EXHIBIT 10.1
ACQUISITION
AGREEMENT
by and between
ALPHATEC HOLDINGS,
INC.,
and
OLIVIER CARLI
Dated as of September 27,
2006
THIS ACQUISITION AGREEMENT (this
“ Agreement ”) is made and entered into as of
September 27, 2006, is by and between Alphatec Holdings, Inc.,
a Delaware corporation (“ Issuer ”) and Olivier
Carli, an individual resident of Switzerland (“ Olivier
Carli ”). Issuer and Olivier Carli are sometimes referred
to herein each, individually, as a “ Party ”
and, collectively, as the “ Parties .” Certain
terms are defined in Section 11.9 or 11.10.
WHEREAS, Olivier Carli owns
2,068,650 shares (the “ Company Shares ”)
representing 59.10% of the share capital (of which 2,068,150 have
double voting rights) of Ideal Medical Products, a French
société anonyme with a share capital of 1,400,000
Euros (the “ Company ”);
WHEREAS, the Company owns 66.9% of
the outstanding shares (the “ Scient’x Shares
”) of Scient’x, a French société
anonyme with a share capital of 2,986,158 Euros (“
Scient’x ”).
WHEREAS, the Board of Directors of
Issuer (the “ Issuer Board ”) has determined
that it is in the best interests of its stockholders for Issuer to
acquire the Company upon the terms and subject to the conditions
set forth in this Agreement;
WHEREAS, in furtherance of such
acquisition, a wholly-owned indirect Subsidiary of the Issuer (the
“ Merger Sub ”) will merge with and into the
Issuer, with the Issuer continuing as the surviving corporation
(the “ Issuer Subsidiary Merger ”);
WHEREAS, in furtherance of such
acquisition, Issuer agrees to acquire the Company Shares held by
Olivier Carli in exchange for shares of common stock, par value
$0.0001 per share, of the Issuer or the successor registrant on
consummation of the Issuer Subsidiary Merger (the “
Shares ”), and cash upon the terms and subject to the
conditions of this Agreement;
WHEREAS, the Issuer Board has
unanimously approved this Agreement and the transactions
contemplated by this Agreement, including the issuance of the Stock
Portion and the Cash Portion to Olivier Carli in exchange for the
Company Shares (collectively, the “ Transaction
”);
WHEREAS, upon the terms and subject
to the conditions in this Agreement, prior to the Closing, the
Company shall (i) call a shareholders’ meeting in order
to approve (1) the transfer to a wholly owned subsidiary
(“ Newco ”) all of the assets of the Company
(including the name Ideal Medical Products) other than the
Scient’x Shares and all liabilities of the Company, except
(a) those set forth on Schedule A ; (b) the
Company Transaction Expenses (as defined herein) and (c) the
Asset Transfer Expenses; and (2) the change of the Company
name into a name referring to Scient’X (the “
Contribution ”); (ii) complete the sale of the
shares of Newco to Olivier Carli for a price equal to €10
million (the “ Asset Purchase Price ”, which
such purchase price having been established without any analysis or
participation of the Issuer or its financial advisors), the
fairness of such purchase price having been certified by an
independent expert in accordance with French Law and
(iii) approve the payment, through distribution of an advance
dividend ( acompte sur dividendes ) and/or distribution of
reserves and/or reduction of share capital, to Company shareholders
of an amount equal to the Asset Purchase Price, less (x) an
amount equal to two-thirds of the Company Transaction Expenses and
(y) 100 % of the estimated tax liabilities and the Asset
Transfer Expenses, if any (such actions set forth in
(i) through (iii) collectively, the “ Asset
Transfer ”);
WHEREAS, prior to the execution and delivery of
this Agreement, certain officers and directors of Issuer,
concurrently herewith, are entering into a stockholders support
agreement, dated as of the date hereof, pursuant to which each has,
among other things, upon the terms and subject to the conditions
set forth therein, irrevocably agreed to vote all Shares held by
such individuals in favor of the transactions contemplated by this
Agreement, and agreed to a standstill with respect to the Shares
between the date hereof and the Issuer Stockholders’
Meeting;
WHEREAS, concurrently with the
execution and delivery of this Agreement, Issuer is entering into
an agreement with HealthPoint (Luxembourg) I Sarl (“
Luxco ”) pursuant to which Issuer will issue Shares in
exchange for all of the outstanding stock of Luxco on economic
terms expressing the same value for Scient’x as is
contemplated in the Agreement (the “ Luxco Exchange
”);
WHEREAS, the Board has unanimously
approved the transactions contemplated by this Agreement, with
Olivier Carli having abstained from the vote; and
NOW, THEREFORE, in consideration of
the foregoing and the mutual representations, warranties, covenants
and agreements herein contained, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties hereby agree as follows:
ARTICLE I
EXCHANGE OF SHARES
1.1 Exchange of Shares . Upon
the terms and subject to the conditions contained in this
Agreement, at the Closing Olivier Carli shall sell, assign,
transfer, convey and deliver to the Issuer, and the Issuer shall
purchase, acquire and accept for delivery from Olivier Carli,
2,068,650 Company Shares, which represent all of the Company Shares
beneficially owned by Olivier Carli.
