ASSET PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”), dated as of February 5, 2018,
is made and entered into by and among Vera Acquisition, LLC, a Utah limited
liability company (the “Purchaser”), Anu Life Sciences, Inc., a Florida
corporation (the “Seller”), Biotech Products Services and Research, Inc., a
Nevada corporation (the “Parent”), the stockholders and/or officers of the
Parent set forth on the signature pages hereto (collectively, the “Controlling
Stockholders”) and General Surgical Florida, Inc., a Florida corporation
(“General Surgical”). The Purchaser, the Seller, General Surgical and the
Controlling Stockholders are sometimes individually referred to herein as a
“Party” and collectively as the “Parties.”

 

RECITALS

 

WHEREAS, the Parent owns all of the issued and outstanding shares of capital
stock and other equity interests of the Seller;

 

WHEREAS, the Controlling Stockholders collectively own 100% of the outstanding
shares of Series A Non-Convertible Preferred Stock, par value $0.001 per share
(the “Series A Preferred Stock”), representing eighty percent (80%) of all votes
entitled to be voted at any annual or special meeting of stockholders of the
Parent or action by written consent of stockholders;

 

WHEREAS, General Surgical is a wholly-owned subsidiary of the Parent and an
Affiliate of the Seller;

 

WHEREAS, the Seller is engaged in the business of manufacturing, designing and
engineering placental tissue-based products, including the use of tissues or
related biomaterials derived from amniotic fluid, amnion and chorion layers of
the amniotic membrane, umbilical cord and the placenta (the “Business”);

 

WHEREAS, the Parties desire to enter into this Agreement pursuant to which the
Seller proposes to sell to the Purchaser, and the Purchaser proposes to purchase
from the Seller (the “Acquisition”), substantially all of the assets used or
held for use by the Seller in the conduct of its business as a going concern, on
the terms and subject to the conditions set forth herein;

 

WHEREAS, the Parent, the Seller, General Surgical and the Controlling
Stockholders have each entered into non-disclosure, non-solicitation and
non-competition Contracts attached to this Agreement as Exhibit A (the
“Restrictive Covenant Agreements”) with the Purchaser; and

 

WHEREAS, the Parties desire to make certain representations, warranties and
agreements in connection with the Acquisition.

 

NOW, THEREFORE, in consideration of the foregoing and the respective
representations, warranties, covenants, agreements and conditions hereinafter
set forth, and intending to be legally bound hereby, each Party hereby agrees:

 

 

 

 

Article I
CONSTRUCTION; DEFINITIONS

 

Section 1.1 Definitions. The following terms, as used herein, have the following
meanings:

 

“Affiliate” means with respect to any Person, any Person that directly or
indirectly controls, is controlled by or is under common control with such
Person. The term “control” (including the terms “controlled by” and “under
common control with”) means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by Contract, or otherwise.

 

“Assumed Contracts” means, except as set forth in Section 2.3, those Contracts
listed on Schedule 4.12(a) (unless indicated to the contrary thereon) and any
Contract that relates to the Business but is not required to be listed on
Schedule 4.12(a). For purposes of clarity, Assumed Contracts shall not include
any Employment Agreement, Employee Benefit Plan, insurance policy or any
Contract listed on Schedule 2.3(c).

 

“Balance Sheet” means the unaudited balance sheet of the Seller as of December
31, 2017 included in the Financial Statements.

 

“Cash” means all cash and cash equivalents of the Seller.

 

“Claims Period” means the period during which a claim for indemnification may be
asserted hereunder by an Indemnified Party.

 

“Closing” means the consummation of the transactions contemplated by this
Agreement as set forth in Section 9.1 of this Agreement.

 

“Closing Date” means the date of this Agreement.

 

“Closing Date Indebtedness” means the Indebtedness of the Seller outstanding as
of immediately prior to the Closing.

 

“COBRA Coverage” means continuation coverage required under Section 4980B of the
Code and Part 6 of Title I of ERISA or any similar state Law.

 

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

 

“Company Benefit Plan” means each Employee Benefit Plan currently sponsored or
maintained or required to be sponsored or maintained by the Seller or to which
the Seller makes, or has any obligation to make, directly or indirectly, any
contributions or with respect to which the Seller has, or might have, any
liabilities.

 

“Company Intellectual Property” means any Intellectual Property that is owned
by, used or held for use by, or licensed to the Seller, including the Company
Software and Company Registered Intellectual Property.

 

2

 

 

“Company Licensed Software” means all Software (other than Company Proprietary
Software) used or held for use by the Seller.

 

“Company Proprietary Software” means all Software owned by the Seller.

 

“Company Registered Intellectual Property” means all of the Registered
Intellectual Property owned by, filed in the name of, or licensed to the Seller.

 

“Company Software” means the Company Licensed Software and the Company
Proprietary Software.

 

“Confidential Information” means any data or information of the Seller
(including trade secrets) that is valuable to the operation of the Business and
not generally known to the public or competitors.

 

“Contracts” means all contracts, leases, licenses, arrangements, indentures,
notes, bonds, mortgages, loans, instruments, guaranties and other agreements
(including any amendments and other modifications thereto, but excluding all
purchase orders) to which the Seller is a party or which is otherwise binding on
the Seller (whether oral, written or otherwise).

 

“Copyleft License” means any license that requires, as a condition of use,
modification or distribution of Software, that such Software, or modifications
or derivative works thereof: (a) be made available or distributed in source code
form or (b) be licensed for the purposes of preparing derivative works or
distribution at no fee, including the GNU General Public License, GNU Affero
General Public License, the Mozilla Public License, the Common Development and
Distribution License and the Eclipse Public License.

 

“Copyleft Software” means any Software subject to any Copyleft License.

 

“Customer” means the top ten customers of the Seller, based on the dollar amount
of total revenue recognized and/or received by the Seller during the
twelve-month period ended on December 31, 2017.

 

“Employee Benefit Plan” means, with respect to any Person, (a) each plan, fund,
program, Contract, arrangement or scheme, in each case, that is or was at any
time sponsored or maintained or required to be sponsored or maintained by such
Person or to which such Person makes or has made, or has or has had an
obligation to make, contributions providing for employee benefits or for the
remuneration, direct or indirect, of the employees, former employees, directors,
managers, officers, consultants, independent contractors, contingent workers or
leased employees of such Person or the dependents of any of them (whether
written or oral), including each deferred compensation, bonus, incentive
compensation, pension, retirement, stock purchase, stock option and other equity
compensation plan, and “welfare” plan (within the meaning of Section 3(1) of
ERISA, determined without regard to whether such plan is subject to ERISA), (b)
each “pension” plan (within the meaning of Section 3(2) of ERISA, determined
without regard to whether such plan is subject to ERISA), (c) each severance,
retention or change in control plan or Contract, each plan or Contract providing
health, vacation, summer hours, supplemental unemployment benefit,
hospitalization insurance, medical, dental or legal benefit and (d) each other
employee benefit plan, fund, program, Contract, arrangement or scheme.

 

3

 

 

“Employment Agreement” means any employment Contract, consulting Contract,
termination or severance Contract, salary continuation Contract, change of
control Contract, non-compete Contract or any other Contract respecting the
terms and conditions of employment or payment of compensation, or of a
consulting or independent contractor relationship in respect to any current or
former officer, employee, consultant or independent contractor.

 

“Environment” means any surface or ground water, drinking water supply, stream
sediment, soil, surface or subsurface strata or medium, or the ambient air.

 

“Environmental Laws” means all federal, state, or local or foreign Laws relating
to protection of the Environment, health and safety, including pollution
control, product registration, Releases of Hazardous Materials, the use,
treatment, storage, disposal, transportation or handling of Hazardous Materials
or otherwise relating to Hazardous Materials.

 

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

 

“ERISA Affiliate” means any Person (whether incorporated or unincorporated) that
together with the Seller would be deemed a “single employer” within the meaning
of Section 414 of the Code.

 

“ERISA Affiliate Plan” means each Employee Benefit Plan sponsored or maintained
or required to be sponsored or maintained at any time by any ERISA Affiliate, or
to which such ERISA Affiliate makes or has made, or has or has had an obligation
to make, contributions at any time.

 

“Exhibit” means any exhibit attached to this Agreement.

 

“Financial Statements” means (a) the unaudited balance sheet of the Seller as of
October 31, 2017 and the unaudited income statements of the Seller for the
12-month period then ended and (b) the unaudited balance sheet of the Seller as
of December 31, 2017 and the unaudited income statements of the Seller for the
fiscal year-to-date period then ended.

 

“FMLA” means the U.S. Family and Medical Leave Act and the rules and regulations
promulgated thereunder.

 

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

 

“Governmental Entity” means any federal, state, local or foreign government, any
political subdivision thereof, or any court, arbitrator or arbitration panel,
administrative or regulatory agency, tribunal, department, instrumentality, body
or commission or other governmental authority or agency.

 

“Hazardous Materials” means any waste, pollutant, contaminant, hazardous
substance, toxic, ignitable, reactive or corrosive substance, hazardous waste,
special waste, industrial substance, by-product, process-intermediate product or
waste, asbestos or asbestos-containing materials, lead-based paint, petroleum or
petroleum-derived substance or waste, polychlorinated biphenyls, chemical
liquids or solids, liquid or gaseous products, or any constituent of any such
substance or waste, whether liquid, solid, semi-solid, sludge or gaseous, the
management, use, handling or disposal of which is in any way governed by or
subject to any applicable Law.

 

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“Holdback Amount” means $47,500.00.

 

“Holdback Release Date” means the date that is ninety (90) days from the Closing
Date.

 

“Indebtedness” means with respect to the Seller, all monetary obligations
(including any principal amount, premium, accrued and unpaid interest, fees and
prepayment premiums or penalties, commitment and other fees, reimbursements,
indemnities and all other amounts payable related thereto) (a) owed by the
Seller under a credit facility, (b) evidenced by any note, bond, debenture or
other debt security, or hedging and swap Contracts or Contracts or other similar
instruments, (c) for borrowed money, (d) for the deferred purchase price of
assets, property or services (including earn-out obligations), (e) for all lease
obligations of the Seller that are required by GAAP to be capitalized, (f) in
respect of any letter of credit, banker’s acceptance or similar credit
transaction (but, for purposes of determining the amount of Indebtedness, only
those obligations that are due and payable as of the Closing Date), (g) for all
obligations of others for borrowed money secured by (or for which the holder of
such obligation has an existing right, contingent or otherwise, to be secured
by) any Lien on property or assets owned or acquired by the Seller, whether or
not the obligation secured thereby has been assumed, (h) for severance
obligations for employee terminations prior to the Closing, (i) any prepayment,
breakage, make-whole or similar penalties or charges payable in connection with
the discharge of any Indebtedness of the Seller described in the preceding
clauses (a) through (h) as if paid in full at the Closing and (j) for all
Indebtedness of others referred to in clauses (a) through (i) guaranteed
directly or indirectly in any manner by such Person. Notwithstanding the
foregoing, Indebtedness does not include any operating lease obligations but
does include capital lease obligations.

 

“Indemnified Party” means a Purchaser Indemnified Party or a Seller Indemnified
Party, as applicable.

 

“Intellectual Property” means any or all of the following and all rights arising
out of or associated therewith: (a) all U.S. and foreign patents and
applications therefor and all reissues, reexaminations, inter parte reviews,
post-grant reviews, covered business method reviews, divisions, renewals,
extensions, provisionals, continuations and continuations-in-part thereof; (b)
all inventions (whether patentable or not), invention disclosures, improvements,
mask works, trade secrets, proprietary information, know-how, technology,
technical data and customer lists, and all documentation relating to any of the
foregoing throughout the world; (c) all works of authorship (whether
copyrightable or not), all copyrights, copyright registrations and applications
therefor, and all other rights corresponding thereto throughout the world; (d)
all industrial designs and any registrations and applications therefor
throughout the world; (e) all internet uniform resource locators, domain names,
social media identifiers and profiles, trade names, logos, slogans, designs,
trade dress, common Law trademarks and service marks, trademark and service mark
and trade dress registrations and applications therefor throughout the world and
goodwill related thereto; (f) all Software, databases and data collections and
all rights therein throughout the world; (g) all moral and economic rights of
authors and inventors, however denominated, throughout the world; and (h) any
similar or equivalent rights to any of the foregoing anywhere in the world.

 

5

 

 

“Knowledge” with respect to the Seller means (a) all facts known by any of the
Controlling Stockholders after due inquiry and diligence with respect to the
matters at hand and (b) all facts that any of the foregoing Persons should have
known with respect to the matters at hand if such Person had made due inquiry
and exercised reasonable diligence.

 

“Laws” means all statutes, rules, codes, regulations, restrictions, ordinances,
orders, decrees, approvals, directives, judgments, injunctions, writs, awards
and decrees of, or issued by, any Governmental Entity.

 

“Leased Real Property” means the parcels of real property of which the Seller is
the lessee (together with all fixtures and improvements thereon).

 

“Legal Dispute” means any claim, action, cause of action, lawsuit, demand,
investigation, audit, suit, proceeding, administrative or other enforcement
proceeding or arbitration proceeding before any Governmental Entity or
arbitrator.

 

“Licenses” means all notifications, licenses, Permits (including environmental,
construction and operation Permits), qualifications, franchises, certificates,
approvals, exemptions, classifications, registrations, clearances, consents and
other similar documents and authorizations issued by any Governmental Entity,
and applications therefor.

 

“Liens” means any and all mortgages, liens, pledges, security interests,
charges, claims, restrictions, deeds of trust, judgments, voting trusts, option,
deposit, covenant, encroachment, right of first refusal or other restrictions or
encumbrances of any nature whatsoever, including any restriction on use, voting,
receipt of income or exercise of any other attribute of ownership.

 

“Material Adverse Effect” means any change, effect, event, occurrence, state of
facts or development that, individually or in the aggregate, has had or would
reasonably be expected to have a material adverse effect upon (a) the condition
(financial or otherwise), business, assets, properties or results of operations
of the Seller, the Business or the Assets taken as a whole or (b) the ability of
the Seller to consummate the transactions contemplated hereby.

 

“Owner Ancillary Documents” means any certificate, Contract, document or other
instrument, other than this Agreement, to be executed and delivered by the
Seller, the Parent, General Surgical, any Controlling Stockholder or any
Affiliate of any Controlling Stockholder in connection with the transactions
contemplated hereby.

 

“Non-Assignable Contracts” means Assumed Contracts that require third party
consents for assignment that have not been obtained by the Seller as of the
Closing.

 

“Ordinary Course” means the ordinary course of business of the Seller consistent
with past practice.

 

“Open Source License” means any license meeting the open source definition (as
currently promulgated by the Open Source Initiative) or the free software
definition (as currently promulgated by the Free Software Foundation), or any
substantially similar license, including any Copyleft License.

 

6

 

 

“Open Source Software” means any Software subject to an Open Source License,
including any Copyleft Software.

 

“Permits” means any approvals, clearances, exemptions, authorizations, consents,
licenses, registrations, permits or certificates of a Governmental Entity.

 

“Permitted Liens” means (a) Liens for Taxes not yet due and payable, (b)
statutory Liens of landlords, (c) Liens of carriers, warehousemen, mechanics,
materialmen and repairmen incurred in the Ordinary Course and not yet delinquent
that do not, individually or in the aggregate, have more than a de minimis
effect on the Business, and (d) in the case of Leased Real Property, zoning,
building, or other restrictions, variances, covenants, rights of way,
encumbrances, easements and other minor irregularities in title, none of which,
individually or in the aggregate, (i) interfere in any material respect with the
present use of or occupancy of the affected parcel by the Seller, (ii) have more
than a de minimis effect on the value thereof or its use or (iii) would impair
the ability of such parcel to be sold, leased or subleased for its present use.

 

“Person” means any individual, corporation, partnership, joint venture, limited
liability company, trust, unincorporated organization or Governmental Entity.

 

“Purchaser Ancillary Documents” means any certificate, Contract, document or
other instrument, other than this Agreement, to be executed and delivered by the
Purchaser in connection with the transactions contemplated hereby.

 

“Purchaser Indemnified Parties” means the Purchaser and its Affiliates, each of
their respective officers, directors, employees, agents and representatives and
each of the heirs, executors, successors and assigns of any of the foregoing.

 

“Registered Intellectual Property” means all U.S. and foreign: (a) patents and
patent applications (including provisional applications); (b) registered
trademarks and service marks, applications to register trademarks and service
marks, and trade dress, intent-to-use applications, or other registrations or
applications related to trademarks and service marks and trade dress; (c)
registered copyrights and applications for copyright registration; (d) domain
name registrations and registered or issued social media identifiers; (e)
registered mask works and applications for mask work registration; and (f) any
other Intellectual Property that is the subject of an application, certificate,
filing, registration or other document issued, filed with, or recorded with any
federal, state, local or foreign Governmental Entity or other public body or
registry.

 

“Release” means, with respect to any Hazardous Material, any spilling, leaking,
pumping, pouring, emitting, emptying, discharging, injecting, escaping,
leaching, dumping or disposing into the Environment.

 

“Schedule” means any schedule attached to this Agreement.

 

“Seller Indemnified Parties” means the Seller, the Parent, General Surgical, the
Controlling Stockholders and their Affiliates, each of their respective
officers, directors, employees, agents and representatives and each of the
heirs, executors, successors and assigns of any of the foregoing.

 

7

 

 

“Software” means all computer software programs, together with any error
corrections, updates, modifications, or enhancements thereto, in both
machine-readable form and human-readable form, including all related
documentation, comments and any procedural code.

 

“Supplier” means each of the top ten suppliers of the Seller (based on the
dollar amount of payments made by the Seller) during the twelve-month period
ended December 31, 2017.

 

“Tax Return” means any report, return, claim for refund, declaration or other
information return or statement required to be supplied to a Governmental Entity
relating to Taxes, including any schedule or attachment thereto and any
estimated returns, and any amendment thereof.

 

“Taxes” means all taxes, assessments, charges, duties, fees, levies and other
governmental charges (including interest, penalties or additions associated
therewith), including income, franchise, capital stock, real property, personal
property, tangible, withholding, employment, payroll, social security, social
contribution, unemployment compensation, unclaimed property escheat, disability,
transfer, sales, use, excise, license, occupation, registration, stamp, premium,
environmental, customs duties, alternative or add-on minimum, estimated, gross
receipts, value-added and all other taxes of any kind imposed by any
Governmental Entity.

