MASTER PURCHASE AGREEMENT

Exhibit 2.1

EXECUTION VERSION

MASTER PURCHASE AGREEMENT

dated as of February 27, 2009

by and between

OLYMPUS CORPORATION

and

BECKMAN COULTER, INC.

 

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SCHEDULES

 

Execution Version

MASTER PURCHASE AGREEMENT

This Master Purchase Agreement (this “ Agreement ”), dated as of February 27, 2009 in Tokyo, Japan is entered into by and between Olympus Corporation, a Japanese corporation (“ Seller Parent ”), on the one hand, and, Beckman Coulter, Inc., a Delaware corporation (“ Buyer Parent ”), on the other hand. Seller Parent and Buyer Parent sometimes are referred to in this Agreement collectively as the “ Parties ” and individually as a “ Party .” Seller Parent and the Affiliates of Seller Parent identified on Schedule I attached hereto are sometimes referred to in this Agreement each as a “ Seller ” and collectively as “ Sellers .”

WHEREAS, Seller Parent and the other Sellers, directly and indirectly through various Affiliates, are engaged in the Business; and

WHEREAS, Seller Parent wishes to sell, and cause the other Sellers to sell, to Buyer Parent (or one or more designees thereof), and Buyer Parent (or one or more designees thereof) wishes to purchase the Business through the purchase from the Sellers of all of (i) the outstanding capital stock of each Acquired Entity and (ii) the Acquired Assets, and Buyer Parent (or one or more designees thereof) wishes to assume the Assumed Liabilities, each upon the terms and conditions set forth herein and in connection therewith the Parties wish to enter into the transactions contemplated by this Agreement and by the Ancillary Agreements (collectively, the “ Transactions ”).

NOW, THEREFORE, in consideration of the premises and mutual covenants, agreements and provisions herein contained, the Parties agree as follows:

ARTICLE I.

DEFINITIONS

1.1     Definitions . In addition to the terms defined above and other terms defined in other Sections and Schedules of this Agreement, the following initially capitalized terms have the following meanings when used herein:

“ Accounting Firm ” means Ernst & Young LLP.

“ Accounts Receivable ” means all accounts receivable, trade receivables, notes receivable and other receivables to the extent arising out of or with respect to the Business and whether arising before or after the Closing Date.

“ Acquired Assets ” has the meaning set forth in Section 2.1 .

“ Acquired Entity ” means each of (i) Olympus France Newco, (ii) Olympus Germany Newco, (iii) Olympus Japan Newco, (iv) OME and (v) Mishima.

“ Acquired Entity Tax Indemnity ” has the meaning set forth in Section 12.1(a) .

“ Acquisition Transaction ” means any transaction with an unrelated Person involving: (a) the sale, license, disposition or acquisition of all or a substantial portion of the Business or Acquired Assets; (b) the issuance, disposition or acquisition of (i) any capital stock or other equity security of an Acquired Entity, (ii) any option, call, warrant or right (whether or not immediately exercisable) to acquire any capital stock or other equity security of an Acquired Entity, or (iii) any security, instrument or obligation that is convertible into or exchangeable for any capital stock or other equity security of an Acquired Entity; or (c) any merger, consolidation, share exchange, business combination, reorganization, recapitalization or similar transaction involving an Acquired Entity.

“ Adjusted Shares ” has the meaning set forth in Section 3.2(b) .

“ Affiliate ” means, with respect to any Person, any other Person directly or indirectly controlling, controlled by, or under common control with, such Person. For purposes of this definition, “control” (including, with correlative meanings, the terms “controlled by” and “under common control with”), as used with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by Contract or otherwise.

“ Agreement ” means this Master Purchase Agreement, including all Schedules and Exhibits hereto, as it may be amended from time to time in accordance with its terms.

“ Allocation Methodology ” has the meaning set forth in Section 2.8(a) .

“ Allocation Schedule ” has the meaning set forth in Section 2.8(a) .

“ Ancillary Agreements ” means the Transition Services Agreement, the Local Agreements, Cross-License Agreement, the Transfer Documents and, if entered into, the Stockholders’ Agreement.

“ Ancillary Intellectual Property ” means all Intellectual Property owned by the Sellers that, as of the Closing Date, is: (i) used primarily in connection with the Business; (ii) used to operate Equipment or any Product; (iii) embedded in or included with any Product; or (iv) used in the manufacture, marketing, sale, use or repair of Products, but that is not included in the Transferred Intellectual Property.

“ Antitrust Division ” has the meaning set forth in Section 5.23 .

“ Applicable Accounting Standards ” means (i) in Japan, Japan GAAP, (ii) in the United States, US GAAP, (iii) from and after April 1, 2008, in each European country, IFRS, (iv) on and prior to March 31, 2008, in each European country, the commonly accepted accounting standard for such country, and (v) in each country other than Japan, the United States and a European country, IFRS unless otherwise required by applicable Law.

“ Applicable Exchange Rate ” means the applicable exchange rate calculated in accordance with Schedule 1.2 .

“ Assumed Liabilities ” has the meaning set forth in Section 2.3 .

 

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“ Audited Financial Statements ” has the meaning set forth in Section 9.9 .

“ Books and Records ” means original or true and complete copies of all of the books, records, files, data and information, including, without limitation, customer lists, financial and accounting records, Tax records, purchase orders and invoices, sales orders and sales order log books, credit and collection records, correspondence and miscellaneous records with respect to customers and supply sources and all other general correspondence of the Business.

“ Business ” means all of the business operations and activities currently conducted as of the date hereof anywhere in the world by Seller Parent and the other Sellers (including, for the avoidance of doubt, the business conducted by the Acquired Entities prior to Closing) with respect to developing, manufacturing, marketing, selling, distributing and use of clinical chemistry and immunoassay analyzers, blood transfusion testing systems, and the chemical reagents and other consumables used with them, and related laboratory automation equipment, for in vitro diagnostic testing of samples from humans and animals, and chemical analyzers and related chemical reagents for analyzing water quality. Notwithstanding the foregoing, the Business does not include the Excluded Assets or the Excluded Liabilities.

“ Business Contracts ” has the meaning set forth in Section 2.1(e) .

“ Business Day ” means any day, other than Saturday or Sunday, on which commercial banks in Tokyo, Japan and New York, USA are generally open for business.

“ Business Financial Statements ” has the meaning set forth in Section 5.18(a) .

“ Buyer ” and “ Buyers ” means Buyer Parent or any Affiliate or Subsidiary of Buyer Parent that Buyer Parent designates to purchase any of the Acquired Assets.

“ Buyer Indemnified Party ” has the meaning set forth in Section 12.1(a) .

“ Buyer Parent ” has the meaning set forth in the recitals hereof.

“ Calculation Principles ” means the method for calculating the net assets as set forth in Schedule 1.1(cp) and based on the Reference Balance Sheet.

“ Cap ” has the meaning set forth in Section 12.1(b) .

“ Cash ” means cash, cash equivalents, bank deposits and marketable securities.

“ Cash Purchase Price ” has the meaning set forth in Section 3.2(b) .

“ Change of Control Payments ” means, with respect to the Business, any amounts that become payable to any Diagnostics Employee, regardless of when due or payable, as a result of the execution and delivery of this Agreement, the Ancillary Agreements or the consummation of the transactions contemplated hereby or thereby, including under any Olympus Benefit Plan (including, restricted stock grants and in-the-money stock options) or under any individual employment, severance or change-in-control Contract or otherwise (including any stay put or similar retention bonuses or percentage sharing arrangements) but, notwithstanding anything to

 

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the contrary set forth above, excluding (i) Redundancy Costs, (ii) such amounts that become payable under employment or severance Contracts or the like in the U.S. that are part of general employee policies covering all Diagnostics Employees in the U.S. rather than individual employees, and (iii) any other costs for which Buyer Parent is liable in accordance with Section 8.6 .

“ Claim ” means any claim, demand, cause of action, chose in action, right of recovery or off-set, suit, litigation, Proceeding, arbitration, hearing or investigation against any Person.

“ Closing ” has the meaning set forth in Section 3.1 .

“ Closing Date ” has the meaning set forth in Section 3.1 .

“ Closing Net Assets ” means the net assets of the Business, as of the day before the Closing Date, as determined in accordance with the Calculation Principles.

“ Closing Net Business Debt ” means any Net Business Debt outstanding as of the Closing.

“ Closing Payment ” has the meaning set forth in Section 3.3(b) .

“ Closing Transaction Expenses ” means any Transaction Expenses due or otherwise owed as of the Closing.

“ Code ” means the U.S. Internal Revenue Code of 1986, as amended.

“ Competing Person ” has the meaning set forth in Section 9.8(a) .

“ Competitive Activity ” has the meaning set forth in Section 9.8(a) .

“ Confidentiality Agreement ” means the Confidentiality and Non-Disclosure Agreement, effective as of September 11, 2008, by and between Seller Parent and Buyer Parent.

“ Consent ” means any consent, approval, authorization, consultation, waiver, permit, grant, agreement, license, certificate, exemption, order, registration, declaration, filing or notice of, with or to any Person.

“ Contracts ” means any commitment, contract, agreement, lease, License Agreement, consensual obligation, promise, instrument, note, indenture, legally binding commitment, license, sublicense, understanding or undertaking, whether or not legally binding, and in each case whether written or oral and whether express or implied.

“ Cross-License Agreement ” has the meaning set forth in Section 8.5(b) .

“ Customers and Distributors ” has the meaning set forth in Section 5.21 .

“ Defined Benefit Obligation ” has the meaning given such term in International Accounting Standard 19.

 

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“ Defined Benefit Retirement Plan Obligation ” means an obligation of a Seller Party, or of a pension fund, retirement plan or other benefit plan that has recourse to a Seller Party, to the Transferred Employees, which obligation accrues during the period of such Transferred Employees’ service to such Seller Party, based on a formula stipulated in employment regulations, employment contract, or labor law, which is payable after termination of employment on a voluntary or retirement age stipulated in an employee’s employment contract; provided, however, “Defined Benefit Retirement Plan Obligation” excludes Redundancy Costs and benefits to the extent covered by annuity contracts with any insurance company.

“ Defined Benefit Retirement Plan Obligations Amount ” means the sum of (i) the Projected Benefit Obligation at the Closing Date for the defined benefit corporate pension plan ( kakutei kyufu kigyo nenkin ) of Seller Parent with respect to the Seller Parent Regular Japan Business Employees, (ii) the Defined Benefit Obligation at the Closing Date for all defined benefit corporate pension plans of Sellers incorporated outside Japan and the U.S. with respect to the Transferred Employees employed outside Japan and the U.S., (iii) the aggregate benefit amount accrued at the Closing Date in respect of employees of OME and Mishima under OME’s and Mishima’s respective one-time retirement allowance plans ( taishoku kyufu kin ), and (iv) the aggregate benefit amount accrued at the Closing Date in respect of Transferred Employees of all Seller Parties under any other plan, policy, program, practice, agreement, understanding or arrangement that generates a financial liability to a Seller Party in connection with an employee’s termination of employment, including, without limitation, any such amount that is payable as a result of the employee’s retirement, resignation, voluntary termination, whether or not in the form of a pension, annuity, lump sum, installments or deferred compensation, or as a result of such employee’s retirement or voluntary termination of employment, in all cases calculated (A) based on the assumption that only employees who are employed by Sellers Parties in the Business shall be eligible to participate in such plans, and (B) without double counting of Redundancy Costs.

“ Design Rights ” has the meaning set forth in Section 2.1A(a)(xii) .

“ Diagnostics Employees ” means those employees of Sellers and the Acquired Entities of the Business identified on Schedule 5.11(b) , plus or minus any agreed upon changes.

“ Distributor Contracts ” has the meaning set forth in Section 2.5 .

“ EBITDA ” means earnings before interest, taxes, depreciation and amortization, as determined pursuant to Applicable Accounting Standards.

“ EC ” has the meaning set forth in Section 5.23 .

“ EC Filing ” has the meaning set forth in Section 5.23 .

“ EC Merger Regulation ” means Council Regulation (EC) No. 139/2004 of 20 January 2004 on the control of concentrations between undertakings (published in the Official Journal of the European Union on January 29, 2004 at L 24/1).

