Purchase Agreement - Sanofi-Synthelabo, Institut Pasteur and Bio-Rad Laboratories Inc.
PURCHASE AGREEMENT
BETWEEN:
- SANOFI-SYNTHELABO, a French societe anonyme with
a share capital of 1,461,174,016 Euros, having its principal
office at 174, avenue de France, 75013 Paris ("Sanofi")
represented by Mr. Christian Mignon, duly authorized;
AND:
- INSTITUT PASTEUR, a public interest private foundation,
having its principal office at 28, rue du Docteur
Roux, 75015 Paris ("IP" and, collectively with Sanofi, the
"Sellers"; each, a "Seller"), represented by Mr. Jean Castex,
duly authorized;
AND:
- BIO-RAD LABORATORIES INC., a company incorporated
under the laws of Delaware, having its principal office at 1000
Alfred Nobel Drive, Hercules, California, 94547, represented by
Mr. David Schwartz, duly authorized (the "Purchaser", each of
the Purchaser and either Seller, a "Party" and, collectively,
the "Parties").
WHEREAS:
Pasteur Sanofi Diagnostics S.A. ("PSD" or the "Company")
is a French societe anonyme whose share capital is
held by Sanofi (73.66%) and IP (26.34%);
PSD and its controlled Affiliates (the "Subsidiaries"
and, collectively with the Company, the "Group Companies", as
the same are listed in Exhibit A) are engaged in studying,
researching, producing, selling, distributing in-vitro
diagnostics products, including as licensees, and providing
services in the field of in-vitro diagnostics (such activities,
collectively, the "IVD Activities");
Certain of Sanofi's Affiliates outside of France listed
in Exhibit B (the "Ancillary Asset Sellers") are also
engaged in the IVD Activities and hold and use certain assets in
connection therewith, together with the employment liabilities
relating thereto (described in Schedule 4.20(a) and in Exhibit
C) and are parties to certain contracts pertaining to the IVD
Activities (the "Ancillary Assets");
The Sellers wish to divest, and the Purchaser wishes
to acquire, on the terms and subject to the conditions set forth
in this Agreement, the IVD Activities with a view to the
development and future growth of the IVD Activities consistent
with appropriate social policies;
In furtherance thereof, Sanofi and IP wish to sell,
transfer, assign and deliver, and the Purchaser wishes to
purchase, acquire and assume, on the terms and conditions set
forth in this Agreement, (i) 2,321,153 shares of capital stock
(the "Shares") representing all of the outstanding share
capital of the Company except seven (7) shares held by directors
and employees of the Group Companies and (ii) the Ancillary
Assets;
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2.
Accordingly, the Sellers have agreed to waive, in
connection with the transactions contemplated by this Agreement,
all their respective rights under the Shareholders' Agreement,
which will terminate upon the closing of the sale of the Shares
contemplated hereby.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants, agreements and undertakings contained or
referred to in this Agreement, and subject to the satisfaction
or waiver of the conditions of this Agreement, the Parties
hereby agree as follows.
ARTICLE 1
DEFINITIONS
Capitalized terms used in this Agreement are used as
defined in this Article 1 or elsewhere in this Agreement.
References in this Agreement to numbered Articles, Sections,
Exhibits or Schedules are, unless otherwise specified,
respectively references to Articles and Sections of, and
Exhibits and Schedules to, this Agreement.
"Accounting Group" means the Company, the Subsidiaries and
the Ancillary Assets;
"Accounting Principles" means (a) Sanofi's accounting
practices, conforming to accounting principles generally
accepted in France, as consistently applied by the Sanofi
Group during the 1997 and 1998 fiscal years and as further
described in Schedule 4.7(a)(ii) and (b) the accounting
practices specific to the IVD Activities as set forth in
Schedule 4.7(a)(iii);
"Affiliate" means, with respect to any Party, any
Entity controlling, controlled by, or under common control with
said Party, in all cases directly or indirectly; for purposes of
this definition "control" shall have the meaning set forth in
Article 355-1 of French law no. 66-537 of July 24, 1966 relating
to commercial companies;
"Ancillary Asset Employees" has the meaning set forth
in Section 7.1;
"Ancillary Asset Purchase Price" means, in the aggregate,
thirty four million two hundred nineteen thousand (34,219,000)
French Francs, i.e., US$ five million three hundred forty-two
thousand three hundred seventy-four (5,342,374), corresponding
to the aggregate net book value, as of December 31, 1998, of
the assets included in the Ancillary Assets, after deduction
of the Ancillary Asset Employees liabilities recorded in the
Ancillary Asset Sellers' books as of May 31, 1999 and
allocated among the Ancillary Assets as set forth in Exhibit C;
"Ancillary Asset Sellers" has the meaning ascribed to
such term in the preamble hereof;
"Ancillary Assets" has the meaning ascribed to such
term in the preamble hereof; it being specified that the net
book value of the assets included in the Ancillary Assets shall
exceed the amount (in absolute terms) of the employment
liabilities relating to the Ancillary Asset Employees;
"Business" has the meaning set forth in Section 5.7(a);
"Business Day" means any day other than a Saturday or
Sunday or other day that commercial banks generally are closed
in France and, for the purposes of Article 7 only, in France and
any other jurisdiction from or to or through which a payment is
to be made in connection with the transactions described in such
Article;
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3.
"Calculation Method" means the method used for the
calculation of the Consolidated Reference Net Worth, as set
forth in Exhibit D;
"Change of Control Contracts" has the meaning set
forth in Section 5.2;
"Claim" has the meaning set forth in Section 8.2;
"Closing" has the meaning set forth in Section 9.1(a);
"Closing Date" has the meaning set forth in Section 9.1(a);
"Closing Date Amount" has the meaning set forth in Section 6.1(b);
"Closing Date Calculation" means the method used for
the calculation of the Consolidated Closing Date Net Worth, as
set forth in Exhibit E;
"Company" has the meaning ascribed to such term in
the preamble of this Agreement;
"Confidentiality Agreement" has the meaning set forth
in Section 10.2;
"Consolidated Financial Statements", in respect of
any fiscal year, means the consolidated financial statements
(i.e., the balance sheet and the income statement) of the Group
Companies, in respect of such fiscal year, prepared in
accordance with the Accounting Principles;
"Consolidated 1998 Financial Statements" means the
Consolidated Financial Statements, as of and for the fiscal year
ended, December 31, 1998; it being specified that such financial
statements were derived from the consolidated financial
statements of the Sanofi Group for 1998, audited by Ernst &
Young;
"Consolidated EBITDA" means the Earnings before
Interest, Taxes, Depreciation and Amortizations of the
Accounting Group, established in accordance with the Accounting
Principles, pursuant to the calculation method set forth in
Exhibit G;
"Consolidated Closing Date Financial Statements"
means the Consolidated Financial Statements prepared in
accordance with the provisions of Section 2.1.3(b), as of August
31, 1999 or September 30, 1999, as the case may be, and for the
eight-(8-) or nine-(9-) month period then ended, as applicable;
"Consolidated Closing Date Net Worth" means the
consolidated net worth of the Group Companies, as of August 31,
1999 or September 30, 1999, as the case may be, calculated by
applying the Accounting Principles and the Closing Date
Calculation on the basis of information contained in the
Consolidated Closing Date Financial Statements;
"Consolidated Reference Net Worth" means the amount
set forth in Exhibit D corresponding to an estimate of the
consolidated net worth of the Group Companies, as of August 31,
1999 or, if the Closing Date is not August 31, 1999, as of
September 30, 1999, calculated by applying the Calculation
Method and in accordance with the Accounting Principles;
"Contract" means any contract, agreement, commitment,
undertaking, lease, license, mortgage, bond, note or other
agreement, whether written or oral, creating rights or
obligations, including of a unilateral nature;
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4.
"Cooperation Agreement" means the agreement entitled
Convention de Collaboration between IP and PSD, dated July 11,
1990;
"Entity" means any corporation, company, association,
group, partnership or other entity, incorporated or otherwise;
"Examination Period" has the meaning set forth in
Section 2.1.3(b)(ii)(aa);
"Group Companies" means the Company and the Subsidiaries;
"ICC" has the meaning set forth in Section 11.12;
"Independent Auditor" has the meaning set forth in
Section 2.1.3(b)(iii)(aa);
"Intellectual Property Rights" means (i) all software,
(ii) all patents, patent applications, registered
trademarks, trademark applications, tradenames, service marks,
service mark registrations, service mark applications, service
names, copyrights and copyright applications, (iii) all trade
secrets, processes, know-how and formulae and (iv) all
intellectual property rights to cell lines and monoclonal
antibodies owned by or licensed to the Group Companies, except
those covered by the Cooperation Agreement and the IP License
Agreement and further described in Section 4.10.2 hereof.
Intellectual Property Rights also include Sanofi IVD Patents.
"IP" has the meaning set forth in the second introductory
paragraph of this Agreement;
"IP Patents and Trademarks" has the meaning ascribed
to such term in Section 4.10.2;
"IP License Agreement" means the agreement dated June 30, 1999
and entered into between PSD and IP for clarification
purposes, setting forth a list of patents and know-how licensed
by IP to PSD pursuant to the Cooperation Agreement and the terms
of such licenses;
"IVD Activities" has the meaning set forth in the
preamble to this Agreement;
"Liens" means all liens, pledges, mortgages, charges,
security interests, claims, easements, burdens or other
encumbrances;
"Loss" has the meaning set forth in Section 8.1(a);
"Net Closing Date Financial Indebtedness" means the
sum, as of the Closing Date, as stated in the Consolidated
Closing Date Financial Statements, of all amounts (except trade
receivables) owed by the Group Companies to third party lenders
or to the Sellers or their Affiliates (other than the Group
Companies) under a loan or a line of credit after deduction of
(i) any amounts (except trade receivables) owed by such third
party lenders, the Sellers or their Affiliates to the Group
Companies under a loan or a line of credit and (ii) any cash
balance or cash equivalents on hand or on deposit;
"Net Preliminary Financial Indebtedness" means the
sum of all amounts (except trade receivables) owed by the Group
Companies to third party lenders or to the Sellers or their
Affiliates (other than the Group Companies) under a loan or a
line of credit, after deduction of (i) any amounts (except trade
receivables) owed by such third party lenders, the Sellers or
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5.
their Affiliates to the Group Companies under a loan or a line
of credit and (ii) any cash balance or cash equivalents on hand
or on deposit, on the tenth Business Day preceding the Closing
Date and notified to the Purchaser no later than three (3)
Business Days prior to the Closing Date;
"Notice of Objection" has the meaning set forth in
Section 2.1.3(b)(ii)(bb);
"Permitted Encumbrances" shall mean any (i) non material
easements and security attachments on non material assets and
(ii) Liens that will be released before Closing;
"Preliminary Amount" has the meaning set forth in
Section 6.1(b); it being specified that this amount may not
exceed US$ two hundred and ten million (210,000,000);
"Proforma 1998 Financial Statements" means the balance sheet
and the income statement for the Accounting Group obtained
by combining (i) the consolidated financial statements
of the Group Companies prepared in accordance with the
Accounting Principles and (ii) the assets, liabilities, income
and expense relating to the Ancillary Assets, as of, and for the
fiscal year ended, December 31, 1998, as referred to in the
letters of Ernst & Young dated April 22, 1999, attached hereto
as Exhibit F; it being specified that such financial statements
were derived from the consolidated financial statements of the
Sanofi Group for 1998, audited by Ernst & Young.
"PSD" has the meaning ascribed to it in the preamble hereof;
"Purchaser" has the meaning set forth in the third
introductory paragraph hereof;
"Purchaser's Auditor" has the meaning set forth in
Section 2.1.3(b)(ii)(aa);
"Real Estate" has the meaning set forth in Section 4.8(a);
"Sanofi" has the meaning set forth in the first introductory
paragraph hereof;
"Sanofi Group" means, collectively, Sanofi and its Affiliates
(excluding the Group Companies);
"Sanofi IVD Patents" has the meaning set forth in Section 5.6;
"Sellers" has the meaning set forth in the second introductory
paragraph hereof;
"Sellers' Auditor" has the meaning set forth in Section 2.1.3(b)(i);
"Share Purchase Price" means US$ two hundred and ten
million (210,000,000) less the Ancillary Asset Purchase Price
and the Preliminary Net Financial Indebtedness; it being
specified that the Share Purchase Price may not be increased and
that the sum of the Share Purchase Price, as may be adjusted
pursuant hereto, the Ancillary Asset Purchase Price, as may be
adjusted pursuant hereto and the Closing Date Amount shall not
exceed US$ 210,000,000;
"Share Purchase Price Adjustment" has the meaning set
forth in Section 2.1.3(a);
"Shareholders' Agreement" means the agreement entered
into between Sanofi and IP with respect to the Company dated
July 11, 1990;
"Shares" has the meaning set forth in the preamble hereof;
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6.
"Subsidiaries" means the companies controlled by the Company,
i.e., companies of which the Company holds, directly or
indirectly, more than 50% of the voting rights;
"12 Month EBITDA" has the meaning set forth in Section 4.7(c) hereof;
"Taxes" means all French and foreign taxes, assessments,
social charges, duties, fees or other governmental
charges, taxes imposed on or measured by income, taxes based on
employment (including amounts withheld from employees'
compensation, including but not limited to social security
contributions) and any other taxes imposed on or measured by
property, franchise, sales, customs, gross receipts, profits,
licenses, premium, withholding, capital, general corporate,
whether imposed by any national state, government or any
political subdivision or municipality thereof, including any
interest, penalty or addition thereto;
"US Subsidiaries" has the meaning ascribed to such term in
Section 4.12(a).
ARTICLE 2
SALE AND PURCHASE OF THE SHARES AND ANCILLARY ASSETS
2.1 The Shares
2.1.1 Sale and Purchase of the Shares
Subject to the terms and conditions of this Agreement,
each Seller agrees to sell, transfer, assign and deliver to the
Purchaser, and the Purchaser agrees to purchase and acquire (or
cause any Entity designated by it pursuant to Section 11.3 to
purchase and acquire) from each of the Sellers the Shares that
it holds, free and clear of all Liens of any nature whatsoever,
together with all rights attaching thereto.
2.1.2 Share Purchase Price
The Shares shall be sold in consideration for the
Share Purchase Price as such price may be adjusted pursuant to
the provisions of Section 2.1.3.
On the Closing Date, the Purchaser (or its designee)
shall pay and allocate the Share Purchase Price among the
Sellers prorata to the respective number of Shares sold by each
of them.
Such payment shall be made by means of wire transfer,
for value on the Closing Date.
2.1.3 Share Purchase Price Adjustment
(a) Definition
The Share Purchase Price shall be reduced, as the case
may be, in accordance with the following provisions (the "Share
Purchase Price Adjustment"):
(i) In the event that the amount of the Consolidated
Closing Date Net Worth is less than the
Consolidated Reference Net Worth, the Share
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7.
Purchase Price shall be reduced by an amount
equal to the difference between these two
amounts;
(ii) In the event that the Net Preliminary Financial
Indebtedness is less than the Net Closing Date
Financial Indebtedness, the Share Purchase Price
shall be reduced by an amount equal to the
difference between these two amounts.
(b) Determination of the Share Purchase Price Adjustment
(i) Preparation of the Consolidated Closing Date
Financial Statements:
No later than sixty (60) days after the Closing
Date, Sanofi shall deliver to the Purchaser (x)
the audited Consolidated Closing Date Financial
Statements, (y) a report from Ernst & Young (the
"Sellers' Auditor") with respect thereto and
(z) an explanation of their calculation of the
Share Purchase Price Adjustment based on the
Consolidated Closing Date Financial Statements
and the Closing Date Calculation.
To that effect, the Purchaser shall ensure the
cooperation of the Group Companies with the
Sellers' Auditor and shall, in particular, cause
the Group Companies to provide the Sellers'
Auditor access to all documents, books, records,
data and other information of the Group Companies
necessary in the reasonable opinion of the
Sellers' Auditor.
