4
AGREEMENT AND BILL OF SALE
Agreement and Bill of Sale dated September 30, 1997 by and between
Bio-Reference Laboratories, Inc., a New Jersey corporation ("BRLI") and IMPATH
Inc., a Delaware corporation (the "Purchaser").
W I T N E S S E T H:
WHEREAS, BRLI operates a clinical laboratory in Elmwood Park, New Jersey
where it performs a comprehensive list of diagnostic tests including pathology
and oncology clinical laboratory testing;
WHEREAS, the bulk of such pathology and oncology clinical laboratory
testing is conducted through BRLI's GenCare Division* (although BRLI also
conducts certain of such tests separately from the said Division);
WHEREAS, the Purchaser desires to acquire from BRLI those assets
specifically enumerated in Schedule I attached hereto (the "Assets"); to assume
those liabilities and contractual obligations specifically enumerated in
Schedule II attached hereto (the "Assumed Liabilities"); and to obtain BRLI's
agreement not to perform those diagnostic tests specifically enumerated in
Schedule III attached hereto (the "Restricted Tests") for the customers therein
set forth (the "Restricted Customers") during the restricted periods therein set
forth (the "Restricted Periods"); and BRLI desires to transfer the Assets and to
assign the Assumed Liabilities to the Purchaser, and is willing to agree not to
perform the Restricted Tests for the Restricted Customers during the Restricted
Periods; on the terms and subject to the conditions hereinafter set forth; and
WHEREAS, to induce the Purchaser to enter into this Agreement and Bill of
Sale and perform its obligations hereunder, BRLI and certain officers of BRLI
are concurrently herewith entering into non-competition agreements with the
Purchaser.
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements hereinafter set forth, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged, the
parties hereto, intending to be legally bound, hereby agree as follows:
1. Assets. The Assets shall consist of and shall be limited solely to
those assets of BRLI specifically listed on Schedule I attached hereto.
2. Assumed Liabilities. The Assumed Liabilities shall consist of and shall
be limited solely to the obligations and liabilities of BRLI listed on Schedule
II attached hereto. The Purchaser shall not assume, and shall have no
responsibility with
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*For purposes of this Agreement, "BRLI" shall also include the GenCare
Division ("GenCare") and any majority-owned subsidiary or affiliated entity of
BRLI in which BRLI has a 50% or greater ownership interest in the assets, income
or equity, or any subsidiary or affiliated entity which BRLI has by ownership of
voting power, agreement or otherwise, the power to control.
respect to, any liabilities or obligations of BRLI, except for the
Assumed Liabilities.
3. Purchase Price. The purchase price for the Assets is $6,000,000,
subject to adjustment as provided in this Section 3 (the "Purchase Price"). The
Purchase Price shall be paid as follows:
(i) $4,600,000 payable by wire transfer on the date hereof to the account
of BRLI pursuant to the wire instructions set forth in Schedule IV attached
hereto; and
(ii) $1,400,000 payable in four (4) equal installments of $350,000 each on
April 1, 1998, October 1, 1998, April 1, 1999 and October 1, 1999; provided
however, that the aggregate amount payable under this clause (ii) will be
decreased (but not by more than an aggregate $700,000) if Revenue (as
hereinafter defined) for the first six (6) months after October 12, 1997 (the
"Measuring Period") is less than Target Revenue (as hereinafter defined), such
decrease (x) to be calculated as sixty percent (60%) of the difference between
Revenue for such six (6) month period and Target Revenue and (y) to be applied
by dividing such decrease into two (2) equal halves and applying one such half
in reduction of the installment payable on April 1, 1999 and the other half in
reduction of the installment payable on October 1, 1999. Each installment to be
paid by the Purchaser under this clause (ii) (decreased to the extent required
above as if so decreased as of the date of this Agreement), shall bear interest
at the rate of nine percent (9%) per annum from the date hereof to the date of
payment.
(iii) For purposes of this Section 3, "Revenue" shall mean an aggregate
amount equal to the Purchaser's current listed fees for each of the Restricted
Tests it performs during the Measuring Period for any Restricted Customer,
reduced by 26.6% (the "Reduction Percentage") of such amount in lieu of any
adjustment for contractual allowances, credits or non-payments. In order to
maximize the retention of Restricted Customers during the Measuring Period, the
Purchaser agrees that the fees it charges to Restricted Customers during the
Measuring Period shall include special prices for special customers (based on
volume) similar to those charged by GenCare in such circumstances during the
three (3) calendar month period ended June 30, 1997. In no event shall the
Purchaser's fees for Restricted Tests performed for Restricted Customers during
the Measuring Period be less than the fees charged by GenCare for comparable
tests performed by it for Restricted Customers during the three (3) calendar
month period ended June 30, 1997 (including special prices for special customers
based on volume). The Purchaser agrees during the Measuring Period, to promptly
perform all of the Restricted Tests requested by each of the Restricted
Customers, provided however that the Purchaser may elect to terminate the
servicing of a Restricted Customer, in whole or in part, during the Measuring
Period. In such event, "Revenue" shall include the greater of (a) all amounts
equal to the Purchaser's current listed fees for the Restricted Tests it
performs during the Measuring Period for any such Restricted Customer which it
elects not to service in whole or in part during such period, or (b) any amounts
billed by GenCare to such Restricted Customer for Restricted Tests performed by
it during the three (3) calendar month period ended June 30, 1997, in each case,
reduced by the Reduction Percentage. If such Restricted Customer is a "Common
Customer" as defined in clause (iv) hereunder, "Revenue" shall include the
greater of (a) all amounts equal to the Purchaser's
current listed fees for the Restricted Tests it performs during the Measuring
Period for any such Common Customer which it elects not to service in whole or
in part during such period, or (b) the sum of any amounts billed by GenCare and
by the Purchaser to such Common Customer for Restricted Tests performed by them
during the three (3) calendar month period ended June 30, 1997, in each case,
reduced by the Reduction Percentage.
