Exhibit 2.1
EXECUTION COPY
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AMENDED AND RESTATED
AGREEMENT AND PLAN OF MERGER
Dated as of November 14, 2005
Among
JOHNSON & JOHNSON,
SHELBY MERGER SUB, INC.
And
GUIDANT CORPORATION
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TABLE OF CONTENTS
Page
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ARTICLE I
The Merger
SECTION 1.01. The
Merger...................................................1
SECTION 1.02.
Closing......................................................2
SECTION 1.03. Effective
Time...............................................2
SECTION 1.04. Effects of the
Merger........................................2
SECTION 1.05. Articles of
Incorporation and By-laws........................2
SECTION 1.06.
Directors....................................................2
SECTION 1.07.
Officers.....................................................2
ARTICLE II
Effect of the Merger on the
Capital Stock of the Constituent Corporations;
Exchange of
Certificates
SECTION 2.01. Effect on
Capital Stock......................................3
SECTION 2.02. Exchange of
Certificates.....................................4
ARTICLE III
Representations and Warranties
SECTION 3.01. Representations
and Warranties of the Company................7
SECTION 3.02. Representations
and Warranties of Parent and Sub............27
ARTICLE IV
Covenants Relating to Conduct of Business; No Solicitation
SECTION 4.01. Conduct of
Business.........................................32
SECTION 4.02. No
Solicitation.............................................37
ARTICLE V
Additional Agreements
SECTION 5.01. Preparation of
the Form S-4 and the Proxy Statement;
Shareholders' Meeting.......................................40
SECTION 5.02. Access to
Information; Confidentiality......................41
SECTION 5.03. Reasonable Best
Efforts.....................................42
SECTION 5.04. Company Stock
Options; ESPP.................................43
SECTION 5.05. Indemnification,
Exculpation and Insurance..................45
SECTION 5.06. Fees and
Expenses...........................................46
SECTION 5.07. Public
Announcements........................................47
SECTION 5.08.
Affiliates..................................................48
SECTION 5.09. Stock Exchange
Listing......................................48
SECTION 5.10. Shareholder
Litigation......................................48
SECTION 5.11. Employee
Matters............................................48
SECTION 5.12. Company
Notes...............................................50
SECTION 5.13. Rights
Agreement............................................50
ARTICLE VI
Conditions Precedent
SECTION 6.01. Conditions to
Each Party's Obligation to Effect the Merger..50
SECTION 6.02. Conditions to
Obligations of Parent and Sub.................51
SECTION 6.03. Conditions to
Obligation of the Company.....................52
SECTION 6.04. Frustration of
Closing Conditions...........................52
ARTICLE VII
Termination, Amendment and Waiver
SECTION 7.01.
Termination.................................................53
SECTION 7.02. Effect of
Termination.......................................54
SECTION 7.03.
Amendment...................................................54
SECTION 7.04. Extension;
Waiver...........................................54
SECTION 7.05. Procedure for
Termination or Amendment......................54
ARTICLE VIII
General Provisions
SECTION 8.01. Nonsurvival of
Representations and Warranties...............54
SECTION 8.02.
Notices.....................................................55
SECTION 8.03.
Definitions.................................................56
SECTION 8.04.
Interpretation..............................................57
SECTION 8.05. Consents and
Approvals......................................57
SECTION 8.06.
Counterparts................................................58
SECTION 8.07. Entire
Agreement; No Third-Party Beneficiaries..............58
SECTION 8.08. GOVERNING
LAW...............................................58
SECTION 8.09.
Assignment..................................................58
SECTION 8.10. Specific
Enforcement; Consent to Jurisdiction...............58
SECTION 8.11. Waiver of Jury
Trial........................................58
SECTION 8.12.
Severability................................................59
Annex I
Index of Defined Terms
Exhibit A Restated
Articles of Incorporation of the Surviving Corporation
Exhibit B Affiliate
Letter
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AMENDED AND RESTATED AGREEMENT AND PLAN OF MERGER (this
"Agreement")
dated as of November 14, 2005, among
JOHNSON & JOHNSON, a New Jersey corporation
("Parent"), SHELBY MERGER SUB, INC., an
Indiana corporation and a wholly owned
Subsidiary of Parent ("Sub"), and GUIDANT
CORPORATION, an Indiana corporation
(the "Company").
WHEREAS Parent, Sub and the Company entered into an Agreement and
Plan
of Merger dated as of December 15, 2004
(the "Original Merger Agreement"), and
they now desire to amend and restate the
Original Merger Agreement (it being
understood that all references to "the date
hereof" or "the date of this
Agreement" refer to December 15, 2004);
WHEREAS the Board of Directors of each of the Company and Sub
has
adopted, and the Board of Directors of
Parent has approved, this Agreement and
the merger of Sub with and into the Company
(the "Merger"), upon the terms and
subject to the conditions set forth in this
Agreement, whereby each issued and
outstanding share of common stock, without
par value, of the Company ("Company
Common Stock"), other than shares of
Company Common Stock directly owned by
Parent, Sub or the Company, will be
converted into the right to receive (a) a
number of validly issued, fully paid and
nonassessable shares of common stock,
par value $1.00 per share, of Parent
("Parent Common Stock") and (b) $33.25 in
cash, without interest;
WHEREAS simultaneously with the execution and delivery of this
Agreement, Parent and the Company are
entering into a Settlement Agreement for
the purpose of permanently settling and
resolving any and all claims, disputes,
issues or matters that exist between them
relating to the matters contemplated
by the Original Merger Agreement or raised
by the litigation filed by the
Company with respect to the Original Merger
Agreement, and agreeing to dismiss
such litigation with prejudice; and
WHEREAS Parent, Sub and the Company desire to make certain
representations, warranties, covenants and
agreements in connection with the
Merger and also to prescribe various
conditions to the Merger.
NOW, THEREFORE, in consideration of the representations,
warranties,
covenants and agreements contained in this
Agreement, and subject to the
conditions set forth herein, the parties
hereto agree as follows:
ARTICLE I
The Merger
SECTION 1.01. The Merger. Upon the terms and subject to the
conditions
set forth in this Agreement, and in
accordance with the Business Corporation Law
of the State of Indiana (the "IBCL"), Sub
shall be merged with and into the
Company at the Effective Time. Following
the Effective Time, the separate
corporate existence of Sub shall cease and
the Company shall continue as the
surviving corporation in the Merger (the
"Surviving Corporation") and shall
succeed to and assume all the rights and
obligations of Sub in accordance with
the IBCL.
SECTION 1.02. Closing. The closing of the Merger (the "Closing")
will
take place at 10:00 a.m. on a date to be
specified by the parties, which shall
be no later than the second business day
after satisfaction or (to the extent
permitted by applicable Law) waiver of the
conditions set forth in Article VI
(other than those conditions that by their
terms are to be satisfied at the
Closing, but subject to the satisfaction or
(to the extent permitted by
applicable Law) waiver of those
conditions), at the offices of Cravath, Swaine &
Moore LLP, Worldwide Plaza, 825 Eighth
Avenue, New York, New York 10019, unless
another time, date or place is agreed to in
writing by Parent and the Company;
provided, however, that if all the
conditions set forth in Article VI shall no
longer be satisfied or (to the extent
permitted by applicable Law) waived on
such second business day, then the Closing
shall take place on the first
business day on which all such conditions
shall again have been satisfied or (to
the extent permitted by applicable Law)
waived unless another time is agreed to
in writing by Parent and the Company. The
date on which the Closing occurs is
referred to in this Agreement as the
"Closing Date".
SECTION 1.03. Effective Time. Subject to
the provisions of this Agreement, as
soon as practicable on the Closing Date,
the parties shall file with the
Secretary of State of the State of Indiana
articles of merger (the "Articles of
Merger") executed and acknowledged by the
parties in accordance with the
relevant provisions of the IBCL and, as
soon as practicable on or after the
Closing Date, shall make all other filings or recordings required
under
the
IBCL. The Merger shall become effective
upon the filing of the Articles of
Merger with the Secretary of State of the
State of Indiana, or at such later
time as Parent and the Company shall agree
and shall specify in the Articles of
Merger (the time the Merger becomes
effective being the "Effective Time").
SECTION 1.04. Effects of the Merger. The Merger shall have the
effects
set forth in Section 23-1-40-6 of the
IBCL.
SECTION 1.05. Articles of Incorporation and By-laws. (a) The
Articles
of Incorporation of the Company (the
"Company Articles") shall be amended at the
Effective Time to be in the form of Exhibit
A and, as so amended, such Company
Articles shall be the Restated Articles of
Incorporation of the Surviving
Corporation until thereafter changed or
amended as provided therein or by
applicable Law.
(b) The By-laws of Sub, as in effect immediately prior to the
Effective
Time, shall be the By-laws of the Surviving
Corporation until thereafter changed
or amended as provided therein or by
applicable Law.
SECTION 1.06. Directors. The directors of Sub immediately prior to
the
Effective Time shall be the directors of
the Surviving Corporation until the
earlier of their resignation or removal or
until their respective successors are
duly elected and qualified, as the case may
be.
SECTION 1.07. Officers. The officers of the Company immediately
prior
to the Effective Time shall be the officers
of the Surviving Corporation until
the earlier of their resignation or removal
or until their respective successors
are duly elected and qualified, as the case
may be.
ARTICLE II
Effect of the Merger on the Capital Stock of the
Constituent Corporations; Exchange of Certificates
SECTION 2.01. Effect on Capital Stock. At the Effective Time, by
virtue
of the Merger and without any action on the
part of the holder of any shares of
Company Common Stock or any shares of
capital stock of Parent or Sub:
(a) Capital Stock of Sub. Each issued and outstanding share of
capital
stock of Sub shall be converted into and
become one validly issued, fully paid
and nonassessable share of common stock,
without par value, of the Surviving
Corporation.
(b) Cancelation of Treasury Stock and Parent-Owned Stock. Each
share of
Company Common Stock that is directly owned
by the Company, Parent or Sub
immediately prior to the Effective Time
shall automatically be canceled and
shall cease to exist, and no consideration
shall be delivered in exchange
therefor.
