EXHIBIT 2.5
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ASSET PURCHASE AGREEMENT
BY AND AMONG
BARD ACCESS SYSTEMS, INC.,
SPIRE BIOMEDICAL, INC.
AND
SPIRE CORPORATION
Dated as of September 4, 2009
TABLE OF CONTENTS
Page
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ARTICLE I DEFINITIONS......................................................... 1
1.01 Definitions......................................................... 1
1.02 Other Defined Terms................................................. 8
ARTICLE II PURCHASE AND SALE OF ASSETS; ASSUMPTION OF LIABILITIES;
PURCHASE PRICE..................................................10
2.01 Purchase and Sale...................................................10
2.02 Excluded Assets.....................................................12
2.03 Assumption of Liabilities...........................................13
2.04 Excluded Liabilities................................................13
2.05 Purchase Price; Closing Payment.....................................14
2.06 Price Adjustment Related to Product Inventory.......................14
2.07 Allocation of Purchase Price........................................17
2.08 Withholding.........................................................17
ARTICLE III CLOSING...........................................................17
3.01 Time and Place......................................................17
3.02 Deliveries by Seller and Parent.....................................18
3.03 Deliveries by Buyer.................................................19
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF SELLER AND PARENT................20
4.01 Organization; Qualification.........................................20
4.02 Power and Authority.................................................20
4.03 No Violation........................................................20
4.04 Consents............................................................21
4.05 Title to Acquired Assets............................................21
4.06 Litigation..........................................................21
4.07 Material Contracts..................................................21
4.08 Licenses and Permits................................................23
4.09 Compliance with Law and Regulatory Requirements; Warranties.........24
4.10 Environmental Matters...............................................26
4.11 Employees...........................................................27
4.12 Taxes...............................................................27
4.13 Intellectual Property...............................................28
4.14 Product Data; Product Specifications................................31
4.15 Sufficiency of Assets...............................................31
4.16 Financial Information; Indebtedness.................................31
4.17 Absence of Certain Changes or Events................................32
4.18 Product Inventory...................................................32
4.19 Customers and Suppliers.............................................32
4.20 Insurance...........................................................33
4.21 Affiliate Transactions..............................................33
4.22 Brokers' Fees.......................................................33
4.23 Corrective Action Plans and Reclassification Plan...................33
4.24 Semi-Exclusive License..............................................33
4.25 Disclosure..........................................................34
4.26 Solvency............................................................34
ARTICLE V REPRESENTATIONS AND WARRANTIES OF BUYER.............................34
5.01 Organization........................................................34
5.02 Authority...........................................................34
5.03 No Violation........................................................34
5.04 Consents............................................................35
5.05 Broker's Fees.......................................................35
5.06 Litigation..........................................................35
5.07 Semi-Exclusive License..............................................35
ARTICLE VI COVENANTS OF BUYER, SELLER, AND PARENT.............................35
6.01 Pre-Closing Covenants...............................................35
6.02 Public Announcements................................................37
6.03 Further Assurances..................................................37
6.04 Expenses............................................................38
6.05 Delivery of Acquired Assets and Excluded Assets.....................38
6.06 Confidentiality.....................................................38
6.07 Non-Competition; Non-Disparagement..................................39
6.08 Certain Tax Matters.................................................41
6.09 Use of Names and Marks..............................................42
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6.10 Defense of Claims and Litigation....................................42
6.11 Retention of Records................................................42
6.12 Sharing of Data.....................................................43
6.13 Product Liability...................................................43
6.14 Chargebacks, Rebates, Administrative Fees, and Returns..............43
6.15 Transfer of Permits.................................................43
6.16 Destruction of Excluded Inventory...................................44
6.17 Delivery of Tangible Acquired Assets................................44
6.18 Covenants Not to ▇▇▇................................................44
ARTICLE VII INDEMNITY.........................................................44
7.01 Survival............................................................44
7.02 Indemnity by Seller and Parent......................................45
7.03 Indemnity by Buyer..................................................45
7.04 Indemnity Procedures................................................46
7.05 Limitations.........................................................48
7.06 Third Party Beneficiaries...........................................49
7.07 Tax Treatment of Indemnity Payments.................................49
7.08 Updates to Seller Disclosure Schedules..............................49
ARTICLE VIII CLOSING CONDITIONS...............................................49
8.01 Conditions to Buyer's Obligation....................................49
8.02 Conditions to Seller's and Parent's Obligations.....................50
ARTICLE IX TERMINATION........................................................51
9.01 Termination of Agreement............................................51
9.02 Effect of Termination...............................................51
ARTICLE X MISCELLANEOUS.......................................................52
10.01 Binding Effect; Assignment; No Third-Party Rights...................52
10.02 Entire Agreement....................................................52
10.03 Notices.............................................................52
10.04 Severability........................................................53
10.05 Amendment; Waiver, etc..............................................54
10.06 Governing Law; Consent to Jurisdiction..............................54
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10.07 Waiver of Trial By Jury.............................................54
10.08 Counterparts........................................................54
10.09 Neutral Construction................................................54
10.10 Inducement; Specific Performance....................................55
10.11 Interpretation......................................................55
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EXHIBITS:
Exhibit A ▇▇▇▇ of Sale and Assignment and Assumption Agreement
Exhibit B License Agreement
Exhibit C Sublicense Agreement
Exhibit D Consulting Agreement
Exhibit E Non-Competition Agreement
Exhibit F Patent Assignment
Exhibit G Copyright Assignment
Exhibit H Trademark Assignment
Exhibit I Notified Body Letters
SCHEDULES:
Schedule 1.01(a) Excluded Inventory
Schedule 2.01(b)(i) Products
Schedule 2.01(b)(x) Assumed Contracts
Schedule 2.01(b)(xiii) Equipment
Schedule 2.01(b)(xvi) Other Acquired Assets
Schedule 2.02 Excluded Assets
Schedule 2.02(g) Retained Seller Intellectual Property
Schedule 3.02(e) Key Persons
Schedule 4.03(iii) No Violation
Schedule 4.04 Consents
Schedule 4.05(a) Title to Acquired Assets
Schedule 4.05(b) Right to Sell, Transfer and Assign
Schedule 4.05(c) Ownership
Schedule 4.05(d) Licenses to use all Licensed Intellectual Property
Schedule 4.06 Litigation
Schedule 4.07(a) Material Contracts
Schedule 4.07(b) Legality, Validity, Enforceability, etc.
Schedule 4.07(c) Contract Matters
Schedule 4.07(d) Current Negotiations
Schedule 4.08(a) Permits
Schedule 4.08(b)(i) Permit Non-Renewal, Cancellation, etc.
Schedule 4.08(b)(ii) Permit Consents
Schedule 4.09(a)(i) Compliance with Laws
Schedule 4.09(a)(ii) Corrective Actions
Schedule 4.09(b) Compliance with FDCA, etc.
Schedule 4.09(c) Regulatory Notices, Findings, etc.
Schedule 4.09(f)(i) Product Defect Actions
Schedule 4.09(f)(ii) Modifications to Product
Schedule 4.12(b) Tax Matters
Schedule 4.12(f) Closing Agreements and Tax Rulings
Schedule 4.13(a) Owned Intellectual Property
Schedule 4.13(b)(i)(1) Licensed Intellectual Property
Schedule 4.13(b)(i)(2) Inbound Intellectual Property License
Schedule 4.13(b)(ii) Outbound Intellectual Property License
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Schedule 4.13(b)(iii) Intellectual Property Disputes
Schedule 4.13(c)(i) Intellectual Property Sufficiency
Schedule 4.13(c)(ii) Intellectual Property Assignment Restrictions
Schedule 4.13(e) Matters Relating to Design, Conception, etc.
Schedule 4.13(f) Intellectual Property Enforcement Restrictions
Schedule 4.13(g) Intellectual Property Infringement
Schedule 4.14(a) Product Data
Schedule 4.14(b) Clinical Trials
Schedule 4.14(c) Product Specifications
Schedule 4.15 Excluded Assets for Sufficiency Representation
Schedule 4.16(a) Financial Information
Schedule 4.16(b) Indebtedness
Schedule 4.17(a) Absence of Certain Changes or Events
Schedule 4.17(b) No Material Adverse Effect
Schedule 4.18 Product Inventory
Schedule 4.19(a) Customers and Suppliers
Schedule 4.19(b) Issues with Customers and Suppliers
Schedule 4.20 Business Insurance Policies
Schedule 4.21 Affiliate Transactions
Schedule 4.22 Brokers' Fees
Schedule 4.23(a) Corrective Action Plans
Schedule 4.23(b) Reclassification Plan
Schedule 4.24(a) Semi-Exclusive License Distributors
Schedule 4.24(b) Semi-Exclusive License Matters
Schedule 5.04 Buyer Consents
Schedule 6.14 Spire Return and Replacement Policy
Schedule 8.01(g) Other Matters
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ASSET PURCHASE AGREEMENT
ASSET PURCHASE AGREEMENT dated as of September 4, 2009 (this "Agreement")
by and among BARD ACCESS SYSTEMS, INC., a Utah corporation ("Buyer"), SPIRE
BIOMEDICAL, INC., a Massachusetts corporation ("Seller"), and SPIRE CORPORATION,
a Massachusetts corporation ("Parent"). Buyer, Seller and Parent are
collectively referred to herein as the "Parties."
RECITALS
WHEREAS, Seller and Parent are in the business of, among other things,
developing, designing, manufacturing, marketing, distributing and selling,
directly or indirectly, various coated and uncoated hemodialysis catheter
products and related catheter kits, accessory products and coatings used or
intended or held for use by Seller, Parent or any other Seller Affiliate in the
field of hemodialysis therapy (the "Business"); and
WHEREAS, Buyer wishes to purchase or acquire, directly or indirectly, from
Seller and Parent, and Seller and Parent wish to sell, assign and transfer to
Buyer all of the Acquired Assets in exchange for the purchase price set forth
herein, which represents reasonably equivalent value therefor, and upon the
other terms and conditions of this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants, representations
and warranties made herein, the Parties agree as follows:
ARTICLE I
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DEFINITIONS
1.01 Definitions. For purposes of this Agreement and any Exhibit or
Schedule hereto, the following terms shall have the meanings ascribed to them
below:
"Action" means any claim, action, suit, audit, examination, proceeding,
arbitral action, governmental inquiry, criminal prosecution or other
investigation.
"Affiliate(s)" means, with respect to any Person, any other Person (i)
directly or indirectly controlling, controlled by, or under common control with,
such Person, (ii) directly or indirectly owning or holding fifty percent (50%)
or more of any equity interest in such Person, or (iii) fifty percent (50%) or
more of whose voting stock or other equity interest is directly or indirectly
owned or held by such Person; provided, that "Affiliate" shall not include any
natural Persons in their capacity as an officer or director of any Person. For
purposes of this definition, "control" (including with correlative meanings, the
terms "controlling," "controlled by" and under "common control with") means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of a Person, whether through the
ownership of voting securities, by contract or otherwise.
"Benefit Plan" means each "employee benefit plan" (as such term is
defined in
Section 3(3) of Employee Retirement Income Security Act of 1974, as amended
("ERISA")) and each employment, consulting, independent contractor, bonus,
incentive, equity purchase, option or other equity-based, deferred compensation,
loan, severance, termination, retention, change of control, collective
bargaining or other agreement with any works council or association, profit
sharing, pension, retirement, 401(k), multiemployer (within the meaning of
Section 3(37) of ERISA), vacation, medical or other welfare, disability, life
(including split-dollar life) insurance, Section 125, fringe benefit and any
other employee or retiree benefit or compensation plan, funding mechanism,
agreement, program, policy or other arrangement, in each case whether or not
subject to ERISA or written or unwritten or legally binding or not, and (i) that
is maintained, sponsored or contributed to by Seller or Parent or any ERISA
Affiliate thereof for the benefit of any current or former employee, director,
officer or independent contractor of Seller or Parent, or the beneficiaries or
dependents of any such individual, or (ii) under which Seller, Parent or any
other Seller Affiliate has had or has any present or future liability.
"Business Intellectual Property" means, collectively, the Owned
Intellectual Property and the Licensed Intellectual Property.
"Claims" means any and all indemnity claims by Buyer or the other
Persons entitled to indemnity under Section 7.02 and any and all indemnity
claims by Seller or the other Persons entitled to indemnity under Section 7.03.
"Code" means the Internal Revenue Code of 1986, as amended.
"Contracts" means any written or oral contracts, agreements, leases,
licenses, understandings, arrangements, commitments, sales orders, and purchase
orders.
"Copyrights" means all works of authorship and all copyrights therein,
whether such works are published or unpublished works, and all applications,
registrations and renewals in connection therewith including software or source
code.
"Damages" means demands, claims, actions or causes of action,
assessments, losses, damages, liabilities, obligations, penalties, fines, Taxes,
interest, costs and expenses (including fees and expenses of counsel, costs of
collection, costs of defense, costs of enforcing indemnification provisions and
expenses of investigation).
"Device Regulation" means any Law relating to any Regulated Product in
the United States, the European Union or any other country or jurisdiction where
a Regulated Product is marketed or sold.
"Directive" means the European Union Directive, 93/42/EEC (OJ No L
169/1, 12 July 1993), as amended.
"Disclosures of Invention" means any written, oral or visual idea,
concept or invention of Seller, Parent, any other Seller Affiliate, any Spire
Person, or any Person from whom Seller, Parent or any other Seller Affiliate has
obtained intellectual property rights in any manner relating to the Business,
whether or not such idea, concept or invention has been filed as a patent
application or submitted by the inventor(s) to any attorney, agent or other
representative
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of Seller, Parent or any other Seller Affiliate for evaluation as to
patentability.
"DMR" means device master record.
"Domain Names" means domain name registrations and uniform resource
locator addresses.
"Encumbrance" means any mortgage, pledge, security interest, lien,
reservation, exception, encroachment, easement, right-of-way, covenant,
condition, restriction, lease or other similar title exception or encumbrance.
"Environmental Laws" means all federal, state or local Laws relating to
the environment (including the pollution or protection thereof), the
preservation or reclamation of natural resources, or public health and safety,
each as amended.
"ERISA Affiliate" means any trade or business, whether or not
incorporated, that, together with Seller and/or Parent, is or would have been at
any date of determination occurring within the preceding six (6) years, treated
as a single employer within the meaning of Section 414 of the Code.
"Excluded Inventory" means those finished Products, goods inventory and
work-in-process of Seller and Parent Primarily Used in the Business and related
components, labeling, packaging or other materials and supplies that, in each
case, are listed on Schedule 1.01(a).
"Excluded Taxes" means (i) any liability of Parent or Seller for Taxes,
whether or not attributable to the Business or the Acquired Assets, and whether
or not arising from or related to the transactions contemplated by this
Agreement, except to the extent that Buyer is responsible for such Taxes
pursuant to Section 6.08(a) herein, and (ii) any liability for Taxes
attributable to the Business or the Acquired Assets that relate to any Tax
period (or portion thereof) ending on or before the Closing Date.
"FDA" means the United States Food and Drug Administration or any
successor regulatory agency in the United States.
"FDCA" means the United States Federal Food, Drug and Cosmetic Act of
1938, as amended (21 U.S.C. ▇▇.▇▇. 301 et. seq.) and all regulations promulgated
thereunder.
"GAAP" means United States generally accepted accounting principles as
in effect from time-to-time, consistently applied.
"Governmental Authority" means any government, any governmental entity,
department, commission, board, agency, authority or instrumentality, any
regulatory authority or body (including any Notified Body), and any court,
tribunal or judicial body, in each case whether federal, state, county,
provincial, local, foreign or multinational.
"Hazardous Substances" shall mean any material presently listed,
defined, designated or classified as hazardous, toxic or radioactive, under any
Environmental Laws,
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whether by type or by quantity, and petroleum or any derivative or by-product
thereof.
"IDE" means an investigational device exemption or other application
required to be submitted to a Governmental Authority and be approved or
otherwise legally effective before the commencement of any human clinical study
of a Product.
"Indebtedness" means, without duplication, with respect to Seller,
Parent and the Business, the aggregate amount (including the current portions
thereof) of all (i) indebtedness for money borrowed from other Persons (whether
or not Affiliates), (ii) indebtedness evidenced by any note, bond, debenture or
other debt security or instrument, (iii) purchase money indebtedness, (iv)
obligations for or in respect of the deferred purchase price of services, and
reimbursement obligations with respect to letters of credit, (v) obligations
under any interest rate, currency or other hedging agreements, (vi) all interest
expense accrued but unpaid, and all prepayment premiums and penalties, on or
relating to any of such indebtedness, (vii) that portion of obligations with
respect to capitalized leases that is properly classified as a liability on the
consolidated balance sheet of such Person, and (viii) any obligations of any
other Person of a type referred to in clauses (i) - (vii) to the extent
guaranteed by such Person.
"Information" means any and all know-how and information, Trade
Secrets, clinical development, manufacturing processes, general processes and
systems, and other technical and marketing information related to the Acquired
Assets or the operation of the Business (whether or not confidential,
proprietary, patented or patentable), and all tangible embodiments of any of the
foregoing in written, electronic or any other form.
"Intellectual Property" means (i) all Patents, (ii) all Trademarks,
(iii) all Copyrights, (iv) all Trade Secrets, (v) all other recognizable
equivalent intellectual property rights, and (vi) all copies and tangible
embodiments of the foregoing, in each case whether arising under the laws of the
United States or any jurisdiction worldwide.
"Known to Seller" or "to Seller's Knowledge" means the actual knowledge
of any or all of the following natural Persons, in each case, after reasonable
inquiry thereby: ▇▇▇▇▇ ▇▇▇▇▇▇, Chief Executive Officer of Parent; ▇▇▇▇ ▇▇▇▇▇▇,
President and Chief Executive Officer of Seller and a director of Parent;
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Chief Financial Officer of Seller and Parent; ▇▇▇▇ ▇▇▇▇▇,
Vice President and Chief Operating Officer of Seller; ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Vice
President, Sales and Marketing of Seller; ▇▇▇▇▇▇ Rule, Acting Director of
Regulatory and Quality Assurance of Seller; and ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, Director,
Product Development and Manufacturing of Seller.
"Law" means any federal, state, county, provincial, local, foreign or
multinational law, statute, ordinance, rule, regulation, guidance, procedure or
guideline.
"Loan Agreements" means, collectively, (i) that certain Amended and
Restated Loan and Security Agreement, effective as of May 31, 2009, between
Silicon Valley Bank, Parent, Seller, Spire Solar, Inc. and Spire SemiConductor,
Inc., and (ii) that certain Export-Import Bank Loan and Security Agreement,
effective as of May 31, 2009, between Silicon Valley Bank, Parent, Seller and
Spire Semiconductor, LLC.
