**Exhibit10.1**

 

**ASSETPURCHASE AGREEMENT**

 

between

 

**AMERICAN MEDICAL SYSTEMS, INC.**

 

and

 

**CONCEPTUS,INC.**

 

Dated as of September 30,2009

 

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**TABLE OFCONTENTS**

 
| ** **                                             | ** **                                                         | ** ** | **PAGE** |
|--------------------------------------------------------|--------------------------------------------------------------------|------------|----------|
|                                                   |                                                               |       |     |
| ARTICLE 1  DEFINITIONS AND TERMS                       |                                                               | 1          |
| 1.1                                                    | Certain Definitions                                                |       | 1        |
| 1.2                                                    | Other Terms                                                        |       | 5        |
| 1.3                                                    | Other Definitional Provisions                                      |       | 6        |
|                                                   |                                                               |       |     |
| ARTICLE 2  PURCHASE AND SALE                           |                                                               | 6          |
| 2.1                                                    | Purchase and Sale of Conveyed Assets and Assumption of Liabilities |       | 6        |
| 2.2                                                    | Purchase Price                                                     |       | 8        |
| 2.3                                                    | Allocation of Purchase Price; Withholding                          |       | 8        |
| 2.4                                                    | Closing; Delivery and Payment                                      |       | 9        |
| 2.5                                                    | License Grant                                                      |       | 10       |
|                                                   |                                                               |       |     |
| ARTICLE 3  REPRESENTATIONS AND WARRANTIES OF PARENT    |                                                               | 10         |
| 3.1                                                    | Organization                                                       |       | 10       |
| 3.2                                                    | Authority; Binding Effect                                          |       | 10       |
| 3.3                                                    | Noncontravention                                                   |       | 11       |
| 3.4                                                    | Governmental Consents and Approvals                                |       | 11       |
| 3.5                                                    | Litigation and Claims                                              |       | 11       |
| 3.6                                                    | Compliance with Laws                                               |       | 12       |
| 3.7                                                    | Product Registrations; Regulatory Compliance                       |       | 12       |
| 3.8                                                    | Material Contracts                                                 |       | 12       |
| 3.9                                                    | Intellectual Property                                              |       | 13       |
| 3.10                                                   | Assets                                                             |       | 15       |
| 3.11                                                   | Taxes                                                              |       | 16       |
| 3.12                                                   | Brokers                                                            |       | 16       |
|                                                   |                                                               |       |     |
| ARTICLE 4  REPRESENTATIONS AND WARRANTIES OF PURCHASER |                                                               | 16         |
| 4.1                                                    | Organization and Qualification                                     |       | 16       |
| 4.2                                                    | Corporate Authorization                                            |       | 16       |
| 4.3                                                    | Binding Effect                                                     |       | 16       |
| 4.4                                                    | Noncontravention                                                   |       | 16       |
| 4.5                                                    | Consents and Approvals                                             |       | 17       |
| 4.6                                                    | Brokers                                                            |       | 17       |
|                                                   |                                                               |       |     |
| ARTICLE 5  COVENANTS AND OTHER AGREEMENTS              |                                                               | 17         |
| 5.1                                                    | Further Assurances                                                 |       | 17       |
| 5.2                                                    | Purchaser’s Investigation; No Additional Representations      |       | 18       |
| 5.3                                                    | Bulk Transfer Laws                                                 |       | 18       |
| 5.4                                                    | Litigation Support                                                 |       | 18       |
| 5.5                                                    | Tax Matters                                                        |       | 19       |
| 5.6                                                    | Trademarks; Names                                                  |       | 19       |
| 5.7                                                    | Non-Compete                                                        |       | 20       |
| 5.8                                                    | Assignment and Assumption of the Settlement and License Agreement  |       | 20       |

 

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| ARTICLE 6  SURVIVAL AND INDEMNIFICATION |                                             | 21     |
|-----------------------------------------|--------------------------------------------------|--------|
| 6.1                                     | Survival                                         |   | 21 |
| 6.2                                     | Indemnification by Purchaser                     |   | 21 |
| 6.3                                     | Indemnification by Parent                        |   | 22 |
| 6.4                                     | Indemnification Procedures                       |   | 22 |
| 6.5                                     | Exclusive Remedy; Limitation of Remedy           |   | 24 |
| 6.6                                     | Characterization of Indemnification Payments     |   | 24 |
| 6.7                                     | Computation of Losses Subject to Indemnification |   | 24 |
| 6.8                                     | Limitations on Liability                         |   | 24 |
| 6.9                                     | Mitigation                                       |   | 24 |
| 6.10                                    | Waiver of Conditions; Indemnity                  |   | 24 |
|                                    |                                             |   |   |
| ARTICLE 7  MISCELLANEOUS                |                                             | 25     |
| 7.1                                     | Notices                                          |   | 25 |
| 7.2                                     | Specific Performance                             |   | 26 |
| 7.3                                     | Amendment; Waiver                                |   | 26 |
| 7.4                                     | Assignment                                       |   | 26 |
| 7.5                                     | Entire Agreement                                 |   | 26 |
| 7.6                                     | Fulfillment of Obligations                       |   | 26 |
| 7.7                                     | Parties in Interest                              |   | 26 |
| 7.8                                     | Public Disclosure; Confidential Information      |   | 27 |
| 7.9                                     | Expenses                                         |   | 28 |
| 7.10                                    | Schedules                                        |   | 28 |
| 7.11                                    | Governing Law                                    |   | 28 |
| 7.12                                    | Waiver of Jury Trial                             |   | 28 |
| 7.13                                    | Counterparts                                     |   | 29 |
| 7.14                                    | Headings                                         |   | 29 |
| 7.15                                    | Severability                                     |   | 29 |

