EXECUTION COPY
ASSET PURCHASE AGREEMENT
By and Between
TYCO HEALTHCARE GROUP LP
and
SHERWOOD SERVICES, AG, as Seller,
And
INTEGRA LIFESCIENCES CORPORATION
and INTEGRA LIFESCIENCES (IRELAND) LIMITED, as Buyer,
Dated as of September 7, 2005
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TABLE OF CONTENTS
Page
Article 1. SALE AND PURCHASE OF
ASSETS.......................................2
1.1 Purchased
Assets...........................................2
1.2 Excluded
Assets............................................6
Article 2. PURCHASE PRICE; PURCHASE PRICE
ADJUSTMENT.........................9
2.1 Purchase
Price.............................................9
2.2 Allocation
and Payment of the Initial Purchase Price.......9
2.3 Purchase
Price Adjustment.................................11
2.4 Transfer
Taxes and Value Added Taxes......................13
2.5 Transfer
of Patent Files..................................14
Article 3. ASSUMPTION OF LIABILITIES AND
OBLIGATIONS BY PURCHASER...........15
3.1 Assumed
Liabilities.......................................15
3.2 Certain
Excluded Liabilities..............................15
3.3
Nonassignable Contracts and Authorizations................20
Article 4. REPRESENTATIONS AND WARRANTIES
OF SELLER.........................20
4.1 Representations and
Warranties of Seller..................20
4.1.1
Organization and Standing........................20
4.1.2
Title to Purchased Assets; Condition of
Purchased Assets.................................21
4.1.3 No
Conflict......................................23
4.1.4
Financial Statements and Information.............24
4.1.5
Insurance........................................25
4.1.6
Litigation.......................................25
4.1.7
Licenses and Permits; Compliance with Laws.......26
4.1.8
Taxes.
........................................27
4.1.9
Brokers; Finders.................................28
4.1.10 Absence
of Certain Changes.......................29
4.1.11 Real
Properties..................................32
4.1.12 Material
Contracts...............................34
4.1.13
Intellectual Property Rights.....................37
4.1.14 No
Consent Requirements..........................38
4.1.15
Authorization....................................38
4.1.16 Employee
Benefit Plans; Employment Agreement.....39
4.1.17 Personal
Property................................41
4.1.18
Inventory........................................42
4.1.19 Product
Warranty.................................42
4.1.20
Environmental Matters............................43
4.1.21 Powers of
Attorney...............................44
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4.1.22
Undisclosed Liabilities..........................44
4.1.23 Labor
Matters....................................44
4.1.24 Certain
Relationships............................45
4.1.25 Export
........................................46
4.1.26
Certifications; Product Safety...................46
4.1.27 Product
Liability Claims.........................47
4.1.28 Transfer
of Production...........................48
4.1.29 Selling
Affiliate Transfer of Assets.............48
4.1.30
Transitional Supply Agreement Products...........48
4.1.31
Maintenance of Molds, Tools & Dies...............48
4.1.32 No Other
Representations and Warranties..........49
Article 5. REPRESENTATIONS AND WARRANTIES
OF PURCHASER......................49
5.1
Representations and Warranties............................49
5.1.1
Organization and Standing........................49
5.1.2
Authorization....................................50
5.1.3 No
Conflict......................................50
5.1.4
Litigation.......................................51
5.1.5
Brokers; Finders.................................52
5.1.6
Consent Requirements.............................52
5.1.7
Financing........................................52
Article 6. COVENANTS AND
AGREEMENTS.........................................52
6.1 Employee
Matters..........................................52
6.2
Commercially Reasonable Efforts to Close..................56
6.3 Press
Release; Disclosures................................58
6.4 Books and
Records and Information.........................59
6.5 Litigation
Support........................................61
6.6
Transition................................................62
6.7 Covenant
Not to Compete...................................63
6.8 Tax
Matters...............................................65
6.9 Seller's
Tradename and Trademarks.........................68
6.10
Financial Statements and Information......................69
6.11
Exclusivity...............................................72
6.12
Updated Schedules.........................................72
6.13
Auditor's Consent and Cooperation.........................72
6.14
Intellectual Property of Seller...........................73
6.15
Intellectual Property of Purchaser........................75
6.16
Customer Complaints.......................................75
6.17
Customer Inquiries........................................76
6.18
Assignment of
Material Contracts..........................76
6.19
Selling Affiliates Transfer Agreement.....................76
6.20
[Reserved.]...............................................77
6.21
Compatibility.............................................77
6.22
Treatment of Certain Contracts............................77
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6.23
Consent to Assignment of the BPCS License.................78
6.24
Notice of Transfer of Products............................79
6.25
Enforcement of Non-Competition Agreements.................79
6.26
Transfer of Demonstration Units...........................79
6.27
CUSA Production Levels....................................79
6.28
Notice of Transfer of Production..........................80
Article 7. CONDUCT OF BUSINESS PENDING
CLOSING..............................80
7.1 Conduct of
Business Pending Closing.......................80
7.2 Notice of
Developments....................................82
Article 8. CLOSING DATE; CONDITIONS AND
TRANSACTIONS........................82
8.1 Closing
Date and Place....................................82
8.2 Conditions
Precedent to the Obligations of Purchaser......82
8.3 Conditions
Precedent to the Obligations of Seller.........86
Article 9
TERMINATION.......................................................88
9.1
Termination of this Agreement.............................88
Article 10
INDEMNIFICATION..................................................89
10.1
Indemnification by Seller.................................89
10.2
Indemnification by Purchaser..............................90
10.3
Survival of Representations and Warranties................91
10.4
Indemnification Procedure.................................92
10.5
Notice and Opportunity to Defend..........................94
10.6
Reduction for Insurance and Other Claims..................96
10.7
Limitations of Remedies...................................97
10.8
Purchase Price Adjustment.................................97
Article 11.
MISCELLANEOUS...................................................98
11.1
Expenses..................................................98
11.2
Notices...................................................98
11.3
Counterparts..............................................99
11.4
Entire Agreement.........................................100
11.5
Headings.................................................100
11.6
Assignment and Amendment of Agreement....................100
11.7
Governing Law............................................100
11.8
Failure to Close.........................................101
11.9
Further Assurances.......................................101
11.10 No
Third Party Rights....................................101
11.11
Waiver of Bulk Sales Laws................................102
11.12
Non-Waiver...............................................102
11.13
Severability.............................................102
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11.14
Incorporation of Schedules...............................102
11.15
Waiver of Jury Trial.....................................102
Article 12. DEFINED
TERMS..................................................103
12.1
Definitions..............................................103
12.2
Other Definitions........................................104
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EXHIBITS AND SCHEDULES
Exhibits
Exhibit A
Medical Instruments and Product Lines of Seller
Exhibit B
Form of Selling Affiliate Transfer Agreement
Exhibit C
Press Release
Exhibit D
Form of Letter to Counterparties to Service Agreements
Exhibit E
Bill of Sale
Exhibit F
Transition Services Agreement
Exhibit G
Transitional Supply Agreement
Exhibit H
Term Sheet for International Distribution Agreement
Disclosure Schedules
Schedule 1.1
Seller's Affiliates and International Inventory
Location
Schedule 1.1(e)
Personal Property
Schedule 1.2(e)
Excluded Contracts
Schedule 1.2(j)
Excluded Trademarks and Trade Names
Schedule 1.2(m)
Exceptions to Licenses and Permits
Schedule 1.2(o)
Excluded Personal Property Leases
Schedule 2.1
2004 Audited Financial Statements
Schedule 2.2(a)
Initial Purchase Price Allocation
Schedule 2.3(a)
Closing Inventory Accounting Instructions
Schedule 3.1(c)
Assumed Employment Agreements
Schedule 4.1.2(b)(i)
Current Patents, Trademarks and Applications
Schedule 4.1.2(b)(vii) Material
Licenses and Permits
Schedule 4.1.2(b)(viii) Real Property
Leases
Schedule 4.1.3
Exceptions to No Conflict
Schedule 4.1.4(a)
2004 Audited Financial Statements
Schedule 4.1.4(b)
Financial Information
Schedule 4.1.5
Insurance Policies
Schedule 4.1.5(a)
Exceptions to Legal, Valid and Enforceable
Insurance Policies
Schedule 4.1.6
Litigation
Schedule 4.1.7(a)(i)
Exceptions to Licenses and Permits
Schedule 4.1.7(b)
Non-Compliance with Legal Requirements
Schedule 4.1.10(i)
Absence of Certain Changes
Schedule 4.1.10(ii)
Certain Expenditures
Schedule 4.1.10(m)
Employment Contracts
Schedule 4.1.10(o)
Changes to Employee Plans
Schedule 4.1.11(a)
Liens on Real Property Leases
Schedule 4.1.11(b)
Disclosure Regarding Real Property Leases
Schedule 4.1.12(a)
Material Contracts
Schedule 4.1.12(b)
Defaults on Material Contracts
Schedule 4.1.12(c)
Material Contracts Requiring Authorization, Consent
or Approval to Sell, Assign,
Transfer, Convey and Deliver
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Schedule 4.1.12(d)
Material Contracts with International Customers
Schedule 4.1.12(e)
Confidentiality Agreements
Schedule 4.1.13(i)
Intellectual Property Infringement
Schedule 4.1.13(ii)
Abandoned or Expired Patents
Schedule 4.1.13(iii)
Expired or Abandoned Trademarks and Pending
Applications for Trademarks
Schedule 4.1.16(a)
Material Employee Benefit Plans and Fringe Benefit
Plans
Schedule 4.1.16(h)
Foreign Plans
Schedule 4.1.17(i)
Exceptions to Good Title to Personal Property
Schedule 4.1.17(ii)
Disclosure Regarding Operating Conditions of
Personal Property
Schedule 4.1.18
Addresses At Which Inventory Is Located
Schedule 4.1.20(b)
Non-Compliance with Environmental Laws
Schedule 4.1.20(c)
Releases of Hazardous Substances
Schedule 4.1.20(d)
Environmental
Claims
Schedule 4.1.21
Powers of Attorney
Schedule 4.1.23(a)
Labor Disputes
Schedule 4.1.23(b)
Non-Compliance with Employment Laws
Schedule 4.1.26
Notifications Regarding Product Safety
Schedule 4.1.27
Product Liability Claims
Schedule 5.1.3
Exceptions to Purchaser's No Conflict
Schedule 5.1.4
Purchaser Litigation
Schedule 5.1.6
Required Consents
Schedule 6.1.1(i)
Business Employees
Schedule 6.1.1(ii)
List of Employees Terminated from 22 Terry Avenue,
Burlington, Massachusetts Facility
Schedule 6.1.2
Accrued Employee Paid Time Off
Schedule 6.1.4
Certain Severance Benefits
Schedule 6.1.6
Annual Bonuses of Transferred Employees
Schedule 6.14
Product Design Changes
Schedule 6.15
Patents Not Subject to Infringement Suits by
Purchaser
Schedule 6.22.2
Customer Contracts
Schedule 8.2.6(c)(i)
Acknowledgement of Patent Assignment
Schedule 8.2.6(c)(ii)
Acknowledgement of Patent Assignment
Schedule 8.2.6(c)(iii)
Acknowledgement of Trademark Assignment
Schedule 8.2.6(d)
Information Delivered to Purchaser at Closing
Schedule 8.2.6(e)
Estoppel Certificate and Consent to Assignment of
Lease
Schedule 8.2.6(f)
Agreements to be Amended
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (this "Agreement"), dated as of
September
7, 2005, by and between Tyco Healthcare
Group LP, a Delaware limited partnership
("Tyco Healthcare"), Sherwood Services, AG,
a company organized under the laws
of Switzerland (Tyco Healthcare and
Sherwood Services AG are collectively
referred to herein as "Seller"), and
Integra LifeSciences Corporation, a
Delaware corporation, and Integra
LifeSciences (Ireland) Limited, a company
organized under the laws of Ireland
(Integra LifeSciences Corporation and
Integra LifeSciences (Ireland) Limited are
collectively referred to herein as
"Purchaser").
