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Article I THE MERGER | 1 | |||
Section 1.01. The Merger | 1 | |||
Section 1.02. Consummation of the Merger | 2 | |||
Section 1.03. Effects of the Merger | 2 | |||
Section 1.04. Articles of Incorporation and Bylaws | 2 | |||
Section 1.05. Directors and Officers | 2 | |||
Section 1.06. Conversion of Shares | 2 | |||
Section 1.07. Conversion of Common Stock of Merger Sub | 2 | |||
Section 1.08. Withholding Taxes | 3 | |||
Section 1.09. Subsequent Actions | 3 | |||
Article II DISSENTING SHARES; PAYMENT FOR SHARES; OPTIONS | 3 | |||
Section 2.01. Dissenting Shares | 3 | |||
Section 2.02. Payment for Shares | 3 | |||
Section 2.03. Closing of the Company’s Transfer Books | 5 | |||
Section 2.04. Existing Stock Options, Restricted Stock Units and Warrants | 5 | |||
Article III REPRESENTATIONS AND WARRANTIES OF THE COMPANY | 6 | |||
Section 3.01. Organization and Qualification | 6 | |||
Section 3.02. Capitalization | 6 | |||
Section 3.03. Authority for this Agreement; Board Action | 8 | |||
Section 3.04. Consents and Approvals; No Violation | 8 | |||
Section 3.05. Reports; Financial Statements | 9 | |||
Section 3.06. Absence of Certain Changes | 11 | |||
Section 3.07. Proxy Statement | 11 | |||
Section 3.08. Brokers; Certain Expenses | 11 | |||
Section 3.09. Employee Benefit Matters / Employees | 11 | |||
Section 3.10. Litigation | 14 | |||
Section 3.11. Tax Matters | 15 | |||
Section 3.12. Compliance with Law; No Default; Permits | 16 | |||
Section 3.13. Environmental Matters | 16 | |||
Section 3.14. Intellectual Property | 18 | |||
Section 3.15. Real Property | 19 | |||
Section 3.16. Material Contracts | 20 | |||
Section 3.17. Regulatory Compliance | 22 | |||
Section 3.18. Insurance | 24 | |||
Section 3.19. Customers and Suppliers | 24 | |||
Section 3.20. Questionable Payments | 24 | |||
Section 3.21. Related Party Transactions | 25 | |||
Section 3.22. Opinion | 25 | |||
Section 3.23. Required Vote of Company Shareholders | 25 | |||
Section 3.24. State Takeover Statutes Inapplicable; Rights Agreement | 25 | |||
Section 3.25. OFAC / Export Control Provision | 25 | |||
Article IV REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB | 26 | |||
Section 4.01. Organization and Qualification | 26 | |||
Section 4.02. Authority for this Agreement | 26 |
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Section 4.03. Proxy Statement | 26 | |||
Section 4.04. Consents and Approvals; No Violation | 26 | |||
Section 4.05. Litigation | 27 | |||
Section 4.06. Interested Shareholder | 27 | |||
Section 4.07. Sufficient Funds | 27 | |||
Section 4.08. Brokers | 27 | |||
Article V COVENANTS AND AGREEMENTS | 27 | |||
Section 5.01. Conduct of Business of the Company | 27 | |||
Section 5.02. No Solicitation | 30 | |||
Section 5.03. Access to Information | 33 | |||
Section 5.04. Shareholder Approval | 33 | |||
Section 5.05. Reasonable Best Efforts | 34 | |||
Section 5.06. Indemnification and Insurance | 35 | |||
Section 5.07. Employee Matters | 36 | |||
Section 5.08. Takeover Laws | 37 | |||
Section 5.09. Proxy Statement | 37 | |||
Section 5.10. Notification of Certain Matters | 37 | |||
Section 5.11. Securityholder Litigation | 38 | |||
Section 5.12. Subsequent Filings | 38 | |||
Section 5.13. Press Releases | 38 | |||
Section 5.14. Rule 16b-3 | 38 | |||
Section 5.15. Stock Options, Restricted Stock Units and Warrants | 38 | |||
