Sale and Purchase Agreement
between
Schwarz Pharma Aktiengesellschaft
Alfred-Nobel-Strabe 10,
40789 Monheim
Federal Republic of Germany
- - hereinafter sometimes referred to as "Schwarz Pharma AG" or
the "Seller" -
- on the one side -
and
Alpharma GmbH & Co. KG
- hereinafter sometimes referred to as the "Purchaser" -
and
Alpharma Inc.
- hereinafter sometime referred to as the "Parent" -
- one the other side -
Index
Preamble
1 Corporate Ownership/Structure of the Acquisition
2 Sale and Purchase of the Shares
3 Effective Date/Closing Date
4 Purchase Price
5 Financial Statements
6 Net-Equity Guarantee/Adjustment of the Purchase Price
7 Taxes and Other Public Impositions
8 Warranties of the Seller
9 Remedies for Breach of Warranties
10 Warranties of Purchaser
11 Guarantees of the Purchaser and the Parent
12 Reference to Arbiters
13 Right of Companies' Name
14 Inter-Company and other Agreements
15 Antitrust Clearing
16 Costs
17 Assignment of Rights and Undertakings
18 Confidentiality
19 Non-Compete
20 Insurance
21 Notices
22 Arbitration
23 Miscellaneous
Annexes
Annex A: Austrittsvereinbarung zwischen Schwarz
Pharma Aktiengesellschaft und ISIS Pharma GmbH
und Sanol GmbH
Annex B: Notarial Deed on the Transfer of all Shares of
ISIS Pharma GmbH
Annex C: Shareholders' Resolution of ISIS Pharma GmbH
upon the Distribution of the Consolidated Profits
of the Companies
Annex D: Shareholders' Resolution of ISIS Pharma GmbH upon
the Increase of the Capital Surplus
(Kapitalrucklage)
Annex E: Production and Supply Agreement
Annex F: Logistic Agreement
Annex G: Service Agreements
Annex H: Lease Agreement
Annex J: Trademark Licence Agreement with respect to
Obsidan
Annex K: Distribution Agreement with respect to Obsidan
Annex L: Sublicence Agreement with respect to Omeprazol
Annex M: Arbitration Agreement
Annex 4.6: Termination of Certain Contracts
Annex 4.8: Compensation in case of non-transferable ownership
Annex 5.1: Financial Statements of the Companies for the
business year ended December 31, 1998
Annex 5.2: Consolidated Financial Statements for the
business year ended December 31, 1998
Annex 6.10: Example of the calculation of the Adjusted Net
Equity and the payments due
Annex 8.1.1(4): Abstract from the Commercial Register and
Articles of Association of the Companies
Annex 8.1.2:Dividends having been declared or distributed by
ISIS Pharma GmbH since December 31, 1998
Annex 8.1.3: Certain Events between January 1, 1999 and the
Closing Date
Annex 8.1.4 (2): List of Lease Agreements with any payment
obligations of more than DM 100,000 p.a.
Annex 8.1.5 (1a): Industrial Property Rights (Patents,
Design Patents, Trademarks)
Annex 8.1.5 (1b):Violation of any third persons' rights by
Industrial Property Rights or Other Intangible
Property of the Companies
Annex 8.1.5 (2): Industrial Property Rights or Other
Intangible Property granted for use by third
parties including Schwarz Pharma AG and its
affiliated companies
Annex 8.1.5 (3): Industrial Property Rights challenged or
threatended to be challenged by third parties
Annex 8.1. (4): Pentalong - Priority Rights Agreements
Annex 8.1.6 (2): Products of the Companies and Registrations
and Marketing Authorizations
Annex 8.1.6 (3): Pending Actions or Investigations with
respect to Marketing Authorizations
Annex 8.1.6 (5): List of products planned to be placed on the
Market by 2003
Annex 8.1.6 (7): Termination of so called Mitvertriebsrechte
Annex 8.1.7 (1): Guarantees, sureties and similar
undertakings provided by the Companies in favour
of (a) third persons and (b) the Seller and
affiliated companies
Annex 8.1.7 (2): Liabilites, Credit Lines and Loans
outstanding
Annex 8.1.7 (4): All (one time) payments due after the
Closing Date and exceeding an annual amount of DM
100,000 per contract for the licence or purchase
of product registration or dossiers
Annex 8.1.7 (6): Breaches of contracts and contracts related
to Products which are subject to a change of
ownership clause
Annex 8.1.8 (1): List of Employees (which shall exclude Mr.
Grand-Montagne)
Annex 8.1.8 (2): Pension or Old-age Plans or similar
Arrangements with Employees
Annex 8.1.8 (3): Shop-Agreements
Annex 8.1.8 (4): Powers of Attorney and Authority
Annex 8.1.9:Legal Proceedings pending or administrative
investigations opened
Annex 8.1.10 (2):List of Insurance Policies
Annex 8.1.10 (3):Product Liability Claims of the last five
years and products discontinued within the same
period
Annex 9.1: Representatives and advisers of the Purchaser
and/or the Parent
Annex 9.6: List of persons which knowledge is relevant on the
Seller's side
Annex 14.1: Intercompany Agreements which are not terminated
Annex 15.1: Non-action Letter issued by the Federal Cartel
Office (Bundeskartellamt)
Annex 23.1: Termination of a certain employment.
These Annexes are attached to the notarial deed of today
(Notarial Deed No. 645/1999 T of the Notary Public Dr. Jorg
Troder in Dusseldorf, hereinafter referred to as "Reference
Deed"). The parties refer to the Reference Deed. The
individuals thereupon declared that they are aware of the
Reference Deed and waive the right to have the Reference Deed
read to them. Furthermore the individuals declared that they
waive the right to have the Reference Deed attached to this
Agreement. The Notary informed the individuals that the
Reference Deed is an integral part of this Agreement. The
original document of the Reference Deed has been available
during the notarization of this Notarial Deed.
Preamble
WHEREAS Schwarz Pharma Aktiengesellschaft is a stock
corporation/Aktiengesellschaft duly organized under the
laws of the Federal Republic of Germany with registered
offices in Monheim and registered with the Commercial
Register of the Amtsgericht Langenfeld under HRB 1506;
and
WHEREAS Purchaser is a company duly organized under the
laws of the Federal Republic of Germany with registered
offices in Dusseldorf; and
WHEREAS Parent, a Company duly organized under the laws
of Delaware (USA) with registered offices in Ft. Lee, New
Jersey, is the indirect owner of 100% of the equity stock
(Kommanditkapital) of Purchaser.
WHEREAS ISIS Pharma GmbH and its subsidiaries are active
in the marketing and distribution of pharmaceutical
products, in particular but not limited to in the area of
branded generics;
WHEREAS Schwarz Pharma Aktiengesellschaft intends to sell
all of its shares in ISIS Pharma GmbH and its
subsidiaries; and
WHEREAS the Purchaser has had the opportunity to make a
legal, financial and business due diligence review within
the data room provided by Seller, and to receive certain
further information regarding the current financial and
commercial situation of ISIS Pharma GmbH and its
subsidiaries; and
WHEREAS the Purchaser is interested in acquiring all of
the shares of ISIS Pharma GmbH and Seller desires to sell
and to assign all of the shares in ISIS Pharma GmbH to
Purchaser;
NOW, therefore, the parties agreed as follows:
1
Corporate Ownership/
Structure of the Acquisition
1.1 Schwarz Pharma AG is the sole and unrestricted
shareholder of ISIS Pharma GmbH, a limited liability
company/Gesellschaft mit beschraenkter Haftung duly
incorporated and validly existing under German Law with
registered offices in Zwickau/Federal Republic of Germany
and registered with the Commercial Register of the
Amtsgericht Chemnitz under HRB 6549 - hereinafter
sometimes referred to as the "Company".
1.2 The registered (share) capital (Stammkapital) of ISIS
Pharma GmbH amounts to nominal DM 15,000,000.-- and is
divided as follows:
1.2.1 One share in the nominal amount of DM 21,000.-
1.2.2 One share in the nominal amount of DM 29,000.--
1.2.3 One share in the nominal amount of DM 2.950.000.--
1.2.4 One share in the nominal amount of DM 12.000.000,--
DM 15,000,000.--
All contributions to the share capital are fully paid-in
and are non-assessable.
1.3 ISIS Pharma GmbH is the sole and unrestricted shareholder
of ISIS PUREN Verwaltungs GmbH, a limited liability
company/Gesellschaft mit beschraenkter Haftung duly
incorporated and validly existing under German Law with
registered offices in Zwickau/Federal Republic of Germany
and registered with the Commercial Register of the
Amtsgericht Chemnitz under HRB 13918 - hereinafter
sometimes referred to as "ISIS PUREN GmbH".
1.4 The registered (share) capital (Stammkapital) of ISIS
PUREN GmbH amounts to nominal DM 50,000.-- and is divided
as follows:
1.4.1 One share in the nominal amount of DM 32,500.--
1.4.2 One share in the nominal amount of DM 17,500.--
DM 50,000.--
All contributions to the share capital are fully paid-in
and are non-assessable.
1.5 ISIS Pharma GmbH is the sole and unrestricted limited
partner of ISIS PUREN Arzneimittel GmbH & Co. KG, a
limited partnership/Kommanditgesellschaft duly organized
and validly existing under German Law with registered
offices in Zwickau/Federal Republic of Germany and
registered with the Commercial Register of the
Amtsgericht Chemnitz under HRA 3062 - hereinafter
sometimes referred to as "ISIS PUREN GmbH & Co. KG".
