the Taxes of the Company for the
portion of the Straddle Period ending on, and the portion of the Straddle
Period beginning after, the Closing Date shall be determined by assuming
that the Straddle Period consisted of two taxable years or periods, one
which ended at the close of business on the Closing Date and the other
which began at the beginning of the day following the Closing Date, and
items of the Company for the Straddle Period shall be allocated between
such two taxable years or periods on a "closing of the books basis" by
assuming that the books of the Company were closed at the close of
business on the Closing Date, provided, however, that (A) exemptions,
allowances or deductions that are calculated on an annual basis, such
as the deduction for depreciation, shall be apportioned between such
two taxable years or periods on a daily basis, and (B) items of income,
gain, deduction, loss or credit for the month in which the Closing
Date occurs shall be allocated between such two taxable years or periods
based on the calendar days in such month, except that extraordinary
items described in Treas. Reg. Section 1.1502-76(b)(2)(ii)(C) shall be
allocated to the day that they are taken into account.
(iv) For purposes of paragraphs (a)(i) and (a)(ii), where,
under applicable law, a taxable year or period ends as a result of the
purchase of the Shares pursuant to this Agreement, items of income,
gain, deduction, loss or credit shall be allocated between such taxable
year or period and the following taxable year or period in a manner
consistent with the rules in Treas. Reg. Section 1.1502-76(b).
(v) Buyer and Seller shall share equally any real property
transfer or gains Tax, sales Tax, use Tax, stamp Tax, stock transfer Tax,
or other similar Tax imposed on the transactions contemplated by this
Agreement, provided that any value added Tax shall be the obligation
of Buyer to the extent Buyer is entitled to claim credit for such value
added Tax.
(vi) Within five days after the date of this Agreement, Seller will
deliver or cause to be delivered to Buyer true and complete copies, of:
(A) all income Tax Returns of the Company filed for periods subsequent
to December 31, 1992 (or, with respect to consolidated, combined or
unitary returns, the portion thereof relating to the Company); (B) any
other Tax Returns for periods subsequent to December 31, 1992
reasonably requested by Buyer, as may be relevant to the Company or
the assets or operations thereof; and (C) any workpapers or other supporting
data reasonably requested by Buyer relating to current and deferred
income Taxes payable and receivable reflected in the books and
records of the Company as of December 31, 1994, and as of the
month ended just prior to the Closing Date relating to Tax Returns
made available pursuant to (A) or (B) or relating to Tax Returns
referred to in (A) or (B) not yet filed.
(b) Tax Returns. Seller shall file or cause to be filed when
due all Tax Returns that are required to be filed by or with respect to the
Company for taxable years or periods ending on or before the Closing
Date and Seller shall remit (or cause to be remitted) to the appropriate
Governmental Authority any Taxes due in respect of such Tax Returns,
and Buyer shall file or cause to be filed when due all Tax Returns that
are required to be filed by or with respect to the Company for taxable
years or periods ending after the Closing Date and Buyer shall remit
(or cause to be remitted) to the appropriate Governmental Authority
any Taxes due in respect of such Tax Returns. Seller or Buyer shall
reimburse the other party the Taxes for which Seller or Buyer is liable
pursuant to paragraph (a) of this Section 7.7 but which are payable
with any Tax Return to be filed by the other party pursuant to the
previous sentence upon written request of the party entitled to
reimbursement setting forth in detail the computation of the
amount owed by Seller or Buyer, as the case may be, but in no
event less than three business days prior to the due date for the
filing of such Tax Return. All Tax Returns which Seller is
required to file or cause to be filed in accordance with this paragraph
(b) shall be prepared and filed in a manner consistent with past
practice in preparing and filing similar Tax Returns and shall not
thereafter amend any Tax Return to take positions inconsistent
with such past practice.
(c) Contest Provisions. Buyer shall notify Seller in writing
upon receipt by Buyer, any of its Tax Affiliates, or the Company of notice
of any pending or threatened federal, state, local or foreign Tax audits or
assessments which may materially affect the Tax liabilities of the
Company for which Seller would be required to indemnify Buyer pursuant
to paragraph (a) of this Section 7.7. Seller shall have the sole right to
represent the Company's interests in any Tax audit or administrative
or court proceeding relating to taxable periods ending on or before
the Closing Date, and to employ counsel of its choice at its expense.
Seller shall consult with Buyer in good faith regarding the terms of
any proposed settlement. Seller shall take into consideration any concerns
expressed by Buyer during such consultations and make a good faith
effort to address Buyer's concerns in any such final settlement.
(d) Buyer and Seller agree to cooperate and share all required
information on a timely basis in order to timely file all Tax Returns and
for the preparation of any audit, and for the prosecution or defense of any
claim, suit or proceeding relating to any proposed adjustment. Buyer and
Seller agree to retain or cause to be retained all books and records
pertinent to the Company until the applicable period for assessment
under applicable law (giving effect to any and all extensions or waivers)
has expired, and to abide by or cause the abidance with all record
retention agreements entered into with any Governmental Authority.