(iv) For purposes of this Section 3, "Target Revenue" shall mean
ninety-five percent (95%) of an amount ("Base Target Amount") which is two (2)
times the aggregate amounts billed by GenCare to any Restricted Customer for any
Restricted Test performed by it during the three (3) calendar month period ended
June 30, 1997, reduced by the Reduction Percentage. The aggregate amounts billed
by GenCare to all Restricted Customers for Restricted Tests performed by GenCare
during the three (3) calendar month period ended June 30, 1997 totalled
$1,028,671 prior to any reduction through application of the Reduction
Percentage. The parties acknowledge that during the three (3) calendar month
period ended June 30, 1997, they each rendered diagnostic clinical laboratory
testing services for certain of the same Restricted Customers ("Common
Customers"). At the closing of the sale contemplated hereby, BRLI shall deliver
a list to the Purchaser setting forth the name of each such Restricted Customer
to whom such services were billed in the normal course of business by GenCare
during such three (3) month period and the amount of such billings to each such
customer. The Purchaser agrees to deliver a list to BRLI within five (5)
business days thereafter, setting forth the name of each Common Customer whom
the Purchaser billed for such services in the normal course of business during
such three (3) calendar month period, and the amount of such billings to each
such customer. For purposes of this Section 3, "Target Revenue" shall also
include ninety-five percent (95%) of two (2) times the Base Target Amount billed
by GenCare and the Purchaser in the ordinary course of business to Common
Customers, reduced by the Reduction Percentage, during the three (3) calendar
month period ended June 30, 1997 for diagnostic clinical laboratory services
(not limited to "Restricted Tests") to the extent not included pursuant to the
first sentence of this clause (iv) of Section 3 of this Agreement and Bill of
Sale. Excluded from the Base Target Amount shall be billings of the Purchaser
during the three (3) calendar month period ended June 30, 1997 to a Common
Customer who was not billed by the Purchaser at any time during the month of
August or subsequent thereto through the date hereof, for diagnostic clinical
laboratory services rendered at any time during such period by the Purchaser.
Also excluded from Base Target Amount are any billings of BRLI (as opposed to
GenCare) for diagnostic clinical laboratory services rendered by it during such
three (3) month period to Common Customers. In conjunction with the delivery of
the above described list, the Purchaser shall also deliver a written
representation letter to BRLI, duly executed by its chief operating officer,
that it has no knowledge of any impending or contemplated discontinuance of
demand for services by any of the Common Customers, other than those Common
Customers specified in such representation letter. Also excluded from Base
Target Amount shall be billings of the Purchaser during the three (3) calendar
month period ended June 30, 1997 for diagnostic clinical laboratory services
rendered to any such specified Common Customer.
(v) Within ninety (90) days after completion of the Measuring Period, the
Purchaser shall deliver a written representation letter to BRLI, duly executed
by its chief financial officer (the "Purchaser Certification"), certifying by
individual name, each
Restricted Customer (including Common Customer) serviced by the Purchaser during
the Measuring Period, the nature of each Restricted Test performed by the
Purchaser for such Restricted Customer (including Common Customer) during the
Measuring Period and, with respect to each such Restricted Customer (including
Common Customers) the amount of "Revenue" attributable thereto computed in
accordance with clause (iii) of this Section 3, prior to application of the
Reduction Percentage. During the ninety (90) day period commencing on the date
of its receipt of the Purchaser Certification, BRLI and its authorized
representatives shall have the right during normal business hours, at any time
and from time to time, upon written request made at least two (2) business days
prior thereto, to inspect, review and receive copies of the books and records of
the Purchaser which relate to the Common Customers and the revenues attributable
to the Common Customers from April 1, 1997 until conclusion of the Measuring
Period, to the Restricted Tests performed by the Purchaser for Restricted
Customers (including Common Customers) during the Measuring Period, and to the
installment payments owing to BRLI pursuant to this Agreement. The Purchaser
agrees to maintain such books and records at its principal place of business in
New York City.