(c) Conversion of Company Common Stock. Subject to Section
2.02(e),
each share of Company Common Stock issued
and outstanding immediately prior to
the Effective Time (other than shares to be
canceled in accordance with Section
2.01(b)) shall be converted into the right
to receive (i) 0.493 (the "Exchange
Ratio") validly issued, fully paid and
nonassessable shares of Parent Common
Stock (the "Stock Portion") and (ii) $33.25
in cash, without interest (the "Cash
Portion" and, together with the Stock
Portion, the "Merger Consideration"). At
the Effective Time, all such shares of
Company Common Stock shall no longer be
outstanding and shall automatically be
canceled and shall cease to exist, and
each holder of a certificate which
immediately prior to the Effective Time
represented any such shares of Company
Common Stock (each, a "Certificate")
shall cease to have any rights with respect
thereto, except the right to receive
the Merger Consideration, any dividends or
other distributions payable pursuant
to Section 2.02(c) and cash in lieu of any
fractional shares payable pursuant to
Section 2.02(e), in each case to be issued
or paid in consideration therefor
upon surrender of such Certificate in
accordance with Section 2.02(b), without
interest. Notwithstanding the foregoing, if
between the date of this Agreement
and the Effective Time, (A) the outstanding
shares of Parent Common Stock shall
have been changed into a different number
of shares or a different class, by
reason of the occurrence or record date of
any stock dividend, subdivision,
reclassification, recapitalization, split,
combination, exchange of shares or
similar transaction, (B) Parent declares or
pays cash dividends in any fiscal
quarter in excess of 200% of the amount of
regularly quarterly dividends paid by
the Parent immediately prior to the date
hereof or (C) Parent engages in any
spin-off or split-off, then in any such
case the Exchange Ratio shall be
appropriately adjusted to reflect such
action. The right of any holder of a
Certificate to receive the Merger
Consideration, any dividends or other
distributions payable pursuant to Section
2.02(c) and cash in lieu of any
fractional shares payable pursuant to
Section 2.02(e) shall be subject to and
reduced by the amount of any withholding
that is required under applicable tax
Law.
SECTION 2.02. Exchange of Certificates. (a) Exchange Agent. Prior
to
the Effective Time, Parent shall appoint
EquiServe Trust Company or another bank
or trust company that is reasonably
satisfactory to the Company to act as
exchange agent (the "Exchange Agent") for
the payment of the Merger
Consideration. At the Effective Time,
Parent shall deposit, or cause the
Surviving Corporation to deposit, with the
Exchange Agent, for the benefit of
the holders of Certificates, certificates
representing shares of Parent Common
Stock and cash in an amount sufficient to
pay the aggregate Merger Consideration
required to be paid pursuant to Section
2.01(c). In addition, Parent shall
deposit with the Exchange Agent, as
necessary from time to time after the
Effective Time, any dividends or other
distributions payable pursuant to Section
2.02(c) and cash in lieu of any fractional
shares payable pursuant to Section
2.02(e). All shares of Parent Common Stock,
cash, dividends and distributions
deposited with the Exchange Agent pursuant
to this Section 2.02(a) shall
hereinafter be referred to as the "Exchange
Fund".
(b) Exchange Procedures. As soon as reasonably practicable after
the
Effective Time, Parent shall cause the
Exchange Agent to mail to each holder of
record of a Certificate whose shares of
Company Common Stock were converted into
the right to receive the Merger
Consideration, any dividends or other
distributions payable pursuant to Section
2.02(c) and cash in lieu of any
fractional shares payable pursuant to
Section 2.02(e) (i) a form of letter of
transmittal (which shall specify that
delivery shall be effected, and risk of
loss and title to the Certificates shall
pass, only upon proper delivery of the
Certificates to the Exchange Agent and
which shall be in customary form and
contain customary provisions) and (ii)
instructions for use in effecting the
surrender of the Certificates in exchange
for the Merger Consideration, any
dividends or other distributions payable
pursuant to Section 2.02(c) and cash in
lieu of any fractional shares payable
pursuant to Section 2.02(e). Each holder
of record of one or more Certificates
shall, upon surrender to the Exchange
Agent of such Certificate or Certificates,
together with such letter of
transmittal, duly executed, and such other
documents as may reasonably be
required by the Exchange Agent, be entitled
to receive in exchange therefor (i)
the amount of cash to which such holder is
entitled pursuant to Section 2.01(c),
(ii) a certificate or certificates
representing that number of whole shares of
Parent Common Stock (after taking into
account all Certificates surrendered by
such holder) to which such holder is
entitled pursuant to Section 2.01(c) (which
shall be in uncertificated book entry form
unless a physical certificate is
requested), (iii) any dividends or
distributions payable pursuant to Section
2.02(c) and (iv) cash in lieu of any
fractional shares payable pursuant to
Section 2.02(e), and the Certificates so
surrendered shall forthwith be
canceled. In the event of a transfer of
ownership of Company Common Stock which
is not registered in the transfer records
of the Company, payment of the Merger
Consideration in accordance with this
Section 2.02(b) may be made to a person
other than the person in whose name the
Certificate so surrendered is registered
if such Certificate shall be properly
endorsed or otherwise be in proper form
for transfer and the person requesting such
payment shall pay any transfer or
other taxes required by reason of the
payment of the Merger Consideration, any
dividends or other distributions payable
pursuant to Section 2.02(c) and cash in
lieu of any fractional shares payable
pursuant to Section 2.02(e) to a person
other than the registered holder of such
Certificate or establish to the
reasonable satisfaction of Parent that such
taxes have been paid or are not
applicable. Until surrendered as
contemplated by this Section 2.02(b), each
Certificate shall be deemed at any time
after the Effective Time to represent
only the right to receive upon such
surrender the Merger Consideration, any
dividends or other distributions payable
pursuant to Section 2.02(c) and cash in
lieu of any fractional shares payable
pursuant to Section 2.02(e). No interest
shall be paid or will accrue on any payment
to holders of Certificates pursuant
to the provisions of this Article II.
(c) Distributions with Respect to Unexchanged Shares. No dividends
or
other distributions with respect to Parent
Common Stock with a record date after
the Effective Time shall be paid to the
holder of any unsurrendered Certificate
with respect to the shares of Parent Common
Stock that the holder thereof has
the right to receive upon the surrender
thereof, and no cash payment in lieu of
fractional shares of Parent Common Stock
shall be paid to any such holder
pursuant to Section 2.02(e), in each case
until the holder of such Certificate
shall have surrendered such Certificate in
accordance with this Article II.
Following the surrender of any Certificate,
there shall be paid to the record
holder of the certificate representing
whole shares of Parent Common Stock
issued in exchange therefor, without
interest, (i) at the time of such
surrender, the amount of dividends or other
distributions with a record date
after the Effective Time theretofore paid
with respect to such whole shares of
Parent Common Stock and the amount of any
cash payable in lieu of a fractional
share of Parent Common Stock to which such
holder is entitled pursuant to
Section 2.02(e) and (ii) at the appropriate
payment date, the amount of
dividends or other distributions with a
record date after the Effective Time but
prior to such surrender and a payment date
subsequent to such surrender payable
with respect to such whole shares of Parent
Common Stock.
(d) No Further Ownership Rights in Company Common Stock. The
Merger
Consideration, any dividends or other
distributions payable pursuant to Section
2.02(c) and cash in lieu of any fractional
shares payable pursuant to Section
2.02(e) paid upon the surrender of
Certificates in accordance with the terms of
this Article II shall be deemed to have
been paid in full satisfaction of all
rights pertaining to the shares of Company
Common Stock formerly represented by
such Certificates. At the close of business
on the day on which the Effective
Time occurs, the share transfer books of
the Company shall be closed, and there
shall be no further registration of
transfers on the share transfer books of the
Surviving Corporation of the shares of
Company Common Stock that were
outstanding immediately prior to the
Effective Time. If, after the Effective
Time, any Certificate is presented to the
Surviving Corporation for transfer, it
shall be canceled against delivery of the
Merger Consideration, any dividends or
other distributions payable pursuant to
Section 2.02(c) and cash in lieu of any
fractional shares payable pursuant to
Section 2.02(e) to the holder thereof as
provided in this Article II.
(e) No Fractional Shares. (i) No certificates or scrip
representing
fractional shares of Parent Common Stock
shall be issued upon the surrender for
exchange of Certificates, no dividends or
other distributions of Parent shall
relate to such fractional share interests
and such fractional share interests
will not entitle the owner thereof to vote
or to any rights of a shareholder of
Parent.
(ii) In lieu of such fractional share interests, Parent shall pay
to
each holder of a Certificate an amount in
cash equal to the product obtained by
multiplying (A) the fractional share
interest to which such holder (after taking
into account all shares of Company Common
Stock formerly represented by all
Certificates surrendered by such holder)
would otherwise be entitled by (B) the
per share closing price of Parent Common
Stock on the Closing Date (the "Closing
Price"), as such price is reported on the
New York Stock Exchange, Inc. (the
"NYSE") Composite Transaction Tape (as
reported by Bloomberg Financial Markets
or such other source as the parties shall
agree in writing).
(f) Termination of the Exchange Fund. Any portion of the Exchange
Fund
which remains undistributed to the holders
of the Certificates for six months
after the Effective Time shall be delivered
to Parent, upon demand, and any
holders of the Certificates who have not
theretofore complied with this Article
II shall thereafter look only to Parent
for, and Parent shall remain liable for,
payment of their claim for the Merger
Consideration, any dividends or other
distributions payable pursuant to Section
2.02(c) and cash in lieu of any
fractional shares payable pursuant to
Section 2.02(e) in accordance with this
Article II.