 

“Transaction Expenses” means (a) the costs, fees, expenses and disbursements
payable to legal counsel, consultants and accountants of the Seller, the Parent,
General Surgical and the Controlling Stockholders in connection with the
transactions contemplated hereby and the agreements referred to herein (whether
incurred prior to or after the date of this Agreement), (b) all other costs,
fees, expenses and disbursements, in each case, incurred by the Seller, the
Parent, General Surgical or the Controlling Stockholders in connection with the
transactions contemplated by this Agreement and the agreements referred to
herein (whether incurred prior to or after the date of this Agreement),
including any brokerage fees, commissions, finders’ fees or financial advisory
fees, any Tax, financial advisory and other third party advisory, professional
or consulting fees, (c) amounts payable (including sale bonuses, stay bonuses,
change of control payments, “success fees” or bonuses or severance payments,
retention payments or other similar payments (and any related employment Taxes)
and any amounts payable to offset any excise Taxes imposed under Section 4999 of
the Code and any related income Taxes) by the Seller, the Parent, General
Surgical or the Controlling Stockholders (i) to any third party solely as a
result of the transactions contemplated by this Agreement or (ii) to or for the
benefit of current or former officers, directors or employees of the Seller,
including (A) accrued and unpaid compensation and bonuses as of the Closing Date
(even if unrelated to the transactions contemplated by this Agreement) and (B)
amounts payable as a result of the transactions contemplated by this Agreement
(whether prior to, on or following the Closing Date), (e) all obligations owed
by the Seller to current and former employees and their dependents under any
pension or deferred compensation plan, (f) all outstanding severance and
retention obligations (including the employer portion of any employment or
payroll Taxes related thereto) and (g) any prepayment, breakage, make-whole or
similar penalties or charges payable in connection with the discharge of any
Transaction Expenses of the Seller, the Parent, General Surgical or the
Controlling Stockholders described in the preceding clauses (a) through (f) as
if paid in full at the Closing.

 

“Treasury Regulations” means the Income Tax Regulations, promulgated under the
Code.

 

8

 

 

“U.S.” means the United States of America.

 

“WARN” means the U.S. Worker Adjustment and Retraining Notification Act and the
rules and regulations promulgated thereunder.

 

Section 1.2 Construction. Unless the context of this Agreement otherwise clearly
requires, (a) references to the plural include the singular, and references to
the singular include the plural, (b) references to one gender include the other
gender, (c) the words “include,” “includes” and “including” do not limit the
preceding terms or words and shall be deemed to be followed by the words
“without limitation”, (d) the terms “hereof”, “herein”, “hereunder”, “hereto”
and similar terms in this Agreement refer to this Agreement as a whole and not
to any particular provision of this Agreement, (e) the terms “day” and “days”
mean and refer to calendar day(s), (f) the terms “year” and “years” mean and
refer to calendar year(s), (g) all references in this Agreement to “dollars” or
“$” shall mean U.S. Dollars, and (h) the word “extent” in the phrase “to the
extent” shall mean the degree to which a subject or other thing extends, and
such phrase shall not mean simply “if”. Unless otherwise set forth herein,
references in this Agreement to (i) any document, instrument or agreement
(including this Agreement) (A) includes and incorporates all exhibits, schedules
and other attachments thereto, (B) includes all documents, instruments or
agreements issued or executed in replacement thereof and (C) means such
document, instrument or agreement, or replacement or predecessor thereto, as
amended, modified or supplemented from time to time in accordance with its terms
and in effect at any given time, and (ii) a particular Law means such Law as
amended, modified, supplemented or succeeded, from time to time and in effect at
any given time. All Article, Section, Exhibit and Schedule references herein are
to Articles, Sections, Exhibits and Schedules of this Agreement, unless
otherwise specified. This Agreement shall not be construed as if prepared by one
of the Parties, but rather according to its fair meaning as a whole, as if all
Parties had prepared it.

 

Section 1.3 Accounting Terms. All accounting terms not specifically defined
herein shall be construed in accordance with GAAP.

 

Article II
PURCHASE AND SALE

 

Section 2.1 Agreement to Purchase and Sell. Contemporaneously with the execution
and delivery of this Agreement, subject to the terms and conditions of this
Agreement, the Seller, in consideration for the payment of the Purchase Price
and the assumption of the Assumed Liabilities, will grant, sell, assign,
transfer and deliver to the Purchaser, and the Purchaser will purchase and
acquire from the Seller, all right, title and interest of the Seller in and to
(a) the Business and (b) except for the Excluded Assets, all of the assets,
properties and rights of the Seller of every kind and description, real,
personal and mixed, tangible and intangible, wherever situated (which assets,
properties and rights are collectively referred to in this Agreement as the
“Assets”), free and clear of any and all Liens (other than Permitted Liens), and
the Purchaser shall assume the Assumed Liabilities.

 

9

 

 

Section 2.2 Assets. Except as otherwise expressly set forth in Section 2.3, the
Assets shall include the following assets, properties and rights of the Seller
as of the Closing Date:

 

(a) all raw and finished goods inventory, including office and other supplies,
spare, replacement and component parts, and other inventory property located at,
stored on behalf of or in transit to the Seller;

 

(b) all deposits with vendors in connection with leases and/or services,
advances, pre-paid expenses, accrued rebates and credits, including any security
deposits;

 

(c) all fixed assets, equipment, furnishings, computer hardware, vehicles,
fixtures and other tangible personal property;

 

(d) all rights of the Seller under the Assumed Contracts;

 

(e) all rights of the Seller in and to the Leased Real Property and under the
leases related thereto;

 

(f) all goodwill, patents, patent applications, copyright registrations,
copyrights, copyright applications, methods, know-how, Software, technical
documentation, original works of authorship, processes, procedures, inventions,
trade secrets, confidential information, trademarks or trademark rights (whether
registered or not, an expressly including Anu Life Sciences, RHEO and Vendaje),
trade names, service marks, service names, registrations for and applications to
register trademarks and service marks, registered domain names, technology,
research records, data, designs, plans, drawings, manufacturing know-how and
formulas, whether patentable or unpatentable, and other intellectual or
proprietary rights or property of the Seller (and all rights thereto and
applications therefor), including all Company Intellectual Property;

 

(g) all rights to Legal Disputes or judgments of any nature available to or
being pursued by the Seller related to or arising from the Assets, whether
arising by way of counterclaim or otherwise;

 

(h) all rights in and under all express or implied guarantees, warranties,
representations, covenants, indemnities and similar rights in favor of the
Seller arising from or relating to the Assets;

 

(i) all Licenses to the extent that they are assignable, including those set
forth on Schedule 4.25 (unless otherwise indicated thereon);

 

(j) all information, files, correspondence, records, data, plans, reports,
Contracts and recorded knowledge, including customer, supplier, price and
mailing lists, and all accounting or other books and records of the Seller (and
relevant data pertaining to the Business owned or controlled by General
Surgical) in whatever media retained or stored, including computer programs and
disks; and

 

10

 

 

(k) all other tangible and intangible assets, properties and rights of any kind
or description, wherever located, that are (i) carried on the books of the
Seller or (ii) owned by the Seller.

 

Notwithstanding anything set forth herein to the contrary, the Assets shall
include those items set forth on Schedule 2.2.

 

Section 2.3 Excluded Assets. Notwithstanding anything to the contrary set forth
in this Agreement, the Assets will not include the following assets, properties
and rights of the Seller (collectively, the “Excluded Assets”):

 

(a) all ownership and other rights with respect to any Employment Agreement that
the Seller is a party to or has liability under, any Company Benefit Plan and
any ERISA Affiliate Plan;

 

(b) any License or similar right that by its terms is not transferable to the
Purchaser, including those indicated on Schedule 4.25 as not being transferable;

 

(c) the Contracts listed on Schedule 2.3(c);

 

(d) the Related Party Agreements;

 

(e) all rights of the Seller in and to any real property leased by the Seller
and under the leases related thereto;

 

(f) any Cash and all rights to any bank accounts of the Seller;

 

(g) all accounts receivable, notes receivable and other receivables and any
security therefor, including all accounts receivable from third parties that are
recorded by General Surgical in connection with the sale of Seller’s products
through and including the Closing Date;

 

(h) The trademark and trademark rights for the name Organicell and the trademark
rights for Frozen Facelift.

 

(i) the charter documents of the Seller, minute books, stock ledgers, Tax
Returns, books of account and other constituent records relating exclusively to
the organization of the Seller;

 

(j) the rights that accrue to the Seller under this Agreement; and

 

(k) the computer currently being used by Seller employee, Heidi Kramerman;

 

Section 2.4 Assumption of Assumed Liabilities.

 

(a) Except as provided in Section 2.4(b), the Purchaser shall not assume, in
connection with the transactions contemplated by this Agreement, any liability
or obligation of the Seller whatsoever, and the Seller shall retain
responsibility for all liabilities and obligations accrued as of or on the
Closing Date and all liabilities and obligations arising from the Seller’s
operations prior to or on the Closing Date, whether or not accrued and whether
or not disclosed.

 

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(b) As the sole exception to the provisions in Section 2.4(a), effective as of
the Closing Date, the Purchaser shall assume the following liabilities and
obligations of the Seller existing as of immediately prior to the Closing on
such date and arising out of the conduct of the Business prior to or on the
Closing Date (collectively, the “Assumed Liabilities”):

 

(i) the obligations of the Seller under each Assumed Contract to the extent such
obligations are not required to be performed on or prior to the Closing Date,
are disclosed on the face of such Assumed Contract, accrue and relate to the
operations of the Business subsequent to the Closing Date and do not arise from
a breach or default thereof or failure to timely perform in each case occurring
prior to the Closing Date; and

 

Section 2.5 Excluded Liabilities. Specifically, and without in any way limiting
the generality of Section 2.4(a), the Assumed Liabilities shall not include, and
in no event shall the Purchaser assume, agree to pay, discharge or satisfy any
liability or obligation under this Agreement or otherwise have any
responsibility for, any liability or obligation (together with all other
liabilities of the Seller that are not Assumed Liabilities, the “Excluded
Liabilities”):

 

(a) relating to any liability or obligation (including accounts payable) owed to
the Seller or any Controlling Stockholder or any of their respective Affiliates;

 

(b) for Taxes, including relating to (i) any liability or obligation for the
unpaid Taxes of the Seller or any equityholder or former equityholder of the
Seller, including deferred income Taxes, with respect to any period or (ii) any
Taxes (including, for the avoidance of doubt, any sales or use Taxes) arising
out of or relating to events which shall have occurred, or services performed,
or products sold, or the operation of the Business or ownership of the Assets
prior to the Closing;

 

(c) for any Indebtedness, including the Closing Date Indebtedness, including any
interest or penalties accrued thereon;

 

(d) relating to, resulting from or arising out of (i) claims made in pending or
future Legal Disputes or (ii) claims based on violations of Law, breach of
Contract, employment practices, or environmental, health and safety matters or
any other actual or alleged failure of the Seller to perform any obligation, in
each case arising out of, or relating to, (A) events that shall have occurred,
(B) services performed, or (C) the operation of the Business, in each case,
prior to the Closing;

 

(e) relating to, resulting from or arising out of any claims by any holder or
purported holder of capital stock or other equity interests in the Seller as a
result of the transactions contemplated by this Agreement, other than any claims
(i) relating to the Purchaser’s failure to pay any portion of the Purchase Price
pursuant to this Agreement, (ii) against the Purchaser or any of its Affiliates
unrelated in any way to the Seller or (iii) against the Purchaser arising under
this Agreement or any Purchaser Ancillary Document;

 

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(f) pertaining to any Excluded Asset;

 

(g) relating to, resulting from or arising out of any former operations of the
Seller or predecessor entities thereof that have been discontinued or disposed
of prior to the Closing;

 

(h) under or relating to any Employment Agreement, Employee Benefit Plan,
Company Benefit Plan, or ERISA Affiliate Plan whether or not such liability or
obligation arises prior to, on, or following the Closing Date;

 

(i) relating to any non-compliance by the Seller with any applicable bulk sales
Law; or

 

(j) for any Transaction Expenses.

 

Such Excluded Liabilities shall include all Legal Disputes relating to any or
all of the foregoing and all costs and expenses in connection therewith.

 

Section 2.6 Further Assurances. Each Party shall on the Closing Date and from
time to time thereafter, at any other Party’s reasonable request and without
further consideration, execute and deliver to such other Party such instruments
of transfer, conveyance, and assignment as shall be reasonably requested to
transfer, convey, and assign the Assets to the Purchaser and otherwise to effect
the transactions contemplated by this Agreement.

 

Article III
PURCHASE PRICE

 

Section 3.1 Purchase Price. The aggregate cash amount to be paid for the Assets
by the Purchaser at Closing (the “Closing Payment”) shall be an amount equal to
(a) $850,000 (the “Purchase Price”), minus (b) the Holdback Amount, minus (c)
the Closing Date Indebtedness.

 

Section 3.2 Closing Date Indebtedness Statement. Attached hereto as Exhibit B is
a statement (the “Closing Date Indebtedness Statement”), signed by the Chief
Executive Officer of the Parent, which sets forth, by lender, the Closing Date
Indebtedness owed by Parent and secured by the assets of the Parent and its
subsidiaries, including the Assets of the Seller. Attached to the Closing Date
Indebtedness Statement are copies of the Payoff Letters.

 

Section 3.3 Payment of Closing Payment. Contemporaneously with the execution and
delivery of this Agreement, the Purchaser shall (i) on behalf of the Parent, pay
to such account or accounts as the Parent specifies to the Purchaser pursuant to
the Closing Date Indebtedness Statement, the aggregate amount of the Closing
Date Indebtedness and (ii) pay to the Seller, to such account specified to the
Purchaser by the Seller, the Closing Payment. Upon the payment of the Closing
Date Indebtedness and the remaining portion of the Closing Payment by the
Purchaser in accordance with this Section 3.3, the Purchaser shall be fully
released and discharged of any obligation with respect to the payment of the
Closing Payment.

 

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Section 3.4 Payment of Holdback Amount. On the Holdback Release Date, the
Purchaser shall pay to the Seller the Holdback Amount, less (i) all Purchaser
Losses paid from the Holdback Amount prior to the Holdback Release Date (which
Seller shall be provided a calculation prior to the payment/offset for any
Purchaser Losses); (ii) all unresolved indemnification claims of the Purchaser
Indemnified Parties, which amounts shall be distributed to the Seller or
retained by the Purchaser, as applicable, as such amounts are determined or
resolved; notwithstanding the foregoing, the parties acknowledge and agree that
the Purchaser may delay the payment of the Holdback Amount until it is furnished
with a Certificate of Compliance with the Florida Department of Revenue
regarding the Seller’s satisfaction of all tax liabilities as of the Closing
Date. The amount by which the Holdback Amount is reduced to satisfy Purchaser
Losses pursuant to this Agreement shall be deemed to be a reduction in the
Purchase Price.

 

Section 3.5 Indemnification Reserve.

 

(a) Each of the Parent and General Surgical covenant and agree to set aside
fifty percent (50%) of the accounts receivable set forth on Schedule 4.24(b)
collected or otherwise received by or on behalf of the Parent, General Surgical
or any of their Affiliates, and fifty percent (50%) of all amounts payable to
the Parent under the Distributor Agreement, from and after the Closing until the
Holdback Release Date, up to an aggregate maximum of $47,500.00 (the
“Indemnification Reserve”). The Parent and General Surgical shall immediately
transfer to the Purchaser all such cash and cash equivalents set aside pursuant
to the Indemnification Reserve shall be held by the Purchaser as additional
security for the indemnification obligations of Seller, the Parent, General
Surgical and the Controlling Stockholders under Article X in a manner reasonably
acceptable to the Purchaser.

 

(b) On the Holdback Release Date, the Purchaser shall pay to the Seller the
Indemnification Reserve, less (i) all Purchaser Losses paid from the
Indemnification Reserve prior to the Holdback Release Date; and (ii) all
unresolved indemnification claims of the Purchaser Indemnified Parties, which
amounts shall be distributed to the Seller or retained by the Purchaser, as
applicable, as such amounts are determined or resolved. The amount by which the
Indemnification Reserve is reduced to satisfy Purchaser Losses pursuant to this
Agreement shall be deemed to be a reduction in the Purchase Price.

 

Section 3.6 Release. In consideration for the agreement and covenants of the
Purchaser set forth in this Agreement, the Seller, the Parent, General Surgical
and each Controlling Stockholder (collectively the “Seller Parties”), on behalf
of itself and its respective Affiliates, hereby irrevocably, knowingly,
voluntarily and unconditionally releases, forever discharges and covenants not
to sue the Purchaser and its predecessors, successors, parents, subsidiaries and
other Affiliates, and any of its current and former officers, directors,
employees, agents, or representatives from and for any and all claims, causes of
action, demands, suits, debts, obligations, liabilities, damages, losses, costs,
and expenses (including attorneys’ fees) of every kind or nature whatsoever,
known or unknown, actual or potential, suspected or unsuspected, fixed or
contingent, that the Seller Parties have or may have, now or in the future,
arising out of, relating to, or resulting from any act of commission or
omission, errors, negligence, strict liability, breach of Contract, tort,
violations of Law, matter or cause whatsoever from the beginning of time to the
Closing Date; provided, however, that such release shall not cover: (a) any
claims against the Purchaser or any of its Affiliates unrelated in any way to
the Business or arising from fraud, malfeasance, criminal activity or willful
misconduct, (b) any claims against the Purchaser arising under this Agreement,
any Owner Ancillary Document or any Purchaser Ancillary Document or (c) to the
extent applicable, if the Controlling Stockholder is an employee of the Seller,
(i) compensation or employee benefits relating to the Controlling Stockholder’s
status as an employee of the Seller, or (ii) reimbursement for expenses incurred
by the Controlling Stockholder in the ordinary course of his or her employment
which are reimbursable under any expense reimbursement policies of the Seller
that are not yet paid.