1.6 The equity stock (Kommanditkapital) of ISIS PUREN GmbH &
Co. KG amounts to nominal DM 5,000,000.--, and
constitutes the partnership interest (Gesellschaftanteil)
of ISIS Pharma GmbH as the limited partner. The sole
general partner of ISIS PUREN GmbH & Co. KG is ISIS PUREN
GmbH which does not hold any interest in the capital of
said company. All contributions to the equity stock
(Kommanditkapital) are fully paid-in and are non-
assessable.
1.7 ISIS Pharma GmbH is further shareholder of Schwarz & Co.
Immobiliengesellschaft Zwickau and Schwarz & Co.
Industriegebaudegesellschaft Zwickau without any
interests in the capital of said companies. Said
companies are both unlimited partnerships under German
Law with registered offices in Zwickau and registered
under the Commercial Register of the Amtsgericht Chemnitz
under HRA 770 and HRA 769.
1.8 ISIS Pharma GmbH, ISIS PUREN GmbH and ISIS PUREN GmbH &
Co. KG are hereinafter collectively sometimes referred to
as the "Companies".The shares (Geschaftsanteile) of
Schwarz Pharma AG in ISIS Pharma GmbH as described in
Section 1.2 above are hereinafter collectively referred
to as the "Shares".
1.9 Schwarz Pharma AG will sell to the Purchaser and the
Purchaser will purchase from Schwarz Pharma AG all Shares
of Schwarz Pharma AG held in ISIS Pharma GmbH in
accordance with this Agreement.
1.10The shares of ISIS Pharma GmbH in Schwarz & Co.
Immobiliengesellschaft Zwickau and Schwarz & Co.
Industriegebaudegesellschaft Zwickau are not sold to the
Purchaser. ISIS Pharma GmbH will withdraw from said
Companies and thereby ceases to be a shareholder of the
Companies prior to the Closing Date in accordance with
the agreement attached as Annex A to the Reference Deed.
Seller will release and indemnify Purchaser and the
Companies from all possible obligations with regard to
such companies including but not limited to any taxes
such as corporate income tax and real property transfer
taxes resulting from the transactions, if any.
2
Sale and Purchase of the Shares
2.1 Schwarz Pharma AG hereby sells and the Purchaser hereby
purchases, subject to the terms and conditions of this
Agreement with effect as of the Effective Date (Section
3.1), all of the Shares of ISIS Pharma GmbH as described
in Section 1.2 hereof in the aggregate nominal amount of
DM 15,000,000.--.
2.2 The sale and purchase includes any and all rights and
duties attached to such Share as of the Effective Date.
Any and all consolidated profits and dividends of the
Companies for the period as from January 1, 1999 up to
and including the Effective Date shall be for the account
of the Seller and shall be distributed to Seller on the
basis of the shareholders' resolution attached as Annex C
to the Reference Deed and in accordance with the
provisions in Section 6.8 hereof.
2.3 The parties agree that the Shares as sold and purchased
hereunder are not transferred by virtue of this
Agreement. The Shares shall be transferred at the Closing
Date with economical effect as of the Effective Date by
means of a separate notarial transfer document as
attached as Annex B to the Reference Deed.
3
Effective Date/Closing Date
3.1 This Agreement and all transactions contemplated
hereunder shall become effective (erfolgen mit
wirtschaftlicher Wirkung zum) as of June 15, 1999, 24:00
hours - heretofore and hereinafter sometimes referred to
as the "Effective Date".
3.2 The execution of this Agreement and the closing of the
transactions contemplated by this Agreement shall take
place on June 18, 1999 at such place and at such time the
parties will have unanimously agreed upon - heretofore
and hereinafter sometimes referred to as the
"Closing"/"Closing Date".)
3.3 At the closing the following documents shall be delivered
or executed and the following measures shall be taken:
3.3.1 Shareholders' Resolution of ISIS Pharma GmbH upon
the distribution of the consolidated profits of the
Companies for the period from January 1 up to and
including the Effective Date as attached as Annex C to
the Reference Deed.
3.3.2 Shareholders' Resolution of ISIS Pharma GmbH upon
the increase of the capital surplus (Kapitalrucklage)
through Waiver of the Seller with respect to the
repayment of the loan in the amount of DM 50,000,000
granted by the Seller to the Company as attached as Annex
D to the Reference Deed.
3.3.3 Resignation letter of Mr. Noweski as Managing
Director of the Companies with confirmation that he has
no claims or rights against the Companies and
Shareholders' Resolution of ISIS Pharma GmbH and ISIS
PUREN GmbH thereupon
3.3.4 Execution of this Agreement by Notarial Deed
3.3.5 Payment of the Purchase Price
3.3.6 Execution of the Supply Agreement between Schwarz
Pharma AG on the one side and the Purchaser and the
Companies on the other side in accordance with Sec. 14.2
hereof
3.3.7 Execution of the Logistics Agreement between Schwarz
Pharma AG on the one side and the Companies on the other
side in accordance with Section 14.3 hereof
3.3.8 Execution of the Service Agreements between Schwarz
Pharma AG on the one side and the Companies on the other
side in accordance with Sec. 14.4 hereof
3.3.9 Execution of the Lease Agreement in accordance with
Sec. 14.5 hereof
3.3.10 Execution of the Trademark License Agreement between
Schwarz Pharma AG on the one side and the Companies on
the other side in accordance with Section 14.6 hereof
3.3.11 Execution of the Distribution Agreement between
Schwarz Pharma AG on the one side and the Companies on
the other side in accordance with Section 14.7 hereof
3.3.12 Execution of the Sublicense Agreement between
Schwarz Pharma AG on the one side and the Companies on
the other side in accordance with Section 14.8 hereof
3.3.13 Transfer of the Shares by a separate Notarial Deed
in accordance with Sec. 2.3 hereof and in the same form
of Annex B of the Reference Deed.
3.3.14 Delivery of Waiver declaration, by which Seller
waives all option rights, sale rights (Vorkaufsrechte)
and rights of first receipt of an offer
(Voranbietungsrechte), to which Seller might be entitled
regarding the Shares and partnership interests in the
Companies.
4
Purchase Price
4.1 The purchase price for all Shares of the Company sold
under Section 2.1 hereof and representing 100 % of the
total share capital of the Company shall be
DM 285,000,000.00
(say: twohundredeightyfivemillionDeutschmarks)
- hereinafter and heretofore sometimes referred to as the
"Purchase Price".
4.2 The Purchase Price shall become due and payable against
transfer of the Share in accordance with this Agreement
on the Closing Date.
4.3 The Purchase Price shall be paid in Deutschmarks in
immediately available funds to the following bank account
of Seller
Accountholder:Schwarz Pharma AG
Bank: Deutsche Bank AG, Dusseldorf, Filiale
BenrathBank Account: 657 1970
Bank Code: 300 700 10
Payment of the Purchase Price shall be effected on the
Closing Date by wire transfer, free of any bank charges
and commissions.
4.4 Any right of the Purchaser and/or the Companies to set
off and/or to withhold any payments due under this
Agreement and/or any Agreements entered into in
accordance with section 13 hereof is hereby expressly
waived and excluded. Any right of the Companies to set
off and/or to withhold payments due under an Agreement
entered into in accordance with section 13 hereof against
or in connection with claims arising out of or in
connection with the respective Agreement shall not be
affected thereby.
4.5 Schwarz Pharma AG shall return to Purchaser the following
portion of the Purchase Price in the event that the
appropriate German regulatory agency has denied through a
formal letter ("formlicher Ablehnungsbescheid") on or
before the date indicated below the previously applied
for re-registration of Pentalong 50 mg and/or Pentalong
80 mg in accordance with the following stipulations:
Pentalong 50 mg
Amount to be Returned Date of Denial of Registration
DM 21 Million Before July 1, 2000
DM 12 Million On or after July 1, 2000 but on
or before July 1, 2001
Pentalong 80 mg
Amount to be Returned Date of Denial of Registration
DM 14 Million Before July 1, 2000
DM 8 Million On or after July 1, 2000
but
on or before July 1, 2001
Any payment required under this Clause shall be made
within 10 business days after Purchaser provides a copy
of the aforesaid letter of denial ("formlicher
Ablehnungsbescheid") to Schwarz Pharma AG.
4.6 The aforesaid shall apply mutatis mutandis if due to a
change in the German Drug Law (AMG) the present
registrations (fiktive Zulassungen) shall cease by
operation of law (kraft Gesetzes erloschen) although the
Companies have properly and in time performed any and all
obligations and requirements stipulated by the change in
the German Drug Law (AMG) in connection with the re-
registration of Pentalong. Any repayment obligation of
the Seller, however, does only exist if the Purchaser can
evidence assuming the burden of the proof therefore
(beweisen unter Ubernahme der vollen und
uneingeschrankten Beweislast) that the Companies have met
any and all obligations and requirements in accordance
with the change of the German Drug Law (AMG) in a proper
and timely manner. In such case the date of the
publication of the ceasement of the re-registration in
the Federal Gazette (Bundesanzeiger) shall replace the
letter of Denial (formlicher Ablehnungsbescheid).
4.7 The aforesaid agreement about the risk sharing with
respect to the re-registration of Pentalong 50 mg and
Pentalong 80 mg is accepted by Schwarz Pharma AG on the
basis that neither the Purchaser nor the Parent or any of
the Companies or any of their employees, representatives
or advisers shall make any declarations towards the
competent authorities in connection with the pending re-
registration process without prior consultation with and
the written consent of the Schwarz Pharma AG, which shall
not be unreasonably withheld in order to enable the
Purchaser to truthfully, accurately and timely make all
filings required by law or truthfully and accurately
respond to inquiries of the governmental authorities.
4.8 Schwarz Pharma AG shall further return to Purchaser
portions of the Purchase Price in the event that certain
contracts are terminated as specified in Annex 4.8 to the
Reference Deed in more detail.