(g) No Liability. None of Parent, Sub, the Company, the
Surviving
Corporation or the Exchange Agent shall be
liable to any person in respect of
any shares of Parent Common Stock, cash,
dividends or other distributions from
the Exchange Fund properly delivered to a
public official pursuant to any
applicable abandoned property, escheat or
similar Law. If any Certificate shall
not have been surrendered prior to four
years after the Effective Time (or
immediately prior to such earlier date on
which any Merger Consideration (and
any dividends or other distributions
payable with respect thereto pursuant to
Section 2.02(c) and cash in lieu of any
fractional shares payable with respect
thereto pursuant to Section 2.02(e)) would
otherwise escheat to or become the
property of any Governmental Entity), any
such Merger Consideration (and any
dividends or other distributions payable
with respect thereto pursuant to
Section 2.02(c) and cash in lieu of any
fractional shares payable with respect
thereto pursuant to Section 2.02(e)) shall,
to the extent permitted by
applicable Law, become the property of
Parent, free and clear of all claims or
interest of any person previously entitled
thereto.
(h) Investment of Exchange Fund. The Exchange Agent shall invest
the
cash included in the Exchange Fund as
directed by Parent. Any interest and other
income resulting from such investments
shall be paid to and be income of Parent.
If for any reason (including losses) the
cash in the Exchange Fund shall be
insufficient to fully satisfy all of the
payment obligations to be made in cash
by the Exchange Agent hereunder, Parent
shall promptly deposit cash into the
Exchange Fund in an amount which is equal
to the deficiency in the amount of
cash required to fully satisfy such cash
payment obligations.
(i) Lost Certificates. If any Certificate shall have been lost,
stolen
or destroyed, upon the making of an
affidavit of that fact by the person
claiming such Certificate to be lost,
stolen or destroyed and, if required by
Parent, the posting by such person of a
bond in such reasonable amount as Parent
may direct as indemnity against any claim
that may be made against it with
respect to such Certificate, the Exchange
Agent shall deliver in exchange for
such lost, stolen or destroyed Certificate
the Merger Consideration, any
dividends or other distributions payable
pursuant to Section 2.02(c) and cash in
lieu of any fractional shares payable
pursuant to Section 2.02(e), in each case
pursuant to this Article II.
(j) Withholding Rights. Parent, the Surviving Corporation or
the
Exchange Agent shall be entitled to deduct
and withhold from the consideration
otherwise payable pursuant to this
Agreement to any holder of Certificates such
amounts as Parent, the Surviving
Corporation or the Exchange Agent is required
to deduct and withhold with respect to the
making of such payment under the
Internal Revenue Code of 1986, as amended
(the "Code"), or any provision of
state, local or foreign tax Law. To the
extent that amounts are so withheld and
paid over to the appropriate taxing
authority by Parent, the Surviving
Corporation or the Exchange Agent, such
withheld amounts shall be treated for
all purposes of this Agreement as having
been paid to the holder of Certificates
in respect of which such deduction and
withholding was made by Parent, the
Surviving Corporation or the Exchange
Agent.
ARTICLE III
Representations and Warranties
SECTION 3.01. Representations and Warranties of the Company. Except
as
disclosed in the Company SEC Documents
filed by the Company and publicly
available prior to November 14, 2005
("Filed Company SEC Documents"), and except
as set forth in (i) the disclosure schedule
delivered by the Company to Parent
prior to the execution of the Original
Merger Agreement and (ii) the supplement
thereto delivered by the Company to Parent
prior to the execution of this
Agreement (collectively, the "Company
Disclosure Schedule") (with specific
reference to the particular Section or
subsection of this Agreement to which the
information set forth in such disclosure
schedule relates; provided, however,
that any information set forth in one
section of the Company Disclosure Schedule
shall be deemed to apply to each other
Section or subsection thereof to which
its relevance is readily apparent on its
face), the Company represents and
warrants to Parent and Sub as follows:
(a) Organization, Standing and Corporate Power. Each of the Company
and
its Subsidiaries has been duly organized,
and is validly existing and in good
standing (with respect to jurisdictions
that recognize that concept) under the
Laws of the jurisdiction of its
incorporation or formation, as the case may be,
and has all requisite power and authority
and possesses all governmental
licenses, permits, authorizations and
approvals necessary to enable it to use
its corporate or other name and to own,
lease or otherwise hold and operate its
properties and other assets and to carry on
its business as currently conducted,
except where the failure to have such
governmental licenses, permits,
authorizations or approvals individually or
in the aggregate has not had and
would not reasonably be expected to have a
Material Adverse Effect. Each of the
Company and its Subsidiaries is duly
qualified or licensed to do business and is
in good standing (with respect to
jurisdictions that recognize that concept) in
each jurisdiction in which the nature of
its business or the ownership, leasing
or operation of its properties makes such
qualification, licensing or good
standing necessary, other than in such
jurisdictions where the failure to be so
qualified, licensed or in good standing
individually or in the aggregate has not
had and would not reasonably be expected to
have a Material Adverse Effect. The
Company has made available to Parent, prior
to the date of this Agreement,
complete and accurate copies of the Company
Articles and the Company's By-laws
(the "Company By-laws"), and the comparable
organizational documents of each
Significant Subsidiary (as such term is
defined in Rule 12b-2 under the Exchange
Act), in each case as amended to the date
hereof.
(b) Subsidiaries. Section 3.01(b) of the Company Disclosure
Schedule
lists, as of the date hereof, (i) each
Significant Subsidiary of the Company
(including its state of incorporation or
formation) and (ii) each other
Subsidiary of the Company. All of the
outstanding capital stock of, or other
equity interests in, each Significant
Subsidiary of the Company, is directly or
indirectly owned by the Company. All the
issued and outstanding shares of
capital stock of, or other equity interests
in, each such Subsidiary owned by
the Company have been validly issued and
are fully paid and nonassessable and
are owned directly or indirectly by the
Company free and clear of all pledges,
liens, charges, encumbrances or security
interests of any kind or nature
whatsoever (other than liens, charges and
encumbrances for current taxes not yet
due and payable) (collectively, "Liens"),
and free of any restriction on the
right to vote, sell or otherwise dispose of
such capital stock or other equity
interests. Except with respect to
securities of non-Affiliates that, to the
Knowledge of the Company, do not constitute
a 20% or greater interest in such
non-Affiliates (or a 5% or greater interest
in such non-Affiliates if the
Company's investment therein is greater
than $20,000,000), and except for the
capital stock of, or voting securities or
equity interests in, its Subsidiaries,
the Company does not own, directly or
indirectly, as of the date hereof, any
capital stock of, or other voting
securities or equity interests in, any
corporation, partnership, joint venture,
association or other entity.
(c) Capital Structure. The authorized capital stock of the
Company
consists of 1,000,000,000 shares of Company
Common Stock and 50,000,000 shares
of preferred stock, without par value
("Company Preferred Stock"). 1,500,000
shares of Company Preferred Stock have been
designated as Series A Participating
Preferred Stock, without par value (the
"Company Series A Preferred Stock"). At
the close of business on October 31, 2005,
(i) 332,448,023 shares of Company
Common Stock were issued and outstanding
(which number includes (A) 708,755
shares of Company Common Stock held by the
Company in its treasury, (B)
1,382,196 shares of Company Common Stock
held by the trust established under The
Guidant Employee Savings and Stock
Ownership Plan and (C) 1,084,669 shares of
Company Common Stock subject to vesting and
restrictions on transfer ("Company
Restricted Stock")), (ii) 28,029,833 shares
of Company Common Stock were
reserved and available for issuance
pursuant to the Company's 1994 Stock Plan,
as amended, 1996 Nonemployee Director Stock
Plan, as amended, 1998 Stock Plan,
as amended, and 2001 Employee Stock
Purchase Plan (the "ESPP") (such plans,
collectively, the "Company Stock Plans"),
of which 26,067,053 shares of Company
Common Stock were subject to outstanding
Company Stock Options or agreements to
issue Company Stock Options, and (iii) no
shares of Company Preferred Stock
(including Company Series A Preferred
Stock) were issued or outstanding or were
held by the Company as treasury shares.
Except as set forth above in this
Section 3.01(c), at the close of business
on October 31, 2005, no shares of
capital stock or other voting securities or
equity interests of the Company were
issued, reserved for issuance or
outstanding. At the close of business on
October 31, 2005, there were no outstanding
stock appreciation rights, "phantom"
stock rights, restricted stock units,
performance units, rights to receive
shares of Company Common Stock on a
deferred basis or other rights (other than
Company Stock Options) that are linked to
the value of Company Common Stock
(collectively, "Company Stock-Based
Awards"). All outstanding options to
purchase shares of Company Common Stock
exclusive of rights under the ESPP
(collectively, "Company Stock Options") and
shares of Company Restricted Stock
are evidenced by stock option agreements,
restricted stock purchase agreements
or other award agreements. All outstanding
shares of capital stock of the
Company are, and all shares which may be
issued pursuant to the Company Stock
Options or Company Stock-Based Awards will
be, when issued in accordance with
the terms thereof, duly authorized, validly
issued, fully paid and nonassessable
and not subject to preemptive rights. There
are no bonds, debentures, notes or
other indebtedness of the Company having
the right to vote (or convertible into,
or exchangeable for, securities having the
right to vote) on any matters on
which shareholders of the Company may vote.