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"Material Adverse Effect" means any event, change, circumstance,
condition, development, or effect that, individually or in the aggregate, could
reasonably be expected to have a material adverse effect on (i) the Acquired
Assets (taken as a whole), or the assets, liabilities, prospects, condition
(financial or otherwise) or the results of operations of Seller or the Business,
or (ii) the ability of Seller and Parent to perform their respective obligations
under this Agreement and/or consummate the transactions contemplated hereby;
provided that none of the following shall be deemed (either alone or in
combination) to constitute a Material Adverse Effect: (a) a general
deterioration in the economy or in the medical device industry (except to the
extent any such deterioration has or would reasonably be expected to have a
disproportionate adverse effect on the Business as compared to other businesses
in the medical device industry); (b) the outbreak or escalation of hostilities
involving the United States or any other country, the declaration by the United
States or any other country of a national emergency or war or the occurrence of
any other calamity or crisis, including an act of terrorism; (c) the disclosure
of or the fact that Buyer is the prospective acquirer of the Acquired Assets;
(d) the announcement or pendency of the transactions contemplated by this
Agreement; (e) actions taken by Buyer or any of its Affiliates, officers,
directors, agents or advisers; or (f) compliance with the terms of, or the
taking of any action required or contemplated (and permitted) by this Agreement.
"MDRs" means reports of adverse events related to medical devices
required to be filed by medical device manufacturers or user facilities pursuant
to any Device Regulation, including medical device reports under 21 C.F.R. Part
803 and medical device vigilance reports.
"Notified Body" means the certification organization designated by the
relevant member state of the European Union, authorized to conduct conformity
assessments in accordance with the procedures listed in the Directive.
"Order" means any order, writ, judgment, injunction, award or decree of
any Governmental Authority.
"Patents" means all discoveries, innovations, inventions and all
improvements thereto and all classes and types of patents granted by a
Governmental Authority, including utility models, utility patents and design
patents, and all patent applications therefor, and patent disclosures relating
thereto, together with all reissuances, continuations, continuations-in-part,
revisions, extensions, and reexaminations thereof.
"Person" means any individual, partnership, firm, corporation, limited
liability company, association, trust, unincorporated organization, Governmental
Authority or other entity.
"Primarily Used in the Business" or "Held for Primary Use in the
Business" means used primarily or held for use primarily in or by the Business
or in connection with development, design, manufacturing, marketing,
distribution and/or selling of the Products, or having characteristics, features
or attributes that have primary application to the Business or to the
development, design, manufacturing, marketing, distribution and/or selling of
the Products; provided that any asset or property expressly identified as an
Excluded Asset hereunder shall not be deemed to be Primarily Used in the
Business or Held for Primary Use in the Business.
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"Product Inventory" means (i) all finished Products, (ii) all goods
inventory and work-in-process of Seller and Parent Primarily Used in the
Business, and (iii) any and all related components, labeling, packaging or other
materials or supplies; provided that the Product Inventory shall not include any
Excluded Inventory.
"Product Liability" means Damages to the extent such arise out of a
breach of any express or implied product warranty, strict liability in tort,
negligent design, testing or manufacture of product, negligent provision of
services, product recall or any other allegation of liability or obligation
arising from the design, manufacture, testing, packaging, labeling (including
instructions for use), advertising, marketing, distribution or sale of any
Product (whether for clinical trial purposes, commercial use or otherwise).
"Product Specifications" means any and all Information that is germane
or related to, or which provides guidance or instructions as to the design,
development, manufacture, repair, enhancement, commercialization, marketing,
sale, labeling, distribution and/or testing of, the Products and, as applicable,
the Acquired Assets, and all copies and tangible embodiments of the foregoing
(in whatever form or medium).
"Purchased Intellectual Property" means, collectively, the Owned
Intellectual Property and the Licensed Intellectual Property (in each case,
exclusive of Retained Seller Intellectual Property), and the Intellectual
Property rights granted to Buyer pursuant to the License Agreement and the
Sublicense Agreement.
"Records" means and includes all of the following records of Seller
and/or Parent relating to any Product, Acquired Asset or otherwise Primarily
Used in the Business (in each case whether such materials are evidenced in
writing, electronically or otherwise): (i) all business records (including
purchasing records and regulatory compliance records (including each DMR file));
(ii) all Regulatory Correspondence; (iii) all Regulatory Applications (together
with all supporting and background documentation); (iv) all submissions and
reports to the FDA, any Notified Body or other Governmental Authority (including
all supporting and background documentation); (v) manuals and procedures for
assuring compliance with any applicable Device Regulation, CE technical files
and all other records and materials necessary to comply with an applicable
Device Regulation or similar requirements of third party auditors; (vi) all data
and information relating to any preclinical, clinical and nonclinical testing or
studies (post-marketing or otherwise) conducted, funded or sponsored by Seller,
Parent or any Seller Affiliate involving Products or Acquired Assets, including
informed consents, case report forms, and all other records related to those
trials conducted at the University of Alabama at Birmingham, Dartmouth-▇▇▇▇▇▇▇▇▇
Medical Center, and all other studies; (vii) risk management records; (viii)
documents, correspondence, studies, reports and all other books, ledgers, files
and records of every kind; (ix) tangible data; (x) all vendor, supplier and
service provider lists (including a description of the underlying commercial
agreements or arrangements with such vendors, suppliers or service providers);
(xi) promotional literature and advertising materials in physical form and
camera-ready artwork with support data; (xii) catalogs; (xiii) research
material; (xiv) statistical information; (xv) technical information; (xvi)
design history files, complaints and MDRs; (xvii) correction and removal
reports; (xviii) corrective and preventive action reports; (xix) written
memoranda or records documenting decisions not to file a Regulatory Application;
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(xx) other product development records related to past, current or prospective
research and development projects; and (xxi) blueprints, technology, technical
designs, drawings, specifications and other books, records and files used or
held for use by or on behalf of Seller, Parent or any other Seller Affiliate.
"Regulated Product" means any Product or component of a Product, the
development, testing, manufacturing, packaging, labeling, marketing,
distribution, commercialization, sale or human use (including human research,
investigation or clinical use) of which is regulated by FDA or any other
Governmental Authority, including any medical device, as such term is defined in
21 U.S.C. ss. 321(h) (Section 201(h) of the FDCA) or Article 1.2 of the
Directive.
"Regulatory Applications" means all investigational device
applications, 510(k) pre-market notifications, pre-market approval applications,
supplemental pre-market approval applications, master files, and any other
permits, approvals, registrations, licenses, grants, authorizations, exemptions,
orders or consents relevant to any Regulated Product or required under any
Device Regulation (including all ▇▇ ▇▇▇▇▇ and any applications or assessments to
obtain marking authorization outside of the United States), whether pending or
approved or cleared by a relevant Governmental Authority, including all
supplements or amendments thereto and all Information submitted with or
incorporated by reference therein.
"Regulatory Correspondence" means any and all of the following: all
Regulatory Applications, and all other applications, registrations, approvals,
concurrences and filings with any Governmental Authority concerning or related
to any Regulated Product or Device Regulation; and any other submissions,
correspondence, or other communications relating to any Regulated Product or any
Device Regulation, including any correspondence or communication to or from the
FDA, any state counterpart, any Notified Body, or any other Governmental
Authority (in each case together with all supporting and background
documentation, and, with respect to FDA filings and submissions, identifying the
type of the filing or submission (whether under a Regulatory Application
procedure or otherwise)), including all warning letters, all vigilance reports,
all MDRs, all correspondence relating to clinical activities, all responses to
FDA audits, all CE technical or CE ▇▇▇▇ files, all facilities registration
documentation and all device listing documentation.
"Seller Affiliate" means any Affiliate of Seller.
"Spire Person" means any employee, agent, contactor, investigator,
consultant, representative or adviser of Seller, Parent or any other Seller
Affiliate.
"Tax" or "Taxes" means all United States federal, state, local, or
foreign income, profits, estimated, franchise, gross receipts, net receipts,
capital, capital stock, net worth, sales, use, withholding, turnover, goods and
services, value added, ad valorem, registration, general business, employment,
social security, disability, occupation, real property, personal property
(tangible and intangible), recording, stamp, transfer, conveyance, severance,
production, excise, emergency excise, alternative or add-on minimum, payroll,
unemployment insurance, premium, environmental, windfall profit, custom, duty,
documentary, information reporting, back-up withholding, and other
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taxes, withholdings, duties, levies, imposts, license and registration fees, and
other similar charges and assessments (including all fines, penalties, and
additions attributable to or otherwise imposed, assessed or collected on or with
respect to any such taxes, charges, fees, levies or other assessments, and all
interest thereon, any liability arising pursuant to the application of Treasury
Regulation section 1.1502-6 or any similar provision of any applicable state,
local or foreign Tax Law, and any liability for the unpaid Taxes of any other
Person as a transferee or successor, by contract, or otherwise) imposed,
assessed or collected by or on behalf of any Taxing Authority.
"Taxing Authority" means any Governmental Authority exercising any
authority to impose, regulate or administer the imposition of Taxes.
"Tax Return" means any return, statement, report, filing, estimate,
declaration, claim for refund, information return or statement, or form,
including in each case any amendments thereto, filed or required to be filed
with any Taxing Authority.
"Trademarks" means all registered and unregistered trademarks, service
marks, trade names, Domain Names, trade dress and logos, including all goodwill
associated therewith, and all applications, registrations, and renewals in
connection therewith.
"Trade Secrets" means all trade secrets and confidential know-how,
prototypes, technical and non-technical data and information, including
algorithms, formulae, models, inventions, discoveries and methodologies whether
or not patentable or reduced to practice and other confidential business
information, the disclosure of which to any other Person would reasonably be
expected to harm the competitive position of the owner thereof, or provide
competitive assistance to such Person. Until such time as any particular Patent
has been published in accordance with the terms of a Patent application or such
Patent application has been published, the term "Trade Secret" shall be deemed
to include all Disclosures of Inventions disclosed in such Patent application.
"Treasury Regulations" means the U.S. treasury regulations promulgated
pursuant to the Code.
1.02 Other Defined Terms. The following terms are defined in the
sections indicated.
Acquired Assets...........................................2.01(b)
Agreement.................................................preamble
Apportioned Obligations...................................6.08(a)
Assumed Contracts.........................................2.01(b)(x)
Assumed Liabilities.......................................2.03
Bard Indemnified Parties..................................7.02
Business..................................................recitals
Business Insurance Policies...............................4.20
Buyer.....................................................preamble
Buyer Parties.............................................6.18(a)
Closing...................................................3.01
8
Closing Date..............................................3.01
Closing Inventory Statement...............................2.06(e)
Closing Payment...........................................2.05(a)
Confidentiality Agreement.................................6.06(b)
Disclosure Supplement.....................................6.01(f)
Dispute Notice............................................2.06(f)
Estimated Inventory Amount................................2.06(c)
Estimated Inventory Statement.............................2.06(b)
Excluded Assets...........................................2.02
Excluded Liabilities......................................2.04
Final Inventory...........................................2.06(g)
Financial Information.....................................4.16(a)
Inbound Intellectual Property License.....................4.13(b)
Independent Firm..........................................2.06(g)
Intellectual Property Licenses ...........................4.13(b)
Inventory Amount..........................................2.06(a)
Inventory Count...........................................2.06(d)
Inventory Deficiency......................................2.06(c)
Inventory Excess..........................................2.06(c)
▇▇▇▇▇ Patent..............................................6.18(a)
License Agreement.........................................3.02(b)
Licensed Intellectual Property............................4.13(b)
Litigated Patent..........................................7.05(b)
Material Contracts........................................4.07(b)
Notice Date...............................................2.06(g)
Notice Period.............................................7.04(a)(ii)
Notified Body Letters.....................................3.02(n)
Outbound Intellectual Property License....................4.13(b)
Owned Intellectual Property...............................4.13(a)
Parent....................................................preamble
Participants..............................................4.13(e)
Permits...................................................4.08(a)
Permitted Claim...........................................7.05(b)
Product Data..............................................4.14(a)
Products..................................................2.01(b)(i)
Proposed Adjustment.......................................2.06(f)
Purchase Price............................................2.05
Registered Marks..........................................4.13(a)
Retained Names............................................6.09(c)
Retained Seller Intellectual Property ....................2.02(g)
Seller....................................................preamble
Seller Disclosure Schedules...............................6.01(f)
Seller Parties............................................6.18(a)
Seller Recipients.........................................6.06
Semi-Exclusive License....................................4.24
9
Signing Inventory Statement...............................2.06(a)
Spire Indemnified Parties.................................7.03
Strategic Transaction.....................................6.01(e)
Sublicense Agreement......................................3.02(c)
Tax Contest...............................................7.04(b)
Third Party Claim.........................................7.04(a)(i)
Third Party Claim Notice..................................7.04(a)(i)
Transition Services.......................................6.03(b)
Transfer Taxes............................................6.08(b)
ARTICLE II
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PURCHASE AND SALE OF ASSETS;
ASSUMPTION OF LIABILITIES; PURCHASE PRICE
2.01 Purchase and Sale.
(a) Subject to the terms and conditions of this Agreement, at the
Closing, Seller and Parent shall sell, convey, assign, transfer and deliver to
Buyer, and Buyer shall purchase, assume and acquire from Seller and Parent, all
right, title and interest of Seller and Parent in and to the Acquired Assets,
free and clear of all Encumbrances.
(b) "Acquired Assets" means all of Seller's, Parent's and the
other Seller Affiliates' rights, assets and properties of every kind and
description Held for Primary Use in the Business, whether tangible or
intangible, wherever located and whether or not carried on the books and records
of Seller, Parent or any other Seller Affiliate, including Seller's, Parent's
and the other Seller Affiliates' right, title and interest in, to and under the
following:
(i) the coated and uncoated hemodialysis catheter products and
related catheter kits, accessory products and coatings used or intended or held
for use by Seller, Parent or any other Seller Affiliate in the field of
hemodialysis therapy, including those products, catheter kits, accessory
products and coatings that are set forth on Schedule 2.01(b)(i), and any and all
line extensions, modifications, improvements, additions, successors thereto and
replacements therefor, in each case, that are owned by or licensed to Seller,
Parent or any other Seller Affiliate at the Closing (collectively, "Products");
(ii) all Purchased Intellectual Property;
(iii) all customer lists, supplier lists, pricing and cost
information, and business and marketing plans, in each case, related to the
Acquired Assets, the Business and/or the Products, or otherwise Held for Primary
Use in the Business;
(iv) all Records solely relating to the Products, the Acquired
Assets and/or the Business, and photocopies of all other Records Primarily Used
in the Business;
(v) all Product Specifications to the extent owned by Seller
and/or
10
Parent, and otherwise all transferable rights therein;
(vi) all Product Inventory;
(vii) all income, royalties, damages and payments due or payable
following the Closing Date relating to any of the Purchased Intellectual
Property, including damages and payments for past, present or future
infringement, misappropriation, dilution or other violation thereof, the right
to ▇▇▇, recover and retain damages for past, present or future infringement,
misappropriation, dilution or other violation thereof, and any and all
corresponding rights that, now or hereafter, may be secured, excluding any
income, royalties, damages and payments related to the Retained Seller
Intellectual Property, which rights shall be governed by the terms of the
License Agreement or the Sublicense Agreement, as the case may be;
(viii) all rights to defend against claims made that any rights
herein conveyed to Buyer to the Purchased Intellectual Property infringes,
misappropriates, dilutes or otherwise violates the intellectual property rights
of any Person, excluding any rights related to the Retained Seller Intellectual
Property, which rights shall be governed by the terms of the License Agreement
or the Sublicense Agreement, as the case may be;
(ix) all rights to prosecute all Patent applications and maintain
all Patents included in the Purchased Intellectual Property, excluding any
rights related to the Retained Seller Intellectual Property, which rights shall
be governed by the terms of the License Agreement or the Sublicense Agreement,
as the case may be;
(x) all purchase orders and commitments of customers for Products
that have been issued in the ordinary course of business consistent with past
practice and outstanding and unfulfilled as of the Closing Date, all purchase
orders and commitments to vendors for Product Inventory that have been entered
into in the ordinary course of business consistent with past practice and
outstanding and unfulfilled as of the Closing Date, and all Contracts that are
set forth in Schedule 2.01(b)(x), and all rights under each of them
(collectively, the "Assumed Contracts");
(xi) Seller's and Parent's transferable rights under all Permits,
except for the Excluded Permits identified on Schedule 4.08(a);
(xii) all warranties, guaranties and indemnities by any
manufacturer or supplier to the extent related to any Product or any Acquired
Asset, and all rights to causes of action, lawsuits, judgments, claims and
demands of any nature whether ▇▇▇▇▇▇ or inchoate, known or unknown, contingent
or non-contingent, available to or being pursued by Seller or Parent or
otherwise related to any Product, any Acquired Asset or the Business, whether
arising by way of counterclaim or otherwise, including the right to recover all
proceeds, settlements and damages therefrom;
(xiii) all equipment listed on Schedule 2.01(b)(xiii);
(xiv) all prepaid expenses, credits, deferred charges, advance
payments, deposits and other prepaid items of Seller and Parent, to the extent
related to any Product or
11
Acquired Asset or otherwise to the extent arising out of the operation of the
Business, and, in each case, any and all rights relating thereto;
(xv) all rights of Seller, Parent and the other Seller Affiliates
to enforce any agreement with any employee or contractor of such Person with
respect to Owned Intellectual Property; and
(xvi) all goodwill, moral rights and other general intangible
properties and assets Primarily Used in the Business, including those assets and
properties listed on Schedule 2.01(b)(xvi).
2.02 Excluded Assets. Anything herein to the contrary notwithstanding,
Buyer shall not acquire any interest in the following assets of Seller or Parent
(whether or not Primarily Used in the Business), all of which shall be retained
by Seller or Parent, as applicable (collectively, the "Excluded Assets") and
shall be excluded from the definition of Acquired Assets:
(a) all real property, whether owned or leased;
(b) the cash and cash equivalents, bank accounts and other
depository accounts of Seller, Parent and the Business;
(c) all accounts receivable outstanding as of the Closing Date;
(d) all equipment, other than the equipment listed on Schedule
2.01(b)(xiii);
(e) all books, records and marketing materials of Seller and/or
Parent not constituting Records solely related to the Products, the Acquired
Assets or the Business; provided that Buyer shall be entitled to receive
photocopies of all other Records Primarily Used in the Business;
(f) all Contracts that are not Assumed Contracts;
(g) all Intellectual Property of Parent or Seller that is the
subject of the licenses granted under and pursuant to the License Agreement or
the Sublicense Agreement except to the extent of the licenses granted to Buyer
therein and all other Intellectual Property of Parent or Seller identified as an
Excluded Asset set forth in Schedule 2.02(g) (collectively, "Retained Seller
Intellectual Property");
(h) all rights in connection with, and assets held with respect
to, any Benefit Plans and maintained by any Seller, Parent or any Seller
Affiliate, except for those independent contractor agreements constituting
Assumed Contracts hereunder and identified in Schedule 2.01(b)(x);
(i) all employment and consulting agreements and all personnel
records and other records relating to the employees of the Business, except for
those consulting agreements constituting Assumed Contracts hereunder and
identified in Schedule 2.01(b)(x);
12
(j) all insurance policies, including the Business Insurance
Policies;
(k) any capital stock of any Affiliate of Seller or Parent;
(l) all rights of Seller and Parent under this Agreement,
including the proceeds of the sale contemplated herein and other payments to
Seller contemplated hereby (or under any other agreement between Seller and
Buyer);
(m) all Tax refunds and Tax deposits of Seller and Parent with
respect to the Acquired Assets and the Business for any taxable period ending on
or prior to the Closing Date;
(n) all prepaid expenses, credits, deferred charges, advance
payments, deposits and other prepaid items of Seller and Parent, to the extent
solely related to any Excluded Asset and, in each case, any and all rights
relating thereto; and
(o) all other assets and properties of Seller and Parent not
Primarily Used or Held for Primary Use in the Business, including those assets
and properties set forth on Schedule 2.02.