After the Closing, Buyer will give Seller reasonable notice prior to
transferring, discarding or destroying any such books and records
relating to Tax matters and, if Seller so requests, Buyer will allow Seller
to take possession of such books and records. Buyer and Seller
shall cooperate with each other in the conduct of any audit or other
proceedings involving the Company for any Tax purpose and each
shall execute and deliver such powers of attorney and other documents
as are necessary and appropriate to carry out the intent of this subsection.
(e) Adjustment to Purchase Price. Any payment by Buyer
or Seller under this Section 7.7 will be an adjustment to the Purchase Price.
(f) Survival of Obligations. Notwithstanding anything to the contrary
in this Agreement, and notwithstanding Section 12.3 of this Agreement, the
obligations of the parties set forth in this Section 7.7 shall be
unconditional and absolute and shall remain in effect until the
expiration of the applicable statute of limitations.
7.8 USE OF CERTAIN NAMES. Within 90 days after the Closing
(or such time thereafter as Buyer may request if Seller furnishes its written
consent, which shall not unreasonably be withheld) Buyer shall cause
the Company to revise product literature and labeling (including stickering),
change packaging and stationery, and otherwise discontinue
use of the name "American Home Products" and any variation
thereof (collectively, "Names"). In no event shall Buyer or the
Company use any Names after the Closing in any manner or for
any purpose different from the use of such Names by the
Company during the 90 day period preceding the Closing.
With respect to product inventory manufactured by the
Company prior to the Closing, Buyer and the Company may
continue to sell such inventory, notwithstanding that it bears one
or more of the Names, for a reasonable time after the Closing
(not to exceed twelve months (or such time thereafter as Buyer
may request if Seller furnishes its written consent, which shall
not be unreasonably withheld)).
7.9 NO SOLICITATION. During the period between the date hereof
and the Closing, unless this Agreement is terminated by either party in
accordance with the provisions hereof, neither Seller nor the Company
nor any of their respective directors, officers, advisors, employees or
other representative or agents will, directly or indirectly, solicit any
offers, bids or indications of interest, or initiate, hold or continue
negotiations with any person, with respect to the assets, business
or capital stock of the Company, nor shall Seller or the Company
furnish, or authorize any agent or representative to furnish, any
information concerning the Company to any third party.
7.10 REPLACEMENT OF GUARANTY. Buyer agrees to use its reasonable
efforts to cause the guarantee by Seller (the "AHP Guarantee") set
forth in the Aggregation Agreement, dated as of February 1, 1994,
between the Company and Hemostatic Surgery Corporation to be
terminated and if required by Hemostatic replaced by a guarantee
by Buyer. Seller has no knowledge of any reason why Hemostatic
Surgery Corporation would not consent to such termination and
replacement other than with respect to the relative financial status
of the parties. In the event that the AHP Guarantee is not terminated
or replaced prior to the Closing Date, Buyer and the Company shall
deliver to Seller at the Closing a fully executed Power of Attorney
in the form attached as Exhibit B hereto (the "Power of Attorney").
In connection with the foregoing, in the event that Buyer becomes a
debtor under any chapter of the Bankruptcy Code, Chapter 11 U.S.C.
Section 101 et. seq., Buyer will, and will cause the Company to, provide
prompt notification to Seller in the event that the Company and Buyer
fail to pay when due any amounts due and owing by the Company
under such Aggregation Agreement or the license agreements referred
to therein.
7.11 CERTAIN PAYMENTS. The Company has been negotiating
a supply and license arrangement with Valleylab Inc., a Colorado
corporation ("Valleylab"), with respect to certain bipolar endoscopic
instruments, including scissors and graspers, which incorporate the
use of therapeutic bipolar energy through bipolar electrical connections
to end effectors ("Bipolar Agreement"). The current terms of the
negotiations reflect that following the effective date of an agreement,
Valleylab would pay the Company a non-refundable, lump-sum
fee of Two Million Five Hundred Thousand Dollars ($2,500,000.00)
in consideration of the exclusive rights and licenses contemplated to
be granted thereunder. The parties hereto agree that in the event that
a Bipolar Agreement is entered into between the Company or any
Affiliate and Valleylab or any Affiliate prior to December 31, 1996,
the Company and Seller shall each receive 50% of any lump sum
payment. Nothing in this Section 7.11 will obligate the Company
or any of its Affiliates to enter into any agreement with Valleylab
or require that any such agreement contain terms similar to those
that have been negotiated to date; provided, however, that in the
event a Bipolar Agreement is entered into following the Closing,
(i) Buyer shall use reasonable efforts to cause the Company to
obtain a lump-sum payment no less favorable than presently
provided, and (ii) the Company shall pay to Seller 50% of any
lump-sum amount received within 10 business days of receipt.
ARTICLE 8
CONDITIONS
8.1 CONDITIONS TO OBLIGATION OF EACH PARTY TO EFFECT THE
TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT.