“ Environmental Claims ” means any written Claim, Proceeding, suit, complaint, or notice of violation or alleging violation of, or under, any Environmental Laws.

 

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“ Environmental Laws ” means all applicable Laws which (i) regulate or relate to the protection, preservation or clean up of the environment, including waterways, groundwater, drinking water, air, wildlife, plants or other natural resources; or the health and safety of persons or property, including without limitation protection of the health and safety of employees; or (ii) impose Liability or responsibility with respect to any of the foregoing, including without limitation, as applicable, the Comprehensive Environmental Response, Compensation and Liability Act (42 U.S.C. § 9601 et seq .), or any other Law of similar effect. Without limiting the generality of the foregoing, in the case of Real Property located in Japan, “Environmental Law” shall include the Basic Environment Law of Japan (Law No. 91 of 1993, as amended), Air Pollution Control Law of Japan (Law No. 97 of 1968, as amended), Water Pollution Control Law of Japan (Law No. 138 of 1970, as amended) and Law Concerning Special Measures against Dioxins of Japan (Law No. 105 of 1990, as amended), Offensive Odor Control Law of Japan (Law No. 91 of 1971, as amended), Law Concerning Reporting, etc. of Releases to the Environment of Designated Chemical Substances and Promoting Improvements in Their Management of Japan (Law No. 86 of 1999, as amended), Soil Contamination Countermeasures Law of Japan (Law No. 53 of 2002, as amended), Waste Management and Public Cleansing Law of Japan (Law No. 137 of 1970, as amended) and any analogous national or local statutes, ordinances, rules and regulations promulgated under such statutes or ordinances in Japan currently in effect.

“ Environmental Permits ” means any material Permit required under applicable Environmental Laws.

“ Equipment ” has the meaning set forth in Section 2.1(b) .

“ Equity Participations ” means (i) any share, quota, security, participation right and any other right entitling the holder, absolutely or contingently (through the exercise of any subscription, conversion, exchange, option or similar right), to participate in the revenues, dividends or equity appreciation of another Person, including capital stock, membership interests, units, performance units, options, warrants, company appreciation rights, interests in “phantom” stock plans, restricted or contingent stock or profits interests, voting securities, stock appreciation rights or equivalents, stock loan purchase plans, convertible debentures or stock bonus plans and (ii) commitments to issue any of the foregoing.

“ ERISA ” means the Employee Retirement Income Security Act of 1974, as amended, and the regulations promulgated and the rulings issued thereunder.

“ ERISA Affiliate ” means any entity which is (or at any relevant time was) a member of a “controlled group of corporations” with, under “common control” with, a member of an “affiliated service group” with, or is otherwise required to be treated as a single employer with, any Seller under Section 414(b), (c), (m) or (o) of the Code.

“ Estimated Closing Net Business Debt ” has the meaning set forth in Section 3.3(a) .

“ Estimated Closing Change of Control Payments ” has the meaning set forth in Section 3.3(a) .

“ Estimated Closing Net Assets ” has the meaning set forth in Section 3.3(a) .

 

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“ Estimated Closing Transaction Expenses ” has the meaning set forth in Section 3.3(a) .

“ European Commission ” has the meaning set forth in Schedule 5.16 .

“ Exchange Act ” means the U.S. Securities Exchange Act of 1934, as amended.

“ Excluded Assets ” has the meaning set forth in Section 2.2 .

“ Excluded Liabilities ” has the meaning set forth in Section 2.4 .

“ Expiration Date ” has the meaning set forth in Section 11.1(b) .

“ FCPA ” means the U.S. Foreign Corrupt Practices Act of 1977, as amended.

“ FDA ” means the U.S. Food and Drug Administration or similar foreign, federal, state or local Governmental Authorities who have authority with respect to the Business or Buyers’ business.

“ Fiscal Year ” means the twelve (12) month period ending on March 31 of each calendar year.

“ Foreign Antitrust Laws ” has the meaning set forth in Section 5.23 .

“ French Commercial Code ” means the French Code de Commerce .

“ French Hive-down ” means the transfer of the Acquired Assets of Olympus France SAS to Olympus France Newco by means of a statutory hive-down pursuant to the French Commercial Code.

“ FTC ” has the meaning set forth in Section 5.23 .

“ German Hive-down ” means the transfer of the Acquired Assets (i) of Olympus Deutschland GmbH and (ii) certain of its German subsidiaries, each to Olympus Germany Newco by means of a statutory hive-down ( Ausgliederung ) pursuant to the German Transformation Act.

“ German Transformation Act ” means the Germany Umwandlungsgesetz .

“ Global Purchase Price ” has the meaning set forth in Section 2.6 .

“ Government Antitrust Authority ” has the meaning set forth in Section 7.2(d) .

“ Governmental Approvals ” means all licenses, Consents, Permits, certificates, filings, registrations, notifications, authorizations and approvals required to carry on the Business as conducted as of the date of this Agreement and as of the Closing Date under the applicable Laws of any Governmental Authority.

“ Governmental Authority ” means any: (a) nation, principality, state, commonwealth, province, territory, county, municipality, district or other jurisdiction of any nature; (b) national,

 

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prefectural, municipal, local, foreign or other government; (c) governmental or quasi-governmental authority of any nature (including any governmental division, subdivision, department, agency, bureau, branch, office, commission, council, board, instrumentality, officer, official, representative, organization, unit, body or entity and any court or other tribunal); (d) multi-national organization or body; or (e) Person or body exercising, or entitled to exercise, any executive, legislative, judicial, administrative, regulatory, police, military or taxing authority or power of any nature.

“ Hazardous Materials ” means any pollutant, chemical, substance and any toxic, infectious, carcinogenic, reactive, corrosive, ignitable or flammable chemical, or chemical compound, or hazardous substance, material or waste, whether solid, liquid or gas, that is subject to regulation, control or remediation under any Environmental Laws, including without limitation, any quantity of asbestos in any form, urea, formaldehyde, PCBs, radon gas, crude oil or any fraction thereof, all forms of natural gas, petroleum products or by-products or derivatives.

“ Hiring Party ” has the meaning set forth in Section 9.7 .

“ HSR Act ” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976.

“ HSR Filing ” has the meaning set forth in Section 5.23 .

“ IFRS ” means international financial reporting standards adopted by the International Accounting Standards Board, as consistently applied.

“ Indebtedness ” means (a) all indebtedness, whether or not contingent, for borrowed money, (b) all obligations for the deferred purchase price of property or services, (c) all obligations evidenced by notes, bonds, debentures or other similar instruments, (d) all indebtedness created or arising under any conditional sale or other title retention agreement with respect to property acquired for the Business, (e) all obligations as lessee under capital leases, finance leases or similar lease financing arrangements, (f) all payment obligations, contingent or otherwise, under acceptance, letter of credit or similar facilities, (g) all indebtedness of other Persons referred to in clauses (a) through (f) above guaranteed directly or indirectly in any manner by an Acquired Entity and (h) all indebtedness referred to in clauses (a) through (f) above (including indebtedness of other Persons) secured by any Lien on the Acquired Assets (including accounts and Contract rights).

“ Indemnified Claim ” has the meaning set forth in Section 12.6(g) .

“ Indemnified Party ” has the meaning set forth in Section 12.5(a) .

“ Indemnifying Party ” has the meaning set forth in Section 12.5(a) .

“ Intellectual Property ” means all intellectual property or other proprietary rights of every kind throughout the world, including all: (a) inventions utility models and invention disclosures; (b) patents, patent applications and patent disclosures, together with all revisions, renewals, extensions, reexaminations, provisionals, reissuances, continuations, continuations-in-part, divisions and divisionals thereof and any applications for any of the foregoing, and all

 

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filings claiming priority to or serving as a basis for priority thereof; (c) trademarks, service marks, trade names, trade dress, corporate names, logos, slogans, domain names, uniform resource locators (URLs), packaging design, any other source identifiers of any kind or nature, together with all translations, adaptations, derivations and combinations thereof, all common law rights therein, and the goodwill associated with all of the foregoing , and any applications (including intent to use applications), registration and renewals for any of the foregoing; (d) copyrights, copywritable works, website content, all derivative works thereof, and any copyright applications, registrations and renewals in connection therewith; (e) mask works, design rights and any applications, registrations and renewals for any of the foregoing; (f) industrial designs and any applications, registrations and renewals for industrial designs; (g) trade secrets, know-how and confidential or proprietary business or technical information; and (h) Software.

“ Internal Regulations ” means all internal regulations and bylaws, including the bylaws of the Board of Directors, work rules, share handling regulations, and any other significant internal regulations or bylaws.

“ Inventor Laws ” has the meaning set forth in Section 5.7 .

“ Inventory ” means, as owned by Seller Parties, (i) all inventory of finished Products, whether or not labeled, (ii) all Product work-in-progress and (iii) all other inventory to the extent used or held for use or produced in the operation or conduct of the Business, wherever located, including Reagents, raw materials, work-in-process, finished goods, spare parts and shop and production supplies. For the purposes of this Agreement, “Inventory” shall be deemed to include samples of Product designated for use in promoting each Product.

“ Inventory Schedule ” has the meaning set forth in Section 5.8(a) .

“ Investment Grade ” designates a rating (or the equivalent of such ratings) of BBB- or higher by Standard & Poor’s Ratings Group and its successors or Baa3 or higher by Moody’s Investors Service, Inc and its successors. In the event that Buyer Parent shall select any other rating agency, the equivalent of such ratings by such rating agency shall be used.

“ Irish Employee ” means a Non-Japan Employee who works wholly or primarily in Ireland.

“ Irish Pension Scheme ” has the meaning set forth in Section 5.12(i) .

“ Irish PHI Scheme ” has the meaning set forth in Section 5.12(i) .

“ Japan Business ” means the Business as operated by Seller Parent, OME and Mishima.

“ Japan Business Employees ” has the meaning set forth in Section 8.6(a)(i) of Schedule 8.6 .

“ Japan Contract Employees ” means all Japan Business Employees who are employed as contract employees ( keiyaku shain ) by Olympus Japan Newco, OME or Mishima as of the Closing pursuant to definite term contracts and identified as such on Schedule 8.6(a)(i) .

 

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“ Japan Employment Commitment Period ” means the three (3) -year period immediately following the Closing.

 

“ Japan GAAP ” means accounting principles generally accepted in Japan, as consistently applied.

“ Japan Spin-Off Agreement ” means the Spin-Off agreement ( kaisha bunkatsu keiyakusho ) to be entered into between Seller Parent and Olympus Japan Newco in the form mutually agreed to by Buyer Parent and Seller Parent.

“ Know-How ” means all non-public information, proprietary or otherwise, owned, held or licensed by a Seller Party as of the Closing Date and which is necessary for Buyers to operate the Business as operated as of the Closing, including such information that relates to the Business and to the use, design, development, manufacturing, quality control, packaging, storage, registration, marketing, distribution or sale of the Products.

“ Law ” means each provision of any currently existing national, super national, provincial, federal, state, local or foreign, civil and criminal law, statute, ordinance, Order, code, rule, regulation or common law, promulgated, adopted, enacted, implemented, issued or otherwise put into effect by or under the authority of any Governmental Authority, as well as any judgments, decrees, injunctions or agreements issued or entered into by any Governmental Authority.

“Leased Real Property ” has the meaning set forth in Section 5.22(b) .

“ Liability ” means, with respect to any Person, any liability or obligation of such Person, whether known or unknown, absolute or contingent, accrued or unaccrued, matured or unmatured, disputed or undisputed, liquidated or unliquidated, secured or unsecured, joint or several, due or to become due, vested or unvested, executory, determined, determinable or otherwise, and whether or not the same is required to be accrued on the financial statements of such Person, including those arising under any Law, Order or any Contract.

“License Agreements” means any oral or written licenses, sublicenses, covenants not to sue, trademark co-existence agreements, agreements relating to the research, development, ownership or use of any Intellectual Property, agreements requiring the payment of a license fee or royalty, profit sharing or any other compensation to any other Person for the use of any Intellectual Property, and other Contracts relating to Intellectual Property.

“ Licensed Marks ” has the meaning set forth in Section 2.1A(a)(iv) .

“ Licensed Patents ” has the meaning set forth in Section 2.1A(a)(ii) .