2.03 Assumption of Liabilities. Subject to the terms and conditions of
this Agreement, at the Closing, Buyer shall assume, and agree to pay, perform,
fulfill and discharge, all obligations of Seller or Parent arising under the
Assumed Contracts, in each case, arising and to be performed following the
Closing Date, other than any such obligations relating to or arising from (i) a
breach under or default of any such Assumed Contract or failure to timely
perform under any such Assumed Contract, in each case, occurring on or prior to
the Closing Date, or (ii) events or conditions occurring on or prior to the
Closing, which after notice or lapse of time or both would constitute a default
or breach by Seller, Parent, or any Seller Affiliate (the "Assumed
Liabilities").
2.04 Excluded Liabilities. The Parties agree that, except for the
Assumed Liabilities, Buyer will not assume or be responsible for the payment or
assumption of any other liabilities or obligations of any kind of Seller,
Parent, any other Seller Affiliate or the Business (collectively, the "Excluded
Liabilities"), including any and all liabilities and obligations relating to:
(a) all Benefit Plans of Seller, Parent or any Seller Affiliate;
(b) any current or former employees, directors, or officers of
Seller, Parent, any other Seller Affiliate or the Business;
(c) the Excluded Taxes;
(d) any Indebtedness of Seller, Parent or any other Seller
Affiliate;
(e) all Actions relating to or involving Seller, Parent, any other
Seller Affiliate, the Products, the Acquired Assets or the Business, existing on
or prior to the Closing
13
Date, and all Actions with respect to Seller's, Parent's or any other Seller
Affiliate's conduct of its business on or after the Closing Date;
(f) any liabilities or obligations of the Business, on the one
hand, owed to Seller, Parent or any other Seller Affiliate, on the other hand;
(g) any liabilities arising in connection with the negotiation,
execution and delivery of this Agreement and the other agreements contemplated
hereby (other than as set forth herein or therein); and
(h) all liabilities with respect to the Excluded Assets.
The Excluded Liabilities are, and shall at all times remain, the liabilities of
Seller, Parent and the Seller Affiliates. Seller and Parent hereby covenant to
discharge in full in a timely manner all of the Excluded Liabilities.
2.05 Purchase Price; Closing Payment. The purchase price for this
transaction is Fifteen Million Dollars ($15,000,000) (the "Purchase Price"),
which amount is subject to adjustment as set forth in Section 2.06 below. The
Purchase Price shall be paid as follows:
(a) Fourteen Million Nine Hundred Thousand Dollars ($14,900,000)
of the Purchase Price shall be paid by Buyer directly to Seller and Parent at
the Closing (as such amount may be adjusted pursuant to Section 2.06 below, the
"Closing Payment"); and
(b) One Hundred Thousand Dollars ($100,000) of the Purchase Price
shall be paid by Buyer directly to those Persons listed in attached Schedule
3.02(e), as more particularly set forth in, and as consideration for the
execution and delivery by such Persons of, those non-competition agreements
contemplated by Section 3.02(e) below.
The Closing Payment shall be payable at Closing by wire transfer or delivery of
other immediately available funds to one or more accounts designated by Seller
and Parent.
2.06 Price Adjustment Related to Product Inventory. The Purchase Price
payable under this Agreement shall be adjusted as follows:
(a) Within five (5) business days prior to the date of this
Agreement, Seller and Parent shall have delivered to Buyer a good faith estimate
of the statement of the Product Inventory as of such date, determined in a
manner consistent with Seller's historical accounting methods, policies and
practices (the "Signing Inventory Statement"), which shall indicate the
aggregate value (the "Inventory Amount") of such Product Inventory on an
itemized basis.
(b) Within five (5) business days prior to the Closing Date,
Seller and Parent shall deliver to Buyer a good faith estimate of the statement
of the Product Inventory as of the Closing Date, determined in a manner
consistent with Seller's historical accounting methods, policies and practices
(the "Estimated Inventory Statement"), which shall indicate the Inventory Amount
of such Product Inventory on an itemized basis.
14
(c) If the Inventory Amount set forth in the Estimated Inventory
Statement (the "Estimated Inventory Amount") is (i) less than the Inventory
Amount set forth in the Signing Inventory Statement (the amount of any such
deficiency referred to as the "Inventory Deficiency"), the Closing Payment shall
be reduced by the absolute value of such Inventory Deficiency, (ii) equal to the
Inventory Amount set forth in the Signing Inventory Statement, there shall be no
adjustment made to the Closing Payment, or (iii) greater than the Inventory
Amount set forth in the Signing Inventory Statement (the amount of any such
excess referred to as the "Inventory Excess"), there shall be no adjustment made
to the Closing Payment, provided that Buyer shall issue a purchase order to
Seller in respect of the Product Inventory subject to such Inventory Excess, and
Seller shall render an invoice to Buyer in the amount of the Inventory Excess
which shall be payable by Buyer on customary terms.
(d) Within ten (10) days following the Closing Date,
representatives of the Parties shall conduct a joint physical inspection and
count of all Product Inventory located at the premises of Seller, Parent and
Argon Medical Devices and jointly prepare a written statement confirming the
results of such joint physical count (the "Inventory Count"). The Inventory
Count shall be conclusive and binding upon the Parties.
(e) Within thirty (30) days following the Closing, Buyer shall
prepare and deliver to Seller and Parent an unaudited statement of the Product
Inventory of the Business as of the Closing Date (the "Closing Inventory
Statement"). The Closing Inventory Statement shall reflect the results of the
Inventory Count, shall be prepared in a manner consistent with Seller's
historical accounting methods, policies and practices, and shall specify the
exact dollar amount of any difference between the Inventory Amount set forth
therein and the Estimated Inventory Amount and the basis for any such
difference.
(f) Within thirty (30) days after Seller's and Parent's receipt of
the Closing Inventory Statement, Seller and Parent shall have the right to
advise Buyer in writing (a "Dispute Notice") of any disagreement with the
Closing Inventory Statement, together with a written indication of any
adjustment ("Proposed Adjustment") that Seller and Parent in good faith believe
are necessary to be made to the Inventory Amount, specifying the exact dollar
amount of such Proposed Adjustment and the basis for requesting any such
Proposed Adjustment. At the end of such period for delivery of a Dispute Notice,
the Parties may not introduce any additional disagreements with any item on the
Closing Inventory Statement, and any items in the Closing Inventory Statement
that are not then disputed in any Dispute Notice shall be deemed agreed by the
Parties and shall be final and binding. If Seller and Parent timely submit a
Dispute Notice, the Parties shall promptly meet and make a good faith effort to
resolve any disagreements between them concerning any Proposed Adjustment, and
if the Parties reach agreement on the resolution of such dispute, such Proposed
Adjustment (with any changes agreed by the Parties) shall be final and binding.
If Seller and Parent do not submit any Dispute Notice within the thirty (30) day
period pursuant to this Section 2.06(f), then the Closing Inventory Statement
shall be deemed the Final Inventory (as defined below).
(g) If any Proposed Adjustment in dispute cannot be so resolved
within twenty (20) days after the date of the Dispute Notice, the Parties agree
to promptly engage the services of a mutually acceptable independent accounting
firm (the "Independent Firm") to
15
review and resolve all such Proposed Adjustments on which the Parties are unable
to agree. The Independent Firm shall only review disputed Proposed Adjustments
and shall not have the ability to review any items not in dispute in the Dispute
Notice or otherwise previously agreed by the Parties. Not later than ten (10)
days after engaging the Independent Firm (the "Notice Date"), Buyer, on the one
hand, and Seller and Parent, on the other hand, each shall present or cause to
be presented to the Independent Firm in writing, and the Independent Firm shall
review and consider, their respective positions with regard to the disputed
Proposed Adjustments together with such supporting documentation, calculation or
written statements as any Party may wish to present. The Parties shall use their
respective commercially reasonable efforts to cause the Independent Firm to
render its decisions on the disputed Proposed Adjustments as soon as it is
reasonably practicable but no later than thirty (30) days after the Notice Date,
including by promptly complying with all reasonable requests of the Independent
Firm for information, papers, books, records and access to relevant personnel
and outside accountants of the Parties. The determination of the Independent
Firm reached in accordance with this Section 2.06(g) shall be binding on the
Parties with respect to changes, if any, to be made to the Proposed Adjustments.
The final Inventory Amount determined pursuant to Section 2.06(f) and (g) is
referred to herein as the "Final Inventory." If Seller and Parent shall have
submitted a Dispute Notice pursuant to Section 2.06(f), then the final Inventory
Amount as agreed to by the Parties or determined by the Independent Firm shall
be deemed the Final Inventory.
(h) If the Parties submit any unresolved disagreements to the
Independent Firm for resolution as provided herein, Seller and Parent, on the
one hand, and Buyer, on the other hand, shall share responsibility for the fees
and expenses of the Independent Firm as follows: (i) if the Independent Firm
resolves all of the unresolved disagreements in favor of either Seller and
Parent, on the one hand, or Buyer, on the other hand, the other Party or Parties
shall be responsible for all of the fees and expenses of the Independent Firm;
or (ii) if the Independent Firm resolves certain of the unresolved disagreements
in favor of Seller and Parent, on the one hand, or Buyer, on the other hand, and
the rest of the unresolved disagreements in favor of the other Party or Parties,
each Party shall be responsible for a proportionate amount of the fees and
expenses of the Independent Firm based on the dollar amount of the unresolved
disagreements resolved against such Party compared to the total dollar amount of
all unresolved disagreements originally submitted to the Independent Firm.
(i) If the Final Inventory is: (i) less than the Estimated
Inventory Amount, Seller and Parent, jointly and severally, shall pay to Buyer
the absolute value of the difference between the Final Inventory and the
Estimated Inventory Amount (which payment shall include refunds of any and all
amounts paid by Buyer in respect of a purchase order that was issued in
connection with any Inventory Excess, as applicable) within ten (10) days after
the determination thereof; (ii) equal to the Estimated Inventory Amount, no
Party shall be required to make any additional payment to any other Party as a
result thereof; or (iii) greater than the Estimated Inventory Amount, Buyer
shall pay to Seller the absolute value of the difference between the Final
Inventory and the Estimated Inventory Amount within ten (10) days after the
determination thereof; provided that to the extent that any payment required to
be made by Buyer pursuant to this Section 2.06(i)(iii) causes the Purchase Price
to exceed $15,000,000, Buyer shall issue a purchase order to Seller in respect
of the Product Inventory subject to such excess and Seller shall render an
invoice to Buyer in the amount of such excess which shall be payable by Buyer
16
on customary terms.
2.07 Allocation of Purchase Price.
(a) Buyer shall prepare an allocation of the Purchase Price and
the Assumed Liabilities in accordance with Section 1060 of the Code, which
allocation shall be binding on Seller and Parent. Buyer shall deliver such
allocation to Seller and Parent within sixty (60) days after the Closing Date.
The Parties agree to act in accordance with the computations and allocations as
determined pursuant to this Section 2.07 in all relevant Tax Returns or filings,
including any Tax Returns, forms or reports required to be filed pursuant to
Section 1060 of the Code, the Treasury Regulations promulgated thereunder or any
provisions of Law, and to cooperate in the preparation of any such forms and to
file such forms in the manner required by applicable Law. Seller and Parent
shall timely and properly prepare, execute, file and deliver all such documents
or other information as Buyer may reasonably request to prepare such allocation.
To the extent that the Purchase Price is adjusted pursuant to the terms of this
Agreement, the allocation shall be revised on a dollar-for-dollar basis to
reflect such adjustment.
(b) Notwithstanding anything to the contrary set forth in Section
2.07(a) above, Buyer, Seller and Parent acknowledge and agree that Buyer will
not allocate an amount to Product Inventory delivered to Buyer at the Closing in
excess of One Million Two Hundred Thousand Dollars ($1,200,000) without the
prior written consent of Seller, which consent shall not be unreasonably
withheld (provided that the Parties acknowledge and agree that Seller's failure
to consent shall be deemed to be unreasonable unless such failure is supported
by a third-party appraisal of such Product Inventory, in which case, the
unresolved valuation of such Product Inventory shall be promptly submitted to a
jointly-retained third party accounting firm for determination, which shall be
final and binding on Buyer, Seller and Parent). The cost and expenses of such
third party accounting firm shall be borne equally by Buyer, on the one hand,
and Seller and Parent, on the other hand.
2.08 Withholding. Buyer shall be entitled to deduct and withhold or
cause to be deducted and withheld from amounts otherwise payable to any person
pursuant to this Agreement such amounts as it is required to deduct and withhold
with respect to such payments under any provision of federal, state, local or
foreign Tax Laws. Any amounts so deducted and withheld will be treated for all
purposes of this Agreement as having been paid to the person in respect of which
such deduction and withholding was made.
ARTICLE III
-----------
CLOSING
3.01 Time and Place. The closing of the transactions contemplated by
this Agreement (the "Closing") shall take place at such location as the Parties
may designate in writing at 10:00 a.m. (New York City time) on the third
business day following the satisfaction or waiver of the conditions set forth in
Article VIII, or at such other time and date as the Parties may agree. The
"Closing Date" shall be the date upon which the Closing occurs.
17
3.02 Deliveries by Seller and Parent. At the Closing, Seller and Parent
shall deliver to Buyer the following:
(a) the ▇▇▇▇ of sale and assignment and assumption agreement,
substantially in the form attached as Exhibit A, duly executed by Seller and
Parent;
(b) the license agreement, substantially in the form attached as
Exhibit B (the "License Agreement"), duly executed by Seller and Parent;
(c) the sublicense agreement, substantially in the form attached
as Exhibit C the ("Sublicense Agreement"), duly executed by Seller, Parent and
Corline Systems AB;
(d) the consulting agreement, substantially in the form attached
as Exhibit D, duly executed by ▇▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇;
(e) the non-competition agreements, substantially in the form
attached as Exhibit E, duly executed by those Persons listed in attached
Schedule 3.02(e);
(f) true, complete and correct copies of all consents set forth on
Schedule 4.04, to the extent not waived in writing by Buyer;
(g) the patent assignments, substantially in the form attached as
Exhibit F, in recordable form and duly executed by Seller or Parent, as
applicable;
(h) the copyright assignments, substantially in the form attached
as Exhibit G, in recordable form and duly executed by Seller or Parent, as
applicable;
(i) the trademark assignments, substantially in the form attached
as Exhibit H, in recordable form and duly executed by Seller or Parent, as
applicable;
(j) a copy of a certificate of the Secretary of State of the
jurisdiction of incorporation of each of Seller and Parent, dated on or about
the Closing Date, certifying that such Person is duly organized and in good
standing or presently subsisting under the Laws of the State of the jurisdiction
of its incorporation;
(k) a certificate, dated the Closing Date, executed by the
Secretary or Assistant Secretary of each of Seller and Parent, certifying the
incumbency of each officer executing this Agreement or any other documents and
instruments to be executed and delivered pursuant hereto on behalf of such
Person, and attached to which are copies of all resolutions of the board of
directors of Seller and Parent and the stockholder of Seller authorizing the
transactions contemplated hereby or otherwise relating to this Agreement and the
transactions contemplated hereby, certified as being in full force and effect on
the Closing Date;
(l) releases (in recordable forms), pay-off letters and UCC-3
termination statements (in recordable form) from any Person having an
Encumbrance on any
18
Acquired Assets, or such other evidence of termination of such Encumbrance as is
acceptable to Buyer;
(m) all documents and certificates, in form and substance
reasonably satisfactory to Buyer, that are required by any Taxing Authority to
relieve Buyer of any liability for unpaid Taxes of Seller, Parent, or any Seller
Affiliate or of any obligation to withhold any portion of the consideration paid
to Parent or Seller pursuant to this Agreement;
(n) copies of the letter(s), in the form(s) attached as Exhibit I,
to be sent by Seller and/or Parent upon the Closing to applicable Notified
Bodies notifying each such Notified Body of the transfer of the rights to the
Regulatory Applications relating to the Products (the "Notified Body Letters");
(o) a certificate, dated the Closing Date and executed by the
Chief Executive Officer or President of each of Seller and Parent, certifying
that each of the conditions specified in Section 8.01(a) through (e) is
satisfied in all respects;
(p) true, correct and complete copies of all Records; and
(q) such other documents and instruments as Buyer may reasonably
request, including any other instruments of transfer and assignment as shall be
necessary to vest in Buyer all right, title and interest in and to the Acquired
Assets free and clear of any and all Encumbrances.
3.03 Deliveries by Buyer. At the Closing, Buyer shall deliver to Seller
and Parent the following:
(a) the Closing Payment, payable in accordance with Section 2.05;
(b) the ▇▇▇▇ of sale and assignment and assumption agreement,
substantially in the form attached as Exhibit A, duly executed by Buyer;
(c) the License Agreement, duly executed by Buyer or an Affiliate
of Buyer, as applicable;
(d) the Sublicense Agreement, duly executed by Buyer or an
Affiliate of Buyer, as applicable;
(e) a certificate, dated the Closing Date, executed by the
Secretary or Assistant Secretary of Buyer, certifying the incumbency of each
officer executing this Agreement or any other documents and instruments to be
executed and delivered pursuant hereto on behalf of such Person;
(f) a certificate, dated the Closing Date and executed by an
executive officer of Buyer, certifying that each of the conditions specified in
Section 8.02(a) and (b) is satisfied in all respects; and
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(g) such other documents and instruments as Seller and Parent may
reasonably request and Buyer can reasonably and lawfully provide.
ARTICLE IV
----------
REPRESENTATIONS AND WARRANTIES OF SELLER AND PARENT
Seller and Parent hereby represent and warrant, jointly and severally,
to Buyer as follows, subject in each case to such exceptions as are specifically
set forth herein and in the attached Schedules of Seller and Parent:
4.01 Organization; Qualification.
(a) Each of Seller and Parent is a corporation duly incorporated,
validly existing and in good standing under the Laws of the jurisdiction of its
incorporation with the full corporate power and authority to conduct its
business as now conducted and to own and lease its assets and properties.
(b) Each of Seller and Parent is duly qualified or licensed as a
foreign corporation to do business, and is in good standing, in each
jurisdiction where the character of the assets and properties owned, leased or
operated by it or the nature of its activities makes such qualification or
licensing necessary, except where the failure to be so qualified or licensed
individually or in the aggregate, could not reasonably be expected to have a
Material Adverse Effect.