(vi) In the event Purchaser fails to make any payment when due hereunder,
interest shall accrue on such overdue payment at a rate of one (1%) percent per
month commencing on the date the payment became overdue. Upon the failure by
Purchaser to timely remit any installment payment or portion thereof due to BRLI
hereunder and upon Purchaser's failure to cure said default in payment within
twenty (20) business days after actual receipt of written notice of same from
BRLI, the due date of all of the outstanding and unpaid installments referred to
in clause (ii) shall be accelerated and shall become immediately due and payable
together with accrued interest thereon, and BRLI shall be entitled to pursue any
and all legal remedies including but not limited to commencing legal action to
collect said payments without further notice to Purchaser or Purchaser's
Attorneys. In the event legal action is necessary as a result of Purchaser's
default in payment hereunder, the Purchaser shall be responsible for BRLI's
legal fees, costs and disbursements as a result thereof provided that if it is
determined in said legal action that the Purchaser is not in default hereunder,
BRLI shall be responsible for its own and for the Purchaser's legal fees, costs
and disbursements in connection therewith.
(vii) Nothing contained in this Agreement or in the transactions
contemplated hereby shall prevent BRLI from performing clinical laboratory tests
of every nature and description for Restricted Customers or any other customers
at any time after the date hereof, except for Restricted Tests performed for
Restricted Customers during the applicable Restricted Period.
4. Sale of Assets. BRLI hereby sells, assigns and conveys to the
Purchaser, and the Purchaser hereby purchases, acquires and accepts from BRLI,
all right, title and interest of BRLI in and to the Assets. BRLI shall be
responsible for any taxes arising from such sale of the Assets. Not included in
the sale are BRLI's receivables including receivables for Restricted Tests
performed by BRLI prior to the date hereof and amounts billed by BRLI for
Restricted Tests performed by it after the date hereof on patient samples
received by BRLI prior to the date hereof.
5. Assumption of Liabilities. BRLI hereby assigns to the Purchaser, and
the Purchaser hereby assumes and accepts from BRLI, the Assumed Liabilities. The
Purchaser shall not assume and shall
have no responsibility with respect to any liabilities or obligations of BRLI,
other than the Assumed Liabilities.
6. Allocation. The Purchase Price for the Assets (including the amount of
the Assumed Liabilities) shall be allocated as set forth on Schedule V attached
hereto. The parties hereto agree that the allocation of the Purchase Price is
intended to comply with the allocation method required by Section 1060 of the
Internal Revenue Code of 1986, as amended (the "Code"). The parties shall
cooperate to comply with all substantive and procedural requirements of Section
1060 of the Code and any regulations thereunder, and the allocation shall be
adjusted if, and to the extent, necessary to comply with the requirements of
Section 1060 of the Code. Neither BRLI nor the Purchaser will take, nor permit
any affiliated person to take, for federal, state or local income tax purposes,
any position inconsistent with the allocation set forth on Schedule V attached
hereto, or, if applicable, such adjusted allocation. Each of BRLI and the
Purchaser hereby agrees that it shall attach to its tax returns for 1997 an
information statement on Form 8594, which shall be completed in accordance with
the allocation set forth on Schedule V attached hereto.
7. Representations and Warranties of BRLI. BRLI hereby represents and
warrants to, and covenants and agrees with the Purchaser, its successors and
assigns, as of the date hereof, that:
(i) BRLI is duly organized, validly existing and in good standing under
the laws of the State of New Jersey and has full corporate power and authority
to own its properties and to conduct the businesses in which it is now engaged.
The execution and delivery of this Agreement and Bill of Sale by BRLI, the
performance by BRLI of its covenants and agreements hereunder and the
consummation by BRLI of the transactions contemplated hereby have been duly
authorized by all necessary corporate action. This Agreement and Bill of Sale
constitutes the valid and legally binding obligation of BRLI, enforceable
against BRLI in accordance with its terms.
(ii) Neither the execution and delivery of this Agreement and Bill of
Sale, nor the consummation of the transactions contemplated hereby, violates any
provision of the certificate of incorporation or by-laws of BRLI or, to the best
of BRLI's knowledge, of any statute, ordinance, regulation, order, judgment or
decree of any court or governmental agency or board, or conflicts with or will
result in any breach of any of the terms of or constitute a default under or
result in the creation of any lien pursuant to the terms of any contract or
agreement to which BRLI is a party or by which BRLI or any of the Assets is
bound. To the best of BRLI's knowledge and except as set forth on Schedule VI
attached hereto, no consents, approvals or authorizations of, or filings with,
any governmental authority or any other person or entity are required in
connection with the execution and delivery of this Agreement and Bill of Sale
and the consummation by it of the transactions contemplated hereby.
(iii) Except as set forth on Schedule VII attached hereto, BRLI has good
and valid title to the Assets, free and clear of all liens, charges,
encumbrances or security interests whatsoever, and BRLI has full power and
authority to sell the Assets and to assign the Assumed Liabilities to the
Purchaser and to execute in connection therewith this Agreement and Bill of
Sale. Upon execution and delivery of this Agreement and Bill of Sale, except as
set forth on Schedule VII attached hereto, the Purchaser shall
have good and valid title to the Assets, free and clear of all liens, charges,
encumbrances or security interests whatsoever.