“ Lien ” means any lien, encumbrance, mortgage, security interest, pledge, restriction on transferability, conditional sale agreement or other title retention agreement, stock borrowing or lending, or other charge or encumbrance of any nature whatsoever on any property or property interest, other than (a) mechanic’s, materialmen’s, and similar liens arising or incurred in the Ordinary Course of Business, (b) liens (i) for Taxes not yet due and payable or, (ii) with respect to the Acquired Entities, for Taxes that the applicable Acquired Entity is contesting in good faith

 

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through appropriate Proceedings and for which adequate reserves have been established in accordance with Applicable Accounting Standards, (c) purchase money liens and liens securing rental payments under capital lease arrangements incurred in the Ordinary Course of Business, and (d) purchase money security interests and other reservations of title by suppliers pending final payment for goods supplied thereby incurred in the Ordinary Course of Business.

“ Local Agreements ” means the Japan Spin-Off Agreement and the other agreements substantially in the form mutually agreed to by the Parties, which, subject to the terms and conditions of this Agreement, are to be signed at or prior to Closing, pursuant to which, among other things, for the consideration stated herein, certain Sellers shall grant, sell, transfer, convey, assign and deliver to certain Buyers, and such Buyers shall purchase and accept from such Sellers, all right, title, and interest of such Sellers in and to the specific items of Acquired Assets owned by such Sellers, and such Buyers agree to assume certain Assumed Liabilities of such Sellers, all in accordance with and pursuant to the terms and conditions therein and in accordance with the governing Law set forth in such Local Agreements, including all exhibits and attachments thereto, as contemplated by this Agreement.

“ Losses ” has the meaning set forth in Section 12.1(a) .

“ Manufacturing Instructions ” means those manufacturing, packaging and labeling specifications for the Products used in the Business in the production and supply of the Products, including the formulae and materials that such Seller Party reasonably required for the manufacture, quality control and release of the Products immediately prior to the Closing Date.

“ Marks ” has the meaning set forth in Section 2.1A(a)(iii) .

“ Material Adverse Effect ” means any effect or change that would be, or could reasonably be expected to be, materially adverse to the assets, liabilities, condition (financial or otherwise), operating results or operations of the Business, taken as a whole, or adverse to any Buyer’s right to exercise rights of ownership with respect to the Target Shares or the Acquired Assets, other than any adverse change, event, development or effect arising from or relating to any of the following (a) any material change in the economies or securities or financial markets of any country unless such effect or change disproportionately and adversely affects the Business relative to the industry in which the Business competes; (b) the public announcement of this Agreement, compliance with the terms of this Agreement or the consummation of the Transactions, including, but not limited to, any such resulting action or threatened action taken by any Person (including any vendor or customer) who is a party to a current or terminated Business Contract or Transferred License Agreement and any action by or loss of any Diagnostics Employees; (c) any outbreak of hostilities, acts of war, sabotage, terrorism, military actions, epidemics or pandemics of disease or any escalation or material worsening of any such hostilities, acts of war, sabotage, terrorism, military actions, epidemics or pandemics of disease existing or underway as of the date of this Agreement unless such effect or change disproportionately and adversely affects the Business relative to the industry in which the Business competes; and (d) any action by a Seller approved or consented to in writing by Buyer Parent after the date hereof.

“ Material Contracts ” has the meaning set forth in Section 5.10(a) .

 

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“ MIS Systems ” has the meaning set forth in Section 2.1(i) .

“ Mishima ” means Mishima Olympus Co., Ltd., a Japanese corporation.

“ Mishima Employee ” has the meaning set forth in Section 8.6(a)(i) .

“ Multiemployer Plan ” shall mean any “multiemployer plan” as defined in Section 3(37) of ERISA.

“ Net Business Debt ” means the items set forth on Schedule 1.1(bd) (which shall be net of any Cash) and all other items of Indebtedness of the Business, including any Indebtedness of the Acquired Entities. For the avoidance of doubt, “Net Business Debt” does not include any items taken into account in the determination of Closing Net Assets or, to the extent deducted from the Global Purchase Price pursuant to Section 3.3, (i) any Transaction Expenses, or (iii) any Change of Control Payments.

“ New Pension Plan ” has the meaning set forth in Section 7.7 .

“ Non-Competition Period ” has the meaning set forth in Section 9.8 .

“ Non-Japan Employee ” has the meaning set forth in Section 8.6(b)(i) of Schedule 8.6 .

“ Non-U.S. Benefit Plan ” means any standard salary, sales incentive, variable payment, extra standard salary, extraordinary salary, bonus, profit-sharing, deferred compensation, stock-based incentive, pension, severance, retirement, regular retirement allowance at the company rate, special retirement allowance, guaranteed “age 60” retirement allowance, company provided or leased housing, housing allowance, vacation, holiday, paid time off, sick leave, cash gifts of congratulations and condolences, hospitalization or other medical, disability, life or other insurance, retirement plan, program, agreement, arrangement, commitment, policy or understanding and each other employee benefit plan, program, agreement, arrangement, commitment, policy or understanding, whether on a group or individual basis, that is established, maintained, sponsored or contributed to by any Seller for the benefit of any current or former director, officer, employee or consultant (or any dependent or beneficiary thereof) of the Non-U.S. Business of Seller.

“ Non-U.S. Business ” means the Business as operated outside of the United States on the date hereof.

“ Olympus Benefit Plan ” means any Non-U.S. Benefit Plan or U.S. Benefit Plan.

“ Olympus Brands ” means the trademarks or trade names “Olympus ^® ” and any variants thereof presently used in connection with the Business and any related stylized symbols.

“ Olympus France Newco ” means a corporation to be newly organized by Olympus France SAS under the Laws of France, and wholly owned by a Seller.

“ Olympus Germany Newco ” means, collectively, one or more corporations to be newly organized by Olympus Deutschland GmbH or another Olympus German entity under the Laws

 

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of Germany, and wholly owned by a Seller.

“ Olympus Japan Newco ” means a corporation to be newly organized by Olympus Corporation under the Laws of Japan, and wholly owned by Seller Parent.

“ OHIA ” has the meaning set forth in Section 8.6(a)(v)(A) .

“ OME ” means Olympus Medical Engineering Co., Ltd., a Japanese corporation.

“Open Source Software” means any Software (in whole or in part) that is used pursuant to a license that (a) creates, or purports to create, obligations for a licensor with respect to the Software, or (b) grants, or purports to grant, to any other Person any rights or immunities under the licensor’s Intellectual Property or proprietary rights in the Software, including any Software that (i) requires as a condition of use, modification and/or distribution of such Software that any other Software incorporated into, derived from or distributed with such Software be disclosed or distributed in source code form, licensed for the purpose of making derivative works, or redistributable at no charge or is derived from any Software that is subject to such requirement, or (ii) any version of Software licensed under any of the following licenses or distribution models, or licenses or distribution models similar to any of the following: GNU’s General Public License (GPL) or Lesser/Library GPL (LGPL), The Artistic License (e.g., PERL), the Mozilla Public License, the Netscape Public License, the Berkeley software design (BSD) license including FreeBSD or BSD-style license, the Sun Community Source License (SCSL), an Open Source Foundation License (e.g., CDE and Motif UNIX user interfaces), and the Apache Server License.

“ Ordinary Course of Business ” means the operation of the Business in the usual and customary way and consistent with past practices.

“ Order ” means any writ, judgment, decree, injunction, ruling, order or similar requirement or binding obligation or order of any Governmental Authority or Regulatory Authority (in each such case whether preliminary or final).

“ Organizational Documents ” has the meaning set forth in Section 5.3(a) .

“ Owned Real Property ” has the meaning set forth in Section 5.22(a) .

“ Patents ” has the meaning set forth in Section 2.1A(a)(i) .

“ Paying Party ” has the meaning set forth in Section 9.2(c) .

“ Pension Transfer ” has the meaning set forth in Section 8.6(a)(iv)(C) .

“ Permits ” means all permits, licenses, registrations, certificates, franchises, variances, exemptions, orders and other Governmental Approvals, Consents and authorizations necessary for the past or present conduct of, or required for, the operation of, the Business, other than Regulatory Registrations.

“ Person ” means any individual, corporation, partnership, joint venture, limited liability

 

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company, trust or unincorporated organization, joint venture, joint stock company or Governmental Authority.

“ Post-Closing Tax Period ” means any Tax period beginning after the Closing Date and that portion of any Straddle Period beginning after the Closing Date.

“ Pre-Closing Tax Period ” means any Tax period ending on (and including) the Closing Date and the portion of any Straddle Period ending on (and including) the Closing Date.

“ Prime Rate ” means the rate per annum published in the Nihon Keizai Shinbun from time to time as the prime lending rate prevailing during any relevant period for borrowings in the applicable currency.

“ Proceeding ” means any Claim, action, arbitration, audit, hearing, inquiry, examination, proceeding, investigation, opposition, litigation or suit (whether civil, criminal, administrative, or investigative) commenced, brought, conducted, or heard by or before, or otherwise involving any Governmental Authority or arbitrator.

“ Product ” or “ Products ” means those products identified on Schedule 1.1(p) (which shall for avoidance of doubt includes all consumables, including the Reagents).

“ Projected Benefit Obligation ” has the meaning given such term by Japan GAAP.

“ Property Taxes ” shall mean all real property Taxes, personal property Taxes and similar ad valorem Taxes.

“ Post-Closing Statement ” has the meaning set forth in Section 3.3(c) .

“ Promotional Activities ” means those activities undertaken prior to the Closing to encourage sales of the Products, including: journal advertising, broadcast advertising, direct mail programs, detailing, customer meetings, conventions and trade show exhibits, presentations, end user training, marketing plan development, ongoing post-market development, demand generation, symposia and other forms of advertising, promotion, sales and customer support.

“ Quality and Testing Procedures ” has the meaning set forth in Section 5.8(c) .

“ Reagents ” means the chemical or other substances, including those listed on Schedule 1.1(r) , used in connection with the Products to produce chemical or other reactions for the purpose of detecting and/or measuring the medical conditions and substances listed on Schedule 1.1(r) .

“ Real Property ” has the meaning set forth in Schedule 2.1(j) .

“ Real Property Leases ” has the meaning set forth in Section 5.22(b) .

“ Reference Amount ” means the amount of Net Assets in Yen, set forth on the Reference Balance Sheet.

 

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“ Reference Balance Sheet ” has the meaning set forth in Section 7.8 .

“ Regular Japan Business Employees ” shall mean all Japan Business Employees employed as regular employees ( seishain ) by Olympus Newco Japan, OME and Mishima immediately prior to the Closing pursuant to indefinite term contracts and identified as such on Schedule 8.6(a)(i) .

“ Regulatory Authority ” means any Governmental Authority that is responsible for issuing technical, medical, scientific, labeling and similar licenses, registrations, authorizations, permits and approvals necessary for the manufacture, use, storage, import, transport, marketing, sale, labeling or disposal of the Products, and any notified body designated by a member state of the European Union carrying out the tasks pertaining to conformity assessments procedures for the Products.

“ Regulatory Documentation ” means all applications, files and correspondence with Regulatory Authorities for the Regulatory Registrations and all relevant pricing information and correspondence with Regulatory Authorities related to the Business, including the following: (i) approval letters; (ii) Product labeling files and artworks for each country, in paper and electronic format; (iii) validation of manufacturing processes and/or remediation studies and reports; (iv) complete copies of regulatory files; (v) copies of the Regulatory Registrations (including copies of cGMP (continuing good manufacturing practices) certificates); (vi) copies of the variations and all correspondence related to them; (vii) copies of all labeling for all stock keeping units for the Products; (viii) copies of all expert reports, pre-clinical and clinical reports; (ix) copies of existing specifications (including copies of validation of analytical methods); (x) copies of the complaints, if any, received since January 1, 2005; (xi) any information on recalls, if any, since January 1, 2005; and (xii) a chart showing the renewal dates for the Regulatory Registrations.