 

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Section 3.7 Withholding. Notwithstanding anything in this Agreement to the
contrary, each of the Seller and the Purchaser shall be entitled to deduct and
withhold, or cause to be deducted or withheld, from any amounts otherwise
payable pursuant to this Agreement to any Person such amounts as it is required
to deduct and withhold with respect to the making of such payment under the Code
and the rules and regulations promulgated thereunder, or any provision of state,
local or foreign Tax Law. To the extent that amounts are so withheld, such
withheld amounts shall be treated for all purposes of this Agreement as having
been paid to the Person in respect of which such deduction and withholding was
made.

 

Section 3.8 Allocation of Purchase Price. Within 90 days following the Closing,
the Purchaser shall prepare and deliver to the Seller an allocation of the
adjusted Purchase Price (including any liabilities treated as consideration for
federal income tax purposes) among the Assets and the Restrictive Covenant
Agreements (the “Allocation Schedule”). The Purchaser shall prepare such
Allocation Schedule in accordance with the Code and the Treasury Regulations
promulgated thereunder. The Purchaser shall provide Seller with draft Allocation
Schedule for its internal review and comment prior to finalization. If Seller
notifies Purchaser in writing that Seller objects to one or more items reflected
in the Allocation Schedule, Seller and Purchaser shall negotiate in good faith
to resolve such dispute; provided that any such dispute shall be resolved by an
independent qualified accountant of Purchaser’s choosing. Purchaser and Seller
shall file all Tax Returns (including amended returns and claims for refund) and
information reports in a manner consistent with the Allocation Schedule.

 

Section 3.10 Allocation of Certain Items. With respect to certain expenses
incurred with respect to the Assets in the operation of the Business, the
following allocations shall be made between the Purchaser on the one hand and
the Seller on the other:

 

(a) Taxes. Real and ad valorem property Taxes shall be apportioned at the
Closing based upon the amounts set forth in the current tax bills therefore and
the number of days in the taxable period prior to (and including) the Closing
Date and in the taxable period following the Closing Date.

 

(b) Operations. Utilities, water, sewer charges and rent under the Seller’s
Lease Agreement, dated May 23, 2017, with Sunwest Office Park LLC shall be
apportioned based upon the number of days occurring prior to (and including) the
Closing Date and following the Closing Date during the billing period for each
such charge.

 

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(c) Workers’ Compensation. Pursuant to the provisions of this Agreement, the
Seller shall be responsible for and pay any and all workers’ compensation and
other similar claims asserted by or with respect to any employee or former
employee of the Seller (or any of them) in respect of any injury or other
compensable event or occupational illness or disease that occurred or is
attributable to any event, state of facts or condition that existed or occurred
in whole prior to or on the Closing Date. The Purchaser is responsible for and
shall pay any and all workers’ compensation and other similar claims asserted by
or with respect to any Transferred Employee in respect of any injury or other
compensable event or occupational illness or disease that occurred or is
attributable to any event, state of facts or condition that existed or occurred
in whole following the Closing Date. In the event any such injury or other
compensable event or occupational illness or disease of a person who was
employed both by the Seller prior to or on the Closing Date and by the Purchaser
following the Closing Date is attributable in part to causes occurring prior to
or on the Closing Date and is the basis of a workers’ compensation or other
similar claim asserted following the date of this Agreement, then liability for
any such claim shall be the responsibility of the Seller.

 

Appropriate cash payments by the Purchaser or the Seller, as the case may
require, shall be made hereunder from time to time as soon as practicable after
the facts giving rise to the obligation for such payments are known in the
amounts necessary to give effect to the allocations provided for in this Section
3.10.

 

Article IV
REPRESENTATIONS AND WARRANTIES RELATING TO THE SELLER

 

The Seller, the Parent, General Surgical and the Controlling Stockholders
hereby, jointly and severally, represent and warrant to the Purchaser as
follows:

 

Section 4.1 Organization. The Seller is a corporation duly incorporated and
validly existing under the Laws of Florida and has all requisite power and
authority to own, lease and operate its properties and to carry on its business
as now being conducted. The Seller is duly qualified or registered as a foreign
corporation to transact business under the Laws of each jurisdiction where the
character of its activities or the location of the properties owned or leased by
it requires such qualification or registration except where not to do so would
not have a Material Adverse Effect. The Controlling Stockholders have made
available to the Purchaser correct and complete copies of the organizational
documents of the Seller as currently in effect and any other record books with
respect to actions taken by its stockholders, board of directors, and officers,
as applicable. Schedule 4.1 contains a correct and complete list of the
jurisdictions in which the Seller is qualified or registered to do business as a
foreign corporation.

 

Section 4.2 Authorization. The Seller has the right, power, authority and
capacity to execute and deliver this Agreement and each Owner Ancillary Document
to which it is a party and to perform its obligations hereunder and thereunder
and to consummate the transactions contemplated hereby and thereby. The
consummation of the transactions contemplated hereby have been duly authorized
by all required action on the part of the Seller. This Agreement and the Owner
Ancillary Documents to which the Seller is a party have been duly executed and
delivered by the Seller and constitute the valid and binding agreements of the
Seller, enforceable against it in accordance with its terms, subject to
applicable bankruptcy, insolvency and other similar Laws affecting the
enforceability of creditors’ rights generally, general equitable principles and
the discretion of courts in granting equitable remedies.

 

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Section 4.3 Capital Structure.

 

(a) Schedule 4.3(a) accurately and completely sets forth the capital structure
of the Seller including the number and class of shares of capital stock or other
equity interests which are authorized and which are issued and outstanding. All
of the issued and outstanding shares of capital stock or other equity interests
of the Seller (i) are duly authorized, validly issued, fully paid and
nonassessable, (ii) are held of record by the Persons and in the amounts set
forth on Schedule 4.3(a), and (iii) were not issued or acquired by the holders
thereof in violation of any Law, Contract or the preemptive rights of any
Person. Other than the Parent, no other Person is the record holder of any
shares of capital stock or other equity interests in the Seller.

 

(b) Except as set forth on Schedule 4.3(a), no shares of capital stock or other
equity interests of the Seller are reserved for issuance or are held as treasury
shares, and (i) there are no outstanding options, warrants, rights, calls,
commitments, conversion rights, rights of exchange, subscriptions, claims of any
character, Contracts, obligations, convertible or exchangeable securities or
other plans or commitments, contingent or otherwise, relating to the capital
stock of the Seller; (ii) there are no outstanding Contracts of the Seller, the
Controlling Stockholders or any other Person to purchase, redeem or otherwise
acquire any outstanding shares of capital stock or other equity interests of the
Seller, or securities or obligations of any kind convertible into any shares of
capital stock or other equity interests of the Seller; (iii) there are no
dividends which have accrued or been declared but are unpaid on the shares of
capital stock or other equity interests of the Seller; (iv) there are no
outstanding or authorized equity appreciation, phantom stock, stock plans,
profit participation plans, equity plans or similar rights with respect to the
Seller; and (v) there are no voting Contracts or other similar Contracts
relating to the management or equity of the Seller. Other than the Parent, no
other Person is the record holder of any capital stock or other equity interests
in the Seller.

 

(c) The Seller has never purchased, redeemed or otherwise acquired any shares of
capital stock or other equity interests of the Seller. No prior offer, issue,
redemption, call, purchase, sale, transfer, negotiation or other transaction of
any nature or kind with respect to any shares of capital stock or other equity
interests (including options, warrants or debt convertible into shares, options
or warrants) of the Seller or any entity that has been merged into the Seller
has given rise to any Legal Dispute by any Person that is enforceable against
the Seller, the Parent, the Controlling Stockholders or the Purchaser, and no
fact or circumstance exists that could give rise to any such Legal Dispute.

 

(d) The Seller has never owned and does not own, directly or indirectly, any
capital stock or other equities, securities or interests in any other
corporation or in any corporation, limited liability company, partnership, joint
venture or other entity.

 

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(e) Schedule 4.3(e) sets forth a correct and complete description (including
amount) of all Indebtedness.

 

Section 4.4 Absence of Restrictions and Conflicts. The execution, delivery and
performance of this Agreement and the Owner Ancillary Documents, the
consummation of the transactions contemplated hereby and thereby, and the
fulfillment of and compliance with the terms and conditions hereof and thereof,
do not or will not (as the case may be), with the passing of time or the giving
of notice or both, violate or conflict with, constitute a breach of or default
under, result in the loss of any benefit under, permit the acceleration of any
obligation under or create in any party the right to terminate, modify or cancel
(a) any term or provision of the organizational documents of the Seller, (b)
except as indicated on Schedule 4.12(a), any Company Contract or any License
applicable to the Seller or any of its Controlling Stockholders, (c) any
judgment, decree or order of any court or Governmental Entity or agency to which
the Seller or any Controlling Stockholder is a party or by which the Seller or
any Controlling Stockholder or any of their respective properties are bound, or
(d) any Law or arbitration award applicable to the Seller or any Controlling
Stockholder. No consent, approval, order or authorization of, or registration,
declaration or filing with, any Governmental Entity is required with respect to
the Seller or any Controlling Stockholder in connection with the execution,
delivery or performance of this Agreement or the Owner Ancillary Documents, or
the consummation of the transactions contemplated hereby or thereby.

 

Section 4.5 Real Property.

 

(a) The Seller is not, and has never been, the owner of any real property.

 

(b) Schedule 4.5(b) sets forth a correct and complete legal description of the
Leased Real Property.

 

(c) The Seller, as listed on Schedule 4.5(b), has a valid leasehold interest in
the Leased Real Property, and the leases granting such interests are in full
force and effect.

 

(d) To Seller’s knowledge, no portion of the Leased Real Property, or any
building or improvement located thereon, violates any Law, including those Laws
relating to zoning, building, land use, environmental, health and safety, fire,
air, sanitation and noise control. Except for the Permitted Liens, no Leased
Real Property is subject to (i) any decree or order of any Governmental Entity
(or, to the Knowledge of the Seller, threatened or proposed order) or (ii) any
rights of way, building use restrictions, exceptions, variances, reservations or
limitations of any nature whatsoever.

 

(e) The improvements and fixtures on the Leased Real Property are in good
operating condition and in a state of good maintenance and repair, ordinary wear
and tear excepted, and are adequate and suitable for the purposes for which they
are presently being used. To Seller’s Knowledge, none of the buildings and
improvements owned or utilized by the Seller is constructed of, or contains as a
component part thereof, any material that, either in its present form or as such
material would reasonably be expected to change through aging and normal use and
service, releases any substance, whether gaseous, liquid or solid, that is or
may be, either in a single dose or through repeated and prolonged exposure,
injurious or hazardous to the health of any individual who may from time to time
be in or about such buildings or improvements. To the Seller’s Knowledge, there
is no condemnation, expropriation or similar Legal Dispute pending or, to the
Knowledge of the Seller, threatened against any of the Leased Real Property or
any improvement thereon. The Leased Real Property constitutes all of the real
property utilized by the Seller in the operation of the Business.

 

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Section 4.6 Title to Assets; Related Matters.

 

(a) Except as set forth on Schedule 4.6, the Seller has good and marketable
title to all of the Assets, free and clear of all Liens except Permitted Liens.

 

(b) All equipment and other items of tangible personal property and assets
included in the Assets (i) are in good operating condition and in a state of
good maintenance and repair, ordinary wear and tear excepted, (ii) were acquired
and are usable in the Ordinary Course and (iii) conform in all material respects
to all Laws applicable thereto. No Person other than the Seller owns any
equipment or other tangible personal property or assets situated on the premises
of the Seller, except for the leased items that are subject to personal property
leases. Except as set forth on Schedule 4.6, since December 31, 2016, the Seller
has not sold, transferred or disposed of any assets, other than sales and
disposal of inventory in the Ordinary Course. Schedule 4.6 sets forth a correct
and complete list and general description of each item of tangible personal
property of the Seller (including leased personal property) having a book value
of more than $5,000.

 

(c) The Assets are sufficient for the continued conduct of the Business after
the Closing in substantially the same manner as conducted prior to the Closing
and constitute all of the rights, property and assets necessary to conduct the
operations of the Business in accordance with the Seller’s past practices. None
of the Excluded Assets are material to the Business.

 

Section 4.7 Financial Statements. Correct and complete copies of the Financial
Statements are attached as Schedule 4.7 hereto. Except as expressly noted on
Schedule 4.7, the Financial Statements have been prepared in accordance with
GAAP from the books and records of the Seller, and such books and records have
been maintained on a basis consistent with GAAP. Each balance sheet included in
the Financial Statements (including any related notes and schedules) fairly
presents in all material respects the financial position of the Seller, as
applicable, as of the date of such balance sheet, and each statement of income
and cash flows included in the Financial Statements (including any related notes
and schedules) fairly presents in all material respects the results of
operations and changes in cash flows of the Seller for the periods set forth
therein, in each case in accordance with GAAP (except as expressly noted therein
or as disclosed on Schedule 4.7). Since December 31, 2016, there has been no
change in any accounting (or tax accounting) policy, practice or procedure of
the Seller. The Seller maintains accurate books and records reflecting each of
their assets and liabilities and maintains proper and adequate internal
accounting controls sufficient to provide reasonable assurances regarding the
reliability of financial reporting and the preparation of annual financial
statements for external purposes in accordance with GAAP.

 

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Section 4.8 No Undisclosed Liabilities. Except as disclosed on Schedule 4.8, the
Seller does not have any liability or obligation (whether absolute, accrued,
contingent or otherwise) that is not adequately reflected or provided for in the
Balance Sheet, except liabilities that have been incurred since December 31,
2017 in the Ordinary Course.

 

Section 4.9 Absence of Certain Changes. Except as set forth on Schedule 4.9,
since December 31, 2017:

 

(a) (i) the Seller has conducted its business and operations in the Ordinary
Course and (ii) there has not been any (A) change, occurrence, event, state of
facts, effect or development that has resulted in or would be reasonably likely
to result in a Material Adverse Effect or (B) damage, destruction, loss or
casualty to property or assets of the Seller with a value in excess of $5,000,
whether or not covered by insurance; and

 

(b) the Seller has:

 

(i) not (A) incurred any Indebtedness or indebtedness for borrowed money or
issued any long-term debt securities or assumed, guaranteed or endorsed such
obligations of any other Person, (B) made any loans, capital contributions,
investments or advances to, or made any guarantees or other endorsements or
incurred any liabilities (whether directly, contingently or otherwise) for the
benefit of, any Persons or (C) increased any reserves for contingent liabilities
(excluding any adjustment to bad debt reserves in the Ordinary Course);

 

(ii) not except in the Ordinary Course: (A) acquired, or disposed of, any
material property or assets; (B) mortgaged or encumbered any property or assets,
other than Permitted Liens; or (C) expressly canceled any debts owed to or
claims held by the Seller;

 

(iii) not entered into any Contracts that are or would constitute a Company
Contract, except Contracts made in the Ordinary Course;

 

(iv) not entered into any Contracts with, or forgiven any loans to, any
Affiliates, stockholders, directors, officers or employees of the Seller;

 

(v) except to the extent required by Law or any existing Contracts, not entered
into, adopted, amended or terminated any Contract relating to the compensation
or severance of any employee of the Seller, other than pursuant to annual
compensation reviews in the Ordinary Course;

 

(vi) not made any change to its accounting (including Tax accounting) methods,
principles or practices, except as may be required by GAAP;

 

(vii) not made any amendment to its certificate of organization or limited
liability company agreement (or equivalent organizational documents);

 

(viii) not declared or paid any dividends or distributions or repurchased or
redeemed any shares of capital stock or other equity interests;

 

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(ix) not transferred, issued or sold any capital stock or other equity interests
or options, warrants, calls, subscriptions or other rights to purchase any
capital stock or other equity interests of the Seller or split, combined or
subdivided the capital stock or other equity interests of the Seller;

 

(x) not (A) made or granted any bonus or any compensation (including incentive
compensation) or salary increase, or paid or agreed to pay any benefit to,
including severance or termination pay (except as may be required by any
existing Employee Benefit Plan), to any current (or former) manager, director,
officer or employee (except to employees who are not officers in the Ordinary
Course), (B) made or granted any increase in the coverage or benefits under any
employee benefit plan or arrangement, or amended or terminated any existing
employee benefit plan or arrangement, Employee Benefit Plan or severance
Contract or employment Contract, (C) adopted any new employee benefit plan or
arrangement, Employee Benefit Plan or severance Contract or employment Contract
(except as required by Law), (D) terminated the employment of any of its
officers or key employees (other than for cause) or (E) amended or terminated
any existing employment, consulting, termination or severance, salary
continuation, change of control, noncompete or other Contract regarding the
terms and conditions of employment or payment of compensation or of a consulting
or independent contractor relationship with the Seller or enter into any new
such Contract.;

 

(xi) not (A) sold or transferred any asset, other than finished goods sold in
the Ordinary Course, (B) granted, created, incurred or suffered to exist any
Lien on any asset of the Seller, (C) written off as uncollectible any guaranteed
check, note or account receivable or portion thereof, except in the Ordinary
Course, (D) written down the value of any asset or investment on the books or
records of the Seller, except for depreciation and amortization in the Ordinary
Course or (E) canceled any debt or waived any claim or right (except as provided
in Section 4.24(a));

 

(xii) (A) not engaged in any new line of business or activity or made any
commitment with respect to the Seller, except in the Ordinary Course, and (B)
maintained its existence and good standing in its jurisdiction of organization
and in each jurisdiction in which the leasing of its property or the conduct of
its business requires such qualification;

 

(xiii) (A) maintained in full force and effect and in the same amounts policies
of insurance comparable in amount and scope of coverage to that now maintained
by or on behalf of the Seller and (B) not canceled or terminated any insurance
policy naming it as a beneficiary or a loss payable payee without obtaining
comparable substitute insurance coverage;

 

(xiv) maintained its (A) books and records in the Ordinary Course and (B) cash
management practices in the Ordinary Course;

 

21

 

 

(xv) other than in the Ordinary Course, not (A) cancelled or compromised
Indebtedness or claim, (B) waived or released any right of material value or (C)
instituted, settled or agreed to settle any Legal Dispute;

 

(xvi) not (A) acquired any third party or its business (whether by merger,
acquisition of stock, acquisition of assets or otherwise), (B) solicited,
negotiated with, encouraged, initiated or engaged in discussions or negotiations
of any type with, or entered into any confidentiality Contract, letter of
intent, purchase Contract, merger Contract or similar Contract with, any Person,
(C) adopted a plan of complete or partial liquidation, dissolution,
restructuring or recapitalization, (D) split, combined or reclassified any of
its equity interests;

 

(xvii) not (A) entered into, modified or terminated any labor or collective
bargaining Contract, (B) agreed to provide a labor organization access to
employees of the Seller, (C) agreed to any neutrality Contract or other similar
Contract with any labor organization, (D) agreed to any voluntary recognition
of, or card check with, any labor organization or the National Labor Relations
Board or (E) effectuated a “plant closing” or “mass layoff” (as those terms are
defined under the WARN Act) affecting in whole or in part any site of
employment, facility, operating unit or employees of the Seller;

 

(xviii) not made, amended or revoked any material Tax elections, changed any
annual Tax accounting period, filed any amended Tax Returns, entered into any
closing agreement, settled any Tax claim, audit or assessment, or surrendered
any right to claim a Tax refund; or

 

(xix) not agreed to do any of the foregoing.