(ii) Review of the Consolidated Closing Date Financial
Statements:
(aa) The Purchaser, assisted by PGA - Arthur Andersen
(the "Purchaser's Auditor"), shall have a
period of sixty (60) days from the date of
receipt of the documents referred to in Section
2.1.2(b)(i) (the "Examination Period") to
review such documents, conduct its own audit of
the Consolidated Closing Date Financial
Statements applying the Accounting Principles and
notify to Sanofi and to the Sellers' Auditor (the
"Notice of Objection") that it disagrees with
the Consolidated Closing Date Financial
Statements and the calculation of the Share
Purchase Price Adjustment by Sanofi and the
Sellers' Auditor, it being specified that (i) the
opinion of the Purchaser and the Purchaser's
Auditor on the Share Purchase Price Adjustment
shall be based on the Closing Date Calculation;
(ii) the amount of goodwill may not be challenged
by the Purchaser's Auditors; and (iii) each such
disagreement may not involve amounts of less than
five hundred thousand (500,000) French Francs per
line item of the Consolidated Closing Date
Financial Statements, and in the aggregate three
million (3,000,000) French Francs. If the
aggregate amount is reached, the adjustment will
be calculated for the entire amount thereof.
(bb) In the event of such a disagreement, the
Purchaser shall send a Notice of Objection to
Sanofi and the Sellers' Auditor, no later than on
the last day of the Examination Period. Any
failure by the Purchaser to send a Notice of
Objection to Sanofi by such date shall mean that
the Purchaser has definitively accepted, without
reservation, all of the terms of the Consolidated
Closing Date Financial Statements, the Closing
Date Calculation and the amount of the Share
Purchase Price Adjustment as calculated by Sanofi
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8.
and the Sellers' Auditor, and such Consolidated
Closing Date Financial Statements and such amount
shall then become final and binding on the
Parties.
(cc) The Notice of Objection, if any, shall
specifically mention each of the proposed
corrections to be made to the Consolidated
Closing Date Financial Statements, the Closing
Date Calculation and the Share Purchase Price
Adjustment, and shall state the reasons therefor.
All items of the Consolidated Closing Date
Financial Statements and the Closing Date
Calculation not objected to by the Purchaser in
the Notice of Objection shall be deemed to have
been accepted by the Purchaser and shall be final
and binding on the Parties and the Independent
Auditor (as hereinafter defined).
(dd) In the event that a Notice of Objection is sent
to Sanofi, Sanofi and the Purchaser shall
promptly attempt to reach agreement on the
portion of the Consolidated Closing Date
Financial Statements objected to by the Purchaser
and the Share Purchase Price Adjustment
.
(iii) Independent Determination of the Share Purchase
Price Adjustment:
(aa) In the event that no agreement has been reached
between the Parties thirty (30) days after the
date of receipt by Sanofi of the Notice of
Objection, those points on which there is
disagreement shall, at the request of either of
the Parties, be submitted to Deloitte Touche
Tomatsu (the "Independent Auditor"), who shall
act as an expert in accordance with the
provisions of Article 1592 of the French Civil
Code.
Each Party hereby confirms that neither it nor
any of its Affiliates has, or, to its best
knowledge, expects to have in the near future,
any relationship with the Independent Auditor
(anywhere in the world) which could reasonably be
considered to cause a potential conflict of
interest.
If the Independent Auditor does not accept its
appointment or is prevented from carrying out its
duties, the Parties shall promptly meet to agree
on a replacement and each Party may, at any time,
pursuant to a refere proceeding, request the
President of the Commercial Court of Paris to
appoint the Paris office of another accounting
firm of international reputation meeting the
foregoing requirement of independence as
Independent Auditor, preferably chosen among
PriceWaterhouseCoopers or KPMG.
(bb) The Independent Auditor shall perform such
procedures as it considers appropriate to form an
independent opinion on the components of the
Consolidated Closing Date Financial Statements,
the Closing Date Calculation and the final
calculation of the Share Purchase Price
Adjustment which were not agreed upon between the
Parties. In making its determinations, the
Independent Auditor shall apply the Accounting
Principles and the Calculation Method.
The Parties shall use their best efforts to cause
the Independent Auditor to issue a report setting
forth the final calculation of the Share Purchase
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9.
Price Adjustment in accordance with this Section
2.1.2 within thirty (30) days from the date of
the appointment of the Independent Auditor. The
Independent Auditor's calculation of the Share
Purchase Price Adjustment shall be final and
binding on the Parties.
(cc) Each of Sanofi and the Purchaser shall use its
respective best efforts to ensure that the
Sellers' Auditor and the Purchaser's Auditor
shall cooperate with the Independent Auditor,
including by granting access to all relevant
working papers and files. The Purchaser shall
further ensure the cooperation of the Group
Companies with the Independent Auditor and shall,
in particular, cause the Group Companies to give
the Independent Auditor access to all relevant
documents, books, records, data and other
information of the Group Companies.
(dd) The Independent Auditor's fees and disbursements
shall be borne equally by the Sellers on one hand
(and, among the Sellers, in proportion to the
respective number of Shares sold by each of them)
and the Purchaser on the other hand.
(c) Payment of the Share Purchase Price Adjustment
In the event of a Share Purchase Price Adjustment
resulting in a reduction of the Share Purchase Price, each
Seller shall pay to the Purchaser a portion of the Share
Purchase Price Adjustment, corresponding to the proportion of
the respective number of Shares sold by each of them.
Such payment shall be made:
- within fifteen (15) days after the Share Purchase
Price Adjustment is finally determined as
provided above;
- by transfer of immediately available funds in
French Francs, to an account designated by the
recipient(s) thereof.
2.2 Ancillary Assets
2.2.1 Sale and Purchase of the Ancillary Assets
Subject to the terms and conditions of this Agreement,
Sanofi undertakes to cause the Ancillary Asset Sellers to sell,
transfer, assign and deliver to the Purchaser and the Purchaser
agrees to purchase and acquire (or cause any Entity(ies)
designated by it and agreed by the Sellers to purchase and
acquire) from them and assume, the Ancillary Assets, free and
clear from all Liens of any nature whatsoever, except for
Permitted Encumbrances.
2.2.2 Ancillary Asset Purchase Price
Each of the Ancillary Assets shall be sold in consideration
for the relevant Ancillary Asset Purchase Price, as may be
adjusted pursuant to the provisions of Section 2.2.3.
On the Closing Date or, in respect of those Ancillary
Assets subject to prior reorganization as contemplated by
Section 7.3(b) or whose transfer shall not have received all
required regulatory approvals prior to the Closing Date, on the
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10.
relevant subsequent date of transfer thereof, the Purchaser (or
its designee(s)) shall pay the Ancillary Asset Purchase Price in
respect of any transferred Ancillary Asset to the relevant
Ancillary Asset Seller or to Sanofi acting on behalf of the
relevant Ancillary Asset Seller.
All such payments shall be made by means of wire
transfer, for value on the Closing Date or, as the case may be,
on the relevant subsequent closing date to be agreed upon
between the Parties. Any such payments made in respect of
Ancillary Assets shall be made in French Francs or, if
applicable law so requires or if the Purchaser has designated an
Entity to purchase the relevant Ancillary Assets which is
located in the same country as the relevant Ancillary Asset
Seller, in the currency of the country in which the relevant
Ancillary Asset Seller is located. Amounts to be paid in a
currency other than French Francs, if applicable, shall be
calculated by applying (i) the applicable indicative exchange
rate published by the Bank of France for the tenth (10th)
Business Day preceding the relevant payment date, a copy of
which the Sellers shall communicate to the Purchaser and (ii)
the parity between French Francs and Euros.
2.2.3 Ancillary Asset Purchase Price Adjustment
The Ancillary Asset Purchase Price relating to each
Ancillary Asset shall be reduced or increased, as the case may
be, in accordance with the following provisions; provided,
however, that any increase in the Ancillary Asset Purchase Price
pursuant to this Section 2.2.3 shall be limited to the amount of
the Share Purchase Price Adjustment, if any, that may be finally
determined pursuant to Section 2.1.3 above. In the event that
such increase shall exceed the amount of the Share Purchase
Price Adjustment, such excess shall be deemed to reduce the
Share Purchase Price, for purposes of the allocation of the
Purchase Price among the Sellers and the Ancillary Asset
Sellers.
Within fifteen (15) days from the Closing Date or, as
the case may be, from the subsequent date of transfer of the
relevant Ancillary Asset agreed upon between the Parties, Sanofi
shall notify to the Purchaser (or its designee(s)) the net book
value of the relevant Ancillary Asset and the related Ancillary
Asset Employers' liabilities as stated in the relevant Ancillary
Asset Seller's books, as at the date of transfer of such
Ancillary Asset and Ancillary Asset Employers, converted, as the
case may be, into French Francs, at the exchange rate referred
to in Section 2.2.2, as applicable on such date.
If such net book value exceeds the relevant Ancillary
Asset Purchase Price, the Purchaser (or its designee(s)) shall
pay to the relevant Ancillary Asset Seller the amount of the
difference between these two amounts.
If such net book value is less than the relevant
Ancillary Asset Purchase Price, the relevant Ancillary Asset
Seller shall refund to the Purchaser (or its designee(s)) the
amount of the difference between these two amounts.
The adjustments contemplated by this Section 2.2.3
shall be calculated by Sanofi and, at the request of the
Purchaser, may be subject to a contradictory audit pursuant to
the procedure described in Section 2.1.3 above applied mutatis
mutandis; provided, however, that the review period available to
each Party's auditor shall be limited to thirty (30) days.
The payments provided in the two paragraphs above shall be made:
- within fifteen (15) days after the net book value
of the relevant Ancillary Asset has been notified
to the Purchaser (or its designee(s)) by Sanofi;
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11.
- by transfer of immediately available funds in the
currency used for the payment of the relevant
Ancillary Asset Purchase Price, to an account
designated by the recipient thereof.
ARTICLE 3
REPRESENTATIONS OF THE PURCHASER
The Purchaser hereby makes and gives the following
representations and warranties for the benefit of the Sellers,
which shall be accurate in all material respects as of the date
hereof and (except as otherwise specifically provided therein)
as of the Closing Date, as though restated on such date.
3.1 Organization, Authority and Validity
(a) The Purchaser is (and its designee(s), if any, will be)
a corporation duly organized and validly existing under
the laws of Delaware (United States of America). The Purchaser
has the corporate power and authority to enter into this
Agreement and to carry out its obligations hereunder.
(b) The execution of this Agreement and the consummation of the
transactions contemplated hereby have been duly authorized
by the competent corporate bodies of the Purchaser (and will
have been so authorized by the competent corporate body of
its designee(s)), and no other corporate action on the part
of the Purchaser (or any such designee(s)) is (or will be)
necessary to authorize the execution of this Agreement or
the consummation of any of the transactions contemplated hereby.
(c) This Agreement has been duly executed by the Purchaser and
constitutes a legal, valid and binding obligation of the
Purchaser, enforceable against it in accordance with its terms.
3.2 No Breach
Neither the execution of this Agreement, nor the performance by
the Purchaser of its obligations hereunder, nor the consummation
of the transactions contemplated hereby does or will:
(i) conflict with or violate any provision of the by-
laws of the Purchaser or any other corporate governance
document of the Purchaser;
(ii) violate, conflict with or result in the breach or
termination of, or constitute a default or an event of
default under, the terms of any Contract to which the
Purchaser is a party; or
(iii) constitute a violation by the Purchaser of any laws or
regulations.
3.3 Consents
The Purchaser is not required to obtain any consent in
connection with the consummation of any of the transactions
contemplated hereby.
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12.
3.4 Brokers
All negotiations relating to this Agreement and the transactions
contemplated hereby have been carried out without the intervention
of any person acting on behalf of the Purchaser in such manner as
to give rise to any valid claim against any of the Sellers or any
of their Affiliates for any broker's or finder's fee or similar
compensation in connection with the transactions contemplated hereby.
ARTICLE 4
REPRESENTATIONS OF THE SELLERS
The Sellers hereby make and give the representations and warranties
contained in Sections 4.4.3, 4.5, 4.6 and 4.15 for the benefit of
the Purchaser. In addition, Sanofi hereby makes and gives, for the
benefit of the Purchaser, the representations and warranties contained
in Sections 4.1.1, 4.2.1, 4.3.1, 4.4.1, 4.7 through 4.14 and 4.16
through 4.26 (with the exception of those contained in Section 4.10.2),
and IP makes and gives, for the benefit of the Purchaser, the
representations and warranties contained in Sections 4.1.2, 4.2.2,
4.3.2, 4.4.2 and 4.10.2. The representations and warranties contained
in this Article 4 shall be accurate in all material respects as of
the date hereof and (except as otherwise specifically provided therein)
as of the Closing Date, as though restated on such date.
4.1 Organization, Authority and Validity
4.1.1 (a) Sanofi is a corporation duly organized and validly existing
under the laws of France. Sanofi has the power
and authority to enter into this Agreement and to carry out
its obligations hereunder.
(b) The execution of this Agreement and the consummation of
the transactions contemplated hereby have been duly
authorized by the competent corporate bodies of Sanofi, and
no other corporate action on the part of Sanofi is necessary
to authorize the execution of this Agreement or the
consummation of any of the transactions contemplated hereby.
(c) This Agreement has been duly executed by Sanofi and
constitutes a legal, valid and binding obligation of Sanofi,
enforceable against it in accordance with its terms.
4.1.2 (a) IP is a public interest private foundation duly organized
and validly existing under the laws of France. IP has
the power and authority to enter into this Agreement and to
carry out its obligations thereunder.
(b) The execution of this Agreement and the consummation of
the transactions contemplated hereby have been duly
authorized by the competent organizational bodies of IP,
and no other action on the part of IP is necessary to
authorize the execution of this Agreement or the
consummation of any of the transactions contemplated hereby.
(c) This Agreement has been duly executed by IP and constitutes
a legal, valid and binding obligation of IP, enforceable
against it in accordance with its terms.
<PAGE>
13.
4.2 No Breach
4.2.1 Except as set forth in Schedule 4.2.1, neither the execution
of this Agreement nor the performance by Sanofi of its obligations
hereunder nor the consummation of the transactions contemplated
hereby does or will:
(i) conflict with or violate any provision of the by-laws
or any other corporate governance document of Sanofi
or of any Group Company; or
(ii) to Sanofi's best knowledge, violate, conflict with or
result in the breach of any Contract to which any Group
Company is a party; or
(iii) violate, conflict with or result in the breach of
any Contract to which Sanofi is a party; or
(iv) constitute a violation by Sanofi or any Group Company
of any laws or regulations;
except for any such matters that would not, either individually
or in the aggregate, have a material adverse effect on the
financial condition of the Group Companies or materially impair
the ability of Sanofi to perform its obligations under this
Agreement.
4.2.2 Except as set forth in Schedule 4.2.2, neither the execution
of this Agreement nor the performance by IP of its obligations
hereunder nor the consummation of the transactions contemplated
hereby does or will:
(i) conflict with or violate any provision of the by-laws
or any other corporate governance document of IP or of
any Group Company; or
(ii) to IP's best knowledge, violate, conflict with or
result in the breach of any Contract to which any
Group Company is a party; or
iii) violate, conflict with or result in the breach of
any Contract to which IP is a party; or
(iv) constitute a violation by IP or any Group Company
of any laws or regulations;
except for any such matters that would not, either individually
or in the aggregate, have a material adverse effect on the
financial condition of the Group Companies or materially impair
the ability of IP to perform its obligations under this
Agreement.
4.3 Consents
4.3.1 No consent is required to be obtained by Sanofi or any
Group Company other than those set forth in Schedule
4.3.1 for purposes of the execution of this Agreement or the
consummation of any of the transactions contemplated herein.
4.3.2 No consent is required to be obtained by IP or any Group
Company other than those set forth in Schedule 4.3.2
for purposes of the execution of this Agreement or the
consummation of any of the transactions contemplated herein.