 

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**List ofSchedules**

 
| 1.1(a)     |   | Excluded Names,  Logo and Marks           |
|------------|--------|-------------------------------------------|
| 1.1(b)     |   | Other Excluded  Assets                    |
| 1.1(c)     |   | Knowledge of  Parent                      |
| 1.1(d)     |   | Permitted  Encumbrances                   |
| 2.1(a)(i)  |   | Assumed  Contracts                        |
| 2.1(a)(ii) |   | Purchased IP  Rights                      |
| 2.3        |   | Allocation of  Purchase Price             |
| 3.3        |   | Required Third  Party Consents            |
| 3.4        |   | Required  Governmental Consents           |
| 3.5        |   | Pending or  Threatened Litigation         |
| 3.6        |   | Compliance with  Laws                     |
| 3.7        |   | Product  Registrations                    |
| 3.8(a)     |   | Material  Contracts                       |
| 3.9        |   | Intellectual  Property                    |
| 3.11       |   | Taxes                                     |
| 4.5        |   | Purchaser  Required Governmental Consents |

 

**List of Exhibits**

 
| A |   | Form of  Bill of Sale                        |
|---|--------|---------------------------------------------------|
| B |   | Form of  Assignment and Assumption Agreement |

 

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**ASSETPURCHASE AGREEMENT**

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”) is dated as of September 30,2009, by and between American Medical Systems, Inc., a Delawarecorporation (“Parent”), and Conceptus, Inc., a Delaware corporation(“Purchaser”).

 

**RECITALS:**

 

WHEREAS, the Asset Selling Corporations (as defined below) own theConveyed Assets (as defined below); and

 

WHEREAS, the parties hereto desire that the Asset Selling Corporationsshall sell and transfer to Purchaser, and Purchaser shall purchase from theAsset Selling Corporations all of the Conveyed Assets and assume all of theAssumed Liabilities (as defined below), upon the terms and subject to the conditionsset forth herein;

 

**AGREEMENT**

 

NOW, THEREFORE, in consideration of the above recitals, which arehereby incorporated by reference herein, of the mutual covenants andundertakings contained herein, and subject to and on the terms and conditionsherein set forth, the parties hereto agree as follows:

 

# **ARTICLE 1**DEFINITIONS AND TERMS

# ** **

1.1           Certain Definitions.  As used inthis Agreement, the following terms shall have the meanings set forth or asreferenced below:

 

“Affiliate” shall mean, with respect to any Person, any otherperson directly or indirectly controlling, controlled by, or under commoncontrol with, such Person specified.  Theterm “control” as used in the immediately preceding sentence, means theownership of more than 50% of the shares of stock entitled to vote for theelection of directors in the case of a corporation and more than 50% of thevoting power in the case of a business entity other than a corporation.

 

“Agreement” shall mean this Agreement, as the same may beamended or supplemented from time to time in accordance with the terms hereof,and all Exhibits and Schedules hereto.

 

“Ancillary Agreements” shall mean the Assignment and AssumptionAgreement, Bill of Sale and the assignments of patents and trademarks deliveredby the Asset Selling Corporations at the Closing.

 

“Allocation” shall have the meaning set forth in Section 2.3hereof.

 

“Asset Selling Corporation” shall mean, individually, Parent,AMS Research Corporation, a Delaware corporation and Ovion Inc., a Delawarecorporation (collectively referred to herein as the “Asset SellingCorporations”).

 

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“Assignment and Assumption Agreement” shall have the meaning setforth in Section 2.4(b)(ii) hereof.

 

“Assumed Contracts” shall have the meaning set forth in Section 2.1(a)(i) hereof.

 

“Assumed Liabilities” shall have the meaning set forth in Section 2.1(c) hereof.

 

“Bill of Sale” shall have the meaning set forth in Section 2.4(b)(i) hereof.

 

“Claim” shall have the meaning set forth in Section 6.4hereof.

 

“Claim Notice” shall have the meaning set forth in Section 6.4hereof.

 

“Closing” shall mean the closing of the transactionscontemplated by this Agreement.

 

“Closing Date” shall have the meaning set forth in Section 2.4(a) hereof.

 

“Code” shall mean the United States Internal Revenue Code of1986, as amended.

 

“Confidentiality Agreement” shall mean that certain letteragreement regarding confidential materials, dated June 16, 2009 betweenParent and Purchaser.

 

“Contract” means any contract, agreement, license, instrument,lease, or commitment, whether oral or written.

 

“Conveyed Assets” shall have the meaning set forth in Section 2.1(a) hereof,it being understood that the Conveyed Assets do not include the ExcludedAssets.

 

“Disclosure Schedules” shall have the meaning set forth in thepreamble to Article 3 hereof.

 

“Excluded Assets” shall mean, with respect to any Asset SellingCorporation, (i) all cash and cash equivalents, (ii) all intercompanyaccounts receivable, (iii) all losses, loss carryforwards and rights toreceive refunds, credits and credit carryforwards with respect to any and allTaxes, to the extent attributable to a taxable period ending on or prior to theClosing Date, including interest thereon, (iv) its corporate books andrecords, (v) all insurance recoveries due to it and relating to periodsprior to the Closing Date, (vi) all assets of any of its employee benefitplans, (vii) the “American Medical Systems” name and logo and the othernames, logos and marks listed on **Schedule 1.1(a) **hereto,(viii) stock, shares, units, interests and other ownership and/or equityor debt securities held by an Asset Selling Corporation in another entity, (ix) controlof the attorney-client privilege with respect to any Asset Selling Corporationor its Affiliates except as related exclusively to the Purchased IP Rights, (x) allrights existing under all contracts to which any Asset Selling Corporation is aparty, except for any Assumed Contracts, (xi) any Asset Selling Corporation’srights under or pursuant to this Agreement and agreements entered into pursuantto this Agreement, (xii) any assets listed on **Schedule 1.1(b) **hereto,and (xiii) any

 

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other assets notspecifically listed and identified on **Schedule 2.1(a) **ordescribed in Section 2.1(a)(iii).