 

Section 4.10 Legal Proceedings. There is no Legal Dispute pending or threatened
against, relating to or involving the Seller or its real or personal property (a
“Legal Proceeding”). The Seller is not subject to any judgment, decree,
injunction, rule or order of any court or arbitration panel.

 

Section 4.11 Compliance with Laws. The Seller is (and has been at all times
since inception) in compliance in all material respects with all applicable
Laws. Except as set forth on Schedule 4.11, (a) the Seller has not been charged
with, nor received any written notice that it is under investigation with
respect to, and, to the Knowledge of the Seller, the Seller is not otherwise now
under investigation with respect to, any violation of any applicable Law or
other requirement of a Governmental Entity, (b) the Seller is not a party to, or
bound by, any order, judgment, decree, injunction, rule or award of any
Governmental Entity or arbitrator and (c) the Seller has filed all reports and
has all Licenses required to be filed with any Governmental Entity on or prior
to the date of this Agreement. The Seller does not sell, or has not ever sold,
any product or provided any services to any Governmental Entity. The Seller is
not currently a party or subject to any Contract with any Governmental Entity.
The Seller is not debarred or suspended from doing business with any
Governmental Entity.

 

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Section 4.12 Company Contracts.

 

(a) Schedule 4.12(a) sets forth a correct and complete list of the following
Contracts to which the Seller is a party, by which the Seller or any property of
any thereof is subject, or by which the Seller is otherwise bound, whether oral
or written (the “Company Contracts”) (other than the Employment Agreements set
forth on Schedule 4.14, the Company Benefit Plans set forth on Schedule 4.15(a)
and the Insurance Contracts set forth on Schedule 4.17):

 

(i) all bonds, debentures, notes, loans, credit or loan Contracts or loan
commitments, mortgages, indentures, guarantees or other Contracts relating to
the borrowing of money or binding upon any properties or assets (real, personal
or mixed, tangible or intangible) of the Seller;

 

(ii) all leases relating to the Leased Real Property or other leases or licenses
involving any properties or assets (whether real, personal or mixed, tangible or
intangible);

 

(iii) all Contracts that (A) limit or restrict the Seller or any of its
officers, directors, stockholders, employees or other equity holders, agents or
representatives (in their capacity as such) from engaging in any business or
other activity in any jurisdiction; (B) create or purport to create any
exclusive or preferential relationship or arrangement; (C) otherwise restrict or
limit the ability of the Seller to operate or expand the Business; (D) limit the
freedom of the Seller to solicit, hire or employ any Person; (E) contain a “most
favored nation” provision; or (F) impose, or purport to impose, any obligations
or restrictions on Affiliates of the Seller;

 

(iv) all confidentiality Contracts, other than those entered into in the
Ordinary Course;

 

(v) all Contracts for capital expenditures or the acquisition or construction of
fixed assets requiring the payment by the Seller of an amount in excess of
$10,000;

 

(vi) all Contracts that provide for an increased payment or benefit, or
accelerated vesting, upon the execution of this Agreement, or the Closing, or in
connection with the transactions contemplated hereby;

 

(vii) all Contracts granting any Person a Lien on all or any part of any asset;

 

(viii) all Contracts granting to any Person an option or a first refusal,
first-offer or similar preferential right to purchase or acquire any assets;

 

(ix) all Contracts with any agent, distributor or representative that are not
terminable without penalty on 30 days’ or less notice;

 

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(x) all Contracts for the granting or receiving of a license, sublicense or
franchise or under which any Person is obligated to pay or has the right to
receive a royalty, license fee, franchise fee or similar payment;

 

(xi) all Contracts to which the Seller is a party (A) with respect to Company
Intellectual Property licensed or transferred to any third party, (B) pursuant
to which a third party has licensed or transferred any Company Intellectual
Property to the Seller (excluding any shrink-wrap or click-wrap license for a
Software program that is generally available from a commercial source for an
annual license or royalty fee of less than $5,000 in the aggregate) or (C)
pursuant to which use, commercial exploitation, assignability or enforcement of
any Company Intellectual Property owned by the Seller is limited, restricted or
prohibited, including territorial restrictions, field of use limitations,
covenants not to sue and non-competition restrictions;

 

(xii) all Contracts providing for the indemnification or holding harmless of any
officer, director, employee or other Person, other than in the Ordinary Course;

 

(xiii) all joint venture or partnership Contracts and all other Contracts
providing for the sharing of any revenue or profits;

 

(xiv) all Contracts entered into involving the sale or purchase of assets,
capital stock or other equity interest of any Person, other than in the Ordinary
Course, or a merger, consolidation, business combination or similar transaction;

 

(xv) all customer Contracts (excluding work orders and purchase orders
individually providing revenue to the Seller of an amount less than $10,000) for
the provision of goods or services by the Seller; (these sales contracts are
with General Surgical; provided that Parent and Seller are hereby assigning and
releasing such Contracts to the Purchaser hereunder );

 

(xvi) all supply Contracts (excluding work orders and purchase orders
individually requiring the Seller to spend an amount less than $10,000) for the
provision of goods or services for the Seller; and

 

(xvii) all existing Contracts (other than those described in subsections (i)
through (xviii) of this Section 4.12) (A) involving an annual commitment or
annual payment to or from the Seller of more than $10,000 individually or (B)
that is material to the Seller, individually or in the aggregate.

 

(b) Correct and complete copies of all Company Contracts have been made
available to the Purchaser. The Company Contracts are legal, valid, binding and
enforceable in accordance with their respective terms with respect to the Seller
and each other party to such Company Contracts. There is no existing default or
breach of the Seller under any Company Contract (or event or condition that,
with notice or lapse of time or both, could constitute a default or breach) and,
to the Knowledge of the Seller, there is no such default (or event or condition
that, with notice or lapse of time or both, could constitute a default or
breach) with respect to any third party to any Company Contract. The Seller is
not participating in any discussions or negotiations regarding modification of
or amendment to any Company Contract or entry in any new Contract applicable to
the Seller or the real or personal property of the Seller that would be a
Company Contract, other than in the Ordinary Course. Schedule 4.12(a) identifies
with an asterisk each Company Contract set forth therein that requires the
consent of or notice to the other party thereto to avoid any breach, default or
violation of such Contract or other instrument in connection with the
transactions contemplated hereby.

 

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Section 4.13 Tax Returns; Taxes.

 

(a) Except as otherwise disclosed on Schedule 4.13(a): (i) all Tax Returns of
the Seller required to have been filed in accordance with any applicable Law
have been duly filed and are correct and complete in all material respects; (ii)
all Taxes, deposits of Taxes or other payments relating to Taxes due and owing
by the Seller (whether or not shown on any Tax Return) have been paid in full;
(iii) there are not now any extensions of time in effect with respect to the
dates on which any Tax Returns of the Seller were or are due to be filed; (iv)
all deficiencies asserted as a result of any examination of any Tax Returns of
the Seller have been paid in full, accrued on the books of the Seller or finally
settled, and no issue has been raised in any such examination which, by
application of the same or similar principles, reasonably could be expected to
result in a proposed deficiency for any other period not so examined; (v) no
claims have been asserted and no proposals or deficiencies for any Taxes of the
Seller are being asserted, proposed or, to the Knowledge of the Seller,
threatened, and no audit or investigation of any Tax Return of the Seller is
currently underway, pending or, to the Knowledge of the Seller, threatened; (vi)
no claim has ever been made by a Taxing authority in a jurisdiction in which the
Seller does not file Tax Returns that it is or may be subject to taxation by
that jurisdiction; (vii) the Seller has withheld and paid all Taxes required to
have been withheld and paid in connection with amounts paid or owing to any
employee, independent contractor, creditor, equity holder or other third party;
(viii) there are no outstanding waivers or Contracts by or on behalf of the
Seller for the extension of time for the assessment of any Taxes or deficiency
thereof, nor are there any requests for rulings, outstanding subpoenas or
requests for information, notice of proposed reassessment of any property owned
or leased by the Seller or any other matter pending between the Seller and any
Taxing authority; and (ix) there are no Liens against any property of the Seller
for Taxes (other than Liens for Taxes which are not yet due and payable), nor
are there any Liens for Taxes which are pending or, to the Knowledge of the
Seller, threatened.

 

(b) The Seller has made available to the Purchaser correct and complete copies
of all Tax Returns (together with any examination or audit work papers) relating
to its respective operations for taxable periods ended on or after its
inception.

 

(c) The Seller has at all times since the date it was organized been classified
as a corporation for federal and applicable state and local income Tax purposes.

 

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Section 4.14 Officers and Employees. Schedule 4.14 contains a correct and
complete list of (a) all of the officers of the Seller, specifying their
position, annual rate of compensation, work location, length of service, and
other benefits provided to each of them, respectively and (b) all of the
employees (whether full-time, part-time or otherwise) and independent
contractors of the Seller as of the date of this Agreement, specifying their
position, status, annual salary, hourly wages, work location, length of service,
other benefits provided to each of them, respectively, consulting or other
independent contractor fees, together with an appropriate notation next to the
name of any officer or other employee on such list who is subject to any written
Employment Agreement or any other written term sheet or other document
describing the terms or conditions of employment of such employee or independent
contractor or of the rendering of services by such independent contractor.
Except as set forth on Schedule 4.14, the Seller is not a party to or bound by
any Employment Agreement. The Seller has made available to the Purchaser correct
and complete copies of each Employment Agreement to which the Seller is a party,
or by which any of them is otherwise bound. Each such Employment Agreement is
legal, valid, binding and enforceable in accordance with its respective terms
with respect to the Seller. There is no existing default or breach of the Seller
under any Employment Agreement (or event or condition that, with notice or lapse
of time or both could constitute a default or breach) and there is no such
default (or event or condition that, with notice or lapse of time or both, could
constitute a default or breach) with respect to any third party to any
Employment Agreement. The Seller has not misclassified any individual as (i) an
independent contractor or employee leased from another employer, rather than as
an employee, or (ii) an employee exempt from state, federal, provincial or other
applicable overtime regulations. All officers and employees of the Seller are
active as of the date of this Agreement. Neither the Seller nor any Controlling
Stockholder has made any verbal commitments to any officer, employee, former
employee, consultant or independent contractor of the Seller with respect to
compensation, promotion, retention, termination, severance or similar matters in
connection with the transactions contemplated hereby or otherwise. To the
Knowledge of the Seller, no employee or independent contractor has notified the
Seller that such employee or independent contractor intends to resign or retire
as a result of the transactions contemplated by this Agreement or otherwise
within one year after the Closing Date.

 

Section 4.15 Company Benefit Plans.

 

(a) Set forth on Schedule 4.15(a) is a list of each Company Benefit Plan. With
respect to each Company Benefit Plan, the Seller has made available to the
Purchaser correct and complete copies of each of the following: (i) the plan
document, together with all amendments, or if unwritten, a written summary of
all material plan terms; (ii) where applicable, any trust Contracts, insurance
policies and other documents establishing other funding arrangements; (iii) any
summary plan descriptions and employee handbooks; (iv) in the case of any
Company Benefit Plan that is intended to be qualified under Section 401(a) of
the Code, a copy of the most recent determination (or opinion) letter, if any,
from the Internal Revenue Service (the “IRS”); (v) all filings required to be
made with any Governmental Entity during the two calendar years preceding the
date of this Agreement; (vi) the two most recent financial statements and
actuarial valuation reports thereof; and (vii) any materials relating to any
government investigation or audit or any submission under any voluntary
compliance procedures.

 

(b) Neither the Seller nor any ERISA Affiliate has ever maintained or been
required to contribute to any benefit plan subject to Title IV of ERISA, or
subject to Section 412 of the Code or Section 302 of ERISA. Neither the Seller
nor any ERISA Affiliate has ever has been required to contribute to any
“multiemployer plan” as defined in Section 4001(a)(3) of ERISA. No liability
under Title IV of ERISA has been or is expected to be incurred by the Seller.

 

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(c) Each Company Benefit Plan, including any associated trust or fund, has been
administered in compliance in all material respects with its terms and the
applicable requirements of ERISA, the Code and any other applicable Laws. Each
Company Benefit Plan that is intended to be qualified under Section 401(a) of
the Code has received a favorable determination letter or is the subject of a
favorable opinion letter from the IRS on the form of such Company Benefit Plan,
and, to the Knowledge of the Seller, no event has occurred and no facts or
circumstances exist that would cause the IRS to revoke or fail to issue such
letter. The Seller has not filed, and is not considering filing, an application
under the IRS Employee Plans Compliance Resolution System or the Department of
Labor’s Voluntary Fiduciary Correction Program with respect to any Company
Benefit Plan.

 

(d) None of the Seller, nor, to the Knowledge of the Seller, any other
“disqualified person” or “party in interest” (as defined in Section 4975(e)(2)
of the Code and Section 3(14) of ERISA, respectively) has engaged in any
transaction with respect to any Employee Benefit Plan that would be reasonably
likely to subject the Seller to any Taxes or penalty (civil or otherwise)
imposed by ERISA, the Code or other applicable Law.

 

(e) All contributions, assessments and premium payments required to be made on
account of each Company Benefit Plan have either been made or accrued on the
financial statements of the Seller, and the Seller has timely deposited all
amounts withheld from employees into appropriate trusts or accounts, and no
event has occurred or condition exists that would reasonably be expected to
result in a material increase in the level of such amounts paid or accrued for
the most recently ended fiscal year. There are no existing or, to the Knowledge
of the Seller, threatened Legal Disputes relating to a Company Benefit Plan,
other than routine claims for information or benefits in the Ordinary Course
and, to the Knowledge of the Seller, there is no reasonable basis for any such
Legal Disputes (other than such routine claims).

 

(f) Other than as required under Section 601 et seq. of ERISA or Section 4980B
of the Code, no Company Benefit Plan or Non-U.S. Plan provides for
post-employment or retiree health, life insurance and/or other welfare benefits,
and the Seller has not any obligation to provide any such benefits to any
retired or former employees or active employees following such employees’
retirement or termination of service. Each Company Benefit Plan may be amended
or terminated by the Seller without any material liability (except Ordinary
Course administration expenses).

 

(g) Neither the execution and delivery of this Agreement nor the consummation of
the transactions contemplated hereby could (either alone or in conjunction with
any other event) (i) result in, or cause the accelerated vesting, payment,
funding or delivery of, or increase the amount or value of, any payment or
benefit to any employee, officer, director or other service provider of the
Seller under any Company Benefit Plan; (ii) result in any severance, termination
or similar types of payments or benefits; or (iii) result in a requirement to
pay any tax “gross-up” or similar “make-whole” payments to any employee,
director or consultant of the Seller.

 

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(h) Each Company Benefit Plan that constitutes in any part a nonqualified
deferred compensation plan within the meaning of Section 409A of the Code has
been operated and maintained in all material respects in operational and
documentary compliance with Section 409A of the Code and applicable guidance
thereunder.

 

(i) The Seller and each Company Benefit Plan that is a “group health plan” as
defined in Section 733(a)(1) of ERISA (a “Company Health Plan”) (i) is currently
in compliance with the Patient Protection and Affordable Care Act, Pub. L. No.
111-148 (“PPACA”), the Health Care and Education Reconciliation Act of 2010,
Pub. L. No. 111-152 (“HCERA”), and all regulations and guidance issued
thereunder (collectively, with PPACA and HCERA, the “Healthcare Reform Laws”),
and (ii) has been in compliance with all applicable Healthcare Reform Laws since
March 23, 2010. No event has occurred, and no condition or circumstance exists,
that would reasonably be expected to subject the Seller or any Company Health
Plan to penalties or excise taxes under Sections 4980D, 4980H, or 4980I of the
Code or any other provision of the Healthcare Reform Laws. Set forth in Schedule
4.15(a) is a correct and complete list of Company Health Plans that indicates
each plan’s classification in each year since 2010 as a non-grandfathered,
grandfathered, excepted benefit or exempt plan for purposes of compliance with
the Healthcare Reform Laws.

 

Section 4.16 Labor Relations.

 

(a) Except as set forth in Schedule 4.16(a), (i) the Seller is not a party to
any collective bargaining agreement, Contract or legally binding commitment to
any trade union or employee organization or group in respect of or affecting
employees; (ii) the Seller is not currently engaged in any negotiation with any
trade union or employee organization; (iii) the Seller has not engaged in any
unfair labor practice within the meaning of the National Labor Relations Act,
and there is no pending or, to the Knowledge of the Seller, threatened complaint
regarding any alleged unfair labor practices as so defined; (iv) there is no
strike, labor dispute, work slowdown or stoppage pending or, to the Knowledge of
the Seller, threatened against the Seller; (v) there is no grievance or
arbitration proceeding arising out of or under any collective bargaining
agreement which is pending or, to the Knowledge of the Seller, threatened
against the Seller; (vi) the Seller has not experienced any material work
stoppage; (vii) the Seller is not the subject of any union organization effort;
(viii) there are no Legal Disputes pending or, to the Knowledge of the Seller,
threatened against the Seller related to the status of any individual as an
independent contractor or employee; and (ix) the Seller has complied in all
respects with WARN.