<PAGE>
14.
4.4 Incorporation, Existence and Authority of the Group Companies
4.4.1 Sanofi owns, either directly or indirectly, the number of
shares in the Company and its Subsidiaries set forth in Schedule 4.4.1.
4.4.2 IP owns, either directly or indirectly, the number of shares
in the Company and its Subsidiaries set forth in Schedule 4.4.2.
4.4.3 (a) Schedule 4.4.3(a) contains an accurate and complete list
of the Group Companies indicating the jurisdiction
of incorporation thereof.
(b) Each of the Group Companies, is duly organized,
and validly existing under the laws of its jurisdiction of
incorporation.
(c) Each of the Group Companies has full power and authority
to own, lease and operate the assets held or used by
it, and carry out its activities in the manner in which
they are currently carried out.
(d) Except as set forth in Schedule 4.4.3(d), none of the
Group Companies currently is the subject of any voluntary or
judicial reorganization proceedings, or similar proceedings
or is undergoing a liquidation.
4.5 Capital Structure
(a) All of the Shares and all of the shares and other equity
interests in the Group Companies are validly issued and
fully paid. Except as set forth in Schedule 4.5(a),
the Shares and all of the shares and other equity
interests in the Subsidiaries are free and clear of all Liens.
(b) The share capital of each of the Group Companies
is set forth in Schedule 4.4.3(a). Except as set forth in
Schedule 4.4.3(a), there are no warrants, subscription, option
or conversion rights or other agreements, securities, or other
commitments, of any nature whatsoever authorized or outstanding
pursuant to which any of the Group Companies is or may become
obligated to issue or sell any shares, warrants or other
securities of any nature whatsoever. Except as set forth in
Schedule 4.4.3(a), the Group Companies do not hold any interest
in any Entity.
4.6 Transferability of the Shares
The Shares represent 99,99% of the share capital of, and of the
voting rights in, the Company. The Shares are owned respectively
by Sanofi and IP, in the respective numbers and proportions as set
forth in Schedule 4.6. Each Seller represents and warrants with
respect to its respective Shares, that the Shares held by it may be
freely disposed by it without any restrictions whatsoever other
than those resulting from the clause d'agrement contained in
Article 10(a) of the by-laws of the Company and that it has agreed to
waive its right of first refusal over the Shares provided under
Section 2.3.1 of the Shareholders' Agreement.
4.7 Financial Statements
(a) The Proforma 1998 Financial Statements are attached hereto
as Schedule 4.7(a)(i). The Proforma 1998 Financial Statements
fairly present, in accordance with the Accounting Principles,
which are attached hereto as Schedule 4.7(a)(ii) and
<PAGE>
15.
4.7(a)(iii), applied on a consistent basis, the financial
condition, assets and liabilities of the Accounting
Group as of December 31, 1998 and for the fiscal year then
ended. As of December 31, 1998, the Group Companies did not
have any material liabilities other than liabilities reflected
or reserved against in the Proforma 1998 Financial Statements
or disclosed in Schedule 4.7(a)(iv).
(b) Except as set forth in Schedule 4.7(b)(ii),the Group
Companies, since December 31, 1998, (i) have conducted
their businesses only in the ordinary course of business in a
manner consistent with past practice, have not changed the
senior management referred to in Schedule 4.7(b)(i) and
have not taken any of the actions described in Section 5.1
below and (ii) have not incurred any liability or financial
obligation except liabilities (aa) incurred in the ordinary
course of business consistent with past practice, or
(bb) individually amounting to no more than FRF. 500,000,
or (cc) specifically reserved against (whether in a general
reserve account or in a specific reserve account) or otherwise
reflected in the Consolidated 1998 Financial Statements.
All reserves made in the Proforma 1998 Financial Statements
are adequate in all material respects.
(c) The Consolidated EBITDA of the Accounting Group for the
12-month period ended as of June 30, 1999 (the "12-Month
EBITDA"), as calculated by Ernst & Young, shall be not
less than US$ 7,000,000 (once converted from French Francs
(until December 31, 1998) or Euros (from January 1, 1999)
at the weighted average exchange rate between FRF or Euros
and US$ for each monthly period included in such 12-month
period). For purposes of Article 8 hereof, any shortfall
between the 12-Month EBITDA and the above-referred amount
shall entitle the Purchaser to indemnification in the amount
of five (5) times such shortfall, subject to the provisions
of Article 8 hereof (including any limitations contained
therein).
4.8 Real Estate
(a) A complete list of all real estate owned or leased by the
Group Companies is attached hereto as Schedule 4.8(a),
including all land and buildings used for purposes of
carrying out the activities of the Group Companies (all such
real estate, the "Real Estate").
(b) Except as set forth in Schedule 4.8(b), the Real Estate
owned by the Group Companies is free and clear of all
Liens (other than Permitted Encumbrances) which may
significantly affect their value or use.
(c) Except as set forth in Schedule 4.8(c), the Real Estate
not owned by the Group Companies is leased pursuant to
valid lease agreements. None of the Group Companies have
been notified that they are in breach of any of these lease
agreements which permits the Group Companies to continue
to use the leased Real Estate in the same manner as is
currently being used.
4.9 Movable Property, Businesses ("Fonds de Commerce") and Inventory
(a) Except as set forth in Schedule 4.9(a), all movable
property, installations and equipment used by the Group
Companies to conduct their businesses are either (i) fully
owned by the Group Companies and are not the subject of
any Liens other than Permitted Encumbrances or (ii) are
used by the Group Companies under the terms of a valid lease,
operating lease (location financiere) or capital lease
(credit bail) agreement. Except as reflected in the Financial
Statements of the Group Companies (and particularly in the
reserves accounted for by the Group Companies), substantially
all movable property, installation and equipment used by the
Group Companies to conduct their businesses are in good
operating condition and repair, ordinary wear and tear
excepted, and are fit for the purposes for which they are
<PAGE>
16.
currently being used in the Group Companies businesses.
There exists no restriction on the use or transfer of
the movable property, installations and equipment used
by the Group Companies, except for regulatory requirements
as well as third parties rights under lease or operating
lease agreements.
(b) Except as set forth in Schedule 4.9(b), the businesses
("fonds de commerce") of the Group Companies have in
all material respects been operated in accordance with
currently applicable laws and regulations. Except as set
forth in Schedule 4.9(b), the Group Companies have full
ownership of such businesses, which are not subject to
any Liens other than Permitted Encumbrances. The
businesses ("fonds de commerce") of the Group Companies
have sufficient assets to carry on their respective businesses
as presently conducted.
(c) Except as reflected in the Financial Statements of the
Group Companies (and particularly in the specific
reserves accounted for by the Group Companies (whether in a
general reserve account or in a specific reserve account)),
all product inventory held by the Group Companies is in good,
marketable and usable condition, free from all Liens, and
is in conformity with warranties customarily given to
purchasers of the relevant products. All inventory is managed
in a manner consistent with past practice.
4.10 Intellectual Property Rights
4.10.1 (a) Schedule 4.10.1(a) sets forth (i) a complete list of all
patents, patent applications, registered trademarks,
trademark applications owned by the Group Companies [and]
(ii) a complete list of all licenses granted to the Group
Companies in connection with patents, patent applications,
registered trademarks, trademark applications, know-how
and intellectual property rights to monoclonal antibodies,
except for those covered by the Cooperation Agreement and
the IP License Agreement, (iii), for information purposes
only, a list of certain cell lines and monoclonal antibodies
registered with ATCC or other similar scientific depositary
bodies, all of which are owned or validly used by the Group
Companies, and (iv) Schedule 5.6 sets forth all intellectual
property rights owned by Sanofi and used by the Group
Companies in their IVD Activities, and there is no other
intellectual property of Sanofi required by the Group
Companies for them to conduct the IVD Activities, as
currently being conducted.
(b) Except as set forth in Schedule 4.10.1(b) (and except for
the Sanofi IVD Patents), each of the Group Companies
(or Sanofi for the Sanofi IVD Patents) either owns or uses
pursuant to license agreements the Intellectual Property
Rights and none of the Intellectual Property Rights owned
by the Group Companies (or by Sanofi for Sanofi IVD Patents)
are subject to any Liens or have been revoked or held invalid
or unenforceable or have become abandoned as a result of
non-compliance with the formalities required to maintain them
in full force and effect or as the result of the failure to
use such Intellectual Property Rights;
(c) Except as set forth in Schedule 4.10.1(c) and except for
Sanofi IVD Patents, the Group Companies (or Sanofi
for Sanofi IVD Patents) have good and valid title to the
Intellectual Property Rights owned by them;
(d) Except as set forth in Schedule 4.10.1(d) (and except
for the Sanofi IVD Patents following transfer thereof to
the Group Companies), none of the Group Companies (or
Sanofi for the Sanofi IVD Patents, subject to the provisions
of Section 5.6 hereof) has granted, or agreed to grant, to
any third party any license or other right to use any of the
Intellectual Property Rights;
(e) Except as set forth in Schedule 4.10.1(e), all of the
Intellectual Property Rights used but not owned by the Group
Companies are used by the Group Companies pursuant to legally
<PAGE>
17.
valid license agreements and none of the Group Companies are
in material breach under any of these agreements, no
proceeding or claim is currently outstanding or asserted
against any of the Group Companies (or Sanofi for the
Sanofi IVD Patents) in respect of the Intellectual Property
Rights and none of the Group Companies (or Sanofi for the
Sanofi IVD Patents) have received a notice from a third party
to the effect that any product that the Group Companies make,
use, sell or distribute, infringes any trademark, trade name,
copyright, patent, trade secret or similar legally protected
right of such third party. In the reasonable opinion of Sanofi,
based on specific studies having been conducted by the Group
Companies, the HIV and Hepatitis viruses products currently
manufactured and/or sold by the Group Companies do not
infringe any intellectual property right legally protected
of a third party.
(f) Except as set forth in Schedule 4.10.1(f), the Group Companies
are not required by Contract or otherwise to make any
payments in connection with the ownership or use of the
Intellectual Property Rights other than (aa) fees payable to
their intellectual property counsels and to competent
authorities to maintain their Intellectual Property Rights in
full force and effect and (bb) with respect to Intellectual
Property Rights not owned by them, the royalties and cash
payments provided in the license agreements listed in Schedule
4.10.1(a)(ii);
(g) Except as set forth in Schedule 4.10.1(g), the consummation
of the transactions contemplated hereby will not alter or
impair any of the Group Companies' rights under license
agreements pertaining to the Intellectual Property Rights,
except for such breaches, alterations or impairments that
would not, either individually or in the aggregate, have a
material adverse effect on the financial condition of the
Group Companies taken as a whole.
4.10.2 (a) Schedule 4.10.2(a)(i) sets forth a complete list of the
patents, patent applications, registered trademarks,
trademark applications and know-how owned in whole or in
part by IP and currently used by all or certain of the Group
Companies or that the Group Companies are entitled to use, in
each case in the field of IVD Activities, pursuant to the
Cooperation Agreement and the IP License Agreement (the
"IP Patents and Trademarks"); it is specified that those of
the IP Patents and Trademarks listed in Schedule 4.10.2(a)(ii)
are licensed to the Group Companies on a non-exclusive basis;
(b) Except as set forth in Schedule 4.10.2(b), IP owns and has
good and valid title to the IP Patents and Trademarks, or is
the valid co-owner of the IP Patents and Trademarks and is
entitled, pursuant to a management agreement relating thereto,
to grant licenses, including on an exclusive basis, to
third-parties with respect to such co-owned IP Patents and
Trademarks;
(c) Except as set forth in Schedule 4.10.2(c), none of the IP
Patents and Trademarks are subject to Liens or have been
revoked or held invalid or unenforceable or have become
abandoned as a result of non-compliance with the formalities
required to maintain them in full force and effect; it is
specified that Schedule 4.10.2.(c) may be amended with respect
to trademarks by the Sellers until the Closing Date;
(d) Except as set forth in Schedule 4.10.2(d), IP has not granted
or agreed to grant to any third party any license or
other right to use for the same applications those of the IP
Patents and Trademarks licensed to the Group Companies on an
exclusive basis nor have IP or other co-owners of IP Patents
and Trademarks retained the right to use, for commercial
purposes, such IP Patents and Trademarks;
(e) Except as otherwise set forth in Schedule 4.10.2(e), no
proceeding or claim is currently outstanding against IP
or the Group Companies in respect of the IP Patents
and Trademarks.
<PAGE>
18.
4.10.3 Except as otherwise provided in Sections 4.10.1 and 4.10.2 and
as may result out of patent applications not published as of
the date of signing hereof, to the best of Sanofi's knowledge
after diligent inquiry, the Group Companies hold the Intellectual
Property Rights and the IP Patents and Trademarks necessary
to conduct the IVD Activities as currently being conducted.
4.11 Loans
(a) Except as set forth in Schedule 4.11(a), none of the Group
Companies have made any loans to any individual or to
any legal entity that are outstanding as of the date hereof,
with the exception of loans to employees or bodies responsible
for the collection of employers' construction fund
contributions and loans granted to other Group Companies.
(b) Except as set forth in Schedule 4.11(b), none of the Group
Companies is in default with respect to any material
term or condition of any indebtedness incurred vis-a-vis
third parties outstanding as of the date hereof.
4.12 Tax, Social Security and Customs
(a) For purposes of Sections 4.12, 4.18 and 4.20, the
term "Group Companies" shall be deemed to exclude Group
Companies organized under the laws of any State of the United
States of America, i.e., Sanofi Diagnostics Pasteur, Inc.,
Genetic Systems Corporation, Blood Virus Diagnostics, Inc.
and Respiratory Diagnostics, Inc., (the "US Subsidiaries") in
respect of which the representations and warranties set forth
in Schedule 4.12(a) are made and given.
(b) Except as set forth in Schedule 4.12(b), (i) the Group
Companies have filed on a timely basis with the competent
authorities any and all returns in respect of Taxes which
they were required to file and such returns were true and
accurate in all material respects when filed, (ii) all Taxes
required to be paid by the Group Companies that were due and
payable prior to the date hereof have been paid by the Group
Companies and (iii) the Group Companies have made adequate
provisions in the Proforma 1998 Financial Statements, in
accordance with the Accounting Principles, for the payment of
all Taxes that were not due and payable prior to January 1,
1999 but for which they may be liable in respect of periods
ending prior to January 1, 1999, regardless of whether the
liability for such Taxes is disputed.
(c) Except as set forth in Schedules 4.7(a)(iv) and 4.12(b),
there are no Liens for Taxes upon the assets of any of
the Group Companies;
(d) The Group Companies have never been members of any
partnerships, joint ventures or interest groupings
(groupements d'interet economique) under which any of
the Group Companies may be responsible for any tax
obligations of any other person or Entity;
(e) All tax credits, tax losses reported in the tax returns
are valid and may be taken advantage of by the Group
Companies under currently applicable tax law;
(f) Except as set forth in the schedules to Section 4.7,
the Group Companies have not incurred any Tax liabilities
for the period beginning January 1, 1999 and ending on the
Closing Date other than Tax liabilities incurred in the
ordinary course of their business; and
(g) Except as set forth in Schedule 4.12(c), none of the Group
Companies is the subject of a Tax audit or Tax investigation,
nor have any of the Group Companies received from any Tax
<PAGE>
19.
authority any notice of such an audit or investigation.
No claims for unpaid Taxes, interest or penalties are being
asserted against the Group Companies. No express waiver of
any statute of limitations has been given and is currently
in effect with respect to the assessment of any Taxes against
the Group Companies.
4.13 Insurance
(a) The Group Companies are insured either through group
policies contracted by Sanofi-Synthelabo or policies directly
contracted by them in amounts and against those risks
normally insured against by persons operating similar
businesses of similar sizes in similar locations
(including product liability insurance, motor vehicle
and general liability insurance as well as fire insurance
and insurance of the properties of the Group Companies.