Except as set forth above in this
Section 3.01(c) and for issuances of shares
of Company Common Stock pursuant to
the Company Stock Options set forth above
in this Section 3.01(c) and subject to
Section 4.01(a), (x) there are not issued,
reserved for issuance or outstanding
(A) any shares of capital stock or other
voting securities or equity interests
of the Company, (B) any securities of the
Company convertible into or
exchangeable or exercisable for shares of
capital stock or other voting
securities or equity interests of the
Company, (C) any warrants, calls, options
or other rights to acquire from the Company
or any of its Subsidiaries, and no
obligation of the Company or any of its
Subsidiaries to issue, any capital
stock, voting securities, equity interests
or securities convertible into or
exchangeable or exercisable for capital
stock or voting securities of the
Company or (D) any Company Stock-Based
Awards and (y) there are not any
outstanding obligations of the Company or
any of its Subsidiaries to repurchase,
redeem or otherwise acquire any such
securities or to issue, deliver or sell, or
cause to be issued, delivered or sold, any
such securities. Neither the Company
nor any of its Subsidiaries is a party to
any voting Contract with respect to
the voting of any such securities. Except
as set forth above in this Section
3.01(c) and subject to Section 4.01(a),
there are no outstanding (1) securities
of the Company or any of its Subsidiaries
convertible into or exchangeable or
exercisable for shares of capital stock or
voting securities or equity interests
of any Subsidiary of the Company, (2)
warrants, calls, options or other rights
to acquire from the Company or any of its
Subsidiaries, and no obligation of the
Company or any of its Subsidiaries to
issue, any capital stock, voting
securities, equity interests or securities
convertible into or exchangeable or
exercisable for capital stock or voting
securities of any Subsidiary of the
Company or (3) obligations of the Company
or any of its Subsidiaries to
repurchase, redeem or otherwise acquire any
such outstanding securities or to
issue, deliver or sell, or cause to be
issued, delivered or sold, any such
securities.
(d) Authority; Noncontravention. The Company has all requisite
corporate power and authority to execute
and deliver this Agreement and, subject
to receipt of the Shareholder Approval, to
consummate the transactions
contemplated by this Agreement. The
execution and delivery of this Agreement by
the Company and the consummation by the
Company of the transactions contemplated
by this Agreement have been duly authorized
by all necessary corporate action on
the part of the Company and no other
corporate proceedings on the part of the
Company are necessary to authorize this
Agreement or to consummate the
transactions contemplated by this
Agreement, subject, in the case of the
consummation of the Merger, to the
obtaining of the Shareholder Approval. This
Agreement has been duly executed and
delivered by the Company and, assuming the
due authorization, execution and delivery
by each of the other parties hereto,
constitutes a legal, valid and binding
obligation of the Company, enforceable
against the Company in accordance with its
terms, subject to bankruptcy,
insolvency, fraudulent transfer,
moratorium, reorganization or similar Laws
affecting the rights of creditors generally
and the availability of equitable
remedies (regardless of whether such
enforceability is considered in a
proceeding in equity or at law). The Board
of Directors of the Company, at a
meeting duly called and held, duly and
unanimously adopted by all directors
present, resolutions (i) adopting this
Agreement, the Merger and the other
transactions contemplated by this
Agreement, (ii) declaring that it is in the
best interests of the Company and the
shareholders of the Company that the
Company enter into this Agreement and
consummate the Merger and the other
transactions contemplated by this Agreement
on the terms and subject to the
conditions set forth in this Agreement,
(iii) directing that the Company use its
reasonable best efforts to submit the
approval of this Agreement to a vote at a
meeting of the shareholders of the Company
as promptly as practicable, and (iv)
recommending that the shareholders of the
Company approve this Agreement, which
resolutions, as of November 14, 2005, have
not been subsequently rescinded,
modified or withdrawn in any way. The
execution and delivery of this Agreement
by the Company do not, and the consummation
by the Company of the Merger and the
other transactions contemplated by this
Agreement and compliance by the Company
with the provisions of this Agreement will
not, conflict with, or result in any
violation or breach of, or default (with or
without notice or lapse of time, or
both) under, or give rise to a right of, or
result in, termination, cancelation
or acceleration of any obligation or to the
loss of a benefit under, or result
in the creation of any Lien in or upon any
of the properties or other assets of
the Company or any of its Subsidiaries
under, (x) the Company Articles or the
Company By-laws or the comparable
organizational documents of any of its
Subsidiaries, (y) any loan or credit
agreement, bond, debenture, note, mortgage,
indenture, lease, supply agreement, license
agreement, development agreement or
other contract, agreement, obligation,
commitment or instrument that is intended
by the Company, Parent or any of their
respective Subsidiaries, as applicable,
to be legally binding, (each, including all
amendments thereto, a "Contract"),
to which the Company or any of its
Subsidiaries is a party or any of their
respective properties or other assets is
subject or (z) subject to the obtaining
of the Shareholder Approval and the
governmental filings and other matters
referred to in the following sentence, any
(A) statute, law, ordinance, rule or
regulation (each, a "Law") applicable to
the Company or any of its Subsidiaries
or their respective properties or other
assets or (B) order, writ, injunction,
decree, judgment or stipulation (each, an
"Order") applicable to the Company or
any of its Subsidiaries or their respective
properties or other assets, other
than, in the case of clauses (y) and (z),
any such conflicts, violations,
breaches, defaults, rights of termination,
cancelation or acceleration, losses
or Liens that individually or in the
aggregate have not had and would not
reasonably be expected to (x) have a
Material Adverse Effect, (y) impair in any
material respect the ability of the Company
to perform its obligations under
this Agreement or (z) prevent or materially
impede, interfere with, hinder or
delay the consummation of the transactions
contemplated by this Agreement. No
consent, approval, order or authorization
of, action by or in respect of, or
registration, declaration or filing with,
any Federal, state, local or foreign
government, any court, administrative,
regulatory or other governmental agency,
commission or authority or any organized
securities exchange (each, a
"Governmental Entity") is required by or
with respect to the Company or any of
its Subsidiaries in connection with the
execution and delivery of this Agreement
by the Company or the consummation of the
Merger or the other transactions
contemplated by this Agreement, except for
(1) (A) the filing of a premerger
notification and report form by the Company
under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as
amended, and the rules and regulations
thereunder (the "HSR Act") and the
termination of the waiting period required
thereunder, (B) all required notifications
and filings by the Company under
Article 4 of Council Regulation 139/2004 of
the European Community, as amended
(the "EC Merger Regulation"), and the
receipt of a decision under Article
6(1)(b), 8(1) or 8(2) thereunder declaring
the Merger compatible with the EC
Common Market and (C) the receipt,
termination or expiration, as applicable, of
approvals or waiting periods required under
any other applicable competition,
merger control, antitrust or similar Law,
(2) the filing with the Securities and
Exchange Commission (the "SEC") of (X) a
proxy statement relating to the
adoption by the shareholders of the Company
of this Agreement (as amended or
supplemented from time to time, the "Proxy
Statement") and (Y) such reports
under the Securities Exchange Act of 1934,
as amended (including the rules and
regulations promulgated thereunder, the
"Exchange Act"), as may be required in
connection with this Agreement and the
transactions contemplated by this
Agreement, (3) the filing of the Articles
of Merger with the Secretary of State
of the State of Indiana and appropriate
documents with the relevant authorities
of other states in which the Company or any
of its Subsidiaries is qualified to
do business, (4) any filings with and
approvals of the NYSE and (5) such other
consents, approvals, orders,
authorizations, actions, registrations,
declarations and filings the failure of
which to be obtained or made
individually or in the aggregate has not
had and would not reasonably be
expected to (x) have a Material Adverse
Effect, (y) impair in any material
respect the ability of the Company to
perform its obligations under this
Agreement or (z) prevent or materially
impede, interfere with, hinder or delay
the consummation of the transactions
contemplated by this Agreement.
(e) Company SEC Documents. (i) The Company has filed all
reports,
schedules, forms, statements and other
documents (including exhibits and other
information incorporated therein) with the
SEC required to be filed by the
Company since January 1, 2003 (such
documents, together with any documents filed
during such period by the Company with the
SEC on a voluntary basis on Current
Reports on Form 8-K, the "Company SEC
Documents"). As of their respective filing
dates, the Company SEC Documents complied
in all material respects with, to the
extent in effect at the time of filing, the
requirements of the Securities Act
of 1933, as amended (including the rules
and regulations promulgated thereunder,
the "Securities Act"), the Exchange Act and
the Sarbanes-Oxley Act of 2002
(including the rules and regulations
promulgated thereunder, "SOX") applicable
to such Company SEC Documents, and none of
the Company SEC Documents contained
any untrue statement of a material fact or
omitted to state a material fact
required to be stated therein or necessary
in order to make the statements
therein, in light of the circumstances
under which they were made, not
misleading. Except to the extent that
information contained in any Company SEC
Document has been revised, amended,
supplemented or superseded by a later-filed
Company SEC Document, none of the Company
SEC Documents contains any untrue
statement of a material fact or omits to
state any material fact required to be
stated therein or necessary in order to
make the statements therein, in light of
the circumstances under which they were
made, not misleading, which individually
or in the aggregate would require an
amendment, supplement or corrective filing
to such Company SEC Documents. Each of the
financial statements (including the
related notes) of the Company included in
the Company SEC Documents complied at
the time it was filed as to form in all
material respects with the applicable
accounting requirements and the published
rules and regulations of the SEC with
respect thereto in effect at the time of
filing, had been prepared in accordance
with generally accepted accounting
principles in the United States ("GAAP")
(except, in the case of unaudited
statements, as permitted by the rules and
regulations of the SEC) applied on a
consistent basis during the periods
involved (except as may be indicated in the
notes thereto) and fairly presented
in all material respects the consolidated
financial position of the Company and
its consolidated Subsidiaries as of the
dates thereof and the consolidated
results of their operations and cash flows
for the periods then ended (subject,
in the case of unaudited statements, to
normal year-end audit adjustments).
Neither the Company nor any of its
Subsidiaries has any liabilities or
obligations of any nature (whether accrued,
absolute, contingent or otherwise)
which individually or in the aggregate have
had or would reasonably be expected
to have a Material Adverse Effect. None of
the Subsidiaries of the Company are,
or have at any time since January 1, 2003
been, subject to the reporting
requirements of Section 13(a) or 15(d) of
the Exchange Act.
(ii) Each of the principal executive officer of the Company and
the
principal financial officer of the Company
(or each former principal executive
officer of the Company and each former
principal financial officer of the
Company, as applicable) has made all
certifications required by Rule 13a-14 or
15d-14 under the Exchange Act and Sections
302 and 906 of SOX with respect to
the Company SEC Documents, and the
statements contained in such certifications
are true and accurate. For purposes of this
Agreement, "principal executive
officer" and "principal financial officer"
shall have the meanings given to such
terms in SOX. Neither the Company nor any
of its Subsidiaries has outstanding,
or has arranged any outstanding,
"extensions of credit" to directors or
executive officers within the meaning of
Section 402 of SOX.