4.02 Power and Authority. Each of Seller and Parent has the full power
and authority to execute and deliver this Agreement and perform their respective
obligations hereunder and under the other agreements and instruments to be
executed and delivered by each such Person in connection with the transactions
contemplated hereby and thereby. Each of Seller and Parent has taken all
necessary action (corporate or otherwise) to authorize the execution and
delivery of this Agreement and such other agreements and instruments and the
consummation of the transactions contemplated hereby and thereby. This Agreement
is, and the other agreements and instruments to be executed and delivered by
Seller and Parent, as applicable, in connection with the transactions
contemplated hereby and thereby will be (when executed and delivered by all of
the Parties thereto), the legal, valid and binding obligations of each such
Person, as applicable, enforceable in accordance with their respective terms,
except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or other similar Laws now or hereafter in
effect affecting the enforcement of creditors' rights generally. Neither Seller
nor Parent is in default under or in violation of any provision of its charter
or bylaws.
4.03 No Violation. Neither the execution and delivery of this Agreement
or the other documents and instruments to be executed and delivered pursuant
hereto, nor the consummation of the transactions contemplated hereby or thereby
(i) violates any provision of the certificate of incorporation, bylaws or other
constitutive documents of Seller or Parent, (ii) violates or is in conflict with
(a) any applicable Law or (b) any Order directed to
20
Seller or Parent or affecting any of their assets or properties, or (iii) except
as set forth on Schedule 4.03(iii), violates or conflicts with or constitutes a
default (or an event that, with notice or lapse of time or both, would
constitute a default) under or results in the termination of, or gives any
Person the right to terminate, or accelerates the performance required by, any
Material Contract or any term or provision thereof, or results in the creation
of an Encumbrance upon any of the Acquired Assets or any other asset or property
of Seller or Parent.
4.04 Consents. Except as set forth on Schedule 4.04, no authorization,
consent, approval, order or declaration of, registration or filing with or
notice to any Governmental Authority or other Person is necessary for the
execution and delivery of this Agreement or any other agreement or document to
be delivered by Seller or Parent or the consummation by any such Person of the
transactions contemplated hereby or thereby.
4.05 Title to Acquired Assets. Except as set forth on Schedule 4.05(a),
Seller and Parent collectively have good, valid and marketable title to all of
the Acquired Assets, and, except as set forth on Schedule 4.05(b), Seller and
Parent collectively have the full right to sell, transfer and assign all of the
Acquired Assets to Buyer, free and clear of all Encumbrances. Following the
Closing, Buyer will (i) except as set forth on Schedule 4.05(c), be the lawful
owner of, and have good, valid and marketable title to, the Acquired Assets,
free and clear of all Encumbrances, and (ii) except as set forth on Schedule
4.05(d), have valid written licenses to use all Licensed Intellectual Property
on terms and conditions that Seller and/or Parent enjoyed immediately prior to
the Closing. All of the tangible assets and property included in the Acquired
Assets, whether owned or leased, have no material defects, have been maintained
in accordance with normal industry practice and are in good repair and operating
condition, ordinary wear and tear excepted.
4.06 Litigation. Except as set forth on Schedule 4.06, there are no
Actions pending or, to Seller's Knowledge, threatened against or affecting the
Business, Seller, Parent, any other Seller Affiliate or any of their respective
assets or properties (including the Acquired Assets) nor, to Seller's Knowledge
(without a duty of inquiry), is there any reasonable basis for any such Action
against Seller, Parent or any other Seller Affiliate affecting the Business or
the Acquired Assets. There is no Order binding upon Seller, Parent or any other
Seller Affiliate (whether relating to any Acquired Asset, the Business, the
Assumed Liabilities or otherwise) that could reasonably be expected to interfere
with Seller's or Parent's ability to consummate this Agreement or the
transactions contemplated hereby or adversely affect Buyer's rights in and to
any Acquired Asset or future operation of the Business.
4.07 Material Contracts.
(a) Schedule 4.07(a) contains a true and complete list of all
Contracts (including descriptions of any oral agreements, understandings or
arrangements) that relate to the Acquired Assets or the Business and that:
(i) involve revenues or expenditures in excess of $25,000;
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(ii) are with a sales representative, manufacturer's
representative, distributor, customer, dealer, broker, sales agency, advertising
agency or other Person engaged in sales, distributing or promotional activities,
the performance of which will involve payments of more than $25,000, in the
aggregate;
(iii) provide for the purchase or sale of raw materials,
equipment, commodities, supplies, products, or other personal property, or for
the furnishing or receipt of services, the performance of which will involve
consideration of more than $25,000, in the aggregate;
(v) were entered into for the disposition of assets (outside
the ordinary course of business) or granting to any Person a right of first
refusal or option to purchase or acquire any Acquired Asset, which right or
option will be outstanding following the date hereof;
(vi) contain covenants limiting the freedom or ability of
Seller, Parent or any Seller Affiliate to engage in the Business;
(vii) are with any Governmental Authority or that may
reasonably be expected to result in payment of rebates, discounts, fees or other
amounts pursuant to Section 6.13;
(viii) relate to any research and development or clinical
trial conducted or to be conducted related to the Business or any Acquired
Asset, and all contracts related to clinical trials;
(ix) constitute a material joint venture, partnership or
similar agreement;
(x) constitute a material consulting agreement relating to the
Business;
(xi) constitute a material lease of personal property, whether
as lessor or lessee;
(xii) constitute a material guaranty or suretyship,
performance bond, indemnification or contribution agreement, including any
corporate or personal guarantee to suppliers, sureties, banks or others;
(xiii) involve a term of more than sixty (60) days, may not be
terminated by Seller, Parent or any Seller Affiliate, without penalty, within
thirty (30) days after the delivery of a termination notice by Seller, Parent or
any Seller Affiliate, as applicable, and
involve revenues or expenditures in excess of $25,000; or
(xiv) constitute a Contract that is otherwise material to the
conduct of the Business (or the violation of which would, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect).
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(b) The Contracts referenced in Section 4.07(a), together with all
Intellectual Property Licenses, are collectively referred to as, the "Material
Contracts." Seller and Parent have made available to Buyer true, correct and
complete copies of each Material Contract (including any amendments, addenda,
modifications, supplements or waivers thereto) to which it is party. Except as
set forth in Schedule 4.07(b), all Material Contracts are legal, valid and
binding contracts, are in full force and effect and enforceable in accordance
with their respective terms, and will continue to be legal, valid and binding,
in full force and effect and enforceable on identical terms immediately
following the consummation of the transactions contemplated hereby.
(c) Except as set forth in Schedule 4.07(c), none of Seller,
Parent and, to Seller's Knowledge, any other party to any Material Contract is
(or with notice or lapse of time or both would be) in violation or breach of, or
in default under, the terms of such Material Contract. Except as set forth in
Schedule 4.07(c), there is no dispute in connection with, and, to Seller's
Knowledge, there has not occurred any event or condition, which (whether with or
without notice, lapse of time or both, or the happening of any occurrence of any
other event) constitutes a basis of force majeure or other claim of excusable
delay or nonperformance by any Person under, any Material Contract. Except as
set forth in Schedule 4.07(c), neither Seller nor Parent has received any
written notice from any counterparty to any Material Contract of any dispute,
breach, penalty, liability, refusal or other default or event that with or
without notice or lapse of time or both, would violate, breach, conflict with,
constitute a default under, or permit the termination or acceleration of
maturity or performance of, or result in the imposition of an Encumbrance upon
any of the Acquired Assets or any of the Assumed Liabilities. Neither Seller nor
Parent has waived any rights under or with respect to any Material Contract.
(d) Schedule 4.07(d) sets forth a description of all negotiations
currently in process that relate to any Material Contract or any prospective
Material Contract to which Seller or Parent will be a party or by which Seller
or Parent may be bound or that relates any Acquired Asset or the Business.
4.08 Licenses and Permits.
(a) Schedule 4.08(a) sets forth a true, correct and complete list
of all licenses, permits, orders, franchises, certificates and other
governmental authorizations, consents, rights, concurrences, exemptions,
clearances, registrations and approvals issued by and declarations,
registrations and filings with any Governmental Authority that are necessary for
Seller and Parent to conduct the Business as currently conducted, including all
Regulatory Applications and facilities registrations relating to the Acquired
Assets or the Business (collectively, the "Permits"). Seller and Parent have
made available to Buyer true, correct and complete copies of all material
Regulatory Correspondence of Seller, Parent or any other Seller Affiliate
related to the Acquired Assets or the Business since the date of initial
application for any regulatory approval.
(b) Seller and Parent, collectively, have all Permits necessary
for the conduct of the Business (including with respect to Environmental Laws)
by them in jurisdictions where they currently conduct business, all such Permits
are valid and in full force and effect, in
23
good standing, and all information submitted to the applicable Governmental
Authority in order to obtain each such Permit was true, accurate and complete in
all material respects when submitted, and, to Seller's Knowledge, there is no
impediment to any renewal thereof. The Business is, and at all times has been,
operated in compliance with the requirements, terms and conditions of all
Permits and with any Order of any Governmental Authority that is applicable to
the operation of the Business. None of Seller, Parent and the other Seller
Affiliates has received any written notice or, to Seller's Knowledge, oral
notice from any Governmental Authority or any Spire Person of any deficiency
with respect to any Permit. Except as set forth on Schedule 4.08(b)(i), no
proceeding is pending or, to Seller's Knowledge, threatened to revoke or amend
any of such Permits nor, to Seller's Knowledge, are there facts or circumstances
which could reasonably be expected to form a basis upon which a Governmental
Authority could seek to revoke, suspend, cancel, modify, place on probation, or
amend any Permit. The execution and delivery of this Agreement will not result
in any non-renewal, cancellation, modification, impairment, revocation,
suspension or limitation of any Permit that would, individually or in the
aggregate, reasonably be expected to result in a Material Adverse Effect, and,
except as set forth on Schedule 4.08(b)(ii), no Permit by its terms requires the
consent of its issuing authority in order to remain in full force and effect
after the execution and delivery of this Agreement or the consummation of the
transactions contemplated by this Agreement.
4.09 Compliance with Law and Regulatory Requirements; Warranties.
(a) Except as set forth on Schedule 4.09(a)(i), Seller and Parent
are in compliance with all Device Regulations and all applicable Laws (including
Environmental Laws) and all Orders with respect to their businesses in the
medical device field, and no Action has been filed or commenced or, to Seller's
Knowledge, threatened to be filed or commenced against any of them alleging any
failure to so comply. Except as set forth in Schedule 4.09(a)(ii), within the
three (3) year period immediately preceding the date hereof, none of Seller,
Parent and the other Seller Affiliates has conducted, whether voluntarily or
otherwise, nor is there currently under consideration by Seller, Parent, or the
other Seller Affiliates, any recall, removal, market withdrawal or corrective
action with respect to any Product or Acquired Asset.
(b) Without limiting the generality of the foregoing, except as
set forth on Schedule 4.09(b), Seller, Parent and the other Seller Affiliates
have conducted and are conducting the Business and have used and are using the
Products and Acquired Assets in compliance with all material respects with the
FDCA, the Directive, all other Device Regulations, and the applicable national
legislation of the European Union Member States. Except as set forth on Schedule
4.09(b), each Product that is a Regulated Product has been and is being
developed, manufactured, tested, packaged, labeled, distributed, marketed,
commercialized and sold by such Person in compliance in all material respects
with applicable Laws, including those relating to (i) good manufacturing
practices, including quality systems requirements, (ii) the Regulatory
Applications, (iii) investigational devices, (iv) clinical studies and the
protection of human subjects, (v) labeling, (vi) record keeping and (vii) filing
of MDRs and other reports to the FDA, Notified Body or other applicable
Government Authority.
(c) Except as set forth in Schedule 4.09(c), none of Seller,
Parent and the other Seller Affiliates has received notice of, or been subject
to, any adverse inspectional
24
finding, Form 483, warning letter, finding of deficiency, finding of
non-compliance, compelled or voluntary recall, data integrity review,
investigation, penalty, fine, sanction, assessment, request for corrective or
remedial action, or other compliance or enforcement action by the FDA, any
Notified Body or other Governmental Authority relating to any Product, any
Product-related marketing or promotional materials, or any of the facilities in
which any Products are manufactured, tested, packaged, labeled, stored or
handled.
(d) None of Seller, Parent and the other Seller Affiliates, nor,
to Seller's Knowledge, any of their employees (or agents), have made an untrue
statement of material fact or fraudulent statement to the FDA or any other
similar Governmental Authority, or in any records and documentation prepared or
maintained to comply with the applicable Laws, with respect to any Product or
the Business, or failed to disclose a material fact required to be disclosed to
the FDA or any other similar Governmental Authority. None of Seller, Parent and
the other Seller Affiliates has failed to comply in any respect with any testing
requirements or study protocols in connection with the work relied upon by
Seller or any Seller Affiliate in any submission or documentation for the FDA or
other Governmental Authorities related to any Product or Acquired Asset.
(e) Seller, Parent, the other Seller Affiliates and their
officers, directors and employees (and to the Knowledge of Sellers, sales
agents) have not, with respect to the manufacture, distribution or sale of any
Product: (i) been debarred or received notice of action or threat of action with
respect to debarment under the provisions of 21 U.S.C. ▇▇.▇▇. 335a, 335b, or
335c, 42 U.S.C. ss. 1320a-7, 45 C.F.R. Part 76 or any equivalent provisions in
any other applicable jurisdiction; or (ii) been subject to any other material
enforcement action involving the FDA or any other similar Governmental
Authority, including any suspension, consent decree, notice of criminal
investigation, indictment, sentencing memorandum, plea agreement, court order or
target or no-target letter, and none of the foregoing are pending or, to
Seller's Knowledge, threatened in writing against same. None of Seller, Parent
and the other Seller Affiliates has made or offered any payment, gratuity or
other thing of value that is prohibited by any Law to personnel of the FDA or
any other Governmental Authority.
(f) Except as set forth on Schedule 4.09(f)(i), there are not
presently pending, nor, to Seller's Knowledge, threatened in writing, any civil,
criminal or administrative actions, suits, demands, claims, hearings, notices of
violation, investigations, proceedings, demand letters, or other communications
relating to any alleged hazard or alleged defect in design, manufacture,
materials or workmanship, including any failure to warn or alleged breach of
express or implied warranty or representation, relating to any Product, or
alleging that any Product is otherwise unsafe or ineffective for its intended
use. Except as set forth on Schedule 4.09(f)(ii), none of Seller, Parent and the
other Seller Affiliates has within the three (3) year period immediately
preceding the date hereof made any modification to any Product because of
warranty, product liability, regulatory or other claims or communications
concerning alleged hazards or defects in such Product.
(g) To the extent applicable to the Business and to Seller's
Knowledge:
25
(i) Seller, Parent and any other Seller Affiliate pays only
reasonable travel and meal costs for health care professionals receiving
training sponsored by any of them, and each such health care professional has a
bona fide need for such training;
(ii) Seller, Parent and any other Seller Affiliate provides
educational grants to third party educational sponsors only if such sponsors
have a genuine educational purpose or function and only when: (x) the
educational gathering is primarily dedicated to promoting objective scientific
and educational activities and discourse; and (y) the training institution or
the conference sponsor selects the attending health care professionals who are
in training, and (2) any meals sponsored or furnished by Seller, Parent or any
other Seller Affiliate at a conference sponsored by a third party are of modest
value;
(iii) Seller, Parent and any other Seller Affiliate pays
consultants no more than fair market value for their services, plus reasonable
and actual expenses, and only purchases services for which there is a
commercially reasonable need that is identified by the parties in advance;
(iv) any gift furnished by a Seller, Parent and any other
Seller Affiliate has never exceeded $100 and has never been in the form of cash
or a cash equivalent;
(v) all grant making functions for Seller, Parent or any
Seller Affiliate are separated from each such entity's sales and marketing
functions; and
(vi) all price concessions offered or furnished by Seller,
Parent or any Seller Affiliate to purchasers comply with the discount safe
harbor (42 C.F.R. ss. 1001.952(h)).
(h) Neither Seller, Parent, nor any other Seller Affiliate has
established any reimbursement support program, such that payment for any Product
is contingent upon a purchaser's receipt of payment from a third party payer.
Neither Seller, Parent, nor any other Seller Affiliate furnishes any coverage,
coding, or billing advice to any health care professionals regarding off-label
indications of any Product. Without limiting the generality of the foregoing,
each of Seller, Parent and the other Seller Affiliates are conducting the
Business and using the Products, and have always conducted the Business and used
the Products, in compliance with the Anti-Kickback Statute (42 U.S.C. ss.
1320a-7b), Civil Monetary Penalty Statute (42 U.S.C. ss. 1320a-7a), the ▇▇▇▇▇
Law (42 U.S.C. ss. 1395nn), the False Claims Act (31 U.S.C. ss. 3729 et seq.)
and all of the regulations promulgated under all such statutes.
4.10 Environmental Matters(a) . Seller is in compliance with all
applicable Environmental Laws. None of Seller, Parent and the other Seller
Affiliates has received any written notice or report regarding any actual or
alleged violation of Environmental Laws, or any condition that would constitute
such a violation, or any liabilities or potential liabilities, including any
investigatory, remedial or corrective obligations, relating to the Business,
Seller or their facilities arising under Environmental Laws. To Seller's
Knowledge, no Hazardous Substances are present in violation of any Environmental
Law on Seller's property, and no material expenditures by Seller, Parent or any
Seller Affiliate are or will be required in order to
26
comply with any such existing Environmental Laws. Neither Seller, Parent nor any
other Seller Affiliate operates any facility outside of the United States.
4.11 Employees. Seller, Parent and the other Seller Affiliates have
complied in all material respects with all applicable Laws pertaining to the
employment or termination of employment of their current or former employees,
including the Worker Adjustment and Retraining Notification Act of 1988 and all
such other Laws relating to labor relations, equal employment opportunities,
fair employment practices, prohibited discrimination and other similar
employment activities.
4.12 Taxes.
(a) Each of Seller, Parent and the Seller Affiliates has timely
filed all Tax Returns that it was required to file. All such Tax Returns are
true, correct and complete in all material respects. All Taxes owed by Seller or
Parent (whether or not shown or required to be shown on any Tax Return) have
been timely paid. There is no Tax deficiency or proposed Tax deficiency of any
Person that could result in an Encumbrance on any of the Acquired Assets or in a
claim against Buyer as transferee or owner of the Acquired Assets. Each of
Seller and Parent have collected and remitted all Taxes as required by each
local jurisdiction in which it does business. No claim has ever been made by a
Taxing Authority in a jurisdiction where Seller, Parent or any other Seller
Affiliate does not file Tax Returns that it is or may be subject to taxation by
that jurisdiction with respect to any of the Acquired Assets or the Business.
There are no Encumbrances on any of the Acquired Assets that arose in connection
with any failure (or alleged failure) to pay any Tax and, to Seller's Knowledge,
there is no proposal by any Taxing Authority to attach any such Encumbrances.
(b) Except as set forth on Schedule 4.12(b), each of Seller,
Parent and the Seller Affiliates has timely withheld and paid all Taxes required
to have been withheld and paid in connection with amounts paid or owing to any
employee, independent contractor, creditor, stockholder, or other third party
relating to any of the Acquired Assets or the Business.
(c) There is no dispute or claim concerning any liability of
Seller or Parent for Taxes either (i) claimed or raised by any Taxing Authority
or (ii) except as set forth on Schedule 4.12(c), as to which Seller, Parent, any
other Seller Affiliate or any of the directors and officers (or employees
responsible for Tax matters) of Seller or Parent has knowledge based upon
personal contact with any agent of such Taxing Authority.