1.2 Purchase Price . The
aggregate purchase price to be paid to Olivier Carli for the
2,068,650 Company Shares shall be:
(a) an amount of cash (the “
Cash Portion ”) equal to: (x) 15% multiplied by
(y) the IMP Share Price and (z) the 2,068,650 Company
Shares owned by Olivier Carli; and
(b) a number of Shares (the “
Share Number ”) equal to: (x) the product of
(A) 85% multiplied by (B) the IMP Share Price and
(C) the 2,068,650 Company Shares owned by Olivier Carli
divided by (y) the Issuer Common Stock Price (the
“ Stock Portion ” and together with the Cash
Portion, the “ Purchase Price ”);
(c) the “ IMP Share
Price ” shall be 25.54 Euros.
(d) For the avoidance of doubt,
subject to the indemnity provisions of Article IX and
Article X , the Purchase Price paid hereunder to Olivier
Carli shall not be subject to any purchase price adjustment
whatsoever.
2
1.3 Fractional Shares . No
certificates or scrip representing fractional Shares shall be
issued pursuant to this Agreement and such fractional share
interests will not entitle the owner thereof to vote or to any
other rights of a stockholder of Issuer. In lieu of such fractional
share interest, if any, Olivier Carli shall be paid an amount in
cash equal to the product obtained by multiplying (i) such
fractional share interest to which Olivier Carli would otherwise be
entitled by (ii) the Issuer Common Stock Price.
1.4 Payment of Purchase Price
. At the Closing, Issuer shall pay to Olivier Carli the Purchase
Price as follows:
(a) Delivery to the Escrow Agent of
10% of the Cash Portion (the “ Escrow Cash ”)
and 10% of the Stock Portion (the “ Escrow Shares
” and together with the Escrow Cash, the “ Escrow
Fund ”) pursuant to the Escrow Agreement;
(b) Delivery to Olivier Carli by
wire transfer of immediately available funds of an amount equal to
the Cash Portion less the Escrow Cash; and
(c) Delivery to Olivier Carli of a
number of Shares equal to the product of (x) the Share Number
less the Escrow Shares.
1.5 Closing Deliveries by Olivier
Carli .
(a) At the Closing, Olivier Carli
shall deliver, or cause to be delivered to the Issuer:
(i) a share transfer order (
ordre de mouvement ) for all of the Company Shares held by
Olivier Carli, completed pursuant to the terms hereof and any other
documents necessary for the transfer of good and marketable title
to the Company Shares; and
(ii) the certificates and other
documents required to be delivered pursuant to
Section 7.2.
(b) At the Closing, Olivier Carli
shall cause the Company to make appropriate entries in the
corporate books of the Company and/or books of the
intermédiaire habilité to register the
consummation of the Transaction.
1.6 Closing Deliveries by the
Issuer . At the Closing, the Issuer shall deliver, or cause to
be delivered, to Olivier Carli:
(a) stock certificates in the name
of Olivier Carli evidencing the number of Shares determined in
accordance with Section 1.4;
(b) cash in the amount determined in
accordance with Section 1.4; and
(c) the certificates and other
documents required to be delivered pursuant to
Section 7.3.
3
1.7 Other Closing Delivery
. Olivier Carli and the Issuer will enter into an employment
agreement incorporating the terms and conditions set forth on the
term sheet attached hereto as Schedule B .
1.8 The Parties agree that all
actions required to be taken, and all deliverables required to be
delivered, at Closing shall be deemed to have been taken or
delivered simultaneously and that unless and until all such actions
have been taken and all such deliverables have been delivered no
Closing shall have occurred. The Asset Transfer shall be completed
immediately prior to the Closing.
1.9 Restricted Securities .
The Shares shall be subject to restrictions on sale pursuant to a
stockholders agreement, which shall include a lock-up period of 180
days and incorporate the other terms and conditions set forth in
the term sheet attached hereto as Schedule C (the “
Stockholders Agreement ”). Notwithstanding the 180 day
lock-up, Olivier Carli shall be entitled to pledge up to 10% of his
Shares. All certificates representing such Shares shall bear, in
addition to any other legends required under applicable securities
laws, the following legend:
“THE SHARES REPRESENTED BY
THIS CERTIFICATE ARE SUBJECT TO A STOCKHOLDERS’ AGREEMENT AND
MAY NOT BE TRANSFERRED, SOLD OR PLEDGED EXCEPT PURSUANT TO THE
TERMS AND CONDITIONS SET FORTH IN SUCH STOCKHOLDERS AGREEMENT. A
COPY OF SUCH AGREEMENT MAY BE INSPECTED AT THE PRINCIPAL OFFICE OF
THE ISSUER”.
1.10 Closing . Unless this
Agreement shall have been terminated and the transactions
contemplated by this Agreement abandoned pursuant to the provisions
of ARTICLE VIII, and subject to the satisfaction or waiver, as the
case may be, of the conditions set forth in ARTICLE VII, the
closing of the Transaction and the other transactions contemplated
by this Agreement (the “ Closing ”) shall take
place at 10:00 a.m. (Paris time) on a date to be mutually agreed
upon by the Parties (the “ Closing Date ”),
which date shall be no later than the fifth Business Day after all
the conditions set forth in ARTICLE VII (excluding conditions that,
by their nature, cannot be satisfied until the Closing) shall have
been satisfied or waived in accordance with Section 8.4. The
Closing shall take place at the offices of Weil, Gotshal &
Manges, 2 rue de la Baume, 75008 Paris, or at such other location
as is agreed to by the Parties. For purposes of this Agreement,
“ Business Day ” shall mean any day other than a
Saturday or a Sunday on which banks are opened in both New York,
New York, United States and Paris, France.