(iv) There are no claims, disputes, actions, suits, proceedings or
investigations pending, or, to the best of BRLI's knowledge, threatened, against
or affecting the Assets, at law or in equity, or before any Federal, state,
municipal or other governmental department, commission, board, bureau, agency or
instrumentality, domestic or foreign, or any arbitration panel, nor are there
any claims, disputes, actions, suits or proceedings pending, or to the best of
BRLI's knowledge, threatened against BRLI, by any Restricted Customer.
(v) Each individual employed by or contracted with by BRLI in connection
with the Restricted Tests to provide professional services is duly licensed to
provide such services and, to the best of BRLI's knowledge, is otherwise in
compliance with all Federal, state and local laws, rules and regulations
relating to such professional licensure and otherwise meets the qualifications
to provide such professional services. To the best of its knowledge, BRLI in
connection with conducting of the Restricted Tests, is in compliance with all
relevant state laws and precedents relating to the corporate practice of the
learned or licensed professions, and there are no material claims, disputes,
actions, suits, proceedings or investigations currently pending, or to the best
of BRLI's knowledge, threatened or filed or commenced against or affecting
BRLI's conduct of the Restricted Tests or the Assets, and no such material
claim, dispute, action, suit, proceeding or investigation has been filed or
commenced during the five year period preceding the date of this Agreement and
Bill of Sale, and BRLI is not aware of any basis for a valid claim of such
nature.
(vi) To the best of BRLI's knowledge, it is not in default under any, and
has complied with all material statutes, ordinances, regulations, orders,
judgments and decrees of any court or governmental entity or agency, relating to
its conduct of the Restricted Tests or the Assets. BRLI has no knowledge of any
basis for assertion of any material violation of the foregoing or for any claim
for compensation or damages or otherwise arising out of any violation of the
foregoing. BRLI has not received any notification of any asserted present or
past failure to comply with any of the foregoing which has not been
satisfactorily responded to in the time period required thereunder.
(vii) BRLI has delivered to the Purchaser, copies of all licenses,
certificates, permits, approvals, franchises, notices and authorizations issued
by governmental entities or other regulatory authorities, federal, state or
local (collectively, the "Permits"), held by BRLI for the conduct of the
Restricted Tests. Such Permits are, to the best of BRLI's knowledge, all the
Permits required for the conduct of the Restricted Tests. All the Permits are in
full force and effect, and to the best of its knowledge, BRLI has not engaged in
any activity which would cause or permit revocation or suspension of any such
Permit, and BRLI has no knowledge that any action or proceeding looking to or
contemplating the revocation or suspension of any such Permit is pending or
threatened. To the best of BRLI's knowledge, there are no existing defaults or
events of default or events or state of facts which with notice or lapse of time
or both would constitute a default by BRLI under any such Permit. BRLI has no
knowledge of any default or claimed or purported or alleged default or state of
facts which with notice or lapse of time or both would constitute a default on
the part of any party in the performance of any obligation to be performed or
paid
by any party under any Permit. To the best of BRLI's knowledge, the consummation
of the transactions contemplated hereby will in no way affect the continuation,
validity or effectiveness of the Permits or require the consent of any person
not already obtained. Nothing herein contained shall require BRLI to maintain
any Permit after the sale of the Assets hereunder.
(viii) BRLI is not a party to any agreement related to the Restricted
Tests which, to the best of its knowledge, involves any activity that
constitutes illegal self-referrals or fraud or abuse under any Federal or state
self-referral prohibition or anti- kickback prohibition.
(ix) There are no claims, disputes, actions, suits, proceedings or
investigations pending, or, to the best of BRLI's knowledge, threatened against
BRLI alleging any violations by it of the laws, rules and regulations of the
Medicare, Medicaid or Champus healthcare programs.
(x) The aggregate amounts billed by GenCare to all Restricted Customers
for Restricted Tests performed by GenCare during the three (3) calendar month
period ended June 30, 1997 totalled $1,028,671 prior to any reduction through
application of the Reduction Percentage.
(xi) BRLI has no knowledge of any impending or contemplated reduction by
the Restricted Customers in the number or dollar volume of Restricted Tests to
be ordered after the date hereof which would result in a material reduction in
the aggregate number of Restricted Tests ordered or in the aggregate amounts
billed with respect thereto as compared to the average levels of such number of
tests ordered from GenCare and aggregate amounts billed with respect thereto
over the three (3) calendar month period ended June 30, 1997 except that whereas
GenCare's net billings to St. Joseph's Hospital during the three (3) calendar
month period ended June 30, 1997 aggregated $35,000 per month, GenCare's current
contract with St. Joseph's Hospital provides for minimum monthly billings of
$28,750.
(xii) Neither BRLI nor GenCare currently has any exclusive capitated
managed care contract in effect with any Restricted Customer which would
prohibit the Purchaser from being paid for services by such customer, the fees
contemplated by Section 3(iii) of this Agreement.