A list of such policies contracted by Sanofi-Synthelabo
is set forth in Schedule 4.13(a). Such insurance policies
are in full force and effect in accordance with their
respective terms and will remain in full force and effect
until the Closing Date.
(b) A list of all material pending claims or disputes in
connection with such insurance policies is attached hereto as
Schedule 4.13(b).
4.14 Contracts
(a) Schedule 4.14(a) contains an accurate and complete list of
all Contracts (except license agreements pertaining to
Intellectual Property Rights, a list of which is set forth
in Schedules 4.10.1(a) and 4.10.1(d)) to which any of the
Group Companies is a party that (i) involve the obligation
(including contingent obligations) by or to any of the Group
Companies to pay amounts in excess of one million (1,000,000)
French Francs in any year (on the basis of the Proforma 1998
Financial Statements) or (ii) were not entered into in the
ordinary course of business of the Group Companies.
All Contracts listed in Schedule 4.14(a) (except for those
entered into by Group Companies located in France or in the
United States of America), (i) in case of fixed term
Contracts, do not exceed two (2) years in duration, (ii) in
case of indefinite term Contracts, may be terminated with no
more than six (6) months of prior notice and (iii) in all
cases, with respect to Contracts involving payments by the
Group Companies, do not represent, individually, post Closing
Date commitments in excess of US$ 250,000 per year.
(b) Except as set forth in Schedule 4.14(b), all Contracts listed
in Schedule 4.14(a) to which a Group Company is a party are
valid, binding and enforceable by one or more of the Group
Companies in accordance with their respective terms and
are in full force and effect, and none of the Group Companies
is in default in any material respect under any of such
Contracts. To the best of Sanofi's knowledge, no other party
to any of such Contracts is in default in any material respect
thereunder. To the best of Sanofi's knowledge, no event has
occurred which, with the passage of time or the giving of
notice or both would constitute a default by the Group
Companies under any such Contracts.
(c) Except as set forth in Schedule 4.14(c), the sale of the
Shares to the Purchaser shall not entitle, pursuant to
any express provision of any Contract listed in Schedule
4.14(a), any other party to such Contracts to request that
they be terminated, modified or renegotiated, as a result
of such sale and, to the best of Sanofi's knowledge, as of
the date hereof, the Group Companies have not received notice
from any party to such Contracts to the effect that such
party has decided to cancel or terminate any such Contract
or exercise any option under any such Contract as a result of
the sale of the Shares.
<PAGE>
20.
(d) The Group Companies have ordered at least U.S.$ five (5)
million of reagents and instrumentation applicable to
the 1999 commitment under the April 30, 1997 Exclusive Dealer
Agreement entered into between the Company and Beckman Coulter,
Inc. By December 31, 1999, the Group Companies will have met
their 1999 commitment under such agreement.
(e) Cumulatively, reagent rental agreements entered into by the
Group Companies are enforceable and have been generally
enforced by the Group Companies so as to maintain
profitability at historical levels.
4.15 Relations with the Sellers
Except as otherwise stated in Schedule 4.15, neither the Sellers,
nor any Affiliate of the Sellers (other than a Group Company), in all
cases either directly or indirectly:
(a) holds any property or rights whatsoever, which are necessary
for the Group Companies to carry out their activities
(other than the IP Patents and Trademarks and the Sanofi
IVD Patents);
(b) is party to any Contracts with any Group Companies nor has
any rights against the Group Companies (other than the
shareholders' rights of the Sellers vis-a-vis the Group
Companies, Sanofi's rights to the Sanofi IVD Patents and IP's
rights under the Cooperation Agreement and the licenses of the
IP Patents and Trademarks to the Group Companies); or
(c) has granted any guarantees or other security interests
to secure any of the Group Companies' undertakings, or
is the beneficiary of any guarantee granted by any of the
Group Companies to secure any of their obligations vis-a-vis
third parties.
4.16 Disputes
Except as set forth in Schedules 4.10.1(e), 4.10.2(g), 4.12(c), 4.13(b),
4.16 and 4.20(e), there are no judicial, administrative or arbitration
proceedings pending against any of the Group Companies, which, if
determined adversely with respect to the relevant Group Company, would
have a material adverse effect on its business condition or the economic
or financial prospects of the Group Companies taken as a whole. Except
as set forth in Schedule 4.16, none of the Group Companies is a
plaintiff in any litigation or proceeding where material counterclaims
have been asserted against a Group Company.
4.17 Compliance with Law
(a) Except as indicated in Schedule 4.17, (i) the Group Companies
possess all permits, certifications and other consents from
governmental or other authorities required to conduct their
respective operations as currently being conducted and (ii)
the Group Companies are currently conducting their respective
businesses in material compliance with these permits and
consents and with all laws, ordinances and regulations which
are currently applicable to them (except for instances of non-
compliance that would not reasonably be expected to have a
material adverse effect on the relevant Group Company),
including but not limited to national, state, local and
foreign environmental, work place safety and employee
benefits laws and regulation.
(b) No proceedings of any nature whatsoever have been undertaken
which may result in the withdrawal, suspension or modification
of any of the consents and permits held by the Group
<PAGE>
21.
Companies and required to conduct the Group Companies'
operations as currently being conducted. Except as set forth
in Schedule 4.17(b), all such permits, certifications and
consents are valid and in full force and effect and will not
be terminated as a result of the sale of the Shares.
(c) Except as set forth in Schedule 4.17(c), none of the Group
Companies has received any notice from governmental or
other authorities alleging any violation of any laws,
ordinances or regulations currently pending, which, if
determined against the relevant Group Company, would have
a material adverse effect on its business condition or the
economic or financial prospects of the Group Companies taken
as a whole.
4.18 Environment
Except as indicated in Schedule 4.18, the Group Companies carry out
their activities in compliance in all material respects with
environmental laws and regulations currently applicable to them.
In particular, the Group Companies have obtained all environmental
authorizations and licenses required for the conduct of their operations
as currently conducted, and the Group Companies comply in all
material respects with said authorizations and licenses. There
have been no releases of hazardous substances (substances
dangereuses pour l'environnement) within the meaning of classes
no. 1170, 1171, 1172 and 1173 of the French decree of May 20,
1953 relating to installations classees from or on the premises
at which the Group Companies operate their business. Except as
indicated in Schedule 4.18, the Group Companies have not
received notice of potential liability, under applicable
environment laws and regulations, with respect to any sites and
the Group Companies are not aware of any present events, facts,
conditions or circumstances which violate environmental laws in
any material respect or which currently form the basis of an
environmental claim arising out of the release of such hazardous
substances with respect to any of the sites in which they
conduct their activities.
4.19 Ancillary Assets
(a) Except as set forth in Schedule 4.19(a) and except for
the transfer to the Purchaser (or its designee(s)) of
local product sanitary registration in respect of products sold
through the Ancillary Assets, the Ancillary Assets are wholly-
owned by the Ancillary Asset Sellers free and clear of all
Liens except for Permitted Encumbrances, and there exists no
restriction on the transfer of the Ancillary Assets.
(b) All of the Ancillary Assets are in a state of good maintenance
and repair and are usable for their intended purpose.
4.20 Labor Matters
(a) Schedule 4.20(a) is a list of employees (representing
approximately 90% of the headcount) of the Group
Companies (including, by way of exception to Section 4.12(a),
the US Subsidiaries) and of the Ancillary Asset Employees,
indicating the current rate of compensation for each such
employee as of May 31, 1999. The representation contained in
this paragraph 4.20(a) with respect to employees of Group
Companies other than those located in France, in the United
States and in Brazil is made for information purposes only and
may not result in indemnification of the Purchaser pursuant to
Article 8 hereof.
(b) Except as set forth in Schedule 4.20(b), the Group Companies
do not participate in or contribute to any retirement plans,
profit-sharing schemes or other optional employee incentive
plans other than those required by applicable laws,
regulations and/or collective bargaining agreements. As
<PAGE>
22.
of the date hereof, the Group Companies have made all required
contributions payable under their respective plans and under
the applicable social security regime.
(c) Except as set forth in Schedule 4.20(c), none of the Group
Companies has concluded any Contracts with any of its
employees which provide, in the event of termination, for a
notice period or payment of an indemnity which exceeds those
provided for by applicable laws, regulations and/or collective
bargaining agreements.
(d) Schedule 4.20(d) sets forth all commitments and undertakings,
outstanding as of the date hereof, made by the Group
Companies (including, by way of exception to Section
4.12(a), the US Subsidiaries) vis-a-vis their former
employees.
(e) Except as set forth in Schedule 4.20(e), none of the Group
Companies has (i) given any undertakings or made any
commitments in connection with any restructuring plan (plan
social) that have not been entirely performed or fulfilled or
(ii) given any undertakings or made any commitments in
connection with a collective dismissal plan (licenciement
collectif).
(f) Except as set forth in Schedule 4.20(f), there is no current
labor litigation involving claims by employees of the
Group Companies. No collective labor disputes, strikes, work
stoppages or other interruption in service or performance due
to collective labor disputes have occurred over the last three
(3) years; and since then, all relationships between the Group
Companies and its employees are generally stable and
satisfactory.
(g) Schedule 4.20(g) describes the particular undertakings
given by the Group Companies (including, by way of
exception to Section 4.12(a), the US Subsidiaries) to their
employees in connection with the transactions contemplated by
this Agreement.
(h) Except as set forth in Schedule 4.20(h), the representations
provided by paragraphs (a), (b), (c), (e), (f) and (g)
of this Section 4.20 apply to the Ancillary Assets Employees.
4.21 Product Liability
(a) Except as set forth in Schedule 4.21(a) and for customary
and limited batch recalls (those related to the lack
of robustness of the biological products or defects in
workmanship and not to defects that would impair the
reliability of a diagnosis and may cause a public health
problem), none of the Group Companies has received any
order from any administrative or judicial authority, or
any request from any professional or consumer body, to
recall any of its products, or to inform its customers
of a defect in any of its products.
(b) Except as set forth in Schedule 4.21(b), no warranties
have been granted by any of the Group Companies with
respect to its products sold or services rendered under the
terms of which any of them would be liable beyond the limits
and periods provided for by law and/or the general conditions
of sale of the Group Companies, as applicable. There are no
outstanding warranty claims against the Group Companies by any
of its customers with respect to the products sold or the
services rendered by the Group Companies.
<PAGE>
23.
4.22 Brokers
All negotiations relating to this Agreement and the transactions
contemplated hereby have been carried out without the intervention
of any person acting on behalf of any of Sanofi or the Group Companies
in such manner as to give rise to any valid claim against any of the
Group Companies or Purchaser for any broker's or finder's fee or similar
compensation in connection with the transactions contemplated.
4.23 No material adverse change
Except for the consequences of termination, if any, of
Change of Control Contracts referred to in Section 5.2 hereof,
between the date hereof and the Closing Date, there shall not
have occurred any event effectively adversely affecting the
financial condition of the Group Companies, taken as a whole, by
more than Euro 39,058,686.
4.24 Year 2000 Compliance
As of the date hereof, the Group Companies have achieved and
performed all the objectives and actions contemplated to be
achieved and performed by them on or prior to the date hereof
pursuant to the Y2K Plans attached as Schedule 4.24 hereto
(except for instances of absence of achievement or performance
which do not have a material adverse effect on the Group
Companies).
4.25 Euro Compliance
As of the date hereof, the Group Companies have achieved and
performed all the objectives and actions contemplated to be
achieved and performed by them on or prior to the date hereof
pursuant to the Euro compliance plans attached as Schedule 4.25
hereto (except for instances of absence of achievement or
performance which do not have a material adverse effect on the
Group Companies).
4.26 Maintenance of Business
Neither of the ten major customers of the Group Companies,
respectively in France and in the United States of America,
nor the ten major suppliers of the Group Companies, respectively
in France and in the United States, have notified any of the Group
Companies within the six-month period immediately preceding the
date hereof of their intent to cease doing business with any of
such companies or to reduce substantially the amount of the business
that such customer is currently doing with any of the Group Companies;
without prejudice to termination, pursuant to their respective terms,
of agreements entered into between such Companies and customers or
suppliers (including Beckman Coulter, Inc.).
ARTICLE 5
COVENANTS OF THE SELLERS
5.1 Management of the Group Companies between the date hereof and
the Closing Date
Between the date hereof and the Closing Date, except as otherwise
provided for herein or as may be expressly agreed to by the Purchaser,
the Sellers shall cause:
<PAGE>
24.
(a) each of the Group Companies to carry out its activities
solely within the normal and ordinary course of
business, including not permitting the sale, transfer or
disposition of any of the assets of the Group Companies, not
entering into any material contract or commitment, engaging in
any transaction, extending credit or incurring any obligation
with respect to the Group Companies, in each case, other than
in the usual and ordinary course of business and in a manner
consistent with past practice, and not making or instituting
any usual or novel methods of purchase, sale, management,
operation, or other business practice in the management of
the Group Companies, not modifying the compensation or
benefits payable or to become payable to employees or agents
of the Group Companies;
(b) the Company not to decide upon, or make, any distribution
of profit or reserves;
(c) each of the Group Companies not to be a party to any merger,
contribution or spin off; not to make any change to its
capital, or issue securities of any nature whatsoever or
warrants;
(d) the Group Companies not to make any modifications to the
respective articles of incorporation or by-laws of any of
Group Companies;
(e) the Group Companies not to incur any new loan granted by
parties other than their shareholders and their respective
Affiliates (except as may be directed by the Purchaser in
view of the Closing);
(f) the Group Companies not to agree to take any of the actions
set forth above;
(g) each of the Group Companies to refrain from making any change
in the accounting practices or procedures applied by the
Group Companies;
(h) each of the Group Companies not to enter into, issue or grant
to any third party any agreements, arrangements, warrants,
call options, convertible rights or other rights (vested
or contingent) to acquire any capital stock of the Group
Companies;
(i) the Group Companies to inform the Purchaser of the occurrence
of any event referred to in Section 4.23 above.
5.2 Consents / HCV License
Until the Closing Date, the Purchaser shall use reasonable efforts to
assist the Sellers and/or the Company, and from and after the Closing
Date the Sellers shall use reasonable efforts to assist the Purchaser
and/or the Company, in obtaining, prior to or after the Closing Date,
the undertaking of the counterparty(ies) to any of the Contracts listed
in Schedule 5.2 (the "Change of Control Contracts") not to terminate
such Contract in connection with, or as a result of, the change of
control of the Company hereby contemplated (the "Change of Control").
In addition to the foregoing, until the Closing Date, the Purchaser
shall cooperate with the Company and the Sellers, and from and after
the Closing Date, the Sellers shall cooperate with the Company and
the Purchaser in securing the consent of Ortho Diagnostics Systems,
Inc. and Chiron Corporation (the "O/C Parties") to the Change of
Control pursuant to Section 13.5 of the HCV License Agreement dated
November 22, 1993 between the Ortho/Chiron Parties and the Company
(the "HCV License"). To that effect, the Company shall, promptly
<PAGE>
25.
following the execution hereof, notify the O/C Parties of the
Change of Control and attempt to secure the O/C Parties' consent
thereto as soon as possible. The Purchaser shall fully participate
in these efforts, including (i) by providing written assurances to the
O/C Parties that the Purchaser shall cause the Company to continue
implementing the HCV License in accordance with its terms and its
existing net economic effect on the O/C Parties and with the Company's
past practice, and (ii) by the Company providing to the O/C Parties
reasonable incentives as agreed with the Purchaser to secure the
necessary consent such as a non-exclusive license to the HIV probes
on terms comparable to existing HIV 2 licenses of the Group Companies.