1.11 Taking of Necessary Action;
Further Action . If, at any time and from time to time after
the Closing, any further action is necessary or desirable to vest
in Issuer full right, title and possession over the Company Shares,
Olivier Carli shall take, or cause to be taken all such lawful and
necessary action as is consistent with this Agreement.
1.12 Sale of Company Shares Owned
by Christian Carli . Olivier Carli undertakes to cause
Christian Carli to sell, assign, convey and deliver to the Issuer
at the Closing the 77,800 Company Shares (representing 2.2% of the
share capital, all of such shares having double voting rights of
the Company), at the price conditions as the sale of the Company
Shares owned by Olivier Carli to the Issuer and enter into an
acquisition agreement, the form of which is attached as Schedule
D .
4
ARTICLE II
REPRESENTATIONS AND WARRANTIES
REGARDING THE COMPANY
Except as set forth in the
disclosure schedule provided to Issuer on the date hereof and which
is attached as Schedule E and accepted in writing by Issuer
(the “ Company Disclosure Schedule ”), Olivier
Carli, hereby represents and warrants to Issuer that the statements
contained in this ARTICLE II are true, complete and correct. The
Company Disclosure Schedule shall be arranged in paragraphs
corresponding to the numbered and lettered paragraphs contained in
this ARTICLE II, and the disclosure in any paragraph shall be
deemed to be disclosed in each other paragraph in which it is
reasonably appropriate for such matters to be disclosed. As used in
this Agreement, a “ Company Material Adverse Effect
” means any change, event or effect that has a material and
adverse effect to the business, assets (including, without
limitation, intangible assets), financial condition, results of
operations or reasonably foreseeable prospects of the Company and
its Subsidiaries, taken as a whole, excluding any changes, events
or effects that are attributable to: (i) conditions that
materially and adversely affect the general worldwide economy,
which changes do not disproportionately affect the Company and its
Subsidiaries; or (ii) conditions that materially and adversely
affect the industries in which the Company and its Subsidiaries
compete, which changes do not disproportionately affect the Company
and its Subsidiaries relative to other participants in such
industry. For the avoidance of doubt, decreases in the
Company’s stock price in and of itself is not a Company
Material Adverse Effect, provided that this sentence shall not
preclude the other Party from asserting that the underlying cause
of any such decrease in stock price is a Company Material Adverse
Effect.
2.1 Organization and
Qualification .
(a) Each of the Company and
Scient’x is a French société anonyme , duly
organized and validly existing under the laws of France registered
and with the Registry of Commerce and Companies ( Registre du
Commerce et des Sociétés ), as applicable, under
numbers RCS Paris 339 751 489 and RCS Versailles 348 366
733, respectively. Each of the Company and Scient’x is duly
qualified or licensed as a foreign corporation to conduct business,
and is in corporate good standing, under the laws of each
jurisdiction where the character of the properties owned, leased or
operated by it, or the nature of its activities, makes such
qualification or licensing necessary, except where the failure to
be so qualified, licensed or in good standing, individually or in
the aggregate, has not had and would not reasonably be expected to
have a Company Material Adverse Effect. Each of the Company and
Scient’x has made available to Issuer true, complete and
correct copies of its articles of association ( statuts ) as
amended to date. Neither the Company nor Scient’x is in
default under or in violation of any provision of its articles of
association. The filings with the Registry of Commerce and
Companies of each of the Company and Scient’x are complete
and up-to-date in all material respects; the current excerpts (
extraits Kbis ) from the Registry of Commerce and Companies
regarding each of the Company and Scient’x delivered to
Issuer are true and accurate as of their respective
dates.
5
(b) Neither the Company nor
Scient’x is in a state of insolvency or unable to meet its
payment obligations as they become due ( cessation des
paiements ) and is not and has never been subject to a judicial
reorganization ( redressement judiciaire ), judicial
liquidation ( liquidation judiciaire ) or voluntary
reorganization ( procédure de sauvegarde ) proceeding
or any receivership or composition with creditors (
règlement amiable ) or collective bankruptcy
proceedings provided for by the French commercial code ( Code de
commerce ), nor have they requested an extension period (
délai de grace ) pursuant to Article 1244-1 of the
French Civil Code ( Code civil ). The Company has not been
over the last five years, directly or indirectly a member of any
partnership ( société en nom collectif or
société en participation ), joint venture,
economic interest grouping, or any other organization or structure
having unlimited liability.
(c) The attendance register of the
conseil d’administration , the minutes of the
conseil d’administration and the shareholders meetings
and the share registers (the registre des mouvements de
titres and the comptes d’actionnaires ) required
by the French Code de Commerce are up-to-date for each of the
Company and Scient’x, have been fully maintained and contain
true and accurate records in all material respects. There have been
no meetings or proceedings of the conseil
d’administration or the shareholders of either the
Company or Scient’x, other than those reflected in the
records of such Person. The minutes and other corporate records of
each of the Company and Scient’x are accurate in all material
respects and up-to-date and true and complete copies of the minutes
of Scient’x have been provided to the Issuer via the
electronic data room of Scient’x.