The obligation of each party to effect the transactions contemplated
by this Agreement shall be subject to the fulfillment at or prior to the
Closing Date of the following conditions:
(a) all material authorizations, consents and approvals, if any,
of all Governmental Authorities necessary to permit the consummation of
the transactions contemplated by this Agreement shall have been obtained
and any waiting period (and any extension thereof) applicable to the
consummation of the Agreement under the HSR Act or under other
Competition Laws shall have expired or been terminated; and
(b) no preliminary or permanent injunction or other order,
decree or ruling issued by a court of competent jurisdiction or by a
Governmental Authority nor any statute, rule, regulation or executive
order promulgated or enacted by any Governmental Authority shall
be in effect that would restrain or otherwise prevent the consummation
of the transactions contemplated by the Agreement.
8.2 CONDITIONS TO THE OBLIGATION OF SELLER. The obligation of
Seller to effect the transactions contemplated by this Agreement is subject
to the fulfillment at or prior to the Closing Date of the following
conditions:
(a) Buyer shall have performed or complied in all material respects
with each obligation, agreement and covenant to be performed and complied
with by it hereunder at or prior to the Closing Date;
(b) the representations and warranties of Buyer in this Agreement
shall be true and correct in all material respects as of the Closing Date
with the same force and effect as though made at such time, except for
changes specifically agreed to by the parties;
(c) Buyer shall have furnished to Seller a certificate, dated as
of the Closing Date, signed by a duly authorized officer of Buyer to the
effect that all conditions set forth in Sections 8.2(a), (b) and (e) have
been satisfied;
(d) Buyer shall have delivered to Seller the Purchase Price either
entirely in cash or in cash and the Promissory Note; and
(e) in the event that Buyer delivers the Promissory Note to Seller,
the Bank Waiver shall have been obtained.
8.3 CONDITIONS TO THE OBLIGATION OF BUYER. The obligation of
Buyer to effect the transactions contemplated by this Agreement is subject
to the fulfillment at or prior to the Closing Date of the following conditions:
(a) Seller shall have performed or complied in all material respects
with each obligation, agreement and covenant to be performed and complied
with by it hereunder at or prior to the Closing;
(b) the representations and warranties of Seller in this Agreement
shall be true and correct in all material respects as of the Closing Date
with the same force and effect as though made at such time, except for
changes specifically agreed to by the parties;
(c) All Required Consents shall have been obtained;
(d) Seller shall have furnished to Buyer a certificate, dated
as of the Closing Date, signed by a duly authorized officer of Seller
to the effect that all conditions set forth in Sections 8.3(a) and (b)
have been satisfied;
(e) Seller shall have delivered to Buyer certificates representing the
Shares, duly endorsed in blank or accompanied by a stock powers or
appropriate instrument of assignment duly executed in blank, and
accompanied by the requisite stock transfer tax stamps to be paid by Buyer;
(f) The Governance Agreement, Symbiosis Corp. Incentive Compensation
Plan No. 1 ("Plan No. 1") and Symbiosis Corp. Incentive Compensation Plan
No. 2 ("Plan No. 2") shall have been terminated; and
(g) Each of the parties to the Governance Agreement and all the
Participants in Plan No. 1 shall have delivered releases to the Company,
in the form attached hereto as Exhibit C.
ARTICLE 9
AGREEMENTS WITH RESPECT TO EMPLOYEES AND EMPLOYEE BENEFITS
9.1 EMPLOYEE BENEFIT PLANS. Seller hereby represents and warrants
to Buyer as follows: Schedule 9.1(a) lists all the pension, profit sharing,
stock bonus, medical reimbursement, life insurance, disability, vacation,
severance pay, deferred compensation, bonus, stock option, insurance or
other employee compensation or benefit plans, programs and arrangements
that benefit any Employee, or any officer or director of the Company
(the "Plans") and Schedule 9.1(b) lists all contracts and agreements
relating to employment that provide for annual compensation in
excess of $60,000 and all severance agreements, with any of the
directors, officers or Employees of the Company (other than, in
each case, any such contract or agreement that is terminable by
the Company at will without penalty or other adverse consequence)
(the "Employment Contracts"). Buyer has been furnished with a
copy of each Plan and all amendments thereto (including existing
amendments that are to become effective at a later date), any
summary plan descriptions, annual reports, actuarial reports,
registration statements or other securities law filings and determination
letters produced or filed with respect thereto, and each Employment
Contract. Except as set forth in Schedule 9.1(c) (i) none of the
Plans is a multiemployer plan within the meaning of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA");
(ii) none of the Plans promises or provides retiree medical or life
insurance benefits to any person; (iii) each Plan intended to be
qualified under Section 401(a) of the Code has received a favorable
determination letter from the IRS that it is so qualified and nothing
has occurred since the date of such letter to affect the qualified
status of such Plan; (iv) none of the Plans promises or provides
severance benefits or benefits contingent upon a change in
ownership or control, within the meaning of Section 280G of the
Code; (v) each Plan has been operated in all material respects in
accordance with its terms and the requirements of applicable law;
(vi) no Plan is or has been covered by Title IV of ERISA or
Section 412 of the Code; (vii) the Company has not incurred
any direct or indirect liability under, arising out of or by operation
of Title IV of ERISA in connection with the termination of, or
withdrawal from, any Plan or other retirement plan or arrangement,
and no fact or event exists that could give rise to any such liability;
(viii) the Company has not incurred any liability under, and has
complied in all respects with, the Worker Adjustment Retraining
Notification Act, and no fact or event exists that could give rise
to liability under such act; and (ix) no litigation or administrative
or other proceedings involving the Plans or Employment Contracts
have occurred or, to the knowledge of Seller, are threatened,
that have had or would be reasonably expected to have, individually
or in the aggregate, a Material Adverse Effect. No Fractional
Interests (as defined therein) have been granted under Plan No. 2.