(xiii) No representation or warranty made by BRLI in this Agreement and
Bill of Sale, and no document delivered prior to or at the Closing or executed
simultaneously herewith in connection with the transactions contemplated hereby
(collectively the "Closing Documents") is, and no document delivered subsequent
thereto as contemplated herein will be, false or inaccurate in any material
respect, and no statement of fact made by BRLI herein or therein contains, or
will contain any untrue statement of material fact or omits, or will omit to
state any fact of which BRLI is aware that is necessary in order to make the
statement not misleading in any material respect. All Schedules to this
Agreement are integral parts of this Agreement.
8. Representations and Warranties of Purchaser. The Purchaser hereby
represents and warrants to, and covenants and agrees with BRLI, its successors
and assigns, as of the date hereof, that:
(i) Purchaser is duly organized, validly existing and in good standing
under the laws of the State of Delaware and has full corporate power and
authority to own its properties, to conduct the businesses in which it is now
engaged and to conduct the Restricted Tests. The execution and delivery of this
Agreement and Bill of Sale by Purchaser, the performance by Purchaser of its
covenants and agreements hereunder and the consummation by Purchaser of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action. This Agreement and Bill of Sale constitutes the valid and
legally binding obligation of Purchaser, enforceable against Purchaser in
accordance with its terms.
(ii) Neither the execution and delivery of this Agreement and Bill of
Sale, nor the consummation of the transactions contemplated hereby, violates any
provision of the certificate of incorporation or by-laws of Purchaser or, to the
best of Purchaser's knowledge, of any statute, ordinance, regulation, order,
judgment or decree of any court or governmental agency or board, or conflicts
with or will result in any breach of any of the terms of or constitute a default
under or result in the creation of any lien pursuant to the terms of any
contract or agreement to which Purchaser is a party or by which Purchaser or any
of the Assets is bound. To the best of Purchaser's knowledge, no consents,
approvals or authorizations of, or filings with, any governmental authority or
any other person or entity are required in connection with the execution and
delivery by Purchaser of this Agreement and Bill of Sale and the consummation by
it of the transactions contemplated hereby.
(iii) The Purchaser has delivered to BRLI, copies of all licenses,
certificates, permits, approvals, franchises, notices and authorizations issued
by governmental entities or other regulatory authorities, federal, state or
local (collectively, the "Purchaser Permits"), held by Purchaser for the conduct
of the Restricted Tests. Such Purchaser Permits are, to the best of Purchaser's
knowledge, all the Purchaser Permits required by it for the conduct of the
Restricted Tests except for CD4 and Serum Tumor Marker testing. All the
Purchaser Permits are in full force and effect, and to the best of its
knowledge, Purchaser has not engaged in any activity which would cause or permit
revocation or suspension of any such Purchaser Permit, and Purchaser has no
knowledge that any action or proceeding looking to or contemplating the
revocation or suspension of any such Purchaser Permit is pending or threatened.
To the best of Purchaser's knowledge, there are no existing defaults or events
of default or events or state of facts which with notice or lapse of time or
both would constitute a default by Purchaser under any such Purchaser Permit.
Purchaser has no knowledge of any default or claimed or purported or alleged
default or state of facts which with notice or lapse of time or both would
constitute a default on the part of any party in the performance of any
obligation to be performed or paid by any party under any Purchaser Permit. To
the best of Purchaser's knowledge, the consummation of the transactions
contemplated hereby will in no way affect the continuation, validity or
effectiveness of the Purchaser Permits or require the consent of any person not
already obtained.
(iv) Each individual to be employed by or contracted with by Purchaser in
connection with the Restricted Tests to provide professional services is duly
licensed to provide such services and, to the best of Purchaser's knowledge, is
otherwise in compliance with all Federal, state and local laws, rules and
regulations relating to such professional licensure and otherwise meets the
qualifications to provide such professional services. To
the best of its knowledge, Purchaser in connection with conducting of the
Restricted Tests, will be in compliance with all relevant state laws and
precedents relating to the corporate practice of the learned or licensed
professions, and there are no material claims, disputes, actions, suits,
proceedings or investigations currently pending, or to the best of Purchaser's
knowledge, threatened or filed or commenced against or affecting Purchaser's
ability to perform the Restricted Tests, and no such material claim, dispute,
action, suit, proceeding or investigation has been filed or commenced during the
five year period preceding the date of this Agreement and Bill of Sale, and
Purchaser is not aware of any basis for a valid claim of such nature.
(v) Attached hereto as Schedule VIII is a true and complete copy of
Purchaser's audited financial statements for its most recently completed fiscal
year ended December 31, 1996. Such financial statements have been prepared in
accordance with GAAP and are true and correct at the date and for the annual
period then ended. Since December 31, 1996, there has been no material adverse
change in Purchaser's financial condition or in its operating results.
(vi) No representation or warranty made by Purchaser in this Agreement and
Bill of Sale or in any document delivered prior to or at the Closing or executed
simultaneously herewith in connection with the transactions contemplated hereby
(collectively the "Closing Documents") is, and no document delivered subsequent
thereto as contemplated herein will be false or inaccurate in any material
respect, and no statement of fact made by Purchaser herein or therein contains,
or will contain any untrue statement of material fact or omits, or will omit to
state any fact of which Purchaser is aware that is necessary in order to make
the statement not misleading in any material respect. All Schedules to this
Agreement are integral parts of this Agreement.