5
Financial Statements
5.1 Schwarz Pharma AG has submitted to the Purchaser the
audited financial statements (balance sheet, profit and
loss account and the annex) of the Companies for the
business year ended December 31, 1998 prepared in
accordance with generally accepted accounting and
valuation principles under German law, including the
auditing reports and the auditor's unqualified
certificates (hereinafter sometimes collectively referred
to as "Financial Statements"). The Financial Statements
(without the auditing reports) are attached as Annex 5.1
to the Reference Deed.
5.2 Schwarz Pharma AG has further submitted to the Purchaser,
on the basis of the Financial Statements, consolidated
financial statements for the business year ended
December 31, 1998 prepared in accordance with generally
accepted accounting and valuation principles under German
law (hereinafter sometimes referred to as the
"Consolidated Financial Statements"). The Consolidated
Financial Statements are attached as Annex 5.2 to the
Reference Deed.
5.3 Schwarz Pharma AG shall establish financial statements
(balance sheet, profit and loss account and the annex) of
the Companies for the period from January 1, 1999 through
the Effective Date (hereinafter sometimes referred to as
"Interim Financial Statements").
5.4 The Interim Financial Statements shall be prepared on the
basis of a physical inventory and shall be prepared in
accordance with generally accepted accounting and
valuation principles under German Law as consistently
applied by the Companies. For the purpose of computing
the distributable profits, a German corporate income tax
rate of 30% upon the taxable income shall be applied
which shall be reflected in the Interim Financial
Statements. Irrespective hereof the distributable profits
shall not be reflected in the Interim Financial
Statements as liabilities vis a vis the Seller but shall
be accounted for as part of the stockholders equity. The
pension obligations assumed by the Companies vis a vis
the employees the employmentship of which has been
transferred from the Schwarz Pharma AG to the Companies
as identified in Annex 8.1.8 (1) to the Reference Deed
shall be provided for in the Interim Financial Statements
irrespective of at what time such transfer has taken
place.
5.5 Schwarz Pharma AG shall further establish on the basis of
the Interim Financial Statements of the Companies
consolidated financial statements for the period from
January 1, 1999 through the Effective Date - hereinafter
sometimes referred to as "Interim Consolidated Financial
Statements". The Interim Consolidated Financial
Statements shall be prepared in accordance with generally
accepted accounting and valuation principles under German
law to be applied consistently with the Consolidated
Financial Statements.; within such Interim Consolidated
Financial Statements, the capitalized goodwill of the
business of Puren for the period from January 1, 1999
through the Effective Date shall be depreciated at a rate
of 6.67% per annum. In determining the amount of deferred
taxes on the Closing Consolidated Financial Statements
the amount of deferred taxes on the Consolidated
Financial Statements shall be deemed to be correct and no
further deferred taxes shall be build for the periods up
to and including December 31, 1998. Section 7 shall not
be affected by the previous sentence. The last two
sentences of Clause 5.4 shall apply mutatis mutandis.
5.6 The Interim Financial Statements and the Interim
Consolidated Financial Statements shall be audited by
Deloitte & Touche GmbH Wirtschaftsprufungsgesellschaft
("Deloitte") as the Companies' auditors.
5.7 The Purchaser is entitled to review the Interim Financial
Statements and Interim Consolidated Financial Statements
by PriceWaterhouseCoopers GmbH Wirt
chaftsprufungsgesellschaft ("PriceWaterhouseCoopers") as
the auditors of the Purchaser.
5.8 Schwarz Pharma AG will do its best efforts to submit the
audited Interim Financial Statements and the audited
Interim Consolidated Financial Statements to the
Purchaser not later than August 15, 1999. Schwarz Pharma
AG and the Companies will release Deloitte as the
Companies' auditors from its professional secrecy
obligations and authorize Deloitte to grant access to
PriceWaterhouseCoopers as the auditor of the Purchaser
with respect to its papers and audit records.
5.9 If the Purchaser does not notify Schwarz Pharma AG within
30 days following receipt of the audited Interim
Financial Statements and the audited Interim Consolidated
Financial Statements according to Section 5.8 hereof that
it has any objections against any of the aforesaid
financial statements, specifying in writing each
individual item and the reasons for the objections
thereupon, the audited Interim Financial Statements and
the audited Interim Consolidated Financial Statements
shall become the final Closing Financial Statements and
the final Closing Consolidated Financial Statements for
the purpose of this Agreement - hereinafter sometimes
collectively referred to as the "Closing Financial
Statements".
5.10If the Purchaser does notify Schwarz Pharma AG within 30
days following receipt of the Interim Financial
Statements, the Interim Consolidated Financial Statements
and the auditors' reports of any objections to the
aforesaid financial statements, specifying in writing
each individual item objected to and the reason for the
objections thereupon, both parties shall then try to
reach an agreement in the adjustment required to the
Interim Financial Statements and/or the Interim
Consolidated Financial Statements. If the parties are
unable to reach an agreement on the aforesaid financial
statements within 30 days of receipt of the Purchaser'
objections by Schwarz Pharma AG, the items in dispute
shall be referred to the arbiters proceedings referred to
in Section 11 in order to obtain the Closing Financial
Statements.
5.11All costs arising out of and in connection with the audit
of the Interim Financial Statements and the Interim
Consolidated Financial Statements referred to in this
Section 5 shall be borne by theSeller. All costs arising
out of and in connection with any review of such
financial statements referred to in this Section 5 by the
Purchaser shall be borne by Purchaser. All external and
internal labour costs and other internal costs and
expenses of the Companies for the preparation and
establishment of the Interim Financial Statements and the
Interim Consolidated Financial Statements shall be borne
by the Companies but shall not be accrued and provided
for (nicht als Verbindlichkeiten auszuweisen oder
zuruckzustellen) in such financial statements.
5.12Purchaser and Parent shall procure that the Companies
assist Seller in any respect and to the extent necessary
to establish the Interim Financial Statements and the
Closing Consolidated Financial Statements, including
provision of unrestricted access to all Companies' data
required for the establishment of such financial
statements and of personnel qualified for such task also
including assistance by the management of the Companies
which shall for this purpose be subject to the
instructions of the Seller.
6
Net-Equity Guarantee/Adjustment of the Purchase Price
6.1 Schwarz Pharma AG hereby guarantees that the Adjusted Net-
Equity , as hereinafter defined, of ISIS Pharma GmbH at
book value as of the Effective Date and as reflected in
the Closing Consolidated Financial Statements shall
amount to at least DM 81,288,000 (say:
eightyonemilliontwohundredeightyeightthousand
Deutschmarks) in the aggregate, provided however that the
sum set forth in this sentence shall be increased by any
interest on the DM 50 million Shareholders'loan for the
period from January 1, 1998 through December 31, 1998 not
being settled by the Companies at the latest on December
31, 1998.
6.2 For purposes of this Agreement and the consummation of
the transactions contemplated hereunder, "Adjusted Net-
Equity" shall be defined as (a) the total of all assets
other than cash and cash equivalents minus (b) the total
of all liabilities other than stockholders' equity and
liabilities due to banks and accounts due to the Seller
and its affiliated companies, except trade payables due
to the Seller and its affiliated companies
(Verbindlichkeiten aus Lieferungen und Leistungen
gegenuber der Verkauferin und ihren verbundenen
Unternehmen), each as reflected in the Closing
Consolidated Financial Statements plus (c) a deemed
amount of DM 1 million in recognition of the depreciation
of the capitalized goodwill of the business of Puren for
the period from January 1, 1999 through the Effective
Date in accordance with Section 5.5 hereof. For the
purpose of this Section 6, the term "cash and cash
equivalent" shall have the meaning as defined in Section
266 para 2 lit. B. IV. German Commercial Code (HGB), and
the term "trade payables" shall mean obligations in
connection with the purchase of goods by the Companies or
the provision of services to the Companies as defined in
Section 266 para 3 lit. C 4. German Commercial Code
(HGB).
6.3 The parties will use their best efforts to hold a Post-
Closing ("Post-Closing") on September 20, 1999 (the "Post-
Closing Date") for the purpose of establishing the
Adjusted Net Equity as of the Effective Date.
6.4 In the event that (a) the Adjusted Net-Equity on the
Closing Consolidated Financial Statements plus (b) cash
and cash equivalents on the Consolidated Closing
Financial Statements ("Closing Cash") minus (c) any
dividends (Bardividenden) the Seller is entitled to in
accordance with section 2.2 and Annex C to the Reference
Deed ("Dividend 1999") exceeds the amount as referred to
in Section 6.1 above, the exceeding amount shall be paid
by the Purchaser to the Seller on the Post-Closing Date -
hereinafter sometimes referred to as the "Additional
Purchase Price".
6.5 Payments to be made by the Seller according to Section
6.4 above shall bear interest at the annual rate of 4 %
from the Effective Date to the date of payment.
6.6 In the event that (a) the Adjusted Net-Equity on the
Closing Consolidated Financial Statements plus (b) the
Closing Cash minus (c) the Dividend 1999 is less than the
amount referred to in Section 6.1 above, the amount of
the deficiency shall be paid to the Purchaser on the Post-
Closing Date.
6.7 Payments to be made by Schwarz Pharma AG according to
Section 6.6 above shall bear interest at an annual rate
of 4 % from the Effective Date through the date of
payment.
6.8 The Dividend 1999 shall be distributed by ISIS Pharma
GmbH to the Seller in accordance with the shareholders'
resolution attached as Annex C to the Reference Deed at
the latest on the Post Closing Date. Any payment of the
Dividend 1999 prior to the Post Closing Date shall be
limited to the cash or cash equivalent available in the
Companies on the Effective Date. The Purchaser and the
Parent guarantee the
proper payment of any part of the Dividend 1999 remaining
after any cash payment made pursuant to this clause 6.8.