(d) None of Seller, Parent and the other Seller Affiliates has
waived (or is subject to a waiver of) any statute of limitations in respect of
Taxes or agreed (or is subject to an agreement) to extend the time with respect
to a Tax assessment or deficiency.
(e) None of Seller, Parent and the Seller Affiliates has made any
payments, is obligated to make any payments, or is a party to any agreement that
under certain circumstances could obligate it to make any payments with respect
to any of the Acquired Assets or the Business that will not be deductible under
Code Section 162(m) or 280G.
27
(f) Schedule 4.12(f) sets forth all closing agreements and Tax
rulings requested or received from any Taxing Authority with respect to the
Acquired Assets or the Business.
(g) Seller, Parent and the Seller Affiliates are not obligated in
connection with the Acquired Assets or the Business to pay the Taxes of another
Person by contract, as transferee, as successor, or otherwise.
4.13 Intellectual Property.
(a) Owned Intellectual Property. Schedule 4.13(a) sets forth a
complete and correct list (including application number, registration number or
equivalent identifying information, where applicable) of all Intellectual
Property (other than Trade Secrets), owned by Seller, Parent or any other Seller
Affiliate and Held for Primary Use in the Business (the foregoing, together with
all Trade Secrets owned by Seller, Parent or any other Seller Affiliate and Held
for Primary Use in the Business, is referred to collectively as "Owned
Intellectual Property"). With respect to each application and registration
identified on Schedule 4.13(a), (i) Seller or Parent is listed in the records of
the appropriate United States, state or non-U.S. registry as the sole current
owner of record thereof, and (ii) each of Seller, Parent and each other Seller
Affiliate is in compliance in all material respects with all legal requirements
pertaining to the timely payment of filing, examination and maintenance fees, as
well as timely post-registration filing of affidavits of use, incontestability
and renewal applications with respect thereto. With respect to Trademarks for
which a registration has been issued or application for registration has been
filed (collectively "Registered Marks"), except as specifically set forth in
Schedule 4.13(a), each of the Registered Marks listed in Schedule 4.13(a) has
been, since the date of application, and continues to be, used in the applicable
country of registration or application on all of the goods or in connection with
all of the services identified in the applicable registration, application, or
affidavit or statement of use filed in the appropriate trademark office with
respect thereto. Except as specifically set forth on Schedule 4.13(a), no action
or omission of Parent, Seller or any other Seller Affiliate is reasonably likely
to result in the abandonment, cancellation, forfeiture, relinquishment, or
unenforceability of any Trademark listed in Schedule 4.13(a). Parent and Seller
have taken or caused to be taken all reasonable steps to protect Seller's and
Parent's rights in and to each Trademark listed in Schedule 4.13(a) and to
prevent the unauthorized use thereof by any other Person. All inventors,
including current or former employees of Seller, Parent and each other Seller
Affiliate, are appropriately named as inventors on any issued Patent or pending
Patent application listed in Schedule 4.13(a). To Seller's Knowledge (without a
duty of reasonable inquiry), all prior art has been disclosed in all issued
Patents and pending Patent applications listed in Schedule 4.13(a), in each
case, to the extent the non-disclosure of which (x) would invalidate any such
issued Patent, or (y) in connection with any such Patent application, prevent
the issuance or enforceability of a Patent covering all claims contained
therein.
(b) Licensed Intellectual Property.
(i) Schedule 4.13(b)(i)(1) sets forth a complete and correct
list of all Intellectual Property (other than Trade Secrets) Held for Primary
Use in the Business that
28
Seller, Parent, or any other Seller Affiliate has licensed from others or has
otherwise been permitted by others to use, except for licenses of commercial
off-the-shelf software (the foregoing, together with all Trade Secrets Held for
Primary Use in the Business that Seller, Parent, or any other Seller Affiliate
has licensed from others or has otherwise been permitted by others to use, is
referred to collectively as "Licensed Intellectual Property"). Except for such
Intellectual Property that is in the public domain, each of Seller, Parent and
each other Seller Affiliate has used such Licensed Intellectual Property in all
material respects in accordance with an agreement or instrument, each of which
is identified in Schedule 4.13(b)(i)(2) (each an "Inbound Intellectual Property
License").
(ii) Schedule 4.13(b)(ii) contains a complete and accurate
list of all licenses, sublicenses, and other agreements under which rights are
granted by Seller, Parent or any other Seller Affiliate in connection with the
Business to any third party with respect to any Business Intellectual Property
("Outbound Intellectual Property License" and, collectively with Inbound
Intellectual Property Licenses, "Intellectual Property Licenses").
(iii) Except as set forth on Schedule 4.13(b)(iii), all
Intellectual Property Licenses are valid and enforceable and, immediately
following the Closing, to Seller's Knowledge, will remain in full force and
effect. Except as set forth on Schedule 4.13(b)(iii), Seller, Parent and each
other Seller Affiliate has performed all obligations imposed upon it under the
Intellectual Property Licenses in all material respects. Except as set forth on
Schedule 4.13(b)(iii), none of Seller, Parent or any other Seller Affiliate and,
to Seller's Knowledge, no other party thereto is in breach of or default under
the terms of any Intellectual Property License, and there is not any event which
with notice or lapse of time or both would constitute a default thereunder.
Except as set forth in Schedule 4.13(b)(iii), there are no written notices of
any disputes or disagreements with respect to any Intellectual Property
Licenses.
(c) Except as set forth on Schedule 4.13(c)(i) and any
manufacturing processes or practices of third party vendors of the Business that
are not contained within the Purchased Intellectual Property, (i) the Purchased
Intellectual Property, to Seller's Knowledge, will be sufficient to permit Buyer
to operate the Business immediately after the Closing substantially in the same
manner as operated by Seller and Parent immediately prior to the Closing and
(ii) the Purchased Intellectual Property constitutes all of the Intellectual
Property currently used by Parent and Seller in the conduct of the Business.
Except as set forth in Schedule 4.13(c)(ii), all of the Business Intellectual
Property is fully assignable or licensable by Seller or Parent to any Person,
and all of the Intellectual Property that is subject to the License Agreement
and Sublicense Agreement is fully licensable or sublicensable by Seller or
Parent, as applicable, to Buyer. To Seller's Knowledge (without a duty of
reasonable inquiry), all claim limitations in all issued Patents included in the
Owned Intellectual Property are valid and enforceable.
(d) Each of Seller, Parent and each other Seller Affiliate has
taken reasonable steps, consistent with normal industry practice, to maintain
the confidentiality of all Trade Secrets used, currently in development for use
or held for use in the Business. To Seller's Knowledge, there has been no
misappropriation of any such Trade Secrets by any Person, and, to Seller's
Knowledge, no such Trade Secrets or other proprietary information have been used
by,
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disclosed to or discovered by any Person, except pursuant to valid and
appropriate non-disclosure, assignment and/or license agreements that have not
been breached. To Seller's Knowledge, Seller or Parent owns, and has the
exclusive right to use, all Trade Secrets contained within the Business
Intellectual Property.
(e) All Spire Persons who have contributed to or participated in
the design, conception, development or reduction to practice of any Owned
Intellectual Property (collectively, the "Participants") either (i) have been a
party to "work-for-hire" arrangements or agreements with Seller, Parent or such
other Seller Affiliate, in accordance with applicable Law, that have assigned,
or require them to assign, to Seller or Parent full, effective, sole, exclusive
and original ownership of all tangible property and Intellectual Property
designed, conceived, developed or reduced to practice by them, or (ii) have
executed appropriate instruments of assignment of inventions agreements
assigning all right, title and interest in their inventions to Seller or Parent,
free and clear of all Encumbrances. Seller and Parent possess executed copies of
all such written agreements by all present and former Participants, all of which
have been made available to Buyer. Except as set forth in Schedule 4.13(e),
neither Seller nor any Participant has, in the course of design, conception,
development or reduction to practice of the Owned Intellectual Property, used
any facilities of, or received any remuneration attributable to, such design,
conception, development or reduction to practice from any academic or research
institution or Governmental Authority. Seller and Parent have taken commercially
reasonable efforts in accordance with normal industry practice to protect the
confidentiality of all Intellectual Property and confidential or proprietary
information relating to the Products, the Business Intellectual Property and the
other Acquired Assets.
(f) Except as set forth in Schedule 4.13(f), neither Seller nor
Parent are party to any agreement that restricts, and neither has waived, any
right either may have to bring Actions against any Person that is infringing any
Business Intellectual Property or to retain for itself any Damages recovered in
any such Action.
(g) To Seller's Knowledge (without a duty of reasonable inquiry),
except as set forth in Schedule 4.13(g), the conduct of the Business as
currently conducted and the use of the Business Intellectual Property as
currently used in the Business do not infringe, misappropriate or otherwise
violate the Intellectual Property of any other Person, nor, to Seller's
Knowledge (without a duty of reasonable inquiry), within the previous six (6)
years have infringed, misappropriated or otherwise violated, any Intellectual
Property of any other Person. Except as set forth in Schedule 4.13(g), no claims
are pending or, to Seller's Knowledge, threatened, against Seller, Parent, any
other Seller Affiliate or the Business by any Person (i) with respect to the
ownership, validity, enforceability, effectiveness or use of any Business
Intellectual Property, (ii) contesting the right of Seller, Parent or any other
Seller Affiliate to manufacture, market or sell any Products or to use any of
the Acquired Assets, or (iii) alleging that the conduct of the Business as
currently conducted or the use of the Business Intellectual Property as
currently used in the Business infringes, misappropriates or violates the
Intellectual Property rights of any other Person. Except as set forth in
Schedule 4.13(g), there is no pending or, to Seller's Knowledge, threatened,
opposition, interference or cancellation proceeding before any Governmental
Authority in any jurisdiction against any registrations or applications relating
to the Owned Intellectual Property. To Seller's Knowledge, there is no pending
or threatened,
30
opposition, interference or cancellation proceeding before any Governmental
Authority in any jurisdiction against any registrations or applications relating
to the Licensed Intellectual Property.
(h) No part of the Business Intellectual Property is owned by,
licensed from or licensed to any Seller Affiliate (other than Parent), any Spire
Person or any stockholder, director or officer of Seller or any Seller
Affiliate.
4.14 Product Data; Product Specifications.
(a) Schedule 4.14(a) provides a true, correct and complete list of
the following (the "Product Data"): (i) all current sources of supply for any
raw material, supply or component part required or used in connection with any
Acquired Asset or the Business, noting, in each case, whether a supplier is a
sole source of supply for which there is no ready alternative to Seller or
Parent with respect to operation of the Business on comparable or better terms;
(ii) all locations at which tangible Acquired Assets are located (including
locations owned or controlled by third parties); and (iii) a purchase item file,
including names and addresses of all current suppliers, vendors and
subcontractors, for all items currently used in connection with any Product.
(b) Schedule 4.14(b) provides a true, correct and complete list,
summary and description of all Product clinical trials and studies that have
been conducted by or on behalf of Seller, Parent or any other Seller Affiliate.
(c) Except as set forth on Schedule 4.14(c), the Product
Specifications (copies of which have been provided to Buyer) are complete,
current and accurate. Without limiting the generality of the foregoing, except
as set forth on Schedule 4.14(c), the Product Specifications are (i) sufficient
in detail and content to identify and explain the designs, concepts and
processes described therein and (ii) include all data and know-how that is
proprietary to Seller, Parent or any other Seller Affiliate and is used by
Seller, Parent, any other Seller Affiliate or any Spire Person in connection
with the Products or the Acquired Assets.
4.15 Sufficiency of Assets. Except for the Excluded Assets listed and
other matters set forth on Schedule 4.15 and any manufacturing processes or
practices of third party vendors of the Business that are not contained within
the Purchased Intellectual Property, the Acquired Assets (i) to Seller's
Knowledge, constitute all of the assets and properties required for the
continued conduct of the Business immediately after the Closing in substantially
the same manner as currently conducted by Seller and Parent, and (ii) constitute
all of the assets and properties of Seller, Parent and the other Seller
Affiliates Held for Primary Use in the Business.
4.16 Financial Information; Indebtedness.
(a) Set forth on Schedule 4.16(a) are unaudited pro forma balance
sheets for the Business as of June 30, 2009, December 31, 2008 and December 31,
2007, and related unaudited pro forma statements of operations for the six
months ended June 30, 2009 and for the fiscal years ended December 31, 2008 and
December 31, 2007 and statements of cash
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flows for the Business for the six months ended June 30, 2009 and for the fiscal
year ended December 31, 2008 (collectively, the "Financial Information"). The
Financial Information (i) has been internally prepared by Parent and Seller in
good faith based upon the books and records of Parent and Seller, (ii) presents
fairly in all material respects the financial position and results of operations
of the Business as of the indicated dates and for the indicated periods, (iii)
contains certain estimates and adjustments necessary in order to present the
financial condition and results of operations of the Business on a stand alone
basis, and (iv) has been prepared in accordance with Parent's and Seller's
historical accounting methods, consistently applied throughout the indicated
dates and for the indicated periods.
(b) Schedule 4.16(b) sets forth a true and complete description of
(i) the Indebtedness of Seller and Parent (relating to or affecting in any way
the Acquired Assets or the Business), (ii) the Encumbrances that relate to such
Indebtedness that encumber any assets of Seller and Parent (including the
Acquired Assets), and (iii) the name of each lender thereof.
4.17 Absence of Certain Changes or Events(a) . Since December 31, 2008,
(i) except as set forth on Schedule 4.17(a), Seller and Parent have operated the
Business in the ordinary course consistent with past custom and practice, and
(ii) except as set forth on Schedule 4.17(b), there has been no Material Adverse
Effect and no event, change, condition or circumstance which, individually or in
the aggregate, could reasonably be expected to have a Material Adverse Effect.
4.18 Product Inventory. Except as set forth on Schedule 4.18, the
Product Inventory of the Business consists of items free of defects, in usable
condition and saleable in the ordinary course of the Business, consistent with
past practice.
4.19 Customers and Suppliers.
(a) Set forth on Schedule 4.19(a) is a true and correct list of
(i) the ten (10) largest customers (measured by revenues paid to Seller or
Parent with respect to the operation of the Business, in the aggregate, during
the twelve-month period ended December 31, 2008), together with the dollar
amount of sales made to such customers during such period, and (ii) the ten (10)
largest suppliers in terms of purchases by Seller or Parent with respect to the
operation of the Business during the twelve-month period ended December 31,
2008, and (iii) any sole source suppliers of goods or services for which there
is no ready alternative to Seller or Parent with respect to operation of the
Business on comparable or better terms, together with the dollar amount paid to
such suppliers during such period.
(b) Except as set forth on Schedule 4.19(b), since July 1, 2008
(i) no supplier of the Business or customer of the Business that purchases
directly from Seller, Parent or any Seller Affiliate and that constitutes one of
the twenty (20) largest customers (measured by revenues paid to Seller or Parent
with respect to the operation of the Business, in the aggregate, during the
twelve-month period ended December 31, 2008) has canceled or otherwise
terminated, or, to Seller's Knowledge, threatened to cancel, permit to expire or
otherwise terminate, its relationship with Seller or Parent, and (ii) neither
Seller nor any Seller Affiliate has received any written notice or, to Seller's
Knowledge, oral notice that any such supplier or
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customer may cancel, terminate or otherwise materially and adversely modify its
relationship with Seller or Parent (including by modifying its pricing) or limit
its services, supplies or materials to Seller or Parent.
4.20 Insurance. Seller and Parent maintain insurance in respect of the
Acquired Assets and the Business, covering such risks (including Product
Liability), in such amounts, with such terms and with such insurers as is
appropriate and consistent with industry practice (such insurance, the "Business
Insurance Policies"). Schedule 4.20 contains a true and complete list of all
Business Insurance Policies. All of the Business Insurance Policies are in full
force and effect and Seller, Parent and the other Seller Affiliates are in
compliance in all material respects with the terms of such policies. None of
Seller, Parent and the other Seller Affiliates has received any notice of
cancellation or non-renewal of any such Business Insurance Policy.
4.21 Affiliate Transactions. Except as set forth on Schedule 4.21, none
of the Seller Affiliates, the Spire Persons and the officers, directors and
employees of any Seller Affiliate (i) has provided or caused to be provided
within the last twelve (12) months, or (ii) provides or causes to be provided,
any assets, services or facilities used or held for use in connection with the
Business. Neither Seller nor Parent (i) has provided or caused to be provided
within the last twelve (12) months, or (ii) provides or causes to be provided,
any assets, services or facilities that relate to the Business to any Seller
Affiliate, any Spire Person or any officer, director, employee of any Seller
Affiliate.
4.22 Brokers' Fees. Except as set forth on Schedule 4.22, none of
Seller, Parent and the other Seller Affiliates has any liability or obligation
to pay any fees or commissions to any broker, finder or agent with respect to
the transactions contemplated by this Agreement.
4.23 Corrective Action Plans and Reclassification Plan. Seller and
Parent have successfully implemented those corrective action plans referenced in
attached Schedule 4.23(a). Seller and Parent have done and performed or caused
to be done and performed, or will have done and performed or will have caused to
be done and performed, all acts and items required as of the Closing Date by the
reclassification plan referenced in attached Schedule 4.23(b), including having
timely made all necessary filings with the FDA required thereby.
4.24 Semi-Exclusive License. Schedule 4.24(a) sets forth a true,
correct and complete list of all third parties that Seller or Parent has
permitted to distribute, market or sell round catheter products in the United
States under that certain Semi-Exclusive License Agreement, dated as of October
15, 2002, by and between Buyer and Parent (hereinafter, the "Semi-Exclusive
License"). Except as set forth on Schedule 4.24(b), neither Seller nor Parent
has permitted any third party to distribute, market or sell round catheter
products in the United States under the Semi-Exclusive License other than
independent, specialty distributors that do not, either by themselves or by any
of their Affiliates, manufacture, market or sell any products of their own.
Neither Seller nor Parent are aware of any violation, breach or default by Buyer
of any term of the Semi-Exclusive License.
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4.25 Disclosure. No representation or warranty on the part of Seller or
Parent contained in this Agreement, and no statement by Seller, Parent or any
Seller Affiliate contained in any of the Schedules or in any certificate, list
or other writing furnished to Buyer pursuant to any provisions of this
Agreement, contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements herein or therein, in
light of the circumstances under which they were made, not misleading.
4.26 Solvency. Each of Seller and Parent is solvent, meaning that each
is able to pay its debts as they become due, has sufficient capital to carry on
its business, and the fair present saleable value of its assets, calculated on a
going concern basis, is in excess of the amount of its liabilities (contingent
or otherwise).
ARTICLE V
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REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer hereby represents and warrants to Seller and Parent as follows,
subject in each case to such exceptions as are specifically set forth herein and
in the attached Schedules of Buyer:
5.01 Organization. Buyer is a corporation duly organized, validly
existing and in good standing under the Laws of the jurisdiction of its
formation with the full power and authority to conduct its business and to own
and lease its properties.