W I T N E S S E T H:
WHEREAS, Seller is engaged in the design, manufacture, marketing
and
distribution of the medical instruments and
product lines set forth in Exhibit A
attached hereto (the "Business") (such
medical instruments and product lines,
the "Products");
WHEREAS, Seller wishes to sell and transfer to Purchaser the
assets,
properties and business of the Business,
including, but not limited to,
inventories of Products and certain other
assets held by certain of its
international Affiliates, pursuant to and
in accordance with the terms and
conditions of this Agreement; and
WHEREAS, Purchaser wishes to acquire the assets, properties and
business of the Business, and to assume
certain liabilities of Seller relating
to the Business, pursuant to and in
accordance with the terms and conditions of
this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein setforth,
the parties hereto hereby agree as
follows:
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ARTICLE 1.
SALE AND PURCHASE OF ASSETS
1.1 Purchased
Assets.
Subject to the terms, conditions and
exclusions set forth in this Agreement,
Seller will, or will cause those Affiliates
set forth on Schedule 1.1, attached
hereto and made a part hereof (the "Selling
Affiliates"), to, sell, assign,
transfer, convey and deliver to Purchaser
free and clear of all Liens (other
than Permitted Liens), and Purchaser will
purchase, acquire and accept from
Seller and the Selling Affiliates, all of
the following assets, properties,
rights and business used in and relating to
the Business, free and clear of all
Liens as of the Closing Date (other than
Permitted Liens) (collectively, the
"Purchased Assets"):
(a) all United
States and foreign patents, patent applications, licenses,
trademarks (whether registered or
unregistered), service marks, trade names,
service names, brand names, Internet domain
names and all related content
(except for any intellectual property not
transferred to the Purchaser) and
telephone numbers, to the extent
collectively set forth on Schedule 4.1.2(b)(i)
and Schedule 4.1.12(a), attached hereto and
made a part hereof, and logos,
product drawings, trade dress, copyrights
and any applications and registrations
therefor, and any other intangible property
rights, including, without
limitation, proprietary know-how,
inventions, discoveries and improvements, shop
rights, formulae, trade secrets, product
drawings, specifications, designs and
other proprietary and/or confidential
information owned by Seller and used in
the Business and all of the goodwill
associated with the foregoing, provided,
however, that any such intangible property
rights that are not solely used in
the Business shall be conveyed to Purchaser
by Seller through a non-exclusive
irrevocable worldwide license only
(collectively, "Seller's Intellectual
Property Rights");
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(b) all of
Seller's and the Selling Affiliates' inventories relating to
and
used in the Business, including, without
limitation, finished goods (including
packaging material and promotional
materials such as samples, demos, loaners and
prototypes), work-in-progress, raw
materials, supplies, manufactured and
purchased parts and other materials to the
extent reflected on the 2004 Audited
Financial Statements (the "Audited
Inventory"), plus any inventories relating to
the Business acquired by Seller or the
Selling Affiliates in the ordinary course
of business after September 30, 2004, less
any inventories relating to the
Business sold or otherwise disposed of by
the Seller or the Selling Affiliates
in the ordinary course of business after
September 30, 2004 and less the
inventory related to the Business located
at the Seller's Boulder, Colorado and
Tijuana, Mexico facilities on the Closing
Date (collectively, but in each case,
wherever located and however recorded, the
"Inventory");
(c) all business
records (including records related to quality assurance,
quality system procedures, device master
records, policies, orders, complaints
and related records), books, ledgers, lists
(including lists of suppliers,
vendors, current and past customers, and
any list of prospective customers),
studies, reports, models, tracings, price
sheets, films, slides, art work and
printing plates, advertising and
promotional materials and other creative
materials, tool drawings, plans, designs,
blueprints or architectural plans,
schematic drawings, engineering data,
computer software (object code and, to the
extent transferable, source code) data and
the like in the possession of Seller
or the Selling Affiliates, relating to and
used by the Business, including,
without limitation: all regulatory filings
and submissions to, all clearances
and approvals from and all correspondence
with the Food and Drug Administration
("FDA"), the Center for Medicare Services,
the Office of the Inspector General
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of the Department of Health and Human
Services and the Justice Department and
all comparable foreign bodies with
regulatory authority (if and insofar as the
same may be transferred to Purchaser in
accordance with applicable law),
customer files (including past, present and
prospective customers),
correspondence with customers and account
histories, complaint files, sales
literature and promotional or other
material pertaining to products, services or
techniques designed, manufactured or sold
by or for the Business, material
relating to the purchase of materials,
supplies and services, research and
commercial data, records relating to the
Transferred Employees of the Business
(to the extent permitted by law),
consultants and contractors, credit
information, catalogs, brochures and
training and other manuals, copyright
application files, invention disclosures,
laboratory notebooks, confidentiality
agreements, patent opinion letters from
counsel regarding the patent rights of
other parties, trademark opinion letters
from counsel regarding the trademark
rights of other parties, patent search
reports and opinions and trademark search
reports and opinions (collectively, the
"Books and Records");
(d) all of Seller's
rights and interests under all contracts and
commitments, other than Excluded Contracts,
entered into, accepted, made or
submitted by or on behalf of the Business
for the benefit of the Business
(whether entered into by Seller before or
after the date of this Agreement),
including, without limitation, contracts
for the sale of goods or services and
any unfilled purchase orders issued by or
on behalf of the Business
(collectively, the "Assumed
Contracts");
(e) all of the
tangible personal property used in the conduct of the
Business and set forth in Schedule 1.1(e)
attached hereto and made a part
hereof, which schedule also identifies the
physical location of such assets as
of the date of this Agreement
(collectively, the "Personal Property");
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(f) all of
Seller's rights and interests under all leases or subleases or
other contracts and other agreements under
which Seller is a lessee of, or holds
or operates, any Personal Property owned by
a third party and relating to or
used in the conduct of the Business
(collectively, the "Personal Property
Leases");
(g) only to the
extent that the same may be transferred to Purchaser in
accordance with applicable law, all
franchises, approvals, permits, licenses,
orders, qualifications, registrations,
certificates (other than certifications
of manufacturing operations held by Tyco
Healthcare or its Affiliates and
directly associated with its manufacture of
products at its Boulder, Colorado or
Tijuana, Mexico facilities) variances and
similar licenses and license
applications, permits and other
governmental authorizations and approvals
(international, federal, state and local)
relating to and used in the Business
(including, without limitation, any
licenses, certifications or permits issued
by any agency of any government necessary
to sell the products of the Business
in any jurisdiction where such products
have been sold during the past three
years) (collectively, the "Licenses and
Permits");
(h) all rights
and interests of Seller in and to certain real property
leases and subleases and all improvements,
fixtures and filings thereon, and
easements and rights-of-way, and other
appurtenants thereto relating to and used
in the Business, and applicable to
occupancy and use of the premises located,
respectively, at 22 Terry Avenue,
Burlington, Massachusetts, 21 Terry Avenue,
Burlington, Massachusetts and 207-D
Cambridge Street, Burlington, Massachusetts,
U.S.A. (the "Real Property Leases");
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(i) all of
Seller's causes of action, choses in actions, rights of
recovery, rights of setoff and rights of
recoupment, vendor, supplier and
similar claims, deposits, prepayments,
refunds, judgments, claims and demands of
whatever nature to the extent relating to
the Purchased Assets, the Assumed
Liabilities or the Business, including any
claims for past infringement or
misappropriation of Seller's Intellectual
Property Rights (collectively,
"Seller's Claims"); (j) all of Seller's
rights and interest under all
confidentiality agreements entered into by
Seller in connection with the sale of
the Business; and
(k) other than
Excluded Assets, all of Seller's rights and interests in and
to all prepaid items and deferred items or
credits and deposits with respect to
the Purchased Assets described in clauses
(a) through (j) above (collectively
"Seller's Credits").