(iii) The Company maintains a system of internal accounting
controls
sufficient to provide reasonable assurance
that (A) transactions are executed in
accordance with management's general or
specific authorizations; (B) access to
assets is permitted only in accordance with
management's general or specific
authorization; and (C) the recorded
accountability for assets is compared with
the existing assets at reasonable intervals
and appropriate action is taken with
respect to any differences.
(iv) The Company's "disclosure controls and procedures" (as defined
in
Rules 13a-15(e) and 15d-15(e) of the
Exchange Act) are reasonably designed to
ensure that all information (both financial
and non-financial) required to be
disclosed by the Company in the reports
that it files or submits under the
Exchange Act is recorded, processed,
summarized and reported within the time
periods specified in the rules and forms of
the SEC, and that all such
information is accumulated and communicated
to the Company's management as
appropriate to allow timely decisions
regarding required disclosure and to make
the certifications of the chief executive
officer and chief financial officer of
the Company required under the Exchange Act
with respect to such reports.
(f) Information Supplied. None of the information supplied or to
be
supplied by or on behalf of the Company
specifically for inclusion or
incorporation by reference in (i) the Form
S-4 to be filed with the SEC by
Parent in connection with the issuance of
shares of Parent Common Stock in the
Merger will, at the time the Form S-4 is
filed with the SEC and at the time it
becomes effective under the Securities Act,
contain any untrue statement of a
material fact or omit to state any material
fact required to be stated therein
or necessary to make the statements
therein, in light of the circumstances under
which they are made, not misleading or (ii)
the Proxy Statement will, at the
date it is first mailed to the shareholders
of the Company and at the time of
the Shareholders' Meeting, contain any
untrue statement of a material fact or
omit to state any material fact required to
be stated therein or necessary in
order to make the statements therein, in
light of the circumstances under which
they are made, not misleading, except that
no representation or warranty is made
by the Company with respect to statements
made or incorporated by reference
therein based on information supplied by or
on behalf of Parent or Sub
specifically for inclusion or incorporation
by reference in the Form S-4 or the
Proxy Statement. The Proxy Statement will
comply as to form in all material
respects with the requirements of the
Exchange Act.
(g) Absence of Certain Changes or Events. Except for
liabilities
incurred in connection with this Agreement
or as expressly permitted pursuant to
Section 4.01(a)(i) through (xvi), since the
date of the most recent financial
statements included in the Filed Company
SEC Documents, the Company and its
Subsidiaries have conducted their
respective businesses only in the ordinary
course consistent with past practice, and
there has not been any Material
Adverse Change, and from such date until
the date hereof there has not been (i)
any declaration, setting aside or payment
of any dividend or other distribution
(whether in cash, stock or property) with
respect to any capital stock of the
Company or any of its Subsidiaries, other
than (x) cash dividends payable by the
Company in respect of shares of Company
Common Stock consistent with past
practice and not exceeding $0.10 per share
of Company Common Stock per fiscal
quarter or (y) dividends or distributions
by a direct or indirect wholly owned
Subsidiary of the Company to its
shareholders, (ii) any purchase, redemption or
other acquisition by the Company or any of
its Subsidiaries of any shares of
capital stock or any other securities of
the Company or any of its Subsidiaries
or any options, warrants, calls or rights
to acquire such shares or other
securities, other than in connection with
net share withholding in connection
with the vesting of Company Restricted
Stock, (iii) any split, combination or
reclassification of any capital stock of
the Company or any of its Subsidiaries
or any issuance or the authorization of any
issuance of any other securities in
respect of, in lieu of or in substitution
for shares of their respective capital
stock, (iv) (A) any granting by the Company
or any of its Subsidiaries to any
current or former (1) director of the
Company or any of its Subsidiaries or (2)
employee of the Company or any of its
Subsidiaries who is treated as a Tier I
Employee (a "Tier I Employee") or Tier II
Employee (a "Tier II Employee") for
purposes of the Company's Change in Control
Severance Pay Plan for Select
Employees (all individuals described in the
foregoing clauses (1) and (2) of
this clause (A), collectively, the "Key
Personnel") of any increase in
compensation, bonus or fringe or other
benefits, except for normal increases in
cash compensation (including cash bonuses)
in the ordinary course of business
consistent with past practice or as was
required under any Company Benefit
Agreement or Company Benefit Plan, (B) any
granting by the Company or any of its
Subsidiaries to any Key Personnel of (1)
any increase in severance or
termination pay or (2) any right to receive
any severance or termination pay
except for severance or termination pay
received in the ordinary course of
business consistent with past practice or
as was required under any Company
Benefit Agreement or Company Benefit Plan,
(C) any entry by the Company or any
of its Subsidiaries into, or any amendments
of, (1) any employment, deferred
compensation, consulting, severance, change
of control, termination or
indemnification Contract with any Key
Personnel or (2) any Contract with any Key
Personnel the benefits of which are
contingent, or the terms of which are
materially altered, upon the occurrence of
a transaction involving the Company
of a nature contemplated by this Agreement
(all such Contracts under this clause
(C), collectively, "Company Benefit
Agreements"), (D) the removal or
modification of any restrictions in any
Company Benefit Agreement or Company
Benefit Plan or awards made thereunder,
except as required to comply with
applicable Law or any Company Benefit
Agreement or Company Benefit Plan in
effect as of the date hereof or (E) the
adoption, amendment or termination of
any Company Benefit Plan, other than, in
the cases of clauses (A), (B), (C) and
(D), such increases, amendments, new
agreements, removals, modifications or
terminations with respect to Tier II
Employees that (1) do not provide for any
increase in compensation or benefits for
any individual Tier II Employee that is
material in relation to such Tier II
Employee's compensation or benefits prior
to such increase and (2) in the aggregate
do not result in any material increase
in compensation, benefits or other similar
expenses of the Company and its
Subsidiaries, (v) any damage, destruction
or loss, whether or not covered by
insurance, that individually or in the
aggregate has had or would reasonably be
expected to have a Material Adverse Effect,
(vi) any change in accounting
methods, principles or practices by the
Company materially affecting its assets,
liabilities or businesses, except insofar
as may have been required by a change
in GAAP or (vii) any material tax election
or any settlement or compromise of
any material income tax liability.
(h) Litigation. Except with respect to taxes, which are the subject
of
Section 3.01(n), there is no suit, action
or proceeding pending or, to the
Knowledge of the Company, threatened
against or affecting the Company or any of
its Subsidiaries or any of their respective
assets that individually or in the
aggregate has had or would reasonably be
expected to have a Material Adverse
Effect, nor is there any demand, letter or
Order of any Governmental Entity or
arbitrator outstanding against, or, to the
Knowledge of the Company,
investigation by any Governmental Entity
involving, the Company or any of its
Subsidiaries or any of their respective
assets that individually or in the
aggregate has had or would reasonably be
expected to have a Material Adverse
Effect.
(i) Contracts. (1) As of the date hereof, neither the Company nor
any
of its Subsidiaries is a party to, and none
of their respective properties or
other assets is subject to, any Contract
that is a "material contract" (as such
term is defined in Item 601(b)(10) of
Regulation S-K of the SEC) (a "Material
Contract"). None of the Company, any of its
Subsidiaries or, to the Knowledge of
the Company, any other party thereto is in
violation of or in default under (nor
does there exist any condition which upon
the passage of time or the giving of
notice or both would cause such a violation
of or default by the Company or any
of its Subsidiaries or, to the Knowledge of
the Company, any other party thereto
under) any Contract to which it is a party
or by which it or any of its
properties or other assets is bound, except
for violations or defaults that
individually or in the aggregate have not
had and would not reasonably be
expected to have a Material Adverse Effect.
Neither the Company nor any of its
Subsidiaries has entered into any Contract
that is currently in effect that is
required to be disclosed pursuant to Item
404 of Regulation S-K of the SEC.
(2) Section 3.01(i)(2) of the Company Disclosure Schedule
contains a complete and accurate list, as
of the date hereof, of (A) each
material Contract restricting or purporting
to restrict any of the Company's
Affiliates' ability to compete (other than
each such Contract that only
restricts the Company's Subsidiaries'
ability to compete) in any line of
business, geographic area or customer
segment, (B) each material Contract
restricting the Company's or any of its
Subsidiaries' ability to compete in any
line of business, geographic area or
customer segment and (C) each material
Contract relating to distribution, sale,
supply, licensing, co-promotion or
manufacturing of any products or services
of the Company or any of its
Subsidiaries or any products licensed by
the Company or any of its Subsidiaries.
(j) Compliance with Laws; Environmental Matters. (i) Except
with
respect to Environmental Laws, the Employee
Retirement Income Security Act of
1974, as amended ("ERISA"), taxes and
regulatory compliance, which are the
subjects of Sections 3.01(j)(ii), 3.01(l),
3.01(n) and 3.01(u), respectively,
each of the Company and its Subsidiaries is
in compliance with all Laws and
Orders (collectively, "Legal Provisions")
applicable to it, its properties or
other assets or its business or operations,
except for failures to be in
compliance that individually or in the
aggregate have not had and would not
reasonably be expected to have a Material
Adverse Effect. Each of the Company
and its Subsidiaries has in effect all
approvals, authorizations, certificates,
filings, franchises, licenses, notices and
permits of or with all Governmental
Entities (collectively, "Permits"),
including all Permits under the Federal
Food, Drug and Cosmetic Act of 1938, as
amended (including the rules and
regulations promulgated thereunder, the
"FDCA"), necessary for it to own, lease
or operate its properties and other assets
and to carry on its business and
operations as currently conducted, except
where the failure to have such Permits
individually or in the aggregate has not
had and would not reasonably be
expected to have a Material Adverse Effect.