 

(b) The Seller is in compliance in all material respects with all applicable
Laws, Contracts, policies, plans and programs relating to employment, employment
practices, wages, hours, collective bargaining, unemployment insurance, worker’s
compensation, equal employment opportunity, age and disability discrimination,
the payment withholding of Taxes and the termination of employment, including
occupational safety and health standards and similar foreign, state or local
Law.

 

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(c) Schedule 4.16(c) contains a correct and complete list of (i) all of the
employees of the Seller, specifying each employee’s job title, date of hire,
location, base salary and other compensation, and classification as exempt or
non-exempt under applicable wage and hour Laws, together with an appropriate
notation next to the name of any employee on such list who is subject to any
Employment Agreement; and (ii) all individuals engaged by the Seller as
independent contractors as of the date of this Agreement and at any time during
the prior 12 months, specifying each individual’s commencement date, location,
and compensation, together with an appropriate notation next to the name of any
individual on such list who is subject to any Employment Agreement. All current
and former employees of the Seller who have been classified as exempt under
applicable wage and hour Laws have been properly classified and treated as such.
All individuals who have provided services to the Seller as independent
contractors have been properly classified as independent contractors, rather
than as employees of the Seller, for purposes of all applicable Laws and
Employee Benefit Plans.

 

(d) All individuals employed by the Seller are lawfully permitted to work in the
U.S. The Seller has not received a notification from the U.S. Department of
Homeland Security, the Social Security Administration or any other Governmental
Entity that the social security number it has for one or more employees does not
match the records of such Governmental Entity. The Seller is and has been in
compliance in all material respects with all applicable Laws regarding
immigration and employment of non-citizen workers, including all Form I-9
requirements and other documentation requirements with respect thereto.

 

Section 4.17 Insurance Policies. Schedule 4.17 sets forth a list of all policies
of insurance maintained, owned or held by the Seller as of the date of this
Agreement (collectively, the “Insurance Contracts”), including the policy limits
or amounts of coverage, deductibles or self-insured retentions, and annual
premiums with respect thereto, correct and complete copies of which have been
made available to the Purchaser. All such Insurance Contracts are valid and
binding in accordance with their terms, are in full force and effect, all
premiums with respect thereto covering all periods up to and including the
Closing Date will have been paid, no notice of cancellation or termination has
been received by the Seller with respect to any such policy and the Insurance
Contracts will continue in effect after the Closing Date. The Seller has not
received written notice that (a) it has breached or defaulted under any of such
Insurance Contracts, or (b) that any event has occurred that would permit
termination, modification, acceleration or repudiation of such Insurance
Contracts. Except as set forth in Schedule 4.17, the Seller is not in default
(including a failure to pay an insurance premium when due) in any material
respect with respect to any Insurance Contract, nor has the Seller failed to
give any notice of any material claim under such Insurance Contract in due and
timely fashion nor has the Seller never been denied or turned down for insurance
coverage. Except as set forth on Schedule 4.17, (i) the Seller has not made any
claim under any such policy during the three-year period prior to the date of
this Agreement with respect to which an insurer has, in a written notice to the
Seller, questioned, denied or disputed or otherwise reserved its rights with
respect to coverage and (ii) no insurer has threatened in writing to cancel any
such policy.

 

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Section 4.18 Environmental, Health and Safety Matters. Except as set forth on
Schedule 4.18:

 

(a) the Seller possess all material Permits and approvals required under, and
each is in compliance in all material respects with, all Environmental Laws, and
the Seller is in compliance in all material respects with all applicable
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules and timetables contained in all Environmental Laws or
contained in any other Law, or any notice or demand letter issued thereunder;

 

(b) the Seller has not entered into or agreed to enter into, and the Seller has
not contemplated entering into, any consent decree or order, and the Seller is
not subject to any judgment, decree or judicial or administrative order relating
to compliance with, or the cleanup of Hazardous Materials under, any applicable
Environmental Law;

 

(c) the Seller has not been alleged to be in violation of, and has not been
subject to any Legal Dispute pursuant to, applicable Environmental Laws either
now or any time since December 31, 2010;

 

(d) the Seller has made available to the Purchaser correct and complete copies
of all reports, correspondence, memoranda, computer data and the correct and
complete files relating to environmental matters of the Seller; and

 

(e) there has not occurred, nor is there presently occurring, a Release of
Hazardous Material on, into or beneath the surface of any Leased Real Property,
in an amount requiring notice or report to a Governmental Entity; and

 

(f) the Seller has not imported, manufactured, stored, managed, used, operated,
transported, treated or disposed of any Hazardous Material other than in
compliance with all Environmental Laws.

 

Section 4.19 Intellectual Property.

 

(a) Schedule 4.19(a) contains a description of the Company Intellectual
Property, which identifies all Company Registered Intellectual Property
(including registration number, application number, patent number, filing date,
issue date, mark or title, and jurisdiction), and identifies that which is owned
and that which is licensed by the Seller.

 

(b) Except as set forth on Schedule 4.19(a), no Company Intellectual Property
owned by the Seller or product or service marketed or sold by the Seller is
subject to any Legal Dispute or outstanding decree, order, judgment, Contract or
stipulation (i) restricting in any manner the use, transfer or licensing thereof
by the Seller or (ii) that may affect the validity, use or enforceability of
such Company Intellectual Property or any such product or service. Each item of
Company Registered Intellectual Property owned by the Seller is valid,
enforceable and subsisting. All necessary registration, maintenance and renewal
fees currently due in connection with Company Registered Intellectual Property
owned by the Seller have been made and all necessary documents, recordations and
certifications in connection with the maintenance, renewal and recordation of
ownership of such Company Registered Intellectual Property have been filed with
the relevant patent, copyright, trademark or other authorities in the U.S. or
foreign jurisdictions.

 

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(c) Except as set forth on Schedule 4.19(a), the Seller owns and has good and
exclusive title to, or has licenses (sufficient for the conduct of the Business
as currently conducted and as proposed to be conducted) to, each item of Company
Intellectual Property, which will continue unaffected by the consummation of the
transactions contemplated in this Agreement, free and clear of any Lien. The
Company Intellectual Property shall be owned by the Purchaser immediately after
the Closing Date. Except as set forth on Schedule 4.19(a), the Seller is the
exclusive owner or exclusive licensee of all trademarks and service marks, trade
names and domain names used by the Seller in connection with the advertisement,
marketing or sale of any products or the provision of any services of the
Seller, free and clear of all Liens. Except as set forth on Schedule 4.19(a),
the Seller has not granted any rights or interest in the Company Intellectual
Property to a third party except for non-exclusive licenses granted to end users
or customers for Company Proprietary Software in object code format. The Company
Intellectual Property includes all of the Intellectual Property necessary and
sufficient for the operation of the Business in the same manner as currently
conducted and as proposed to be conducted.

 

(d) Except as set forth on Schedule 4.19(a), The Seller owns exclusively and has
good title to all copyright works, including Software, of the Seller that (i)
are products of the Seller or used in connection with the provision of services
by the Seller or (ii) the Seller owns or otherwise expressly purports to own,
free and clear of all Liens.

 

(e) Except as set forth on Schedule 4.19(a), each Person who is or was an
employee of the Seller and who is or was involved in the creation or development
of any Company Intellectual Property owned by the Seller, has signed a valid,
enforceable agreement containing an assignment of Intellectual Property rights
pertaining to such created Intellectual Property to the Seller. Except as set
forth on Schedule 4.19(a), to the extent that the Company Intellectual Property
has been developed or created by a third party for the Seller, the Seller has a
written Contract with such third party with respect thereto and the Seller
either (i) has ownership of and is the exclusive owner of, or (ii) has an
irrevocable license (sufficient for the operations of the Seller as currently
conducted and as proposed to be conducted) to, all of such third party’s
Intellectual Property in such work, material or invention by operation of Law or
by valid assignment, to the fullest extent it is legally possible to do so.

 

(f) The operations of the Seller as currently conducted and as proposed to be
conducted, including the Seller’s design, development, marketing and sale of the
products or services of the Seller (including with respect to products or
services currently under development) and the Company Intellectual Property
owned by the Seller, has not, does not and shall not infringe or misappropriate
in any manner the Intellectual Property of any third party or, to the Knowledge
of the Seller, constitute unfair competition or trade practices under the Laws
of any jurisdiction.

 

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(g) The Seller has no Knowledge of, and has not received written notice of or
any other overt threat from any third party, that the operation of the Seller as
it is currently conducted and as proposed to be conducted, or any act, product
or service of the Seller, infringes or misappropriates the Intellectual Property
of any third party or constitutes unfair competition or trade practices under
the Laws of any jurisdiction.

 

(h) To the Knowledge of the Seller, no Person has or is infringing or
misappropriating any Company Intellectual Property.

 

(i) The Seller has taken reasonable steps to protect the rights of the Seller in
the Confidential Information and any trade secret or confidential information of
third parties used by the Seller, and, without limiting the generality of the
foregoing, the Seller has enforced a policy requiring each employee and
contractor to execute a proprietary information/confidentiality Contract in
substantially the form made available to the Purchaser, and, except under
confidentiality obligations, there has not been any disclosure by the Seller of
any Confidential Information or any such trade secret or confidential
information of third parties.

 

(j) Except as set forth on Schedule 4.19(a), the Company Intellectual Property
owned, used or held for use by the Seller immediately prior to completion of the
transactions contemplated by this Agreement shall be owned by the Seller after
the Closing without payment (or incurring an obligation to make any payment) of
fees, royalties or other expenses to a third party or consent of a third party.
Without limiting the foregoing, Parent has no right, title or interest in, and
does not own or control, any Company Intellectual Property.

 

Section 4.20 Software and Computer Systems. 

 

(a) Schedule 4.20 sets forth a correct and complete list of: (i) the Company
Proprietary Software and (ii) the Company Licensed Software, none of which is
material to the Company’s business. The Seller has the right to use the Company
Software, which will continue unaffected by the consummation of the transactions
contemplated in this Agreement, free and clear of all Liens. The relevant data
stored by Company Software up to the Closing Date shall be owned by the
Purchaser immediately after the Closing Date on terms and conditions
substantially similar to those under which the Seller owned or used the relevant
data stored by Company Software immediately prior to the Closing Date, and may
be transferred or downloaded into a file format usable by Purchaser without
expense or delay.

 

(b) Except as set forth on Schedule 4.20, the Seller has all right, title and
interest in and to the Company Proprietary Software, free and clear of all
Liens. Except as set forth on Schedule 4.20, the Seller has developed the
Company Proprietary Software through the efforts of their employees and for
their own account and such Company Proprietary Software does not incorporate any
contributions made by a third party developer, contractor or consultant. The use
of the Company Software does not breach any term of any license or other
Contract between the Seller, on the one hand, and any third party, on the other
hand. The Seller is in compliance with the terms and conditions of all license
Contracts in favor of the Seller relating to the Company Licensed Software.

 

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(c) To the Knowledge of the Company, the Company Proprietary Software does not
infringe or misappropriate any Intellectual Property right of any third party.
The source code for the Company Proprietary Software is and has been maintained
in confidence and is not maintained (or required to be maintained) in a software
escrow for any customer or other Person. The Seller has actual possession of the
source code, system documentation, statements of principles of operation and
schematics, as well as any pertinent commentary, explanation, program (including
compilers), workbenches, tools and higher level language used for the
development, maintenance, implementation and use of the Company Proprietary
Software.

 

(d) The Company Proprietary Software was: (i) developed by the Seller’s
employees working within the scope of their employment at the time of such
development or (ii) developed by agents, consultants, contractors or other
Persons who have executed appropriate instruments of assignment in favor of the
Seller as assignee that have conveyed to the Seller ownership of all of its
Intellectual Property rights in the Company Proprietary Software; or (iii)
acquired by the Seller in connection with acquisitions in which the Seller
obtained appropriate representations, warranties and indemnities from the
transferring party relating to the title to Intellectual Property rights in the
Company Proprietary Software. The Seller has not received notice from any third
party claiming any right, title or interest in the Company Proprietary Software.

 

(e) Except as set forth on Schedule 4.20, the Seller has not granted any rights
in the Company Software to any third party except for non-exclusive licenses
granted in the Ordinary Course to end users or customers for Company Proprietary
Software in object code format.

 

(f) The Company Proprietary Software operates in all material respects in
accordance with and conforms in all material respects to any specification,
manual, guide, description and other similar documentation delivered by the
Seller to customers, end-users, original equipment manufacturers or resellers.

 

(g) Schedule 4.20(g) contains a list and description of all Open Source Software
incorporated, embedded in or used by the Company Proprietary Software or used by
the Seller in any product or in connection with any service, and describes: (i)
the manner in which any Copyleft Software is used; (ii) whether (and, if so,
how) such Copyleft Software has been modified by or for the Seller; (iii)
whether (and, if so, how) such Copyleft Software is distributed (e.g.,
electronically, on disc, with any Company Software, separate from any Company
Software) by or for the Seller or any licensee of the Seller; and (iv) whether
(and if so, how) such Copyleft Software is integrated with, interacts with or
links to (dynamically or statically) other portions of any Company Proprietary
Software. No part of the Company Proprietary Software or any product or service
of the Seller is licensed, distributed or disclosed, or required by the terms of
any Open Source License to be licensed, distributed or disclosed, pursuant to
such Open Source License. The use and distribution of all Open Source Software
by the Seller is in full compliance with all Open Source Licenses applicable
thereto.

 

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(h) The Seller has not experienced any material disruption to, or material
interruption in, the conduct of the Business attributable to a defect, bug,
breakdown, unauthorized access, introduction of a virus or other malicious
programming, or other failure or deficiency on the part of any computer software
or technology used by the Seller. The computer systems, including computer
software, computer hardware, networks, interfaces, servers, storage devices,
data communication services, computer network services, Internet access
services, and cloud-based mass data storage services and related information
technology systems and services, which are owned, licensed, leased or used by
the Seller (collectively, the “Company Systems”) are sufficient for the needs of
the Business as currently conducted and as proposed to be conducted, including
as to capacity, scalability and ability to process current and anticipated peak
volumes in a timely manner. The Seller has purchased a sufficient number of
license seats for all computer software licensed to the Seller by a third party
and used by the Seller the operation of the Business as currently conducted. The
Seller uses commercially reasonable efforts to protect the Company Systems from
becoming infected by viruses and other malicious code. The Seller has taken
commercially reasonable steps to provide for the security, continuity and
integrity of the Company Systems and the back-up and recovery of data and
information stored or contained therein or accessed or processed thereby and to
guard against any unauthorized access or use thereof. There have not been any
unauthorized intrusions or breaches of the security of any of the Company
Systems or any unauthorized access or use of any of the data or information
stored or contained therein or accessed or processed thereby or that has
resulted in the destruction, damage, loss, corruption, alteration or misuse of
any such data or information. The Seller has implemented, tested and maintain
commercially reasonable security, disaster recovery and business continuity
plans, procedures and facilities in connection with the Business as presently
conducted and act in compliance therewith.

 

Section 4.21 Data Privacy. The Seller has complied in all material respects with
all Laws and contractual and fiduciary obligations relating to the protection
and security of personally identifiable information relating to individuals
(collectively, “Personal Data”) to which the Seller is currently or was then
subject. The Seller has not received any written inquiries from or been subject
to any Legal Dispute by any Governmental Entity regarding their compliance with
the foregoing. The Seller has established policies, programs and procedures with
respect to the collection, use, processing, storage and transfer of all Personal
Data in connection with the Business consistent and compliant in all material
respects with applicable Law relating to privacy and data protection. The Seller
has complied in all material respects with all rules, policies and procedures
established by the Seller from time to time with respect to privacy, publicity,
data protection or collection and use of personal information and user
information gathered or accessed in the course of the operations of the Seller.
No Legal Dispute alleging (a) a material violation of any Person’s privacy,
personal or confidentiality rights under any such rules, policies or procedures
or (b) any breach, misappropriation, or unauthorized disclosure, access, use or
dissemination of any Personal Data has been asserted or, to the Knowledge of the
Seller, threatened against the Seller by any Person. There has not been (i) a
material violation of any Person’s privacy, personal or confidentiality rights
under any such rules, policies or procedures or (ii) any material breach,
material misappropriation, or material unauthorized disclosure, access, use or
dissemination of any Personal Data. The Seller has at all times taken all steps
reasonably necessary (including implementing and monitoring compliance with
adequate measures with respect to technical and physical security) to reasonably
ensure that any Personal Data collected by the Seller is protected against loss
and against unauthorized access, use, modification, disclosure or other misuse.

 

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Section 4.22 Transactions with Affiliates. Except as set forth on Schedule 4.22,
no employee, officer, director, stockholder, Affiliate of the Seller, direct or
indirect equityholder of the Seller or any individual in such officer’s,
director’s or stockholder’s or Affiliate’s immediate family (collectively, the
“Seller Affiliates”) is a party to any material Contract, commitment or
transaction with the Seller or has any interest in any Contract or property used
by the Seller (collectively, the “Related Party Agreements”). To the Seller’s
Knowledge, except as set forth on Schedule 4.22, neither the Seller nor any of
its Affiliates, employees, officers or directors possesses, directly or
indirectly, any financial interest in, or is an employee, officer or director
of, any Person that is a material client, supplier, customer, lessor, lessee, or
competitor of the Seller. All intercompany balances, notes receivable and notes
payable (the “Affiliate Loans”) of the Seller by or to any of Seller Affiliates
shall not result in any liability to Purchaser and shall not be Assumed
Liabilities hereunder. Schedule 4.22 sets forth a correct and complete list of
all Affiliate Loans and the outstanding balance and applicable interest payments
under each Affiliate Loan as of the date of this Agreement.

 

Section 4.23 Customer and Supplier Relations. Schedule 4.23 contains a correct
and complete list of the names and addresses of the Customers and Suppliers of
the Seller, and the amount of sales to or purchases from each such Customer or
Supplier during the 12-month period ended December 31, 2017. The Seller
maintains good relations with each of the Customers and Suppliers and, to the
Knowledge of the Seller, no event has occurred that could materially and
adversely affect the Seller’s relations with any Customer or Supplier. Except as
set forth on Schedule 4.23, no Customer or Supplier has during the last 12
months cancelled, terminated or, to the Knowledge of the Seller, made any threat
to cancel or otherwise terminate any of its Contracts with the Seller or to
decrease its usage or supply of the Seller’s services or products of the
Business. The Seller has no Knowledge to the effect that any current Customer or
Supplier may terminate or materially alter its business relations with the
Seller, either as a result of the transactions contemplated hereby or otherwise.