1.2 Excluded
Assets.
Notwithstanding anything herein to the
contrary, the Purchased Assets
transferred, conveyed, set over, assigned
and delivered to Purchaser shall
exclude the assets relating to or used in
the Business set forth below in this
Section 1.2 (the "Excluded Assets"):
(a) All
casualty, liability and individual life insurance policies owned
or
obtained by Seller on behalf of the
Business;
(b) the
corporate minute books and stock registers of Seller;
(c) the income
tax records covering transactions of Seller occurring prior
to the Closing Date and any Tax refunds of
Seller other than Tax refunds
attributable to or relating to Purchaser's
ownership of the Purchased Assets
after the Closing Date;
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(d) the
personnel records (including, without limitation, all human
resources and other records) of Seller
relating to all employees of Seller other
than Transferred Employees and personnel
records of Transferred Employees that
are not Purchased Assets because such
personnel records are prohibited by law
from being transferred;
(e) all of
Seller's rights and interests in and to the contracts and
commitments specified in Schedule 1.2(e)
attached hereto and made a part hereof
(collectively, the "Excluded
Contracts");
(f) all cash,
cash equivalents (including restricted cash) and other short
term investments of Seller and any person
or entity directly or indirectly
controlling, controlled by, or under common
control (any such person or entity,
an "Affiliate") with the Seller;
(g) claims,
counterclaims, offsets, defenses or causes of action arising
prior to the Closing Date, other than to
the extent relating to or arising from
the Purchased Assets, the Assumed
Liabilities or the Business;
(h) all rights
and interests of the Seller and its Affiliates in and to all
properties, assets and rights not being
transferred pursuant to Section 1.1
hereof;
(i) all of
Seller's rights and interests in and to all correspondence and
documents in connection with the sale of
the Business (other than the
confidentiality agreements being assumed by
Purchaser pursuant to Section 1.1
(j) and other
correspondence related to the intellectual property business
records of paragraph 1.1(c), in particular,
but not limited to, correspondence
related to applying for and obtaining
patents, trademarks and copyrights and
opinion letters of counsel related to
intellectual property);
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(j) any and all
rights with respect to those of Seller's trademarks and
trade names used in the Business and listed
in Schedule 1.2(j) attached hereto
and made a part hereof;
(k) all of
Seller's rights and interests in all information, files,
records, data, plans, contracts and
recorded knowledge related to or used in
connection with the Business to the extent
that any of the foregoing (i) relate
solely to the Excluded Assets; or (ii)
relate to the Excluded Assets and can be
easily separated from the Purchased Assets
and are privileged or are otherwise
subject to third party privacy rights,
including materials that are protected by
the attorney-client privilege or attorney
work product doctrine, but only to the
extent such do not relate to the Purchased
Assets; or (iii) are solely written
materials that Seller is required by law to
retain and of which Seller shall
have provided a copy to Purchaser
(collectively, "Excluded Records"); and
(l) all of
Seller's accounts receivable and notes receivable, including,
without limitation, accounts receivable and
notes receivable from any Affiliate
of Seller arising under the Assumed
Contracts outstanding on the Closing Date
(the "Accounts Receivable");
(m) all Licenses
and Permits issued by any governmental authority outside
of the United States, to the extent that
such Licenses and Permits are not
solely related to the Business, Products or
Purchased Assets, and only to the
extent set forth on Schedule 1.2(m)
attached hereto and made a part hereof;
(n) all Licenses
and Permits issued by any governmental authority within
the United States, which relate to
manufacture of the Products by Tyco
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Healthcare at locations other than the
Burlington, Massachusetts facility and
are not used primarily in, or necessary to
operate, the Business; and
(o) Personal
Property Leases to the extent set forth on Schedule 1.2(o).
ARTICLE 2. PURCHASE PRICE; PURCHASE PRICE ADJUSTMENT.
2.1 Purchase
Price.
The total purchase price for the Purchased
Assets (the "Purchase Price") shall
be equal to the Initial Purchase Price as
adjusted by the cumulative value of
the adjustments set forth in Section 2.3(e)
(the "Post-Closing Adjustment
Amount"). The sum of eighty million dollars
($80,000,000) less (i) the
estimates (based on the month end
immediately preceding the Closing) of the
provision for sales returns and allowances,
including rebates and product
returns, the provision for product warranty
claims, and the amount of deferred
revenues, each as of the Closing Date,
which estimates shall be provided by Tyco
Healthcare to Purchaser fifteen (15) days
prior to Closing and which shall be
calculated in the same manner as such
provisions and amounts were calculated in
the 2004 Audited Financial Statements, as
set forth on Schedule 2.1, less
(ii) $2,128,279, which represents the value
of the inventory of the Business
located in Tijuana, Mexico and Boulder,
Colorado (the "Supply Inventory"), as
reflected in the 2004 Audited Financial
Statements (the "Estimated Supply
Inventory"), less (iii) $1,200,000 (the
"Initial Purchase Price") shall be
delivered at the Closing.
2.2 Allocation
and Payment of the Initial Purchase Price.
(a) The Initial
Purchase Price shall be allocated to the Purchased Assets
as follows: (i) to inventory and other
tangible property based on their net book
values as of the Closing Date and (ii) to
intangible assets, including, but not
limited to, intellectual property and
goodwill, as determined by the parties
prior to the Closing Date. If the parties
are unable to reach a mutual
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agreement as to the Initial Purchase Price
allocation, then Seller and Purchaser
shall jointly select a qualified partner
(with fifteen (15) or more years of
accounting experience) of either Ernst
& Young or KPMG LLP (the "Accounting
Expert"), who, acting as an expert and not
as an arbitrator, shall, prior to the
Closing Date, resolve those matters still
in dispute with respect to the
allocation of the Initial Purchase Price
among the asset categories. The fees
and expenses of the Accounting Expert will
be borne equally by Purchaser and
Seller. The Initial Purchase Price
allocation determined pursuant to this
Section 2.2(a) shall be set forth by the
parties in Schedule 2.2(a) at Closing
and shall be revised after the Closing Date
to reflect the values of the
Inventory and Closing Supply Inventory and
any other subsequent adjustments to
the Purchase Price.
(b) At the
Closing, Purchaser shall pay the Initial Purchase Price as
follows: (i) to Tyco Healthcare in an
amount equal to the net book value of the
fixed assets and inventory sold by Tyco
Healthcare; (ii) to each Selling
Affiliate in an amount equal to the net
book value of the inventory sold by such
Selling Affiliate; and (iii) the remainder
to Sherwood Services AG and to Tyco
Healthcare for intangible property, such
amount to be paid to Sherwood Services
AG and to Tyco Healthcare in proportion to
the value of the rights owned by (A)
Sherwood Services AG with respect to
non-U.S. intangible property or non-U.S.
rights to intangible property, and (B) Tyco
Healthcare with respect to U.S.
intangible property or U.S. rights to
intangible property. For purposes of
clause (iii), the parties anticipate that
the proportionate values of such
intangible property rights shall be
approximately 45% Sherwood Services AG and
55% Tyco Healthcare.
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2.3 Purchase
Price Adjustment.
(a) As soon as
practicable following the Closing Date, but in no event
later than thirty (30) Business Days
following the Closing Date (the "Valuation
Period"), a physical inventory and
accounting of the Inventory and the Supply
Inventory as of the Closing Date (the
"Closing Supply Inventory") shall be made
jointly by Purchaser and Seller, in
accordance with the instructions set forth
on Schedule 2.3(a) and GAAP. The valuation
of the Closing Supply Inventory shall
be calculated in the same manner as the
value of the Supply Inventory was
calculated in the 2004 Audited Financial
Statements.
(b) If at the
end of the Valuation Period Seller and Purchaser shall
disagree as to the valuation of the
Inventory or the Closing Supply Inventory,
the Seller and Purchaser shall each prepare
and provide the other with a written
notice (the "Valuation Objection Notice")
of such good faith objections to the
valuation of the Inventory or the Closing
Supply Inventory, as applicable, which
objection shall be set forth with
reasonable detail in such Valuation Objection
Notice.
(c) Following
receipt of any Valuation Objection Notice, Seller and
Purchaser shall discuss in good faith the
applicable objections set forth
therein for a period of ten (10) business
days thereafter and shall, during such
period, attempt in good faith to resolve
the matter or matters in dispute by
mutual written agreement. If the parties
reach such an agreement, such agreement
shall be confirmed in writing and the
Inventory or the Closing Supply Inventory,
as applicable, shall be revised to reflect
such agreement.