Since January 1, 2000, there has
occurred no default under, or violation of,
any such Permit, except for any such
default or violation that individually or
in the aggregate has not had and would
not reasonably be expected to have a
Material Adverse Effect. The consummation
of the Merger, in and of itself, would not
cause the revocation or cancelation
of any such Permit that individually or in
the aggregate would reasonably be
expected to have a Material Adverse
Effect.
(ii) Except for those matters that individually or in the
aggregate
have not had and would not reasonably be
expected to have a Material Adverse
Effect: (A) during the period of ownership
or operation by the Company or any of
its Subsidiaries of any of its currently or
formerly owned, leased or operated
properties, there have been no Releases of
Hazardous Materials in, on, under or
affecting any properties which would
subject the Company or any of its
Subsidiaries to any liability under any
Environmental Law or require any
expenditure by the Company or any of its
Subsidiaries for remediation to meet
applicable standards thereunder; (B) prior
to and after, as applicable, the
period of ownership or operation by the
Company or any of its Subsidiaries of
any of its currently or formerly owned,
leased or operated properties, to the
Knowledge of the Company, there were no
Releases of Hazardous Materials in, on,
under or affecting any properties which
would subject the Company or any of its
Subsidiaries to any liability under any
Environmental Law or require any
expenditure by the Company or any of its
Subsidiaries for remediation to meet
applicable standards thereunder; (C)
neither the Company nor any of its
Subsidiaries is subject to any indemnity
obligation or other Contract with any
person relating to obligations or
liabilities under Environmental Laws; and (D)
to the Knowledge of the Company, there are
no facts, circumstances or conditions
that would reasonably be expected to form
the basis for any investigation, suit,
claim, action, proceeding or liability
against or affecting the Company or any
of its Subsidiaries relating to or arising
under Environmental Laws. The term
"Environmental Laws" means all applicable
Federal, state, local and foreign Laws
(including the common law), Orders,
notices, Permits or binding Contracts
issued, promulgated or entered into by any
Governmental Entity, relating in any
way to the environment, preservation or
reclamation of natural resources or the
presence, management, Release of, or
exposure to, Hazardous Materials, or to
human health and safety. The term
"Hazardous Materials" means (1) petroleum
products and by-products, asbestos and
asbestos-containing materials, urea
formaldehyde foam insulation, medical or
infectious wastes, polychlorinated
biphenyls, radon gas, radioactive
substances, chlorofluorocarbons and all other
ozone-depleting substances and (2) any
other chemical, material, substance,
waste, pollutant or contaminant that is
prohibited, limited or regulated by or
pursuant to any Environmental Law. The term
"Release" means any spilling,
leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping,
leaching, dumping, disposing or migrating
into or through the environment or any
natural or man-made structure.
(k) Labor Relations. From the date of the most recent financial
statements included in the Filed Company
SEC Documents through the date hereof,
there has not been any adoption, material
amendment or termination by the
Company or any of its Subsidiaries of any
collective bargaining or other labor
union Contract to which the Company or any
of its Subsidiaries is a party or by
which the Company or any of its
Subsidiaries is bound. There are no collective
bargaining or other labor union Contracts
to which the Company or any of its
Subsidiaries is a party or by which the
Company or any of its Subsidiaries is
bound. As of the date of this Agreement,
none of the employees of the Company or
any of its Subsidiaries are represented by
any union with respect to their
employment by the Company or such
Subsidiary. Since January 1, 2003, neither the
Company nor any of its Subsidiaries has
experienced any material labor disputes,
union organization attempts or work
stoppages, slowdowns or lockouts due to
labor disagreements.
(l) ERISA Compliance. (i) Section 3.01(l)(i) of the Company
Disclosure
Schedule contains a complete and accurate
list, as of the date hereof, of each
employment, bonus, pension, profit sharing,
deferred compensation, incentive
compensation, stock ownership, stock
purchase, stock appreciation, restricted
stock, stock option, "phantom" stock,
performance, retirement, thrift, savings,
stock bonus, paid time off, perquisite,
fringe benefit, vacation, severance,
disability, death benefit, hospitalization,
medical, welfare benefit or other
plan, program, policy or Contract
maintained, contributed to or required to be
maintained or contributed to by the Company
or any of its Subsidiaries or any
other person or entity that, together with
the Company, is treated as a single
employer under Section 414(b), (c), (m) or
(o) of the Code (each, a "Commonly
Controlled Entity") (exclusive of any such
plan, program, policy or Contract
mandated by and maintained solely pursuant
to applicable law), in each case
providing benefits to any current or former
director, officer or employee of the
Company or any of its Subsidiaries
(collectively, but exclusive of individual
option and restricted award agreements
issued under the Company Stock Plans, the
"Company Benefit Plans") and each Company
Benefit Agreement (exclusive of local
offer letters mandated under applicable
non-U.S. law that do not impose any
severance obligations other than any
mandatory statutory severance). Each
Company Benefit Plan that is an "employee
pension benefit plan" (as defined in
Section 3(2) of ERISA) is sometimes
referred to herein as a "Company Pension
Plan" and each Company Benefit Plan that is
an "employee welfare benefit plan"
(as defined in Section 3(1) of ERISA) is
sometimes referred to herein as a
"Company Welfare Plan".
(ii) The Company has provided to Parent complete and accurate
copies of
(A) each Company Benefit Plan or, at the
Company's option, in the case of
Company Benefit Plans maintained primarily
for the benefit of individuals
regularly employed outside the United
States, a summary thereof (or, in either
case, with respect to any unwritten Company
Benefit Plans, descriptions thereof)
and Company Benefit Agreements (exclusive
of local offer letters mandated under
applicable non-U.S. law that do not impose
any severance obligations other than
any mandatory statutory severance), (B) the
two most recent annual reports on
Form 5500 required to be filed with the
Internal Revenue Service (the "IRS")
with respect to each Company Benefit Plan
(if any such report was required), (C)
the most recent summary plan description
for each Company Benefit Plan for which
such summary plan description is required
and (D) each trust Contract and
insurance or group annuity Contract
relating to any Company Benefit Plan.
(iii) Each Company Benefit Plan has been administered in all
material
respects in accordance with its terms. The
Company, its Subsidiaries and all the
Company Benefit Plans are all in compliance
in all material respects with the
applicable provisions of ERISA, the Code
and all other applicable Laws,
including Laws of foreign jurisdictions,
and the terms of all collective
bargaining Contracts.
(iv) All Company Pension Plans intended to be tax-qualified
have
received favorable determination letters
from the IRS with respect to "TRA" (as
defined in Section 1 of IRS Rev. Proc.
93-39), and have timely filed with the
IRS determination letter applications (or
have received such a determination
letter) with respect to "GUST" (as defined
in Section 1 of IRS Notice 2001-42),
to the effect that such Company Pension
Plans are qualified and exempt from
Federal income taxes under Sections 401(a)
and 501(a), respectively, of the
Code, no such determination letter has been
revoked (nor, to the Knowledge of
the Company, has revocation been
threatened) and to the Knowledge of the
Company, no event has occurred since the
date of the most recent determination
letter or application therefor relating to
any such Company Pension Plan that
would reasonably be expected to adversely
affect the qualification of such
Company Pension Plan or materially increase
the costs relating thereto or
require security under Section 307 of
ERISA. The Company has provided to Parent
a complete and accurate copy of the most
recent determination letter received
prior to the date hereof with respect to
each Company Pension Plan, as well as a
complete and accurate copy of each pending
application for a determination
letter, if any. The Company has also
provided to Parent a complete and accurate
list of all amendments to any Company
Pension Plan as to which a favorable
determination letter has not yet been
received.
(v) Neither the Company nor any Commonly Controlled Entity has,
during
the six-year period ending on the date
hereof, maintained, contributed to or
been required to contribute to any Company
Pension Plan that is subject to Title
IV of ERISA or Section 412 of the Code, or
any "multiemployer plan" as defined
in Section 3(37) or 4001(a)(3) of ERISA.
Except as has not had and would not
reasonably be expected to have a Material
Adverse Effect, neither the Company
nor any Commonly Controlled Entity has any
unsatisfied liability under Title IV
of ERISA. To the Knowledge of the Company,
no condition exists that presents a
material risk to the Company or any
Commonly Controlled Entity of incurring a
material liability under Title IV of ERISA.
The Pension Benefit Guaranty
Corporation has not instituted proceedings
under Section 4042 of ERISA to
terminate any Company Benefit Plan and, to
the Knowledge of the Company, no
condition exists that presents a material
risk that such proceedings will be
instituted.
(vi) Except as has not had and would not reasonably be expected to
have
a Material Adverse Effect, (A) all reports,
returns and similar documents with
respect to all Company Benefit Plans
required to be filed with any Governmental
Entity or distributed to any Company
Benefit Plan participant have been duly and
timely filed or distributed, (B) none of
the Company or any of its Subsidiaries
has received notice of, and to the
Knowledge of the Company, there are no
investigations by any Governmental Entity
with respect to, termination
proceedings or other claims (except claims
for benefits payable in the normal
operation of the Company Benefit Plans),
suits or proceedings against or
involving any Company Benefit Plan or
asserting any rights or claims to benefits
under any Company Benefit Plan that could
reasonably be expected to give rise to
any material liability and (C) to the
Knowledge of the Company, there are not
any facts that could give rise to any
liability in the event of any such
investigation, claim, suit or
proceeding.
(vii) Except as has not had and would not reasonably be expected
to
have a Material Adverse Effect, (A) all
contributions, premiums and benefit
payments under or in connection with the
Company Benefit Plans that are required
to have been made as of the date hereof in
accordance with the terms of the
Company Benefit Plans have been timely made
or have been reflected on the most
recent consolidated balance sheet filed or
incorporated by reference into the
Filed Company SEC Documents and (B) no
Company Pension Plan has an "accumulated
funding deficiency" (as such term is
defined in Section 302 of ERISA or Section
412 of the Code), whether or not
waived.