Section 5.16. Termination of Company ESPP | 38 | |||
Section 5.17. Certain Legal Compliance Matters | 39 | |||
Section 5.18. Further Actions | 39 | |||
Section 5.19. Acknowledgement of Certain Obligations | 39 | |||
Section 5.20. 2025 Notes | 40 | |||
Section 5.21. Bridge Loan | 40 | |||
Article VI CONDITIONS TO CONSUMMATION OF THE MERGER | 40 | |||
Section 6.01. Conditions to Each Party’s Obligation To Effect the Merger | 40 | |||
Section 6.02. Conditions to Obligations of Parent and Merger Sub | 41 | |||
Section 6.03. Conditions to Obligations of the Company | 41 | |||
Article VII TERMINATION; AMENDMENT; WAIVER | 42 | |||
Section 7.01. Termination | 42 | |||
Section 7.02. Effect of Termination | 43 | |||
Section 7.03. Fees and Expenses | 43 | |||
Section 7.04. Amendment | 45 | |||
Section 7.05. Extension; Waiver; Remedies | 45 | |||
Article VIII MISCELLANEOUS | 45 | |||
Section 8.01. Representations and Warranties | 45 | |||
Section 8.02. Entire Agreement; Assignment | 46 | |||
Section 8.03. Enforcement of the Agreement; Jurisdiction | 46 | |||
Section 8.04. Notices | 47 | |||
Section 8.05. Governing Law | 48 | |||
Section 8.06. Descriptive Headings | 48 | |||
Section 8.07. Parties in Interest | 48 | |||
Section 8.08. Counterparts | 48 |
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Section 8.09. Certain Definitions | 49 | |||
Section 8.10. Interpretation | 51 |
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Defined Terms | Defined in Section | |
1987 Plan | Section 2.04(a) | |
2000 Plan | Section 2.04(a) | |
2025 Notes | Section 3.02(a) | |
3F Agreement | Section 5.19 | |
409A Authorities | Section 3.09(p) | |
Acquisition Proposal | Section 5.02(g)(i) | |
Affiliate | Section 8.09(a) | |
Aggregate Consideration | Section 8.09(l) | |
Agreement | Preamble | |
AJCA | Section 3.09(p) | |
Alternative Per Share Consideration | Section 8.09(l) | |
Alternative Transaction | Section 7.03(b) | |
Anti-Bribery Laws | Section 3.20 | |
Associate | Section 8.09(a) | |
beneficial ownership | Section 8.09(b) | |
Book-Entry Shares | Section 2.02(b) | |
Business Day | Section 8.09(c) | |
Certificates | Section 2.02(b) | |
Closing | Section 1.02 | |
Code | Section 1.08 | |
Common Interest Agreement | Section 8.09(o) | |
Company | Preamble | |
Company Acquisition Agreement | Section 7.03(b)(i) | |
Company Employees | Section 5.07(a) | |
Company ESPP | Section 5.16(a) | |
Company Financial Advisor | Section 3.08 | |
Company Intellectual Property | Section 3.14(b) | |
Company Partner | Section 3.17(b) | |
Company SEC Reports | Section 3.05(a) | |
Company Securities | Section 3.02(a) | |
Confidentiality Agreement | Section 8.09(n) | |
Disclosure Letter | Article III | |
Dissenting Shares | Section 2.01 | |
Effective Time | Section 1.02 | |
End Date | Section 8.09(d) | |
Environmental Laws | Section 3.13(d)(i) | |
Environmental Liabilities | Section 3.13(d)(ii) | |
Environmental Permits | Section 3.13(b) | |
ERISA | Section 3.09(a) | |
ERISA Affiliate | Section 3.09(c) | |
Exchange Act | Section 3.04 | |
Existing Restricted Stock Units | Section 2.04(b) | |
Existing Stock Options | Section 2.04(a) | |
Existing Warrants | Section 2.04(c) | |
FDA | Section 3.17(a) | |
FDCA | Section 3.17(f) | |
Fee | Section 8.09(f) | |
Foreign Antitrust Laws | Section 3.04 | |
GAAP | Section 3.05(b) | |
Governmental Entity | Section 3.04 | |