9.2 EMPLOYMENT MATTERS. Buyer shall cause the Company to
continue the employment of all Active Employees, effective as of the Closing
Date, in the same or comparable positions and at the same or comparable
salaries and other terms and conditions of employment, except as otherwise
provided in this Agreement, provided that nothing herein shall require
the Company or Buyer to continue the employment of any Active
Employee for any definite period. After the Closing Date, the
Company will have sole responsibility for any obligations or
liabilities to Active Employees at all locations under the Worker
Adjustment and Retraining Notification Act. Unless previously
paid by the Company prior to the Closing Date, Buyer agrees to
cause the Company to make separation payments to Active
Employees whose employment is terminated by the Company
or Buyer because of a reduction in the work force or job elimination
at any time after the Closing Date in accordance with the terms of
Buyer's severance plan, as in effect from time to time, and Applicable
Laws. For purposes of determining the amount of each Active
Employee's severance and vacation entitlement from Buyer or the
Company, the service of each Active Employee with Seller and
Seller's Affiliates shall be recognized.
9.3 EMPLOYEE WELFARE BENEFIT PLANS. Certain Employees are
covered by welfare benefit and insurance programs and policies maintained by
Seller for the benefit of the Company, including workers' compensation, all
of which programs and policies are set forth in Schedule 9.1 (except
workers' compensation, which is set forth in Schedule 4.17(a))
(hereinafter "AHP Programs"). Buyer acknowledges that AHP
Programs shall terminate as to Active Employees as of the Closing
Date, except as otherwise provided in this Section 9.3.
(a) Liabilities of Buyer and the Company. Except as provided in
paragraph (b) below, Buyer and the Company agree to provide to all Active
Employees and their eligible dependents, commencing as of the Closing
Date, group health, life and disability coverage and benefits comparable
in the aggregate to the coverage and benefits currently provided to
similarly situated employees of Buyer and their dependents, without
exclusion or limitation for any condition for which such an Active
Employee or dependent was covered prior to the Closing Date. Any
covered expenses incurred on or before the Closing Date by an Active
Employee or his or her eligible dependents shall be taken into account
for purposes of satisfying applicable deductible, co-insurance and out-
of-pocket provisions after the Closing Date to the same extent as
such expenses are taken into account for the benefit of similarly
situated employees of the Buyer.
Any Active Employee who is disabled or any Active Employee
or dependent who is hospitalized as of the Closing Date will continue
to be covered by AHP Programs, in accordance with the terms of such
Programs, until the date such individual is no longer disabled or
hospitalized. For this purpose, an Active Employee will be deemed
to be disabled if such Employee is, on the Closing Date, receiving
disability benefits or in a waiting period for such benefits. This
Agreement shall not be read or construed as (A) obligating the
Company or Buyer to provide any health care or other welfare
benefits or coverage to any Active Employee after retirement or
other termination of their employment (other than as required by
Part 6 of Subtitle B of Title I of ERISA), (B) obligating the Company
or Buyer to provide any health care or other welfare benefits or
coverage to any Former Employees, or (C) restricting the Company
or the Buyer from amending or terminating any health care or other
welfare plan or program maintained by the Company or the Buyer
at any time following the Closing Date.
(b) Liabilities Retained by Seller. From and after the Closing Date,
Seller shall, at its sole cost and expense, continue to provide the following
welfare benefits through AHP Programs. In the event that any of the
following welfare benefits are paid through welfare plans offered to Active
Employees and their dependents by the Company or Buyer on or after the
Closing Date, Seller shall, either directly or through AHP Programs,
promptly reimburse the Buyer or the Company, as the case may be, for
any such payments upon receipt of a written, documented request for
reimbursement from the Company.
(i) Seller shall remain liable for any and all medical, dental, life
insurance and other welfare or fringe benefit claims of Employees and their
dependents that are incurred before the Closing Date. For purposes of this
clause (i), a claim will be deemed to have been incurred when the medical,
dental or other services that give rise to the claim are provided, or upon
death.
(ii) Seller shall provide short-term disability (i.e., weekly accident and
sickness), long-term disability and workers' compensation benefits to each
Employee in accordance with the terms of any applicable disability plan
maintained for the benefit of such Employee or any workers' compensation
award, if such Employee is, as of the Closing Date, receiving such short-
term disability, long-term disability of workers' compensation benefits,
or is in a waiting period for the commencement of such benefits.
(iii) Seller shall remain liable for providing retiree medical,
prescription drug and life insurance coverage, and any other retiree
welfare benefits offered through AHP Programs, to Former Employees
(and their dependents and beneficiaries), and to Active Employees
(and their dependents and beneficiaries) who as of the Closing Date
have met the applicable age and service requirements for such retiree
coverage, regardless of their retirement dates.