In the event that, the O/C Parties having failed to consent to the
Change of Control and having terminated the HCV License pursuant to
Section 13.5 thereof, whether before or after the Closing, (i) the
O/C Parties should have initiated legal proceedings to enjoin the
Company from exploiting the HCV License or (ii) the Group Companies'
sales of HCV License products should have decreased by more than 10%
(compared to the sales of the same six-month period of the immediately
preceding year) within the six-month period following the O/C Parties'
notice to the Company of the termination of the HCV License pursuant to
Section 13.5 thereof (excluding, however, any loss of HCV business
resulting from a change in the regulatory requirements or social
security or private insurance reimbursement regimes), then, the Sellers
shall, promptly upon notice by the Purchaser, pay to the Purchaser
the amount of Euro 19,529,343 as provisional indemnity (the "Provisional
Indemnity") for the Loss suffered by the Company as a result of
the O/C Parties' termination.
In the circumstances described in the foregoing paragraph, the Purchaser
shall cooperate with the Sellers and the Company in pursuing legal
action against the O/C Parties for wrongful termination of the HCV
License and in seeking reinstatement thereof as well as recovery of any
damages suffered by the Company and the Sellers as a result of such
termination. If the dispute with the O/C Parties is finally
resolved within twelve (12) months from the Closing Date, the
Purchaser shall refund the Sellers with any fraction of the
Provisional Indemnity equal to the excess of such indemnity over
the Loss suffered by the Company as a result of the O/C Parties'
termination of the HCV License, and the Sellers shall conversely
indemnify the Purchaser of any excess of such effective Loss
over the Provisional Indemnity up to an additional Euro 9,764,671.
In the event that the dispute with the O/C Parties should not be
finally resolved within twelve (12) months from the Closing
Date, (A) the Purchaser shall be entitled to retain the
Provisional Indemnity, subject to the Company's assignment to
the Sellers of all of the Company's rights under the HCV License
to receive monetary compensation from the O/C Parties for wrongful
termination of the HCV License, and subject to the Purchaser's
undertaking to cooperate with the Sellers and to grant the Sellers
unrestricted access to the relevant information necessary to
document such Sellers' monetary compensation demands, and (B)
in addition, the Purchaser shall be entitled to claim additional
damages from the Sellers up to a maximum amount of Euro 9,764,671
in the event that the Purchaser can establish that the effective
Loss suffered by the Group Companies as a result of the termination
of the HCV License exceeds the Provisional Indemnity.
Any indemnification of the Purchaser pursuant to this Section 5.2
(including the payment of the Provisional Indemnity) shall be subject
to the provisions of Article 8 hereof (including any limitations
contained therein), provided, however, that the aggregate maximum
amount of indemnification stipulated in Section 8.6(d) hereof shall
be increased from Euro 39,058,686 to Euro 48,823,357 in the event
that the HCV License is finally lost to the Company following
the issuance of a final decision.
<page<
26.
The Sellers shall assume the legal costs of the Company's
involvement in any legal proceeding resulting from the
O/C Parties' termination of the HCV License and shall have sole
control over such proceedings and any settlement discussions and
decisions in respect thereof. Accordingly, the Purchaser shall
not, and shall cause the Company not to, make any decision
regarding any dispute with the O/C Parties arising out of the
latter's refusal to consent to the Change of Control, without
the prior written consent of the Sellers, which consent shall
not be unreasonably withheld.
5.3 Reasonable Access
During the period from the date of this Agreement to the Closing,
the Sellers shall, to the extent necessary, provide the Purchaser
and its representatives (including the Purchaser's Auditor and
counsel), upon at least two (2) Business Days' prior notice, with
reasonable access to the books, financial reports prepared in the
ordinary course of business, records, facilities, properties, assets,
operations and authorized management of the Group Companies; provided
that such access shall not interfere with the normal business
operations of the relevant Entities and that the Purchaser and each
of its representatives being provided such access undertake to keep the
information thus communicated to them in strict confidence, upon
terms substantially conforming to the terms of the Confidentiality
Agreement.
5.4 Services Agreements
The services agreements entered into between IP and/or Sanofi
and/or its Affiliates (other than the Group Companies), on the
one hand, and the Group Companies, on the other hand, as listed
in Schedule 5.4(a), shall automatically terminate on the Closing
Date without indemnity to either party thereto. The services
agreements listed in Schedule 5.4(b) shall remain in effect
pursuant to the financial terms thereof, as applicable during
the first semester of 1999 for an initial six (6) month period
following the Closing Date, renewable once; it being understood
that the termination of said services agreements shall not give
rise to any indemnity to either party thereto and the agreements
listed in Schedule 5.4(c) shall remain effective pursuant to their
respective terms.
5.5 Termination of the Shareholders' Agreement - Amendment to
Cooperation Agreement
Each of the Sellers hereby waives any and all rights that it may
have pursuant to the Shareholders' Agreement in connection with
or as a result of the consummation of the transactions contemplated
hereby, in particular the rights of first refusal provided in
Section 2.3.1 of the Shareholders Agreement. Furthermore, IP
hereby waives its veto right provided under Section 2.3.2 of the
Shareholders Agreement, as well as its rights to rescind the
Cooperation Agreement pursuant to Section 2.4.2 of the Shareholders'
Agreement, in connection with or as a result of the consummation of
the transactions contemplated hereby.
Each of the Sellers hereby agrees that the Shareholders' Agreement
shall automatically terminate upon the Closing and shall take all
actions necessary to effect or formalize such termination.
5.6 Transfer of Sanofi IVD Patents
Sanofi undertakes to carry out any formalities required for the
transfer of the registration of the Intellectual Property Rights
currently registered under its own name or under the name of any
of its Affiliates (other than the Group Companies) listed in
<PAGE>
27.
Schedule 5.6 (the "Sanofi IVD Patents") in favor of the appropriate
Group Companies, prior to or as soon as possible after the Closing
Date; it being understood that Sanofi shall retain a non-exclusive
prepaid license to use (with no right to sub-license or assign, except
to an Affiliate) the Sanofi IVD Patents, in the field of
therapeutics and toxic drugs monitoring, until their respective
termination (the payment therefor being deemed included in the
Purchase Price). In the event that Sanofi decides to make
effective use of such license in the field of toxic drugs
monitoring, the Group Companies shall be offered by Sanofi an
option to manufacture such tests for Sanofi, on competitive
terms.
5.7 Non compete
(a) For a period of five (5) years following the Closing
Date, the Sanofi Group shall not engage in the IVD
Activities currently conducted by the Group Companies
and on the territories currently covered by such activities
(the "Business"), except as may be otherwise contemplated
by this Agreement (including, without limitation, in
connection with any subsequent transfers of Ancillary
Assets and the Kyowa agreement referred to in Schedule
4.19(a). Nothing in this Section 5.7 shall, however,
be construed as limiting the ability of the Sanofi Group
to manufacture, use and sell products, technology and
know-how currently developed, manufactured or distributed by
the Group Companies, for purposes of testing its own
pharmaceutical or other products or subsequent patient-
monitoring related tests.
(b) Notwithstanding the provisions of paragraph (b) above,
the Sanofi Group shall be entitled to acquire control
(within the meaning referred to in Article 355-1 of French law
no. 66-537 of July 24, 1966 relating to commercial companies)
of, or merge with, or otherwise enter into another business
combination with, companies or groups of companies whose main
activity does not consist of the Business, in whole or in
part, provided that it shall not take any measure specifically
designed to develop the Business during the above five-year
period.
5.8 Undertaking of IP
For a period of three (3) years from the Closing Date, IP will abstain
from engaging directly or indirectly (except through the licenses
granted now or in the future) in the manufacturing, sale or distribution
of IVD Products, representing sales in excess of US$ 10,000,000 per year;
provided, however, that this undertaking shall not prevent IP from
making initial investments in start-ups whose operations are based in
whole or in part on intellectual property developed by IP.
5.9 Specific Indemnification of Certain Disclosed Items
(a) By way of exception to the provisions of Section 8.1(c)
hereof, the Sellers shall indemnify the Purchaser for
liabilities resulting from the following matters disclosed in
the Schedules to this Agreement, under and subject to the
following terms and conditions:
(i) Scangel Proceedings: In the event of the
delivery of an arbitral award adverse to the
Company in the proceeding described in
Schedule 4.10.1(e) hereto (involving
Diamed), the Sellers shall automatically pay
to the Purchaser an indemnity of Euro 4,882,336,
plus, as the case may be, the amount of any
effective Loss suffered by the Company (or the
Group Companies) in excess of such indemnity as
a result of such adverse award;
<PAGE>
28.
(ii) Fujirebio / Centocor Matter: In the event
of a final determination adverse to the
Company in the Fujirebio / Centocor matter
described in Schedule 4.14(b) hereto, the
Sellers shall automatically pay to the
Purchaser a lump sum indemnity in the amount
of Euro 2,929,401 (which amount will be final);
(iii) Certain potential tax liabilities: In the
event that the potential tax liabilities
described in Schedule 4.12(b) and in Exhibit
2(b) to Schedule 4.12(a) hereto should
materialize, the Sellers shall indemnify the
Purchaser for any effective Loss incurred by
the Company or the Group Companies in
connection therewith;
(iv) Loss of Beckman Dealership Exclusivity: In
the event that, within ninety (90) days of
having been notified to that effect by the
Company, Beckman Coulter, Inc. should
exercise its right to terminate the
exclusivity right of the Company under the
Exclusive Dealer Agreement dated April 30,
1997, on the basis of the Change of Control,
the Sellers shall pay to the Purchaser
automatically an indemnity of Euro 2,929,401,
plus, as the case may be, the amount of any
effective Loss suffered by the Company (or
the Group Companies) in excess of such
indemnity as a result of such termination;
(v) Beckman Patent Indemnity: The Sellers shall
indemnify the Purchaser, up to a maximum
amount of Euro 2 million, for the effective
Loss suffered by the Company or the Group
Companies as a result of the Company having
had to discharge the patent indemnity
described in Schedule 4.15(iii) hereto;
(vi) Contaminated Blood Litigation: Sanofi shall
indemnify and hold the Purchaser harmless
from any liability incurred by the Company
in connection with the HIV blood contamination
that occurred in France prior to 1986; provided,
however, that Sanofi is effectively subrogated in,
or otherwise assigned, all the rights of the Company
under its insurance policies and under any
other public or private indemnification scheme.
The Sellers shall also assume the legal costs of any
litigation imposed on the Company in connection with
this matter. The Purchaser undertakes, at the request
of the Sellers, to cause the Company to involve the
relevant insurance companies in any such litigation.
(b) All amounts payable by the Sellers under sub-paragraph
(a) above shall be subject to the provisions of
Article 8 of this Agreement (including any limitations
contained therein), provided, however, that items (v) and
(vi) above shall be indemnified irrespective of the aggregate
maximum amount of indemnification stipulated in Section 8.6(d)
hereof being reached.
<PAGE>
29.
ARTICLE 6
COVENANTS OF THE PURCHASER
6.1 Certain Guarantees and Repayments
(a) The Purchaser undertakes to provide no later than on
the Closing Date its guarantee or other credit support
acceptable to the relevant creditors in replacement for all
guarantees of Sanofi or its Affiliates (other than the Group
Companies) extended in respect of any obligations of the Group
Companies, a list of which is set forth in Schedule 4.15,
except those guarantees referred to in Schedule 6.1(a).
(b) The Purchaser undertakes to make available to the
Group Companies from the Purchaser on the Closing Date
sufficient lines of credit to permit them to repay, on the
Closing Date, the total amount outstanding, including
principal and interest, under any and all borrowings made by
them from Sanofi or its Affiliates (other than the Group
Companies), which amount (the "Preliminary Amount") shall
be initially determined on the tenth (10) Business
Day preceding the Closing Date and notified to the Purchaser
no later than three (3) Business Days before the Closing Date.
No later than five (5) Business Days following the
Closing Date, Sanofi shall notify the Purchaser of the total
amount effectively outstanding, including principal and
interest, under any and all borrowings made by the Group
Companies from Sanofi or its Affiliates (other than the Group
Companies) as of the Closing Date (but prior to the Closing)
(the "Closing Date Amount"). If the Closing Date Amount
exceeds the Preliminary Amount, the Purchaser shall cause the
Group Companies to reimburse to Sanofi or its relevant
Affiliates the difference between these two Amounts no later
than five (5) Business Days after receipt by the Purchaser of
the notification of the Closing Date Amount. If the Closing
Date Amount is less than the Preliminary Amount, Sanofi agrees
to pay, or cause to be paid to the relevant Group Companies,
the difference between these two Amounts no later than five
(5) Business Days following receipt by the Purchaser of the
notification of the Closing Date Amount.
6.2 Employee Benefit Matters
(a) The Purchaser shall cause the Group Companies to
pay their employees the amounts due to them pursuant to the
agreements attached as Schedule 6.2(a), with respect to the
period running from January 1, 1999 to the Closing Date, as
such amounts shall be calculated by Sanofi, in the exercise
of its reasonable judgment, and notified to Purchaser; it is
specified that the Group Companies have provided for adequate
reserves, on a monthly basis, in respect of all sums due under
such agreements.
(b) Sanofi and its Affiliates shall remain liable,
after the Closing Date, for certain benefit obligations of
Sanofi (through its Affiliate, Sanofi, Inc.) to the employees
of SDP, Inc. and Genetic Systems Corporation accrued in
respect of the period ending on the Closing Date, in
accordance with Schedule 6.2(b). The Purchaser shall
satisfy its obligations under Schedule 6.2(b).
(c) The Purchaser shall, and shall cause the Group
Companies located in France to, maintain for a period of
eighteen (18) months after the Closing Date, without
interruption, employee compensation and benefit plans,
programs and policies and fringe benefits that are no
less favorable than those in effect as of the Closing Date.
To the extent permitted by applicable law, the employees of
such Group Companies shall continue to be given credit after
the Closing Date for all service credited to them prior to
the Closing Date, for purposes of eligibility, vesting,
<PAGE>
30.
benefit accrual, seniority or otherwise, under all employee
compensation and benefit plans, programs and policies and
fringe benefits then in effect. The Purchaser shall, and
shall cause such Group Companies to, grant to any employees
of such Group Companies dismissed within a period of eighteen
(18) months after the Closing Date severance terms consistent
with such Group Companies' past practices as implemented
prior to December 31, 1998.
6.3 Use of the "Sanofi" Name
No later than the earlier of the expiration of a period of eighteen (18)
months following the Closing Date and the date on which substantially all
stocks of products bearing the name "Sanofi", as in existence as of the
date hereof, are sold or destroyed, the Purchaser undertakes (i) to cause
any use of the "Sanofi" name by the Group Companies or the Ancillary
Assets to definitively cease and (ii) to destroy or re-label, upon
request from Sanofi or the relevant Ancillary Assets Sellers, any
product or object on which the name "Sanofi" appears (with written
confirmation of destruction or re-labeling to Sanofi).
The eighteen (18) months limitation provided in this Section 6.3
shall not apply to the reagent rentals having a residual term as of
the Closing Date greater than one (1) year, in respect of which the
Purchaser shall cause the Group Companies to use their reasonable
efforts to remove the "Sanofi" name affixed thereto as soon as possible.
The Purchaser shall cause the corporate names of the Group Companies
which include the "Sanofi" name to be modified no later than three (3)
months after the Closing Date, to remove the name Sanofi therefrom.
The Purchaser shall indemnify and hold Sanofi harmless from and against
any and all liabilities that may result from the use of the "Sanofi"
name following the Closing Date (including as contemplated by this
Section 6.3).
6.4 Guarantees of the Sellers not released at Closing
In the event that a claim involving a Group Company and/or Sanofi,
in respect of matters for which Sanofi is a guarantor of any Group
Company(ies) (as indicated in Schedule 6.1(a)) or may otherwise be
held liable, is made prior to or after the Closing Date and is not
finally settled before the Closing Date, Sanofi may retain counsel
at its own expense to defend the interests of the Group Company
involved. At Sanofi's request, the Purchaser shall cause the relevant
Group Company, as the case may be, to present all arguments, submit all
pleadings, take all actions, file all counterclaims and more
generally cooperate with Sanofi and the counsel appointed by it.