“ Regulatory Registrations ” means the premarket approvals issued by the FDA, CE markings of conformity, including underlying certifications, registrations and/or declarations, product, marketing and repair authorizations issued by the Minister of Health, Labor and Welfare of Japan, and all other technical, medical, scientific, labeling, importation, distribution and similar licenses, registrations, authorizations, permits and approvals of the Products (including marketing authorizations and labeling approvals) issued by the Regulatory Authorities of any country and held as of the Closing Date by Sellers that are required for the marketing, promotion, distribution or sale of the Products within any country, all of which are listed on Schedule 2.1(f). Where the context so requires “Regulatory Registrations” also includes those held by third party distributors and dealers.

“ Related Parties ” has the meaning set forth in Section 5.26 .

“ Relevant Transfer ” has the meaning set forth in Section 5.11(i) .

“ Representatives ” means, with respect to any Person, any officers, directors, employees, Affiliates, attorneys, investment bankers, financial advisers, agents or other representatives of such Person.

“ Required Consent ” has the meaning set forth in Section 2.5(a) .

 

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“ Responsible Parties ” has the meaning set forth in Section 9.2(c) .

“ Review Period ” has the meaning set forth in Section 3.3(d) .

“ Rules ” has the meaning set forth in Section 13.10(a) .

“ Schedules ” has the meaning set forth in Section 7.6 .

“ Schedules Date ” means the date on which the Parties have agreed on the form and substance of all Schedules to this Agreement and have amended this Agreement to attach them hereto.

“ SEC ” means the United States Securities and Exchange Commission.

“ SEC Filings ” has the meaning set forth in Section 6.7 .

“ Securities Act ” means the U.S. Securities Act of 1933, as amended.

“ Seller ” and “ Sellers ” have the meaning set forth in the recitals hereof.

“ Seller Indemnified Party ” has the meaning set forth in Section 12.2(a) .

“ Seller Parent ” has the meaning set forth in the recitals hereof.

“ Seller Parent Spin-Off ” means the spin-off ( kyushu bunkatsu ) transaction pursuant to which Seller Parent shall transfer its portion of the Business, including all Acquired Assets and Assumed Liabilities that are held by Seller Parent, except Seller Parent’s interest in the Transferred Intellectual Property, to Olympus Japan Newco pursuant to the Japan Spin-Off Agreement.

“ Seller Parent’s Knowledge ” means the actual knowledge, after reasonable investigation, of the individuals set forth on Schedule II ;

“ Seller Party ” means each Seller and, prior to the Closing Date, each Acquired Entity.

“ Seller Redundant Employees ” has the meaning set forth in Section 8.6(f)(iv) .

“ Sellers’ Disclosure Schedules ” has the meaning set forth in the introductory paragraph to ARTICLE V .

“ Shares ” means shares of the Buyer Parent’s common stock, par value $0.10 per share.

“ Shizuoka Prefectural Approval ” has the meaning set forth in Section 10.2(x) .

“ Software ” means computer software, firmware, programs and databases in any form, including Internet web sites, web content and links, source code, executable code, machine code, tools, developers kits, utilities, graphical user interfaces, menus, images, icons, and forms, and all versions, updates, corrections, enhancements and modifications thereof, and all related documentation, developer notes, comments and annotations related thereto that exists as of the

 

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Closing and related primarily to or used in the Business.

“ Special Indemnification ” has the meaning set forth in Section 12.3 .

“ Standard Operating Procedures ” has the meaning set forth in Section 5.8(b) .

“ Stock Purchase Price ” means the Yen Equivalent of the value of the Unadjusted Shares or the Adjusted Shares, as the case may be, calculated based on the average of the daily closing price for a Share as reported by the New York Stock Exchange for the twenty (20) consecutive trading days preceding the fifth (5th) Business Day prior to the Closing Date.

“ Stockholders Agreement ” has the meaning set forth in Section 8.5(e) .

“ Straddle Period ” means any Tax period beginning on or before and ending after the Closing Date.

“ Stub Financial Statements ” has the meaning set forth in Section 9.9 .

“ Subsidiary ” or “ Subsidiaries ” means, with respect to any Person, any other Person of which (i) if a corporation, a majority of the total voting power of shares of capital stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers, or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a combination thereof, (ii) if a limited liability company, partnership, association or other business entity (other than a corporation), either the managing member or general partner or a majority of partnership or other similar ownership interest thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more other Subsidiaries of that Person or a combination thereof and for this purpose, a Person or Persons owns a majority ownership interest in such a business entity (other than a corporation) if such Person or Persons shall be allocated a majority of such business entity’s gains or losses or shall be any managing director or general partner of such business entity (other than a corporation) or control any managing director or general partner of such business entity (other than a corporation) or (iii) is otherwise contractually entitled to direct and control.

“ Suppliers ” has the meaning set forth in Section 5.21 .

“ Surviving Representations ” has the meaning set forth in Section 12.1(b) .

“ Target Shares ” means all of the outstanding Equity Participations of Olympus France Newco, Olympus Germany Newco and Olympus Japan Newco and all of the outstanding Equity Participations of OME and Mishima.

“ Taxes ” means all taxes, charges, fees, duties, levies or other assessments, including, without limitation, income, gross receipts, net proceeds, ad valorem, turnover, real and personal property (tangible and intangible), sales, consumption, use, franchise, excise, value added, license, payroll, unemployment, environmental, customs duties, capital stock, disability, stamp, leasing, lease, user, transfer, fuel, excess profits, occupational and interest equalization, windfall profits, severance and employees’ or third parties income withholding and Social Security taxes,

 

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and taxes of any other kind whatsoever imposed by Japan or any foreign country or by any state, region, municipality, subdivision or instrumentality of Japan or of any foreign country or by any other tax authority and such term shall include (i) any interest, penalties, surcharges or additions to tax attributable to such taxes and (ii) any amounts levied pursuant to Section 75 and Section 73 of the German Tax Code ( Abgabenordnung ).

“ Tax Matter ” has the meaning set forth in Section 9.5(f)(i) .

“ Tax Return ” means any return, declaration, report, claim for refund or information return or statement relating to Taxes, including any schedule or attachment thereto, and including any amendment thereof.

“ Technical Information ” means all documents, drawings, specifications and any other documented information of a technical nature primarily relating to the Business or the Products wherever located which, in each case: (i) are owned or controlled by a Seller or any Affiliate thereof as of the Closing Date; and (ii) to the extent such documents relate to the use, design, development, validation, materials and components, biological compatibility, manufacture, processing, testing, storage, packaging, labeling, regulations, safety, quality or performance of the Products, including, periodic safety updated reports and information about adverse events reportable to Regulatory Authorities (real or alleged) received since January 1, 2006 and all corrective and preventive action taken since such date.

“ Technology Transfer Plan ” has the meaning set forth in Section 8.5(d) .

“ Threshold Amount ” means one percent (1%) of the Global Purchase Price.

“ Transactions ” has the meaning set forth in the recitals hereof.

“ Transaction Expenses ” means any cost, expense, payment, expenditure or Liability of the Business (including any Acquired Entity) incurred prior to the Closing that relates to services of professional advisors (e.g., accounting, legal, investment banking and the like) rendered predominantly with respect to the Transactions (including any Ancillary Agreement), but (i) only to the extent performed at or prior to the Closing, and (ii) excluding all costs and expenses of auditors related to Consents required by the SEC, customary “comfort letters” in connection with securities offerings of Buyer Parent, and preparation of any financial statements or other reports required by Law, in each case which costs and expenses of auditors are to be borne solely by Buyers under Section 8.1(d) . For the avoidance of doubt, “Transaction Expenses” does not include any items taken into account in the determination of Closing Net Assets or, to the extent deducted from the Global Purchase Price pursuant to Section 3.3 .

“ Transaction Statement ” has the meaning set forth in Section 3.3(a) .

“ Transfer Date ” has the meaning set forth in Section 8.6(a)(iv)(B) .

“ Transfer Documents ” means, collectively, any and all agreements, assignments, deeds, notarial forms, certificates and other instruments in forms attached as exhibits to the Local Agreements and other instruments of sale, conveyance, transfer, assignment and/or assumption, as the case may be, between a Seller and a Buyer as necessary under the Law of the relevant

 

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jurisdiction or contemplated by this Agreement and the applicable Local Agreement in order to transfer all right, title and interest of such Seller in and to the Acquired Assets, and for the Assumed Liabilities to be effectively assumed by and transferred to such Buyer, in accordance with the terms hereof and of the applicable Local Agreement, including any and all bills of sale; assignment and assumption agreements; patent, trademark and copyright assignments; transition services agreements; and non-competition agreements.

“ Transfer Taxes ” has the meaning set forth in Section 9.2(a) .

“ Transferred Employees ” has the meaning set forth in Section 8.6(c) .

“Transferred Intellectual Property” has the meaning set forth in Section 2.1A(a) .

“ Transferred License Agreements ” has the meaning set forth in Section 2.1A(b) .

“ Transferred Non-Japan Employee ” has the meaning set forth in Section 8.6(b)(i) .

“ Transition Services Agreement ” means the transition services agreement to be entered into by Sellers and Buyer Parent as contemplated by Section 8.5 .

“ TUPE ” means the UK Transfer of Undertakings (Protection of Employment) Regulations 2006 (as amended) and the Irish European Communities (Protection of Employees on Transfer of Undertakings) Regulations 2003 (as amended) as applicable in UK and Ireland respectively.

“ UK Employee ” means a Non-Japan Employee who works wholly or primarily in the UK respectively.

“ UK GPPP ” means the Group Personal Pension Plan which UK Employees are eligible to join, as consistently applied.

“ Unadjusted Shares ” has the meaning set forth in Section 3.2(b) .

“ Unfunded Pension Obligations ” means the difference between (a) the Defined Benefit Retirement Plan Obligations Amount, minus (b) the market value of all assets and other value of the defined benefit corporate pension plans described in clause (i) and (ii) of the definition of “Defined Benefit Retirement Plan Obligations Amount” that are transferred to the New Pension Plan or to the Buyers, plus interest accrued on a daily basis at a rate equal to the discount rate specified in Section 8.6(f)(ii) for the period beginning on the date of calculation and ending on the date of actual transfer.

“ United States ,” “ US ” and “ U.S. ” mean the United States of America (including its territories and possessions).

“ U.S. Benefit Plan ” means each “employee benefit plan” as defined in Section 3(3) of the ERISA (whether or not subject to ERISA) and each other plan, policy, program practice, agreement, understanding or arrangement (whether written or oral) providing compensation or other benefits to any current or former director, officer, employee or consultant (or to any

 

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dependent or beneficiary thereof) of the U.S. Business of Seller or any ERISA Affiliate, which is now, or was at any time, maintained, sponsored or contributed to by Seller or any ERISA Affiliate, or under which Seller or any ERISA Affiliate has or may have any obligation or liability, whether actual or contingent, including, without limitation, all incentive, bonus, deferred compensation, vacation, holiday, cafeteria, medical, disability, stock purchase, stock option, stock appreciation, phantom stock, restricted stock or other stock-based compensation plans, policies, programs, practices or arrangements.

“ U.S. Business ” means the Business as operated in the United States on the date hereof.

“ U.S. GAAP ” means accounting principles generally accepted in the United States, as consistently applied.

“ U.S. Multiemployer Plan ” shall mean any “multiemployer plan” as defined in Section 3(37) of ERISA providing compensation or other benefits to any current or former director, officer, employee or consultant (or to any dependent or beneficiary thereof) of the U.S. Business of Seller or any ERISA Affiliate.

“ U.S. Pension Plan ” shall mean any “employee pension benefit plan” as defined in Section 3(2) of ERISA (other than a U.S. Multiemployer Plan) providing compensation or other benefits to any current or former director, officer, employee or consultant (or to any dependent or beneficiary thereof) of the U.S. Business of Seller or any ERISA Affiliate with respect to which Seller or any ERISA Affiliate maintains, administers, contributes to or is required to contribute to, or has maintained, administered, contributed to or was required to contribute to, or under which Seller or any ERISA Affiliate may incur any liability.

“ U.S. Welfare Plan ” shall mean any “employee welfare benefit plan” as defined in Section 3(1) of ERISA providing compensation or other benefits to any current or former director, officer, employee or consultant (or to any dependent or beneficiary thereof) of the U.S. Business of Seller or any ERISA Affiliate with respect to which Seller or any ERISA Affiliate maintains, administers, contributes to or is required to contribute to, or under which Seller or any ERISA Affiliate may incur any liability.

“ Yen ” means the lawful currency of Japan.