2.2 Subsidiaries .
(a) The Company Disclosure Schedule
sets forth a true, complete and correct list of each direct or
indirect Subsidiary of the Company (including Scient’x and
all subsidiaries of Scient’x).
(b) Each direct or indirect
Subsidiary of the Company is a corporation duly organized, validly
existing and in corporate good standing under the laws of the
jurisdiction of its incorporation, and is duly qualified or
licensed as a foreign corporation to conduct business, and is in
corporate good standing, under the laws of each jurisdiction where
the character of the properties and other assets owned, leased or
operated by it, or the nature of its activities, makes such
qualification or licensing necessary. The Company has made
available to Issuer true, complete and correct copies of the
Certificate of Incorporation, Bylaws or other charter or equivalent
organizational documents of each of the direct and indirect
Subsidiaries of Scient’x, each as amended to date.
2.3 Capital
Structure.
(a) The Company.
(i) The Company has a share capital
of €1,400,000 consisting of 3,500,000 ordinary shares,
nominal value €0.40 per share.
(ii) As of the date hereof:
(1) 3,500,000 ordinary shares are issued and outstanding (of
which Olivier Carli holds 2,068,150 shares benefiting from
double-voting rights); (2) 3,045 ordinary shares were held in
the treasury of the Company as of September 20,
6
2006 through two liquidity agreements entered
into respectively (a) by the Company and the financial
institution Gilbert Dupont, and (b) the Company and
Scient’x on the one hand and Wargny on the other ( actions
auto détenues ), it being specified that the number of
treasury shares changes on a daily basis through the
purchases/sales effected by the two liquidity providers;
(3) 1,127 ordinary shares were held by Scient’x on
September 22, 2006 ( actions auto controlées )
through the liquidity agreement entered into between the Company
and Scient’x on the one hand and Wargny on the other, it
being specified that the number of shares auto
contrôlées changes on a daily basis through the
purchases/sales effected by the Wargny; and (4) there are no
warrants, convertible notes or other securities (including employee
stock options) convertible or exchangeable for any shares of
capital stock of the Company or rights thereto. Except as described
in this paragraph, there are no shares of voting or non-voting
capital stock, equity interests or other securities of the Company
authorized, issued, reserved for issuance or otherwise
outstanding.
(iii) All outstanding ordinary
shares are duly authorized, validly issued, fully paid, and not
subject to, or issued in violation of, any kind of preemptive,
subscription or any kind of similar rights.
(b) Scient’x.
(i) Scient’x has a share
capital of €2,986,158 consisting of 11,944,632 ordinary
shares, nominal value €0.25 per share.
(ii) As of the date
hereof (i) 324,368 additional Scient’x Shares may
be issued upon exercise of the option outstanding under current
employee stock options plan(s) issued by Scient’x and
Scient’x U.S.A. (the “ Scient’x Option
Plans ”), and (ii) there are no warrants,
convertible notes or other securities convertible or exchangeable
for Scient’x Shares or any rights thereto. Except as
described in this paragraph, there are no shares of voting or
non-voting capital stock, equity interests or other securities of
Scient’x authorized, issued, reserved for issuance or
otherwise outstanding.
(iii) All outstanding Scient’x
Shares are, and all shares which may be issued pursuant to
Scient’x Option Plans will be, when issued against payment
therefore in accordance with the terms thereof, duly authorized,
validly issued, fully paid and non-assessable, and not subject to,
or issued in violation of, any kind of preemptive, subscription or
any kind of similar rights.
(c) Further
Representations.
(i) Each of the Company and
Scient’x satisfies all minimum capital requirements under
French Law. The transactions contemplated by this Agreement shall
not increase the minimum capital requirements under French
Law.
(ii) There are no bonds, debentures,
notes or other indebtedness of the Company or of Scient’x
having the right to vote (or convertible into securities having the
right to vote) on any matters on which shareholders of the Company
or Scient’x, as applicable, may vote. Except as described in
subsections (a)(ii), (a)(iii), (b)(ii) and (b)(iii) above, there
are no outstanding securities, options, warrants, calls, rights,
commitments, agreements, arrangements
7
or undertakings of any kind to which the Company
or Scient’x is a party or bound obligating the Company or
Scient’x, as applicable, to issue, deliver or sell, or cause
to be issued, delivered or sold, additional shares of capital stock
or other voting securities of the Company or Scient’x, as
applicable.
(iii) Each of the Company and
Scient’x has previously made available to Issuer a true,
complete and correct list of all the outstanding options and
warrants to purchase ordinary shares of the Company or
Scient’x Shares, including: (i) the date of grant;
(ii) the exercise price; (iii) the vesting schedule and
expiration date; and (iv) any other material terms, including,
without limitation, any terms regarding the acceleration of
vesting.
(iv) All ordinary shares of the
Company and Scient’x Shares, and all options and warrants to
purchase any such shares, were issued in compliance in all material
respects with all applicable securities Laws.