(iv) Seller shall provide and remain liable for any and all continuation
of coverage required under Sections 601 through 608 of ERISA and Section
4980B of the Code with respect to any person as to whom the qualifying
event occurred prior to the Closing Date.
(c) Disabled Individuals. At the Closing, Seller shall provide to Buyer a
Schedule of all Employees who, as of that time, are receiving or have applied
to receive short-term disability, long-term disability or workers'
compensation benefits under an AHP Program, specifying the nature
of the disability of such Employee.
9.4 EMPLOYEE SAVINGS PLANS. Buyer maintains a qualified defined
contribution 401(k) savings plan ("Buyer's Saving Plan"). Seller maintains
the American Home Products Corporation Saving Plan ("Seller's
Savings Plan"). As of the Closing Date, all Active Employees shall
be eligible to participate in Buyer's Savings Plan, subject to the Plan's
service requirements, and Buyer shall amend, to the extent necessary,
such plan to recognize Active Employee's service with Seller and Seller's
Affiliates for purposes of eligibility for participation and vesting of
benefits. Seller shall make all matching contributions to Seller's Savings
Plan with respect to Employees required to be made by Seller or the
Company for periods prior to Closing. Seller shall amend Seller's
Savings Plan to provide that all Active Employees shall, as of the
Closing Date, be fully vested in any matching contributions by Seller
to such Employees' accounts in Seller's Savings Plan. As soon as
practicable after the Closing Date, account balances of all Active Employees
under Seller's Savings Plan shall be valued and transferred as of the
valuation date to Buyer's Savings Plan, such transfer to be made in
cash or other marketable assets and, as applicable, participant promissory
notes. Such transfer shall be effected in accordance with Applicable Laws,
and Buyer shall make or cause to be made, and Seller shall make or cause
to be made, any required filings in connection therewith. In consideration
of such transfer, Buyer or one of its Affiliates shall assume all liabilities
to such employees under Seller's Savings Plan. Each of the parties
hereto shall pay its own expense in connection with such transfer.
If Buyer does not receive a favorable determination letter from the
Internal Revenue Service with respect to Buyer's Savings Plan, within
18 months after the Closing Date, then, at Seller's request, all assets
previously transferred from Seller's Savings Plan shall be returned to
such Plan, together with any earnings thereon, along with the associated
liabilities.
As of the Closing Date, the Company shall continue to maintain,
or the Buyer shall assume, the Symbiosis Corporation 401(k) Retirement Plan.
9.5 REIMBURSEMENT BY THE PARTIES. To the extent that the Seller,
on the one hand, or the Company or Buyer, on the other hand, receive any
payment with respect to an employee welfare plan or program, or employee
pension plan or program after the Closing which belongs to the other party,
it shall promptly pay over such payment to the other party.
9.6 NO THIRD PARTY BENEFICIARIES. No provision of this Agreement
shall create any third party beneficiary or other rights in any Employee
(including any beneficiary or dependent thereof) in respect of continued
or resumed employment with the Company, with Seller, or with any of
its Affiliates and no provision of this Agreement shall create any such
rights in any such persons in respect of any benefits that may be provided,
directly or indirectly, under any employee plan or benefit arrangement,
including without limitation the Plans or any plan or arrangement which
may be established by Buyer or any of its Affiliates. No provision of this
Article 9 shall constitute a limitation on rights of Seller, the Company or
Buyer, as the case may be, to amend, modify or terminate before or after
the Closing Date any such plans or arrangements of Seller, the Company,
Buyer or any of their respective Affiliates, or the rights of Buyer, the
Company or any Affiliates of Buyer to terminate any Employee at will.
ARTICLE 10
TERMINATION, AMENDMENT AND WAIVER
10.1 TERMINATION. This Agreement may be terminated at any time prior to the
Closing Date:
(a) by mutual written consent of Buyer and Seller;
(b) by Buyer or Seller if the Closing shall not have occurred on
or prior to June 30, 1996, provided, however, that if the parties are involved
in proceedings described in Section 7.6, neither party shall have the right
to terminate this Agreement pursuant to this Section 10.1(b) until such time
as the first appeals referenced in Section 7.6 are completed, and further
provided, however, that the right to terminate under this Section 10.1(b)
shall not be available to a party whose failure to fulfill any obligation
under this Agreement has been the cause of, or resulted in, the failure
of the Closing to occur on or before such date;
(c) by Buyer or Seller if a court of competent jurisdiction or
Governmental Authority shall have issued an order, decree or ruling or
taken any other action, in each case permanently restraining, enjoining
or otherwise prohibiting the transactions contemplated by this Agreement,
and such order, decree, ruling or other action shall have become final and
nonappealable; or
(d) by Seller or Buyer, upon a breach of, or noncompliance with,
any representation, warranty, covenant or agreement on the part of the other
party hereto set forth in this Agreement such that the conditions set forth
in Section 8.2(a) or (b) or 8.3(a) or (b), respectively, would not be
satisfied assuming for purposes of this Section 10.1(d) that the date
of the termination is the Closing Date (a "Terminating Breach");
provided, however, that, if such Terminating Breach is curable by
the other party hereto through the exercise of its reasonable efforts
within 60 days of notice by the other party of such breach, and the
other party is using its reasonable efforts to cure such breach, the other
party may not terminate this Agreement solely pursuant to this Section
10.1(d).