“ Yen Equivalent ” means the amount of Yen into which another currency is converted using the Applicable Exchange Rate.

1.2     Construction .    Unless expressly specified otherwise, whenever used in this Agreement, the terms “Annex,” “Appendix,” “Article,” “Exhibit,” “Schedule” and “Section” refer to annexes, appendices, articles, exhibits, schedules and sections of this Agreement (and, for the avoidance of doubt, does not refer to appendices, articles, sections, schedules and exhibits of any Ancillary Agreement). Whenever used in this Agreement, the terms “hereby,” “hereof,” “herein” and “hereunder” and words of similar import refer to this Agreement as a whole, including all articles, sections, schedules and exhibits hereto. Whenever used in this Agreement, the terms “include,” “includes” and “including” mean “include, without limitation,” “includes, without limitation” and “including, without limitation,” respectively. Whenever the context of this Agreement permits, the masculine, feminine or neuter gender, and the singular or plural

 

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number, are each deemed to include the others. “Days” means calendar days unless otherwise specified. Except as otherwise expressly provided herein all references to “Yen” or “¥” refer to the lawful money of Japan. Unless expressly provided otherwise in this Agreement, all calculations requiring the conversion of currency from one denomination to another in connection with this Agreement or an Ancillary Agreement shall be made based on the Applicable Exchange Rate. References in this Agreement to particular sections of a Law shall be deemed to refer to such sections or provisions as they may be amended after the date of this Agreement. The Parties have participated jointly in the negotiation and drafting of this Agreement and in the event an ambiguity or question of intent or interpretation arises, this Agreement shall be construed as if drafted jointly by the Parties and no presumption or burden of proof shall arise favoring or disfavoring any Party (or any Affiliate thereof) by virtue of the authorship of any of the provisions of this Agreement.

1.3     Control .    In the event of a conflict between this Agreement and any Ancillary Agreement, unless such Ancillary Agreement expressly provides otherwise with reference to this Section 1.3, this Agreement shall control to the extent permitted by applicable Law, and to the extent not so permitted, the applicable Ancillary Agreement shall control.

1.4     Performance of Obligations by Affiliates .    Any obligation of a Seller under or pursuant to this Agreement may be satisfied, met or fulfilled, in whole or in part, at Seller Parent’s sole and exclusive option, either by Seller Parent directly or by any Affiliate or designee of Seller Parent that Seller Parent causes to satisfy, meet or fulfill such obligation, in whole or in part. Any obligation of Buyer Parent under or pursuant to this Agreement may be satisfied, met or fulfilled, in whole or in part, at Buyer Parent’s sole and exclusive option, either by Buyer Parent directly or by any Affiliate or designee of Buyer Parent that Buyer Parent causes to satisfy, meet or fulfill such obligation, in whole or in part. With respect to any particular action, the use of the words “Seller Parent shall,” “Seller Parent agrees to,” “Sellers shall,” a “Seller shall,” “Seller Parties shall,” and a “Seller Party shall,” and any similar variation with respect to any action, also means “Seller Parent shall cause” the particular action to be performed, and the use of the words “Buyer Parent shall,” “Buyer Parent agrees to,” “Buyers shall,” a “Buyer shall,” and any similar variation with respect to any action, also means “Buyer Parent shall cause” the particular action to be performed, because Seller Parent and Buyer Parent each understand, agree and acknowledge that they are entering into this Agreement on behalf of themselves and certain of their respective Affiliates. Seller Parent guarantees the performance of all actions, agreements and obligations to be performed by any Subsidiaries or Affiliates of Seller Parent under the terms and conditions of this Agreement and any applicable Ancillary Agreement, and Buyer Parent guarantees the performance of all actions, agreements and obligations to be performed by any Affiliates of Buyer Parent under the terms and conditions of this Agreement and any applicable Ancillary Agreement, regardless of whether or not Buyer Parent and/or Seller Parent are a party thereto.

ARTICLE II.

PURCHASE AND SALE

2.1     Agreements to Purchase and Sell .    Except as otherwise provided in this Agreement or in any Local Agreement, at the Closing, in accordance with this Agreement and

 

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pursuant to the terms and conditions of the Local Agreements, as applicable, for the consideration stated herein, Sellers shall grant, sell, transfer, convey, assign and deliver to Buyers, and Buyers shall purchase and accept from Sellers, free and clear of all Liens, all right, title, and interest of Sellers in and to the Transferred Intellectual Property of Sellers set forth in Section 2.1A and all of the other assets of Sellers that are used primarily in the Business, including the following (collectively, the “ Acquired Assets ”):

(a)    all Inventory;

(b)    all of the rights to the fixed and other tangible personal property used primarily in the Business whether owned or leased by Sellers (collectively, the “ Equipment ”);

(c)    copies of the documents and information placed in the Intralinks virtual data room by Seller Parent for review by Buyer Parent during the negotiation of this Agreement, the index to which is attached hereto as Schedule 2.1(c) ;

(d)    Intentionally Omitted;

(e)    subject to the provisions of Section 2.5 , the Contracts to the extent related to the Business or the Acquired Assets (other than the License Agreements), including those Contracts set forth on Schedule 2.1(e)(i) , (collectively the “ Business Contracts ”);

(f)    to the extent transferable under applicable Law, the Regulatory Registrations, including those listed in Schedule 2.1(f) , supported by and including: (i) the original documents under the possession of Sellers evidencing the Regulatory Registrations, or if the original is not available, certified copies of the portions thereof related to the Products, in each case to the extent assignable with or without the Consent of the issuing Regulatory Authority; (ii) all related Regulatory Documentation; provided, however, that if any Regulatory Documentation also covers the manufacturing, marketing or sale of other products of Sellers or their Affiliates, Sellers may elect to redact those portions of Regulatory Documentation that pertain to such other products, or deliver certified copies of such materials un-redacted but subject to the confidentiality provisions of this Agreement; and (iii) all of Sellers’ rights with respect to any Regulatory Registrations under any agreement pursuant to which any Regulatory Registrations are held in the name of a third party. If an application of a Seller for a Regulatory Registration is pending on the Closing Date and such Regulatory Registration may be assigned under applicable Law once obtained, Buyer Parent may elect, at its sole and exclusive cost, to have such Seller continue with the pending application for such Regulatory Registration, in which event such Seller shall use commercially reasonable efforts to obtain such Regulatory Registration (for the avoidance of doubt, Buyer Parent may not make such election if such Regulatory Registration will not be assignable under applicable Law once obtained by such Seller), or if the pending application for such Regulatory Registration is assignable, to have such Seller assign to a Buyer designated by Buyer Parent any rights that such Seller may have with respect to the pending application for such Regulatory Registration. Sellers shall not be liable to or have any obligation to indemnify Buyers if all or any of the pending applications for Regulatory Registrations are delayed or are not issued for any reason by any Regulatory Authority unless such delay or nonissuance is a direct result of an act or omission by any Seller that constitutes gross negligence or intentional misconduct;

 

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(g)    copies of the design history files with respect to the Products; provided, however, that if any design history files also covers the design history files of other products of Sellers or any of their Affiliates, Sellers may elect to redact those portions that pertain to such other products or deliver copies of the design history files un-redacted but subject to the confidentiality provisions of this Agreement;

(h)    Intentionally Omitted;

(i)    all management information or information technology systems used primarily in connection with the conduct of the Business that are owned, licensed, leased or otherwise held for use by the Sellers or operated on behalf of the Sellers, including all computer hardware, Software, and telecommunications systems used primarily in connection with the conduct of the Business (the “ MIS Systems ”);

(j)    all real property, buildings, structures and improvements thereon, whether owned or leased by Sellers or any of Sellers’ Affiliates, together with the fixtures and fittings attached thereto, including manufacturing, distribution and administration facilities of Sellers, in each case as described on Schedule 2.1(j) (the “ Real Property ”);

(k)    all goodwill with respect to the Products, the Acquired Assets and the Business;

(l)    the Target Shares;

(m)    all Accounts Receivable;

(n)    all Books and Records;

(o)    all tangible and intangible assets specifically transferred to a Buyer pursuant to a Local Agreement; and

(p) the other tangible and intangible assets primarily used in the Business.

2.1A     Intellectual Property .    Notwithstanding any other provision to the contrary, after the execution and delivery of this Agreement, Buyer Parent and Seller Parent shall negotiate in good faith the definitions of Ancillary Intellectual Property, Intellectual Property, Know-How, License Agreements, Licensed Marks, Licensed Patents, Manufacturing Instructions, Marks, Open Source Software, Software, Technical Information and Sections 2.1A , 2.1B and 5.7 pursuant to the principles set forth on Schedule 2.1A . Buyer Parent and Seller Parent further agree and acknowledge that, anything to the contrary contained herein notwithstanding, (x) the current terms of Sections 2.1A (other than this introductory paragraph), 2.1B and 5.7 hereof may require further modification to correspond with the intent of such principles, and (y) they will negotiate in good faith following the execution of this Agreement with respect to the terms of any such required modifications.

(a)    Except as otherwise provided in this Agreement or in any Local Agreement, at the Closing, in accordance with this Agreement and pursuant to the terms and conditions of the Local Agreements, as applicable, for the consideration stated herein, Sellers

 

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shall grant, sell, transfer, convey, assign and deliver to Buyers, and Buyers shall purchase and accept from Sellers, free and clear of all Liens, all right, title, and interest of Sellers in and to (and, in the case of Licensed Patents, Licensed Marks and the rights set forth in Section 2.1A(a)(xiii) , subject to Section 2.5 ), all Intellectual Property owned by or licensed to Sellers and managed by Seller Parent’s Diagnostics Systems Division, used primarily in the Business or primarily related to the Acquired Assets, which consists of: (i) the issued patents, utility models and patent applications owned or co-owned by Sellers which are listed on Schedule 2.1A(a)(i) , and which Schedule 2.1A(a)(i) may be amended from time to time after the Closing Date to add additional patents, utility models or patent applications owned or co-owned by Sellers which become known to Sellers or the Buyers to be primarily used in the Business, according to owner on the date hereof (the “ Patents ”), including all revisions, renewals, extensions, reexaminations, provisionals, reissuances, continuations, continuations-in-part, divisions and divisionals thereof, and all filings claiming priority to or serving as a basis for priority thereof; (ii) the issued patents, utility models and patent applications licensed to Sellers which are listed on Schedule 2.1A(a)(ii) according to licensee on the date hereof (the “ Licensed Patents ”); (iii) the internet domain names, trademarks and service marks, and all applications and registrations for the foregoing, owned or co-owned by Sellers which are listed on Schedule 2.1A(a)(iii) according to owner on the date hereof, together with all common law rights and the goodwill associated therewith (the “ Marks ”); (iv) the trademarks and service marks licensed to Sellers which are listed on Schedule 2.1A(a)(iv) according to licensee on the date hereof (the “ Licensed Marks ”); (v) subject to Section 8.2 , all trade dress, logos, packaging design and slogans, in each case, to the extent primarily related to and primarily used in connection with the Business, together with all common law rights and the goodwill associated therewith; (vi) all the copyrights in the documents primarily related to the Business provided pursuant to Section 2.1(c) ; (vii) all copyrights in (A) all design history files described in Section 2.1(g) , (B) the Manufacturing Instructions, (C) the Technical Information and (D) all Promotional Activities; (viii) all registered copyrights listed on Schedule 2.1A(a)(viii) ; (ix) all copyrights in both published and unpublished works, including without limitation all compilations, in each case, to the extent primarily related to and primarily used in connection with the Business; (x) all Software including any customized databases and customized computer programs owned or co-owned by Sellers that exists as of the Closing and is primarily used to conduct the Business, used to operate Equipment or any Product, embedded in or sold in connection with any Product, or used in the manufacture, marketing, sale or repair of Products, manuals and other documentation and all copyrights and applications thereof, and all derivatives, translations, adaptations and combinations thereof, in each case, if primarily related to and used in connection with the Business or the Acquired Assets; (xi) the Know-How; (xii) the design rights ( ishoken ) and design right applications owned or co-owned by Sellers which are listed on Schedule 2.1A(a)(xii) according to owner on the date hereof (the “ Design Rights ”); (xiii) all rights to Intellectual Property granted to Sellers under the Transferred License Agreements; (xiv) all copies and tangible embodiments thereof of each of the foregoing (in whatever form or medium); and (xv) all rights to sue at law or in equity for all Claims or causes of actions arising out of or related to any past, present or future infringement, misappropriation or violation of any of the foregoing, including the right to receive all proceeds and damages therefrom (all of the foregoing in this Section 2.1A(a) , together with the Manufacturing Instructions and the Technical Information, the “ Transferred Intellectual Property ”). The foregoing notwithstanding, to the extent Transferred Intellectual Property includes any Intellectual Property co-owned by or licensed to Sellers,

 

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Sellers are transferring hereunder only Sellers’ interest in such Intellectual Property.