(d) If the
parties are unable to reach a mutual agreement in accordance
with Section 2.3(c) hereof during the ten
(10) business day period referred to
therein, then Seller and Purchaser shall
jointly select an Accounting Expert,
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who, acting as an expert and not as an
arbitrator, shall resolve those matters
still in dispute with respect to the
valuation of the Inventory or the Closing
Supply Inventory. Seller and Purchaser
shall each provide the Accounting Expert
with their respective Valuation Objection
Notices and shall each cooperate with
the Accounting Expert in all commercially
reasonable respects. The Accounting
Expert will not make any adjustment or
changes to items or amounts that are not
included in the Valuation Objection
Notice.
(e) If it is
determined, pursuant to clauses (c) or (d) above, that (i) the
value of the Inventory is less than the
value of the Audited Inventory less the
Estimated Supply Inventory, as defined in
Section 2.1, then Seller shall pay to
Purchaser the amount by which the values
differ; (ii) the value of the Inventory
is greater than the value of the Audited
Inventory less the Estimated Supply
Inventory, then Purchaser shall pay to
Seller the amount by which the values
differ; (iii) the value of the Closing
Supply Inventory is less than the value
of the Estimated Supply Inventory, then
Purchaser shall pay to Seller the amount
by which the value of the Closing Supply
Inventory is less than the Estimated
Supply Inventory; or (iv) the value of the
Closing Supply Inventory is greater
than the value of the Estimated Supply
Inventory, then Seller shall pay to
Purchaser the amount by which the value of
the Closing Supply Inventory is
greater than the Estimated Supply
Inventory. Any Post-Closing Adjustment Amount
shall be paid by wire transfer of
immediately available funds and shall be paid
promptly, but in no event later than five
(5) Business Days following the final
and binding determination of such
Post-Closing Adjustment Amount.
(f) All fees and
expenses of Purchaser relating to the matters described in
Section 2.2(a) or this Section 2.3,
including the preparation and delivery of
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the Inventory valuation shall be borne by
Purchaser, and all fees and expenses
of Seller relating to the matters described
in Section 2.2(a) or this Section
2.3 shall be borne by Seller.
Notwithstanding the foregoing, in the event an
Accounting Expert is retained, as provided
in Section 2.2(a) or Section 2.3(d)
hereof, the fees and expenses of the
Accounting Expert shall be borne equally by
Seller and Purchaser.
2.4 Transfer
Taxes and Value Added Taxes.
(a) Purchaser
shall be solely responsible for all sales, transfer, use,
registration, documentary, stamp, real
estate, recording and similar taxes
(including penalties and interest) assessed
or payable in connection with the
transfer of the Purchased Assets to
Purchaser or in connection with this
Agreement or any transaction contemplated
hereby (collectively, but excluding
any value added Taxes, the "Transfer
Taxes") up to a maximum of $25,000, and
Seller shall be solely responsible for any
Transfer Taxes over $25,000.
Purchaser shall, at its own expense,
properly file on a timely basis all
necessary Tax Returns, reports, forms, and
other documentation with respect to
any Transfer Tax and promptly provide to
Seller evidence of payment of all
Transfer Taxes that are paid by Purchaser.
Seller, each Selling Affiliate and
Purchaser shall cooperate in preparing and
timely filing all such Tax Returns
and Purchaser shall provide Seller with a
copy of all such filed Tax Returns.
(b) All amounts
payable under this Agreement shall be exclusive of value
added taxes or analogous taxes (if any)
(collectively, "VAT") which Purchaser
shall pay, if and to the extent payable
under any applicable VAT law, to the
Seller or a Selling Affiliate at the rate
applicable thereto from time to time.
Such VAT will be paid by Purchaser on or
before the later of the Closing Date or
thirty (30) days after Purchaser has
received from Seller a VAT invoice in form
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and substance reasonably satisfactory to
Purchaser. Seller and each Selling
Affiliate shall cooperate with Purchaser
and produce all necessary or useful
documentation, make all necessary or useful
declarations or omit any avoidable
action reasonably requested by Purchaser
for Purchaser to (i) qualify for an
exemption from VAT or to comply with any
other provision to legally avoid the
payment of VAT and, to the extent VAT
remains payable, (ii) claim input VAT for
any VAT paid by Purchaser. Where
applicable, Seller and each Selling Affiliate
shall provide Purchaser with a VAT invoice
in accordance with the VAT Law
applicable to the transaction. If
applicable, Purchaser shall pay Seller and
each Selling Affiliate any interest,
penalty or surcharge incurred by Seller and
each Selling Affiliate arising from any
nonpayment of applicable VAT payable by
the Purchaser. Seller, each Selling
Affiliate and Purchaser will cooperate to
ensure so far as possible that the proposed
VAT treatment is accepted by the
relevant tax authority, and will produce
all necessary invoices, records and
other documentation for this purpose.
2.5 Transfer
of Patent Files.
Seller shall deliver to Purchaser on the
Closing Date all patent and trademark
files in Seller's custody or control
relating to those patents and trademarks
listed on Schedule 4.1.13(ii). Within
ninety (90) days after the Closing,
Purchaser shall notify any agents used by
Seller for handling such files of the
change of ownership and correspondence
address. Purchaser shall further execute
new or, at Seller's option, revoke existing
powers of attorney relating to such
files as Seller deems necessary.
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ARTICLE 3. ASSUMPTION OF LIABILITIES AND
OBLIGATIONS BY PURCHASER
3.1
Assumed Liabilities.
Except as otherwise provided for herein,
and except as set forth in
Section 3.2 hereof, Purchaser, in addition
to the consideration to be paid
pursuant to Section 2 hereof, shall assume
at the Closing and shall subsequently
pay, honor and discharge when due and
payable in accordance with and subject to
the terms and conditions of the relevant
governing agreements, commitments and
instruments, the following liabilities
(collectively, the "Assumed
Liabilities"):
(a) all
liabilities and obligations of Seller at the Closing Date to
the
extent (i) pertaining to the Assumed
Contracts, Personal Property Leases,
Licenses and Permits and Real Property
Leases and (ii) not yet due as of the
Closing Date;
(b) liabilities
arising under and related to the Worker Adjustment and
Retraining Notification Act of 1988, as
amended (the "WARN Act"), related to the
employment of Transferred Employees
pursuant to Section 6.1 hereof, provided
that Purchaser shall have received an
updated Schedule 6.1.1(ii) as of the
Closing Date;
(c) all
liabilities and obligations of Seller at the Closing Date to
the
extent pertaining to the employment
agreements set forth on Schedule 3.1(c),
attached hereto and made a part hereof;
and
(d) all other
liabilities and obligations arising out of or resulting from
the conduct of the Business, except
Excluded Liabilities, whether occurring
before, after, or on the Closing Date.
3.2 Certain
Excluded Liabilities.
Purchaser shall not assume, pay, perform,
discharge or in any way be liable or
responsible for any of the following debts,
liabilities or obligations
("Excluded Liabilities"):
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(a) any
liability or obligation of Seller or its Affiliates under this
Agreement or on account of any of the
transactions contemplated hereby,
including, without limitation, any
liability or obligation of Seller to
attorneys, accountants, brokers, financial
advisers or others for services
rendered or expenses incurred by or on
behalf of Seller, and all other expenses
associated with the transfer of the
Purchased Assets;
(b) any
liability of Seller or its Affiliates to an Affiliate of
Seller;
(c) except as
otherwise provided in Section 6.1, any wages, salary,
severance, bonuses, commissions, vacation
or holiday pay, post retirement
medical benefits, fringe benefits,
long-term disability benefits, life insurance
benefits, any duties, obligations or
liabilities arising under any employee
benefit plan, policy or practice, whether
defined by Section 3(3) of the
Employee Retirement Income Security Act of
1974, as amended and in effect
("ERISA") or otherwise, or any employment,
retention, or ----- termination
agreement (including any obligation to
indemnify or reimburse an officer,
employee or agent of Seller), relating to
the employees of the Business,
wherever located, any employee benefit plan
or otherwise, or other amounts due
to any employees or former employees of the
Business which accrue on or prior to
the Closing Date;
(d) any
liabilities arising under the WARN Act in connection with those
employees of Seller that are not
Transferred Employees and any other liabilities
related to the Business Employees that are
not Transferred Employees;
(e) except as
otherwise provided in Section 6.1, any of the following
liabilities to or in respect of any
employees or former employees of Seller or
its Affiliates: (i) any liability arising
under any Employment Agreement,
whether or not written, between Seller and
any person, except for any Employment
Agreement included on Schedule 3.1(c), (ii)
any liability under any Employee
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Benefit Plan at any time maintained,
contributed to or required to be
contributed to, by or with respect to
Seller or any Selling Affiliates or under
which Seller or any Selling Affiliates may
incur liability, or any
contributions, benefits or liabilities
therefor, or any liability with respect
to Seller's, or its Affiliates', withdrawal
or partial withdrawal from or
termination of any Employee Benefit Plan,
and, (iii) if and to the extent
arising out of or relating to an occurrence
or event before the Closing Date,
(x) any other liability to or in respect of
any employees or former employees of
Seller, including, but not limited to, any
claim of an unfair labor practice or
under an employee grievance (including any
claims of age, race of sex based
discrimination), if and insofar as the same
is the subject of a complaint filed
with a state, federal or other court or
government agency of competent
jurisdiction against Purchaser or Seller
(or any of their Affiliates) within one
(1) year following the Closing Date, (y)
any liability with respect to a claim
arising under a worker safety, wage or
severance payment, immigration, or other
law governing the terms and conditions of
employment, if and insofar as the same
is the subject of a complaint filed with a
state, federal or other court or
government agency of competent jurisdiction
against Purchaser or Seller (or any
of their Affiliates) within one (1) year
following the Closing Date and (z) any
claim under any state unemployment
compensation or worker's compensation law or
regulation or under any federal or state
employment discrimination law or
regulation, if and insofar as the same is
the subject of a complaint filed with
a state, federal or other court or
government agency of competent jurisdiction
against Purchaser or Seller (or any of
their Affiliates) within one (1) year
following the Closing Date;
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(f) any
liabilities and obligations of Seller or any of its Affiliates
for
any Taxes;
(g) except as
otherwise provided in Section 2.4 hereof, any Tax imposed
upon or incurred by Seller or any of its
Affiliates arising out of or in
connection with the negotiation and
preparation of this Agreement and the
consummation and performance of the
transactions contemplated hereby;
(h) except as
related to the Purchased Assets or the Burlington,
Massachusetts facility, any liabilities and
obligations of Seller or its
Affiliates for Environmental Claims,
violations of Environmental Law, or
Environmental Conditions;
(i) any
liability arising out of any administrative, regulatory or
judicial
action, suit, order, lien, governmental
investigation, proceeding, written
notice of violation from a governmental
authority or written demand, claim or
threat of litigation against Seller or its
Affiliates (each an "Action")
commenced on or pending on or before the
Closing Date, including, without
limitation pending or threatened litigation
involving Dr. Daniel Hocker;
(j) any
liability or obligation to the extent accruing or arising out
of
(i) personal injury, death or damage
suffered by a third party caused by a
defect in the materials or workmanship of a
Product manufactured, shipped and
sold prior to the Closing Date, but only if
and to the extent such liability is
the subject of a complaint filed with a
state, federal or other court of
competent jurisdiction against Purchaser or
Seller (or any of their Affiliates)
within one (1) year following the Closing
Date, and except to the extent such
liability or obligation arises out of or
relates solely to ordinary course
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warranty claims for product repair,
replacement or service; (ii) any rebates not
reflected on the 2004 Audited Financial
Statements or not incurred in the
ordinary course of business since the date
of the 2004 Audited Financial
Statements; and (iii) intellectual property
infringement claims to the extent
relating to sales of Products before the
Closing Date insofar as such claims are
the subject of a complaint filed with a
state, federal or other court or
governmental agency against Purchaser or
Seller (or any of their Affiliates)
within one (1) year following the Closing
Date;
(k)
Notwithstanding the provisions of the preceding subsection 3.2(j),
any
intellectual property claim to the extent
the same is based upon an allegation
that any Product set forth on Exhibit A or
method made, used, offered for sale,
sold, or imported into the United States by
Seller on or prior to the Closing
Date infringes United States Patent No.