 

Section 4.24 Notes and Accounts Receivable.

 

(a) Notes. All notes receivable and notes payable of the Seller owing by or to
any director, officer, employee or Affiliate of the Seller or by or to any
Controlling Stockholder have been paid in full, settled by way of capital
contribution in kind, cancelled or otherwise discharged prior to the date of
this Agreement.

 

(b) Accounts Receivable. Except as set forth on Schedule 4.24(b), all
receivables reflected on the Balance Sheet (net of any reserves shown thereon)
(i) are and will be valid, existing and collectible in a manner consistent with
the Seller’s past practice without resort to Legal Disputes or collection
agencies, (ii) represent monies due for goods sold and delivered or services
rendered in the Ordinary Course and (iii) are not and will not be subject to any
refund or adjustment or any defense, right of set-off, assignment, restriction,
security interest or other Lien. The Seller has not factored any of its
receivables.

 

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(c) Accounts Payable. The accounts payable of the Seller reflected on Schedule
2.4(b)(ii) arose or will arise from bona fide transactions in the Ordinary
Course.

 

Section 4.25 Licenses. Schedule 4.25 is a correct and complete list of all
Licenses held by the Seller. The Seller possesses and is in compliance in all
material respects with all Licenses required to conduct the Business as now
being conducted and as proposed to be conducted. All such Licenses are valid,
binding and in full force and effect. The Seller is not in default under, and no
condition exists that, with notice or lapse of time or both, would constitute a
default under, any such License. The execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby shall not
adversely affect any such License, or require consent from, or notice to, any
Governmental Entity. The Seller has taken all necessary action to maintain each
License. No loss or expiration of any License is pending or, to the Knowledge of
the Seller, threatened (other than expiration upon the end of any term).

 

Section 4.26 Product and Service Warranties and Guaranties. Except as set forth
on Schedule 4.26, the Seller does not make any express warranty or guaranty as
to goods sold, or services provided by, the Seller (a “Warranty”), and there is
no pending or, to the Knowledge of the Seller, threatened claim alleging any
breach of any Warranty. Except as set forth on Schedule 4.26 (attached to which
are copies of all Warranties), the Seller does not have any exposure to, or
liability under, any Warranty (i) beyond that which is typically assumed in the
ordinary course of business by Persons engaged in businesses comparable in size
and scope of the Seller, or (ii) that would have a material adverse effect on
the Seller or its operations.

 

Section 4.27 Brokers, Finders and Investment Bankers. Except as set forth on
Schedule 4.27, neither the Seller nor any Controlling Stockholder, nor any
officer, stockholder, director or employee of the Seller nor any Affiliate of
the Seller, has employed any broker, finder or investment banker or incurred any
liability for any investment banking fees, financial advisory fees, brokerage
fees or finders’ fees in connection with the transactions contemplated hereby.
The Controlling Stockholders are solely responsible for the fees and expenses of
any broker set forth on Schedule 4.27.

 

Section 4.28 FDA Regulatory Matters.

 

(a) Except as set forth on Schedule 4.28(a), the Seller is in compliance with
all applicable Laws, statutes (including the Federal Food, Drug, and Cosmetic
Act, 21 U.S.C. §321 et. seq.), rules, regulations, mandatory standards, and
orders administered or issued by the U.S. Food and Drug Administration (the
“FDA”) or any applicable, comparable foreign governmental regulatory authority,
including requirements related to premarket clearance, exemption from premarket
clearance, premarket approval, establishment registration and product listing,
medical device reporting, corrections and removals, import and export
requirements, product labeling, promotional materials and advertising,
qualification, purchasing, controls, product testing, and good manufacturing
practices, except for such noncompliance that would not, individually or in the
aggregate, require payment by or a loss to the Seller of more than $10,000.

 

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(b) The Seller has not been charged with, nor received any written notice or
other written communication from the FDA or any comparable Governmental Entity
alleging, any violation of any Laws by the Seller relating to the Business. The
Seller is not the subject of any investigation that is pending or, to the
Knowledge of the Seller, proposed or threatened by the FDA or any comparable
Governmental Entity. The Seller is not subject to any obligation arising under
any judicial, administrative, or regulatory action, FDA inspection, FDA warning
letter, FDA untitled letter, FDA notice of violation letter or other written
communication from the FDA or a comparable Governmental Entity or other written
notice, response, or commitment made to or with the FDA or a comparable
Governmental Entity. The Seller has not received any information regarding, nor
has Knowledge of, any facts or circumstances that furnish any reasonable basis
for any Form FDA-483 inspectional observations, untitled letter, notice of
violation letter, warning letter, or similar communication from the FDA, or any
comparable Governmental Entity.

 

(c) No seizure, denial, withdrawal, recall, detention, field notification, field
correction, termination or suspension of manufacturing or marketing, import
alert, or safety alert relating to any product manufactured or distributed by
the Seller (the “Products”) has been initiated, proposed, requested, or
threatened. The Seller has not received any information regarding, nor has any
Knowledge of, any facts or circumstances reasonably likely to cause any such
action.

 

(d) Each filing, submission or other communication to the FDA or any comparable
Governmental Entity in any other jurisdiction made by the Seller was correct and
complete in all material respects as of the date hereof. The Seller has notified
the FDA and all such Governmental Entities of any changes to such filing or
submissions as required by Law.

 

(e) The Seller possesses all certificates, authorizations, permits,
registrations, clearances, approvals, and licenses issued, and exemptions
(including 510(k) premarket notification and investigational device exemptions)
authorized by the FDA and comparable foreign Governmental Entities necessary to
conduct the Business, including to research, develop, manufacture, process,
produce, sell, market, distribute, and transport its products (“FDA Permits”).
The Seller does not import or export any products. The Seller has fulfilled all
material obligations under each FDA Permit, and no event has occurred that would
reasonably be expected to constitute a violation or to cause revocation or
termination of any such FDA Permit. To the Knowledge of the Seller, neither the
FDA nor any other comparable Governmental Entity is considering limiting,
suspending or revoking any such FDA Permit or changing the regulatory
classification or labeling of any Product. Except as set forth on Schedule
4.28(e), to the Knowledge of the Seller, any third party that is a supplier,
manufacturer, or contractor for the Seller is in material compliance with all
applicable Laws administered or issued by the FDA or comparable Governmental
Entities to the extent they pertain to the manufacture of the Products or
product components for the Seller.

 

(f) There has not been any accident, occurrence or event that is caused by any
hazard or defect in manufacture, design, materials or workmanship including any
failure or alleged failure to warn or any breach or alleged breach of express or
implied warranties or representations with respect to a product manufactured,
shipped, sold or delivered by or on behalf of the Seller or any of its
Affiliates which resulted in significant injury or death to any Person or
significant damage to any property.

 

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Section 4.29 Ethical Practices. Neither the Seller nor any representative
thereof has offered or given, and the Seller has no Knowledge of any Person that
has offered or given on its behalf, anything of value to: (a) any official of a
Governmental Entity, any political party or official thereof or any candidate
for political office; (b) any customer or member of any Governmental Entity; or
(c) any other Person, in any such case while knowing or having reason to know
that all or a portion of such money or thing of value may be offered, given or
promised, directly or indirectly, to any customer or member of any Governmental
Entity or any candidate for political office for the purpose of the following:
(i) influencing any action or decision of such Person, in such Person’s official
capacity, including a decision to fail to perform such Person’s official
function; (ii) inducing such Person to use such Person’s influence with any
Governmental Entity to affect or influence any act or decision of such
Governmental Entity to assist the Seller in obtaining or retaining business for,
with, or directing business to, any Person; or (iii) where such payment would
constitute a bribe, kickback or illegal or improper payment to assist the Seller
in obtaining or retaining business for, with, or directing business to, any
Person.

 

Section 4.30 Undisclosed Payments. Neither the Seller nor any of its officers,
stockholders or directors, nor anyone acting on behalf of any of them, has made
or received any payment not correctly categorized and fully disclosed in the
Seller’s books and records in connection with or in any way relating to or
affecting the Seller.

 

Section 4.31 Disclosure. No representation or warranty by the Seller, the
Parent, General Surgical or any Controlling Stockholder in this Agreement, and
no statement in the Schedules or any other document, certificate or other
instrument delivered or to be delivered by or on behalf of the Seller, the
Parent, General Surgical or any Controlling Stockholder pursuant to this
Agreement or as part of the Seller, the Parent, General Surgical or any
Controlling Stockholder’s diligence production contains or will contain any
untrue statement of a material fact or omits or will omit to state any material
fact necessary, in light of the circumstances under which it was or will be
made, in order to make the statements in this Agreement or therein not
misleading.

 

Article V
REPRESENTATIONS AND WARRANTIES RELATING TO THE PARENT AND GENERAL SURGICAL

 

The Seller, the Parent, General Surgical and the Controlling Stockholders
hereby, jointly and severally, represent and warrant to the Purchaser as
follows:

 

Section 5.1 Authorization. Each of the Parent and General Surgical
(collectively, the “Parent Parties”) has the right, power, authority and
capacity to execute and deliver this Agreement and each Owner Ancillary Document
and to perform its obligations hereunder and thereunder and to consummate the
transactions contemplated hereby and thereby. The execution, delivery and
performance of this Agreement and the Owner Ancillary Documents by each of the
Parent Parties and the consummation of the transactions contemplated hereby and
thereby have been duly authorized by all required action on the part of each of
the Parent Parties. This Agreement has been, and the Owner Ancillary Documents
shall be as of the Closing Date, duly executed and delivered by each of the
Parent Parties, and do or shall, as the case may be, constitute the valid and
binding agreement of each of the Parent Parties enforceable against each of the
Parent Parties in accordance with their respective terms, subject to applicable
bankruptcy, insolvency and other similar Laws affecting the enforceability of
creditors’ rights generally, general equitable principles and the discretion of
courts in granting equitable remedies.

 

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Section 5.2 Absence of Restrictions and Conflicts. The execution, delivery and
performance of this Agreement and the Owner Ancillary Documents, the
consummation of the transactions contemplated hereby and thereby and the
fulfillment of and compliance with the terms and conditions of this Agreement
and thereof do not or shall not, as the case may be, with the passing of time or
the giving of notice or both, violate or conflict with, constitute a breach of
or default under, result in the loss of any benefit under, permit the
acceleration of any obligation under or create in any party the right to
terminate, modify or cancel (a) any Contract, permit, franchise, license or
other instrument applicable to any of the Parent Parties, (b) any judgment,
decree or order of any Governmental Entity to which any of the Parent Parties is
a party or by which any of the Parent Parties or any of its properties are
bound, or (c) any Law or arbitration award applicable to any of the Parent
Parties.

 

Section 5.3 Ownership of Equity.

 

(a) The Parent has good and valid title to and beneficial ownership of the
number of shares of capital stock of the Seller set forth next to the Parent’s
name on Schedule 4.3(a), and such shares are (i) validly issued, fully paid, and
nonassessable, and (ii) free and clear of all Liens.

 

(b) Other than the shares of capital stock listed on Schedule 4.3(a), the Parent
owns no shares of capital stock or any other equity security of the Seller, or
any option, warrant, right, call, commitment or right of any kind to have any
such equity security issued.

 

Section 5.4 Legal Disputes. There is no Legal Dispute pending or, to the
knowledge of any of the Parent Parties, threatened against, relating to or
involving any of the Parent Parties or its real or personal property that could
reasonably be expected to adversely affect any of the Parent Parties’ ability to
consummate the transactions contemplated by this Agreement.

 

Article VI
INDIVIDUAL REPRESENTATIONS AND
WARRANTIES of EACH OF THE CONTROLLING STOCKHOLDERS

 

Each of the Controlling Stockholders, severally and not jointly, represents and
warrants to the Purchaser as follows:

 

Section 6.1 Authorization. Such Controlling Stockholder has the right, power,
authority and capacity to execute in their individual capacity and deliver this
Agreement and each Owner Ancillary Document and to perform its obligations
hereunder and thereunder and to consummate the transactions contemplated hereby
and thereby. The execution, delivery and performance of this Agreement and the
Owner Ancillary Documents by such Controlling Stockholder and the consummation
of the transactions contemplated hereby and thereby have been duly authorized by
all required action on the part of such Controlling Stockholder. This Agreement
has been, and the Owner Ancillary Documents shall be as of the Closing Date,
duly executed and delivered by such Controlling Stockholder, and do or shall, as
the case may be, constitute the valid and binding agreement of such Controlling
Stockholder enforceable against such Controlling Stockholder in accordance with
their respective terms, subject to applicable bankruptcy, insolvency and other
similar Laws affecting the enforceability of creditors’ rights generally,
general equitable principles and the discretion of courts in granting equitable
remedies.

 

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Section 6.2 Absence of Restrictions and Conflicts. The execution, delivery and
performance of this Agreement and the Owner Ancillary Documents, the
consummation of the transactions contemplated hereby and thereby and the
fulfillment of and compliance with the terms and conditions of this Agreement
and thereof do not or shall not, as the case may be, with the passing of time or
the giving of notice or both, violate or conflict with, constitute a breach of
or default under, result in the loss of any benefit under, permit the
acceleration of any obligation under or create in any party the right to
terminate, modify or cancel (a) any Contract, permit, franchise, license or
other instrument applicable to such Controlling Stockholder, (b) any judgment,
decree or order of any Governmental Entity to which such Controlling Stockholder
is a party or by which such Controlling Stockholder or any of its properties are
bound, or (c) any Law or arbitration award applicable to such Controlling
Stockholder.

 

Section 6.3 Ownership of Equity.

 

(a) Such Controlling Stockholder has good and valid title to and beneficial
ownership of the number of shares of Series A Non-Convertible Preferred Stock of
the Parent set forth next to such Controlling Stockholder’s name on Schedule
4.3(a), and such shares are (i) validly issued, fully paid, and nonassessable,
and (ii) free and clear of all Liens.

 

(b) No Controlling Stockholder owns no shares of capital stock or any other
equity security of the Seller, or any option, warrant, right, call, commitment
or right of any kind to have any such equity security issued.

 

Section 6.4 Legal Disputes. There is no Legal Dispute pending or, to the
knowledge of such Controlling Stockholder, threatened against, relating to or
involving such Controlling Stockholder or its real or personal property that
could reasonably be expected to adversely affect such Controlling Stockholder’s
ability to consummate the transactions contemplated by this Agreement.

 

Section 6.5 Amounts Owed to Controlling Stockholders. The Seller does not owe
and is not obligated to pay such Controlling Stockholder any amount, except for
salary, employee benefits and bonuses, accrued prior to the Closing in the
Ordinary Course.

 

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Article VII
REPRESENTATIONS AND WARRANTIES OF THE PURCHASER

 

The Purchaser hereby represents and warrants to the Seller, the Parent, General
Surgical and the Controlling Stockholders as follows:

 

Section 7.1 Organization. The Purchaser is a limited liability company duly
organized, validly existing and in good standing under the Laws of the State of
Utah and has all requisite power and authority to own, lease and operate its
properties and to carry on its business as now being conducted.

 

Section 7.2 Authorization. The Purchaser has full power and authority to execute
and deliver this Agreement and the Purchaser Ancillary Documents, to perform its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement
and the Purchaser Ancillary Documents by the Purchaser, the performance by the
Purchaser of its obligations hereunder and thereunder, and the consummation of
the transactions provided for herein and therein have been duly and validly
authorized by all necessary action on the part of the Purchaser. This Agreement
has been and, as of the Closing Date, the Purchaser Ancillary Documents shall
be, duly executed and delivered by the Purchaser and do or shall, as the case
may be, constitute the valid and binding agreements of the Purchaser,
enforceable against the Purchaser in accordance with their respective terms,
subject to applicable bankruptcy, insolvency and other similar Laws affecting
the enforceability of creditors’ rights generally, general equitable principles
and the discretion of courts in granting equitable remedies.

 

Section 7.3 Absence of Restrictions and Conflicts. The execution, delivery and
performance of this Agreement and the Purchaser Ancillary Documents, the
consummation of the transactions contemplated hereby and thereby and the
fulfillment of, and compliance with, the terms and conditions of this Agreement
and thereof do not or shall not (as the case may be), with the passing of time
or the giving of notice or both, violate or conflict with, constitute a breach
of or default under, result in the loss of any benefit under, or permit the
acceleration of any obligation under, (a) any term or provision of the
organizational documents of the Purchaser, (b) any Contract to which the
Purchaser is a party, (c) any judgment, decree or order of any Governmental
Entity to which the Purchaser is a party or by which the Purchaser or any of its
properties is bound or (d) any Law applicable to the Purchaser unless, in each
case, such violation, conflict, breach, default, loss of benefit or accelerated
obligation would not, either individually or in the aggregate, have a material
adverse impact on the ability of the Purchaser to consummate the transactions
contemplated hereby, or by the Purchaser Ancillary Documents.

 

Section 7.4 Legal Disputes. There is no Legal Dispute pending or, to the
knowledge of the Purchaser, threatened against, relating to or involving the
Purchaser or its real or personal property that would not, either individually
or in the aggregate, have a material adverse impact on the ability of the
Purchaser to consummate the transactions contemplated hereby, or by the
Purchaser Ancillary Documents.

 

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Article VIII
CERTAIN COVENANTS AND AGREEMENTS

 

Section 8.1 Public Announcements. Following the date of this Agreement, the
Purchaser may issue such press releases or public announcements, and make such
other public disclosures related to this Agreement or the transactions
contemplated hereby as it determines are required or deems appropriate, provided
that the Seller and/or Parent reasonably approves the form and content of such
disclosure. Purchaser is aware that Parent (including General Surgical and
Seller) are subject to the reporting requirements of the Securities and Exchange
Commission (the “SEC”) and therefore, any disclosure must take this into account
so that Parent may make timely disclosure as required under the Securities
Exchange Act of 1934, as amended, and regulation promulgated by the SEC. None of
the Seller, the Parent, General Surgical or the Controlling Stockholders will
issue or make any report, statement or release to the public (including
employees, customers and suppliers of the Seller) with respect to this Agreement
or the transactions contemplated hereby without the consent of the Purchaser,
which consent shall not be unreasonably withheld or delayed. Seller or its
affiliates shall not be bound by any restrictions in making any disclosure
required by law.