The date on which this Agreement is terminated pursuant to any
of the foregoing subsections of this Section 10.1 is herein referred to
as the "Termination Date."
10.2 EFFECT OF TERMINATION. Except as set forth in Sections 7.2
and 7.4, upon the termination of this Agreement pursuant to Section 10.1,
this Agreement shall forthwith become null and void, except that nothing
herein shall relieve any party from liability for breach of this Agreement
prior to such termination.
ARTICLE 11
INDEMNIFICATION
11.1 INDEMNIFICATION.
(a) Subject to Section 11.3, Seller shall indemnify, defend and
hold harmless Buyer and the Company and their respective Affiliates,
officers, directors, employees and controlling Persons, agents, successors
and assigns from any and all liabilities, damages, deficiencies, losses,
judgments, assessments, costs or expenses, including reasonable attorneys'
fees and expenses and costs of investigating and defending against lawsuits,
complaints, actions or other pending or threatened litigation (being
hereafter referred to in this Article 11 as "Costs"), arising from or
attributable to:
(i) The breach of any representation or warranty made by Seller in this
Agreement;
(ii) Any failure of Seller to perform or observe any covenant or
agreement to be performed or observed by Seller pursuant to this Agreement;
(iii) Any claim or cause of action of any third party to the extent arising
out of the sale of any products by the Company or the manufacture
by the Company of any packaged finished product, in each case on or
prior to the Closing Date except to the extent caused by actions of the
Company or Buyer following the Closing;
(iv) (a) The costs in excess of $250,000 for the purchase of equipment
selected by Seller and reasonably acceptable to Buyer (the "Replacement
Equipment") necessary to cause the Company to comply with Applicable
Laws as to the Total Suspended Solids content of effluent discharged by
the Company to the sanitary sewer and (b) enforcement by any
Governmental Authority (including the Dade County Department of
Environmental Resources Management) with respect to a violation
of limitations imposed by Dade County Standards on the Total
Suspended Solid content of effluent discharged by the Company
to the sanitary sewer, in respect of discharge occurring prior to the
Closing Date or, as a result of operation by Buyer of existing
equipment substantially in the manner operated by the Company
prior to the Closing Date, during the period from the Closing Date
until the installation of the Replacement Equipment; provided,
however, that in no event shall such time period extend beyond nine
months following the Closing Date; or
(v) (a) the termination by Seller pursuant to the Power of Attorney of the
license agreements referred to therein other than in accordance with the
terms of such license agreements (as they exist on the Closing Date or
as amended, provided Seller has received copies of any such amendment)
or (b) the purported termination by Seller of such license agreements
other than in accordance with the Power of Attorney.
(b) Buyer shall indemnify and hold harmless Seller, its officers,
directors and employees from Costs arising from or attributable to:
(i) The breach in any representation or warranty made by
Buyer in this Agreement;
(ii) Any failure of Buyer to perform or observe any covenant
or agreement to be performed or observed by Buyer pursuant
to this Agreement;
(iii) The guarantee of the obligations of the Company entered into
by Seller pursuant to the Aggregation Agreement; or
(iv) Any noncompliance by the Company or Buyer's Affiliates
with any Environmental Laws first occurring after the Closing Date,
any Release, threatened Release or presence of any Hazardous Substance
at the Leased Real Property first occurring after the Closing Date or any
disposal or arrangement therefor or any Hazardous Substance first
generated by the Company after the Closing Date.
(c) Seller and Buyer shall indemnify the other for all
Taxes for the periods and in the manner described in Section 7.7.
11.2 PROCEDURES. (i) Promptly after any Person entitled to
indemnity hereunder has determined that a matter has given rise,
or will give rise, to a claim for indemnification under this Agreement,
such Person (the "Aggrieved Party") will, if a claim with respect
thereto is to be made against any party obligated to provide
indemnification (the "Indemnifying Party") pursuant to this Article
11, give such Indemnifying Party written notice of such matter;
provided, however, that the failure to provide such notice shall not
release any Indemnifying Party from any of its obligations under
this Article 11 except to the extent such Indemnifying Party is
prejudiced by such failure. The Indemnifying Party shall be
entitled to assume and control the defense of any such claim
or any litigation resulting from such claim, but shall allow the
Aggrieved Party a reasonable opportunity to participate in
(but not control) the defense thereof with its own counsel at
its own expense. The Indemnifying Party shall select counsel,
contractors and consultants of recognized standing and
competence after consultation with the Aggrieved Party and
shall take all steps necessary in the defense or settlement thereof.