5,987,960;
(l) any
liabilities to third parties under an Assumed Contract if and
to
the extent such liabilities arise out of or
relate to a breach by Seller or its
Affiliates of the Assumed Contract;
(m) any
liability or obligation if and to the extent relating to
Excluded
Assets;
(n) any accounts
payable related to the Business if and to the extent the
same accrue for services or goods rendered
to or received by Seller or its
Affiliates prior to the Closing Date;
(o) any
liability or obligation of Tyco Healthcare or its Affiliates
arising from or relating to (i) any
investigation by the Securities and Exchange
Commission, or any other governmental
authority of competent jurisdiction, or
(ii) Tyco Healthcare's, or any Affiliate of
Seller's, participation in the
United Nations oil-for-food program in
Iraq;
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(p) any
liability in excess of $10,000 not reflected in the 2004
Audited
Financial Statements that should have been
reflected in such financial
statements in accordance with GAAP; and
(q) any
liability in excess of $10,000 incurred after September 30,
2004
and prior to the Closing Date that was not
incurred in the ordinary course of
business and consistent with past
practice.
3.3
Nonassignable Contracts and Authorizations.
To the extent that the assignment of any of
the Purchased Assets shall require
the consent of any other party, this
Agreement shall not constitute a contract
to assign the same to the extent that an
attempted assignment would constitute a
breach of any document, agreement or
understanding governing the Purchased
Assets.
ARTICLE 4. REPRESENTATIONS AND WARRANTIES OF SELLER
4.1
Representations and Warranties of Seller.
Seller represents and warrants to Purchaser
that the statements contained in
this Section 4.1 are true and correct as of
the date of this Agreement (except
to the extent such representations and
warranties expressly relate to an
earlier date, in which case such
representation and warranties were true and
current on and as of such earlier
date):
4.1.1 Organization and
Standing.
(a) Tyco
Healthcare is a limited partnership duly organized, validly
existing and in good standing under the
laws of Delaware, and Sherwood Services
AG is a corporate entity duly organized,
validly existing and in good standing
under the laws of Switzerland, and Tyco
Healthcare and Sherwood Services AG each
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have all partnership or corporate power and
authority to own or lease its
properties and to carry on the Business as
presently conducted, to execute and
deliver this Agreement, to consummate the
transactions contemplated hereby and
to perform its obligations hereunder. Tyco
Healthcare is qualified to do
business as a foreign limited partnership,
and Sherwood Services, AG is
qualified to do business as a Swiss
corporation, and each is in good standing in
each of the jurisdictions in which the
nature of the Business as now being
conducted by it or the property owned or
leased by it principally for the
benefit of the Business makes such
qualification, licensing or registration
necessary, except where the failure to be
so qualified would not have a Material
Adverse Effect.
4.1.2 Title to Purchased
Assets; Condition of Purchased Assets.
(a) Seller or a
Selling Affiliate has good and marketable title to, or a
valid leasehold interest in, the Purchased
Assets and, subject to the terms,
conditions and exclusions set forth in this
Agreement, shall on the Closing Date
convey such title and leasehold interest in
the Purchased Assets to Purchaser,
free and clear of all Liens (other than
Permitted Liens).
(b) Subject to
the terms, conditions and exclusions set forth in this
Agreement, the Purchased Assets include,
without limitation:
(i) the Seller's Intellectual Property Rights, including the
patents,
patent applications, trademarks (whether registered or
unregistered)
and trademark applications, telephone numbers and internet
domain
names set forth on Schedule 4.1.2(b)(i) attached hereto and made
a
part hereof;
(ii) the Inventory;
(iii) the Books and Records;
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(iv) the Assumed Contracts, including all of the Material
Contracts
set forth on Schedule 4.1.12(a) attached hereto and made a part
hereof;
(v) the Personal Property as set forth on Schedule 1.1(e)
attached
hereto and made a part hereof;
(vi) the Personal Property Leases, including those Personal
Property
Leases which are Material Contracts;
(vii) the Licenses and Permits, including all of the material
Licenses
and Permits set forth on Schedule 4.1.2(b)(vii) attached hereto
and
made a part hereof;
(viii) the Real Property Leases, all of which are set forth on
Schedule 4.1.2(b)(viii) attached hereto and made a part hereof;
(ix) the Seller's Claims existing as of the Closing Date;
(x) the Seller's Credits existing as of the Closing Date.
(c) Subject to
the terms, conditions and exclusions set forth in this
Agreement and to the Purchaser's right to
close in the absence of all of the
consents listed on Schedule 4.1.12(c), the
Purchased Assets, along with the
rights granted pursuant to the Transition
Services Agreement, the Transitional
Supply Agreement, the International
Distribution Agreement, or any other
agreement entered into by Seller and
Purchaser related to the purchase and sale
of the Purchased Assets, (i) constitute all
of the assets, tangible or
intangible, and rights that are (y)
primarily used in the operation of the
Business as of September 30, 2004 or (z)
necessary to operate the Business in
the manner operated by Seller as of
September 30, 2004 and (ii) are sufficient
for the continued conduct of the Business
in substantially such manner
immediately following the Closing.
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4.1.3 No Conflict.
Except as set forth in Schedule 4.1.3
attached hereto and made a part hereof,
the execution and delivery of this
Agreement does not, and the consummation of
the transactions contemplated hereby will
not (i) conflict with, constitute a
default under or result in the acceleration
of or the creation in any party of
any right to accelerate, terminate, modify
or cancel or require any notice under
any indenture, contract, lease, sublease,
license, loan agreement, note or other
obligation or liability to which Seller or
a Selling Affiliate is a party or by
which it is bound or to which any of the
assets used in the Business (including,
without limitation, the Purchased Assets)
is subject, or result in a default
under or violation of any material
restriction, lien, encumbrance, indenture,
contract, lease, sublease, loan agreement,
note or other obligation or liability
to which it is a party or by which it is
bound or to which any of its assets is
subject or result in the creation of any
lien or encumbrance upon any of said
assets, (ii) conflict with or result in a
breach of or constitute a default
under any provision of the Limited
Partnership Agreement (or other constitutive
documents) of Seller or any Selling
Affiliates, or (iii) violate or result in a
breach of or constitute a default under any
constitution or statute or any
judgment, injunction, order, decree, rule,
regulation or restriction of any
court or governmental agency to which the
Business or the Purchased Assets is
subject, except, in each of clauses (i) -
(iii) above, for such accelerations,
terminations, modifications, cancellations,
defaults, liens, encumbrances or
violations as would not have a Material
Adverse Effect. Except as set forth on
Schedule 4.1.3 attached hereto and made a
part hereof, Seller and the Selling
Affiliates are not required to provide any
notice to, make any filing with, or
obtain any authorization, consent or
approval of any government or governmental
agency to consummate the transactions
contemplated hereby.
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4.1.4 Financial Statements
and Information.