Government Official | Section 8.09(p) | |
Hazardous Materials | Section 3.13(d)(iii) | |
HSR Act | Section 3.04 | |
Indemnified Person | Section 5.06(a) | |
Indenture | Section 3.04 | |
Intellectual Property | Section 3.14(a) | |
Intervening Event | Section 5.02(e)(i) |
Defined Terms | Defined in Section | |
knowledge | Section 8.09(g) | |
Laws | Section 3.12 | |
Licensed Intellectual Property | Section 3.16(a)(iv) | |
Material Adverse Effect | Section 8.09(h) | |
Material Contract | Section 3.16(a) | |
MBCA | Recitals | |
Medical Device | Section 3.17(f) | |
Merger | Section 1.01 | |
Merger Consideration | Section 8.09(k) | |
Merger Sub | Preamble | |
Nonqualified Deferred Compensation Plan | Section 3.09(p) | |
Notice Period | Section 5.02(e)(i) | |
Notice of Superior Proposal | Section 5.02(e)(ii) | |
OFAC | Section 3.25 | |
OFAC Regulations | Section 3.25 | |
Parent | Preamble | |
Parent Benefit Plan | Section 5.07(a) | |
Parent Expenses | Section 7.03(b)(ii) | |
Paying Agent | Section 2.02(a) | |
Payment Fund | Section 2.02(a) | |
PBGC | Section 3.09(c) | |
Permits | Section 3.12 | |
Person | Section 8.09(i) | |
Plans | Section 3.09(a) | |
Potential Acquirer | Section 5.02(b) | |
Preliminary Proxy Statement | Section 5.09 | |
Proceeding | Section 3.17(i) | |
Program | Section 3.17(i) | |
Proxy Statement | Section 3.07 | |
Real Property Leases | Section 3.15(b) | |
Recommendation Change | Section 5.02(e) | |
Registered Intellectual Property | Section 3.14(b) | |
Release | Section 3.13(d)(iv) | |
Remaining Jurisdictions | Section 8.09(e) | |
Reported Matters | Section 3.18 | |
Sanctions Target | Section 3.25 | |
Sarbanes-Oxley Act | Section 3.05(a) | |
SEC | Section 3.05(a) | |
SEC Reports | Section 3.05(a) | |
Securities Act | Section 3.02(a) | |
Share | Section 1.06 | |
Special Committee | Section 3.03(b) | |
Special Meeting | Section 5.04 | |
Stock Plans | Section 2.04(a) | |
Subsidiary | Section 8.09(j) | |
Subsidiary Securities | Section 3.02(b) | |
Superior Proposal | Section 5.02(g)(ii) | |
Surviving Corporation | Section 1.01 | |
Takeover Laws | Section 3.24 | |
Tax | Section 3.11(l) | |
Third Party Expenses | Section 8.09(m) | |
Voting Agreements | Recitals | |
WARN Act | Section 3.09(o) |
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World Headquarters
710 Medtronic Parkway
Minneapolis, MN 55432-5604
Facsimile: (763) 572-5459
Facsimile: (763) 505-2545
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200 South Sixth Street, Suite 4000
Minneapolis, MN 55402-1425
Attention: John F. Wurm, Esq.
Facsimile: (612) 492-7077
3905 Annapolis Lane, Suite 105
Minneapolis, MN 55447
Attention: Michael D. Dale
Facsimile: (763) 553-0052
50 South Sixth Street
Suite 1500
Minneapolis, MN 55402
Attention: Timothy S. Hearn, Esq.
Facsimile: (612) 340-2868
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MEDTRONIC, INC. | ||||
By: | /s/ Gary L. Ellis | |||
Name: | Gary L. Ellis | |||
Title: | Chief Financial Officer and Senior Vice President | |||
PILGRIM MERGER CORPORATION | ||||
By: | /s/ Gary L. Ellis | |||
Name: | Gary L. Ellis | |||
Title: | Chief Financial Officer and Senior Vice President | |||
ATS MEDICAL, INC. | ||||
By: | /s/ Michael D. Dale | |||
Name: | Michael D. Dale | |||
Title: | Chief Executive Officer and President |
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Essex Woodlands Health Ventures Fund VIII, L.P.