In conducting the defense thereof, the Indemnifying Party shall
at all times act as if all damages relating to such claim were for
its own account and shall act in good faith and with reasonable
prudence to minimize damages therefrom. The Aggrieved Party
shall cooperate fully with the Indemnifying Party in the conduct
of such defense. Failure by the Indemnifying Party to notify the
Aggrieved Party of its election to defend any such action within
a reasonable time, but in no event more than fifteen days after
notice thereof shall have been given to the Indemnifying Party,
shall be deemed a waiver by the Indemnifying Party of its right
to defend such action. If, however, there exists or is reasonably
likely to exist a conflict of interest that would make it inappropriate
for the same counsel to represent both the Aggrieved Party and the
Indemnifying Party, then the Aggrieved Party shall be entitled to
retain its own counsel in connection with such matter in each
jurisdiction where counsel is required at the expense of the
Indemnifying Party. The Indemnifying Party shall not, in the
defense of such claim or any litigation resulting therefrom,
consent to entry of any judgment, except with the written
consent of the Aggrieved Party, or enter into any settlement,
except with the written consent of the Aggrieved Party, which
does not include as an unconditional term thereof the giving
by the claimant or the plaintiff to the Aggrieved Party of an
unconditional release from all liability in respect of such claim
or litigation. All Costs payable by a third party to the Aggrieved
Party or the Indemnifying Party shall belong to the Indemnifying Party.
(ii) If the Indemnifying Party shall not assume the defense of any
such claim or litigation resulting therefrom, the Aggrieved Party may defend
against such claim or litigation in such manner as it may deem appropriate
and, unless the Indemnifying Party shall deposit with the Aggrieved Party
a sum equivalent to the total amount demanded in such claim or litigation
less the Minimum Loss, or shall deliver to the Aggrieved Party a surety
bond in form and substance reasonably satisfactory to the Aggrieved
Party in such amount, the Aggrieved Party may settle such claim or
litigation on such terms as it may deem appropriate, and the
Indemnifying Party shall promptly reimburse the Aggrieved Party
for the amount of all Costs incurred by the Aggrieved Party in
connection with the defense against or settlement of such claim or
litigation. If no settlement of such claim or litigation is made, the
Indemnifying Party shall promptly reimburse the Aggrieved Party
for the amount of any Costs incurred by the Aggrieved Party with
respect to such claim or in such litigation.
(iii) If there shall be any conflicts between the provisions
of this Section 11.2 and Section 7.7(c) (relating to Tax contests),
the provisions of Section 7.7(c) shall control with respect to Tax contests.
11.3 LIMITATIONS. (a) An Aggrieved Party shall not be entitled to
recover any Costs under Section 11.1(a)(i) (other than in respect of
Sections 4.2 and 4.18, as to which this Section 11.3 shall not apply)
until the aggregate amount of the Costs suffered by the Aggrieved
Party thereunder shall exceed $750,000 (the "Minimum Loss"), at
which time the indemnification provided thereunder shall apply to
all Costs in excess of the amount of Minimum Loss, and (b) the
maximum liability under Section 11.1 (other than Sections 11.1(a)(iii),
11.1(a)(iv), 11.1(a)(v), 11.1(b)(iii) and 11.1(c) which shall not be
subject to this Section 11.3) for an Indemnifying Party shall not
exceed $50 million in the aggregate.
11.4 INDEMNIFICATION AS SOLE REMEDY. Except with respect to
the Promissory Note (which shall be governed by its terms), the
indemnification provided in this Article 11, subject to the limitations
set forth herein, shall be the exclusive post-Closing remedy for
damages available to any Aggrieved Party.
ARTICLE 12
GENERAL PROVISIONS
12.1 PUBLIC STATEMENTS. So long as this Agreement is in effect,
none of the parties hereto shall issue or cause the publication of any
press release or other announcement with respect to this Agreement
or the transactions contemplated hereby without consulting with and
obtaining the consent of the other party; provided, however, that such
consent shall not be required where such release or announcement is
required by Applicable Law.
12.2 NOTICES. All notices and other communications hereunder or
under the Power of Attorney shall be in writing and shall be deemed to have
been duly given if delivered personally, mailed by reputable overnight
courier or certified mail (return receipt requested) or sent by telecopier
(confirmed thereafter by personal delivery, such courier or such certified
mail) to the parties at the following addresses or at such other addresses
as shall be specified by the parties by like notice:
(a) if to Seller:
American Home Products Corporation
Five Giralda Farms
Madison, New Jersey 07940
Attention: David Lilley
Vice President
Telecopier Number: (201) 660-7156
with a copy to:
Louis L. Hoynes, Jr.
Senior Vice President and General Counsel
American Home Products Corporation
Five Giralda Farms
Madison, New Jersey 07940
Telecopier Number: (201) 660-6030
(b) if to Buyer:
Boston Scientific Corporation
One Boston Scientific Place
Natick, Massachusetts 01760
Attention: General Counsel
Telecopier Number: (508) 650-8960
with a copy to:
Shearman & Sterling
599 Lexington Avenue
New York, New York 10022
Attention: Clare O'Brien, Esq.