5.02 Authority. Buyer has the full power and authority to execute and
deliver this Agreement and perform its obligations hereunder and under the other
agreements and instruments to be executed and delivered by it in connection with
the transactions contemplated hereby and thereby. Buyer has taken all necessary
action to authorize the execution and delivery of this Agreement and such other
agreements and instruments and the consummation of the transactions contemplated
hereby and thereby. This Agreement is, and the other agreements and instruments
to be executed and delivered by Buyer in connection with the transactions
contemplated hereby and thereby will be, (when executed and delivered by all of
the Parties thereto), the legal, valid and binding obligations of Buyer,
enforceable in accordance with their respective terms except as such
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar Laws now or hereafter in effect affecting the
enforcement of creditor's rights generally.
5.03 No Violation. Neither the execution and delivery by Buyer of this
Agreement or the other documents or instruments to be executed and delivered by
Buyer pursuant hereto, nor the consummation by Buyer of the transactions
contemplated hereby or thereby (i) violates any provision of the certification
of incorporation, by-laws, or other constitutive documents of Buyer, (ii)
violates or conflicts with (a) any applicable Law or (b) any Order directed to
Buyer or affecting any of Buyer's assets or properties, or (iii) violates or
conflicts with or constitutes a default (or an event which, with notice or lapse
of time or both, would constitute a default) under or results in the termination
of, or accelerates the performance required by, any term or provision of any
contract, commitment, understanding, arrangement or
34
agreement to which Buyer is a party or by which Buyer or any of its properties
or assets may be bound or affected.
5.04 Consents. Except as set forth on Schedule 5.04, no authorization,
consent, approval, order or declaration of, registration or filing with or
notice to any Governmental Authority or other Person is necessary for the
execution and delivery of this Agreement or any other agreement or document to
be delivered by Buyer or the consummation by Buyer of the transactions
contemplated hereby or thereby.
5.05 Broker's Fees. Buyer has no liability or obligation to pay any
fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement.
5.06 Litigation. There are no Actions pending against or Orders binding
upon Buyer that could reasonably be expected to interfere with its ability to
consummate this Agreement or the transactions contemplated hereby.
5.07 Semi-Exclusive License. Except as set forth on Schedule 4.24(b),
Buyer is not aware of any violation, breach or default by Seller or Party of any
term of the Semi-Exclusive License.
ARTICLE VI
COVENANTS OF BUYER, SELLER, AND PARENT
6.01 Pre-Closing Covenants. The Parties agree as follows with respect
to the period between the date hereof and the Closing Date:
(a) General. Each of the Parties will use such Party's reasonable
best efforts to take all actions and to do all things necessary in order to
consummate and make effective the transactions contemplated by this Agreement
(including satisfaction, but not waiver, of the Closing conditions set forth in
Article VIII below).
(b) Notices and Consents. Seller and Parent shall give those
notices, make those registrations and filings, and use their reasonable best
efforts to obtain those authorizations, consents, approvals, orders and
declarations that, in each case, are set forth in Schedule 4.04. Seller and
Parent shall promptly advise Buyer upon receiving any oral or written
communication from any Person (including any Governmental Authority) with
respect to any of the items set forth on Schedule 4.04, and promptly provide
Buyer with copies all such written communications.
(c) Operation of Business. Seller and Parent will (i) continue to
operate the Business in the ordinary course, consistent with past practice, (ii)
except as may otherwise agreed to by the Parties, use reasonable best efforts to
maintain and preserve intact their relationships with customers and suppliers of
the Business, and (iii) comply in all material respects with all Laws affecting
the operation of the Business and the Acquired Assets. None of
35
Seller, Parent and any other Seller Affiliate will, without the prior written
consent of Buyer, (i) enter into any new Material Contract or violate, cancel,
amend, modify, extend, waive or exercise any option under any Material Contract
or any term thereof, provided that Seller and Parent shall be permitted to amend
or otherwise modify the Loan Agreements, (ii) incur, assume or guarantee any
indebtedness with respect to the Business, or otherwise incur any Encumbrance on
any of the Acquired Assets, (iii) change any of its pricing, accounting,
financial, reporting, inventory, credit or allowance practices, (iv) fail to pay
or satisfy when due any of its obligations with respect to the Business, (v)
make any election with respect to Taxes or settle or compromise any Tax
liability, (vi) waive any rights or entitlements, or settle or compromise, or
permit any settlement or compromise of, any claims pending or threatened with
respect to the Business or the Acquired Assets, or to which the Business or the
Acquired Assets are subject, (vii) enter into any settlement of any litigation
affecting the Business or the Acquired Assets, and (viii) not enter into any
agreement or commitment to do any of the foregoing actions in clauses (i)
through (viii). Without limiting the generality of the foregoing, no Party will
take any action that could reasonably be expected to adversely affect or
materially delay the ability of Seller, Parent or Buyer to obtain any necessary
approvals of any Person (including any Governmental Authority) required for the
transactions contemplated hereby or to perform their covenants and agreements
under this Agreement or to consummate the transactions contemplated hereby or
thereby.
(d) Reasonable Access. Seller and Parent will permit
representatives of Buyer (including legal counsel) to have reasonable access
during normal business hours, and in a manner so as not to interfere with the
normal business operations of the Seller or Parent, to all premises, properties,
personnel, and Records (including Records related to Taxes) Primarily Used in
the Business.
(e) Exclusivity. Seller and Parent will, and will cause their
respective directors, officers, employees, shareholders, Affiliates,
subsidiaries and representatives, to (i) immediately suspend any existing
activities, discussions or negotiations with all Persons other than Buyer and
its Affiliates with respect to the sale of Seller, Parent or any Acquired Asset
(a "Strategic Transaction"), and (ii) not, directly or indirectly, take any
action to encourage, solicit, participate in or initiate discussions or
negotiations with, or provide any information to, any Person (other than Buyer
and its Affiliates) with respect to a Strategic Transaction. Neither Seller nor
Parent will, and each of Seller and Parent will cause their respective
directors, officers, employees, shareholders, Affiliates, and representatives to
not, undertake any actions contrary to the terms of this Agreement. Seller and
Parent will notify Buyer immediately if any such inquiries or proposals are
received by, any such information is requested from, or any such negotiations
are sought to be initiated or continued with, it by any Person.
(f) Disclosure. At any time after the date of this Agreement and
prior to the Closing, Seller and Parent shall promptly notify Buyer in writing
if either of them becomes aware of any matter inconsistent with any of their
representations and warranties contained in this Agreement (incorporating, where
applicable, the Schedules of Seller and Parent in the form attached hereto),
including any matter that could reasonably be expected to result in a breach of
such representations or warranties. Prior to the Closing, Seller and Parent
shall supplement the Schedules of Seller and Parent hereto referenced in Article
IV hereof (the "Seller Disclosure
36
Schedules"), both to correct any inaccuracy contained in the Seller Disclosure
Schedules and to reflect any development that, (i) if existing or known to
Parent or Seller at the date of this Agreement, would have been required to be
set forth in the Seller Disclosure Schedules or in order for Seller's and
Parent's representations and warranties set forth in this Agreement to be true
and correct or (ii) has rendered any information contained in the
representations and warranties or Seller Disclosure Schedules not to be true and
correct (each a "Disclosure Supplement"). The delivery of any Disclosure
Supplement shall not make accurate any representation or warranty that was not
accurate when made. The determination as to whether the condition to closing set
forth in Section 8.01 shall have been satisfied shall be made solely by
reference to Parent's and Seller's representations and warranties as made on the
date hereof (incorporating, where applicable, the Seller Disclosure Schedule as
of the date of this Agreement in the form attached hereto), without reference to
any Disclosure Supplement.
6.02 Public Announcements. The Parties shall jointly agree on any
announcement or correspondence with or to the public or customers, suppliers or
employees of Seller or Parent or other third persons about the terms and
conditions of this Agreement or the transactions contemplated hereby, unless
such announcement is required by Law or regulations of any stock exchange or
other Governmental Authority, and in such case the announcing or corresponding
Party will notify the other Parties and provide them in advance with a copy of
the public disclosure and a reasonable opportunity to comment on such proposed
disclosure. Each Party will consider the comments of the other Parties, but will
not be required to incorporate such comments.
6.03 Further Assurances.
(a) Each Party shall at the request of any other Party do and
perform or cause to be done and performed all such further acts and furnish,
execute and deliver such other documents, instruments, certificates, notices or
other further assurances as the requesting party may reasonably request, from
time-to-time, to consummate the transactions contemplated by this Agreement,
including to fully vest in Buyer all of Seller's and Parent's right, title and
interest in and to the Acquired Assets in accordance with the terms and
conditions of this Agreement. In furtherance of the foregoing, to the extent
that any of the Acquired Assets (including any Assumed Contract) is not
assignable without the consent, waiver or approval of another Person and such
consent, waiver or approval has not been obtained before or at the Closing, this
Agreement shall not constitute an assignment or an attempted assignment of such
Acquired Asset by Seller or Parent or an assumption or an attempted assumption
of such Acquired Asset or related Assumed Liability by Buyer. Seller and Parent,
at their sole cost and expense, shall for a period of eighteen (18) months
following the Closing Date, use commercially reasonable efforts to obtain any
such consent, waiver or approval as soon as practicable; provided that neither
Seller nor Parent shall take any action to seek such consent, waiver or approval
without prior consultation with or approval by Buyer and Buyer shall not be
required to pay any sums in connection therewith. Until any such consent, waiver
or approval shall be obtained or if any such consent, waiver or approval shall
not be obtained, Seller and Parent shall cooperate with Buyer in any reasonable
arrangement designed to provide Buyer with the benefits intended to be assigned
to Buyer with respect to the underlying Acquired Asset including, in the case of
any Acquired Asset that is an Assumed Contract, enforcement for the
37
account of Buyer of any and all rights of Seller or Parent against any other
party to such Assumed Contract arising out of the breach, non-fulfillment or
cancellation thereof by such other party or otherwise. To the extent that Buyer
is provided benefits of any Acquired Asset that is an Assumed Contract pursuant
to the immediately preceding sentence, Buyer shall perform on behalf of Seller
or Parent, pursuant to and in accordance with such Assumed Contract, and assume
responsibility for, the obligations of Seller or Parent that correspond to the
benefits of such Assumed Contract provided by Seller and Parent to Buyer. Upon
the receipt by the Parties following the Closing of the consent, waiver or
approval of the applicable Person of or to the assignment of any such Assumed
Contract not assigned at Closing, such Assumed Contract shall, without any
further action on the part of the Parties and without additional consideration,
be deemed to have been assigned by Seller and Parent to Buyer and all related
Assumed Liabilities shall be assumed by Buyer as of the date of the receipt of
such consent, waiver or approval. Nothing herein shall constitute a waiver by
Buyer of any breach by Seller or Parent of any representation, warranty,
covenant or agreement.
(b) Seller and Parent shall make available to Buyer the services
of (i) ▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ for up to ten (10) hours
per week, in the aggregate, during the six-month period immediately following
the Closing, and (ii) all other personnel and employees of Seller and Parent to
the extent that such services are reasonably required by Buyer during the
three-month period immediately following the Closing, in each case, in
connection with the transition of the Business to Buyer and Buyer's operation
thereof following the Closing (collectively, the "Transition Services"). The
Transition Services shall be provided by such Persons in a manner and at a level
generally consistent with that provided by such Persons to the Business prior to
the Closing. The Transition Services shall include assistance with respect to
customer and supplier relations, referral of customer and supplier inquiries,
assistance with respect to the transition of operations, and general
administration and logistical support. The Transition Services shall be provided
at no additional cost or consideration to Buyer and the Parties acknowledge that
Buyer shall not be obligated to pay any amounts to Seller, Parent, any other
Seller Affiliate or any of their respective employees in respect of payroll,
benefits or similar obligations.
6.04 Expenses. Each Party will bear its own costs and expenses
(including legal fees and expenses and fees and expenses paid or payable to
brokers, finders or agents) incurred in connection with this Agreement and the
transactions contemplated hereby. For the avoidance of doubt, neither Buyer nor
any of its Affiliates shall assume or be responsible for the payment of any Tax
liabilities incurred by Seller, Parent or any other Seller Affiliate in
connection with the transactions contemplated by this Agreement.
6.05 Delivery of Acquired Assets and Excluded Assets. Seller and Parent
shall, and shall cause the Seller Affiliates to, promptly deliver to Buyer, if
and when received, any amounts or other items that shall be received by Seller,
Parent or any other Seller Affiliate after the Closing Date that are Acquired
Assets. Buyer shall promptly deliver to Seller, if and when received, any
amounts or other items that shall be received by Buyer after the Closing Date
which are Excluded Assets.
6.06 Confidentiality.
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(a) From and after the Closing Date, Seller and Parent shall, and
shall inform and use commercially reasonable efforts to cause the Seller
Affiliates and each of their respective employees, agents and representatives
(collectively, the "Seller Recipients") to, keep confidential and not disclose
to any third Person or use any information of a confidential nature relating to
any Product, any Acquired Asset (including the Records), the Business and this
Agreement, except for any such information that (i) is available to the public
on the Closing Date, (ii) thereafter becomes available to the public other than
as a result of a disclosure by Seller, Parent or any other Seller Affiliate,
(iii) becomes available to Seller, Parent or any other Seller Recipient
following the Closing Date on a non-confidential basis from a source that to
Seller's, Parent's or such Seller Recipient's knowledge is not prohibited from
disclosing such information to Seller, Parent or Seller Recipient by a legal,
contractual or fiduciary obligation to any other Person or (iv) is reasonably
necessary for advisors, including attorneys, accountants and bankers to perform
services on behalf of Seller, Parent or the Seller Recipients. Should Seller,
Parent or any such Seller Recipient be required to disclose any such information
in response to an order or judgment or as otherwise required by Law or
administrative process, it shall inform Buyer in writing of such request or
obligation as soon as possible after Seller, Parent or such Seller Recipient is
informed of it and before any information is disclosed, so that a protective
order to other appropriate remedy may be obtained by Buyer. If Seller, Parent or
such Seller Recipient is obligated to make such disclosure, it shall only make
such disclosure to the extent to which it is so obligated as advised by its
counsel, but not further or otherwise.
(b) Effective upon the Closing, the Confidentiality Agreement,
dated as of March 16, 2009 (the "Confidentiality Agreement"), by and between
Parent and Buyer shall terminate and be of no further force and effect with
respect to Confidential Information (as such term is defined in the
Confidentiality Agreement) related to the Products, the Acquired Assets and the
Business, but shall remain in effect with respect to all other Confidential
Information (as such term is defined in the Confidentiality Agreement).
6.07 Non-Competition; Non-Disparagement.
(a) Non-Competition. Seller and Parent each acknowledge that
reasonable limits on their respective abilities to engage in activities
competitive with Buyer in operation of the Business after Closing are warranted
to protect Buyer's investment in acquiring same. Accordingly, Seller and Parent
each covenant and agree that, commencing on the Closing Date and ending on the
date that is five (5) years thereafter, none of Seller, Parent and the Seller
Affiliates shall engage in any business that is in competition with the Business
in the field of hemodialysis therapy (including the development, manufacturing,
marketing, distribution or selling of products or any coating having a clinical
utility that is similar to that provided by any Product or Acquired Asset as of
the Closing Date for use in the field of hemodialysis therapy), whether directly
or indirectly, through any Affiliate, partnership, licensee, joint venture or
agent, or as a partner, owner, manager, operator, advisor, agent or consultant
of or to any Person. Notwithstanding the foregoing, nothing herein shall prevent
Seller, Parent, or any Seller Affiliate from (i) manufacturing, marketing,
distributing, selling or providing services with respect to any coating or other
technology for use outside the field of hemodialysis therapy, (ii) developing
any coating or other technology for use outside the field of hemodialysis
therapy that incidentally may also have application in the field of hemodialysis
therapy, provided that such developed
39
technology is not manufactured, marketed, distributed, sold or provided as a
service by Seller, Parent, or any Seller Affiliate within the field of
hemodialysis therapy, (iii) investing as a less than five percent (5%)
shareholder in the securities of any company listed on a national securities
exchange or quoted on an automated quotation system in which Seller, Parent, or
such Seller Affiliate does not, directly or indirectly, exercise any operational
or strategic control or otherwise participate in its management or operation, or
(iv) conducting research and development activities in accordance with, and
rendering those reports that are required by, that certain Research License,
effective as of May 20, 2007, as amended, by and between Selenium, Ltd. and
Seller.
(b) Non-Disparagement. Buyer shall not disparage the operation of
the Business prior to the Closing by Parent and Seller. Neither Parent nor
Seller shall disparage the operation of the Business following the Closing by
Buyer. Each Party agrees to refrain from (i) publicly making any defamatory
statements or remarks concerning any other Party hereto (or such other Party's
Affiliates) and (ii) making any other statement, oral or written, that subjects
any other Party hereto (or such other Party's Affiliates) to scorn, obloquy, or
ridicule. Notwithstanding the foregoing, nothing contained in this Section
6.07(b) shall prevent any of the Parties from making statements of comparison
regarding any coating or other technologies owned or licensed by one or more of
the Parties, provided that such statements are not prohibited by any applicable
Law.
(c) Agreements and Acknowledgements. Seller and Parent each hereby
agree that the covenants set forth in this Section 6.07 are reasonable under the
circumstances. Seller and Parent each hereby acknowledge and agree that it has
received sufficient consideration and other benefits hereunder and in connection
with the transactions contemplated by this Agreement to clearly justify the
restrictions contained in this Section 6.07. Each of Seller and Parent has
carefully considered the nature and extent of the restrictions placed upon it,
and hereby acknowledges and agrees that it has been advised by counsel that such
restrictions are reasonable in time, scope and geographic area and do not confer
a benefit upon Buyer disproportionate to the detriment of Seller, and/or Parent.
(d) Intent. The Parties recognize that the Laws and public
policies of various jurisdictions may differ as to the validity and
enforceability of covenants similar to those set forth in this Section 6.07. It
is the intention of the Parties that the provisions of this Section 6.07 be
enforced to the fullest extent permissible under the Laws and policies of each
jurisdiction in which enforcement may be sought, and that the unenforceability
(or the modification to conform to such Laws or policies) of any provisions of
this Section 6.07 shall not render unenforceable, or impair, the remainder of
the provisions of this Section 6.07. Accordingly, if at the time of enforcement
of any provision of this Section 6.07 a court of competent jurisdiction holds
that the restrictions stated herein are unreasonable under the circumstances
then existing, the Parties hereby agree that the maximum period, scope or
geographic area reasonable under such circumstances will be substituted for the
stated period, scope or geographical area and that such court shall be allowed
to apply to and to revise the restrictions contained herein to cover the maximum
period, scope and geographic area permitted by Law.
40
(e) No Challenge. Seller and Parent each covenant and agree that
it will not seek to challenge the enforceability of the covenants contained in
this Section 6.07, nor will it assert as a defense to any action seeking
enforcement of the provisions contained in this Section 6.07 (including an
action seeking injunctive relief) that such provisions are not enforceable due
to lack of sufficient consideration received by Seller or Parent, as applicable.
6.08 Certain Tax Matters.
(a) The Parties hereto agree that all real property Taxes,
personal property Taxes, and similar ad valorem obligations, as well as any
special assessments, that are levied with respect to the Acquired Assets or
Business for assessment or Tax periods within which the Closing Date occurs (the
"Apportioned Obligations") shall be apportioned between Seller and Parent, on
the one hand, and Buyer, on the other hand, based on the number of days in any
such period falling on or prior to the Closing Date, on the one hand, and the
number of days falling after the Closing Date, on the other hand, respectively.