 

Section 8.2 Company Benefit Plans.

 

(a) Prior to the date of this Agreement, the Seller shall have made all required
contributions and paid all premiums required under each Company Benefit Plan,
including any employer matching and profit sharing contributions, which are due
on or before the Closing Date.

 

(b) On or prior to the date of this Agreement, with respect to all of the
Seller’s employees, the Seller shall contribute all contributions to any Company
Benefit Plan which is intended to meet the requirements of Section 401(k) of the
Code, and which is sponsored, or contributed to, by the Seller (each, a “Seller
401(k) Plan”) (i) which are required to be made on or before the Closing Date
under such Seller 401(k) Plan, and (ii) which relate to service or employee
salary deferral contributions on or prior to the Closing Date, whether or not
required to be made on or prior to the Closing Date under such Seller 401(k)
Plan.

 

(c) Except as specifically set forth in this Agreement: (i) the Purchaser shall
not be obligated to assume, continue or maintain any of the Company Benefit
Plans, (ii) except as set forth in Section 8.7(g), no assets or liabilities of
the Company Benefit Plans shall be transferred to, or assumed by, the Purchaser
or the Purchaser’s benefit plans, and (iii) except as set forth in Section
8.7(g), the Seller shall be solely responsible for funding or paying any
benefits under any of the Company Benefit Plans, including any termination
benefits and other employee entitlements accrued under such plans by or
attributable to employees of the Seller and any of its ERISA Affiliates.

 

(d) The Seller shall be responsible for administering the Company Benefit Plans
following the Closing Date and shall designate a person to whom the Transferred
Employees may direct any questions about benefits due to them under the Company
Benefit Plans after the Closing.

 

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(e) Nothing in this Agreement, express or implied, shall: (i) confer upon any
employee of the Seller, or any representative of any such employee, any rights
or remedies, including any right to employment or continued employment for any
period or terms of employment, for any nature whatsoever, or (ii) be interpreted
to prevent or restrict the Purchaser from modifying or terminating the
employment or terms of employment of any Transferred Employee, including the
amendment or termination of any Company Benefit Plan, employee benefit or
compensation plan, program or arrangement, after the Closing Date.

 

Section 8.3 Insurance. If requested by the Purchaser, the Seller shall in good
faith reasonably cooperate with the Purchaser to work with Seller’s current
insurance broker in Purchaser’s efforts to obtain, following the Closing, the
benefits (whether direct or indirect) of the insurance policies maintained by or
on behalf of the Seller that are currently in force. All costs relating to the
actions described in this Section 8.3 shall be borne by the Purchaser.

 

Section 8.4 Confidential Information. Each of the Seller, the Parent, General
Surgical and the Controlling Stockholders shall hold in confidence at all times
following the date of this Agreement all Confidential Information and shall not
disclose, publish or make use of such Confidential Information at any time
following the date of this Agreement without the prior written consent of the
Purchaser.

 

Section 8.5 Certain Tax Matters.

 

(a) All transfer, documentary, sales, use, stamp, value-added, registration and
other such Taxes and fees (“Transfer Taxes”), including any penalties and
interest, incurred in connection with this Agreement shall be paid by the Seller
when due. The Seller will, at its own expense, file all necessary Tax Returns
and other documentation with respect to all such Transfer Taxes, and, if
required by applicable Law, the Purchaser will, and will cause its Affiliates
to, join in the execution of any such Tax Returns and other documentation.

 

(b) The Parties agree (i) that for U.S. federal and all applicable state and
local income Tax purposes, any liability that is assumed by the Purchaser in
connection with the transactions contemplated by this Agreement and that is
attributable to deferred revenue shall not be treated as giving rise to taxable
income of the Purchaser and (ii) not to take any position on any Tax Return that
is inconsistent with the treatment described in clause (i) of this Section
8.5(b).

 

Section 8.6 Consents. The Seller shall, during the remaining term of each
Non-Assignable Contract, use commercially reasonable efforts to (a) obtain the
consent of the applicable third party, (b) make the benefit of each such
Non-Assignable Contract available to the Purchaser following the Closing, and
(c) enforce following the Closing, at the request of the Purchaser and at the
expense and for the account of the Purchaser, any right of the Seller arising
from such Non-Assignable Contracts against the other party or parties thereto
(including the right to elect or terminate any such Non-Assignable Contract in
accordance with the terms thereof). The Seller will not take any action or
suffer any omission that would limit or restrict or terminate the benefits to
the Purchaser of any such Non-Assignable Contract unless, in good faith and
after consultation with and prior written notice to the Purchaser, the Seller is
ordered orally or in writing to do so by a Governmental Entity of competent
jurisdiction or the Seller is otherwise required to do so by Law; provided that
if any such order is appealable, the Seller will, at the Purchaser’s cost and
expense, take such actions as are requested by the Purchaser to file and pursue
such appeal and to obtain a stay of such order. With respect to any such
Non-Assignable Contract as to which the necessary approval or consent for the
assignment or transfer to the Purchaser is obtained following the Closing, the
Seller shall transfer such Non-Assignable Contract to the Purchaser by execution
and delivery of an instrument of conveyance reasonably satisfactory to the
Purchaser and the Seller within three business days following receipt of such
approval or consent.

 

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Section 8.7 Employees.

 

(a) Transferred Employees. The Purchaser has made available to the Seller in
writing a list of employees and/or independent contractors of the Seller to whom
the Purchaser intends to offer employment (the “Named Employees”). The Seller
shall terminate, effective as of the of this Agreement, all of the Named
Employees except as otherwise provided in this Section 8.7. The Purchaser shall
offer employment, on an “at will” basis on such terms and conditions as the
Purchaser may determine, to all of the Named Employees who are actively at work
on the of this Agreement. Named Employees of the Seller who accept such offer
are, as of the time they first perform services for the Purchaser, referred to
herein as the “Transferred Employees”. Except as provided herein, the Purchaser
shall have no obligation of any kind to offer employment or otherwise with
respect to any employee of the Seller. For these purposes “actively at work”
means: (i) any employee who has averaged a minimum of 30 hours per week in a
permanent position in the last three months prior to the of this Agreement; (ii)
any employee absent on the of this Agreement due to the FMLA or similar Laws;
(iii) any employee absent on the of this Agreement due to maternity leave under
the Seller’s maternity or short-term disability leave policies; (iv) any
employee absent on the of this Agreement due to military duty; (v) any employee
absent on the of this Agreement due to jury duty; and (vi) any employee absent
on the of this Agreement due to vacation, personal day, or scheduled day off
consistent with the Seller’s employment policies.

 

(b) COBRA Coverage. To the extent the Seller or any ERISA Affiliate maintains a
“group health plan” on or after the of this Agreement, the Seller shall be
solely responsible for offering and providing any COBRA Coverage (i) with
respect to any “qualified beneficiary” who previously elected to receive COBRA
Coverage under any Company Benefit Plan that is a “group health plan” and (ii)
with respect to those employees or former employees of the Seller or any ERISA
Affiliate who may become eligible to receive COBRA coverage on or prior to the
of this Agreement or in connection with the transactions contemplated by this
Agreement. To the extent the Seller and each of its ERISA Affiliates cease
providing any “group health plan” after the Closing Date and to the extent
required by the regulations issued under Code Section 4980B, if the Purchaser is
treated as a successor employer to the Seller for purposes of providing COBRA
Coverage with respect to any “qualified beneficiary” who is covered on the
Closing Date by a Company Benefit Plan that is a “group health plan”, then the
Purchaser shall provide COBRA Coverage to the extent required by Law, and the
Seller shall reimburse the Purchaser for all costs, liabilities, fees and
expenses incurred by the Purchaser as a result of its treatment as a successor
employer. Subject to the above, the Purchaser shall be solely responsible for
offering and providing any COBRA Coverage required with respect to any
Transferred Employee who becomes covered by a group health plan sponsored or
contributed to by the Purchaser and who experiences a “qualifying event”
following the Closing Date while covered under a Purchaser group health plan.
For the purposes of this Agreement, “qualified beneficiary,” “group health plan”
and “qualifying event” shall have the meaning ascribed thereto in Section 4980B
of the Code.

 

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(c) Information. The Seller shall provide the Purchaser all information relating
to each Transferred Employee as the Purchaser may reasonably request in
connection with its employment of such persons, including initial employment
dates, termination dates, reemployment dates, hours of service, compensation and
tax withholding history in a form that will be usable by the Purchaser and such
information shall be correct and complete in all respects. The Seller shall
permit the Purchaser to contact and make arrangements with each Transferred
Employee regarding such Transferred Employee’s employment or prospective
employment by the Purchaser after the Closing Date, and the Seller agrees not to
discourage any such Transferred Employee from consulting with the Purchaser.

 

(d) FMLA Information. The Seller has provided the Purchaser a list of (i) each
employee who is eligible to request FMLA leave as of the Closing Date and the
amount of FMLA leave utilized by each such employee during the current year;
(ii) each employee who will be on FMLA leave at the Closing Date and his or her
job title and description, salary and benefits; and (iii) each employee who has
requested FMLA leave to begin after the Closing Date, a description of the leave
requested and a copy of all notices provided to such employee regarding such
leave.

 

(e) Communications. Neither the Controlling Stockholders, the Seller, the
Parent, General Surgical nor their respective Affiliates, officers, directors,
managers, employees, agents or representatives shall make any communication to
any employee of the Seller regarding any 401(k), group health, life insurance,
disability, accidental death and dismemberment insurance or employee stock
purchase plan maintained by the Purchaser or any of its Affiliates or any
compensation or benefits to be provided after the Closing Date without the prior
written consent of the Purchaser.

 

(f) Division of Responsibility. Except as set forth in Section 8.7(g), the
Seller shall be solely responsible for all liabilities based upon, arising out
of or relating to the Company Benefit Plans or the employment or termination of
the Transferred Employees by the Seller, whether asserted prior to, on or after
the Closing Date. The Purchaser or one of its Affiliates shall be solely
responsible for all liabilities based upon, arising out of or relating to the
employee benefit plans of the Purchaser or its Affiliates, as applicable, or the
employment of the Transferred Employees by the Purchaser or its Affiliates, as
applicable, after such Transferred Employee first becomes a Transferred
Employee.

 

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(g) Termination of 401(k) Plan. The Seller shall have terminated, effective no
later than the day prior to the Closing Date, each Seller 401(k) Plan. At the
Closing, the Seller shall provide to the Purchaser executed resolutions
authorizing such termination. As soon as practicable following the Closing Date,
each Seller 401(k) Plan shall make a distribution available to each Transferred
Employee who has an account balance in such Seller 401(k) Plan, in accordance
with the provisions of the Seller 401(k) Plan and applicable law, and an
employee benefit plan sponsored or contributed to by the Purchaser or one of its
Affiliates and intended to meet the requirements of Section 401(k) of the Code
(a “Purchaser 401(k) Plan”) shall permit each Transferred Employee who has an
account balance in the Seller 401(k) Plan to elect to rollover such account
balance, determined as of the valuation date next preceding the date of
transfer, to such Purchaser 401(k) Plan.

 

(h) Vacation, Sick Pay and Other Paid Time Off. To the extent required by
applicable Law, the Seller shall pay to each Transferred Employee a cash lump
sum amount equal to the value of his earned but unused vacation, sick pay and
other paid time off as of the Closing Date and such payment shall be made within
the time period required by applicable Law or, if sooner, within 30 days after
the Closing Date.

 

Section 8.8 Name Change. Upon the execution and delivery of this Agreement, and
subject to the Purchaser’s request and timing, the Seller shall change its name
or discontinue the use of the name to remove any reference to the name “Anu Life
Sciences” or any other trade name used in the Business or any name derived from
or confusingly similar to any such names. As promptly as practicable following
the date of such request, the Seller shall file in all jurisdictions in which it
is qualified to do business any documents necessary to reflect such change of
name or to terminate its qualification therein.

 

Section 8.9 Post-Closing Insurance Coverage.

 

(a) The Seller shall maintain its current insurance or obtain, at its sole cost
and expense, “tail” insurance policies for such insurance, in each case
including the Purchaser as an additional named insured thereunder.

 

(b) As of the Closing Date, General Surgical shall maintain, with respect to its
activities under the Distribution Agreement, its insurance policies and limits
included in Parents insurance policies set forth on Schedule 4.17. General
Surgical shall maintain such policies during the term of the Distribution
Agreement and for a period of three years thereafter. General Surgical shall
cause such policies to include the Purchaser as an additional named insured
thereunder.

 

Article IX
CLOSING

 

Section 9.1 Closing. The Closing shall occur contemporaneously with the
execution and delivery of this Agreement. The Closing shall take place at the
offices of the Purchaser, or at such other place as the Parties may agree.

 

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Section 9.2 Seller Closing Deliveries. Contemporaneously with the execution and
delivery of this Agreement, the Seller shall deliver, or cause to be delivered,
to the Purchaser the following:

 

(a) bills of sale, instruments of assignment, certificates of title and other
conveyance documents, dated as of the of this Agreement, transferring to the
Purchaser all of the Seller’s right, title and interest in and to the Assets,
together with possession of the Assets, and evidencing the assignment of the
Assumed Contracts and the assignment of any assignable Licenses, including the
Bill of Sale and Assignment and Assumption Agreement attached hereto as Exhibit
C and executed by the Seller;

 

(b) the Patent, Trademark and Domain Name Assignment Agreement attached hereto
as Exhibit D and executed by the Seller;

 

(c) the Distributor Agreement attached hereto as Exhibit E and executed by the
Parent or its designee, provided it is a wholly-own subsidiary of Parent (the
“Distributor Agreement”);

 

(d) the Transition Operating Agreement attached hereto as Exhibit F and executed
by the Parent;

 

(e) All other documents reasonably requested by Purchaser, including as relating
to Bruce Werber and Terrell Suddarth, separation and general release agreement
between them with Parent and Seller;

 

(f) a certificate by the Secretary of the Seller, dated the Closing Date, as to
(i) the good standing of the Seller in its jurisdiction of formation and in each
other jurisdiction where the Seller is qualified to do business and (ii) the
effectiveness of the resolutions of the board of directors of the Seller
authorizing the execution, delivery and performance of this Agreement and the
transactions contemplated hereby;

 

(g) written consents of or notices to, as applicable (or waivers with respect
thereto), the third parties to those Assumed Contracts listed on Schedule 9.2(g)
(and all such consents, notices or waivers shall be in full force and effect on
and following the Closing);

 

(h) satisfactory payoff letters (“Payoff Letters”) from each lender to the
Indebtedness outstanding as of the Closing Date evidencing that, if such
aggregate amount so identified is paid to such lender on the Closing Date, such
Indebtedness shall be repaid in full and that all Liens affecting any real or
personal property of the Seller will be released, through filing of the required
UCC-3 financial statement amendment thereby terminating the security interest
immediately upon payment of Indebtedness;

 

(i) the Closing Date Indebtedness Statement;

 

(j) the Restrictive Covenant Agreements;

 

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(k) certificates from appropriate authorities as to the good standing of the
Seller; and

 

(l) all other documents required to be entered into by the Seller, the Parent,
General Surgical or any Controlling Stockholders pursuant hereto or reasonably
requested by the Purchaser to consummate the transactions contemplated hereby.

 

Section 9.3 Purchaser Closing Deliveries. On the Closing, the Purchaser shall
have delivered, or caused to be delivered, to the Seller, the following:

 

(a) the Closing Payment to be paid at Closing pursuant to Section 3.3, paid and
delivered in accordance with such Section;

 

(b) documents evidencing the payment and satisfaction of the Closing Date
Indebtedness;

 

(c) documents evidencing the assumption of the Assumed Contracts, and the
acceptance of any assignable Licenses, including the Bill of Sale and Assignment
and Assumption Agreement attached hereto as Exhibit C and executed by the
Purchaser;

 

(d) the Patent, Trademark and Domain Name Assignment Agreement attached hereto
as Exhibit D and executed by the Purchaser; and

 

(e) the Distributor Agreement attached hereto as Exhibit E;

 

(f) the Transition Operating Agreement attached hereto as Exhibit F;

 

(g) all other documents required to be entered into or delivered by the
Purchaser at or prior to the Closing pursuant hereto.

 

Section 9.4 Post-Closing Deliverables. As soon as possible after the Closing the
Seller shall have delivered, or caused to be delivered, to the Purchaser, the
following:

 

(a) A Certificate of Compliance with the Florida Department of Revenue regarding
the Seller’s satisfaction of all tax liabilities as of the Closing Date; and

 

(b) File copy of the UCC-3 financial statement amendment thereby terminating the
security interest in the Assets.

 

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Article X
INDEMNIFICATION

 

Section 10.1 Indemnification Obligations of the Seller, the Parent, General
Surgical and the Controlling Stockholders. The Seller, the Parent, General
Surgical and the Controlling Stockholders shall jointly and severally defend and
hold harmless the Purchaser Indemnified Parties from, against, and in respect
of, any and all claims, liabilities, obligations, damages, losses, costs,
expenses, penalties, fines and judgments (at equity or at Law, including
statutory and common) whenever arising or incurred (including amounts paid in
settlement, costs of investigation and reasonable attorneys’ fees and expenses)
arising out of or relating to:

 

(a) any misrepresentation, inaccuracy or breach of any representation or
warranty made by the Seller, the Parent, General Surgical or any Controlling
Stockholder in this Agreement or the Owner Ancillary Documents (for purposes of
this Section 10.1(a), such representations and warranties shall be read without
reference to materiality, Material Adverse Effect or similar monetary and
non-monetary qualifications);

 

(b) any breach or failure by the Seller, the Parent, General Surgical or any
Controlling Stockholder to comply with, perform or discharge any obligation,
agreement or covenant made by the Seller, the Parent, General Surgical or any
Controlling Stockholder in this Agreement or the Owner Ancillary Documents;

 

(c) the Excluded Liabilities;

 

(d) The Related Party Agreements and the Affiliate Loans; and

 

(e) events or circumstances occurring or existing with respect to the ownership,
operation and maintenance of the Business and the Assets on or prior to the
Closing Date, except the Assumed Liabilities.