Telecopier Number: (212) 848-7179
Notice so given shall (in the case of notice so given by mail) be deemed
to be given and received on the third calendar day after mailing or the next
business day if sent by a reputable overnight courier and (in the case of
notice so given by telecopier or personal delivery) on the date of actual
transmission or (as the case may be) personal delivery.
12.3 SURVIVAL OF REPRESENTATIONS AND WARRANTIES.
The respective representations and warranties of the parties hereto shall
survive the Closing and shall remain in full force and effect, provided,
however, that (a) the representations and warranties in Section 4.7 and
the provisions of Section 7.7 shall survive until the applicable statute
of limitations has run for such Tax and the provisions of Section 7.5
shall survive until the seventh anniversary of the Closing, (b) the
representations and warranties in Section 4.14 shall survive until
the sixth anniversary of the Closing Date; and (c) all other
representations and warranties shall expire eighteen months after
the Closing Date. Neither the period of survival nor the liability
of a party with respect to such party's representations and warranties
shall be reduced by any investigation made at any time by or on
behalf of the other party hereunder. If written notice of a claim has
been given prior to the expiration of the applicable representations
and warranties by one party to the other, then such claim shall survive
until finally resolved.
12.4 AMENDMENT. This Agreement may not be amended except
by an instrument in writing signed on behalf of each of the parties hereto.
12.5 WAIVER. At any time prior to the Closing, any term, provision or
condition of this Agreement may be waived in writing (or the time for
performance of any of the obligations or other acts of the parties hereto
may be extended) by the party that is entitled to the benefits thereof.
12.6 PARTIES IN INTEREST. This Agreement may not be assigned
by a party without the prior written consent of the other parties hereto.
This Agreement shall not run to the benefit of or be enforceable by any
person other than a party to this Agreement and, subject to the first
sentence of this Section, its successors and assigns.
12.7 MISCELLANEOUS. This Agreement (including the Promissory
Note, confidentiality agreement and the documents and instruments
referred to herein) constitutes the entire agreement and supersedes
all other prior agreements and undertakings, both written and oral,
between the parties, or any of them, with respect to the subject
matter hereof; is not intended to confer upon any other person
any rights or remedies hereunder; and shall be governed in all
respects, including validity, interpretation and effect, by the
internal laws of the State of New York without giving effect
(to the extent permissible by law) to the principles of conflicts
of laws thereunder. This Agreement may be executed in one
or more counterparts which together shall be held to be one
and the same agreement. If any term or other provision of
this Agreement is invalid, illegal or incapable of being
enforced by any rule of law or public policy, all other conditions
and provisions of this Agreement shall nevertheless remain in
full force and effect so long as the economic or legal substance
of the transactions contemplated hereby is not affected in any
manner materially adverse to any party. Upon such determination
that any term or other provisions is invalid, illegal or incapable
of being enforced, the parties hereto shall negotiate in good faith
to modify this Agreement so as to effect the original intent of
the parties as closely as possible in an acceptable manner in
order that the transactions contemplated hereby are consummated
as originally contemplated to the greatest extent possible.
12.8 SPECIFIC PERFORMANCE. The parties hereto agree that
irreparable damage would occur in the event delivery of the Shares at
Closing was not performed in accordance with the terms hereto and that
the Buyer shall be entitled to specific performance of the delivery of the
Shares at Closing in addition to any other remedy at law or equity.
12.9 ACCESS TO RECORDS AFTER CLOSING. (a) For a period of six
years after the Closing Date, Seller and its representatives shall
have reasonable access to all of the books and records of the Company
with respect to the period prior to the Closing Date to the extent that such
access may reasonably be required by Seller in connection with matters
relating to or affected by the operations of the Company prior to
the Closing Date. The Company shall afford such access upon receipt
of reasonable advance notice and during normal business hours.
Seller shall be solely responsible for any costs or expenses incurred
by it pursuant to this Section 12.9. If the Company shall desire to
dispose of any of such books and records prior to the expiration of
such six-year period, the Company shall, prior to such disposition,
give Seller a reasonable opportunity, at Seller's expense, to segregate
and remove such books and records as Seller may elect.
(b) For a period of six years after the Closing Date, Buyer, the
Company and their respective representatives shall have reasonable
access to all of the books and records relating to the Company which
Seller or any of its Affiliates may retain after the Closing Date. Such
access shall be afforded by Seller and its Affiliates upon receipt of
reasonable advance notice and during normal business hours. Buyer
or the Company, as the case may be, shall be solely responsible for
any costs and expenses incurred by it pursuant to this Section 12.9.
If Seller or any of its Affiliates shall desire to dispose of any of such
books and records prior to the expiration of such six-year period,
Seller shall, prior to such disposition, give Buyer and the Company
a reasonable opportunity, at Buyer's or the Company's expense, to
segregate and remove such books and records as Buyer of the Company may elect.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their duly authorized officers as of the date first written
above.
AMERICAN HOME PRODUCTS CORPORATION
By: /s/ David Lilley
Name: David Lilley
Title: Vice President
BOSTON SCIENTIFIC CORPORATION
By: /s/ Peter M. Nicholas
Name: Peter M. Nicholas
Title: Chairman and Chief Executive Officer