Each of the Parties shall be responsible for and shall timely pay (or promptly
reimburse the other Party) with respect to its apportioned share of the
Apportioned Obligations. The Parties shall cooperate in timely making all
filings, returns, reports, and forms as may be required to comply with the
provisions of the relevant Tax Laws.
(b) Each of Parent and Seller shall bear and be responsible for,
and shall timely pay (or promptly reimburse Buyer with respect to) all sales,
use, transfer, documentary, recording, gains and similar Taxes and fees, and any
deficiency, interest or penalty asserted with respect thereof (collectively,
"Transfer Taxes") arising out of its sale or transfer of the Acquired Assets
pursuant to this Agreement. The Parties shall cooperate as to the filing of all
necessary documentation with respect to such Transfer Taxes.
(c) Except as otherwise provided in this Agreement, as between
Seller and Parent, on the one hand, and Buyer, on the other hand: (i) Seller and
Parent shall be responsible for and shall timely pay all Excluded Taxes; and
(ii) Buyer shall be responsible for and shall pay all Taxes levied or imposed in
connection with the ownership of the Acquired Assets and the operation of the
Business during periods after the Closing Date.
(d) Neither Seller nor Parent shall file an amended Tax Return or
make an election with respect to periods or portions thereof ending on or before
the Closing without the written consent of Buyer if the amendment or election
could adversely affect Buyer, the Business or the Acquired Assets.
(e) Seller and Parent shall retain originals (if not turned over
to Buyer) and copies of all Tax Returns, schedules, work papers, records and
other documents relating to Tax matters with respect to the Business and the
Acquired Assets until sixty (60) days after the expiration of the applicable
statute of limitations with respect to such Tax matters.
(f) Each Party shall provide each other Party with such assistance
as may reasonably be requested by any of them in connection with the preparation
of any filings with any taxing authorities (federal, state, local or otherwise)
and with any Action relating to
41
liability for Taxes, in either case in connection with the operation of the
Business or the Acquired Assets. Such assistance shall include making employees
available on a mutually convenient basis to provide information and explanation
of any material provided hereunder, and shall include providing copies of any
relevant information, data, reports, Tax Returns and supporting work schedules,
to the extent such is available. Buyer, on the one hand, and Seller and Parent,
on the other hand, each agree to reimburse one another for its reasonable
out-of-pocket expenses, such as travel costs, incurred by it, as the case may
be, in connection with performing obligations under this Section 6.08(f);
provided that such reimbursable expenses shall not include any per diem or other
expenses in the nature of salary replacement or overhead absorption measures.
6.09 Use of Names and Marks.
(a) Following the Closing Date, none of Seller, Parent and each
other Seller Affiliate shall transact business as, or use in the conduct of its
business or otherwise, the names and Trademarks included in the Acquired Assets,
or any other similar names, as applicable, throughout the world.
(b) Subject to Section 6.09(c), Buyer agrees that neither it nor
its Affiliates are licensed hereunder to use any Retained Names, including to
identify their goods or services, after the Closing Date.
(c) From and after the Closing Date, Seller and Parent hereby
license to Buyer and its Affiliates the right to use the Retained Names, on a
royalty-free, worldwide basis, in connection with their operation of the
Business (including the distribution of the Products (including labels and
packaging) and advertising or other Product literature that bear the Retained
Names) until such time as the Product Inventory and tangible copies of the
advertising and other Product literature transferred to Buyer at Closing are
exhausted. "Retained Names" means all Trademarks used in the Business as of the
Closing Date, except for the Trademarks included in the Acquired Assets.
6.10 Defense of Claims and Litigation. At all times following the
Closing Date, and without charge except for reimbursement of reasonable
out-of-pocket expenses (including legal fees and disbursements), each Party
shall consult, confer and cooperate in good faith on a reasonable basis with the
other Parties (including the making available of witnesses and cooperation in
discovery proceedings) in the conduct or defense of any Action against any such
other Party or any of its Affiliates by any third Person that relates to any
Acquired Asset or any Assumed Liability, whether known as of the Closing Date or
arising thereafter.
6.11 Retention of Records. For a period of seven (7) years following
the Closing Date, Seller and Parent each agrees to retain and cause the Seller
Affiliates to retain any material books, records, documents, instruments,
accounts, financial information, production records, employment records,
correspondence, writings, evidences of title and other papers and information
(i) relating to the Products and the Acquired Assets as such Person possessed or
controlled immediately on or before the Closing and did not transfer to Buyer
hereunder, and (ii)
42
relating to the performance by Seller and Parent of its respective obligations
under this Agreement and the other documents and instruments to be executed and
delivered pursuant hereto.
6.12 Sharing of Data. For a period of seven (7) years following the
Closing Date, Buyer shall have the right to have reasonable access to such
material books, records, documents, instruments, accounts, financial
information, production records, employment records, correspondence, writings,
evidences of title and other papers and information to the extent that they
relate to (i) the Products and the Acquired Assets as such Person possessed or
controlled immediately on or before the Closing and did not transfer to Buyer
hereunder, and (ii) the performance by Seller and Parent of its respective
obligations under this Agreement and the other documents and instruments to be
executed and delivered pursuant hereto. For a period of seven (7) years
following the Closing Date, Seller and Parent shall have the right to have
reasonable access to such material books, records, documents, instruments,
accounts, financial information, production records, employment records,
correspondence, writings, evidence of title and other papers and information
that are transferred to Buyer pursuant to the terms of the Agreement.
6.13 Product Liability. Each Party shall be responsible for Product
Liability with respect to the Products as follows:
(a) Seller and Parent shall be jointly and severally responsible
for any and all Product Liability involving Product that is substantially
manufactured, ready for sale or sold on or prior to the Closing Date, which
shall be considered Excluded Liabilities for purposes of this Agreement; and
(b) Buyer shall be responsible for any and all Product Liability
involving Product that is not contemplated by Section 6.13(a), which shall be
considered Assumed Liabilities for purposes of this Agreement.
With respect to any Product Liability that a Party is responsible for under this
Section 6.13, such Party shall indemnify the other Party or Parties in
accordance with Article VII.
6.14 Chargebacks, Rebates, Administrative Fees, and Returns. Following
the Closing, Buyer agrees to accept for return or replacement, or pay any
chargeback, administrative fee, rebate, discount, in all cases, with regard to
any Product sold by Seller on or prior to the Closing Date, in each case, in
accordance with the Spire Return and Replacement Policy set forth on Schedule
6.14, as applicable, subject to Seller and Parent being jointly and severally
responsible for all such costs, expenses and amounts paid or borne by Buyer in
connection therewith and reimbursing Buyer within thirty (30) days after the
receipt of an invoice for all such costs, expenses and amounts incurred by
Buyer, together with the documentation reasonably required to verify the same.
Buyer shall be responsible for all chargebacks, administrative fees, rebates,
discounts and returns of or attributable to Products sold by Buyer after the
Closing Date.
6.15 Transfer of Permits. As promptly as possible following the
Closing, but not later than thirty (30) days thereafter, Seller and Parent
shall, and shall cause the Seller Affiliates to, take all actions necessary to
effect the transfer of the Permits to Buyer (except for the Excluded Permits
identified on Schedule 4.08(a)), including the submission of the Notified Body
43
Letters and other notices or filings required to be made to any applicable
Governmental Authority regarding such transfer.
6.16 Destruction of Excluded Inventory. As promptly as possible
following the Closing, but not later than thirty (30) days thereafter, Seller
and Parent shall, and shall cause the Seller Affiliates to, destroy all Excluded
Inventory in accordance with all applicable Laws and deliver to Buyer a
certificate executed by the Chief Executive Officer, Chief Financial Officer or
President of Seller or Parent certifying as to such destruction.
6.17 Delivery of Tangible Acquired Assets. Seller and Parent shall
cause the tangible Acquired Assets being transferred hereunder (including those
located at premises owned or controlled by third parties) to be ready and
available for delivery to Buyer on a schedule to be agreed to by the Parties.
Notwithstanding the foregoing, Buyer shall determine the manner in which it is
placed in actual possession and operating control of the tangible Acquired
Assets and any costs and expenses incurred in connection therewith (including
shipping costs) shall be borne by Buyer.
6.18 Covenants Not to ▇▇▇.
(a) Buyer agrees, on behalf of itself, its Affiliates, and its and
their respective directors, officers, employees, agents, successors and assigns
(collectively, the "Buyer Parties"), that it will not threaten, commence,
maintain or otherwise participate in any Action, whether at law or in equity,
against Seller, Parent, any other Seller Affiliate, or any director, officer,
employee, agent, successor or assign of any of them (collectively, the "Seller
Parties"), that any of the Buyer Parties have, had or may have had related to
(i) the failure or alleged failure by any of the Seller Parties to offer for
sale to Buyer or any Buyer Affiliate U.S. Patent No. 6,482,169 (the "▇▇▇▇▇
Patent"), (ii) the failure or alleged failure by Parent to properly discharge
the right of first purchase granted to Buyer pursuant to Section 20 of the
Semi-Exclusive License, and (iii) the distribution, marketing or sale of round
catheter products in the United States under the Semi-Exclusive License through
the distributors set forth in Schedule 4.24(b), in each case, which existed or
may have existed on or prior to the Closing Date. The covenant shall be fully
assignable by any Seller Party.
(b) Seller and Parent agree, on behalf themselves and the Seller
Parties, that they will not threaten, commence, maintain or otherwise
participate in any Action, whether at law or in equity, against any of the Buyer
Parties, that any of Seller Parties have, had or may have had related to the
infringement or alleged infringement by the Buyer Parties of the ▇▇▇▇▇ Patent,
which existed or may have existed on or prior to the Closing Date. This covenant
shall be fully assignable by any Buyer Party.
ARTICLE VII
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INDEMNITY
7.01 Survival. The representations and warranties made by any Party to
this Agreement shall survive the Closing for a period of eighteen (18) months
after the Closing
44
Date, at which time all such representations and warranties shall fully expire
and terminate, except that the representations and warranties set forth in (i)
Section 4.12 (Tax Liabilities) shall survive until six (6) months after the
expiration of the applicable statutory period of limitations (giving effect to
any waiver, mitigation or extension thereof), at which time such representations
and warranties will expire, (ii) Section 4.13 (Intellectual Property) shall
survive for a period of two (2) years after the Closing Date, at which time such
representations and warranties shall expire, and (iii) Section 4.01
(Organization and Qualification), Section 4.02 (Power and Authority), Section
4.03 (No Violation), Section 4.05 (Title), Section 4.22 (Brokers' Fees), Section
5.01 (Organization), Section 5.02 (Authority), Section 5.03 (No Violation), and
Section 5.05 (Broker's Fees) (such representations and warranties, together with
those set forth in Section 4.12, the "Special Representations") shall survive
the Closing indefinitely. All of the covenants and agreements made by any Party
in this Agreement contemplating performance after the Closing Date shall survive
the Closing Date in accordance with their terms, subject to the expiration of
the applicable statute of limitations for any claim relating thereto. Anything
herein to the contrary notwithstanding, if written notice is properly given
pursuant to this Article VII prior to expiration of a representation, warranty,
covenant or agreement with respect to any alleged or potential breach thereof to
which such indemnified Party is entitled to be indemnified hereunder, then such
provision (and the related obligations of the indemnifying Party under this
Article VII) shall survive, with respect to the subject matter of such written
notice only, until the applicable claim is finally resolved in accordance with
this Article VII.
7.02 Indemnity by Seller and Parent. Subject to the terms and
conditions of this Article VII, Seller and Parent hereby agree, jointly and
severally, to indemnify, defend and hold harmless Buyer and its Affiliates and
their respective officers, directors, employees, agents, successors and assigns
(collectively, the "Bard Indemnified Parties"), at any time after the Closing,
from and against all Damages, asserted against, resulting from, imposed upon,
sustained, suffered or incurred by any Bard Indemnified Party, directly or
indirectly, by reason of, arising or resulting from or related to: (i) all
Excluded Liabilities; (ii) the breach by Seller or Parent, as applicable, of any
representation or warranty of Seller or Parent, as applicable, contained in this
Agreement or in any certificate delivered to Buyer pursuant to this Agreement
(determined, except with respect to the representations and warranties contained
in Sections 4.17 and 4.25, without giving effect to any "materiality" or
Material Adverse Effect qualification set forth therein); (iii) the breach or
failure to perform by Seller or Parent, as applicable, of any covenant or
agreement of Seller or Parent, as applicable, contained in this Agreement; (iv)
any liability for brokerage or finders' fees or other commissions based on
agreements, arrangements or understandings made by Seller, Parent or any other
Seller Affiliate for services rendered for or on behalf of any of them in
connection with the transactions contemplated hereby; and (v) all Taxes of
another Person incurred with respect to the Acquired Assets or the Business for
taxable periods or portions thereof ending on or prior to the Closing Date
whether pursuant to Treasury Regulation 1.1502-6, as a transferee or successor,
contractually or otherwise.
7.03 Indemnity by Buyer. Subject to the terms and conditions of this
Article VII, Buyer hereby agrees to indemnify, defend and hold harmless Seller,
Parent, the other Seller Affiliates and their respective officers, directors,
employees, agents, successors and assigns (collectively, the "Spire Indemnified
Parties"), at any time after the Closing, from and
45
against all Damages asserted against, resulting from, imposed upon, sustained,
suffered or incurred by any Spire Indemnified Party, directly or indirectly, by
reason of, arising or resulting from or related to: (i) all Assumed Liabilities;
(ii) the breach of any representation or warranty of Buyer contained in this
Agreement or in any certificate delivered to Seller pursuant to this Agreement;
(iii) the breach or failure to perform by Buyer of any covenant or agreement of
Buyer contained in this Agreement; and (iv) any liability for brokerage or
finders' fees or other commissions based on agreements, arrangements or
understandings made by Buyer for services rendered for or on behalf of Buyer in
connection with the transactions contemplated hereby.
7.04 Indemnity Procedures. The following terms and conditions shall
govern the obligations and liabilities of the indemnifying Parties to indemnify
the indemnified Parties under Section 7.02 or Section 7.03:
(a) Third Party Claims.
(i) If any claim or demand for which an indemnified Party may
claim indemnity pursuant to Section 7.02 or Section 7.03, as the case may be, is
asserted against or sought to be collected from the indemnified Party by a third
party (a "Third-Party Claim"), then the indemnified Party shall give written
notice thereof to the indemnifying Party as promptly as practicable following
the receipt by the indemnified Party of the Third-Party Claim (the "Third-Party
Claim Notice"); provided that the failure so to notify the indemnifying Party
will not relieve the indemnifying Party from any liability it may have to the
indemnified Party under Section 7.02 or Section 7.03, as applicable, unless, and
then only to the extent, the failure so to notify results in the loss of
material rights or defenses.
(ii) The indemnifying Party shall have twenty (20) days from
the date on which the Third-Party Claim Notice is duly given (the "Notice
Period") to notify the indemnified Party whether or not the indemnifying Party
desires, at its sole cost and expense, to defend the indemnified Party against
the Third-Party Claim with counsel of its choice reasonably satisfactory to the
indemnified Party.
(iii) If the indemnifying Party notifies the indemnified Party
in writing within the Notice Period that it desires to defend the indemnified
Party against the Third-Party Claim, then (except as provided below) the
indemnifying Party shall defend, at its sole cost and expense, the indemnified
Party by appropriate proceedings, shall use commercially reasonable efforts to
settle or prosecute the proceedings to a final conclusion in such a manner as to
avoid the indemnified Party becoming subject to any injunctive or other
equitable order for relief, and shall control the conduct of such defense. The
indemnifying party shall not be entitled to assume the defense of any
Third-Party Claim if the Third-Party Claim seeks any relief other than money
damages, including any type of injunctive or other equitable relief. If the
indemnified Party shall have reasonably concluded that there are legal defenses
or rights available to it that are in conflict with those available to the
indemnifying Party, then the indemnified Party shall have the right to select
one law firm (in addition to local counsel) to act at the indemnifying Party's
expense as separate counsel, on behalf of the indemnified Party. If the
indemnified Party desires to participate in, but not control, any other defense
or settlement, it may do so at its sole cost and expense (subject to the
foregoing sentence). So long as the
46
indemnifying Party is defending in good faith any such Third-Party Claim, the
indemnified Party shall not settle such Third-Party Claim without the consent of
the indemnifying Party, which consent shall not be unreasonably withheld or
delayed.
(iv) The indemnifying Party will not consent to the entry of
any judgment or enter into any compromise or settlement with respect to a
Third-Party Claim without the prior written consent of the indemnified Party,
which consent shall not be unreasonably withheld or delayed; provided that the
consent of the indemnified Party shall not be required if (A) the indemnifying
Party agrees in writing to pay the entirety of any and all amounts payable
pursuant to or in connection with such judgment, compromise or settlement and
(B) such judgment, compromise or settlement (1) consists of only money damages
and no other form of relief, including any type of injunctive or other equitable
relief, (2) includes a complete release of the indemnified Party from further
liability and obligations, does not require any action or inaction on the part
of the indemnified Party and does not require the indemnified Party to admit
fault, and (3) is not likely to have an adverse effect on the indemnified Party
or otherwise establish a precedential custom or practice adverse to the
continuing business interests or the reputation of the indemnified Party.
(v) If the indemnifying Party fails to notify the indemnified
Party in writing within the Notice Period that the indemnifying Party desires to
defend the Third-Party Claim, or if the indemnifying Party gives such notice but
fails to prosecute actively and diligently or settle the Third-Party Claim, or
if the indemnified Party determines in good faith that there is a reasonable
possibility that a proceeding may affect it other than as a result of monetary
damages for which it would be entitled to indemnification hereunder, then the
indemnified Party will have the right to defend, at the sole cost and expense of
the indemnifying Party, such Third-Party Claim to a final conclusion or to
settle such Third-Party Claim at the discretion of the indemnified Party (with
the consent of the indemnifying Party, which consent shall not be unreasonably
withheld or delayed). The indemnifying Party may elect to participate in such
proceedings, negotiations or defense at any time at its own expense. The
indemnified Party will have full control of such defense and proceedings,
including (except as provided in the immediately preceding sentence) any
settlement thereof.