(v) There are no outstanding
contractual obligations of the Company or Scient’x to
repurchase, redeem or otherwise acquire any shares of capital stock
(or options to acquire any such shares) or other security or equity
interest of the Company or Scient’x, as applicable. There are
no stock-appreciation rights, security-based performance units,
phantom stock or other security rights pursuant to which any Person
is or may be entitled to receive any payment or other value based
on the revenues, earnings or financial performance or other
attribute of the Company or any of its Subsidiaries (including
Scient’x).
(vi) There are no voting trusts,
proxies or other agreements, commitments or understandings of any
character to which the Company or any of its Subsidiaries
(including Scient’x) or, to the knowledge of Olivier Carli,
any of the shareholders of the Company is a party or by which any
of them is bound with respect to the issuance, holding,
acquisition, voting or disposition of any shares of capital stock
or other security or equity interest of the Company or any of its
Subsidiaries.
(vii) All of the issued and
outstanding shares of capital stock of, or other equity interests
in, each Subsidiary of the Company are: (i) duly authorized,
validly issued and fully paid; (ii) owned, directly or
indirectly, by the Company (other than director’s qualifying
shares) free and clear of all liens, claims, security interests,
pledges and encumbrances of any kind or nature whatsoever
(collectively, “ Liens ”); and (iii) free
of any restriction, including, without limitation, any restriction
which prevents the payment of dividends to the Company or any other
Subsidiary of the Company, or which otherwise restricts the right
to vote, sell or otherwise dispose of such capital stock or other
ownership interest, other than restrictions under the Securities
Act of 1933, as amended (the “ Securities Act
”), and state securities laws.
2.4 Authority; No Conflict;
Required Filings .
No consent, approval, order or
authorization of, or registration, declaration or filing with, any
government, governmental, statutory, regulatory or administrative
authority, agency, body or commission or any court, tribunal or
judicial body, whether U.S., French, provincial, state, local or
foreign (each, a “ Governmental Authority ”) is
required by or with respect to the Company or any of its
Subsidiaries in connection with the execution and delivery of this
Agreement or the
8
consummation of the Transaction and other
transactions contemplated hereby except for (i) such filings,
notifications and authorizations as may be required by the French
Ministry of Economy and Finance, (ii) such filings,
authorizations, orders and approvals as may be required under
French securities law or for the purpose of the Asset Transfer,
(iii) compliance with any applicable requirements of Council
Regulation (EC) No. 139/2004 of the Council of the European
Union (the “EC Merger Regulation”),
(iv) compliance with any applicable requirements under the HSR
Act or (v) compliance with any applicable requirements of any
other French or foreign antitrust laws or regulations.
2.5 Filings .
(a) To Olivier Carli’s
knowledge, after having taken all reasonable measures to this
effect ( après avoir pris toute mesure raisonnable à
cet effet ), the annual report of the Company for the year
ended December 31, 2005 (the “ Company Annual
Report ”) did not at the time it was filed (or, if later
filed, amended or superseded, then on the date of such later
filing) contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary in
order to make the statements contained therein, in the light of the
circumstances under which it was made, not misleading.
(b) To Olivier Carli’s
knowledge, after having taken all reasonable measures to this
effect ( après avoir pris toute mesure raisonnable à
cet effet ), neither the Document de base of
Scient’x registered with the AMF on April 28, 2006, the
note d’opération registered with the AMF on
May 29, 2006 nor the International Offering Memorandum of
Scient’x dated May 29, 2006 (such three foregoing
documents, the “ Scient’x Documents ”) did
not at the time it was filed (or, if later filed, amended or
superseded, then on the date of such later filing) contain untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the
statements contained therein, in the light of the circumstances
under which they were made, not misleading.
(c) Subsequent to the date of the
issuance of the documents referred to in paragraphs (a) and
(b) above, the Company has, to Olivier Carli’s knowledge
after having taken all reasonable measures to this effect (
après avoir pris toute mesure raisonnable à cet
effet ), complied as to form in all material respects with the
applicable requirements of the Règlement général
de l’Autorité des marchés financiers relating
to public disclosures, and any filings from and after such date did
not, at the time it was filed, contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
contained therein, in the light of the circumstances under which
they were made, not misleading. Taken together with the information
and disclosures set forth in the Company Disclosure Schedule, as of
the date hereof the Company Annual Report and the Scient’x
Documents, as of the date hereof, contain all information that, if
known to the public, would have an impact on the trading price of
the Company Share ( qui serait susceptible d’avoir une
influence sur le cours de bourse ).
2.6 Agreements, Contracts and
Commitments .
(a) Issuer has been provided via the
Scient’x electronic data room with copies of all contracts
entered into by Scient’x or its Subsidiaries that would come
within the definition of “Material Contracts” under
Item 601(b)(10) of Regulation S-K promulgated under the
Securities Act (the “ Scient’x Material
Contracts ”).
9
(b) Each Scient’x Material
Contract is valid and binding on the respective parties
thereto and is in full force and effect. Neither Scient’x nor
any of its Subsidiaries is in breach of, or default under, any
Scient’x Material Contract.
ARTICLE III
REPRESENTATIONS AND WARRANTIES
REGARDING OLIVIER CARLI.