(b)    Except as otherwise provided in this Agreement or in any Ancillary Agreement, at the Closing, in accordance with this Agreement and pursuant to the terms and conditions of the Ancillary Agreements, as applicable, for the consideration stated herein and subject to the provisions of Section 2.5 , Sellers shall grant, sell, transfer, convey, assign and deliver to Buyers, and Buyers shall purchase and accept from Sellers, free and clear of all Liens, all right, title and interest in and to the License Agreements granting any Seller any rights to any Intellectual Property or relating to any Intellectual Property granted by any Seller to another Person, in each case that is primarily related to the Business or the Acquired Assets and those License Agreements set forth on Schedule 2.1A(b) (collectively, the “ Transferred License Agreements ”). The foregoing notwithstanding, Sellers are transferring hereunder only Seller’s interest in the Transferred License Agreements.

2.1B     Transfer of Intellectual Property .    Sellers shall be solely responsible for preparing and filing all documents necessary to create a clean chain of title in Seller’s name for the Transferred Intellectual Property including any documents necessary to change the name of a Seller in the records of any applicable Governmental Authority to reflect such Seller’s current name if different than appears in such records. Filing fees for all such filings necessary to complete the chain of title in Seller’s name shall be borne by Sellers. Buyers shall, with the reasonable assistance of Sellers, be responsible for preparing and filing all documents necessary to transfer the ownership of Transferred Intellectual Property to Buyers or their designees, in all countries necessary for Buyers or their designees to enforce such Transferred Intellectual Property. Filing fees for all such filings shall be paid by Buyers; provided, however , that Seller Parent shall reimburse Buyers for one-half of all such filing fees within thirty (30) days of presentation of an invoice for such fees. At any time after the Closing, if a Seller discovers or identifies any Intellectual Property primarily related to the Business that would have, at the time of the Closing, been deemed to be Transferred Intellectual Property ( “After-Discovered IP” ), such Sellers shall promptly notify Buyer Parent in writing. The Parties shall take all actions reasonably necessary to transfer such After-Discovered IP to Buyers. Sellers shall bear the cost of recording any transfers of recordable After-Discovered IP with an applicable Governmental Authority. The Transferred Intellectual Property and the Transferred License Agreements shall be transferred to Buyers as set forth on Schedule 2.1B .

2.2     Excluded Assets .    Notwithstanding anything to the contrary in this Agreement, Sellers shall not, nor shall Sellers cause any of their Affiliates to, sell, transfer or assign, and Buyers and Buyers’ Affiliates shall not, nor shall Buyers or Buyers’ Affiliates have any right to, purchase or otherwise acquire, any right, title or interest in any of the following assets, properties, rights or interests of the Sellers or any of the Sellers’ Affiliates related to the Business (the “ Excluded Assets ”):

(a)    rights of Sellers and Sellers’ Affiliates arising under this Agreement, the Ancillary Agreements or from the consummation of the Transactions;

(b)    any Accounts Receivable to the extent not included in the calculation of Net Assets;

 

25

(c)    Cash, including Cash on hand and Cash in transit (except to the extent owned by the Acquired Entities or included in the calculation of Closing Net Business Debt);

(d)    books (including corporate minute books), documents, records (including stock records), files and Tax Returns of Sellers or Sellers’ Affiliates as may exist on the Closing Date which: (i) were prepared in connection with or relating to the Transactions, including bids received from other Persons and analyses relating to the Acquired Assets, the Assumed Liabilities or the Business; or (ii) are maintained by Sellers, their Affiliates and/or their Representatives, agents or licensees in connection with their respective Tax, legal, regulatory or reporting requirements (except to the extent related to the Business, in which case, Buyer Parent shall receive a copy of such);

(e)    Intellectual Property of any kind of Sellers or any of their Affiliates which is not specifically included in Sections 2.1 , 2.1A and 2.1B , including the Olympus Brands and the Ancillary Intellectual Property;

(f)    rights to refunds of Taxes paid by or on behalf of a Seller or any of their Affiliates (but not paid by Buyers or any of their Affiliates or any Acquired Entity) for Pre-Closing Tax Periods;

(g)    insurance policies and Claims thereunder, except to the extent owned by the Acquired Entities;

(h)    the services of any employee of Sellers or any of their Affiliates other than Diagnostics Employees, except as provided in the Transition Services Agreement; and

(i)    the Olympus Benefit Plans and their assets, except as otherwise provided in Section 8.6.

2.3     Assumed Liabilities .    On the Closing Date, in accordance with and pursuant to the terms and conditions of the Local Agreements, Buyers shall assume only the Liabilities of Sellers related or pertaining to the Business and which are specifically identified below in this Section 2.3 (the “ Assumed Liabilities ”), unless otherwise specifically excluded under Section 2.4 :

(a)    the Liabilities regarding the Transferred Employees that are assumed by Buyers pursuant to Section 8.6 , including all Liabilities for compensation payable to the Transferred Employees for services performed after the Closing Date, and, subject to the provisions of Section 8.6(f) , all Unfunded Pension Obligations and Redundancy Costs;

(b)    all Liabilities under the Business Contracts if and to the extent they accrue after the Closing Date; provided, however, that Buyers shall have no obligation to perform or pay any Liabilities arising out of or resulting from any breach of or default under any provision of any Business Contract by a Seller Party on or before the Closing Date;

(c)    Taxes allocated to Buyers pursuant to Section 9.5(d) ;

(d)    Intentionally Omitted;

 

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(e)    all Indebtedness of the Business, including any Indebtedness of the Acquired Entities to the extent included in Closing Net Assets;

(f)    all Liabilities specifically assumed by a Buyer pursuant to the terms of a Local Agreement;

(g)    Intentionally Omitted;

(h)    without limiting anything else in this Section 2.3 , any and all Liabilities, or Claims involving the Products, the Equipment, the Business Contracts, the Transferred License Agreements or the ownership or use of the Acquired Assets based upon, relating to or arising out of acts, omissions or events occurring after the Closing Date, except for the Excluded Liabilities;

(i)    all Liabilities relating to the operation of the Business after the Closing, except to the extent included in the Excluded Liabilities;

(j)    the Net Business Debt to the extent deducted from the Global Purchase Price pursuant to Section 3.3 ;

(k)    the Change of Control Payments to the extent deducted from the Global Purchase Price pursuant to Section 3.3 ; and

(l)    the Transaction Expenses to the extent deducted from the Global Purchase Price pursuant to Section 3.3 .

2.4     Excluded Liabilities .    Neither Buyers nor any of their Affiliates shall assume, nor shall they become responsible for any Liabilities of the Business or of the Sellers or any of the Sellers’ Affiliates other than the Assumed Liabilities (collectively, the “ Excluded Liabilities ”), which Excluded Liabilities shall include, without limitation, the following:

(a)    all accounts payable related to the Business to the extent not included in the calculation of the Closing Net Assets;

(b)    except as allocated to Buyers pursuant to Sections 9.2 and 9.5(d) , any Liability for Taxes imposed on Seller Parties with regard to the Products or the Business or the Acquired Assets, including without limitation (i) any Liability of Seller Parties for the Taxes of any other Person (other than Taxes of the Acquired Entities for any Post-Closing Tax Period) by operation of law, as a transferee or successor, by contract, or for any other reason, (ii) any Taxes imposed on Sellers attributable to the German Hive-down or the French Hive-down and (iii) any Taxes attributable to the Seller Parent Spin-Off;

(c)    any Liabilities relating to the Net Business Debt to the extent not deducted from the Global Purchase Price pursuant to Section 3.3 ;

(d)    any Liabilities relating to the Change of Control Payments to the extent not deducted from the Global Purchase Price pursuant to Section 3.3 ;

 

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(e)    any Liabilities relating to the Transaction Expenses to the extent not deducted from the Global Purchase Price pursuant to Section 3.3 ;

(f)    any Liabilities relating to the operation of the Business prior to the Closing, except to the extent included in the Assumed Liabilities;

(g)    any Liabilities under or in connection with any Excluded Assets;

(h)    any Liabilities specifically excluded pursuant to the terms of a Local Agreement;

(i)    any Liabilities for actual or alleged infringement of third party Intellectual Property by the manufacture, making, using, selling, offering for sale or importing of any Products prior to the Closing Date, including the pro rata portion of any damages assessed against the manufacture, making, using, selling offering for sale or importing of any Products prior to the Closing Date, except to the extent taken into account in the determination of Closing Net Assets;

(j)    any Liabilities for compensation payable to the Transferred Employees for services performed prior to the Closing Date, including any Liabilities for compensation or payment made by any employee of the Business pursuant to the use of such employee invention in any Products prior to the Closing Date, including the pro rata portion of any damages assessed against the manufacture, making, using, selling offering for sale or importing of any Products prior to the Closing Date, except to the extent taken into account in the determination of Closing Net Assets; and

(k)    except as otherwise provided in Section 8.6 , any Liabilities arising in connection with or relating to any Olympus Benefit Plan.

2.5     Procedures for Assignments .

(a)    Anything in this Agreement to the contrary notwithstanding, neither this Agreement nor any Local Agreement shall constitute an agreement to assign or transfer any Acquired Asset, including without limitation any Contract, Regulatory Registration or Permit or any Claim, right, benefit or obligation thereunder or resulting therefrom, to Buyers, if an assignment or transfer thereof, without the Consent of a Person, would not be effective and/or would constitute a breach or violation thereof and such Consent is not obtained at or prior to the Closing (each, a “ Required Consent ”). Except as otherwise specifically contained in this Agreement, the Parties acknowledge and agree that Sellers shall bear all ordinary course out-of-pocket costs related to the obtaining of any Required Consents. If Sellers and Buyers are not successful in obtaining a Required Consent at or prior to the Closing, then the Parties agree that on and after the Closing, Sellers and Buyers (a) will use commercially reasonable efforts to obtain such Required Consent and, either directly or by causing one of Sellers’ or Buyers’ Affiliates to, in the name of the relevant Sellers and Buyers, use commercially reasonable efforts (i) to assure that the rights of Buyers under such Acquired Assets shall be preserved and (ii) to facilitate receipt of the consideration and other economic benefits to be received by Buyers in and under every such Contract, Regulatory Registration, Permit and Claim, which consideration shall be held for the benefit of, and shall be delivered to, Buyers and (b) shall not agree to any

 

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amendment, supplement, waiver or other modification of any such Contract, Regulatory Registration, Permit and Claim without the prior written Consent of Buyer Parent. Seller Parent and Buyer Parent hereby agree to keep each other reasonably informed of the progress of Sellers’ and Buyers’ efforts to obtain Required Consents and to consult each other in connection therewith. In the event that Regulatory Registrations or Permits required for the distribution of the Products can be held by more than one Person, Buyer Parent undertakes to ensure that Buyers hold at or prior to the Closing all such Regulatory Registrations and Permits.

(b)    Without limiting the generality of Section 2.5(a) , in the event that a Consent is not obtained from a third party legally required for the sale, assignment or transfer to Buyers of any Acquired Asset, or for the assumption by Buyers of any Assumed Liability, has not been obtained by the Closing Date, then:

(i)    such Acquired Asset or Assumed Liability shall not be transferred to Buyers at the Closing (and such lack of transfer shall not be deemed to be a breach of any obligation hereunder by Sellers or Buyers);

(ii)    Buyers shall use commercially reasonable efforts to make available and deliver to Sellers all Business related products and services as reasonably required by Sellers, subject to availability on an equal basis with other customers, to fulfill their ongoing obligations arising under non-transferred Acquired Assets or Assumed Liabilities;

(iii)    Sellers and Buyers shall use their commercially reasonable efforts to enter into an arrangement designed to provide Buyers with the benefit of Sellers’ rights under or pursuant to such Acquired Asset, and/or to provide Sellers with the benefit of the Buyers’ assumption of such Assumed Liability, as the case may be;

(iv)    Sellers and Buyers shall cooperate with each other in obtaining any such required Consent after the Closing; and

(v)    upon obtaining all required Consents for transfer of such Acquired Asset or Assumed Liability (as the case may be), such Acquired Asset or Assumed Liability shall be deemed transferred to or assumed by Buyer as of the receipt of such Consent, and Sellers and Buyer shall each execute, without further consideration, any documents reasonably required to confirm that such Acquired Asset or Assumed Liability has been assigned to and assumed by Buyers.