(b) Tax Contests. Each of Seller, Parent and Buyer shall notify
the other Parties in writing within thirty (30) calendar days of its receipt of
written notice of any pending or threatened Tax examination, audit or other
administrative or judicial proceeding (a "Tax Contest") that could reasonably be
expected to result in an indemnification obligation under Section 7.02 or
Section 7.03 of such other Party pursuant to this Section 7.04(b). If the
recipient of such notice of a Tax Contest fails to provide such notice to the
other Parties, it shall not be entitled to indemnification for any Taxes arising
in connection with such Tax Contest, but only to the extent, if any, that such
failure or delay shall have actually prejudiced the indemnifying Party. If a Tax
Contest relates to any Tax period ending on or prior to the Closing Date or to
any Taxes for which Seller or Parent is liable in full hereunder, Seller or
Parent, as the case may be, shall at its expense control the defense and
settlement of such Tax Contest; provided that (i) Buyer shall be entitled to
participate in such Tax Contest at its own expense, and (ii) Seller and Parent
shall keep Buyer fully informed of any material developments, provide Buyer with
copies of all material correspondence, and allow Buyer to observe the conduct of
any
47
Tax Contest (through attendance at meetings) at Buyer's expense, including
through Buyer's own counsel and/or other professional experts. Buyer shall
control the defense and settlement of all other Tax Contests; provided that
Seller and Parent shall be entitled to participate (at their own expense), and
Buyer shall not settle, without the prior written consent of Seller or Parent
(which consent shall not be unreasonably withheld or delayed), any such Tax
Contest that could reasonably be expected to result in liability of Seller or
Parent pursuant to the terms of this Agreement.
7.05 Limitations.
(a) Notwithstanding anything to the contrary contained in this
Agreement, (i) except as further limited by Section 7.05(b) below, the aggregate
liability of Seller and Parent for any and all claims for indemnification under
Section 7.02(ii) (other than with respect to a breach of any of the Special
Representations) shall not exceed the Purchase Price, and (ii) Seller and Parent
shall not be liable under Section 7.02(ii) (other than with respect to a breach
of any of the Special Representations) unless and until the aggregate of all
such Damages exceed one percent (1%) of the Purchase Price, at which point
Seller and Parent shall be liable for all Damages relating back to the first
dollar.
(b) Notwithstanding anything to the contrary contained in this
Agreement, the aggregate liability of Seller and Parent for any and all
Permitted Claims (as defined below) for indemnification under Section 7.02(ii)
shall not exceed Ten Million Dollars ($10,000,000), and in no event shall
Seller's and Parent aggregate liability for any Permitted Claim exceed the fees
and expenses of counsel, advisors and experts incurred by Buyer or any Buyer
Affiliate in connection with defending a Litigated Patent (as defined below).
For the purposes of this Section 7.05(b), a "Permitted Claim" means a claim for
Damages related to any claim or counterclaim (i) that is asserted by a third
party and that if adversely determined against Buyer or any Buyer Affiliate
could result in the invalidity of a Litigated Patent, and (ii) that is asserted
in response to Buyer or any Buyer Affiliate having first made a claim against
such third party for infringement of any claim of a Patent included in the
Purchased Intellectual Property (the "Litigated Patent").
(c) Notwithstanding anything to the contrary contained in this
Agreement, (i) the aggregate liability of Buyer for any and all claims for
indemnification under Section 7.03(ii) (other than with respect to a breach of
any of the Special Representations) shall not exceed the Purchase Price, and
(ii) Buyer shall not be liable under Section 7.03(ii) (other than with respect
to a breach of any of the Special Representations) unless and until the
aggregate of all such Damages exceed one percent (1%) of the Purchase Price, at
which point Buyer shall be liable for all Damages relating back to the first
dollar.
(d) The right of the Parties hereto to demand and receive
indemnification pursuant to this Article VII shall be the sole and exclusive
remedy exercisable by a Party with respect to any claim arising out of or
relating to this Agreement, other than claims with respect to a breach of the
provisions of Section 6.01(e), 6.06 or 6.07 or claims arising out of fraud or
willful breach of this Agreement. Notwithstanding the foregoing, nothing herein
shall preclude any Party
48
from seeking any rights or remedies (including equitable relief) under any other
agreements executed and delivered in connection herewith.
7.06 Third Party Beneficiaries. The Bard Indemnified Parties and the
Spire Indemnified Parties are intended to be third party beneficiaries of the
rights granted under this Article VII and to have the right to enforce such
rights directly against the applicable indemnifying Party.
7.07 Tax Treatment of Indemnity Payments. Any payment pursuant to this
Article VII shall be considered an adjustment to the Purchase Price for tax
purposes.
7.08 Updates to Seller Disclosure Schedules. For purposes of this
entire Article VII, if the Closing occurs, the representations and warranties of
Parent and Seller shall be read together with and shall be updated by any
Disclosure Supplement delivered to Buyer prior to the Closing to the extent that
such Disclosure Supplement discloses a fact or event occurring solely after the
date of this Agreement that, if existing at the date of this Agreement, would
have been required to be set forth in the Seller Disclosure Schedules in order
for the representation and warranties set forth in this Agreement to be true and
correct. Notwithstanding the foregoing, to the extent that such Disclosure
Supplement corrects any inaccuracy contained in the Seller Disclosure Schedules
as of the date of this Agreement, such inaccuracy shall not be updated by such
Disclosure Supplement for purposes of this Article VII.
ARTICLE VIII
------------
CLOSING CONDITIONS
8.01 Conditions to Buyer's Obligation. Buyer's obligation to consummate
the transactions to be performed by it in connection with the Closing is subject
to satisfaction (or written waiver by Buyer) of the following conditions:
(a) the representations and warranties of Seller and Parent set
forth in this Agreement (including the Schedules) shall be true and correct in
all material respects, with respect to representations and warranties not
qualified by materiality or Material Adverse Effect, or in all respects, with
respect to representations and warranties qualified by materiality or Material
Adverse Effect, in each case, as of the date hereof and at and as of the Closing
Date as though made on and as of the Closing Date;
(b) Seller and Parent shall have performed and complied with all
covenants and agreements hereunder applicable to them in all material respects
through the Closing, except to the extent that such covenants or agreements are
qualified by materiality or Material Adverse Effect, in which case Seller and
Parent shall have performed and complied with all such covenants or agreements
in all respects through the Closing;
(c) Seller and Parent shall have given and delivered to Buyer all
notices, made and delivered to Buyer all registrations and filings, and procured
and delivered to
49
Buyer all of the authorizations, consents, approvals, orders and declarations
that, in each case, are set forth in Schedule 4.04;
(d) since the date hereof, there shall not have been any event,
change, circumstance, condition, development or effect that has caused or could
reasonably be expected to cause a Material Adverse Effect;
(e) there shall be no effective or pending Action, Law or Order
that could reasonably be expected to (i) prevent consummation of any of the
transactions contemplated by this Agreement, (ii) cause any of the transactions
contemplated by this Agreement to be rescinded following consummation, (iii)
adversely affect the right of Buyer to own the Acquired Assets, or (iv)
adversely affect the right of Buyer or any of its Affiliates to own its assets
and to operate its businesses;
(f) Seller and Parent shall have delivered to Buyer all
deliverables specified in Section 3.02; and
(g) Seller and Parent shall have delivered to Buyer a true,
correct and complete copy of an amended and restated exclusive supply and
service agreement, in form and substance reasonably acceptable to Buyer, duly
executed by Seller and Carmeda AB, and the matters referenced in Schedule
8.01(g) shall be true and correct.
8.02 Conditions to Seller's and Parent's Obligations. Seller's and
Parent's obligation to consummate the transactions to be performed by them in
connection with the Closing is subject to satisfaction (or written waiver by
Seller or Parent) of the following conditions:
(a) the representations and warranties of Buyer set forth in this
Agreement (including the Schedules) shall be true and correct in all material
respects, with respect to representations and warranties not qualified by
materiality or Material Adverse Effect, or in all respects, with respect to
representations and warranties qualified by materiality or Material Adverse
Effect, in each case, as of the date hereof and at and as of the Closing Date as
though made on and as of the Closing Date;
(b) Buyer shall have performed and complied with all of its
covenants and agreements hereunder in all material respects through the Closing,
except to the extent that such covenants or agreements are qualified by
materiality or Material Adverse Effect, in which case Buyer shall have performed
and complied with all of such covenants or agreements in all respects through
the Closing;
(c) Seller and Parent shall have received the consent of Silicon
Valley Bank with respect to Seller's and Parent's execution and delivery of this
Agreement and the consummation by Seller and Parent of the transactions
contemplated hereby;
(d) there shall be no effective or pending Action, Law or Order
that could reasonably be expected to (i) prevent consummation of any of the
transactions
50
contemplated by this Agreement, or (ii) cause any of the transactions
contemplated by this Agreement to be rescinded following consummation; and
(e) Buyer shall have delivered to Seller and Parent all
deliverables specified in Section 3.03.
ARTICLE IX
----------
TERMINATION
9.01 Termination of Agreement. This Agreement may be terminated and the
transactions contemplated hereby abandoned at any time prior to the Closing
Date:
(a) by the joint written consent of Buyer, on the one hand, and
Seller and Parent, on the other hand;
(b) by Buyer if any of the conditions set forth in Section 8.01
shall have become incapable of fulfillment and shall not have been waived in
writing by Buyer;
(c) by Seller or Parent if any of the conditions set forth in
Section 8.02 shall have become incapable of fulfillment and shall not have been
waived in writing by Seller or Parent;
(d) by any Party hereto if the Closing does not occur on or prior
to September 30, 2009; or
(e) subject to Section 9.01(d), by (i) Buyer in the event that
Seller or Parent has breached any representation, warranty, covenant or
agreement contained herein in any material respect (if not qualified by
materiality or Material Adverse Effect) or in any respect (if qualified by
materiality or Material Adverse Effect), Buyer has notified Seller and Parent of
the breach, and the breach has continued without cure for a period of ten (10)
days after the notice of such breach, or (ii) Seller or Parent in the event that
Buyer has breached any representation, warranty, covenant or agreement contained
herein in any material respect (if not qualified by materiality or Material
Adverse Effect) or in any respect (if qualified by materiality or Material
Adverse Effect), Seller and Parent have notified Buyer of the breach, and the
breach has continued without cure for a period of ten (10) days after the notice
of such breach;
provided, that the Party seeking termination pursuant to clause (b), (c), (d) or
(e) is not in breach of any representation, warranty, covenant or agreement
contained herein in any material respect (if not qualified by materiality or
Material Adverse Effect) or in any respect (if qualified by materiality or
Material Adverse Effect).
9.02 Effect of Termination. In the event of termination by Buyer,
Seller or Parent pursuant to Section 9.01(b), (c), (d) or (e), written notice
thereof shall forthwith be given to the other Parties and the transactions
contemplated by this Agreement shall be terminated, without further action by
any Party. If this Agreement is validly terminated and the transactions
51
contemplated hereby are abandoned as described in this Article IX, this
Agreement shall become void and of no further force or effect, except for the
provisions of (i) the Confidentiality Agreement, (ii) Section 6.02 relating to
public announcements, (iii) Section 6.04 relating to certain expenses and (iv)
this Article IX. Nothing in this Article IX shall be deemed to release any Party
from any liability for any breach by such Party of the terms and provisions of
this Agreement.
ARTICLE X
---------
MISCELLANEOUS
10.01 Binding Effect; Assignment; No Third-Party Rights. This Agreement
shall be binding upon and shall inure to the benefit of, and be enforceable by,
the Parties and their permitted successors and assigns. This Agreement may not
be assigned by any Party without the prior written consent of the other Parties;
provided that Buyer may (i) assign any or all of its rights and interests
hereunder to one or more of its Affiliates, (ii) designate one or more of its
Affiliates to perform its obligations hereunder (in any or all of which cases
Buyer nonetheless shall remain responsible for the performance of all of its
obligations hereunder), or (iii) assign any or all of its rights and interest
hereunder to a purchaser or assignee of all or substantially all of Buyer's
assets or business. Except as set forth in Section 7.06, nothing herein is
intended to, nor shall it, create any rights in any Person other than the
Parties and their respective successors and assigns.
10.02 Entire Agreement. This Agreement (including the Exhibits and
Schedules and any Annexes hereto), together with the documents incorporated by
reference and the agreements to be executed in connection herewith and, subject
to Section 6.06(b), the Confidentiality Agreement, sets forth the entire
agreement and understanding of the Parties in respect of the transactions
contemplated hereby and supersedes all prior agreements, arrangements and
understandings relating to the subject matter hereof and thereof.
10.03 Notices. All notices, requests, demands, claims and other
communications that are required or may be given pursuant to this Agreement must
be in writing and delivered personally against written receipt, by facsimile or
by reputable domestic or international overnight courier to the Parties at the
following addresses (or to the attention of such other Person or at such other
address as any party may provide to the other party by like notice in accordance
with this Section 10.03):
If to Seller or Parent: Spire Corporation
Spire Biomedical, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇▇, Chief Executive
Officer of Spire Biomedical,
Inc. and ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Esq., Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
52
with a required copy to:
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ & Fish, LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
If to Buyer: Bard Access Systems, Inc.
▇▇▇ ▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
Attention: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with required copies to:
▇. ▇. ▇▇▇▇, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Office of the General Counsel
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
Any such notice, request, demand, claim or other communication will be deemed to
have been given (a) if personally delivered, when so delivered, (b) if sent by
facsimile, upon transmission with electronic confirmation thereof, or (c) if
sent by reputable domestic or international overnight courier, when received.
10.04 Severability. If any provision of this Agreement, including any
phrase, sentence, clause, section or subsection is inoperative or unenforceable
for any reason, such circumstances shall not have the effect of rendering the
provision in question inoperative or unenforceable in any other case or
circumstance, or of rendering any other provision or provisions herein contained
invalid, inoperative, or unenforceable to any extent whatsoever. The Parties
agree that the terms and provisions of this Agreement are reasonable covenants
under the circumstances, and further agree that if, in the opinion of any court
of competent jurisdiction any such term or provision is unreasonable in any
respect, such court shall have the right, power and authority to excise or
modify such term or provision to effectuate the Parties' intent and to enforce
the remainder thereof as so amended.
53
10.05 Amendment; Waiver, etc. No amendment, modification, or waiver
hereunder shall be valid or binding unless set forth in writing and duly
executed by the Party against whom enforcement of the amendment, modification,
or waiver is sought. Any such waiver shall constitute a waiver only with respect
to the specific matter described in such writing and shall in no way impair the
rights of the Party granting such waiver in any other respect or at any other
time. No waiver by any Party of a breach of or a default under any of provision
of this Agreement shall be construed as a waiver of any other breach or default
of a similar nature, or as a waiver of any of such provisions, rights or
privileges hereunder. No failure or delay by any Party to enforce any provision
of this Agreement or to exercise any right or privilege hereunder shall
constitute a waiver of such right or privilege.
10.06 Governing Law; Consent to Jurisdiction.
(a) This Agreement will be governed by and construed and
interpreted in accordance with the substantive Laws of the State of New York.
(b) All judicial proceedings brought against any Party arising out
of or relating to this Agreement, or any obligations hereunder, may be brought
in any state court of competent jurisdiction in the State of New York, County of
New York, or any federal court of competent jurisdiction in the Southern
District of New York. By executing and delivering this Agreement, each Party,
for itself and in connection with its properties, irrevocably (i) accepts
generally and unconditionally the nonexclusive jurisdiction and venue of such
courts, (ii) waives any defense of forum non coveniens, (iii) agrees that
service of all process in any such proceeding in any such court may be made by
registered or certified mail, return receipt requested, to such Party at its
address provided in accordance with Section 10.04 hereof or other address in the
possession of the sending Party, (iv) agrees that service as provided in clause
(iii) above is sufficient to confer personal jurisdiction over such Party in any
such proceeding in any such court, and otherwise constitutes effective and
binding service in every respect and (v) agrees that the rights to serve process
and bring proceedings provided above shall be in addition to any other rights to
serve process in any other manner permitted by Law and to bring proceedings in
the courts of any other jurisdiction.
10.07 Waiver of Trial By Jury. EACH PARTY WAIVES THE RIGHT TO TRIAL BY
JURY AND REPRESENTS TO THE OTHER THAT IT HAS REVIEWED THE FOREGOING WAIVER WITH
ITS COUNSEL AND THAT IT HAS KNOWINGLY AND VOLUNTARILY WAIVED ITS RIGHT TO TRIAL
BY JURY AFTER CONSULTATION WITH SUCH COUNSEL.
10.08 Counterparts. This Agreement may be executed by facsimile or
other electronically-scanned signature pages and in one or more counterparts,
each of which shall be deemed an original, but all of which together will
constitute one and the same instrument.
10.09 Neutral Construction. The Parties hereto have participated
jointly in the negotiation and drafting of this Agreement. In the event an
ambiguity or question of intent or interpretation arises, this Agreement shall
be construed as if drafted jointly by the Parties and
54
no presumption or burden of proof shall arise favoring or disfavoring any Party
by virtue of the authorship of any of the provisions of this Agreement.
10.10 Inducement; Specific Performance. Seller and Parent each
acknowledge that the covenants set forth in Section 6.01(e), Section 6.06 and
Section 6.07 are a condition precedent to the execution of this Agreement and
the consummation of the transactions contemplated hereby by the Parties. In
addition, the Parties acknowledge and agree that the covenants contained in
Section 6.01(e), Section 6.06 and Section 6.07 are an integral part of the
transactions contemplated by this Agreement and are a material inducement for
Buyer to enter into this Agreement and to perform its obligations hereunder. The
Parties recognize and acknowledge that any breach of Section 6.01(e), a breach
by any Seller Recipient of Section 6.06 or a breach by Seller or Parent of
Section 6.07 will cause irreparable and material loss and damage to Buyer, the
amount of which cannot be readily determined and as to which it will not have an
adequate remedy at law or in damages. Accordingly, in addition to any remedy
Buyer may have in damages by an action at law, Buyer shall be entitled to the
issuance of an injunction restraining any such breach or any other remedy at law
or in equity for any such breach. The remedy in this Section 10.10 is in
addition to, and not in lieu of, any other rights and remedies that Buyer may
have.
10.11 Interpretation. For purposes of this Agreement, except as
otherwise expressly provided herein or unless the context otherwise requires:
(i) words using the singular or plural number also include the plural or
singular number, respectively, and the use of any gender herein shall be deemed
to include the other gender; (ii) references herein to "Articles," "Sections,"
"subsections" and other subdivisions without reference to a document are to the
specified Articles, Sections, subsections and other subdivisions of this
Agreement; (iii) a reference to a subsection without further reference to a
Section is a reference to such subsection as contained in the same Section in
which the reference appears, and this rule shall also apply to other
subdivisions within a Section or subsection; (iv) the words "herein," "hereof,"
"hereunder," "hereby" and other words of similar import refer to this Agreement
(including the Exhibits and Schedules and any Annexes hereto) as a whole and not
to any particular provision; (v) any reference to any federal, state, county,
local, foreign or multinational statute or law shall be deemed also to refer to
all rules and regulations promulgated thereunder, unless the context requires
otherwise; (vi) the words "include," "includes" and "including" are deemed to be
followed by the phrase "without limitation;" (vii) the words "ordinary course of
business," "ordinary course of the Business" or similar constructions thereof
are deemed to be followed by the phrase "consistent with past practices;" and
(viii) the section and other headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. All accounting terms used herein and not
expressly defined herein shall have the meanings given to them under GAAP.
[Signature Page Follows]
55
IN WITNESS WHEREOF, each of the Parties hereto has caused this
Agreement to be executed by its duly authorized representative as of the day and
year first above written.
SELLER:
SPIRE BIOMEDICAL, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: CEO, Spire Biomedical
PARENT:
SPIRE CORPORATION
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Chairman & CEO
BUYER:
BARD ACCESS SYSTEMS, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
----------------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇
Title: Vice President