Theodore C. Skokos
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$30,000,000 | , 2010 | |
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(i) | the indebtedness created hereby; | ||
(ii) | the indebtedness to be paid off with proceeds of Advances hereunder and described in the “Use of Proceeds” section above; | ||
(iii) | a line of credit provided by Theodore C. Skokos in an aggregate amount not to exceed $5,000,000; | ||
(iv) | indebtedness secured by Permitted Liens; | ||
(v) | indebtedness of the Borrower to any subsidiary in connection with intercompany cash management transactions entered into in the ordinary course of business; | ||
(vi) | indebtedness of the Borrower as an account party in respect of trade letters of credit; | ||
(vii) | indebtedness in respect of any agreement with respect to any swap, forward, future or derivative transaction or option or similar agreement involving, or settled by reference to, one or more rates, currencies, commodities, equity or debt instruments or securities, or economic, financial or pricing indices or measures of economic, financial or pricing risk or value or any similar transaction or any combination of these transactions; | ||
(viii) | indebtedness arising from the honoring of a bank or other financial institution of a check, draft or other similar instrument drawn against insufficient funds in the ordinary course of business and unpaid for not more than two business days; | ||
(ix) | indebtedness in respect of performance bonds and completion, guarantee, surety and similar bonds, in each case obtained in the ordinary course of business to support statutory and contractual obligations arising in the ordinary course of business; | ||
(x) | indebtedness arising from multi-currency account pooling arrangements in the ordinary course of business; |
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(xi) | obligations owed to customers of Borrower arising from the receipt of advance payments from a customer in the ordinary course of business and consistent with past practices; and | ||
(xii) | additional indebtedness not otherwise identified in the preceding clause in an aggregate outstanding principal amount not to exceed $1,000,000 at any time. |
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If to Borrower, to: | ||
ATS Medical, Inc. | ||
Attention: Michael Kramer | ||
3905 Annapolis Lane, Suite 205 | ||
Minneapolis, MN 55447 | ||
Facsimile: (763) 553-0052 | ||
with a copy to: | ||
ATS Medical, Inc. | ||
Attention: Deb Chapman | ||
3905 Annapolis Lane, Suite 205 | ||
Minneapolis, MN 55447 | ||
Facsimile: (763) 553-0052 | ||
If to Lender, to: | ||
Medtronic, Inc. | ||
World Headquarters | ||
710 Medtronic Parkway | ||
Minneapolis, MN 55432-5604 | ||
with separate copies thereof addressed to: |
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Attention: General Counsel | ||
Facsimile: (763) 572-5459 | ||
and | ||
Attention: Vice President — Corporate Development | ||
Facsimile: (763) 505-2545 |
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ATS Medical, Inc., a Minnesota corporation | ||||||
By: | ||||||
Its: | ||||||
3F Therapeutics, Inc., a Delaware corporation | ||||||
By: | ||||||
Its: | ||||||
ATS Acquisition Corp., a Minnesota corporation | ||||||
By: | ||||||
Its: | ||||||
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ATS MEDICAL, INC. | ||||
By: | ||||
Name: | ||||
Title: | ||||
Suite 105
Minneapolis, MN 55447
Name: | ||||||
Address: | ||||||
Date : , 20___ | (“Holder”) | |||||
By: | ||||||
Its: | ||||||
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ATS Medical, Inc., a Minnesota corporation | ||||
By: | ||||
Its: | ||||
3F Therapeutics, Inc., a Delaware corporation | ||||
By: | ||||
Its: | ||||
ATS Acquisition Corp., a Minnesota corporation | ||||
By: | ||||
Its: | ||||
MEDTRONIC, INC. a Minnesota corporation, as Secured Party | ||||
By: | ||||
Name: | ||||
Title: | ||||
TO SECURITY AGREEMENT
Organizational | ||||||||||||||||
Date of | State of | Identification | Tax Identification | |||||||||||||
Name | Incorporation | Incorporation | Number | Number | ||||||||||||
ATS Medical, Inc. | June 26, 1987 | Minnesota | 5P-793 | 41-1595629 | ||||||||||||
3F Therapeutics, Inc. | June 2, 1998 | Delaware | 2902908 | 33-0819893 | ||||||||||||
ATS Acquisition Corp. | June 15, 2007 | Minnesota | 2399569-2 | 77-0691131 |
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PLEDGOR: | ATS Acquisitions, Inc., a Minnesota corporation | |||
By: | ||||
Name: | ||||
Title: | ||||
Address for Pledgor: | ||||
Medtronic, Inc.
710 Medtronic Parkway, LC 270
Minneapolis, Minnesota 55432
Attention: Vice President, Business Development
STATE OF ) | ||
) ss. | ||
COUNTY OF ) |
Notary Public |
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Owned Stock | ||||||||||||
Jurisdiction of | Certificate | Shares Evidenced by | ||||||||||
Name of Issuer | Incorporation | Number(s) | Each Certificate | |||||||||
ATS Medical France, SARL | France | |||||||||||
ATS Medical GmbH | Germany | |||||||||||
ATS Medical Belgium SPRL | Belgium |
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INDIVIDUAL | ||||
Astrid M. Berthe | ||||
MEDTRONIC, INC. | ||||
By: | ||||
Its: | ||||
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