 

“Excluded Liabilities” shall have the meaning set forth in Section 2.1(d) hereof.

 

“Governmental Authority” shall mean any supranational, national,federal, state or local judicial, legislative, executive or regulatoryauthority.

 

“Governmental Authorization” shall mean all licenses, permits,certificates and other authorizations and approvals required to own theConveyed Assets as owned as of the date of this Agreement under applicable Law.

 

“Governmental Order” shall mean any order, writ, judgment,injunction, decree, stipulation, determination or award entered by or with anyGovernmental Authority.

 

“Income Tax” or “Income Taxes” shall mean all Taxes basedupon, measured by, or calculated with respect to (i) gross or net incomeor gross or net receipts or profits (including, but not limited to, any capitalgains, minimum taxes and any Taxes on items of tax preference, but notincluding sales, use, real or personal property transfer or other similarTaxes), (ii) multiple bases (including, but not limited to, corporatefranchise, doing business or occupation Taxes) if one or more of the bases uponwhich such Tax may be based, measured by, or calculated with respect to isdescribed in clause (i) above, or (iii) withholding taxes measuredby, or calculated with respect to, distributions (other than wages).

 

“Indemnified Parties” shall have the meaning set forth in Section 6.3(a) hereof.

 

“Indemnifying Party” shall have the meaning set forth in Section 6.4hereof.

 

“Intellectual Property”shall mean (i) national and multinational statutory inventionregistrations, patents and patent applications, including all renewals,reissues, divisions, substitutions, continuations, continuations-in-part,extensions and reexaminations and all foreign counterparts thereof, registeredor applied for in the United States and all other nations throughout the world(“*Patents*”), (ii) trademarks, servicemarks, trade dress, logos, slogans, 800 numbers, domain names, URLs, tradenames, service names and corporate names (whether or not registered) in theUnited States and all other nations throughout the world, including allvariations, derivations, and combinations thereof, and all registrations andapplications for registration or renewals of the foregoing and all goodwillassociated therewith (“*Trademarks*”), (iii) copyrightsand rights under copyrights (whether or not registered) and registrations andapplications for registration or renewals thereof in the United States and allother nations throughout the world, including all derivative works, regardlessof the medium of fixation or means of expression (“*Copyrights*”),(iv) trade secrets and, whether or not confidential, business information(including pricing and cost information, business and marketing plans andcustomer and supplier lists), know-how (including manufacturing and productionprocesses and techniques and research and development information), inventions,whether or not patentable, reduced to practice or made the subject of one ormore pending patent applications, and all improvements thereto (“*Trade Secrets*”), (v) industrial designs (whether or notregistered), (vi) rights in

 

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databases and data collections (including knowledgedatabases, customer lists and customer databases) in the United States and allother nations throughout the world, whether registered or unregistered, and anyapplications for registration therefor, (vii) all rights in all of theforegoing provided by treaties, conventions and common law, (viii) allrights to sue or recover and retain damages and costs and attorneys’ fees forpast, present and future infringement or misappropriation of any of theforegoing, and (ix) any other proprietary or intellectual property rightsnow known or hereafter recognized in any jurisdiction.

 

“IRS” shall mean the Internal Revenue Service of the UnitedStates.

 

“Knowledge of Parent” shall mean, and shall be restricted to,the actual knowledge of only those Persons that are listed on**Schedule 1.1(c) **hereto, and the knowledge of facts ofwhich such Persons have received notice in writing.

 

“Laws” shall include any federal, state, foreign or local law,statute, ordinance, rule, regulation, order, injunction, judgment or decree.

 

“Liabilities” shall mean any and all debts, liabilities andobligations, whether accrued or fixed, known or unknown, absolute orcontingent, matured or unmatured or determined or determinable.

 

“Liens” shall mean any lien, security interest, mortgage, chargeor similar encumbrance.

 

“Losses” shall have the meaning set forth in Section 6.2hereof.

 

“Material Contracts” shall have the meaning set forth in Section 3.8(a) hereof.

 

“Notice Period” shall have the meaning set forth in Section 6.4hereof.

 

“Parent” shall have the meaning set forth in the heading of thisAgreement.

 

“Permits” shall have the meaning set forth in Section 3.6(b) hereof.

 

“Permitted Encumbrances” shall mean (i) all liens, securityinterests, mortgages, charges or encumbrances set forth on **Schedule 1.1(d) **hereto,(ii) such liens, charges or encumbrances and other imperfections of titleas do not individually or in the aggregate materially detract from the value orimpair the use of the property subject thereto, or (iii) liens for Taxesnot yet due or which are being actively contested in good faith by appropriateproceedings.

 

“Person” shall mean an individual, a corporation, a partnership,an association, a trust or other entity or organization.

 

“Pre-Closing Taxable Period” shall mean any Tax period ending onor before the Closing Date and that portion of any Straddle Taxable Periodending on the Closing Date.

 

“Product Registrations” shall have the meaning set forth in Section 3.7hereof.

 

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“Purchase Price” shall have the meaning set forth in Section 2.2hereof.

 

“Purchased IP Rights” shall have the meaning set forth in Section 2.1(a)(ii) hereof.

 

“Purchaser” shall have the meaning set forth in the heading ofthis Agreement and shall include its Affiliates.

 

“Purchaser Indemnified Parties” shall have the meaning set forthin Section 6.3(a) hereof.