The Purchaser shall provide, and shall cause the Group Companies
to provide Sanofi with all information or documents in relation
to said claim that Sanofi may reasonably request and generally,
to fully cooperate. The Purchaser shall not, and shall cause
the Group Companies not to, settle, admit liability or withdraw
any claim (including oppositions in relation to intellectual
property rights) in connection with said claim without the prior
written consent of Sanofi.
6.5 US GAAP Financial Statements
The Purchaser shall cause the Purchaser's Auditor to take any and
all actions necessary to satisfy the condition set forth in
paragraph 10.1(b)(iii) as soon as possible following the date
hereof so as to enable the Closing to take place on August 31, 1999.
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31.
The Sellers shall cause the Group Companies and the Sellers'
Auditor to cooperate with the Purchaser's Auditor in connection
with the preparation of the financial statements referred to in
such paragraph.
ARTICLE 7
ANCILLARY ASSETS
7.1 The Ancillary Assets referred to in Exhibit C shall be
transferred to the Purchaser (and the Purchaser shall assume the
employment contracts of the persons employed principally in the
conduct of the IVD Activities, which persons are listed in
Schedule 7.1 (the "Ancillary Asset Employees") in accordance
with the principles set forth in this Section. To that effect,
the Purchaser and Sanofi shall determine, prior to the Closing
Date, the detailed list of the Ancillary Assets, as well as the
related liabilities and contracts.
7.2 The Purchaser and Sanofi shall cooperate in order to
find a mutually acceptable solution in order to ensure that the
transfers of the Ancillary Assets contemplated hereby maximizes
the economic and tax benefits for both Parties; failing an
agreement between the Parties in this respect, the transfer of
the Ancillary Assets concerned shall be effected by way of a
transfer of assets.
7.3 (a) The Ancillary Assets shall be transferred to the
Purchaser (or its designee(s)) on the Closing Date,
or on such subsequent date as the parties shall mutually
determine allowing completion of the reorganizations
referred to in Section 7.3(b)) and/or regulatory approvals
be obtained, and the assumption by the Purchaser (or its
designee(s)) of the employment contracts of the Ancillary
Assets Employees will occur simultaneously.
(b) The transfer to the Purchaser (or its designee(s)) of the
Ancillary Assets listed in Schedule 7.3(b) shall be effected
following their reorganization, as described in such Schedule.
7.4 From the date hereof to the date on which the relevant
Ancillary Assets shall be transferred to the Purchaser (or its
designee(s)), Sanofi shall cause the Ancillary Asset Sellers,
except for purposes of the reorganizations described in Schedule
7.3(b), (i) to manage the Ancillary Assets solely in accordance
with past practice and in the normal and ordinary course of
business (ii) not to enter into any contribution agreement with
respect to the Ancillary Assets, (iii) not to make any material
change in the accounting practices in connection with the
Ancillary Assets and (iv) not to modify the employment status of
any of the Ancillary Asset Employees, or any employment policies
applicable to them, or to grant to any of them any increase or
modification of compensation or benefits other than any such
increases or modifications required by applicable law or the
applicable collective employment conditions.
7.5 If, as a result of the aforementioned reorganizations,
certain Ancillary Assets may be transferred to or otherwise
isolated within Entities whose shares are to be acquired by the
Purchaser (or its designee(s)):
(i) the Purchaser undertakes to provide or cause to
provide, no later than on the date of transfer
of such Entities, its guarantee or other credit
support acceptable to the relevant creditors in
replacement for any and all guarantees of Sanofi
or its Affiliates (other than the Group
Companies) extended in respect of any
obligations of such Entities which will
terminate on the Closing Date;
<PAGE>
32.
(ii) the Purchaser undertakes to make available or
have made available to such Entities, on the
date of transfer thereof, sufficient lines of
credit to permit them to repay, on such date,
the total amount outstanding, including
principal and interest, on any and all
borrowings made by them from Sanofi and/or its
Affiliates other than the Group Companies,
according to the provisions set forth in Section
6.1(b); and
(iii) the services agreements entered into between
Sanofi and its Affiliates other than the Group
Companies, on the one hand, and such Entities,
on the other hand, if then in effect, shall
automatically terminate on the date of transfer
of said Ancillary Assets without giving rise to
any indemnity whatsoever to either of the
parties thereto, except as may be agreed between
the Parties, unless Sanofi and the Purchaser
agree to enter into a transition services
agreement, upon terms and conditions mutually
agreeable to them, to maintain the continuity of
service for a limited period of time, without
prejudice to the provisions of Section 5.4.
ARTICLE 8
NDEMNIFICATION
8.1 Principle
(a) Each Seller hereby undertakes to indemnify the
Purchaser for damages, losses and reasonable expenses
(including reasonable attorneys' fees) (collectively a
"Loss") suffered by the Purchaser or the Group Companies
as a result of:
(i) any inaccuracy or breach of any representation or warranty
extended by such Seller contained in this Agreement; or
(ii) any breach of any covenant or undertaking of such Seller
contained in this Agreement.
Any Loss resulting from an inaccuracy or breach of a
representation or warranty extended by both Sellers shall be
indemnified by each of them prorata to its shareholding in
the Company.
(b) Certain additional indemnification and Tax matters relating
to U.S. Subsidiaries are set forth in Schedule 8.1(b).
(c) It is specified that the Sellers shall not indemnify the
Purchaser in respect of any facts or matters which were
disclosed in this Agreement (including in any Exhibits or
Schedules thereto or in any document specifically referred to
therein) except as specifically provided in Sections 5.2 and
5.9 hereof. Any disclosure made in a schedule relating to a
given representation provided by this Agreement shall only be
made against such representation; provided, however, that
disclosures contained in Schedules 4.10, 4.16 and 4.20 shall
be deemed made against all the representations and warranties
of the Sellers contained in this Agreement and, provided
further, that the Purchaser shall not be entitled to
indemnification hereunder on the basis of a claim of
non-disclosure of a fact specifically disclosed by the Sellers
in any of the Exhibits and Schedules to this Agreement.
<PAGE>
33.
8.2 Claims
In order to be valid, any claims made by the Purchaser under the terms
of this Article 8 and/or Sections 5.2 and 5.9 hereof (a "Claim") shall
be made in writing as follows:
(a) each Claim shall state, with reasonable detail,
the specific grounds therefor and the amount claimed;
(b) each Claim shall be made with reasonable promptness after
the Purchaser becomes aware of the circumstances giving
rise thereto (and in any event prior to the expiration of
a statutory deadline); provided, however, that any
failure to give a timely notice will not waive any rights
of the Purchaser except to the extent that the rights of
the relevant Seller are actually prejudiced by any such delay.
8.3 Deadlines for Claims
Any Claims may give rise to indemnification only if notified by
the Purchaser to the relevant Seller prior to the expiration of a
three (3) year period from the Closing Date, or, for Claims related
to Tax and environmental matters, as well as the contaminated blood
litigation referred to in Section 5.9, prior to the expiration of a
one-month period following the date of expiration of the relevant
statute of limitations.
8.4 Third-Party Claims
In the event that a claim is made by a third party against a Group
Company which constitutes or may become the basis for a Claim, the
relevant Seller may retain counsel at its own expense to defend the
interests of the Group Company involved. At such Seller's request,
the Purchaser shall cause said Group Company, as the case may be, to
present all arguments, submit all pleadings, take all actions, file all
counterclaims and more generally cooperate with the relevant Seller
and the counsel appointed by it. The Purchaser shall provide, and
shall cause the Group Companies to provide the relevant Seller with
all information or documents in relation to said third-party claim that
the relevant Seller may reasonably request. The Purchaser shall not,
and shall cause the Group Companies not to, settle, admit liability or
withdraw any claim in connection with said third-party claim without
the prior written consent of the relevant Seller, not to be unreasonably
withheld.
8.5 Effective Nature of the Loss
(a) Any deficiency assessed by the Tax authorities whose sole
effect is to shift a tax liability from one fiscal
year to another shall give rise to indemnification by the
relevant Seller only insofar as a Group Company is required to
pay a penalty or interest charge in relation thereto.
(b) Any deficiency assessed with regard to a Tax, such as a
value-added tax, which is recoverable shall give rise
to indemnification by the relevant Seller only insofar as a
Group Company is required to pay a penalty or interest charge
in relation thereto.
(c) For purposes of calculation of the indemnification due
by any Seller, any amounts paid to the Purchaser, the Group
Companies under insurance policies or any other amount
compensating the Loss for which the Claim is made shall be
deducted or reimbursed to such Seller, as the case may be.
If the relevant Seller pays an indemnity in respect of a
Loss and the Purchaser or any of the Group Companies
subsequently recovers (even after expiration of the relevant
<PAGE>
34.
time limit set forth in Section 8.3) all or part of the amount
of such indemnity from a third party (including insurance
companies or tax authorities), the Purchaser shall take or
shall cause the Group Companies to take all reasonable steps
to recover such amount and, immediately upon recovery thereof,
shall pay, or cause the Group Companies to pay, to the relevant
Seller the amount thereby recovered (and in the event that such
recovery shall result in the indemnification due in connection
with the net amount of the concerned Loss falling below the
amount specified in subsection 8.6(c) or in the total
indemnification due in connection with the net amount of the
concerned Loss and the other Losses, if any, which are eligible
for indemnification by the Sellers, falling below the amount
specified in subsection 8.6(b), the Purchaser shall repay to
the relevant Seller the full amount paid by it in respect of
all relevant Loss and/or Losses).
(d) Any indemnification owed by any Seller shall be based on
the amount of the Loss effectively suffered by the
Group Companies, and shall be computed without regard to any
multiple, price-earnings or equivalent ratio implicit in
negotiating and/or setting the Share Purchase Price, except
as expressly provided in Section 4.7(c).
(e) Except as otherwise provided in Section 5.2 or 5.9 hereof,
in the event that a Group Company is required to make a
payment in connection with a third-party claim, the relevant
Seller shall not be required to make any indemnification
payment in connection thereto before such payment has actually
been made by such Group Company to such third party.
(f) Any item which, in the course of the procedure provided in
Section 2.1.3(b), either (x) will have been specifically
taken into account for the purpose of the Share Purchase
Price Adjustment or (y) will have been settled as a result
of an agreement between the Parties (or their respective
Auditors) or a decision of the Independent Auditor, shall be
excluded from indemnification by the Sellers.
8.6 Determination of the Indemnification
(a) The amount of the indemnity to the Purchaser due by any
Seller in connection with a Loss sustained by a Group
Company shall be pro-rated for the direct and/or indirect
interest held by the Purchaser in the share capital of said
Group Company as of the Closing Date.
(b) No indemnification shall be due by any Seller unless the
aggregate amount of the indemnification owed by the
Sellers (but for this subsection (b)) exceeds (after all
deductions pursuant to this Article 8) six million
(6,000,000) French Francs, and such indemnification shall
then become due only for the portion exceeding such amount.
(c) In respect of individual Claims, the Purchaser shall not
be entitled to indemnification unless the amount of
the indemnification exceeds one hundred thousand (100,000)
French francs per such individual Claim.
(d) The total indemnification that may be due by the Sellers
to the Purchaser under this Agreement shall not exceed
in the aggregate thirty-nine million fifty-eight thousand six
hundred and eighty-six (39,058,686) Euros. As the sole two
exceptions to the foregoing stipulation, the limitation
provided for in this paragraph 8.6(d) shall not apply to
(i) indemnification arising out of inaccuracies of or omissions
in respect of the representations of this Agreement relating
to taxes (Section 4.12) and the environment (Section 4.18)
and (ii) indemnification for any damages that may be incurred
by PSD as a result of any potential liability in connection
with the "contaminated blood" litigation (as set forth in
Schedule 4.16 hereof).
<PAGE>
35.
8.7 Exonerating and Mitigating Factors
(a) The Sellers shall not be held liable for indemnification
to the extent the Loss for which indemnification is
sought may be attributed to any voluntary action or voluntary
omission on the part of the Purchaser or the Group Companies
after the Closing Date or to any change in accounting methods
(including consolidation methods) or policies of the Group
Companies after such date.
(b) The Sellers shall not be held liable in respect of any breach
of a representation or warranty which would not have occurred
but for any Tax related law passed after the date hereof with
retroactive effect and any other law passed after the date
hereof.
(c) The Sellers shall not be held liable for indemnification
to the extent the Purchaser and the Group Companies did not,
upon learning of the situation giving rise or likely to give
rise to a Loss, use, or as concerns the Purchaser, caused the
Group Companies to use, reasonable efforts to mitigate the
corresponding Loss, subject to the corporate interest of the
Group Companies.
(d) In the event that a situation giving rise to a Claim is
curable, in whole or in part, the Purchaser shall give
the relevant Seller a reasonable opportunity to implement
such a cure for a period of thirty (30) days from notice
thereof, provided that such opportunity for cure shall not
increase the original damage or materially impair the
operations of the Purchaser.
(e) Any indemnification due by any Seller in connection with
any Loss resulting from matters specifically reserved against
by the Group Companies (whether in a general reserve account
or in a specific reserve account) shall be reduced by the
amount of such reserves.
8.8 Exclusivity of Remedy
Except in the case of fraud committed by the Sellers, the indemnification
provided in this Article 8 shall be the sole and exclusive remedy of the
Purchaser against the Sellers in respect of any breach of any
representation, warranty, covenant or undertaking of the Sellers and the
Purchaser hereby waives any rights to rescission it may have.
8.9 No Other Representations
The Sellers do not make any representation or give any warranty to the
Purchaser other than as specifically provided for in Article 4 and
Schedule 4.12(a). Without limiting the generality of the foregoing,
the Sellers do not make any representation or give any warranty to the
Purchaser with respect to financial projections, budgets or management
analyses relating to any of the Group Companies and to the future
profitability and financial performance of any of the Group Companies.
ARTICLE 9
CLOSING
9.1 Date and Place of Closing
The closing of the sale and purchase of the Shares and the Ancillary
Assets shall take place as follows:
<PAGE>
36.
(i) the principal closing (the "Closing") shall take place at the
offices of Cleary, Gottlieb, Steen & Hamilton, 41, avenue de
Friedland, 75008 Paris, on August 31, 1999 or, if all conditions
precedent set forth in Section 10.1 have not been fulfilled or
waived in accordance herewith prior to such date, on
September 30, 1999 or any such other date as may be mutually
agreed by the Parties. The date of the Closing is herein
referred to as the "Closing Date";
(ii) subsequent closings may take place to consummate the purchase
and sale of those Ancillary Assets (x) which involve
reorganizations prior to their transfer to the Purchaser
(or its designee(s)) as set forth in Section 7.3(b) and were
not so purchased and sold at the Closing or (y) in respect of
which transfer all required regulatory approvals shall have
not been obtained prior to the Closing Date; it being understood
that the Parties agree to use their best efforts to cause such
subsequent closings to take place within six (6) months after the
Closing Date and on the last day of the month (and if such day
is not a Business Day, on the next succeeding Business Day).
9.2 Closing Transactions
(a) On the Closing Date:
(i) The Sellers shall transfer and deliver to the Purchaser:
(aa) all documents necessary to effect the transfer of
the ownership of the Shares (together with any
shares of the Company owned by any legal
representative of the Company that represents the
interests of the Sellers) to the Purchaser
including duly completed and signed transfer
orders;
(bb) all documents necessary to effect the transfer of
the ownership of any share of any Group Company
owned by the Sanofi Group or IP or any
shareholder of such Group Company that represents
the interests of the Sellers or their Affiliates.
(cc) unconditional resignation letters, effective on
the Closing Date, from all of the legal
representatives of the Group Companies that
represent the interests of the Sellers or their
Affiliates, including those members of their
boards of directors and supervisory boards that
represent the interests of the Sellers or its
Affiliates, with the exception of those persons
mentioned on a list that will be notified in
writing by the Purchaser to the Sellers no later
than fifteen (15) days prior to the Closing Date;
(dd) a certified copy of the minute of the meeting of
the board of directors of the Company approving
the Purchaser as shareholder of the Company;
(ee) a written status report of all third party
consents requested in connection with the Change
of Control Contracts;
(ff) letters of resignation, duly signed by the
statutory auditors and alternate statutory
auditors of each of the Group Companies, with
effect as of the next succeeding general meeting
of the shareholders of such companies; and
<PAGE>
37.