6.9 If and to the extent that any liabilities due to banks
and accounts due to the Seller and its affiliated
companies, except trade payables due to the Seller and
its affiliated companies are reflected in the Closing
Consolidated Financial Statements, the Seller shall
reimburse to the Purchaser the amount of such liabilities
and accounts at the Post-Closing Date. In such case, the
Purchaser, however, guarantees that the Companies will
fully comply with their obligations out of and in
connection with such liabilities and accounts.
6.10For clarity the parties agree that, had the Closing Date
been April 30, 1999, the calculation of the Adjusted Net
Equity and the payments due under this clause 6 would
have been as set forth in Annex 6.10 to the Reference
Deed.
6.11The payment of the Purchase Price in accordance with
Section 4 hereof shall not be affected by any of the
foregoing provisions.
6.12The guarantee assumed by the Seller under Clause 6.1 and
the undertaking of the Seller under Clause 6.9 above
shall not survive the Post Closing Date provided that the
payments of Seller required by this Clause 6 are fully
made.
7
Taxes and Other Public Impositions
7.1 The Seller hereby represents and warrants to the
Purchaser, effective as of the Closing Date, that the
Companies have filed all returns with regard to taxes,
public impositions and charges as defined in the German
Fiscal Code (Steuern, Abgaben und Gebuhren im Sinne der
Abgabenordnung) and all social security contributions
(Sozialabgaben) including any interest and penalties
thereupon (steuerliche Nebenleistungen im Sinne der
Abgabenordnung oder vergleichbare Leistungen in bezug auf
Sozialabgaben) - hereinafter sometimes collectively
referred to as "Taxes and other Public Impositions" -
required to be filed by the Companies up to the Effective
Date under any mandatory law, and all Taxes and other
Public Impositions related to any time period up to the
Effective Date have been paid by, or will have been
accrued and provided for in the Closing Financial
Statements and none of the Companies have waived any
statute of limitation in respect of Taxes or agreed to
any extention of time with respect to a tax assessment
and there are no liens of any Taxes.
7.2 The Seller shall reimburse the Purchaser any amounts due
as outstanding Taxes and other Public Impositions
assessed or to be assessed against any or all of the
Companies for any time period up to the Effective Date
including Taxes on distributed profits for said period,
regardless of when paid except to the extent any taxes
are withheld from said distribution after the Closing
Date (mit Ausnahme einbehaltener und abzufuhrender
Kapitalertragsteuer), provided, however, that this shall
not apply with respect to any applicable tax rate other
than that agreed upon in section 5.4 on the following
terms and conditions.
7.2.1 In calculating any amount payable by the Seller
hereunder, the relevant amount of Taxes and other Public
Impositions assessed shall first be reduced by the amount
of accruals and provisions made for Taxes and other
Public Impositions in the Closing Financial Statements,
if any.
7.2.2 Secondly, any amount of Taxes and other Public
Impositions payable by the Seller hereunder shall be
further reduced by the amount of any refund of Taxes and
other Public Impositions to the extent not capitalized in
the Closing Financial Statements for any time periods up
to the Effective Date, which the Companies may receive in
cash or by means of setoff from their liabilities for
Taxes and other Public Impositions before or after the
Effective Date.
7.2.3 Thirdly, if a tax field audit of the Companies for
any time period up to and including the Effective Date
results in a step-up in the tax basis of capitalized
assets, or in the first-time capitalization of assets for
tax purposes, which provides the Companies with a
potential of increased depreciation on such assets in
subsequent time periods, then all possible corresponding
net reductions of Taxes and other Public Impositions due
by the relevant Companies in subsequent time periods
shall be calculated on the basis of a deemed total tax
rate of 40 % and their aggregate net present value
(applying a discount rate of 8 %) at the Effective Date
shall be deducted from any amount of Taxes and other
Public Impositions payable by the Seller under this
Section 7. The aforesaid shall not apply to the extent
that the same tax field audit results in a decrease in
the tax basis of capitalized assets, which provides the
Companies with a potential of decreased depreciation on
such assets in subsequent time periods; in such event,
possible corresponding net increases of Taxes and other
Public Impositions due by the relevant Companies in
subsequent time periods shall be caluclated on the basis
of a deemed total tax rate of 40 % and their aggregate
net present value (applying a discount rate of 8 %) at
the Effective Date shall be set-off against the net
present value set out in the previous sentence. For the
avoidance of doubt, the Seller shall not compensate the
Purchaser any net present value of potential decreased
depreciation exceeding any net present value of potential
increased depreciation.
7.3 Any refund of Taxes and other Public Impositions to the
Companies for any time periods up to the Effective Date,
which the Companies may receive in cash or by means of
setoff from their liabilities for Taxes and other Public
Impositions which are not capitalized in the Closing
Financial Statements and which are not reducted from any
payments due by the Seller under Section 7.2 hereof shall
be reimbursed by the Purchaser to the Seller in cash.
7.4 The Purchaser is not entitled to any payment under this
Section, if the aggregate amount of all claims does not
exceed DM -50,000.--. In case the aggregate amount of DM
50,000.-- is exceeded the Purchaser can only claim the
exceeding amount.
7.5 All claims of the Purchaser in connection with Taxes and
other Public Impositions shall become statute-barred
within six (6) months from the date upon which the
assessment, or any amended assessment, of the relevant
Taxes and other Public Impositions becomes res iudicata.
7.6 The Purchaser shall immediately notify the Seller of any
tax audit of the Companies and any announcement thereof
relating to any time period up to the Effective Date. The
Seller and/or its representative shall be given full
access to and the right to participate in such tax audit
and to contest, where possible, any findings and/or
assessments of the relevant tax authorities which relate
to time periods up to the Effective Date. Any such tax
audit shall be conducted under the exclusive control of
the Seller for which purposes the Purchaser shall cause
the Companies to appoint such advisers nominated by the
Seller as their sole representatives vis a vis the
relevant authorities and to refrain from any statements
or declarations vis a vis the authorities without the
prior approval of the Seller or the representatives
nominated. The representatives nominated by Seller and to
be appointed by the Companies shall be released by the
Companies from their secrecy obligation vis a vis the
Seller and shall have the unrestricted authority to make
any statements and declarations, subject to any
instructions of the Seller, in the name and on behalf of
the Companies vis a vis the authorities in connection
with such tax audits; the representatives shall further
be appointed as process agent (Zustellungsbevollmach
tigter) of the Companies. The representatives so
appointed shall inform the Companies about any filings
made in connection with the tax audits and shall discuss
any filings with the Companies which may have an material
adverse impact on the tax situation of the Companies for
the periods after the Effective Date; in case of the
latter the Seller and the Purchaser will unanimously and
in good faith take a decision which balances the
interests of both parties. The Purchaser shall upon the
request of the Seller further cause the Companies to
initiate appropriate appeals proceedings to contest
assessments for Taxes and other Public Impositions
relating to time periods up to the Effective Date and,
where necessary, take the matter to the appropriate
courts in accordance with the instructions of the Seller.
The aforesaid provisions shall apply mutatis mutandis to
any such proceedings. The costs of any such
administrative and/or legal proceedings and actions shall
be borne by the Seller.
7.7 If the Purchaser fails to notify the Seller of any tax
audit of the Companies and any announcements thereof in
due time, which prevents the Seller and/or any of its
representatives to participate in such tax audit from the
very beginning, or if the Seller and/or any of its
representatives is not given full access to and the right
to participate in and control of such tax audit in due
time or if the Companies do not comply with any other of
the stipulations pursuant to Section 7.6 hereof or do not
initiate appropriate appeals proceeding to contest
assessments for Taxes and other Public Impositions upon
request of the Seller in a proper form, any claims of the
Purchaser and/or the Companies under this Section 7 out
of and in connection with such tax audit are hereby
expressly waived and excluded.
7.8 Any upside or downside adjustments of taxable income
("steuerliche Mehr- und Minderergebnisse") resulting from
any tax audit and any additional liability or refund of
the Companies for Taxes and other Public Impositions for
time periods up to and including the Effective Date which
the other party may become aware of, shall not affect the
Purchase Price and shall not have any impact on the Net
Equity as reflected in the Closing Financial Statements.
Furthermore, the Seller is in such case not entitled to
any further distribution of profits nor is he obliged to
pay back any profits already received.
8
Warranties of the Seller
8.1 Schwarz Pharma AG hereby represents and warrants to the
Purchaser by way of an independent guarantee in
accordance with 305 German Civil Code (gewahrleistet in
Form eines selbstandigen Garantieversprechens i.S.d. 305
BGB),- subject to the provision of Section 9.3 - that the
following statements and declarations are true and
correct as of the Closing Date:
8.1.1 Corporate Issues and Authority of the Seller
(1) The Companies are properly organized and validly
existing under the laws of the Federal Republic of
Germany. The statements in Sec. 1 of this agreement
relating to the Companies, the shares and the
subsidiaries are complete and correct in every
respect. The Shares have been continously held for
the last ten (10) years by Corporations or
individuals who: (1) are entitled to German income
tax credit, and (2) would be subject to tax on the
sale of the Shares. The Companies have the corporate
power to carry on their respective business as it is
now conducted. All information and data regarding
ownership, corporate rights and privileges of
Schwarz Pharma AG and the Companies, as specifically
referred to in Section 1 above, are true and
correct. All resolutions and other documents
necessary to be filed with the Commercial Registers
of the Companies have been duly filed and were
correct once filed.