(viii) With respect to each Company Benefit Plan, except as has not
had
and would not reasonably be expected to
have a Material Adverse Effect, (A)
there has not occurred any prohibited
transaction (within the meaning of Section
406 of ERISA or Section 4975 of the Code)
in which the Company or any of its
Subsidiaries or any of their respective
employees, or, to the Knowledge of the
Company, any trustee, administrator or
other fiduciary of such Company Benefit
Plan, or any agent of the foregoing, has
engaged that could reasonably be
expected to subject the Company or any of
its Subsidiaries or any of their
respective employees, or any such trustee,
administrator or other fiduciary, to
the tax or penalty on prohibited
transactions imposed by Section 4975 of the
Code or the sanctions imposed under Title I
of ERISA and (B) neither the
Company, any of its Subsidiaries or any of
their respective employees nor, to
the Knowledge of the Company, any trustee,
administrator or other fiduciary of
any Company Benefit Plan nor any agent of
any of the foregoing, has engaged in
any transaction or acted in a manner, or
failed to act in a manner, that could
reasonably be expected to subject the
Company or any of its Subsidiaries or any
of their respective employees or, to the
Knowledge of the Company, any such
trustee, administrator or other fiduciary,
to any liability for breach of
fiduciary duty under ERISA or any other
applicable Law.
(ix) Each Company Welfare Plan may be amended or terminated
(including
with respect to benefits provided to
retirees and other former employees)
without material liability to the Company
or any of its Subsidiaries at any time
after the Effective Time. Each of the
Company and its Subsidiaries complies in
all material respects with the applicable
requirements of Section 4980B(f) of
the Code, Sections 601-609 of ERISA or any
similar state or local Law with
respect to each Company Benefit Plan that
is a group health plan, as such term
is defined in Section 5000(b)(1) of the
Code or such state Law. Neither the
Company nor any of its Subsidiaries has any
material obligations for health or
life insurance benefits following
termination of employment under any Company
Benefit Plan (other than for continuation
coverage required under Section
4980(B)(f) of the Code).
(x) None of the execution and delivery of this Agreement, the
obtaining
of the Shareholder Approval or the
consummation of the Merger or any other
transaction contemplated by this Agreement
(alone or in conjunction with any
other event, including as a result of any
termination of employment on or
following the Effective Time) will (A)
entitle any current or former director,
officer, employee or consultant of the
Company or any of its Subsidiaries to
severance or termination pay, (B)
accelerate the time of payment or vesting, or
trigger any payment or funding (through a
grantor trust or otherwise) of,
compensation or benefits under, increase
the amount payable or trigger any other
material obligation pursuant to, any
Company Benefit Plan or Company Benefit
Agreement or (C) result in any breach or
violation of, or a default under, any
Company Benefit Plan or Company Benefit
Agreement.
(xi) Neither the Company nor any of its Subsidiaries has any
material
liability or obligations, including under
or on account of a Company Benefit
Plan, arising out of the hiring of persons
to provide services to the Company or
any of its Subsidiaries and treating such
persons as consultants or independent
contractors and not as employees of the
Company or any of its Subsidiaries. No
current or former independent contractor
that provides or provided personal
services to the Company or its Subsidiaries
(other than a current or former
director) is entitled to any material
fringe or other benefits (other than cash
consulting fees) pursuant to any plan,
program, policy or Contract to which the
Company or any of its Subsidiaries is a
party or which is maintained, sponsored
or contributed to by the Company or any of
its Subsidiaries.
(xii) No material deduction by the Company or any of its
Subsidiaries
in respect of any "applicable employee
remuneration" (within the meaning of
Section 162(m) of the Code) has been
disallowed or is subject to disallowance by
reason of Section 162(m) of the Code. For
each of the Key Personnel, the Company
has previously provided to Parent (A)
accurate Form W-2 information for the
1999, 2000, 2001, 2002 and 2003 calendar
years, (B) annual base salary as of the
date hereof, actual bonus earned for the
2003 calendar year and target annual
bonus for the 2004 calendar year and (C) a
list, as of the date hereof, of all
outstanding Company Stock Options, Company
Restricted Stock and Company
Stock-Based Awards granted under the
Company Stock Plans or otherwise (other
than rights under the ESPP), together with
(as applicable) the number of shares
of Company Common Stock subject thereto,
and the grant dates, expiration dates,
exercise or base prices and vesting
schedules thereof, (D) estimated current
annual cost of welfare benefits and (E)
estimated cost of the pension benefit
enhancement under Section 8 of the
Company's Change in Control Severance Plan
for Select Employees.
(m) No Parachute Gross Up. Except as provided in accordance with
the
Company's Change in Control Severance Pay
Plan for Select Employees, no current
or former employee or director of the
Company or any of its Subsidiaries is
entitled to receive any additional payment
from the Company or any of its
Subsidiaries or the Surviving Corporation
by reason of the excise tax required
by Section 4999(a) of the Code being
imposed on such person by reason of the
transactions contemplated by this
Agreement.
(n) Taxes. Except as has not had and would not reasonably be
expected
to have a Material Adverse Effect:
(i) All tax returns required by applicable Law to have been filed
with
any taxing authority by, or on behalf of,
the Company or any of its Subsidiaries
have been filed in a timely manner (taking
into account any valid extension) in
accordance with all applicable Laws, and
all such tax returns are true and
complete in all material respects.
(ii) The Company and each of its Subsidiaries has paid (or has had
paid
on its behalf) all taxes due and owing, and
the Company's most recent financial
statements included in the Filed Company
SEC Documents reflect an adequate
accrual for all taxes payable by Company
and its Subsidiaries for all taxable
periods and portions thereof accrued
through the date of such financial
statements.
(iii) There are no Liens or encumbrances for taxes on any of the
assets
of the Company or any of its Subsidiaries
other than for taxes not yet due and
payable.
(iv) The Company and its Subsidiaries have complied with all
applicable
Laws relating to the payment and
withholding of taxes.
(v) No written notification has been received by the Company or any
of
its Subsidiaries that any federal, state,
local or foreign audit, examination or
similar proceeding is pending, proposed or
asserted with regard to any taxes or
tax returns of the Company or its
Subsidiaries.
(vi) There is no currently effective Contract extending, or having
the
effect of extending, the period of
assessment or collection of any federal,
state and, to the Knowledge of the Company,
foreign taxes with respect to the
Company or any of its Subsidiaries nor has
any request been made for any such
extension.
(vii) No written notice of a claim of pending investigation has
been
received from any state, local or other
jurisdiction with which the Company or
any of its Subsidiaries currently does not
file tax returns, alleging that the
Company or any of its Subsidiaries has a
duty to file tax returns and pay taxes
or is otherwise subject to the taxing
authority of such jurisdiction.
(viii) Neither the Company nor any of its Subsidiaries joins or
has
joined, for any taxable period during the
eight years prior to the date of this
Agreement, in the filing of any affiliated,
aggregate, consolidated, combined or
unitary federal, state, local and, to the
Knowledge of the Company, foreign tax
return other than consolidated tax returns
for the consolidated group of which
the Company is the common parent.
(ix) Neither the Company nor any of its Subsidiaries is a party to
or
bound by any tax sharing agreement or tax
indemnity agreement, arrangement or
practice (including any advance pricing
agreement, closing agreement or other
agreement relating to taxes with any taxing
authority).
(x) Neither the Company nor any of its Subsidiaries has
constituted
either a "distributing corporation" or a
"controlled corporation" in a
distribution of stock qualifying for
tax-free treatment under Section 355 of the
Code in the two years prior to the date of
this Agreement.
(xi) Neither the Company nor any of its Subsidiaries will be
required
to include in a taxable period ending after
the Effective Time taxable income
attributable to income that accrued in a
prior taxable period (or portion of a
taxable period) but was not recognized for
tax purposes in any prior taxable
period as a result of (A) an open
transaction disposition made on or before the
Effective Time, (B) a prepaid amount
received on or prior to the Effective Time,
(C) the installment method of accounting,
(D) the long-term contract method of
accounting, (E) the cash method of
accounting or Section 481 of the Code or (F)
any comparable provisions of state or local
tax Law, domestic or foreign, or for
any other reason, other than any amounts
that are specifically reflected in a
reserve for taxes on the most recent
financial statements of the Company
included in the Filed Company SEC
Documents.
(xii) Neither the Company nor any of its Subsidiaries has entered
into
a "listed transaction" within the meaning
of Treasury Regulation ss.
1.6011-4(b)(2)
(xiii) As used in this Agreement (A) "tax" means (i) any tax,
duty,
governmental fee or other like assessment
or charge of any kind whatsoever
(including withholding on amounts paid to
or by any person and liabilities with
respect to unclaimed funds), together with
any related interest, penalty,
addition to tax or additional amount, and
any liability for any of the foregoing
as transferee, (ii) in the case of the
Company or any of its Subsidiaries,
liability for the payment of any amount of
the type described in clause (i) as a
result of being or having been before the
Effective Time a member of an
affiliated, consolidated, combined or
unitary group, or a party to any Contract
as a result of which liability of the
Company or any of its Subsidiaries is
determined or taken into account with
reference to the activities of any other
person and (iii) in the case of the Company
or any of its Subsidiaries,
liability of the Company or any of its
Subsidiaries for the payment of any
amount as a result of being party to any
tax sharing Contract or with respect to
the payment of any amount imposed on any
person of the type described in (i) or
(ii) as a result of any existing Contract
(including an indemnification
Contract); (B) "taxing authority" means any
Federal, state, local or foreign
government, any subdivision, agency,
commission or authority thereof, or any
quasi-governmental body exercising tax
regulatory authority; and (C) "tax
return" means any report, return, document,
declaration or other information or
filing required to be filed with respect to
taxes (whether or not a payment is
required to be made with respect to such
filing), including information returns,
any documents with respect to or
accompanying payments of estimated taxes, or
with respect to or accompanying requests
for the extension of time in which to
file any such report, return, document,
declaration or other information.