(gg) if the Closing Date is not August 31, 1999, any
updates and amendments to the Exhibits and
Schedules to this Agreement that the Parties
shall mutually agree are necessary or appropriate
to maintain the accuracy of the statements
contained in Article 4 as of the Closing Date, it
being understood that the consent of the
Purchaser shall not be unreasonably withheld.
(ii) The Ancillary Asset Sellers shall deliver to the
Purchaser (or its designee(s)) all documents
necessary to effect the transfer to the Purchaser
(or its designee(s)) of all Ancillary Assets to
be so transferred on the Closing Date.
(iii) The Purchaser shall pay the Share Purchase Price
and the Ancillary Asset Purchase Price of any
Ancillary Assets transferred on the Closing Date
in accordance with Article 2 and shall cause the
Group Companies to pay, in immediately available
funds, the Preliminary Amount referred to in
Section 6.1(b).
(iv) The Purchaser shall deliver to the Sellers:
(aa) written waivers from the relevant creditors for
all guarantees that the Sellers or their
Affiliates other than the Group Companies made in
respect of any obligations of the Group
Companies, a list of which guarantees is set
forth in Schedule 4.15(iii) except those
guarantees referred to in Schedule 6.1(a); and
(bb) written evidence that any regulatory approval of
the transaction contemplated hereby as may be
required has been obtained.
(b) On each subsequent date on which Ancillary Assets
may be transferred, the relevant Ancillary Asset Sellers shall
deliver to the Purchaser (or its designee(s)) all documents
necessary to effect the transfer to the Purchaser (or its
designee(s)) of all Ancillary Assets to be so transferred on
such date and the Purchaser shall pay the Ancillary Asset
Purchase Price of any Ancillary Assets transferred on such
date in accordance with Section 2.2.2.
ARTICLE 10
CONDITIONS PRECEDENT - TERMINATION
10.1 Conditions Precedent
The completion of the sale of the Shares and the Ancillary Assets
is subject to the fulfillment of the following conditions precedent,
it being specified that, in the event that certain of the regulatory
approvals referred to in paragraph 10.1(a)(ii) below that are
necessary for the transfer to the Purchaser of certain Ancillary
Assets shall not have been obtained prior to the Closing Date, the
absence of such approvals shall not affect the date of transfer of
the Shares and shall only result in the postponement of the date of
transfer to the Purchaser of the Ancillary Assets concerned as
contemplated by Paragraph 9.1 (ii) hereof:
(a) For the benefit of each of the Purchaser and the Sellers:
<PAGE>
38.
(i) no injunction from a court of competent
jurisdiction shall have been issued to enjoin the
completion of the transactions contemplated by
this Agreement;
(ii) any regulatory approval required to be obtained
by the Sellers or the Purchaser prior to the
consummation of the transaction contemplated
hereby and necessary to consummate such
transaction shall have been obtained; and
(iii) the board of directors of the Company shall have
approved the Purchaser as shareholder of the
Company.
(b) For the exclusive benefit of the Purchaser, it
being understood that these conditions may be waived, in
whole or in part, at any time prior to the Closing Date,
in writing by the Purchaser:
(i) except for the consequences of termination, if
any, of material Contracts referred to in Section
5.2 hereof, between the date hereof and the
Closing Date, there shall not have occurred any
event effectively adversely affecting the
financial condition of the Group Companies, taken
as a whole, by more than Euro 39,058,686;
(ii) the Sellers shall not be in breach of any
material covenant or agreement by them set forth
herein; and
(iii) the Purchaser's Auditor shall have prepared and
delivered an audit report and audited
consolidated financial statements in US dollars
according to U.S. Generally Accepted Accounting
Principles for the Group Companies in respect of
fiscal years 1996, 1997 and 1998 prepared by the
Group Companies, all meeting the requirements of
Regulation S-X under the Securities Act of 1933,
as amended, applicable to Registration Statement
under such Act on Form S-1 and also meeting
requirements for SEC Form 8-K.
(c) For the exclusive benefit of the Sellers, it
being understood that this condition may be waived at
any time prior to the Closing Date in writing by the
Sellers:
(i) all of the representations of the Purchaser set
forth in Article 3 shall be true and accurate as
if made as of the Closing Date; and
(ii) the Purchaser shall not be in breach of any
covenant or agreement by it set forth herein, in
particular, the Purchaser shall have complied
with the obligations provided by Section 6.1 (a)
and (b).
The Parties undertake to use their best efforts to fulfill all
the conditions precedent set forth in Section 10.1 above (and
in particular to obtain the required approvals to the contemplated
transaction) as soon as possible.
10.2 Termination
In the event that the conditions precedent set forth above in
Section 10.1 are not fulfilled (or, as concerns the
conditions set forth in Section 10.1(b) and (c), are not waived
<PAGE>
39.
by their respective beneficiaries) at the latest on October 31,
1999, this Agreement shall automatically terminate without
prejudice to (i) the rights of any Party in the event of a prior
breach hereof by another Party and (ii) the provisions of the
confidentiality agreement entered into by the Purchaser on March
5, 1999 (the "Confidentiality Agreement") which will survive
the termination of this Agreement.
ARTICLE 11
GENERAL PROVISIONS
11.1 Cooperation
Subject to the terms and conditions herein provided, each of
the Parties hereto agrees to use its best efforts to take,
or cause to be taken, all actions and to do, or cause to
be done, all things necessary, proper or advisable under
applicable law to consummate and make effective the transactions
contemplated by this Agreement. If at any time after the
Closing any further action is necessary or desirable to carry
out the purposes of this Agreement, the authorized officers or
directors of the Sellers or Purchaser, as the case may be, shall
take all such action. The Sellers on the one hand and Purchaser
on the other hand shall fully cooperate with each other with
respect to any such further actions; to that effect, the Company
shall provide to the Purchaser those monthly financial reports
prepared by the Group Companies in the ordinary course of
business.
11.2 Confidentiality and Announcements
The Parties hereby agree to keep confidential the terms and
conditions contained in this Agreement, except as may
be required by applicable law or requested by a competent
judicial, administrative or regulatory authority, in which case
the disclosure that may be required to be made by either Party
shall be subject to the prior written consent of the other
Party, which consent shall not be unreasonably withheld.
Consequently, all announcements made in connection with this
Agreement and the transactions contemplated hereby shall be
the subject of a consultation between the Parties and a
prior agreement between the Purchaser and the Sellers, which
agreement shall not be unreasonably withheld. Notwithstanding
the foregoing, the Purchaser may disclose the terms and
conditions of this Agreement and any information furnished by
the Sellers in connection herewith to any person reasonably
necessary to facilitate any proposed financing of the
transactions contemplated herein, provided, however, that such
person shall agree to protect the confidentiality of such terms,
conditions and information. Such disclosure shall be subject,
in any event, to the prior review thereof and comments thereon
by the Sellers to the extent that such disclosure may relate to
them, which the Purchaser agrees to take into account to the
greatest reasonable extent.
11.3 Absence of Third-Party Rights - Assignment
This Agreement is concluded for the sole benefit of
the Parties (and their respective successors), and shall not
benefit or create any rights whatsoever in favor of any third
party. This Agreement shall not be assigned by either Party
without the prior written consent of the other, except to
wholly-owned Affiliates of such Party, provided, however, that
the assigning Party shall remain jointly liable with the
assignee for all of its obligations and liabilities hereunder,
for the entire term thereof.
<PAGE>
40.
11.4 Entire Agreement
This Agreement (including its Exhibits and its Schedules)
represents the entire agreement existing between the
Parties relating to the subject matter hereof and supersedes all
prior understandings and agreements (other than the
Confidentiality Agreement) of the Parties with respect to the
subject matter hereof. The Purchaser acknowledges that neither
the Sellers nor any of their Affiliates, directors, employees,
agents, representatives or advisors makes any representation or
warranty, either express or implied, as to the accuracy or
completeness of (and agrees that none of such persons shall have
any liability or responsibility to it in respect of) any of the
information provided or made available to the Purchaser or its
agents or representatives, except as and only to the extent
expressly provided for in this Agreement.
11.5 Waivers and Amendments
No modification of or amendment to this Agreement shall be valid
unless set forth in an instrument in writing signed by each of
the Parties. Any waiver of any term or condition of this Agreement
must be set forth in an instrument in writing signed by the waiving
Party and must refer specifically to the term or condition to be
waived and to the circumstances of such waiver. No such waiver shall
be deemed to constitute a waiver applicable either to other
circumstances involving the same term or condition or to any other
term or condition of this Agreement.
11.6 Severability
If any provision of this Agreement is held to be invalid in
whole or in part, the validity of the remaining provisions
of the Agreement shall not be affected. In such event, the
Parties shall, if possible, substitute for such invalid
provision a valid provision corresponding to the spirit
and purpose thereof.
11.7 Section Headings
The section headings in this Agreement are for
convenience of reference only and shall not be deemed in
themselves to have any contractual value or particular
interpretation. Except as indicated otherwise, references made
in this Agreement to articles, sections, subsections, Exhibits
and schedules are made to articles, sections, subsections,
Exhibits and schedules of this Agreement.
11.8 Representation
(a) IP hereby gives to Sanofi all necessary powers, for
the entire term and all consequences hereof, in order to be
represented by Sanofi, for the purpose of all notifications
or communications to be made to or by IP under the terms
hereof or in connection herewith. The foregoing delegation
is for administrative convenience only and shall, in no way
affect the rights and obligations of IP.
(b) Sanofi hereby represents that it has been given the necessary
powers from the Ancillary Asset Sellers, for the entire term
and all consequences hereof, in order to represent them
vis-a-vis the Purchaser. Consequently, all actions, claims,
objections or decisions on the part of the Ancillary Asset
Sellers provided for herein or in connection herewith shall
be validly engaged, made or taken in their name by Sanofi.
Likewise, the Ancillary Asset Sellers shall be validly
represented by Sanofi for the purpose of all notifications or
communications to be made to or by them under the terms hereof
or in connection herewith.
<PAGE>
41.
11.9 Notices and Communications
All notices and communications provided for herein shall be deemed to
have been duly given if delivered to the following addresses:
- If to the Purchaser, to:
Bio-Rad Laboratories Inc.
1000 Alfred Nobel Drive
Hercules, California, 94547
To the attention of General Counsel
- If to the Sellers, to:
Sanofi
174, avenue de France
75013 Paris
To the attention of General Counsel
and:
Institut Pasteur
25-28, rue du Docteur Roux
75724 Paris Cedex 15
To the attention of Directeur General
or to such other addresses as the addressees shall indicate in
accordance with the provisions of this Section. All notices or
communications shall be hand delivered against a receipt signed
and dated by the addressee, or sent by registered mail with
return receipt requested or by overnight delivery, and shall be
deemed to have been received on the date stated on the receipt
by the addressee for hand delivery, or three (3) days after the
date of the postmark on the receipt of mailing, for registered
mail or the date of deposit with the overnight delivery service.
11.10 Costs
The Purchaser and the Sellers shall each be responsible for
payment of all fees and costs respectively incurred in connection
with this Agreement and the operations contemplated herein, including
the fees and disbursements of their respective financial advisors,
auditors and attorneys.
11.11 Governing Law
This Agreement shall be governed by the laws of France.
11.12 Disputes
The Parties undertake to attempt to settle amicably
and in good faith any dispute that may arise under this
Agreement. In the absence of such a settlement, disputes
thereunder shall be finally resolved under the Rules of
Arbitration of the Court of Arbitration of the International
Chamber of Commerce (the "ICC"), as in effect upon commencement
of the arbitration proceedings, by three (3) arbitrators
appointed in accordance with said Rules. The place of the
arbitration shall be Paris, France and all related proceedings
shall be conducted in the English language.
<PAGE>
42.
Made in Paris, on July 3, 1999, in three (3) original counterparts.
SANOFI-SYNTHELABO BIO-RAD LABORATORIES INC.
/s/ Christian Mignon /s/ David Schwartz
_______________________ _______________________
By: Christian Mignon By: David Schwartz
Duly authorized Duly authorized
INSTITUT PASTEUR
/s/ Jean Castex
_______________________
By: Jean Castex
Duly authorized
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE 1 DEFINITIONS..................................................2
ARTICLE 2 SALE AND PURCHASE OF THE SHARES AND ANCILLARY ASSETS.........6
2.1 The Shares ..................................................6
2.1.1 Sale and Purchase of the Shares..............................6
2.1.2 Share Purchase Price.........................................6
2.1.3 Share Purchase Price Adjustment..............................6
2.2 Ancillary Assets.............................................9
2.2.1 Sale and Purchase of the Ancillary Assets....................9
2.2.2 Ancillary Asset Purchase Price...............................9
2.2.3 Ancillary Asset Purchase Price Adjustment...................10
ARTICLE 3 REPRESENTATIONS OF THE PURCHASER............................11
3.1 Organization, Authority and Validity........................11
3.2 No Breach...................................................11
3.3 Consents....................................................11
3.4 Brokers.....................................................12
ARTICLE 4 REPRESENTATIONS OF THE SELLERS..............................12
4.1 Organization, Authority and Validity........................12
4.2 No Breach...................................................13
4.3 Consents....................................................14
4.4 Incorporation, Existence and Authority of the
Group Companies............................................14
4.5 Capital Structure...........................................14
4.6 Transferability of the Shares...............................14
4.7 Financial Statements........................................14
4.8 Real Estate.................................................15
4.9 Movable Property, Businesses ("Fonds de Commerce")
and Inventory..............................................15
4.10 Intellectual Property Rights................................16
4.11 Loans.......................................................18
4.12 Tax, Social Security and Customs............................18
4.13 Insurance...................................................19
4.14 Contracts...................................................19
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4.15 Relations with the Sellers..................................20
4.16 Disputes....................................................20
4.17 Compliance with Law.........................................20
4.18 Environment.................................................21
4.19 Ancillary Assets............................................21
4.20 Labor Matters...............................................21
4.21 Product Liability...........................................22
4.22 Brokers.....................................................23
4.23 No Material Adverse Change..................................23
4.24 Year 2000 Compliance........................................23
4.25 Euro Compliance.............................................23
4.26 Maintenance of Business.....................................23
ARTICLE 5 COVENANTS OF THE SELLERS....................................23
5.1 Management of the Group Companies between the date
hereof and the Closing Date................................23
5.2 Consents / HCV License......................................24
5.3 Reasonable Access...........................................26
5.4 Services Agreements.........................................26
5.5 Termination of the Shareholders' Agreement -
Amendment to Cooperation Agreement.........................26
5.6 Transfer of Sanofi IVD Patents............................. 26
5.7 Non compete.................................................27
5.8 Undertaking of IP...........................................27
5.9 Specific Indemnification of Certain Disclosed Items.........27
ARTICLE 6 COVENANTS OF THE PURCHASER..................................29
6.1 Certain Guarantees and Repayments...........................29
6.2 Employee Benefit Matters....................................29
6.3 Use of the "Sanofi" Name....................................30
6.4 Guarantees of the Sellers not released at Closing...........30
6.5 US GAAP Financial Statements................................30
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(continued)
Page
ARTICLE 7 ANCILLARY ASSETS............................................31
7.1 ............................................................31
7.2 ............................................................31
7.3 ............................................................31
7.4 ............................................................31
7.5 ............................................................31
ARTICLE 8 INDEMNIFICATION.............................................32
8.1 Principle...................................................32
8.2 Claims......................................................33
8.3 Deadlines for Claims........................................33
8.4 Third-Party Claims..........................................33
8.5 Effective Nature of the Loss................................33
8.6 Determination of the Indemnification........................34
8.7 Exonerating and Mitigating Factors..........................35
8.8 Exclusivity of Remedy.......................................35
8.9 No Other Representations....................................35
ARTICLE 9 CLOSING.....................................................35
9.1 Date and Place of Closing...................................35
9.2 Closing Transactions........................................36
ARTICLE 10 CONDITIONS PRECEDENT - TERMINATION.........................37
10.1 Conditions Precedent........................................37
10.2 Termination.................................................38
ARTICLE 11 GENERAL PROVISIONS.........................................39
11.1 Cooperation.................................................39
11.2 Confidentiality and Announcements...........................39
11.3 Absence of Third-Party Rights - Assignment..................39
11.4 Entire Agreement............................................40
11.5 Waivers and Amendments......................................40
11.6 Severability................................................40
11.7 Section Headings............................................40
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(continued)
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11.8 Representation..............................................40
11.9 Notices and Communications..................................41
11.10 Costs.......................................................41
11.11 Governing Law...............................................41
11.12 Disputes....................................................41
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<PAGE>
LIST OF EXHIBITS & SCHEDULES TO THE PURCHASE AGREEMENT
Reference in
the Purchase Description of the Exhibit or the Schedule
Agreement
Exhibit A Organizational Chart of the Group Companies
Exhibit B List of the Ancillary Asset Sellers
Exhibit C Detailed list of the Ancillary Assets and Net
book value of the Ancillary Assets
Exhibit D Method used for the calculation of the Consolidated
Reference Net Worth ("Calculation Method")
Exhibit E Method used for the calculation of the Consolidated
Closing Date Net Worth ("June Calculation")
Exhibit F Letters of Ernst & Young dated April 22, 1999
Exhibit G Calculation of the Consolidated EBITDA
Sched. 4.2.1 Events in which the execution of the Agreement or
the performance by Sanofi of its obligations
thereunder or the consummation of the transactions
contemplated thereby does or will:
(i) conflict with or violate any provision of the
by-laws or any other corporate govenance document
of Sanofi or of any Group Company; or
(ii) to Sanofi's best knowledge, violate, conflict
with or result in the breach of any Contract
to which Sanofi or any Group Company is a party; or
(iii) constitute a violation by it or any Group Company
of any laws or regulations.