(2) All contributions to the share capital
(Stammkapital) and the equity stock
(Kommanditkapital) of the Companies are fully paid-
in and are non-assessable and no repayments have
been made. All applicable provisions under the
respective laws have been duly observed, in
particular regarding the increase of the share
capital of the Companies. The Shares are validly
existing, free and clear of any lien, rights and
privileges of third parties and Schwarz Pharma AG
may freely dispose of the Shares without limitations
or restrictions. There are no options, shareholder
agreements or understanding with respect to the
Shares or the Interests including without limitation
individual shareholders' rights.
(3) The execution, delivery and performance of this
Agreement including the transactions contemplated
hereunder do not violate any other undertakings or
obligations of Schwarz Pharma AG. Schwarz Pharma AG
has the full authority to enter into this Agreement
and to perform its obligations hereunder.
(4) Annex 8.1.1(4) to the Reference Deed contains a
most recent abstract from the competent Commercial
Register and the true, accurate and complete version
of the articles of association of the Companies
presently valid and in full force and effect. All of
the corporate rights and obligations of the
shareholders are fully and exclusively contained in
such Articles of Associations as far as not provided
by law or mentioned in this Agreement, and no
changes have been made to the Articles of
Association and the Commercial Register. The
Companies do not have established a Supervisory
Board or any similar corporate board such as a so-
called "Verwaltungrat" or "Beirat" or the like.
(5) The Companies and any of its subsidiaries are
not bound by a domination or profit and loss
absorption agreement (Beherrschungs- und/oder
Gewinnabfuhrungsvertrag) or any other agreements
(andere Unternehmensvertrage) within the meaning of
Art. 291 et seq. of the German Stock Corporation
Act.
(6) The Companies do not own or hold any other
equity, interest or shares in any other legal entity
(Gesellschaft) and are not party to any joint-
venture agreement.
(7) With the transfer of the Shares in accordance
with Sec. 2 Purchaser acquires full unrestricted and
unencumbered title to such Shares, to his free
disposition.
(8) The Companies are neither overindebted nor
insolvent (uberschuldet oder zahlungsunfahig).
8.1.2 Financial Statements
(1) Schwarz Pharma AG has delivered to the Purchaser the
audited Financial Statements of the Companies for
the business year ended December 31, 1998. The
Financial Statements have been prepared in
accordance with generally accepted accounting and
valuation principles as applied in the past. The
Financial Statements give a true and fair view of
the financial status and of the results of
operations of the Companies within the meaning of
264 para. 2 German Commercial Code/HGB at the
relevant date of the balance sheet.
(2) The Closing Financial Statements will be prepared in
accordance with generally accepted accounting and
valuation principles as more specifically described
in Section 5.4. The Closing Financial Statements
will give a true and fair view of the financial
status and of the results of operations of the
Companies within the meaning of 264 para. 2 German
Commercial Code/HGB at the relevant date of the
balance sheet.
(3) Since December 31, 1998, no dividends have been
declared or distributed (sind keine offenen
Gewinnausschuttungen beschlossen oder vorgenommen
worden) by the Company to the Seller other than
those stated in Annex 8.1.2 to the Reference Deed.
(4) The stock (Vorrate) stated in the Closing
Financial Statements is only encumbered with title
retention rights or other securities for liabilities
which came into existance during the ordinary course
of the business.
(5) The Companies have no liabilities or repayment
obligations with regard to public grants except
those accrued and provided for in the Closing
Financial Statements.
(6) The Companies have no liabilities due to banks
or other accounts due to the Seller and its
affiliated companies as of the Effective Date,
except trade payables due to the Seller and its
affiliated Companies other than those to be
reimbursed by the Seller to the Purchaser in
accordance with Section 6.9 hereof
8.1.3 Course of Business as of January 1, 1999 through the
Closing Date
During the period from January 1, 1999 up to the Closing
Date, the Companies have been operated in the ordinary
course of business and in accordance with this Agreement.
In particular, there has not been to the extent not
disclosed in Annex 8.1.3 to the Reference Deed to the
Purchaser:
(i) any material adverse effect on the properties,
business and financial position of the Companies;
(ii)any material sale, lease, transfer or
assignment of any assets, tangible or intangible, of
the Companies, other than in the ordinary course of
business;
(iii) any material damage, destruction or loss,
whether or not covered by an insurance;
(iv)any mortgage or pledge of, or any subjection to
any lien, charge, security interest or encumbrance
of any kind of the Shares, or on any of the assets
of the Companies;
(v) any increase or commitment to increase the
compensation of employees, other than in the
ordinary course of business, or as necessitated by
legal requirements or any applicable collective
bargaining agreements.
8.1.4 Real Estate and Tangible Assets
(1) The Companies do not own any real estate and there
are no obligations and liabilities of or claims
against the Companies arising out of or in
connection with ownership or use of real estate in
the past, except those accrued and provided for in
the Closing Financial Statements for the real estate
presently leased in Monheim and Zwickau.
(2) The operational and office equipment belonging to
the business of the Companies as of the Effective
Date is reflected in the Closing Financial
Statements, and these assets are the sole property
of the Companies or are leased by them, not subject
to any rights, liens or interest of third parties
except as subject to statutory liens and retention
of title clauses in the ordinary course of business
which do not materially and adversely affect the
Companies use of said assets. All such assets are in
satisfactory operating condition and in a normal
state of maintenance and repair, except for normal
wear and tear of such property. All assets leased
under agreements requiring in each individual case
the payment of more than DM 100,000.-- per annum are
listed in Annex 8.1.4 (2) to the Reference Deed.
8.1.5 Intangible Assets
(1) The Companies have registered or are the licensee
under such patents, de-
sign patents and trademarks as identified in Annex
8.1.5 (1a) to the Reference Deed (hereinafter
collectively referred to as the "Industrial Property
Rights") attached. To the best knowledge of the
Seller, the Industrial Property Rights and all other
trade secrets, know-how, technical and manufacturing
processess (Other Intangible Property) presently
used in the business of the Companies do not violate
the rights of any third persons and the Companies
have the right to use the same in the business of
the Companies as it is presently conducted and as
they are presently used, except as disclosed in
Annex 8.1.5 (1b) to the Reference Deed.
(2) The Companies have granted only such licences to use
the Industrial Property Rights or the Other
Intangible Property to any third party including the
Seller and his affiliated companies as are listed in
Annex 8.1.5 (2) to the Reference Deed.
(3) To the best knowledge of the Seller third
parties do not infringe the Industrial Property
Rights of the Companies and the products sold by the
Companies do not infringe or conflict with any
intellectual property rights of any other person.
Third parties neither have challenged nor have
threatened in writing to challenge the Industrial
Property Rights by means of filing objections or
taking action for cancellations, except as disclosed
in Annex 8.1.5 (3) to the Reference Deed.
(4) The representations and warranties under this
section 8.1.5 are subject to (stehen unter dem
Vorbehalt von) all priority rights agreements
(Vorrechtsvereinbarungen) the Companies have entered
into in the normal course of business relating to
trademarks provided that those priority rights
agreements with respect to the trademark "Pentalong"
are listed in Annex 8.1.5(4) to the Reference Deed.
8.1.6 Permits and Licences
(1) All general public permits and licences required for
the conduct of the
business of the Companies have been obtained and are
in full force and effect.
(2) The Companies hold for each of its products all
necessary registrations (fiktive Zulassungen) or
marketing authorizations (arzneimittelrechtliche
Zulassungen) or so-called "Mitvertriebsrechte" for
the sale of the products of the Companies in the
Federal Republic of Germany. The products and the
respective registrations, marketing authorizations
or Mitvertriebsrechte are listed in Annex 8.1.6 (2)
to the Reference Deed. Such Annex will show the
current status of the registrations, marketing
authorizations or Mitvertriebsrechte and the
relevant information under which law and regulation
the registrations, marketing authorizations or
Mitvertriebsrechte have been obtained and whether or
not the Companies have received and/or answered any
deficiency letters (Mangelbescheide).
(3) All marketing authorizations are valid and have been
issued pursuant to applications or filings made in
accordance with the applicable laws and regulations
in all material respect. All applications for
renewal, for subsequent admission and other filings
necessary to obtain or maintain the right to market
the products have been filed in due time. To the
best knowledge of the Seller, all conditions imposed
by the German Regulatory Authorities in connection
with the marketing authorizations have been complied
with. There is no pending action or investigation
against the Companies by any governmental authority
(behordlicherseits eingeleitete und den
Gesellschaften mitgeteilte Verwaltungsverfahren oder
Untersuchungen) or by any third party (erhobener und
den Gesellschaften mitgeteilter Drittwiderspruch) to
withdraw, revoke, suspend or limit the present scope
of use of any marketing authorization nor is there
any written notice explicitly threatening to
commence such actions or investigations except those
disclosed in Annex 8.1.6 (3) to the Reference Deed.
(4) All applications and filings regarding the products
listed in Annex 8.1.6 (2) to the Reference Deed have
been made without breach of any contractual
obligation of the Companies in relation to any third
party and to the best knowledge of the Seller
without infringement of any other right or property
of any third party.
(5) The products which have not yet been placed on the
market but which are planned to be placed on the
market by the year 2003 are specified in Annex 8.1.6
(5) to the Reference Deed. This Annex also shows the
calendar quarter for which the introduction on the
market is contemplated. As far as applications for
marketing authorizations have already been filed by
the Companies, but not granted to the Companies,
they, to the best knowledge of the Seller, were
filed without infringing third parties' rights. It
is hereby expressly stated and confirmed by the
Purchaser that no representations and warranties are
assumed by the Seller with respect to the granting
of marketing authorizations for such products
specified in Annex 8.1.6 (5) to the Reference Deed
by making the statements in this Section or
otherwise, whether explicitly nor implicitly.