(c)    Buyer Parent acknowledges, on behalf of itself and its Affiliates, that the Seller Parties are parties to a number of Business Contracts with distributors and dealers (the “ Distributor Contracts ”) and that some or all of such distributors and dealers hold Regulatory Registrations and Permits. The Parties shall use commercially reasonable efforts to transfer to Buyers effective immediately following the Closing (i) all Product Registrations and Permits held by third party distributors and dealers with respect to countries and jurisdictions in which Buyer Parent has an Affiliate and (ii) all Distributor Contracts.

(i)    With respect to any Distributor Contract covering any country or jurisdiction where the applicable Product Registrations and Permits cannot be transferred

 

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to Buyers directly, Buyers shall use commercially reasonable efforts, with the reasonable assistance of Sellers, to apply and otherwise obtain for Buyers following the Closing the required Product Registrations and Permits covering such countries or jurisdictions.

(ii)    With respect to any Distributor Contract to which the third party does not consent to the transfer of such Distributor Contract, then such Distributor Contract shall not be transferred to Buyers at the Closing but Sellers shall use their commercially reasonable efforts to provide Buyers with the benefit of Sellers’ rights under or pursuant to such Distributor Contract. Section 2.5(b)(ii) shall apply mutatis mutandis with respect thereto.

(iii)    Buyers shall be responsible for all out-of-pocket costs and expenses related to amending any Regulatory Registrations or Permits or applying for new Regulatory Registrations or Permits; provided, however, all such costs related to the Buyers’ obtaining the Regulatory Registrations and Permits for the Products in The People’s Republic of China shall be equally shared by the Parties.

2.6     Global Purchase Price .    The total purchase price for the Acquired Assets is seventy-seven billion four hundred fifty million Yen (¥77,450,000,000) (the “ Global Purchase Price ”), plus the assumption of the Assumed Liabilities. The Global Purchase Price shall be adjusted in accordance with Section 3.2(b)(ii), 3.3 and 12.7.

2.7     Withholding of Taxes .    Buyers shall be entitled to deduct and withhold from any consideration payable or otherwise deliverable pursuant to this Agreement such amounts as may be required to be deducted or withheld therefrom under any provision of U.S. federal, state, local or foreign Tax Law. All amounts so deducted or withheld by any of Buyers shall be timely remitted and reported by the applicable Buyer to the appropriate Governmental Authority. To the extent such amounts are so deducted or withheld and so remitted and reported, such amounts shall be treated for all purposes under this Agreement as having been paid to Sellers. Buyer Parent shall promptly deliver to Seller Parent withholding tax certificates or other written evidence of both the amount and fact of remittance to the appropriate Governmental Authority of all amounts deducted or withheld by any of Buyers hereunder, together with any other documents, instruments or other information reasonably requested by Seller Parent, which are sufficient to support a claim by the applicable Seller for foreign tax credits or deductions under applicable Tax Laws.

2.8     Purchase Price Allocation .

(a)    Seller Parent shall deliver to Buyer Parent within sixty (60) days after the date of this Agreement the proposed allocation of the Global Purchase Price (the “ Allocation Schedule ”), calculated, to the extent consistent with applicable Law, based on the EBITDA of each Seller Party for the Fiscal Year ending March 31, 2009 (or, in the case where a Seller Party has negative EBITDA for the Fiscal Year ending March 31, 2009, the net asset value of the Acquired Assets transferred by such Seller Party) (the “ Allocation Methodology ”), broken down to indicate (i) the total portion of the Global Purchase Price to be allocated to among the Transferred Intellectual Property and the Transferred License Agreements to Buyers; (ii) the portions of the Global Purchase Price to be allocated on a country-by-country basis; and (iii) the

 

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portion of the Global Purchase Price to be allocated to the Equity Participations of each Acquired Entity.

(b)    The Parties shall work together to agree upon the Allocation Schedule within thirty (30) days after Seller Parent’s delivery of the schedules to Buyer Parent. In the event the Parties are unable to agree upon the Allocation Schedules within such thirty (30) -day period then Buyer Parent and Seller Parent shall jointly engage the Accounting Firm. The Accounting Firm shall prepare the allocation schedule in question in accordance with the Allocation Methodology (to the extent consistent with applicable Law), and such allocation schedule shall be deemed final, conclusive and binding upon the Buyers and the Sellers. Buyer Parent and Seller Parent agree to provide to the Accounting Firm such information as the Accounting Firm may reasonably request in connection with the preparation of any such schedules and shall request that the Accounting Firm prepare and deliver to Buyer Parent and Seller Parent any such allocation schedules within thirty (30) days. The fees and expenses of the Accounting Firm with respect to such allocation schedule shall be borne equally by Buyer Parent and Seller Parent. The Parties, on behalf of themselves and their Affiliates, agree that the procedure set forth in this Section 2.8(b) for resolving disputes with respect to the allocation of the Closing Payment shall be the sole and exclusive method for resolving any such disputes; provided, however, that this provision shall not prohibit either Party from instituting litigation to enforce any ruling of the Accounting Firm resolving any such disputes.

(c)    Buyer Parent and Seller Parent agree to revise the allocation schedules in good faith and in accordance with the Allocation Methodology (to the extent consistent with applicable Law) to reflect any adjustments to the Global Purchase Price pursuant to Section 3.3. If Buyer Parent and Seller Parent cannot agree to revisions to the allocation schedules described in the immediately preceding sentence, the Parties, on behalf of themselves and their Affiliates, agree that the procedures set forth in Section 2.8(b) for resolving disputes shall be the sole and exclusive method for resolving any disputes under this Section 2.8(c) .

(d)    Intentionally Omitted.

(e)    All Tax Returns shall be prepared consistently with such final allocations, unless otherwise required pursuant to a “determination” within the meaning of Section 1313(a) of the Code or similar requirement under other applicable Law. The Parties shall make jointly the necessary elections and execute and file, within the prescribed times therefor, the prescribed election forms and any other documents required to give effect to the foregoing and also prepare and file all of their respective Tax Returns in a manner consistent with such elections. The Parties agree to take no action and cause Persons under their control to take no position inconsistent with such final allocation for Tax purposes, unless otherwise required pursuant to a “determination” within the meaning of Section 1313(a) of the Code or similar requirement under other applicable Law.

(f)    With respect to the allocation of consideration to the acquisition of Target Shares or Acquired Assets from a given Seller, the Parties agree that to the extent possible, the portion of such allocable consideration that consists of stock and the portion that consists of cash will be determined so that each such acquisition is treated as a taxable acquisition for U.S. federal income tax purposes.

 

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ARTICLE III.

CLOSING

3.1     Closing .    The closing of the Transactions (the “ Closing ”) shall take place in accordance with and pursuant to the terms and conditions of this Agreement and the Local Agreements at the offices of Squire, Sanders and Dempsey L.L.P., Gaikokuho Kyodo Jigyo Horitsu Jimusho, Ebisu Prime Square Tower, 16/F, 1-1-39 Hiroo, Shibuya-ku, Tokyo 150-0012, Japan no later than five (5) Business Days following the satisfaction or waiver of all of the conditions set forth in ARTICLE X (other than conditions with respect to actions to be taken at the Closing itself) or at such other time, date or place as Seller Parent and Buyer Parent may mutually agree (the “ Closing Date ”). The Parties aspire that the Closing shall occur on July 1, 2009.

3.2     Transactions at Closing .    At the Closing, subject to the terms and conditions hereof:

(a)     Sellers’ Actions and Deliveries .    In accordance with and pursuant to the terms and conditions of this Agreement and each Local Agreement, Seller Parent shall: (i) transfer and convey, or cause to be transferred and conveyed, to Buyer Parent (and to such Affiliates of Buyer Parent as instructed by Buyer Parent in writing prior to the Closing Date) all of the Acquired Assets free and clear of all Liens pursuant to the Local Agreements set forth on Schedule 10.1(f) ; (ii) execute and deliver, or cause to be executed and delivered, to Buyer Parent (and/or to such Affiliates of Buyer Parent as instructed in writing by Buyer Parent prior to the Closing Date) the Ancillary Agreements that call for a Seller’s signature, to the extent not signed previously; (iii) deliver share certificates representing the Target Shares, which certificates shall be duly endorsed in blank or accompanied by duly executed stock powers, or, in those jurisdictions where applicable, notarized deeds of transfer reasonably acceptable to Buyer Parent; (iv) Seller Parent shall file with the applicable Governmental Authority the Japan Spin-Off Agreement and related documents; and (v) the relevant Sellers shall file with the competent commercial registers the French Hive-down and the German Hive-down.

(b)     Payment of Closing Payment .    Buyer Parent shall pay, or cause to be paid, the Closing Payment to Seller Parent (which Seller Parent shall receive for itself and on behalf of all other Sellers) in either of the following manners, which Buyer Parent may select in its sole discretion:

(i)     Minimum Cash Option :

 

(A)

Payment of forty-seven billion five hundred million Yen (¥47,500,000,000) (the “ Minimum Cash Payment ”) by a wire transfer of immediately available funds in accordance with written instructions provided by Seller Parent at least five (5) Business Days prior to the Closing Date; plus

 

(B)

issue and deliver to Seller Parent a stock certificate in the name of Seller Parent (or one Affiliate of Seller Parent as instructed in writing by Seller Parent at least five (5)

 

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Business Days prior to the Closing Date) representing a number of Shares, rounded to the nearest whole number of shares (“ Unadjusted Shares ”), with a Stock Purchase Price of twenty-nine billion nine hundred fifty million Yen (¥29,950,000,000); provided however , that if as a result of the issuance of the Unadjusted Shares to Seller Parent (or its Affiliate, if applicable), Seller Parent, together with its Affiliates, would own 14.9% or more of Buyer Parent’s outstanding capital stock immediately after the Closing, then Buyer Parent shall instead issue a number of Shares to Seller Parent (or to such Affiliate of Seller Parent as instructed in writing by Seller Parent at least five (5) Business Days prior to the Closing Date) so as to cause Seller Parent, together with its Affiliates, to own less than 14.9% of Buyer Parent’s outstanding capital stock immediately after the Closing (“ Adjusted Shares ”) and deliver on the Closing Date a stock certificate in the name of Seller Parent representing the Adjusted Shares. In that case, the Minimum Cash Payment shall be increased such that the sum of the Stock Purchase Price of the Adjusted Shares and the Minimum Cash Payment equals the Closing Payment; or

(ii)     Additional Cash Option :    In lieu of any Unadjusted Shares or Adjusted Shares, as the case may be, Buyer Parent may substitute as payment a wire transfer of immediately available funds equal to 95.1585977% of the Stock Purchase Price of such Unadjusted Shares or Adjusted Shares. The number of such Shares for which Buyer Parent substitutes cash may be determined by Buyer Parent in its sole discretion.

(iii)    In no event shall (A) the Cash Purchase Price be less than the Minimum Cash Payment, or (B) the sum of the Stock Purchase Price and the Cash Purchase Price exceed the Closing Payment.

(c)     Buyers’ Actions and Deliveries .    Buyer Parent shall execute and deliver, or cause to be executed and delivered, to Seller Parent (and/or to such Affiliates of Seller Parent as instructed by Seller Parent in writing to Buyer Parent prior to the Closing Date) the Ancillary Agreements that call for a Buyer’s signature, to the extent not signed prior to the Closing Date.