9. Non-Competition. BRLI and certain of its officers have entered into
Non-Competition Agreements with the Purchaser simultaneously with the execution
of this Agreement and Bill of Sale.
10. Indemnification. BRLI hereby agrees to indemnify the Purchaser from
and against all losses, claims, assessments, demands, damages, liabilities,
obligations, costs and/or expenses, including, without limitation, reasonable
fees and disbursements of counsel (including fees and disbursements of counsel
incurred in connection with any claim or action between BRLI and the Purchaser)
(hereinafter referred to collectively as "Damages"), sustained or incurred by
the Purchaser (i) by reason of the breach of any of the obligations, covenants
or provisions of, or the inaccuracy of any of the representations or warranties
made by BRLI herein, (ii) arising out of liabilities or obligations of BRLI
which are not Assumed Liabilities, or (iii) based upon violations by BRLI and/or
GenCare of any laws, rules or regulations of the Medicare, Medicaid or Champus
healthcare programs prior to the date hereof. The Purchaser hereby agrees to
indemnify and hold harmless BRLI from and against any Damages sustained or
incurred by BRLI arising out of the Assumed Liabilities or by reason of the
breach of any of the obligations, covenants and provisions of, or the inaccuracy
of any of the representations or warranties made by Purchaser herein.
11. Further Assurances and Covenants.
(i) BRLI hereby further covenants and agrees to execute and deliver such
other and further instruments and documents as the Purchaser may reasonably
request to carry into effect or to evidence further the sale of the Assets and
assignment of the Assumed Liabilities to the Purchaser. In addition, BRLI agrees
to provide the Purchaser with copies of all GenCare patient reports pertaining
to Restricted Tests performed for patients of the Restricted Customers, as may
be reasonably required by the Purchaser, subject to any legal requirements that
BRLI maintain the originals of such reports.
(ii) The Purchaser hereby further covenants and agrees to execute and
deliver such other and further instruments and documents as BRLI may reasonably
request to carry into effect or to evidence further the assumption by the
Purchaser of the Assumed Liabilities.
12. Successors and Assigns. This Agreement and Bill of Sale shall be
binding upon and inure to the benefit of the successors and assigns of the
Purchaser and BRLI, respectively.
13. Assignment. Neither party may assign this Agreement without the
other's prior written consent, except that the Purchaser may assign all of its
rights and obligations hereunder to a wholly-owned subsidiary of the Purchaser,
without BRLI's consent provided that at the time of such assignment the
Purchaser delivers to BRLI, a reasonably satisfactory written assumption by said
wholly-owned subsidiary of all of the Purchaser's payment and performance
obligations to BRLI hereunder, together with a reasonably satisfactory written
guarantee by the Purchaser to BRLI, of the subsidiary's payment and performance
obligations to BRLI hereunder. This Agreement shall be binding on and shall
inure to the benefit of the parties to this Agreement, and their successors and
permitted assigns. Subject to the foregoing sentence, no person or entity not a
party to this Agreement shall have any right under or by virtue of this
Agreement.
14. Survival. Each representation, warranty, covenant and agreement of the
parties hereto herein contained shall survive closing and for a period of two
and one-half (2 1/2) years thereafter, notwithstanding any investigation at any
time made by or on behalf of any party hereto.
15. Notices. All notices, requests or instructions hereunder shall be in
writing and delivered personally, sent by telecopy or sent by registered or
certified mail, postage prepaid, as follows:
(1) If to BRLI:
Bio-Reference Laboratories, Inc.
481 B Edward H. Ross Drive
Elmwood Park, New Jersey 07407
Attention: Howard Dubinett
Executive Vice President
Telecopy No.: (201) 791-1491
(2) If to the Purchaser:
IMPATH Inc.
1010 Third Avenue, Suite 203
New York, New York 10021
Attention: Mr. John P. Gandolfo
Executive Vice President
Telecopy No.: (212) 759-4869
Any of the above addresses may be changed at any time by notice given as
provided above; provided, however, that any such notice of change of address
shall be effective only upon receipt. All notices, requests or instructions
given in accordance herewith shall be deemed received on the date of delivery,
if hand delivered or telecopied, and two business days after the date of
mailing, if mailed.
16. Effective Date. The effective date of this Agreement and Bill of Sale
shall be the date first set forth above.
17. Expenses. Each of the parties hereto shall bear such party's own
expenses in connection with this Agreement and Bill of Sale and the transactions
contemplated hereby
18. Governing Law. This Agreement and Bill of Sale shall be governed by
and construed in accordance with the laws of the State of New York applicable in
the case of agreements made and to be performed entirely within such State.
19. Amendment. This Agreement and Bill of Sale may not be
amended or modified except in a writing executed by each of the
parties hereto.