(o) Title to Properties. Each of the Company and its Subsidiaries
has
valid title to, or valid leasehold or
sublease interests or other comparable
contract rights in or relating to all of
its real properties and other tangible
assets necessary for the conduct of its
business as currently conducted, except
as have been disposed of in the ordinary
course of business and except for
defects in title, easements, restrictive
covenants and similar encumbrances that
individually or in the aggregate have not
had and would not reasonably be
expected to have a Material Adverse Effect.
Each of the Company and its
Subsidiaries has complied with the terms of
all leases or subleases to which it
is a party and under which it is in
occupancy, and all leases to which the
Company is a party and under which it is in
occupancy are in full force and
effect, except for such failure to comply
or be in full force and effect that
individually or in the aggregate has not
had and would not reasonably be
expected to have a Material Adverse Effect.
Neither the Company nor any of its
Subsidiaries has received any written
notice of any event or occurrence that has
resulted or could result (with or without
the giving of notice, the lapse of
time or both) in a default with respect to
any lease or sublease to which it is
a party, which defaults individually or in
the aggregate have had or would
reasonably be expected to have a Material
Adverse Effect.
(p) Intellectual Property. (i) Section 3.01(p)(i) of the
Company
Disclosure Schedule sets forth, as of the
date hereof, a complete and accurate
list (in all material respects) of all
patents and applications therefor,
registered trademarks and applications
therefor, domain name registrations and
copyright registrations (if any) that, in
each case, are owned by or licensed to
the Company or any of its Subsidiaries and
are material to the conduct of the
business of the Company and its
Subsidiaries, taken as a whole, as currently
conducted. Such intellectual property
rights required to be listed in Section
3.01(p)(i) of the Company Disclosure
Schedule, together with any tradename
rights, trade secret or know how rights,
service mark rights, trademark rights,
patent rights, intellectual property rights
in computer programs or software or
other type of intellectual property rights,
in each case, that are owned or
licensed by the Company or any of its
Subsidiaries and are material to the
conduct of the business of the Company and
its Subsidiaries, taken as a whole,
as currently conducted, are collectively
referred to herein as "Intellectual
Property Rights". All Intellectual Property
Rights are either (x) owned by the
Company or a Subsidiary of the Company free
and clear of all Liens or (y)
licensed to the Company or a Subsidiary of
the Company free and clear (to the
Knowledge of the Company) of all Liens,
except where the failure to so own or
license such Intellectual Property Rights
individually or in the aggregate has
not had and would not reasonably be
expected to have a Material Adverse Effect.
There are no claims pending or, to the
Knowledge of the Company, threatened with
regard to the ownership or, to the
Knowledge of the Company, licensing by the
Company or any of its Subsidiaries of any
Intellectual Property Rights which
individually or in the aggregate has had or
would reasonably be expected to have
a Material Adverse Effect. Each of the
Company and its Subsidiaries owns, is
validly licensed or otherwise has the right
to use all Intellectual Property
Rights, except where the failure to own,
have a valid license or otherwise have
rights to use individually or in the
aggregate has not had and would not
reasonably be expected to have a Material
Adverse Effect. The execution and
delivery of this Agreement by the Company
do not, and the consummation by the
Company of the Merger and the other
transactions contemplated by this Agreement
and compliance by the Company with the
provisions of this Agreement will not,
conflict with, or result in any violation
or breach of, or default (with or
without notice or lapse of time, or both)
under, or give rise to a right of, or
result in, termination, cancelation or
acceleration of any obligation or to the
loss of a benefit under, or result in the
creation of any Lien in or upon, any
Intellectual Property Right, in each case
that individually or in the aggregate
has had or would reasonably be expected to
have a Material Adverse Effect.
Section 3.01(p)(i) of the Company
Disclosure Schedule sets forth, as of the date
hereof, all Contracts under which the
Company or any of its Subsidiaries is
obligated to make payments to third parties
for use of any Intellectual Property
Rights with respect to the
commercialization of any products that are, as of the
date hereof, being sold, manufactured by or
under development by the Company or
any of its Subsidiaries and for which such
payments are in excess of $2,000,000
per year for any single product. The
aggregate amount of all such payments that
the Company and its Subsidiaries are
obligated to make under any Contract of the
type described in the immediately preceding
sentence that are not required to be
disclosed pursuant to such sentence does
not exceed $10,000,000 per year.
(ii) There are no pending or, to the Knowledge of the Company,
threatened claims that the Company or any
of its Subsidiaries has infringed or
is infringing (including with respect to
the manufacture, use or sale by the
Company or any of its Subsidiaries of any
products or to the operations of the
Company and its Subsidiaries) any
intellectual property rights of any person
which individually or in the aggregate has
had or would reasonably be expected
to have a Material Adverse Effect. To the
Knowledge of the Company, as of the
date of this Agreement, there are no facts,
circumstances or conditions that
would reasonably be expected to form the
basis for any claim by a person to
exclude or prevent the Company or any of
its Subsidiaries from freely using its
Intellectual Property Rights and that
individually or in the aggregate would
reasonably be expected to have a Material
Adverse Effect.
(iii) All patents required to be listed in Section 3.01(p)(i) of
the
Company Disclosure Schedule that are owned
by the Company or any of its
Subsidiaries have been duly registered
and/or filed with or issued by each
appropriate Governmental Entity, all
necessary affidavits of continuing use have
been timely filed, and all necessary
maintenance fees have been timely paid to
continue all such rights in effect, other
than failures to be duly registered,
filed, issued or paid which individually or
in the aggregate have not had and
would not reasonably be expected to have a
Material Adverse Effect. None of the
patents required to be listed in Section
3.01(p)(i) of the Company Disclosure
Schedule that are owned by the Company or
any of its Subsidiaries has expired or
been declared invalid, in whole or in part,
by any Governmental Entity, other
than such expirations or declarations of
invalidity which individually or in the
aggregate have not had and would not
reasonably be expected to have a Material
Adverse Effect. There are no ongoing
interferences, oppositions, reissues,
reexaminations or other proceedings
challenging any of the patents or patent
applications required to be listed in
Section 3.01(p)(i) of the Company
Disclosure Schedule and owned by the
Company or any of its Subsidiaries (or, to
the Company's Knowledge, challenging any
such patents or patent applications
licensed to the Company or any of its
Subsidiaries), including ex parte and
post-grant proceedings, in the United
States Patent and Trademark Office or in
any foreign patent office or similar
administrative agency, other than such
interferences, oppositions, reissues,
reexaminations or proceedings that
individually or in the aggregate have not
had and would not reasonably be
expected to have a Material Adverse
Effect.
(iv) Except as has not had and would not reasonably be expected to
have
a Material Adverse Effect, the Company and
its Subsidiaries have used
commercially reasonable efforts to maintain
their material trade secrets in
confidence.
(q) Voting Requirements. The affirmative vote of holders of a
majority
of the outstanding shares of Company Common
Stock at the Shareholders' Meeting
or any adjournment or postponement thereof
to approve this Agreement (the
"Shareholder Approval") is the only vote of
the holders of any class or series
of capital stock of the Company necessary
to approve this Agreement and the
transactions contemplated by this Agreement
(it being understood that the
approval of the Original Merger Agreement
by the shareholders of the Company on
April 27, 2005, shall not constitute the
"Shareholder Approval" with regard to
this Agreement).
(r) State Takeover Laws; Company Articles Provisions. The Board
of
Directors of the Company has unanimously
adopted, by all directors present, this
Agreement, the terms of this Agreement and
the consummation of the Merger and
the other transactions contemplated by this
Agreement, and such adoption
represents all the actions necessary to
render inapplicable to this Agreement,
the Merger and the other transactions
contemplated by this Agreement, the
restrictions (i) on "business combinations"
(as defined in Section 23-1-43-5 of
the IBCL) set forth in Section 23-1-43-18
of the IBCL and (ii) on the actions or
transactions set forth in Paragraph 6 of
the Company Articles ("Paragraph 6"),
in each case to the extent, if any, such
restrictions would otherwise be
applicable to this Agreement, the Merger
and the other transactions contemplated
by this Agreement. For purposes of
Paragraph 6, the approval of the Board of
Directors of the Company referred to in the
immediately preceding sentence
constitutes the approval of the Merger and
the other transactions contemplated
by this Agreement by the "Continuing
Directors" (as defined in Paragraph 6)
pursuant to clause (c) of Paragraph 6. No
other similar provision of the Company
Articles or the Company By-laws or, to the
Knowledge of the Company, other state
takeover Law or similar Law applies or
purports to apply to this Agreement, the
Merger or the other transactions
contemplated by this Agreement.
(s) Brokers and Other Advisors. No broker, investment banker,
financial
advisor or other person (other than J.P.
Morgan Securities Inc. and Morgan
Stanley & Co. Incorporated), the fees
and expenses of which will be paid by the
Company, is entitled to any broker's,
finder's, financial advisor's or other
similar fee or commission in connection
with the transactions contemplated by
this Agreement based upon arrangements made
by or on behalf of the Company. The
Company has delivered to Parent complete
and accurate copies of all Contracts
under which any such fees or expenses are
payable and all indemnification and
other Contracts related to the engagement
of the persons to whom such fees are
payable.
(t) Opinion of Financial Advisors. The Company has received the
opinions of each of J.P. Morgan Securities
Inc. and Morgan Stanley & Co.
Incorporated, in each case dated as of
November 14, 2005, to the effect that, as
of such date, the Merger Consideration is
fair, from a financial point of view,
to the holders of shares of Company Common
Stock, a signed copy of which opinion
has been, or will promptly be, delivered to
Parent.
(u) Regulatory Compliance. (i) As to each product subject to the
FDCA
or similar Legal Provisions in any foreign
jurisdiction that are developed,
manufactured, tested, distributed and/or
marketed by the Company or any of its
Subsidiaries (a "Medical Device"), each
such Medical Device is being developed,
manufactured, tested, distributed and/or
marketed in compliance with all
applicable requirements under the FDCA and
similar Legal