 

“Restricted Business” shall have the meaning set forth in Section 5.7hereof.

 

“Restricted Period” shall have the meaning set forth in Section 5.7hereof.

 

“Seller Indemnified Parties” shall have the meaning set forth inSection 6.2(a) hereof.

 

“Settlement and License Agreement” shall have the meaning setforth in Section 5.8 hereof.

 

“Straddle Taxable Period” shall have the meaning set forth in Section 5.5(b) hereof.

 

“Tax” or “Taxes” shall mean all taxes, charges, duties,fees, levies or other assessments, including but not limited to, income,excise, property, sales, value added, profits, license, withholding (with respectto compensation or otherwise), payroll, employment, net worth, capital gains,transfer, stamp, social security, environmental, occupation and franchisetaxes, imposed by any Governmental Authority, and including any interest,penalties and additions attributable thereto.

 

“Tax Return” or “Tax Returns” shall mean any return,report, declaration, information return or claim for refund filed or requiredto be filed with any Governmental Authority in connection with thedetermination, assessment or collection of any Tax or the administration of anyLaws relating to any Tax, including any schedule or attachment thereto and anyamendment thereof.

 

“Technology” shall mean copies and tangible embodiments ofIntellectual Property, whether in electronic, written or other media, includingsoftware, technical documentation, specifications, designs, bills of material,build instructions, test reports, schematics, algorithms, formulae, databases,lab notebooks, invention disclosures, processes, prototypes, samples, studies,or other know-how and other works of authorship contained therein.

 

“Treasury Regulations” means the Income Tax Regulationspromulgated under the Code, as such regulations may be amended from time totime (including corresponding provisions of succeeding regulations).

 

1.2           Other Terms.  Other termsmay be defined elsewhere in the text of this Agreement and, unless otherwiseindicated, shall have such meaning throughout this Agreement.

 

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## 1.3           Other Definitional Provisions.

##  

### (a)           Thewords “hereof,” “herein,” “hereto” and “hereunder” and words of similar import,when used in this Agreement, shall refer to this Agreement as a whole and notto any particular provision of this Agreement.

###  

### (b)           Theterms defined in the singular shall have a comparable meaning when used in theplural, and vice versa.

###  

### (c)           Theterms “dollars” and “$” shall mean United States dollars.

###  

### (d)           Theterms “include” and “including” and variations thereof are not limiting andshall be deemed to be followed by the words “without limitation.”

###  

### (e)           Referencesto statutes shall include all regulations promulgated thereunder and referencesto statues or regulations shall be construed as including all statutory andregulatory provisions, consolidating, amending or replacing the statute orregulations.

###  

### (f)            Referencesto “license” or “licenses” shall include “sublicense” or “sublicenses” asapplicable.

###  

### (g)           Theparties participated jointly in the negotiation and drafting of this Agreementand the language used in this Agreement shall be deemed to be the languagechosen by the parties to express their mutual intent.  If an ambiguity or question of intent orinterpretation arises, then this Agreement will accordingly be construed as draftedjointly by the parties to this Agreement, and no presumption or burden of proofwill arise favoring or disfavoring any party to this Agreement by virtue of theauthorship of any of the provisions of this Agreement.

###  

### (h)           Theschedules and exhibits to this Agreement are a material part hereof and shallbe treated as if fully incorporated into the body of this Agreement.

 

# **ARTICLE 2**PURCHASE AND SALE

 

## 2.1           Purchase and Sale of Conveyed Assets and Assumption ofLiabilities.

##  

### (a)           Onthe terms and subject to the conditions set forth herein, at the Closing,Parent agrees to sell, convey, assign and transfer, and agrees to cause theAsset Selling Corporations to sell, convey, assign and transfer, to Purchaser,and Purchaser agrees to purchase, acquire and accept from the Asset SellingCorporations, free and clear of all Liens, other than Permitted Encumbrances,all of the right, title and interest of the Asset Selling Corporations in andto the assets, properties and rights identified and listed on **Schedule 2.1(a) **for each of the categories set forth inthe following clauses but with the exception of the Excluded Assets(collectively, the “Conveyed Assets”):

###  

#### (i)            the contracts, licenses, agreements andcommitments set forth on **Schedule 2.1(a)(i) **(“AssumedContracts”); provided, however, notwithstanding anything

 

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#### herein to thecontrary, with regard to the conveyance, assignment and transfer of thatcertain Agreement between Parent and Steve Tremulis dated July 29, 2005(the “Tremulis Agreement”) and that certain Agreement between Parent andJeff Callister dated July 29, 2005 (the “Callister Agreement”),such conveyance, assignment and transfer shall only apply with respect toParent’s rights under Sections 8, 9(b) and 9(c) of such agreementsand only to the extent such rights relate to the Conveyed Assets identified in Section 2.1(a)(ii) andSection 2.1(a)(iii) (for purposes of clarification, Parent isnot conveying, assigning or transferring (A) any obligations or liabilitiesunder such agreements, or (B) any rights under Sections 8, 9(b) and 9(c) ofsuch agreements with respect to matters unrelated to the Conveyed Assetsidentified in Section 2.1(a)(ii) and Section 2.1(a)(iii));

####  

#### (ii)           all rights to the Intellectual Propertyand Technology owned by the Asset Selling Corporations set forth on Schedule2.1(a)(ii), and all of the Asset Selling Corporations’ rights to theIntellectual Property and Technology licensed to the Asset Selling Corporationsset forth on Schedule 2.1(a)(ii) (collectively, the “Purchased IPRights”);

####  

#### (iii)          all tangible and electronic copies of theTechnology listed in to Schedule 2.1(a)(ii) and included in the PurchasedIP Rights, all patent prosecution files relating to the Purchased IP Rights, allbusiness and financial records, files, books and documents (whether in hardcopy or computer format), in each case in the possession of or within thecontrol of the Asset Selling Corporations, only to the extent relatingexclusively to the Conveyed Assets; provided, however, that the Asset SellingCorporations may redact any information not exclusively related to the ConveyedAssets.