(a) True,
correct and complete copies of the audited combined statement
of
net assets of the Business as of September
30, 2004, and combined statement of
income and cash flows of the Business for
the fiscal year ended September 30,
2004 (the "2004 Audited Financial
Statements") are attached hereto as Schedule
4.1.4(a). The 2004 Audited Financial
Statements (i) have been prepared from and
are in accordance in all material respects
with the financial and accounting
records of Seller relating to the Business;
(ii) have been prepared in
accordance with GAAP; and (iii) fairly
present, in accordance with GAAP, the
financial condition and results of
operations of the Business as of September
30, 2004 and for the periods ended
September 30, 2004.
(b) Seller has
provided Purchaser with the financial information set forth
on Schedule 4.1.4(b) for the quarters ended
December 31, 2004, March 31, 2005
and June 30, 2005 which (i) has been
prepared from and is in accordance in all
material respects with the financial and
accounting records of Seller relating
to the Business; and (ii) has been prepared
in accordance with GAAP consistently
applied to the 2004 Audited Financial
Statements.
(c) The Interim
Period Financial Statements delivered to Purchaser by
Seller pursuant to Section 6.l0 shall: (i)
be prepared from and be in accordance
in all material respects with the financial
and accounting records of Seller
relating to the Business; (ii) be prepared
in accordance with GAAP; and (iii)
fairly present, in accordance with GAAP,
the financial condition and results of
operations of the Business as of the dates
of and for the periods referred to
therein.
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(d) Any 2005
Audited Financial Statements prepared by Seller for Purchaser
pursuant to Section 6.10 shall: (i) be
prepared from and be in accordance in all
material respects with the financial and
accounting records of Seller relating
to the Business; (ii) be prepared in
accordance with GAAP; and (iii) fairly
present, in accordance with GAAP, the
financial condition and results of
operations of the Business as of the dates
of and for the periods referred to
therein.
(e) The net
worth of Tyco Healthcare, determined in accordance with GAAP
after taking into account the transactions
contemplated by this Agreement and
the distribution of the proceeds therefrom,
will be in excess of Eighty Million
Dollars ($80,000,000).
4.1.5 Insurance.
Schedule 4.1.5 attached hereto and made a
part hereof accurately lists the
policies of insurance (including, without
limitation, policies covering
property, casualty, liability, and workers
compensation coverage) covering the
assets and operations of the Business,
including all of the Purchased Assets.
Except as set forth on Schedule 4.1.5(a),
all such policies are legal, valid,
binding, enforceable and subsisting in full
force and effect in accordance with
their terms and each policy will continue
to be legal, valid, binding,
enforceable and subsisting in full force
and effect on identical terms following
the consummation of the transactions
contemplated hereby. Seller has not been
denied insurance or suffered the
cancellation of any insurance with respect to
the Business since Seller acquired the
Business.
4.1.6 Litigation.
(a) Except as
set forth in Schedules 4.1.6 and 4.1.13(i) attached hereto
and made a part hereof, (i) there is no
action, suit, hearing, proceeding,
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arbitration or investigation pending or, to
the knowledge of Seller, threatened
against Seller with respect to the
Business, the Purchased Assets, the Assumed
Liabilities or the transactions
contemplated hereby that would, individually or
in the aggregate have a Material Adverse
Effect on the Business or materially
delay the consummation of the transactions
contemplated hereby, and (ii) there
are no orders, writs, injunctions or
decrees currently in force against Seller
with respect to the conduct of the Business
that would, individually or in the
aggregate, have a Material Adverse Effect
on the Business or that would
materially delay the consummation of the
transactions contemplated hereby.
(b) Seller has
no actual knowledge of any pending or threatened action,
suit, proceeding, hearing or investigation
that would result in a Material
Adverse Effect or materially adversely
affect the transactions contemplated
hereby (except for any such action, suit or
investigation related to any
Antitrust Laws).
4.1.7 Licenses and Permits;
Compliance with Laws.
(a) Except as
set forth in Schedule 4.1.7(a)(i) attached hereto and made a
part hereof, with respect to the Business,
Seller owns, holds or possesses in
its own name, all Licenses and Permits
necessary to entitle it to use its name,
to own or lease, operate and use the assets
and properties used in the conduct
of the Business and its operations as
presently conducted, except for such
Licenses and Permits, the absence of which
would not, individually or in the
aggregate, have a Material Adverse Effect.
Seller is not in violation of or
default under any Licenses and Permits
which violation or default would,
individually or in the aggregate, have a
Material Adverse Effect. Set forth on
Schedule 4.1.2(b)(vii) attached hereto and
made a part hereof is a list of the
Licenses and Permits material to operation
of the Business, including, without
limitation (i) 510(k)'s for each Product,
(ii) corresponding foreign product
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registrations for CE marks and any similar
foreign licenses or permits, (iii)
environmental licenses and permits
applicable to the operation of the
Burlington, Massachusetts facility, and
(iv) ISO and quality certifications.
(b) Except as
set forth in Schedule 4.1.7(b) attached hereto and made a
part hereof, with respect to the Business,
Seller is in compliance with each
Legal Requirement except for such
noncompliance as would not have a Material
Adverse Effect, individually or in the
aggregate. No event has occurred or
circumstance exists that (with or without
notice or lapse of time) (i) may
constitute or result in a violation by
Seller, or a failure on the part of
Seller, to comply with, any Legal
Requirements, or (ii) may give rise to any
obligation on the part of Seller to
undertake, or to bear all or any portion of
the cost of, any remedial action of any
nature, except in each case, for such
violations, obligations or noncompliance as
would not, individually or in the
aggregate, have a Material Adverse Effect.
For the purposes of this Agreement,
"Legal Requirement(s)" means any applicable
federal, state, local, municipal,
foreign, international, multinational or
other administrative order,
constitution, law, ordinance, principal of
common law, regulation, statute,
judgment or treaty.
4.1.8 Taxes.
(a) Definitions.
For purposes of this Agreement:
(i) The term "Tax" means any of the Taxes, and "Taxes" means (A)
all
net income, capital gains, gross income, gross receipts, sales use
ad
valorem, franchise, capital, profits, license, withholding,
employment, social security, payroll, transfer, conveyance,
documentary, stamp, property, value added, customs duties,
minimum
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taxes, estimated and any other taxes, fees, charges, levies,
excises,
duties or assessments of any kind whatsoever, together with
additions
to tax or additional amounts, interest and penalties relating
thereto
that may be imposed by any federal, state, local or foreign
government
or taxing authority (whether payable directly or by withholding
and
whether or not requiring the filing of a Tax Return), and (B)
any
liability for the payment of any amount of any type described
in
clause (A) as a result of a person being a transferee, successor or
a
member of an affiliated, consolidated, unitary or combined group or
of
a contractual obligation to indemnify any person or other
entity;
(ii) "Tax Returns" means all returns, reports, statements and
forms
(including elections, declarations, disclosures, schedules,
estimates
and information tax returns) required to be filed in respect of
any
Tax; and
(iii) "Code" means the Internal Revenue Code of 1986, as
amended,
including the rules and regulations thereunder and any substitute
or
successor provisions.
(b) There are no
liens for Taxes (other than for current Taxes not yet due
and payable) on the Purchased Assets.
(c) Tyco
Healthcare is not a person other than a United States person
within the meaning of Section 7701(a)(30)
of the Code.
(d) None of the
Purchased Assets are required to be treated for Tax
purposes as owned by any other person or
entity other than Seller or the Selling
Affiliates.
4.1.9 Brokers; Finders.
Seller has not retained any broker or
finder in connection with the transactions
contemplated herein and is not obligated
and has not agreed or obligated
Purchaser to pay for any brokerage or
finder's commission, fee or similar
compensation.
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4.1.10 Absence of Certain
Changes.
Except as set forth in Schedule 4.1.10(i)
attached hereto and made a part
hereof, since September 30, 2004 Seller has
conducted the Business in the
ordinary course of business, consistent
with past practices, and since September
30, 2004, there has not been any Material
Adverse Effect in the Business or its
financial condition, operations, or results
of operations. Seller has provided
Purchaser with a copy of the most recent
capital expenditure budget related to
the Business for the fiscal year 2005 (with
actual expenditures through June 30,
2005) and except as set forth on Schedule
4.1.10(ii), Seller has not committed
or expended any capital except in
accordance with the total amount of such
capital expenditure budget. Without
limiting the generality of the foregoing,
since September 30, 2004:
(a) Seller has
not sold, leased, transferred or assigned any of its assets
used in the Business, tangible or
intangible, other than in the ordinary course
of business;
(b) Seller has
not entered into any agreement, contract, lease or license
(or series of related agreements,
contracts, leases and licenses) related to the
Business either (i) involving, with respect
to customer purchase orders or
similar agreements to purchase or lease the
Products, more than Five Hundred
Thousand Dollars ($500,000), and,
otherwise, more than Three Hundred Thousand
Dollars ($300,000) (in either case, which
are not cancelable on 30 days notice
or less) or (ii) outside the ordinary
course of business;
(c) no party
(including Seller or any of its Affiliates) has accelerated
any default or breach remedies, terminated,
materially modified or cancelled any
agreement, contract, lease, or license (or
series of related agreements,
contracts, leases, and licenses) by which
any of the Purchased Assets is bound
or covered involving more than One Hundred
Thousand Dollars ($100,000);
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(d) no security
interest (except for mechanics liens that are imposed by
operation of law, or purchase money
security interests or other Liens in the
ordinary course of business that do not
result in a Material Adverse Effect) has
been imposed upon any of the Purchased
Assets;
(e) Seller has
not cancelled, waived or released any material claims or
rights of value (or any series of related
claims and rights), or sold,
transferred, distributed or otherwise
disposed of any Purchased Assets used in
the Business, except for sales of finished
goods, inventory or other assets in
the ordinary course of business;
(f)
[Reserved];
(g) Seller has
not delayed or postponed the payment of accounts payable for
the Business or other liabilities of the
Business outside the ordinary course of
business;
(h) Except in
the ordinary course of business, consistent with past
practice, Seller has not delayed or
postponed the issuance of purchase orders or
the receipt of goods or services under
existing purchase orders or made any
material changes in its procurement
procedures.