20. Arbitration. The parties hereby agree to submit any dispute concerning
the provisions of this Agreement and Bill of Sale and the transactions
contemplated hereby to resolution by arbitration under the rules of the American
Arbitration Association. The parties hereto consent to the jurisdiction of the
American Arbitration Association in New York City with regard to any such
disputes and hereby agree that the arbitrators shall be empowered to award money
damages as well as to impose injunctive relief with respect thereto.
21. Brokerage. Each party agrees to indemnify and hold the other free and
harmless from all losses, damages, costs and expenses (including attorney's
fees) that may be suffered as a result of claims brought by any broker or finder
seeking compensation on account of this transaction arising out of the actions
of such party.
22. Counterparts. This Agreement and Bill of Sale may be executed in
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.
23. Confidentiality. Each party hereto agrees that it will not disclose
the terms of this Agreement and Bill of Sale, the Transition Agreement or the
Non-Compete Agreement, each dated as of this date, between the parties, except
in compliance with said Non- Compete Agreement. Furthermore, each party agrees
to submit any proposed press release concerning the terms of this Agreement and
Bill of Sale and the transactions contemplated hereunder, to the other party,
for review and comment at least twelve (12) hours prior to issuance.
IN WITNESS WHEREOF, the undersigned have executed this Agreement and Bill
of Sale the day and year first above written.
BIO-REFERENCE LABORATORIES, INC.
By_______________________________________
Name: Howard Dubinett
Title: Executive Vice President
IMPATH INC.
By______________________________________
Name: John P. Gandolfo
Title: Executive Vice President
BRLI - IMPATH AGREEMENT AND BILL OF SALE
SCHEDULE I
ASSETS
1. Customer list of Hospital and Physician clients of the GenCare Division
("GenCare") of BRLI (attached).
2. The "GenCare" Tradename (to the extent BRLI and GenCare have any rights
to such name).*
3. Patient records in GenCare's possession utilized in the graphic
presentation of serum tumor marker results for patients of Hospitals and
Physician clients of GenCare.
4. GenCare and BRLI's rights under a Reagant Purchase and Equipment Rental
Contract dated April 10, 1997 with Becton Dickinson and Company.
5. GenCare and BRLI's rights under a Laboratory Testing Service Agreement
dated September 24, 1997 with St. Joseph's Hospital (Paterson, N.J.).
- --------
*The parties agree that BRLI shall be permitted to retain any and all
rights which it may have to the Tradename "GenPath" and to use same after
completion of the sale contemplated hereunder.
BRLI - IMPATH AGREEMENT AND BILL OF SALE
SCHEDULE II
ASSUMED LIABILITIES
1. GenCare and BRLI's liabilities under a Reagant Purchase and Equipment
Rental Contract dated April 10, 1997 with Becton Dickinson and Company.
GenCare and BRLI represent that all installment payments due under the
Reagant Purchase and Equipment Rental Contract up through the date of the
Agreement and Bill of Sale have been paid in full to Becton Dickinson and
Company.
2. GenCare and BRLI's liabilities under a Laboratory Testing Service
Agreement dated September 24, 1997 with St. Joseph's Hospital (Paterson, N.J.).
BRLI - IMPATH AGREEMENT AND BILL OF SALE
SCHEDULE III
RESTRICTED TESTS, RESTRICTED CUSTOMERS AND RESTRICTED PERIODS
1(a) RESTRICTED TEST
Serum Tumor Markers: AFP, B2M, HcG, CA 125, CA 19-9, CA 15-3, CA
27.29, CEA and any additional Serum Tumor Marker Tests which come
into the market during the Restricted Period.
(b) Restricted Customers
Any GenCare Physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor any of its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period for any Hematology or
Oncology specialty practice except those specifically listed on
Schedule III-X attached hereto or the successors to the bulk of any
such practice. If BRLI shall acquire a majority ownership or control
interest during the Restricted Period in another testing laboratory
which at the time of acquisition is performing Serum Tumor Marker
testing for any Hematology or Oncology specialty practice, it can
continue to perform such testing for such practices after the
acquisition but shall not perform such testing after the acquisition
and during the Restricted Period for any other Hematology or
Oncology speciality practice. Except as set forth in the three
preceding sentences, nothing herein shall prevent BRLI or its
subsidiaries or its affiliated entities*** from performing such
tests for anyone other than the Restricted Customers.
(c) Restricted Period
- --------
**As used in this Schedule III, a "hospital" customer is a
hospital whose specimens are derived directly from the hospital's
own on-premises laboratory as well as a hospital which has
contracted out its anatomical pathology function in whole or in part
to a pathology group.
***As used in this Schedule III, a BRLI "subsidiary" means a
BRLI beneficially majority-owned subsidiary and a BRLI "affiliated
entity" means a BRLI subsidiary or affiliated entity in which BRLI
has a 50% or greater ownership interest in the assets, income or
equity, or which BRLI has by ownership of voting power, agreement or
otherwise, the power to control.
Thirty (30) months from September 30, 1997.
2(a) RESTRICTED TEST
Cancer Cytogenetics
(b) Restricted Customers
Any GenCare physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor any of its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period.
(c) Restricted Period
Thirty (30) months from September 30, 1997.