Sched. 4.2.2 Events in which the execution of the Agreement or the
performance by IP of its obligations thereunder or the
consummation of the transactions contemplated thereby
does or will:
(i) conflict with or violate any provision of the
by-laws or any other corporate govenance document
of IP or of any Group Company; or
(ii) to IP's best knowledge, violate, conflict with or
result in the breach of any Contract to which IP or
any Group Company is a party; or
(iii) constitute a violation by it or any Group Company
of any laws or regulations.
Sched. 4.3.1 List of consents to be obtained by Sanoft or any Group
Company in connection with the execution of the Agreement
or the consummation of any of the transactions contemplated
therein
Sched. 4.3.2 List of consents to be obtained by IP or any Group Company
in connection with the execution of the Agreement or the
consummation of any of the transactions contemplated
therein
Sched. 4.4.1 Number of shares, directly or indirectly, owned by Sanofi
in the Company and its Subsidiaries
<PAGE>
Reference in
the Purchase Description of the Exhibit or the Schedule
Agreement
Sched. 4.4.2 Number of shares, directly or indirectly, owned by
IP in the Company and its Subsidiaries
Sched. List of the Group Companies indicating their jurisdiction
4.4.3 (a) of incorporation, their shareholding and any interest
they may have in other Entities
Sched. List of the Group Companies that are subject to voluntary
4.4.3 (d) or juridicial reorganization proceedings, or similar
proceedings or that are undergoing a liquidation
Sched. 4.5(a) Liens affecting the Shares or any shares and other equity
interests in the Subsidiaries
Sched. 4.6 Number and purcentage of the Shares owned by Sanofi and IP
Sched. Proforma 1998 Financial Statements
4.7(a)(i)
Sched. Sanofi Group Accounting Principles
4.7(a)(ii)
Sched. Diagnostics Division specific Accounting Principles
4.7(a)(iii)
Sched. Material liabilities of the Group Companies as of
4.7(a)(iv) December 31, 1998, not reflected or not reserved against
in the Proforma 1998 Financial Statements
Sched. List of senior management of the Group Companies
4.7(b)(i)
Sched. Since December 31, 1998:
4.7(b)(ii) (i) exceptions to the conduct of the business of
the Group Companies in the ordinary course of
business and in a manner consistent with past
practice,
(ii) distribution of dividends, modifications to the
by-laws, or modifications to the share capital of the
Group Companies and
(iii) liabilities incurred by the Group Companies out
of the ordinary course of business and that had a
material adverse effect on their financial condition
Sched. 4.8(a) List of all real estate owned or leased by the Group
Companies, including all land and buildings used for
purposes of carrying out their activities
Sched. 4.8(b) Liens affecting the value or the use of the Real Estate
owned by the Group Companies
Sched. 4.8(c) Real Estate not owned by the Group Companies and leased
pursuant to non valid lease agreements
<PAGE>
Reference in
the Purchase Description of the Exhibit or the Schedule
Agreement
Sched. 4.9(a) Movable property, installations and equipment, used
by the Group Companies to conduct their businesses,
that either are (i) subject to Liens (for owned movable
property) or (ii) leased under the terms of a non valid
lease, operating lease or capital lease agreement
Sched. 4.9(b) Businesses that (i) have not been operated, in all
material respect, in accordance with currently applicable
laws and regulations or (ii) are not fully owned by
the Group Companies or (iii) are affected by Liens
Sched. (i) List of all patents, patent applications, registered
4.10.1(a) trademarks, trademark applications, owned by the Group
Companies,
(ii) List of licenses granted to the Group Companies in
connection with patents, patent applications, registered
trademarks, trademark applications, know-how and
intellectual property rights to monoclonal antibodies,
except pursuant to the Cooperation Agreement,
(iii) Indicative list of cell lines and monoclonal
antibodies held by the Group Companies
Sched. Intellectual Property Rights (except for Sanofi IVD
4.10.1(b) Patents) not owned or used pursuant to license agreements
by the Group Companies and Intellectual Property Rights
owned by the Group Companies (or by Sanofi for Sanofi IVD
Patents) that are subject to any Liens (with the exception
of rights granted to third parties pursuant to license
agreements) or are no longer enforceable as a result of
non-compliance with the formalities required to maintain
them in full force and effect or the failure to use such
Intellectual Property Rights
Sched. Absence of valid title to the Intellectual Property Rights
4.10.1(c) owned by the Group Companies (or by Sanofi for Sanofi IVD
Patents)
Sched. Licenses or other rights to use any of the Intellectual
4.10.1(d) Property Rights granted, or agreed to be granted, to any
third party by the Group Companies
Sched. Intellectual Property Rights used but not owned by the
4.10.1(e) Group Companies that are not used by the Group Companies
pursuant to valid license agreements; material breaches
under any of the license agreements; summary description
of proceedings and claims currently outstanding against
the Group Companies in respect of the Intellectual
Property Rights
Sched. Obligations of payment by the Group Companies in connection
4.10.1(f) with the ownership or use of the Intellectual Property
Rights other than (aa) fees payable to their intellectual
property counsels and to competent authorities to
maintain their Intellectual Property Rights in full force
and effect and (bb) with respect to Intellectual Property
Rights not owned by them, the royalties and cash payments
provided in the corresponding license agreement
Sched. Alterations or impairments of the Group Companies' rights
4.10.1(g) under license agreements that may be caused by the
consummation of the contemplated transaction
<PAGE>
Reference in
the Purchase Description of the Exhibit or the Schedule
Agreement
Sched. List of patents, registered trademarks and know-how owned
4.10.2(a)(i) in whole or in part by IP and currently used by all or
certain of the Group Companies or that the Group
Companies, are entitled to use, in each case in the
field of the IVD Activities, pursuant to the Cooperation
Agreement (the IP Patents and Trademarks")
Sched. IP Patents and Trademarks licensed on a non-exclusive
4.10.2(a)(ii) basis
Sched. IP Patents and Trademarks that are not owned or co-owned
4.10.2(b) by IP pursuant to valid tittle and co-owned IP Patents
and Trademarks in respect of which IP is not entitled
to grant licenses to third-parties pursuant to a
management agreement relating thereto
Sched. IP Patents and Trademarks subject to Liens or that are
4.10.2(c) not enforceable as a result of non-compliance with the
formalities required to maintain them in full force
and effect or the failure to use such Patents and
Trademarks
Sched. Licenses or other rights to use those of the IP Patents
4.10.2(d) and Trademarks licensed to the Group Companies, on an
exclusive basis, that are granted by IP or agreed to be
granted by IP to any third parties
Sched. Summary description of proceedings and claims currently
4.10.2(e) outstanding against IP or the Group Companies in respect
of the IP Patents and Trademarks
Sched. 4.11 Outstanding loans granted to any individual or legal
entity by the Group Companies, with the exception of
customary loans to employees or bodies responsible for
the collection of employer's construction fund
contribution and loans granted to other Group Companies
Sched. 4.12(a) Representations and warranties specific to the US
Subsidiaries
Sched. 4.12(b) (i) Reports and returns in respect of Taxes that were
not filed by the Group Companies on a timely basis with
the competent authorities and reports and returns that
were not true and accurate in all material respects when
Filed,
(ii) Taxes required to be paid by the Group Companies
that were due and payable prior to the date hereof that
have not been paid by the Group Companies and
(iii) insufficient provisions in the Proforma 1998
Financial Statements, in connection with the payment of
all Taxes that were not due and payable prior to
January 1, 1999 but for which the Group Companies may
be liable in respect of periods ending prior to January 1,
1999, regardless of whether the liability for such Taxes
is disputed
Sched. 4.12(c) Group Companies subject to audits or investigations by a
competent authority regarding Taxes
Sched. 4.13(a) List of insurance policies in effect
Sched. 4.13(b) List of material pending claims or disputes in connection
with insurance policies
<PAGE>
Reference in
the Purchase Description of the Exhibit or the Schedule
Agreement
Sched. 4.14(a) List of all Contracts (except for license
agreements relating to Intellectual Property Rights)
between any of the Group Companies and a third party,
that (i) involve the obligation (including contingent
obligation) by or to any of the Group Companies to pay
amounts in excess of one million French Francs in any
year (on the basis of the Proforma 1998 Financial
Statements) or (ii) were not entered into in the ordinary
course of business of the Group Companies
Sched. 4.14(b) Contracts listed in Schedule 4.14(a) that are not valid,
binding or enforceable by one or more of the Group
Companies in accordance with their respective terms and
Contracts listed in Schedule 4.14(a) under which any
party thereto is materially in default
Sched. 4.14(c) Contracts listed in Schedule 4.14(a) providing for a
clause pursuant to which any other party to such
Contracts may request that they be terminated,
modified or renegotiated, as a result of the
contemplated transaction
Sched. 4.15 (i) Properties and rights whatsoever, that are
necessary for the Group Companies to carry out their
activities (other than the IP Patents and Trademarks)
held by any of the Sellers;
(ii)Contracts with any Group Companies to which any of
the Sellers is party and rights against the Group
Companies held by any of the Sellers (other than
the shareholders' rights of the Sellers vis-a-vis
the Group Companies, Sanofi's rights to the Sanofi IVD
Patents and IP's rights under the Cooperation Agreement
and the licenses of the IP Patents and Trademarks to
the Group Companies); and
(iii)guarantees or other security interests securing
any of the Group Companies' undertakings granted by any
of the Sellers and guarantees granted by any of the Group
Companies to secure any of the Sellers' obligations
vis-a-vis third parties
Sched. 4.16 Summary description of judicial, administrative or
arbitration proceedings pending against any of the Group
Companies, which would have a material adverse effect on
its business condition or the economic or financial
prospects of the Group Companies taken as a whole
Sched. 4.17 (i) Permits and other consents required to conduct
the respective operations of the Group Companies as
currently being conducted that are not possessed by them;
and
(ii) non-compliance with these permits or consents or
with any laws or regulations currently applicable to the
Group Companies in the conduct of their operations
(except for instances of non-compliance that would not
reasonably be expected to have a material adverse effect
on the relevant Group Company)
<PAGE>
Reference in
the Purchase Description of the Exhibit or the Schedule
Agreement
Sched. 4.18 Activities carried out by the Group Companies
that do not comply with environmental laws or
regulations currently applicable to them; environmental
authorizations and licenses required for the conduct
of the Group Companies' operations as currently conducted
that have not been obtained by the Group Companies,
and non-compliance with said authorizations and licenses
Sched. 4.19(a) (i) Ancillary Assets that are not wholly-owned by the
Ancillary Asset Sellers and/or (ii) Liens affecting
the Ancillary Assets
Sched. 4.20(a) List of the employees of the Group Companies (including
the US Subsidiaries) and of the Ancillary Asset Employees;
description of liabilities relating to such employees
Sched. 4.20(b) List of retirement plans, profit-sharing schemes and
optional employee plans to which the Group Companies
participate or contribute, other than those legally
required
Sched. 4.20(c) List of contracts concluded between any Group Company
and its employees, which provide, in the event of
termination, for a notice period or payment of an
indemnity which exceeds those provided for by applicable
laws, regulations and/or collective bargaining agreements
Sched. 4.20(d) Outstanding commitments and undertakings made by the Group
Companies (including the US Subsidiaries) and of the
Ancillary Asset Employees vis-a-vis their former employees
Sched. 4.20(e) Undertakings given or commitments made by the Group
Companies in connection with any restructuring plan (plan
social) or dismissal plan (licenciement collectif)
that have not been entirely performed or fulfilled
Sched. 4.20(f) Summary description of current labor litigation involving
claims by employees of the Group Companies
Sched. 4.20(g) Undertakings given by the Group Companies including the
US Subsidiaries and of the Ancillary Asset Employees to
their employees in connection with the contemplated
transaction
Sched. 4.20(h) Ancillary Asset Employees for whom none of the
representations and warranties contained in Section 4.20
are made
Sched. 4.21(a) Product recalls
Sched. 4.2l(b) Warranties granted by any of the Group Companies with
respect to its products under the terms of which any of
them would be liable beyond the limits and periods
provided for by law and/or the general conditions of sale
of the Group Companies, as applicable
Sched. 4.24 Presentations, reports and memoranda relating to Y2K
<PAGE>
Reference in
the Purchase Description of the Exhibit or the Schedule
Agreement
Sched. 4.25 Presentations, reports and memoranda relating to Euro
Sched. 5.2 List of Change of Control Contracts
Sched. 5.4(a) Services agreements, between Sanofi or its Affiliates,
on the one hand, and the Group Companies, on the other
hand, that shall terminate on the Closing Date
Sched. 5.4(b) Services agreements that shall remain in effect,
between Sanofi or its Affiliates, on the one hand, and
the Group Companies, on the other hand, for a renewable
6 month period following the Closing Date
Sched. 5.4(c) Agreements that shall remain in effect, between Sanofi
or its Affiliates, on the one hand, and the Group
Companies, on the other hand, after the Closing Date,
according to their terms and conditions
Sched. 5.6 List of the Intellectual Property Rights currently
registered under Sanofi`s name or under the name of any
of its Affiliates (the "Sanofi IVD Patents")
Sched. 6.1(a) List of guaranties extended by Sanofi to the Group
Companies that will be maintained after the Closing Date
Sched. 6.2(a) Copy of Sanofi Group profit-sharing plans applicable to
certain of the Group Companies
Sched. 6.2(b) Terms and conditions of the transfer of financial assets
and of the benefit obligations relating to the employees
of US Subsidiaries
Sched. 7.1 List of the Ancillary Asset Employees
Sched. 7.3(b) List of the Ancillary Assets subject to reorganization
before being transferred to the Purchaser and description
of the reorganization to be implemented
Sched. 8.l(b) Additional indemnification and Tax matters relating to
the US Subsidiaries