(i) Seller has
not cancelled, compromised, waived, or released any right or
claim (or series of related rights and
claims) related to the Purchased Assets
either (i) involving more than One Hundred
Thousand Dollars $100,000 in the
aggregate or (ii) outside the ordinary
course of business;
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(j) Seller has
not granted any license or sublicense of any right under or
with respect to the Purchased Assets,
except in the ordinary course of business,
such as a license to end-users to use
software included in products sold in the
Business;
(k) no disposal,
cancellation or abandonment of any rights in any patent,
trademark, trade name, or copyright
included in Seller's Intellectual Property
Right, or, to Seller's knowledge, any
unauthorized disclosure to any person not
an employee of Seller or other unauthorized
disposal of any confidential and
proprietary customer lists, in either case
as used in the Business, has
occurred;
(l) Seller has
not experienced any damage, destruction, or loss (whether or
not covered by insurance) exceeding
Seventy-five Thousand Dollars ($75,000) in
any instance to the Purchased Assets;
(m) Except as
set forth on Schedule 4.1.10(m) attached hereto and made a
part hereof, Seller has not entered into
any employment contract or collective
bargaining agreement, whether written or
oral, or modified the terms of any
existing such contract or agreement
affecting employees of Seller working in the
Business;
(n) Seller has
not granted any increase in the base compensation of any of
the employees of Seller working in the
Business outside the ordinary course of
business;
(o) Except as
set forth on Schedule 4.1.10(o) attached hereto and made a
part hereof, Seller has not adopted,
amended, modified, or terminated any bonus,
profit-sharing, incentive, severance, or
other plan, contract, or commitment for
the benefit of the employees of Seller
working in the Business outside of the
ordinary course of business;
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(p) Seller has
not made any material change in any method of accounting or
keeping its books of account or accounting
practices, except as may have been
required in accordance with GAAP;
(q) Seller has
not received any written notice that any person who is a
customer or distributor of, or supplier,
manufacturer or licensor to, or a party
contracting with Seller with respect to the
Business has taken any action or
threatened to take any action which will
have or reasonably could be expected to
have a Material Adverse Effect; and
(r) Seller has
otherwise acted in all material respects in the ordinary
course of business involving the Business
or the Purchased Assets.
4.1.11 Real Properties.
(a) All of the
Real Property Leases are set forth in Schedule
4.1.2(b)(viii) attached hereto and made a
part hereof. Seller does not own any
real property used exclusively or primarily
for the Business. Seller has valid
leasehold interests in all Real Property
Leases, in each case free and clear of
all mortgages, liens, charges,
encumbrances, easements, security interests or
title imperfections (collectively, "Liens")
other than (i) those listed in
Schedule 4.1.11(a) hereto and made a part
hereof, or (ii) liens not yet due and
delinquent for current taxes, assessments
or governmental charges,
(collectively, "Permitted Liens"). The
lease of real property by Seller or the
use thereof, as presently used by the
Business, does not violate any local
zoning or similar land use laws or
governmental regulations where such violation
would have a Material Adverse Effect and
there are not pending or, to the
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knowledge of Seller, threatened lawsuits or
administrative actions relating to
the leased property or other matters
materially and adversely affecting the
current use, occupancy or value thereof.
Seller is not in violation of or in
noncompliance with any covenant, condition,
restriction, order or easement
affecting the real property owned or leased
by Seller for the benefit of the
Business where such violation or
noncompliance would have a Material Adverse
Effect, individually or in the aggregate.
There are no material approvals of
governmental authorities (including
Licenses and Permits) required in connection
with the operation of the Business on the
leased property related to the Real
Property Leases and, the properties have
been maintained in accordance with
applicable laws, rules and regulations in
all material respects. There is no
condemnation pending or, to Seller's
knowledge, threatened affecting the real
property leased by Tyco Healthcare in
Burlington, Massachusetts and used in the
Business. Seller has delivered to
Purchaser, or provided it with access to,
prior to the Closing complete and correct
copies of the Real Property Leases.
(b) Except as
set forth on Schedule 4.1.11(b), attached hereto and made a
part hereof:
(i) all Real Property Leases will continue to be legal, valid,
binding, enforceable and in full force and effect on identical
terms
following the consummation of the transactions contemplated
hereby;
(ii) all Real Property Leases are in full force and effect and,
to
Seller's knowledge, no party to any Real Property Leases is in
breach
or default, and no event has occurred which, with notice or lapse
of
time, would constitute a breach or default or permit
termination,
modification, or acceleration thereunder that would result in a
Material Adverse Effect;
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<PAGE>
(iii) no party to a Real Property Lease has repudiated any
provision
thereof that would have a Material Adverse Effect;
(iv) there are no disputes, oral agreements, or forbearance
programs
in effect as to the Real Property Leases that would have a
Material
Adverse Effect;
(v) with respect to the Real Property Leases which are subleases,
the
representations set forth above are true and correct for each
underlying lease;
(vi) Seller has not assigned, transferred, conveyed, mortgaged,
deeded
in trust, or encumbered any interest in the Real Property
Leases;
(vii) all facilities subject to a Real Property Lease are
supplied
with utilities and other services necessary for the operation of
the
facilities; and
(viii) each parcel of real property subject to a Real Property
Lease
abuts on and has direct vehicular access to a public road or
has
access to a public road via a permanent, irrevocable,
appurtenant
easement benefiting the parcel of real property, and access to
the
property is provided by paved public right-of-way with adequate
curb
cuts
available.
4.1.12 Material Contracts.
(a) Schedule
4.1.12(a) attached hereto and made a part hereof lists, as of
the date hereof, all of the Material
Contracts to which Seller is a party and
that relate to the Business. Seller has
delivered to Purchaser, or provided
Purchaser with access to, true and correct
copies of all Material Contracts
prior to the Closing. As used in this
Agreement, "Material Contracts" means all
Assumed Contracts that meet any of the
following criteria:
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<PAGE>
(i) all Personal Property Leases which entail annual rental
payments
by Seller, in the case of any such Personal Property Lease, in
excess
of Eight Thousand Dollars ($8,000);
(ii) all contracts and agreements to which Seller is a party
relating
to the Business and which are: (x) outstanding contracts,
whether
written or oral, with the officers, employees, agents,
consultants,
advisors, salesmen, sales representatives, distributors, sales
agents
or dealers of Seller requiring payments in excess of
Twenty-Five
Thousand Dollars ($25,000) per annum other than contracts which
by
their terms are cancelable by Seller with notice of not more
than
ninety (90) days (except as required by any state laws) and
without
cancellation penalties or severance payments; or (y) collective
bargaining agreements of Seller covering any employee of Seller
working in the Business;
(iii) all mortgages, indentures, security agreements, pledges,
notes,
loan agreements or guarantees relating to the Business;
(iv) all material customer contracts relating to the Business;
(v) all outstanding
contracts with vendors selling to the Business
expected to result in payment by Seller in excess of Fifty
Thousand
Dollars ($50,000);
(vi) all outstanding material licenses pursuant to which Seller is
a
licensee or a licensor and which relate to the Business, except
for
licenses for "off the shelf" computer software and hardware
licenses
in which Seller is a licensee but the rights licensed are not
material
to conduct of the Business;
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<PAGE>
(vii) all written contracts or agreements affecting the Business
and
materially restricting Seller's ability to engage in any business
or
compete with any person;
(viii) all joint venture agreements and joint product
development
agreements relating to the Business;
(ix) all sole source supply agreements relating to the Business;
or
(x) all confidentiality agreements or non-disclosure agreements
entered into by Seller in connection with Seller's efforts to sell
the
Business.
(b) All Material
Contracts are legal, valid and binding obligations of the
Seller are enforceable against Seller; are,
to the knowledge of Seller,
enforceable (except as enforcement may be
limited by equitable principles
limiting the right to obtain specific
performance or other equitable remedies or
by applicable bankruptcy or insolvency laws
and related decisions affecting
creditors' rights generally) against the
other parties in accordance with their
respective terms; and, except as listed on
Schedule 4.1.12(b) hereto, to
Seller's knowledge there is no default or
claimed or purported or alleged
default or state of facts which, with
notice or lapse of time or both, would
constitute a default on the part of any
party in the performance of any
obligation to be performed or paid by any
party under any such Material
Contract, and Seller has not received or
given notice of any default or claimed
or purported or alleged default or state of
facts which, with notice or lapse of
36
<PAGE>
time or both, would constitute a default on
the part of any party in the
performance or payment thereunder. To the
knowledge of Seller, the other parties
to all of the Material Contracts are
complying in all material respects with the
terms and provisions thereof.
(c) All of the
Material Contracts that require authorization, consent or
approval to sell, assign, transfer, convey
and deliver the Material Contracts to
Purchaser are set forth on Schedule
4.1.12(c).
(d) All
contracts related to the Business with any international
customers
that could reasonably be expected to have a
material effect on the Business
after the Closing Date, are set forth on
Schedule 4.1.12(d).
(e) All
confidentiality agreements or non-disclosure agreements (other
than
those set forth in Section 4.1.12(a)(x))
entered into by Seller relating to the
Business, whether or not material to the
Business, are set forth on Schedule
4.1.12(e), and all such agreements shall be
Assumed Contracts.