 

The claims, liabilities, obligations, losses, damages, costs, expenses,
penalties, fines and judgments of the Purchaser Indemnified Parties described in
this Section 10.1 as to which the Purchaser Indemnified Parties are entitled to
indemnification are collectively referred to as “Purchaser Losses.”

 

Section 10.2 Indemnification Obligations of the Purchaser. The Purchaser shall
indemnify and hold harmless the Seller Indemnified Parties from, against and in
respect of any and all claims, liabilities, obligations, losses, damages, costs,
expenses, penalties, fines and judgments (at equity or at Law, including
statutory and common) whenever arising or incurred (including amounts paid in
settlement, costs of investigation and reasonable attorneys’ fees and expenses)
arising out of or relating to:

 

(a) the Purchaser’s failure to perform, discharge or satisfy the Assumed
Liabilities;

 

(b) any misrepresentation, inaccuracy or breach of any representation or
warranty made by the Purchaser in this Agreement or in any Purchaser Ancillary
Document; or

 

(c) any breach or failure by the Purchaser to comply with, perform or discharge
any obligation, agreement or covenant made by the Purchaser in this Agreement or
in any Purchaser Ancillary Document.

 

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The claims, liabilities, obligations, losses, damages, costs, expenses,
penalties, fines and judgments of the Seller Indemnified Parties described in
this Section 10.2 as to which the Seller Indemnified Parties are entitled to
indemnification are collectively referred to as “Seller Losses.”

 

Section 10.3 Indemnification Procedure. 

 

(a) Promptly after the receipt by any Indemnified Party of notice of the
commencement of any Legal Dispute against such Indemnified Party by a third
party (including any Governmental Entity) (such action, a “Third Party Claim”),
such Indemnified Party shall, if a claim with respect thereto is to be made
against any party obligated to provide indemnification pursuant to this Article
X (the “Indemnifying Party”), give such Indemnifying Party written notice of
such Third Party Claim in reasonable detail in light of the circumstances then
known to such Indemnified Party. In the event of a claim by a Purchaser
Indemnified Party such notice shall be provided to the Seller. The failure to
give such notice shall not relieve any Indemnifying Party from any obligation
hereunder except to the extent that such failure materially prejudices such
Indemnifying Party. Such Indemnifying Party shall have the right to defend and
resolve such Third Party Claim, at such Indemnifying Party’s expense and with
counsel of its choice reasonably satisfactory to the Indemnified Party. If the
Indemnifying Party assumes the defense of such Third Party Claim, the
Indemnified Party shall reasonably cooperate in such defense at the expense of
the Indemnifying Party. Notwithstanding the foregoing, the Indemnifying Party
may not assume the defense of a Third Party Claim (i) which includes criminal
charges, (ii) that does not solely seek and continue to solely seek monetary
damages, (iii) that involves a customer, supplier or employee of the Indemnified
Party, or (iv) if the Indemnified Party has been advised by counsel that an
actual conflict exists between the Indemnifying Party and the Indemnified Party
in connection with the defense of such Third Party Claim (the conditions set
forth in clauses (i) through (iv) are, collectively, the “Litigation
Conditions”). In the event, however, that the Indemnifying Party declines or
fails to assume, or is not permitted to assume, the defense of the Legal Dispute
on the terms provided above or to employ counsel reasonably satisfactory to the
Indemnified Party, in either case within such 20-day period, or if the
Indemnifying Party is not entitled to assume the defense of the Legal Dispute in
accordance with the preceding sentence, then such Indemnified Party may employ
counsel to represent or defend it in any such audit, investigation, action or
proceeding and the Indemnifying Party shall pay the reasonable fees and
disbursements of such counsel for the Indemnified Party as incurred; provided,
however, that the Indemnifying Party shall not be required to pay the fees and
disbursements of more than one counsel for all Indemnified Parties in any
jurisdiction in any single Legal Dispute. In any Legal Dispute for which
indemnification is being sought hereunder the Indemnified Party or the
Indemnifying Party, whichever is not assuming the defense of such Legal Dispute,
shall have the right to participate in such matter and to retain its own counsel
at such Party’s own expense. If the Indemnifying Party has assumed the defense
of a Third Party Claim as provided in this Section 10.3(a), the Indemnified
Party may retain separate co-counsel at its sole cost and expense and may
participate in the defense of such Third Party Claim (though not as counsel of
record, and subject to all privileges); provided, however, that if (A) any of
the Litigation Conditions come into existence or (B) the Indemnifying Party
fails to take reasonable steps necessary to defend diligently such Third Party
Claim, the Indemnified Party may assume its own defense, and the Indemnifying
Party will be liable for all reasonable costs or expenses paid or incurred in
connection with such defense. The Indemnifying Party may not consent to the
entry of any judgment or enter into any settlement with respect to any such
Third Party Claim without the prior written consent of the Indemnified Party,
which consent will not be unreasonably withheld or delayed, unless such
settlement involves solely the payment of money and includes a full release of
the Indemnified Party in respect of a Third Party Claim for which the
Indemnifying Party has assumed the defense. The Indemnified Party may not
consent to the entry of any judgment or enter into any settlement with respect
to such Third Party Claim without the prior written consent of the Indemnifying
Party, which consent, if the Indemnifying Party has not assumed the defense of
such Third Party Claim, will not be unreasonably withheld or delayed, unless the
Indemnifying Party fails to assume, or is not permitted to assume, and maintain
the defense of such Third Party Claim or such settlement includes an
unconditional release of the Indemnifying Party and its officers, directors,
managers, employees and Affiliates from all liability arising out of such claim.
The Indemnifying Party or the Indemnified Party, as the case may be, shall at
all times use commercially reasonable efforts to keep the Indemnifying Party or
the Indemnified Party, as the case may be, reasonably apprised of the status of
any matter the defense of which they are maintaining and to cooperate in good
faith with each other with respect to the defense of any such matter; provided,
however, that no party will be required to provide cooperation or furnish any
records or other information that would (1) jeopardize the attorney client, work
product or similar privilege of the Person in possession or control of such
records or other information or (2) contravene any confidentiality Contract,
nondisclosure Contract or similar obligation of the Person in possession or
control of such records or other information.

 

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(b) In the event an Indemnified Party claims a right to payment pursuant to this
Agreement other than pursuant to a Third Party Claim in accordance with Section
10.3(a), such Indemnified Party shall send written notice of such claim to the
appropriate Indemnifying Party. Such notice shall specify the basis for such
claim. The failure by any Indemnified Party so to notify the Indemnifying Party
shall not relieve the Indemnifying Party from any liability that it may have to
such Indemnified Party with respect to any claim made pursuant to this Section
10.3(b). In the event the Indemnifying Party does not notify the Indemnified
Party within 30 days following its receipt of such notice that the Indemnifying
Party disputes its liability to the Indemnified Party under this Article X or
the amount thereof, the claim specified by the Indemnified Party in such notice
shall be conclusively deemed a liability of the Indemnifying Party under this
Article X, and the Indemnifying Party shall pay the amount of such liability to
the Indemnified Party on demand or, in the case of any notice in which the
amount of the claim (or any portion of the claim) is estimated, on such later
date when the amount of such claim (or such portion of such claim) becomes
finally determined. In the event the Indemnifying Party has timely disputed its
liability with respect to such claim as provided above, as promptly as possible,
such Indemnified Party and the appropriate Indemnifying Party shall establish
the merits and amount of such claim (by mutual agreement, litigation,
arbitration or otherwise) and, within five business days following the final
determination of the merits and amount of such claim, the Indemnifying Party
shall pay to the Indemnified Party in immediately available funds an amount
equal to such claim as determined hereunder.

 

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Section 10.4 Claims Period. The Claims Period hereunder shall begin on the date
of this Agreement and terminate as follows:

 

(a) with respect to all Purchaser Losses arising hereunder, on the date that is
90 days following the termination of the applicable statute of limitations or,
if there is no applicable statute of limitations, the Claims Period shall
terminate on the date that is five years following the Closing Date; and

 

(b) with respect to Seller Losses arising under Section 10.2, the Claims Period
shall terminate on the date that is 90 days following the termination of the
applicable statute of limitations or, if there is no applicable statute of
limitations, the Claims Period shall terminate on the date that is five years
following the Closing Date.

 

Notwithstanding the foregoing, if, prior to the close of business on the last
day of the applicable Claims Period, an Indemnifying Party shall have been
properly notified of a claim for indemnity hereunder and such claim shall not
have been finally resolved or disposed of at such date, such claim shall
continue to survive and shall remain a basis for indemnity hereunder until such
claim is finally resolved or disposed of in accordance with the terms of this
Agreement.

 

Section 10.5 Adjustment to Purchase Price. Any indemnification payment made
pursuant to this Article X shall be treated as an adjustment to the Purchase
Price for Tax purposes to the extent permitted by applicable Law.

 

Section 10.6 Holdback Amount and Indemnification Reserve. The Purchaser may, at
its discretion, offset against the Holdback Amount and the Indemnification
Reserve any amounts payable by a Controlling Stockholder, the Parent or the
Seller to a Purchaser Indemnified Party under this Agreement.

 

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Article XI
MISCELLANEOUS PROVISIONS

 

Section 11.1 Notices. Any notices or other communications required or permitted
hereunder shall be deemed to have been properly given and delivered if in
writing by such Party and delivered personally or sent email transmission or
nationally recognized overnight courier service guaranteeing overnight delivery
or by registered or certified mail (return receipt requested) (with postage and
other fees prepaid), addressed as follows:

 

  To the Purchaser:

Vera Acquisition, LLC

32 West 200 South, Suite 150

Salt Lake City, Utah 84101

Attention: Chief Executive Officer

Email: dniccum@verabioscience.com

        with a copy to: Bennett Tueller Johnson & Deere, LLC
3165 E. Millrock Drive, Suite 500
Salt Lake City, Utah 84121
Attention: Brent J. Hawkins
Email: bhawkins@btjd.com         To the Seller, the Parent, General Surgical or
the Controlling Stockholders:

Biotech Products Services and Research Inc.

4045 Sheridan Ave., Suite 239

Miami, FL 33140

   

Attention: Albert Mitrani

Email: albert@bpsrhealth.com

        with a copy to:

Magri Law, LLC

2642 NE 9th Ave.

Fort Lauderdale, FL 33330

Attention: Philip Magri

Email: pmagri@magrilaw.com

 

or to such other representative or at such other address of a Party as such
Party may furnish to the other Parties in writing. Any such notice,
communication or delivery shall be deemed given or made (a) on the date of
delivery, if delivered in person or by email transmission, or (b) on the first
business day following timely delivery to a national overnight courier service
or (c) on the fifth business day following it being mailed by registered or
certified mail.

 

Section 11.2 Schedules and Exhibits. The Schedules and Exhibits are hereby
incorporated into this Agreement and are hereby made a part of this Agreement as
if set out in full herein.

 

Section 11.3 Binding Effect; Assignment. This Agreement and all of the
provisions hereof shall be binding upon and inure to the benefit of the Parties
and their respective successors and permitted assigns. Neither this Agreement
nor any of the rights, interests or obligations hereunder shall be assigned,
directly or indirectly, including by operation of Law, by any Party without the
prior written consent of the other Parties; provided, however, that the
Purchaser may, without the consent of the Seller, the Parent, General Surgical
or the Controlling Stockholders, (a) assign any or all of its rights and
interests hereunder to one or more of its Affiliates (in which case, the
Purchaser nonetheless shall remain responsible for the performance of all of its
obligations hereunder), (b) designate one or more of its Affiliates to perform
its obligations hereunder (in which case, the Purchaser nonetheless shall remain
responsible for the performance of all of its obligations hereunder), (c) assign
this Agreement to its lenders for collateral security purposes and (d) assign
this Agreement to a subsequent purchaser of all or a substantial portion of the
Purchaser (in which case, the Purchaser nonetheless shall remain responsible for
the performance of all of its obligations hereunder).

 

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Section 11.4 Captions. The titles, captions and table of contents contained
herein are inserted herein only as a matter of convenience and for reference and
in no way define, limit, extend or describe the scope of this Agreement or the
intent of any provision of this Agreement.

 

Section 11.5 Controlling Law; Amendment. This Agreement shall be governed by and
construed and enforced in accordance with the internal Laws of the State of Utah
(regardless of the Laws that might otherwise govern under applicable principles
of conflicts of laws thereof). This Agreement may not be amended, modified or
supplemented except by written agreement of the Parties.

 

Section 11.6 Consent to Jurisdiction, Etc. Each Party hereby irrevocably
consents and agrees that any Legal Dispute shall be brought only to the
exclusive jurisdiction of the courts of the State of Utah or the federal courts
located in the State of Utah, and each Party hereby consents to the jurisdiction
of such courts (and of the appropriate appellate courts therefrom) in any such
Legal Dispute and irrevocably waives, to the fullest extent permitted by Law,
any objection that it may now or hereafter have to the laying of the venue of
any such Legal Dispute in any such court or that any such Legal Dispute that is
brought in any such court has been brought in an inconvenient forum. During the
period a Legal Dispute is pending before a court, all Legal Disputes with
respect to such Legal Dispute or any other Legal Dispute, including any
counterclaim, cross-claim or interpleader, shall be subject to the exclusive
jurisdiction of such court. Each Party hereby waives, and shall not assert as a
defense in any Legal Dispute, that (a) such Party is not subject thereto, (b)
such Legal Dispute may not be brought or is not maintainable in such court, (c)
such Party’s property is exempt or immune from execution, (d) such Legal Dispute
is brought in an inconvenient forum or (e) the venue of such Legal Dispute is
improper. A final judgment in any Legal Dispute described in this Section 11.6
following the expiration of any period permitted for appeal and subject to any
stay during appeal shall be conclusive and may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by
applicable Laws.

 

Section 11.7 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of Law or public
policy, all other terms, conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated by this Agreement is not affected in
any manner materially adverse to any Party. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible in a mutually
acceptable manner in order that the transactions contemplated by this Agreement
be consummated as originally contemplated to the fullest extent possible.

 

Section 11.8 Counterparts. This Agreement may be executed in counterparts, each
of which shall be deemed an original, and it shall not be necessary in making
proof of this Agreement or the terms of this Agreement to produce or account for
more than one of such counterparts. Delivery of an executed counterpart of a
signature page to this Agreement by facsimile or other electronic imaging means,
including email transmission by PDF, shall be effective as delivery of a
manually executed counterpart to this Agreement.

 

54

 

 

Section 11.9 No Third-Party Beneficiaries. Nothing expressed or implied in this
Agreement is intended, or shall be construed, to confer upon or give any Person
other than the Parties, and their successors or permitted assigns, any right,
remedy, obligation or liability under or by reason of this Agreement, or result
in such Person being deemed a third-party beneficiary of this Agreement.

 

Section 11.10 Waiver. Any agreement on the part of a Party to any extension or
waiver of any provision of this Agreement shall be valid only if set forth in an
instrument in writing signed on behalf of such Party. A waiver by a Party of the
performance of any covenant, agreement, obligation, condition, representation or
warranty shall not be construed as a waiver of any other covenant, agreement,
obligation, condition, representation or warranty. A waiver by any Party of the
performance of any act shall not constitute a waiver of the performance of any
other act or an identical act required to be performed at a later time.

 

Section 11.11 Integration. This Agreement and the documents executed pursuant
hereto supersede all negotiations, agreements and understandings among the
Parties with respect to the subject matter of this Agreement and constitute the
entire agreement among the Parties with respect thereto.

 

Section 11.12 Cooperation Following the Closing. Following the Closing, each
Party shall deliver to the other Parties such further information and documents
and shall execute and deliver to the other Parties such further instruments and
agreements as any other Party shall reasonably request to consummate or confirm
the transactions provided for herein, to accomplish the purpose of this
Agreement or to assure to any other Party the benefits of this Agreement.

 

Section 11.13 Transaction Costs. Except as provided above or as otherwise
expressly provided herein, (a) the Purchaser shall pay its own fees, costs and
expenses incurred in connection herewith and the transactions contemplated
hereby, including the fees, costs and expenses of its financial advisors,
accountants and counsel, and (b) the fees, costs and expenses of the Seller, the
Parent, General Surgical and the Controlling Stockholders incurred in connection
herewith and the transactions contemplated hereby shall be paid by the Seller.

 

Section 11.14 Waiver of Jury Trial. Each Party acknowledges and agrees that any
Legal Dispute that may arise under this Agreement is likely to involve
complicated and difficult issues, and therefore it hereby irrevocably and
unconditionally waives any right it may have to a trial by jury in respect of
any Legal Dispute.

 

[Signature pages follow]

 

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IN WITNESS WHEREOF, the Parties have caused this Agreement to be duly executed,
as of the date first above written.

 

  PURCHASER:       VERA ACQUISITION, LLC         By: /s/ David Niccum   Name:
David Niccum   Title: Chief Executive Offficer

 

  SELLER:       ANU LIFE SCIENCES, INC.       By: /s/ Bruce Werber   Name: Bruce
Werber   Title: Chief Executive Officer

 

  PARENT:       BIOTECH PRODUCTS SERVICES AND RESEARCH, INC.         By: /s/
Albert Mitrani   Name: Albert Mitrani   Title: Chief Executive Officer

 

  GENERAL SURGICAL FLORIDA, INC.:         By: /s/ Albert Mitrani   Name: Albert
Mitrani   Title: Chief Executive Officer

 

[Signature Page to Asset Purchase Agreement]

 

 

 

 

  CONTROLLING STOCKHOLDERS:           /s/ Albert Mitrani   Name: Albert Mitrani
          /s/ Ian T. Bothwell   Name: Ian T. Bothwell           /s/ Maria I.
Mitrani   Name: Maria I. Mitrani           /s/ Bruce Werber   Name: Bruce Werber
          /s/ Terrell Suddarth   Name: Terrell Suddarth

 

[Signature Page to Asset Purchase Agreement]

 

 

 

 

LIST OF EXHIBITS

 

Exhibit A   Restrictive Covenant Agreements Exhibit B   Closing Date
Indebtedness Statement Exhibit C   Bill of Sale and Assignment and Assumption
Agreement Exhibit D   Patent, Trademark and Domain Name Assignment Agreement
Exhibit E   Distributor Agreement Exhibit F   Transition Services Agreement