3.3     Purchase Price Adjustments .

(a)    Not more than fifteen (15) and not less than ten (10) Business Days prior to the Closing Date, Seller Parent shall deliver to Buyer Parent a statement (the “ Transaction Statement ”) that contains Seller Parent’s reasonable good faith estimates of (i) the Closing Net Assets (including all of the components thereof) prepared in accordance with the Calculation Principles (the “ Estimated Closing Net Assets ”), (ii) the Closing Net Business Debt (the “ Estimated Closing Net Business Debt ”), (iii) the Closing Transaction Expenses (the “ Estimated Closing Transaction Expenses ”) and (iv) the Change of Control Payments (the “ Estimated

 

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Closing Change of Control Payments ”):

(b)    The Global Purchase Price shall be subject to adjustment at the Closing as follows:

(i)    If the Estimated Closing Net Assets is greater than the Reference Amount, the Global Purchase Price shall be increased by such excess.

(ii)    If the Estimated Closing Net Assets is less than the Reference Amount, the Global Purchase Price shall be reduced by such deficit.

(iii)    The Global Purchase Price shall be reduced by the amount of the Estimated Closing Net Business Debt, if any.

(iv)    The Global Purchase Price shall be reduced by the amount of the Estimated Closing Transaction Expenses, if any.

(v)    The Global Purchase Price shall be reduced by the amount of the Estimated Closing Change of Control Payments.

The Global Purchase Price, as adjusted pursuant to this Section 3.3(b) and Section 3.2(b)(ii) , if applicable, is the “ Closing Payment .”

For avoidance of doubt, at such time as any item is included in the calculation or determination of Closing Net Assets, Change of Control Payments, Transaction Expenses or Net Business Debt, such item shall not separately be included in the calculation of any of the other foregoing amounts. Under no circumstances shall either Party be entitled to double recovery under this Agreement.

(c)    Within ninety (90) calendar days after the Closing, Buyer Parent shall prepare and deliver to Seller Parent a statement (the “ Post-Closing Statement ”) of (i) the Closing Net Assets (including all of the components thereof) prepared in accordance with the Calculation Principles, (ii) the Closing Business Debt, (iii) the Closing Transaction Expenses and (iv) the Change of Control Payments.

(d)    Seller Parent shall notify Buyer Parent of its acceptance or dispute of any amounts reflected on the Post-Closing Statement, within thirty (30) calendar days after Seller Parent’s receipt of such statement (such 30-day period hereinafter referred to as the “ Review Period ”). Any such notice of disagreement shall specify, with a reasonably detailed explanation, those items or amounts as to which Seller Parent disagrees (and shall include Seller Parent’s proposed changes to Buyer Parent’s calculation of the Closing Net Assets, Closing Business Debt, Change of Control Payments and Closing Transaction Expenses, as applicable). Seller Parent shall be deemed to have agreed with all items and amounts included in the Post-Closing Statement delivered pursuant to Section 3.3(c) that Seller does not dispute, and Seller Parent or Buyer Parent, as applicable, shall pay within five (5) Business Days of the conclusion of the Review Period the maximum amount, if any, which Buyer Parent and Seller Parent agree would otherwise be owed pursuant to Section 3.3(f) , as applicable, upon the final resolution of Closing Net Assets, Closing Business Debt, Change of Control Payments and Closing Transaction

 

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Expenses, as applicable (the “ Undisputed Amounts ”).

(e)    In the event of a dispute with respect to the Post-Closing Statement, Buyer Parent and Seller Parent shall negotiate in good faith to reconcile their differences and any resolution by them as to any disputed amounts shall be final, binding and conclusive on the Parties. If Buyer Parent and Seller Parent are unable to reach a resolution to such effect within thirty (30) calendar days after Buyer Parent’s receipt of Seller Parent’s written notice of disagreement, Buyer Parent and Seller Parent shall submit the amounts remaining in dispute for resolution to the Accounting Firm. The Accounting Firm shall be directed to, within thirty (30) calendar days after submission of the dispute, determine and report to the parties upon such remaining disputed amounts with respect to the Post-Closing Statement, and such report shall be final, binding and conclusive on the Parties hereto and shall constitute an arbitral award upon which a judgment may be entered in any court having jurisdiction thereof. The Accounting Firm shall address only those items in dispute. Buyer Parent shall bear and pay a percentage of the fees and disbursements of the Accounting Firm that is equal to the percentage of the total amount of changes proposed to the Post-Closing Statement by Seller Parent that are successful, and Seller Parent shall bear and pay a percentage of the fees an disbursements of the Accounting Firm that is equal to the percentage of the total amount of changes proposed to the Post-Closing Statement by Seller Parent that are not successful, in each case as determined by the Accounting Firm. The Parties, on behalf of themselves and their Affiliates, agree that the procedure set forth in this Section 3.3 for resolving disputes with respect to adjustments of the Global Purchase Price under this Section 3.3 shall be the sole and exclusive method for resolving any such disputes; provided, however, that this provision shall not prohibit either Party from instituting litigation to enforce any ruling of the Accounting Firm resolving any such disputes.

(f)    No later than five (5) Business Days after the final resolution of Closing Net Assets, Closing Business Debt, Change of Control Payments and Closing Transaction Expenses, as applicable, in accordance with this Section 3.3 , Buyer Parent or Seller Parent, as applicable, shall make the following payments; provided that, such payments shall only be made to the extent that the amounts owed have not otherwise been satisfied by a prior payment, if any, of the Undisputed Amounts pursuant to Section 3.3(d) .

(i)    If the Closing Net Assets as finally determined in accordance with this Section 3.3 is less than the Estimated Closing Net Assets, Seller Parent shall pay the amount of such shortfall to Buyer Parent.

(ii)    If the Closing Net Assets as finally determined in accordance with this Section 3.3 is greater than the Estimated Closing Net Assets, Buyer Parent shall pay the amount of such excess to Seller Parent.

(iii)    If the Closing Business Debt as finally determined in accordance with this Section 3.3 is less than the Estimated Closing Business Debt, Buyer Parent shall pay the amount of such shortfall to Seller Parent.

(iv)    If the Closing Business Debt as finally determined in accordance with this Section 3.3 is greater than the Estimated Closing Business Debt, Seller Parent shall pay the amount of such excess to Buyer Parent.

 

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(v)    If the Closing Transaction Expenses as finally determined in accordance with this Section 3.3 are less than the Estimated Closing Transaction Expenses, Buyer Parent shall pay the amount of such shortfall to Seller Parent.

(vi)    If the Closing Transaction Expenses as finally determined in accordance with this Section 3.3 are greater than the Estimated Closing Transaction Expenses, Seller Parent shall pay the amount of such excess to Buyer Parent.

(vii)    If the Change of Control Payments as finally determined in accordance with this Section 3.3 are less than the Estimated Closing Change of Control Payments, Buyer Parent shall pay the amount of such shortfall to Seller Parent.

(viii)    If the Change of Control Payments as finally determined in accordance with this Section 3.3 are greater than the Estimated Closing Change of Control Payments, Seller Parent shall pay the amount of such excess to Buyer Parent.

(g)    Any payment to be made as a result of an adjustment to the Global Purchase Price pursuant to this Section 3.3 shall be paid by wire transfer of immediately available funds, together with interest thereon for the period commencing on the Closing Date through the date on which such payment is made calculated at the Prime Rate. Such interest shall be payable at the same time as the payment to which it relates and shall be calculated on a per diem basis.

3.4     Intercompany Accounts .    Seller Parent shall cause each intercompany account, other than with respect to accounts relating to the trade of goods or services in the Ordinary Course of Business to the extent treated as current receivables or current liabilities for purposes of the calculation of Closing Net Assets, existing between the Business (including an Acquired Entity) and Sellers or any Sellers’ Affiliates, to be eliminated prior to the Closing; provided, however , that no such action shall create any Liability for the Business, any Buyer or any Acquired Entity. Furthermore, Seller Parent shall cause each intercompany account of the Business, other than with respect to accounts relating to the trade of goods or services in the Ordinary Course of Business, to be eliminated prior to the Closing.

3.5     Intercompany Agreements .    Any Business Contracts that are between a Seller (or an Acquired Entity) on one hand, and another Seller or Affiliate of Sellers on the other hand, shall be handled as set forth in Schedule 3.5 .

ARTICLE IV.

[INTENTIONALLY OMITTED]

ARTICLE V.

REPRESENTATIONS AND WARRANTIES OF SELLERS

Except as set forth in the Sellers’ disclosure schedules to be attached hereto (the “ Sellers’ Disclosure Schedules ”) (each of which qualifies the correspondingly numbered representation and warranty to the extent expressly specified therein and other representations and warranties to

 

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the extent that a matter is disclosed in such a way as to make its relevance to the information called for by such other representation and warranty readily apparent), Seller Parent, on its behalf and, to the extent applicable, on behalf of each other Seller, represents and warrants to Buyer Parent that the statements contained in this ARTICLE V are correct and complete as of the date hereof and as of the Closing Date (or as of such other date indicated). The Parties acknowledge that the Seller’s Disclosure Schedules have not been delivered and agreed to by the Parties as of the date hereof but such schedules shall be delivered and agreed to as provided in Section 7.6 .

5.1     Organization . Each Seller and Acquired Entity is an entity organized and validly existing and in good standing (to the extent such concept is recognized in the applicable jurisdiction) under the Laws of its jurisdiction of incorporation or formation, and is duly qualified to transact business in all jurisdictions where the nature of its business or properties makes such qualification necessary, except as to jurisdictions where the failure to qualify would not, individually or in the aggregate, reasonably be expected to be material to the Business. Each Seller and Acquired Entity has all requisite corporate, partnership or similar power and authority to own, lease and operate its properties and to carry on the Business as now being conducted by such Seller or Acquired Entity.

5.2     Due Authorization .

(a)    Seller Parent has all necessary corporate power and authority to execute, deliver and perform its obligations under this Agreement and the Ancillary Agreements, to the extent it will be a party thereto, and the consummation of the transactions contemplated hereby and thereby and the execution and delivery of this Agreement and the Ancillary Agreements to the extent it will be a party thereto, and the performance of all of its obligations hereunder and thereunder have been duly authorized by Seller Parent. The signing, delivery and performance by Seller Parent of this Agreement and the Ancillary Agreements is not prohibited or limited by, and shall not result in a material breach of or a material default under, any provision of the Organizational Documents of Seller Parent, or of any material Contract binding on Seller Parent, or of any applicable Order, and shall not result in any Lien on any of the Acquired Assets (other than as may result from the action of the Buyers). This Agreement has been duly executed and delivered by Seller Parent, and the Ancillary Agreements will, at the Closing, be duly executed and delivered by Seller Parent to the extent Seller Parent is party thereto, and this Agreement constitutes, and when executed and delivered by Seller Parent, to the extent Seller Parent is party thereto, the Ancillary Agreements will constitute, legal, valid and binding obligations of Seller Parent enforceable against Seller Parent in accordance with their respective terms, except as enforceability may be limited or affected by applicable bankruptcy, insolvency, moratorium, reorganization or other Laws of general application relating to or affecting creditors’ rights generally. Seller Parent has on behalf of each Seller the power and authority to make the representations and warranties and enter into the covenants contained herein.

(b)    Each Seller Party has all necessary corporate power and authority to execute, deliver and perform its obligations under the Ancillary Agreements(s) to which it is a party, and the execution and delivery of such agreement(s) and the performance of all of its obligations thereunder will prior to the Closing have been duly authorized by each such Seller Party. The signing, delivery and performance by each Seller Party of the Ancillary Agreement(s) to which it is a party are not prohibited or limited by, and shall not result in a material breach of

 

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or a material default under, any provision of the Organizational Documents of such Seller Party, or of any material Contract binding on such Seller Party, or of any applicable Order, and shall not result in any Lien on any of the Acquired Assets (other than as may result from the action of the Buyers). The Ancillary Agreements, upon their delivery at or prior to Closing, will have been duly executed and delivered by each Seller Party that is a party thereto and constitute the legal, valid and binding obligation of each Seller Party that is a party thereto, enforceable against each such Seller Party in accordance with their respective terms, except as enforceability may be limited or affected by applicable bankruptcy, insolvency, moratorium, reorganization or other Laws of general application relating to or affecting creditors’ rights generally.

5.3     Organizational Documents and Corporate Records .    Sellers have delivered to Buyer Parent accurate and complete cop