(6) To the knowledge of Seller, the Companies are
not in violation of any law which has a material
adverse effect on the business or the assets of the
Companies.
(7) To the knowledge of the Seller the
Mitvertriebsrechte have not been terminated nor have
they been threatened in writing to be terminated
except as disclosed in Annex 8.1.6 (7) to the
Reference Deed.
8.1.7 Major Contracts and Obligations
(1) The Companies have given no guarantees, sureties or
similar undertakings surviving the Effective Date to
secure liabilities of (a) third persons, or (b)
liabilities of the Seller and its affiliated
companies except those disclosed in Annex 8.1.7 (1)
to the Reference Deed.
(2) As of the Effective Date there are no credit lines
with banks, and no loans outstanding, except those
liabilities, credit lines and loans outstanding as
are disclosed in Annex 8.1.7 (2) to the Reference
Deed other than those to be reimbursed by the Seller
to the Purchaser in accordance with Sec. 6.9 hereof.
(3) There are no further contracts entered into by
the Companies which were not disclosed to the
Purchaser in the Data Room , which in each case
might result in a liability of the Companies in
excess of DM 250,000.-- or which in each case might
lead to an obligation of the Companies with a value
in excess of DM 250,000.--.
(4) Annex 8.1.7(4) to the Reference Deed lists all
payments due after the Closing Date and exceeding an
annual amount of DM 100,000 per contract for the
licence or purchase of products, registration or
dossiers, provided, however, that such Annex does
not list any royalties and the like or other
payments based upon the sales level (umsatzabhangige
Vergutungen) of the Companies.
(5) The Companies are not party or subject to
(a) contractual competition restraints to
the detriment of the Companies or
(b) any judgement or order rendered by
court or administrative proceedings or any
settlement entered in such context which would
substantially impair or restrict the Companies
in their businesses as presently conducted
(6) The Companies are not in breach of any
contracts which might result in a liability of the
Companies in excess of DM 250,000 in each individual
case, or which, in each individual case might lead
to an obligation of the Companies with a value in
excess of DM 250,000, and there are no such
contracts directly related to the Products which are
subject to change of ownership clauses except those
as disclosed in Annex 8.1.7(6) to the Reference
Deed.
(7) The manufacturing and related assets
transferred to Schwarz Pharma AG by the Companies on
or about December 31, 1998, included a transfer to
Schwarz Pharma AG of all liabilities (whether known,
unknown, absolute or contingent) relating directly
or indirectly to the manufacturing business,
operation and assets of the Companies except those
as accrued and provided for in the Closing Financial
Statements, and the Companies do not have any other
liabilities (whether known, unknown, absolute or
contingent) from any other manufacturing activities.
8.1.8 Labour Matters
(1) The Companies employ not more than 185 employees
details of which are listed in Annex 8.1.8 (1) to
the Reference Deed. Employees identified as
"Austritt 30.6." and the five
"Leiharbeitsverhaltnisse" do not count. Such Annex
contains all relevant information about the salaries
and bonuses the employees are entitled to.
(2) There are in excess of any statutory rights
(gesetzliche Rentenversicherung) no pension or old-
age plans or similar arrangements with employees,
except those disclosed in Annex 8.1.8 (2) to the
Reference Deed or with respect to former employees
of the Seller as provided for in the Closing
financial statement.
(3) The Companies have only entered into such shop-
agreements (Betriebsvereinbarungen), as referred to
in Annex 8.1.8 (3) to the Reference Deed.
(4) Only those persons who are referred to in Annex
8.1.8 (4) to the Reference Deed attached to the
Reference Deed have power of attorney and authority
(gesetzliche Vertretungsmacht oder Bankvollmacht) to
sign and to represent the Companies in general or
vis-a-vis banks or other financial institutions.
8.1.9 Litigation
There are no legal proceedings pending
(Rechtsstreitigkeiten anhangig) or administrative
investigations opened by any public authority
(behordlicherseits eroffnete und den Gesellschaften
mitgeteilte offentlich-rechtliche Verwaltungsverfahren),
or - to the knowledge of Seller - threatened explicitly
in writing, to which the Companies or - resulting from
the business and the operation of the Companies - its
management are a party as defendant or plaintiff, or
which to Seller's knowledge could adversely affect the
Companies' business or assets except those proceedings
which are disclosed in Annex 8.1.9 to the Reference Deed.
8.1.10 Product Liability/Insurance
(1) There are no reasons to believe, after the inquiry
and investigation of the senior staff and management
of the Companies, that product liability claims
might be brought against the Companies.
(2) Annex 8.1.10 (2) to the Reference Deed contains a
true, accurate and complete list of all insurance
policies applicable to the Companies (and its
respective business and assets). The Companies have
performed all obligations arising out of such
insurance contracts except those which are accrued
and provided for in the Closing Financial
Statements. All insurances are in full force and
effect for the period up to the Closing Date.
(3) Annex 8.1.10 (3) to the Reference Deed lists all
product liability claims existing within the last
five (5) years and all products discontinued within
the same time period.
8.1.11 Environmental
There is no liability, whether asserted or unasserted,
fixed or contingent, relating to the property presently,
or prior hereto, leased or used by the Companies which
results from any environmental matters, including, the
use, discharge, disposal, storage, accumulation,
transport, leakage, spillage or other actions by the
Companies with respect to any harmful or toxic
substances, hazardous waste or other pollutants,
contaminants or nuisances and no claim has been made with
respect to the operation of facilities of the Companies
resulting from any harmful substance, hazardous waste or
from any asbestos or similar materials used in the
construction thereof and there is no valid basis for any
such claim.
8.1.12 Miscellaneous
(1) Neither the Purchaser nor any affiliate of the
Purchaser nor the Companies has or shall have any
liability or otherwise suffer or incur any loss,
cost or damage as a result of or in connection with
any brokerage or finder's fee or other commission of
any person retained by the Seller or the Companies
in connection with any of the transactions
contemplated by this Agreement.
(2) The Companies have no liabilities or
obligations out of the acquisitions of the Companies
by Seller or by ISIS PHARMA GmbH, including without
limitation obligations to make certain investments
or to employ a certain number of employees except as
to obligations under licence agreements with respect
to Products of the Companies are concerned.
(3) The Companies have no liabilities or repayment
obligations with regard to public grants.
8.2 No further representations and warranties of whatsoever
nature and on whatsoever legal basis are requested from
and assumed by the Seller; the Seller does in particular
not assume any representations and warranties with
respect to any future earnings of the Companies and/or
their profitability.
9
Remedies for Breach of Warranties
9.1 If any of the representations and warranties stated in
Section 8 hereof should turn
out to be breached, in such event the Seller shall put
the Companies, or the Purchaser to the extent any of the
representations and warranties as stated in Section 8.1.1
are concerned, in a position as if the respective
representation and warranty had been correct and shall
compensate the Companies or the Purchaser to the extent
any of the representations and warranties as stated in
Section 8.1.1 are concerned, for the damage suffered by
the relevant breach, provided, however, that
(i) the Purchaser shall inform the Seller at the
latest within fourteen (14) days after members of
the management board or any senior executive
(Geschaftsfuhrer, Prokuristen sowie die Leiter des
Bereiches Finanzen, Controlling oder Recht) or any
of the persons named in Annex 9.1 to the Reference
Deed have become aware of facts or circumstances
which to the assessment of a prudent businessman
indicate a breach of a representation and warranty,
and
(ii)the Purchaser shall, first of all, give the
Seller the opportunity to remedy any breach of
representations and warranties within a reasonable
period of time of at least 45 days, and
(iii) the Purchaser shall use all reasonable
efforts to mitigate the damage suffered by him as a
result of the breach of a representation and
warranty, and
(iv)the Seller shall not be liable for any indirect
or consequential damages or damages for loss of
profits of the Purchaser and/or the Companies,
including any loss of contract, loss of use and the
like; any claims for such damages are hereby
expressly waived and excluded, provided, however,
that the aforesaid shall not apply to consequential
damages suffered by third parties and caused by
circumstances which constitute a breach of any
representation and warranty under this Agreement and
for which the respective third party has damage
claims against the Purchaser and/or the Companies
9.2 The Seller shall be given the unrestricted right and
opportunity to defend, at his own risk, discretion and
expense, any asserted claims or any action brought
against the Companies and/or the Purchaser which might
result in any liability of the Seller towards the
Purchaser in connection with this Agreement, including
the transactions contemplated hereunder. The Purchaser
shall give the Seller the right to inspect, at his own
expense, the books and records of the Companies during
ordinary business hours to the extent that such an
inspection might be necessary under the reasonable
discretion of the Seller for the defence of any claims
asserted or any action brought against the Comapanies
and/or the Purchaser which might result in any liability
of the Seller towards the Purchaser.
9.3 In case the Purchaser fails to comply with one of the
obligations under section 9.1 (i) hereto or fails to
comply with the obligations under Clauses 9.1 (ii) or 9.2
hereto within 14 days after Seller gives Purchaser
written notice of non-compliance all claims of the
Purchaser with respect to such asserted claims or actions
brought against the Companies and/or the Purchaser are
hereby expressly waived and excluded.
9.4 Any facts or circumstances mentioned or included in any
of the Annexes to this Agreement shall be deemed to be,
at the same time, a disclosure and Annex to any other
representation and warranty under this Agreement
excluding a liability of the Seller. The same shall apply
to those facts and circumstances which upon signing of
this Agreement are known otherwise by the representatives
of the Purchaser and/or the Parent named in Annex 9.1 to
the Reference Deed and/or by its advisers including all
members and associates of the law firm of Wessing &
Berenberg - Gossler and/or the auditing firm of
PriceWaterhouseCoopers to the extend such advisers have
disclosed their knowledge in writing to the aforesaid
representatives of the Purchaser and/or the Parent.