Except as set forth in the Company
Disclosure Schedule, Olivier Carli hereby represents and warrants
to the Issuer that:
3.1 Authority Relative to This
Agreement . This Agreement has been duly and validly executed
and delivered by Olivier Carli and, assuming the due authorization,
execution and delivery by the Issuer, constitutes a legal, valid
and binding obligation of Olivier Carli, enforceable against
Olivier Carli in accordance with its terms, subject only to:
(i) the effects of bankruptcy, insolvency, fraudulent
conveyance, reorganization, moratorium and other similar laws
relating to or affecting the enforcement of creditors’ rights
generally; (ii) general equitable principles (whether
considered in a proceeding in equity or at law); and (iii) an
implied covenant of good faith and fair dealing (collectively, the
“ Equitable Exceptions ”).
3.2 No Conflict .
(a) The execution and delivery of
this Agreement by Olivier Carli do not, and the performance of this
Agreement by Olivier Carli will not result in any breach of, or
constitute a default (or an event which, with notice or lapse of
time or both, would become a default) under, or give to others any
right of termination, amendment, acceleration or cancellation of,
or result in the creation of a Lien on any of the Company Shares
owned by Olivier Carli pursuant to, any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise
or other instrument or obligation to which Olivier Carli is a party
or by which Olivier Carli or the Company Shares owned by Olivier
Carli are bound or affected, except for any such conflicts,
violations, breaches, defaults or other occurrences which would not
reasonably be expected, individually or in the aggregate, to
prevent or materially delay consummation of the Transaction or
otherwise prevent or materially delay Olivier Carli from performing
his obligations under this Agreement.
(b) The execution and delivery of
this Agreement by Olivier Carli do not, and the performance of this
Agreement by Olivier Carli will not, require any consent, approval,
authorization or permit of, or filing with or notification to, any
Governmental Authority on the part of Olivier Carli, except for
(i) compliance with the EC Merger Regulation, or any French
antitrust regulation, as applicable or (ii) the pre-merger
notification and waiting period requirements of the HSR
Act.
3.3 Title to the Company
Shares . As of the date hereof, Olivier Carli is the record and
beneficial owner of the number of Company Shares set forth in
Section 1.1. Such Company
10
Shares are all the securities of the Company
owned both of record or beneficially, by Olivier Carli. The Company
Shares owned by Olivier Carli are now and, at all times prior to
the Closing will be, owned free and clear of all Liens, other than
any Liens created by this Agreement.
3.4 U.S. Tax Matters .
Olivier Carli has not entered into any binding commitment to sell,
exchange, transfer, distribute, or otherwise dispose of all or any
portion of the Shares, and is under no legal obligation to do
so.
3.5 Investment Intent
.
(a) Olivier Carli represents and
warrants to Issuer that he (i) is acquiring the Shares for
investment for his own account, and not with a view to, or for sale
in connection with, any distribution thereof, (ii) either
alone or together with his advisors, has sufficient knowledge and
experience in financial and business matters so as to be capable of
evaluating the merits and risks of his investment in the Shares and
is capable of bearing the economic risks of such investment,
(iii) is an “accredited investor” as defined in
Rule 501(a) of Regulation D under the Securities Act, and
(iv) understands and acknowledges that the Shares have not
been registered under the Securities Act and, unless so registered,
may not be offered, sold, transferred, or otherwise disposed of
except pursuant to an exemption from, or in a transaction not
subject to, the registration requirements of the Securities
Act.
(b) Olivier Carli understands and
acknowledges that the Shares will be inscribed with the following
legends, or another legend to the same effect and agrees to the
restrictions set forth therein:
“The shares represented by
this certificate have not been registered under the Securities Act
of 1933, as amended, in reliance upon an exemption from the
registration requirements of such Act. The shares represented by
this certificate may not be sold or otherwise transferred, nor will
an assignee or endorsee hereof be recognized as an owner of the
shares by the issuer unless (i) a registration statement under
the Securities Act of 1933 with respect to the shares and the
transfer thereof shall then be in effect, or (ii) in the
opinion of counsel reasonably satisfactory to the Issuer, the
shares are transferred in a transaction which is exempt from the
registration requirements of the Securities Act of 1933, as
amended.”
3.6 Surgiview SAS . Olivier
Carli represents that the purchase by Surgiview SAS of certain
assets owned by Eurosurgical SA has been completed in compliance
with French Law.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
ISSUER
Except as set forth in the
disclosure schedule provided to Olivier Carli on the date hereof,
which is attached as Schedule F , and accepted in writing by
Olivier Carli (the “ Issuer Disclosure Schedule
”), the Issuer represents and warrants to Olivier Carli as
follows:
4.1 Organization . Issuer is
a corporation duly incorporated, validly existing and in corporate
and tax good standing under the laws of its jurisdiction of
incorporation.
11
4.2 Capital . The authorized
capital stock of Issuer consists of 200,000,000 Shares and
20,000,000 shares of preferred stock, par value $0.0001 per share
(the “ Issuer Preferred Stock ”). At the close
of business on September 25, 2006, (i) 34,799,022 Shares
were issued and outstanding, (ii) no Shares were held by
Parent in its treasury, (iii) 6,400,000 Shares were reserved
for issuance under the Issuer’s Amended and Restated 2005
Employee Director and Consultant Stock Plan (collectively, the
“ Issuer Stock Plans ”) (of which 661,613 Shares
were subject to outstanding options to purchase Shares granted
under the Issuer Stock Plans), and (iv) 3,333,201 shares of
Issuer Preferred Stock were issued and outstanding. All Shares
deliverable pursuant to this Agreement have been duly authorized
(subject to obtaining the requisite approval of the Issuer
Transactions by the stockholders of the Issuer) and, when issued as
contemplated by this Agreement, will be validly issued, fully paid,
nonassessable and free of preemptive rights.