####  

### (b)           Notwithstandinganything to the contrary contained in this Agreement or in any other agreementdescribed herein, all risk of loss or damage with respect to the ConveyedAssets shall pass to Purchaser and Purchaser’s Affiliates upon the Closing, andParent and the Asset Selling Corporations shall not be liable for any loss orinjury to the Conveyed Assets thereafter, except as explicitly provided in Article 6hereof.  Purchaser shall, on a datemutually agreed to by Purchaser and Parent, and in any event within thirty (30)days following the Closing, retrieve any tangible Conveyed Assets from Parent’sfacility located at 10700 Bren Road West, Minnetonka, MN.  Parent shall be permitted to retain a copy ofall tangible Conveyed Assets for evidentiary purposes.

###  

### (c)           Parentshall continue to pay and cause to be paid, and perform and discharge when dueor cause to be performed and discharged when due, all Liabilities of Parent andthe Asset Selling Corporations to the extent relating to or arising from theConveyed Assets, arising prior to the Closing and whether accrued or fixed,known or unknown, absolute or contingent, matured or unmatured or determined ordeterminable as of the Closing; *provided**however* that Purchaser (and not the Asset SellingCorporations) hereby assumes and agrees to pay and be responsible, except asexplicitly provided otherwise in Article 6 hereof, for (i) alllawsuits or other proceedings arising after the Closing, solely to the extentresulting exclusively from the use or ownership of the Conveyed Assets on orafter the Closing, and (ii) all Liabilities arising from the

 

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### development, manufacture, distribution or sale of any product by or onbehalf of Purchaser, including warranty obligations (the “AssumedLiabilities”).

###  

### (d)           Notwithstandingany provision in this Agreement or any other writing to the contrary, otherthan the Assumed Liabilities, Purchaser is not assuming any Liabilities of theAsset Selling Corporations, and Parent and/or the other applicable AssetSelling Corporations shall be responsible for the satisfaction or discharge ofsuch Liabilities, including the following (collectively, the “ExcludedLiabilities”):  (i) Liabilitiesresulting from indebtedness for borrowed money; (ii) Liabilities for whichthe Asset Selling Corporations expressly have responsibility pursuant to theterms of this Agreement; (iii) Liabilities associated with the ExcludedAssets; (iv) intercompany Liabilities; (v) except for any Taxesspecifically allocated to Purchaser pursuant to Sections 5.5(a) and5.5(b), any Liability for Taxes of the Asset Selling Corporations, orotherwise imposed on the Conveyed Assets with respect to any Pre-ClosingTaxable Period, including any Liability of the Asset Selling Corporations forthe Taxes of any other Person under Treasury Regulation Section 1.1502-6(or any similar provision of state, local or foreign law), as a transferee orsuccessor, by contract or otherwise; (vi) Liabilities to Employees (itbeing understood that Purchaser is not hiring any Employees in connection withthis Agreement) of or consultants to the Asset Selling Corporations; (vii) Liabilitiesof the Asset Selling Corporations to vendors and suppliers in respect ofclinical studies or other activities relating to the Conveyed Assets; (viii) anyLiability of the Asset Selling Corporations to McAndrews, Held &Malloy, Ltd. (the “McAndrews Firm”) pursuant to (A) the FeeAgreement by and among the McAndrews Firm, Ovion, Inc., William S.Tremulis and Jeffrey P. Callister dated August 16, 2002 and (B) theTermination and Release Agreement by and among the McAndrews Firm, Ovion Inc.and Parent dated September 17, 2009; (ix) any Liabilities of theAsset Selling Corporations arising under the Agreement and Plan of Merger byand among Parent, Oak Merger Corp., Ovion Inc., William S. Tremulis and JeffreyP. Callister, dated June 3, 2005 (the “Merger Agreement”); and (x) anyLiabilities of the Asset Selling Corporations arising under the Settlement,Waiver and Release Agreement by and among Parent, Ovion Inc., W. StephenTremulis, Jeffrey P. Callister, Denise S. Harges, and the Stockholders dated September 1,2009 (the “September 2009 Settlement Agreement”).  For the avoidance of doubt, Purchaser isacquiring solely the Conveyed Assets and is not acquiring any business,operations or product lines from the Asset Selling Corporations.

###  

2.2           Purchase Price.  Inconsideration of the sale and transfer of the Conveyed Assets, Purchaser shallpay to Parent (for itself and as agent for the benefit of the Asset SellingCorporations) at Closing, in accordance with the provisions of this Agreement,Twenty-Three Million Six Hundred Thirty-Four Thousand Dollars ($23,634,000) in cash (the “Purchase Price”),by wire transfer of immediately available funds to an account or accountsdesignated by Parent, which shall be allocated among the Conveyed Assets asdescribed in Section 2.3 below.