9.5 Insofar as specific representations and warranties are
given to individual aspects, circumstances or matters,
then any warranty claim can only be based on the specific
representation and warranty, but not on any general
warranty which may also cover this aspect.
9.6 To the extent the representations and warranties in
Section 8 hereof are based upon the knowledge or best
knowledge of the Seller, exclusively the knowledge of the
members of the Management Board of the Seller or the
persons listed in Annex 9.6 to the Reference Deed shall
be relevant.
9.7 Except for Clause 8.1.2 (6) the Purchaser shall not be
entitled to any claims based upon a breach of any
representation and warranty if and to the extent each
individual claim does not exceed an amount of DM 250,000.-
- and if, in addition, the aggregate amount of all claims
does not exceed DM 2.5 million; this shall not apply to
any claims under section 7 hereof. In case the aggregate
amount of DM 2.5 million is exceeded, the Purchaser can
only claim the exceeding amount. The total liability of
the Seller for all claims based upon a breach of any
representation and warranty under Section 8.1.1 (7),
8.1.7 (1) (b) and 8.1.7 (7) of this Agreement is limited
to the Purchase Price and all other claims under this
Agreement to 50 % of the Purchase Price as adjusted
pursuant to Section 6 hereof.
9.8 All claims for any breach of any representations and
warranties assumed by the Seller in this Agreement shall
become statute-barred (verjahren) on June 30, 2001,
except as otherwise agreed upon under this Agreement. The
aforesaid limitation period shall not apply to any claims
based on any breach of the representations and warranties
under (a) Section 8.1.1 (except subclause (7)) and
8.1.2.6 which shall become statute-barred within five (5)
years following the Closing Date and (b) Section 8.1.1
(7), 8.1.7 (5) (b), 8.1.7 (7) which claims shall become
statute barred thirty (30) years following the Closing
Date.
9.9 Any further explicit or implied representations or
warranties and/or remedies, irrespective of whatsoever
legal nature, amount or legal basis other than expressly
conceded heretofore, are expressly waived and excluded.
This applies, in particular without limitation, to any
claims and remedies under contractual and pre-contractual
fault (Positive Forderungsverletzung, culpa in
contrahendo), and especially without, however, limiting
the generality of the foregoing, to all rights and
remedies which should result in a cancellation of, or
rescission from, this Agreement or any other right or
remedy which would have a similar effect.
10
Warranties of Purchaser
10.1The Purchaser hereby warrants and represents to the
Seller by way of an independent guarantee in accordance
with 305 German Civil Code that the following statements
and declarations are true and correct as of the Closing
Date:
10.1.1 The Purchaser is a corporation duly and validly
existing and in good standing under the laws of the
Federal Republic of Germany and the Parent is a
corporation duly incorporated and validly existing and in
good standing under the laws of Delaware/USA.
10.1.2 The Purchaser and Parent have full corporate power
and authority to enter into this Agreement and to perform
their obligations hereunder. This Agreement constitutes a
valid and legally binding obligation of the Purchaser and
Parent enforceable in accordance with its terms and
conditions.
10.1.3 The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby will
not conflict with, or result in a breach, or constitute a
default or an acceleration under any provision of the
Articles of Incorporation or By-Laws of the Purchaser or
Parent, or any material contract, including any loan
agreement, or other obligation to which the Purchaser or
Parent is a party or by which the Purchaser or Parent are
bound.
10.1.4 Neither the execution of this Agreement nor the
consummation of the transactions contemplated hereby by
Purchaser or Parent will violate, or result in a breach
of, or constitute a default under, any judgment, decree,
order, rule, regulation, statute, or other restrictions
of any court, government, or governmental agency.
10.1.5 The Companies will not request repayment of the
dividends distributed to the Seller for the period from
January 1, 1999 through the Effective Date in accordance
with this Agreement.
10.2If any of the representations and warranties stated in
Section 10.1 hereof should turn out to be breached, in
such event the Purchaser shall put the Seller in a
position as if the respective representation and warranty
had been correct and shall compensate the Seller for the
damage suffered by the relevant breach.
10.3Any claims of the Seller under the aforesaid
representations and warranties shall become statute
barred five (5) years following the Effective Date except
the representations and warranties under Clause 10.1.5
which shall become statute barred six (6) years following
the Effective Date.
11
Guarantee of the Purchaser and the Parent
11.1The Purchaser hereby warrants and represents by way of an
independent guarantee in accordance with Section 305
German Civil Code to the Seller the complete and
unrestricted fulfillment of all and any obligations of
the Companies' vis a vis the Seller and the Seller's
affiliates out of and in connection with the Annexes E -
L to the Reference Deed.
11.2The Parent hereby warrants and represents by way of an
independent guarantee in accordance with Section 305
German Civil Code to the Seller the complete and
unrestricted fulfillment of all and any obligations (a)
of the Purchaser vis a vis the Seller and the
Sellers'affiliates out of or in connection with this
Agreement and (b) the Companies vis a vis the Seller and
the Sellers'affiliates out of or in connection with the
Annexes E - L to the Reference Deed.
11.3Any claims of the Seller under the aforesaid guarantees
(a) shall become statute barred at the same time the
respective claim of the Seller against the Purchaser
and/or the Companies becomes statute barred and (b) shall
not be any broader in scope than the underlying
obligation of the Purchaser and/or the Companies.
12
Reference to Arbiters
12.1In the event that the parties should not reach agreement
upon any balance sheet items, in particular without
limitation in connection with the Financial Statements
and/or the Closing Financial Statements and/or valuation
and assessment of any such items within twenty-one (21)
days following notice by the Purchaser respectively the
Seller, each party shall appoint one arbiter, whose
concurring decision shall be final and conclusive for the
parties. The Seller and the Purchaser may appoint each as
arbiters those accountants who assisted the parties
during the negotiations of this Agreement.
12.2The arbiters shall deliver a written opinion within
thirty (30) days after the appointment of the second
arbiter. If the arbiters cannot reach a decision, in
which both of them concur, within such period of time,
they shall each deliver a reasoned opinion in writing.
Within the scope and limits set by two opinions as
delivered, a third arbiter shall deliver a written
opinion, which opinion shall be final and conclusive upon
the parties. The third arbiter shall be appointed by the
parties jointly.
12.3If, upon the request of one party, the other party does
not appoint its own arbiter within a period of fourteen
(14) days, or does not agree upon the third arbiter
within a period of fourteen (14) days after receipt of
the opinions of the two arbiters, then the respective
arbiter shall be appointed upon the request of either
party by the President of the Chamber of Commerce in
Duesseldorf. The third arbiter shall not have been
employed by the parties or their affiliated companies.
Upon the request of either party, the third arbiter shall
be appointed from a major international accounting firm.
12.4The Seller and the Purchaser may present and submit their
case to the arbiters both in writing or orally. The
arbiters shall discuss and give reasons with respect to
the various issues from which they wish to deviate.
12.5Accounting and valuation standards and criteria, as
referred to in this Agreement, including any of the
Annexes attached to the Reference Deed, shall be binding
upon the arbiters. The arbiters shall act as experts
(Schiedsgutachter) and shall not decide upon legal
issues.
12.6All costs and expenses of the arbiters and the
proceedings hereunder shall be advanced and borne by the
parties, upon first request, in equal amounts. Each party
shall bear its own costs and the costs of its advisors
and counsel, except where their advisors act as arbiters
and except the arbiters decide otherwise.
12.7The arbiters may decide in their equitable discretion
upon the final allocation to the parties of their costs
and expenses as well as the costs and expenses of the
proceedings hereunder, including reasonable fees and
expenses of the parties and their advisors and counsel in
these proceedings, taking into account the decision and
the original positions and motions of the parties.
13
Right of Companies' Name
The Purchaser, the Companies and their successors and
assigns shall be entitled, but in no way obliged, to
operate under the present names of the Companies or any
variation thereof. Seller and its affiliates are
prohibited to use such names in the future.
14
Inter-Company and other Agreements
14.1Seller shall on or prior to the Effective Date terminate
any and all existing agreements including supply,
management, service, loan and lease agreements between
the Companies on the one side and the Seller and its
affiliated companies on the other side except those
agreements as disclosed in Annex 14.1 to the Reference
Deed.
14.2As of the Effective Date the supply of all Products of
the Companies shall be supplied by the Seller under the
Production and Supply Agreement negotiated with the
Purchaser and attached as Annex E to the Reference Deed.
14.3As of the Effective Date the Companies shall enter into a
Logistic Agreement with Schwarz Pharma AG as attached as
Annex F to the Reference Deed.
14.4As of the Effective Date, the performance of services to
be rendered by Schwarz Pharma AG and/or any affiliated
company of Schwarz Pharma AG and of services to be
rendered by ISIS PUREN GmbH & Co. KG shall be performed
under the Service Agreements negotiated with the
Purchaser and attached as Annex G1 and G2 to the
Reference Deed.
14.5As of the Effective Date the Companies shall enter into a
Lease Agreement about the premises in Monheim and Zwickau
as presently used by the Companies in accordance with the
Lease Agreement as attached as Annex H to the Reference
Deed.
14.6As of the Effective Date the Companies shall enter into a
Trademark Licence Agreement with Schwarz Pharma AG under
which Schwarz Pharma AG and/or any of its affiliates
shall be granted the exclusive right to use the trademark
"Obsidan" for the sale and marketing of its product
Ferroduo within the territory of Finland for a fixed term
of three years for a royalty equal to 2% of sales of
Ferroduo (ex Monheim) in accordance with the Trademark
Licence Agreement as attached as Annex J to the Reference
Deed.