4.3 Authority; No Conflict;
Required Filings .
(a) Issuer has all requisite
corporate power and authority to execute and deliver this
Agreement, to perform its obligations hereunder and to consummate
the Transaction and other transactions contemplated
hereby. The execution and delivery of this Agreement, the
performance of its obligations hereunder and the consummation of
the Transaction and other transactions contemplated hereby, have
been duly authorized by all corporate action on the part of Issuer
and no other corporate proceedings are necessary.
(b) This Agreement has been duly
executed and delivered by Issuer and constitutes a valid and
binding obligation of Issuer, enforceable against it in accordance
with its terms, subject only to the Equitable
Exceptions.
(c) The execution and delivery of
this Agreement do not, and the performance by Issuer of its
obligations hereunder and the consummation of the Transaction and
other transactions contemplated hereby will not, conflict with or
result in any violation of, or default (with or without notice or
lapse of time, or both) under: (i) its Certificate of
Incorporation, Bylaws or other equivalent organizational documents;
(ii) subject to the governmental filings and other matters
referred to in paragraph (d) below, any (A) permit,
license, franchise, statute, law, ordinance or regulation or
(B) judgment, decree or order, in each case applicable to it,
or by which any of its properties or assets may be bound or
affected; or (iii) any loan or credit agreement, note, bond,
mortgage, indenture, contract, agreement, lease or other instrument
or obligation to which it is a party or by which its properties may
be bound or affected, except, in the case of clauses (ii) or
(iii) above, for any such conflicts, violations, defaults or
other occurrences, if any, that could not, individually or in the
aggregate, reasonably be expected to impair the ability of the
Parties to consummate the Transaction on a timely basis.
(d) No consent, approval, order or
authorization of, or registration, declaration or filing with, any
Governmental Authority is required by or with respect to Issuer in
connection with the execution and delivery of this Agreement or the
consummation of the Transaction or other transactions contemplated
hereby except for: (i) the Required Issuer Vote; (ii) the
filing of
12
the Registration Statement and its declaration
of effectiveness by the SEC; (iii) the filing of the
certificate of merger in Delaware in respect of the Issuer
Subsidiary Merger; (iv) filings and consents in respect of the
listing of the Shares to be issued in connection with the
Transaction; and (ii) such consents, approvals, orders or
authorizations, or registrations, declarations or filings which, if
not obtained or made, could not reasonably be expected to impair
the ability of the Parties to consummate the Transaction on a
timely basis.
4.4 Issuer Prospectus . The
Prospectus filed by Issuer with the SEC on June 5, 2006
(i) at the time filed complied as to form in all material
respects with the applicable requirements of the Securities Act
and/or the Exchange Act, as the case may be and (ii) did not
at the time it was filed nor, except as set forth in a disclosure
schedule hereto or in filings with the SEC subsequent to that date,
would it if dated and delivered on the date hereof, contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make
the statements contained therein, in the light of the circumstances
under which they were made, not misleading.
4.5 Compliance with Exchange
Act . Subsequent to June 5, 2006, the Issuer has complied
in all material respects with the applicable requirements of the
Securities Act and/or Exchange Act, as the case may be, and any
filings from and after such date and prior to the date hereof did
not, at the time it was filed, contain any untrue statement of a
material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements
contained therein, in the light of the circumstances under which
they were made, not misleading.
4.6 Organization, qualification,
subsidiaries, capital structure . The information contained in
the Issuer Prospectus plus any documents filed subsequently in
accordance with the Securities Act and the Exchange Act, taken as a
whole, comparable to the information concerning the Company and its
Subsidiaries in Sections 2.1, 2.2 and 2.3 is true and
correct.
4.7 Agreements, Contracts and
Commitments .
(a) Olivier Carli has been provided
via the Issuer filings with the SEC or the Issuer electronic
data-base with copies of all contracts entered into by the Issuer
or its Subsidiaries that come within the definition of
“Material Contracts” under Item 601(b)(10) of
Regulation S-K promulgated under the Securities Act (the “
Issuer Material Contracts ”).
(b) Each Issuer Material
Contract is valid and binding on the respective parties
thereto and is in full force and effect. Neither the Issuer nor any
of its Subsidiaries is in breach of, or default under, any Issuer
Material Contract.
4.8 Merger Sub . From the
date of incorporation of Merger Sub to the Closing, Issuer will own
beneficially of record all the outstanding capital stock of Merger
Sub. Merger Sub will be formed solely for the purpose of engaging
in the Issuer Transactions and will engage in no other business
activities and will conduct its operations only as contemplated
hereby.
13
ARTICLE V
CONDUCT OF BUSINESS PENDING THE
TRANSACTION
5.1 Conduct of Business Pending
the Transaction .