4.1.13 Intellectual Property
Rights.
Except as set forth in Schedule 4.1.13(i)
and the licenses set forth in Schedule
4.1.12(a) hereto, Seller solely owns or has
the exclusive right to use, free and
clear of all Liens other than Permitted
Liens, all of Seller's Intellectual
Property Rights. Except as set forth in
Schedule 4.1.13(i)-Exhibit A hereto,
there is no written claim or demand of any
person pertaining to, or any
proceeding pending or, to Seller's
knowledge, threatened, which challenges the
exclusive rights of Seller in respect of
Seller's Intellectual Property Rights.
Schedule 4.1.13(ii) attached hereto and
made a part hereof lists the issued,
abandoned or expired patents and pending
applications for patents which are
included in the Seller's Intellectual
Property Rights and Seller solely owns or
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<PAGE>
has the exclusive right to such patents and
patent applications. Schedule
4.1.13(iii) attached hereto and made a part
hereof lists the trademarks,
trademark registrations and pending
applications for trademarks which are
included in the Seller's Intellectual
Property Rights and Seller solely owns or
has the exclusive right to such trademarks,
trademark registrations and pending
applications. Except as set forth in
Schedule 4.1.13(i)-Exhibit A, neither any
officer of Seller nor any attorney employed
by Seller or representing Seller who
has responsibility for intellectual
property matters concerning the Business,
has been made aware of any infringement, or
any claim of infringement, of any
intellectual property rights for sales of
Products listed on Exhibit A attached
hereto made before the Closing Date.
4.1.14 No Consent Requirements.
Except for such filings and approvals, if
any, as maybe required pursuant to the
Hart-Scott-Rodino Antitrust Improvement Act
of 1976, as amended, and the rules
and regulations thereunder (the "HSR Act"),
Schedule 4.1.12(c) attached hereto
and made a part hereof, includes a complete
and accurate list of all Material
Contracts that require any consent,
approval, authorization, notice, order,
filing, registration or qualification of or
with any court, governmental
authority or third person in connection
with the execution and delivery of this
Agreement by Seller or the consummation by
Seller of the transactions
contemplated hereby.
4.1.15 Authorization.
All partnership and other proceedings
required to be taken on the part of
Seller, including, without limitation, all
action required to be taken by the
directors or limited partners of Seller to
authorize Seller to enter into, carry
out and perform any obligations under this
Agreement and to sell, transfer,
convey and deliver the Purchased Assets,
have been properly taken. This
Agreement has been duly executed and
delivered by Seller and, assuming the due
execution and delivery hereof by Purchaser,
constitutes the valid and legally
binding obligation of Seller enforceable
against it in accordance with its
terms.
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<PAGE>
4.1.16 Employee Benefit Plans;
Employment Agreement.
(a) Set forth on
Schedule 4.1.16(a) attached hereto is a complete list of
each material employee benefit plan (as
defined in Section 3(3) of ERISA),
whether or not subject to ERISA, or
material fringe benefit plan maintained or
contributed to or required to be
contributed to by Seller or any of its
subsidiaries or any organization which,
together with the Seller and/or such
subsidiary, would be treated as a "single
employer" within the meaning of
Section 414(b) or (c) of the Code, with
respect to any employee of Seller, or
any Selling Affiliate, working in the
Business ("Employee Benefit Plans") and
each contract of employment with any
employee of Seller, or any Selling
Affiliate, working in the Business (an
"Employment Agreement").
(b) Neither
Seller nor, to its knowledge, any of its Affiliates, has ever
maintained or contributed to, or had any
obligation to contribute to (or borne
any liability with respect to) any
"employee pension benefit plan," within the
meaning of Section 3(2) of ERISA, that is a
"multiemployer plan," within the
meaning of Section 3(37) of ERISA on behalf
of the Transferred Employees.
(c) Each
Employee Benefit Plan intended to be qualified under Section
401(a) of the Code, has been determined to
be so qualified by the IRS and, to
Seller's knowledge no facts or
circumstances exist which would adversely affect
the qualified status of such Employee
Benefit Plan.
(d) Except as
would not have a Material Adverse Effect on the Business, no
litigation or administrative or other
proceeding, audit, examination or
investigation is pending or asserted, or,
to the best knowledge of Seller,
threatened, anticipated or expected to be
asserted with respect to any Employee
Benefit Plan or the assets of any such plan
(other than routine claims for
benefits arising in the ordinary
course).
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<PAGE>
(e) Seller and,
to its knowledge, each of its Affiliates have paid and
discharged all of their respective
liabilities and obligations arising under
ERISA or the Code of a character which if
unpaid or unperformed would result in
the imposition of a lien against the
Purchased Assets.
(f) Each
Employee Benefit Plan has, in all material respects, been
maintained in compliance with its terms and
all material provisions of ERISA and
the Code, applicable thereto (including
rules and regulations thereunder).
(g) No
Employment Agreement provides for the payment of any compensation
or
otherwise provides for the acceleration of
any benefits, payments or severance
as a result of the transactions
contemplated by this Agreement.
(h) Except as set
forth on Schedule 4.1.16(h) each Employee Benefit Plan
which is exempt from ERISA by reason of
Section 4(b)(4) thereof (a "Foreign
Plan") is, and has been, established,
registered (where required), qualified,
administered, funded (where required) and
invested in compliance in all material
respects with the terms thereof and all
applicable laws. With respect to each
Foreign Plan, all required filings and
reports have been made in a timely and
complete manner with all governmental
authorities. All obligations of Seller or
any Affiliates to or under the Foreign
Plans (whether pursuant to the terms
thereof or any applicable laws) have been
satisfied, and there are no
outstanding defaults or violations
thereunder by Seller or any Affiliate of
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Seller. Full payment has been made in a
timely manner of all amounts which are
required to be made as contributions,
payments or premiums to or in respect of
any Foreign Plan under applicable law or
under any Foreign Plan or any agreement
relating to a Foreign Plan, and no taxes,
penalties or fees are owing or
assessable under any such Foreign Plan. To
the knowledge of Seller, no event has
occurred with respect to any registered
Foreign Plan which would result in the
revocation of the registration of such
Foreign Plan, or which would entitle any
person (without the consent of the sponsor
of such Foreign Plan) to wind up or
terminate any such Foreign Plan, in whole
or in part, or could otherwise
reasonably be expected to have an adverse
effect on the tax status of any such
Foreign Plan. There are no going-concern
unfunded actuarial liabilities, past
service unfunded liabilities or solvency
deficiencies with respect to any of the
Foreign Plans. No contribution holidays
have been taken under any of the Foreign
Plans, and there have been no withdrawals
of assets or transfers of assets from
any Foreign Plan, except in accordance with
applicable laws.
4.1.17 Personal Property.
Except as set forth in Schedule 4.1.17(i)
hereto, Seller has or will have at the
Closing: (a) good, valid and unencumbered
title (subject to Permitted Liens) to
all of its Personal Property including,
without limitation, the personal
property acquired after the date of this
Agreement (except for the inventory and
other assets sold or otherwise disposed of
in accordance with the provisions of
this Agreement), and (b) valid leasehold
interests in all Personal Property
Leases, in each case free and clear of all
Liens other than Permitted Liens and
those Liens listed in Schedule 4.1.17(i)
hereto. Except as set forth in Schedule
4.1.17(ii) hereto and subject to wear, tear
and consumption of the same in the
ordinary course of business prior to the
Closing Date, the Personal Property
that is material to the operation of the
Business is maintained in good
operating condition. Seller shall deliver
or make available to Purchaser prior
to the Closing complete and correct copies
of the Personal Property Leases.
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4.1.18 Inventory.
Except for Inventory that has been reserved
as excess or obsolete in the 2004
Audited Financial Statements or in
accordance with Seller's written policies on
obsolescence (which have been delivered to
Purchaser), all Inventory held for
sale as of the date hereof is saleable in
the ordinary course of business.
Schedule 4.1.18 contains a complete and
accurate list of addresses at which
Inventory is located and except as set
forth on Schedule 4.1.18, no Inventory is
held by any person (including any Affiliate
of Seller) on consignment. All
Inventory as of September 30, 2004 is
properly reflected on the 2004 Audited
Financial Statements. All Inventory
acquired or disposed of after September 30,
2004 was acquired or disposed of in the
ordinary course of business consistent
with past practice. The Supply Inventory is
sufficient and of the appropriate
levels to enable the Seller to perform its
obligations under the Transitional
Supply Agreement. Other than Seller and the
Selling Affiliates, no Affiliates of
Seller hold any inventories relating to or
used in the Business.
4.1.19 Product Warranty.
No product of the Business manufactured,
sold, leased or delivered in the United
States by Seller is subject to any written
guaranty, warranty, or other
indemnity, or to Seller's knowledge any
non-written guaranty, warranty or other
indemnity, beyond the Seller's applicable
regular or standard or usual terms and
conditions of sale or lease or as otherwise
provided by law. Seller has
delivered or made available to Purchaser
true and correct copies of the forms of
Seller's regular, standard or usual
customer contracts used in the United
States.
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4.1.20 Environmental Matters.
(a) For purposes
of this Agreement, the following terms shall have the
following meanings: (i) "Environmental
Laws" shall mean any and all federal,
state, and local laws, and all rules or
regulations promulgated thereunder,
relating to pollution or protection of the
environment (including, without
limitation, ambient air, surface water,
ground water, land surface, subsurface
strata, wildlife, plants, or other nat