 

2.3           Allocation of Purchase Price; Withholding. Parent, the Asset Selling Corporations, and Purchaser have agreed to theallocation of the Purchase Price among the Conveyed Assets as set forth in **Schedule 2.3** (the “Allocation”).  Each of Parent and the Asset SellingCorporations on the one hand and Purchaser on the other shall (a) be boundby the Allocation for purposes of determining any Taxes, (b) prepare andfile, and cause its Affiliates to

 

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prepare and file, its Tax Returns on a basisconsistent with the Allocation, and (c) take no position, and cause itsAffiliates to take no position, inconsistent with the Allocation on anyapplicable Tax Return or in any proceeding before any taxing authority orotherwise; provided, however, that nothing contained herein shall preventPurchaser or the Asset Selling Corporations from settling any proposeddeficiency or adjustment by any taxing authority based upon or arising out ofthe Allocation, and neither Purchaser nor any Asset Selling Corporation shallbe required to litigate before any court any proposed deficiency or adjustmentby any taxing authority challenging such Allocation.  In the event that the Allocation is disputedby any taxing authority, the party receiving notice of the dispute shallpromptly notify the other party hereto concerning resolution of thedispute.  Parent, each of the AssetSelling Corporations, and Purchaser acknowledge that the Allocation was done atarm’s length based upon a good faith estimate of fair market values inaccordance with the requirements of the Code.

 

## 2.4           Closing;Delivery and Payment.

##  

### (a)           TheClosing shall take place at the offices of Fredrikson & Byron, P.A. inMinneapolis, Minnesota at 10:00 A.M., Central time, as of the date firstset forth above, or at such other time and place as the parties shall mutuallyagree.  The date on which the Closingoccurs is called the “Closing Date.” The Closing shall be deemed to occur and be effective as of the close ofbusiness on the Closing Date.

###  

### (b)           Atthe Closing, Parent shall, and, as applicable, shall cause the Asset SellingCorporations to, deliver to Purchaser:

###  

#### (i)            a bill of sale for the Conveyed Assetsthat are tangible personal property, in the form attached hereto as **Exhibit A** (the “Bill of Sale”), executed by theAsset Selling Corporations;

####  

#### (ii)           an assignment agreement for the ConveyedAssets that are intangible personal property, in the form attached hereto as **Exhibit B**, which assignment shall also containPurchaser’s undertaking and assumption of the Assumed Liabilities (the “Assignmentand Assumption Agreement”), executed by the Asset Selling Corporations;

####  

#### (iii)          assignments of Purchased IP Rights, eachexecuted by the applicable Asset Selling Corporations in a form provided byPurchaser prior to Closing;

####  

#### (iv)          copies of the resolutions (or localequivalent) of the board of directors (or local equivalent) of each AssetSelling Corporation authorizing and approving the transactions contemplatedherein; and

####  

#### (v)           copies of releases pursuant to UCC-3’s,as applicable, or otherwise, of all Liens held by CIT Healthcare LLC, asCollateral Agent, with respect to the Conveyed Assets.

####  

### (c)           Atthe Closing, Purchaser shall deliver to the Parent (for itself and as agent forthe benefit of the Asset Selling Corporations):

 

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#### (i)            the Purchase Price and the RoyaltyPayment by wire transfer in immediately available funds to one or more accountsspecified in writing by Parent on or prior to the Closing Date;

####  

#### (ii)           the Assignment and Assumption Agreement,executed by Purchaser; and

####  

#### (iii)          copies of the resolutions of the board ofdirectors or committee thereof of Purchaser authorizing and approving thetransactions contemplated herein.

####  

2.5           License Grant.  Parent, onbehalf of itself and its Affiliates, hereby grants Purchaser the non-exclusive,perpetual, irrevocable, non-transferable (except as specifically set forthbelow), fully-paid, royalty-free right and license, without the right ofsublicense, to the Licensed Patents to use, make, have made, offer to sell,sell and import products (including stents and stent-like devices) fortranscervical sterilization, and to perform procedures for transcervicalsterilization.  Purchaser may nottransfer or assign the license granted in this Section 2.5, in whole or inpart, by operation of law, or otherwise, without the prior written consent ofParent, such consent to be granted or withheld in its sole discretion.  Notwithstanding the foregoing, Purchaser mayassign or transfer this license, in whole but not in part, to an acquiror inany merger, or acquisition or sale of all or substantially all of the assets,of Purchaser, without the prior written consent of Parent.  Purchaser shall provide prompt written noticeto Parent of any such assignment or transfer. For the avoidance of doubt, Parent and its Affiliates make norepresentations or warranties, express or implied, regarding the LicensedPatents, and Parent shall have no obligation or duty to disclose any LicensedPatent to Purchaser, or provide Purchaser with a copy of any LicensedPatent.  For purposes of this Section 2.5,“Licensed Patents” means Patents: (a) that are owned by Parent orits Affiliates on the Closing Date; (b) that have a first effective filingdate on or before the Closing Date; (c) that contain claims that coverproducts (including stents and stent-like devices) for transcervicalsterilization, or procedures for transcervical sterilization; (d) that arenot included in the Conveyed Assets; and (e) for which Parent or itsAffiliate has, as of the Closing Date, the right to grant to Purchaser thelicense set forth in this Section.  Also,for purposes of this Section 2.5, Affiliate shall not include any Personthat was not an Affiliate of Parent as of the Closing Date.

 

# **ARTICLE 3**REPRESENTATIONS AND WARRANTIES OF PARENT

 

Parenthereby represents and warrants to Purchaser that the statements contained inthis Article 3 are true, correct and complete, subject to andexcept as otherwise expressly set forth in this Article 3 or inParent’s Disclosure Schedules attached hereto and incorporated herein byreference (the “Disclosure Schedules”), as of the date hereof.

 

3.1           Organization.  Each Asset SellingCorporation is duly organized, validly existing and in good standing under theLaws of the jurisdiction of its organization.

 

## 3.2           Authority; Binding Effect.

##  

### (a)           EachAsset Selling Corporation has full organizational power and organizationalauthority to carry on their respective businesses as they are now being

 

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### conducted and to own the Conveyed Assets owned by it, and, with respectto Parent, to execute and deliver this Agreement and the Ancillary Agreementsto which it is a party and to perform its obligations hereunder andthereunder.  The execution and deliveryby Parent of this Agreement and the Ancillary Agreements to which it is aparty, and the performance by Parent and the other Asset Selling Corporationsof their respective obligations hereunder and under Ancillary Agreements towhich each is a party, have been duly authorized by all requisite corporate ororganizational action, and no other corporate proceedings are required inconnection with their respective execution, delivery and performance of thisAgreement and the Ancillary Agreements, as applicable.