(a) Olivier Carli covenants and
agrees that, between the date hereof and the earlier to occur of
the Closing or such earlier time as this Agreement is terminated in
accordance with ARTICLE VIII (such period being hereinafter
referred to as the “ Interim Period ”), except
as expressly required by this Agreement, or as required by
applicable or unless Issuer shall otherwise consent in writing,
which consent shall not be unreasonably withheld, conditioned or
delayed, shall cause Scient’x and its Subsidiaries:
(i) to conduct its business only in the ordinary course of
business, consistent with past practice and according to the
revised budget set forth in the Company Disclosure Schedule,
provided however appropriate financing is authorized by Luxco;
(ii) not to take any action, or fail to take any action,
except in the ordinary course of business, consistent with past
practice; and (iii) to use its commercially reasonable efforts
to preserve intact its business organization and preserve the
relationship with customers, licensees, suppliers and other Persons
with which it has business or employment relations. By way of
amplification and not limitation, except as expressly permitted by
this Agreement, Olivier Carli shall cause the Company,
Scient’x and the Subsidiaries of Scient’x, during the
Interim Period, not to directly or indirectly, do any of the
following without the prior written consent of Issuer, which
consent shall not be unreasonably withheld, conditioned or
delayed:
(i) amend its Certificate of
Incorporation, Bylaws or other equivalent organizational documents,
or otherwise alter their corporate structure through merger,
liquidation, reorganization, restructuring or otherwise;
(ii) issue, sell, transfer, pledge,
dispose of or encumber any shares of capital stock of any class, or
any options, warrants, convertible securities or other rights of
any kind to acquire any shares of capital stock, or any other
ownership interest of the Company, Scient’x or any of the
Subsidiaries of Scient’x;
(iii) redeem, repurchase or
otherwise acquire, directly or indirectly, any shares of capital
stock of the Company or interest in or securities of any of
Scient’x and its Subsidiaries;
(iv) sell, transfer, pledge, dispose
of or encumber any properties, facilities, equipment or other
assets of Scient’x and its Subsidiaries, except for sales of
inventory and equipment in the ordinary course of
business;
(v) declare, set aside or pay any
dividend or other distribution (whether in cash, stock or other
securities or property, or any combination thereof) in respect of
any of its capital stock or other equity interests of
Scient’x and the Company;
(vi) split, combine or reclassify
any shares of Scient’x and the Company’s capital stock
or other securities or equity interests, or issue any other
securities in respect of, in lieu of or in substitution for shares
of its capital stock or equity interests;
14
(vii) sell, transfer, lease,
license, sublicense, mortgage, pledge, dispose of, encumber, grant
or otherwise dispose of any Intellectual Property, or amend or
modify any existing agreements with respect to any Intellectual
Property of Scient’x and its Subsidiaries;
(viii) acquire (by merger,
consolidation, acquisition of stock or assets or otherwise) any
corporation, limited liability company, partnership, joint venture
or other business organization or division thereof;
(ix) incur any indebtedness for
borrowed money or issue any debt securities or assume, guarantee or
endorse or otherwise as an accommodation become responsible for the
obligations of any Person, or make any loans, advances or enter
into any financial commitments, except (i) in the ordinary
course of business and (ii) as otherwise permitted under any
loan or credit agreement to which the Company or any of its
Subsidiaries is a party as of the date of this Agreement, or as
provided in the revised budget set forth in the Company Disclosure
Schedule;
(x) authorize any capital
expenditures of Scient’x or any of its Subsidiaries in excess
of €50,000 in the aggregate;
(xi) take or permit to be taken any
action by Scient’x or any of its Subsidiaries to:
(A) increase the compensation payable to its officers or
employees, except for increases in salary or wages in accordance
with agreements entered into prior to the date of this Agreement or
otherwise in the ordinary course of business consistent with past
practice; (B) grant any additional severance or termination
pay to, or enter into any employment or severance agreements with,
its officers; (C) grant any severance or termination pay to,
or enter into any employment or severance agreement with, any
employee except in accordance with agreements entered into before
the date of this Agreement or otherwise in the ordinary course of
business consistent with past practice; (D) enter into any
collective bargaining agreement; or (E) establish, adopt,
enter into or amend any bonus, profit sharing, thrift,
compensation, stock option, restricted stock, pension, retirement,
deferred compensation, employment, termination, severance or other
plan, trust, fund, policy or arrangement for the benefit of any of
its directors, officers or employees;
(xii) change any accounting policies
or procedures (including, without limitation, procedures with
respect to reserves, revenue recognition, payments of accounts
payable and collection of accounts receivable), unless required by
statutory accounting principles or applicable GAAP;
(xiii) create, incur, suffer to
exist or assume any Lien on any of the properties, facilities or
other assets , except assets that will be transferred pursuant to
the Asset Transfer;
(xiv) other than in the ordinary
course of business: (A) enter into any Scient’x Material
Contract; (B) modify, amend, transfer or terminate any
Scient’x Material Contract or waive, release or assign any
rights or claims thereto or thereunder; or (C) enter into or
extend any lease with respect to real property of Scient’x or
any of its Subsidiaries;
(xv) enter into any material
agreement, or amend the terms of any existing material agreement of
Scient’x or any of its Subsidiaries, which grants to any
Person exclusive supply, manufacturing, production, marketing or
distribution rights with respect to any of its products or
technologies;
15
(xvi) make any Tax election or
settle or compromise any federal, state, local or foreign Tax
liability, or agree to an extension of