14.7As of the Effective Date the Companies shall enter into a
Distribution Agreement with Schwarz Pharma AG under which
Schwarz Pharma AG and/or any of its affiliates shall be
granted the non-exclusive right to sell and market the
product Obsidan of the Companies within the territory of
Russia for a fixed term of three years for a royalty
equal to 2% of sales of Obsidan (ex Monheim) in
accordance with the Distribution Agreement as attached as
Annex K to the Reference Deed.
14.8In addition to the license agreement entered into on
November 2, 1998 between Seller and ISIS PUREN
Arzneimittel GmbH & Co. KG with respect to Omeprazol for
the territory of the Federal Republic of Germany, as of
the Effective Date Schwarz Pharma AG shall enter into a
Sublicence Agreement with the Companies under which
Schwarz Pharma AG will sublicense on a semi-exclusive
basis such rights for Omeprazol for the territories of
the present member states of the European Union,
excluding the territory of the Federal Republic of
Germany, Schwarz Pharma AG is entitled to under the
agreements Schwarz Pharma has entered into with Pharma
Pass/USA, including rights, if any, to future dossier
additions, in accordance with the Sublicence Agreement as
attached as Annex L to the Reference Deed.
15
Antitrust Clearing/Approvals
15.1The Purchaser has obtained a non-action letter and
positive clearance of the Federal Cartel Office
(Bundeskartellamt) attached to as Annex 15.1 to the
Reference Deed.
15.2Schwarz Pharma AG and the Purchaser will immediately
notify the Federal Cartel Office following the
consummation of the transaction by way of transfer of the
Shares of ISIS Pharma GmbH.
16
Costs
16.1Each party shall bear its own costs and expenses in
connection with the preparation, execution and
implementation of this Agreement, including any and all
professional fees of their advisers, as well costs and
expenses for granting and issuing the necessary power-of-
attorneys.
16.2All commissions, fees costs and expenses of Mr. Niggli in
connection with the transactions contemplated under this
Agreement shall be for the account of Seller. Seller
hereby indemnifies Purchaser and the Companies for any
obligations to Mr. Niggli (whether paid before or after
this date) in connection with the transactions
contemplated under this Agreement. Parent and Purchaser
guarantee that they have not entered into an Agreement
with Mr. Niggli triggering any commissions, fees, costs
and expenses of Mr. Niggli.
16.3 All notarial fees and registration costs as well as the
costs of the Federal Cartel Office (Gebuhren des
Bundeskartellamtes) in connection with the preparation
and implementation of this Agreement and the transactions
contemplated hereunder shall be borne by the Purchaser,
except as otherwise expressly agreed between the parties.
17
Assignment of Rights and Undertakings
17.1This Agreement and any rights and obligations hereunder
may not be assigned and transferred in whole or in part
without the prior written consent of the other party
hereto.
17.2The Purchaser may transfer or assign this Agreement or
any rights and obligations hereunder to any other
affiliated company or may perform any undertakings and
obligations hereunder by any such other affiliated
company. Costs and expenses including any taxes and
notarial fees resulting from any such assignment and
transfer shall be borne by the Purchaser. In case of any
transfer or assignment, the Purchaser shall guarantee the
performance of the obligation of the transferee or
assignee under this Agreement.
18
Confidentiality
18.1The Purchaser and Schwarz Pharma AG agree to keep
confidential and secret the contents of this Agreement
from third parties, except as they are obliged or advised
by legal counsel that it is in its best interest under
relevant securities or similar laws to disclose and to
give notice of the same to any court or administrative
authorities or otherwise. They will use their best
efforts even in such cases to ensure that,
notwithstanding any disclosure and notice to courts and
administrative authorities, confidentiality is maintained
to the maximum possible extent. Parties are permitted to
disclose the content to their advisors, as long as such
advisors are bound by professional secrecy.
18.2The Purchaser and Schwarz Pharma AG have mutually agreed
prior to Closing Date upon the language of individual
press releases and additional information to be released
to the press, customers and the business community
relating to the transactions contemplated by this
Agreement which is to be published after the Closing
Date. Each party may thereafter answer all reasonable
inquiries resulting from such press releases in the
manner (and containing such information) recommended by
its professional advisors, such answers, however, being
subject to the restrictions stipulated in 18.1 heretofor.
19
Non-Compete
Schwarz Pharma AG agrees that, for a period of four (4)
years after the Effective Date, neither it nor its
affiliates (abhaengige Unternehmen) in the meaning of
section 17 of the German Stock Corporation Act
(Aktiengesetz) will, directly or indirectly manufacture,
market or sell products which have identical active
substances as the Products presently being marketed or
sold by the Companies as of the Effective Date; provided
that this restriction does not apply to those products,
which differ in dosage, form and/or formulation, are used
in new indications or which reduce side effects or
improve compliance, or to any products being marketed or
sold by Schwarz Pharma AG or its affiliates as of the
Effective Date and provided, furthermore, that this
restriction does not apply to the manufacture of products
of any kind for third parties. It is further being
understood that the aforesaid does not prevent Schwarz
Pharma AG directly or indirectly to acquire or merge with
pharmaceutical businesses (and to maintain any such
acquired or merged businesses) which also manufacture,
market or sell products being subject to the aforesaid
restrictions except where such businesses are known in
the market as mere generic businesses.
20
Insurance
20.1Schwarz Pharma shall take all action necessary so that,
the insurance for clinical trials (test persons) of
Schwarz Pharma will cover all trials commenced prior to
the Closing Date and Schwarz Pharma shall assist the
Companies in making any claims appropriate under these
and any other insurance policies entered into by Schwarz
Pharma in favour of the Companies, and which offered
coverage for the Companies at any time prior to the
Effective Date.
20.2Subject to the limitations of Clause 9.7 hereof, Schwarz
Pharma shall indemnify the Companies for any increases in
premium with respect to the Companies' policy under the
German Pharmaceutical Act (Arzneimittelgesetz) reinsured
into the Pharmaceutical Reinsurance Pool (Pharma-
Ruckversicherungs-Gemeinschaft) to the extent such
increase is directly related to claims with respect to
products manufactured prior to the Closing Date.
21
Notices
21.1Notices in connection with this Agreement shall be
addressed to the following
addresses:
21.1.1 The Seller
Schwarz Pharma Aktiengesellschaft
Vorstand
Alfred-Nobel-Strabe 10
D-40789 Monheim
Federal Republic of Germany
21.1.2 The Purchaser
Alpharma International Pharmaceutical Division
Habitizalleen 3
N-0275 Oslo
Norway
Attention: President
With a copy to:
Alpharma Inc.
One Executive Drive
Ft. Lee, New Jersey 07924
United States
Attention: Vice President and Chief Legal
Officer
21.2The aforesaid addresses shall remain valid and in force
unless and until the other party has been notified in
writing by registered mail of any other address.
21.3All notices in connection with this Agreement must be in
writing and shall become effective upon receipt. Notices
by telefax, telegram or telex must be confirmed in
writing.
22
Arbitration
22.1Any and all disputes, controversies and claims arising
out of or in connection with this Agreement and its
performance shall not be decided by the ordinary courts,
but by arbitration in accordance with the Arbitration
Agreement attached as Annex M to the Reference Deed.
22.2The Board of Arbitration shall also decide on the
validity, the legality and interpretation of the
Arbitration Agreement.
23
Miscellaneous
23.1The Parties shall with respect to the termination of the
employment relationship with a certain employee of the
Companies assume certain obligations as specified in more
detail in Annex 23.1 to the Reference Deed.
23.2This Agreement is subject to the laws of the Federal
Republic of Germany.
23.3Jurisdiction for any disputes, controversies and claims
arising out of or in connection with this Agreement and
its performance shall be with the competent courts of
Duesseldorf, except as otherwise agreed to in the
Arbitration Agreement.
23.4All amendments to this Agreement, including without
limitation a change of this clause itself, must be made
in writing and with the express reference to this
Agreement, unless notarization or any other form is
required.
23.5All Annexes shall be an integral part of this Agreement.
23.6This Agreement is written in the English language (except
that Annexes may be in the German language). Terms to
which a German translation has been added shall be
interpreted throughout this Agreement in the meaning
assigned to them by the German translation.
Notwithstanding the generality of the aforesaid all terms
expressed in the English language shall have the meaning
assigned to them by German law.
23.7This Agreement including the Annexes hereto contains all
terms, conditions, representations and warranties agreed
upon between the parties relating to the subject matter
of this Agreement and supersedes all prior negotiations,
agreements and undertaking of the parties, oral, written,
with respect to the subject matter hereof. Oral side
agreements to this Agreement do not exist.
23.8Each party shall from time to time execute and deliver
all such additional documents and take all such
additional actions as the other party may reasonably
require in order to effectively consummate this Agreement
as provided herein.
23.9At the full risk, cost and expense of Purchaser, Seller
agrees to cooperate with Purchaser, and facilitate
Deloitte & Touche, Seller's independent public
accountants, to provide to Purchaser audited consolidated
financial statements of the Companies for the 1997 and
1998 fiscal years prepared in conformity with US
generally accepted accounting practices and such other
requirements applicable to filings required of Parent
under the rules and regulations of the US Securities and
Exchange Commission.
23.10 If any of the provisions of this Agreement shall
become or be held invalid, ineffective or unenforceable,
all other provisions hereof shall remain in full force
and effect. The invalid, ineffective or unenforceable
provision shall be deemed to be automatically amended and
replaced without the necessity of further action by the
parties hereto by such form, substance, time, measure and
jurisdiction as shall be valid, effective and enforceable
and as shall accomplish as far as possible the purpose
and intent of the invalid, ineffective or unenforceable
provision. The aforesaid shall apply mutatis mutandis for
any situation not contemplated and covered by this
Agreement.