###  

### (b)           ThisAgreement and the Ancillary Agreements each constitutes a valid and legallybinding obligation of Parent (and of each other Asset Selling Corporation thatis a party thereto), enforceable against it in accordance with its terms,except to the extent that such enforceability may be subject to applicablebankruptcy, insolvency, reorganization, moratorium and similar laws affectingthe enforcement of creditors’ rights generally or by general equitableprinciples.  Notwithstanding any contraryprovision herein, no representation or warranty is made regarding thenon-compete obligations hereunder or the reasonableness thereof.

 

3.3           Noncontravention.  Except as setforth on **Schedule 3.3** of the DisclosureSchedules, the execution, delivery and performance of this Agreement and theAncillary Agreements by Parent and each other Asset Selling Corporation to theextent it is a party thereto, and the consummation of the transactionscontemplated hereby and thereby do not and will not (a) violate anyprovision of the certificate of incorporation, bylaws or other comparableorganizational documents of such Asset Selling Corporation, (b) subject toobtaining the consents, waivers, approvals and authorizations referred to in **Schedule 3.3**, conflict with, or result in the breach of, orconstitute a default under, or result in the termination, cancellation oracceleration (whether after the giving of notice or the lapse of time or both)of any material right or obligation of such Asset Selling Corporation withrespect to the Conveyed Assets under, any agreement, contract, understanding,or other instrument to which such Asset Selling Corporation is a party or towhich its material assets are subject, (c) assuming compliance with thematters set forth in Sections 3.4 and 4.5, materially violate or resultin a material breach of or constitute a material default under any Law or otherrestriction of any court or Governmental Authority to which such Asset SellingCorporation is subject, including any Governmental Authorization, or (d) resultin the creation or imposition of any Lien on any Conveyed Asset, other thanPermitted Encumbrances.

 

3.4           Governmental Consents and Approvals. Except as set forth in **Schedule 3.4** ofthe Disclosure Schedules, the execution, delivery and performance of thisAgreement and the Ancillary Agreements by Parent and the other Asset SellingCorporations that are parties to such agreements, as applicable, do not requireany material consent or approval of any Governmental Authority.

 

3.5           Litigation and Claims.  Except formatters arising in connection with Product Registrations (which are the subjectof Section 3.7), **Schedule 3.5**ofthe Disclosure Schedules sets forth a true, correct and complete list of everycivil, criminal or administrative action, suit, hearing, proceeding orinvestigation pending or, to the Knowledge of Parent, threatened in

 

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writing against any Asset Selling Corporation withrespect to the Conveyed Assets or the transactions contemplated hereby.

 

## 3.6           Compliance with Laws.

##  

### (a)           Exceptfor matters arising in connection with Product Registrations (which are the subjectof Section 3.7) and except as listed on **Schedule 3.6**of the Disclosure Schedules, to the Knowledge of Parent there are,and during the three years preceding the date of this Agreement, there havebeen, no material violations by any Asset Selling Corporation of applicableLaws or Governmental Orders relating to the Conveyed Assets.

###  

### (b)           Tothe Knowledge of Parent, each Asset Selling Corporation possesses all materialpermits, licenses, authorizations, certificates, exemptions and approvals ofGovernmental Authorities (collectively, “Permits”) necessary for theownership of the Conveyed Assets as they are currently owned, and all suchPermits are being complied with by each Asset Selling Corporation in allmaterial respects.

###  

3.7           Product Registrations; Regulatory Compliance.  **Schedule 3.7** of the Disclosure Schedules sets forth, as ofthe date hereof, a list of all licenses and approvals granted to the AssetSelling Corporations with respect to the Conveyed Assets by or pending with anyGovernmental Authority to market any product (the “Product Registrations”).  Except as set forth in **Schedule 3.7**of the Disclosure Schedules, an Asset Selling Corporation is the sole andexclusive owner of the Product Registrations and has not granted any materialright of reference with respect thereto.

 

## 3.8           MaterialContracts.

##  

### (a)           **Schedule 3.8(a) **of the Disclosure Schedules lists each of thefollowing Contracts to which Parent and any other Asset Selling Corporation isa party, in each case relating primarily or exclusively to the field oftranscervical sterilization or to the Conveyed Assets (such contracts andagreements being “Material Contracts”):

###  

#### (i)            each Contract for the purchase ofinventory, or other personal property with any supplier or for the furnishingof services extending beyond twelve (12) months or the terms of which providefor purchases thereunder in excess of $10,000 on an annual basis;

####  

#### (ii)           all broker, distributor, dealer,manufacturer’s representative, franchise and agency Contracts;

####  

#### (iii)          all Contracts relating to indebtednessfor borrowed money, factoring arrangements, sale and leaseback transactions,deferred purchase price of property and other similar financing transactionswith respect to which an Asset Selling Corporation is an obligor;

####  

#### (iv)          all licenses and other Contracts relatingto the Purchased IP Rights that require the payment of a royalty or a licensefee, as well as all research and development Contracts pursuant to which anyPerson has been granted any license under,

 

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#### or otherwise hasreceived or acquired any right (whether or not currently exercisable) orinterest in, any Purchased IP Rights;

####  

#### (v)           all Contracts limiting the freedom of anyAsset Selling Corporation to own or use the Conveyed Assets;

####  

#### (vi)          all Contracts with a GovernmentalAuthority;

####  

#### (vii)         each joint venture or similar agreement;and

####  

#### (viii)        all Contracts entered into since January 1,2009 providing for the acquisition or disposition of any Conveyed Assets.