3(a) RESTRICTED TEST
Gene Rearrangements: Southern blotting techniques and PCR
techniques for lymphomas and leukemia.
(b) Restricted Customers
Any GenCare Physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor any its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period.
(c) Restricted Period
Thirty (30) months from September 30, 1997.
4(a) RESTRICTED TEST
ERPR and any additional breast cancer marker testing including
CATHEPSIN D and HER2-NEU/ERB-2 testing.
(b) Restricted Customers
Any GenCare physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor any of its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period.
(c) Restricted Period
Thirty (30) months from September 30, 1997.
5(a) RESTRICTED TEST
Bone Marrow Analyses: Defined as Hematopathology analysis
on bone marrow smears, aspirates, core and/or clots.
(b) Restricted Customers
Any GenCare Physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period.
(c) Restricted Period
Thirty (30) months from September 30, 1997.
6(a) RESTRICTED TEST
Immunohistochemistry
(b) Restricted Customers
Any GenCare Physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor any of its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period for any Hematology or
Oncology specialty practice or any breast centers or pathology
practice management companies except those specifically listed on
Schedule III-X attached hereto or the successors to the bulk of any
such practice. If BRLI shall acquire a majority ownership or control
interest during the Restricted Period in another testing laboratory
which at the time of acquisition is performing Immunohistochemistry
testing for any Hematology or Oncology specialty practice or any
breast centers or pathology practice management companies, it can
continue to perform such testing for such practices after the
acquisition but shall not perform such testing after the acquisition
and during the Restricted Period for any other Hematology or
Oncology speciality practice or any other breast centers or
pathology practice management companies. Except as set forth in the
three preceding sentences, nothing herein shall prevent BRLI or its
subsidiaries or its affiliated entities*** from performing such
tests for anyone other than the Restricted Customers.
(c) Restricted Period
Thirty (30) months from September 30, 1997.
7(a) RESTRICTED TEST
Flow Cytometry Analysis: Defined as any analysis using a flow
cytometer including but not limited to DNA Ploidy Analysis, HIV
monitoring of CD4/CD8 ratios, Lymphoma or Leukemia Flow Cytometry
Analysis.
(b) Restricted Customers
Any GenCare Physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor any of its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period, provided that nothing
herein shall preclude BRLI or any of its subsidiaries or its
affiliated entities*** from performing HIV monitoring
of CD4/CD8 ratios for anyone other than a Restricted
Customer.
(c) Restricted Period
Thirty (30) months from September 30, 1997.
8(a) RESTRICTED TEST
Image Analysis
(b) Restricted Customers
Any GenCare Physician client who ever ordered such test from GenCare
as well as any hospital.** In addition, neither BRLI nor any of its
subsidiaries nor its affiliated entities*** will perform any of
these tests during the Restricted Period for any Hematology or
Oncology specialty practice except those specifically listed on
Schedule III-X attached hereto or the successors to the bulk of any
such practice. If BRLI shall acquire a majority ownership or control
interest during the Restricted Period in another testing laboratory
which at the time of acquisition is performing Image Analysis
testing for any Hematology or Oncology specialty practice, it can
continue to perform such testing for such practices after the
acquisition but shall not perform such testing after the acquisition
and during the Restricted Period for any other Hematology or
Oncology speciality practice. Except as set forth in the three
preceding sentences, nothing herein shall prevent BRLI or its
subsidiaries or its affiliated entities*** from performing such
tests for anyone other than the Restricted Customers.
(c) Restricted Period
Thirty (30) months from September 30, 1997.
BRLI - IMPATH AGREEMENT AND BILL OF SALE
SCHEDULE IV
WIRE INSTRUCTIONS
Bank of New York
1 Wall Street
New York, New York
ABA #021000018
Credit: Gotham Bank of New York
Account #8900003731
For further credit to: Bio-Reference Laboratories, Inc.
Account #0007-003-471
BRLI - IMPATH AGREEMENT AND BILL OF SALE
SCHEDULE V
PURCHASE PRICE ALLOCATION
Pursuant to Internal Revenue Code Section 1060 and the treasury
regulations thereunder, the parties agree to an allocation of the purchase price
as follows:
Purchase price $6,000,000
Class IV Assets $6,000,000
Class IV Assets are intangibles, good will, going-concern, customer lists,
covenants not to compete and the like.
BRLI - IMPATH AGREEMENT AND BILL OF SALE
SCHEDULE VI
CONSENTS REQUIRED TO BE OBTAINED BY BRLI
TO CONSUMMATE THE TRANSACTIONS
CONTEMPLATED BY THE AGREEMENT AND BILL OF SALE
1. Consent of PNC Bank, National Association (obtained).
2. Consent of Becton Dickinson and Company to assignment of BRLI's and
GenCare's rights under the Reagant Purchase and Equipment Rental Contract dated
April 10, 1997 (obtained).
BRLI - IMPATH AGREEMENT AND BILL OF SALE
SCHEDULE VII
LIENS AGAINST THE ASSETS
1. Lien of PNC Bank, National Association (waived).
2. Lien of Becton Dickinson and Company (released).