####  

### (b)           Exceptas disclosed in **Schedule 3.8(b) **of theDisclosure Schedules, (i) the Termination and Release Agreement by andamong the McAndrews Firm, Ovion Inc. and Parent dated September 17, 2009and the September 2009 Settlement Agreement are valid and binding on eachAsset Selling Corporation that is a party thereto, and, to the Knowledge ofParent, on each other party thereto, and are in full force and effect; and (ii) nosuch Asset Selling Corporation is in material breach of, or default under, suchagreements to which it is a party.

###  

### (c)           Notwithstandinganything in this Agreement to the contrary, none of the Asset SellingCorporations makes any representation or warranty regarding the effectivenessof any assignment or partial assignment, as applicable, or enforceability byPurchaser or its Affiliates, of any Assumed Contract.

###  

## 3.9           Intellectual Property.

##  

### (a)           ThePurchased IP Rights listed on **Schedule 3.9(a) **constituteall patents, patent applications, registered trademarks, trademarkapplications, trademark registrations, registered copyrights, copyrightapplications and copyright registrations that are owned (whether exclusively,jointly with another Person, or otherwise) by an Asset Selling Corporation, orfor which an Asset Selling Corporation has a belief that it has an ownershipinterest in, and which: (i) were licensed to the Purchaser under theSettlement and License Agreement by and among Ovion Inc., William S. Tremulisand Jeffrey P. Callister and Conceptus, Inc., effective October 23,2003 (the “Settlement and License Agreement”); (ii) were acquiredby Parent under the Agreement and Plan of Merger by and among American MedicalSystems, Inc., Oak Merger Corp., Ovion Inc., William S. Tremulis andJeffrey P. Callister, dated June 3, 2005; or (iii) have been developedor acquired by an Asset Selling Corporation or any other Affiliate of Parentfor use primarily in stents for transcervical sterilization or stent-likedevices for transcervical sterilization (collectively, the “Registered IP”).  For each such listed item of Registered IP, **Schedule 3.9(a) **shall specify the jurisdiction in whichsuch item of intellectual property has been registered or filed, if applicable,and the applicable application, registration or serial number.  Parent has provided to Purchaser complete andaccurate copies (either physical or via access) of all non-published patentapplications included in the Registered IP.

 

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### (b)           **Schedule 3.9(b) **accurately identifies as of the date of this Agreement(i) all Intellectual Property or Technology licensed to the Asset SellingCorporations and relating primarily to the Conveyed Assets (other than anynon-customized software that (A) is so licensed solely in executable orobject code form pursuant to a nonexclusive, internal use software license, (B) isnot used directly in the development or manufacturing of the products of theBusiness, and (C) is generally available on standard terms for less than$15,000), (ii) the corresponding Contract or Contracts pursuant to whichsuch Intellectual Property or Technology is licensed to the Asset SellingCorporations, and (iii) whether the licenses granted are exclusive.  Except pursuant to the licenses listed in **Schedule 3.9(b)**, the Asset Selling Corporations do not haveany obligation to compensate or account to any Person for the use of any of thePurchased IP Rights. No Person who has licensed Intellectual Property orTechnology to the Asset Selling Corporations for use in the Conveyed Assets hasownership rights or license rights to improvements made by the Asset SellingCorporations in such Intellectual Property or Technology.

###  

### (c)           **Schedule 3.9(c) **accurately identifies as of the date of this Agreementeach Contract pursuant to which any Person has been granted any license under,or otherwise has received or acquired any right (whether or not currentlyexercisable) or interest in, any Purchased IP Rights.  The Asset Selling Corporations are not boundby, and no Purchased IP Rights are subject to, any Contract containing anycovenant or other provision that in any way limits or restricts the ability ofthe Asset Selling Corporations to use, exploit, assert, or enforce anyPurchased IP Rights anywhere in the world. The Asset Selling Corporations have not transferred ownership of(whether a whole or partial interest), or granted any exclusive right to use,any of the Purchased IP Rights to any Person.

###  

### (d)           TheAsset Selling Corporations exclusively own all right, title, and interest toand in the Registered IP free and clear of any Liens, other than PermittedEncumbrances.

###  

### (e)           TheAsset Selling Corporations exclusively own all right, title, and interest toand in, or have the transferable right to use in stents for transcervicalsterilization or stent-like devices for transcervical sterilization, allTechnology included in the Purchased IP Rights free and clear of any Liens,other than Permitted Encumbrances.  EachPerson who is or was an employee, officer, director or contractor of the AssetSelling Corporations and who is or was involved in the creation or developmentof any Purchased IP Rights has signed an enforceable agreement containing anassignment to the Asset Selling Corporations of all Intellectual Property insuch individual’s or entity’s contribution to the Purchased IP Rights.  Without limiting the foregoing, the PurchasedIP Rights have been:  (i) developedby employees of the Asset Selling Corporations within the scope of their employment;(ii) developed by independent contractors who have assigned their rightsin the Purchased IP Rights to the Asset Selling Corporations pursuant toenforceable written agreements; or (iii) otherwise acquired by the AssetSelling Corporations from a third party who has assigned all ownership of allPurchased IP Rights it has developed on the Asset Selling Corporation’s behalfto the Asset Selling 

 

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### Corporations.  Without limitingthe foregoing, William S. Tremulis and Jeffrey P. Callister have each assignedall right, title and interest in and to the Purchased IP Rights.

###  

### (f)            TheRegistered IP has the status indicated on **Schedule3.9(a)**.  **Schedule 3.9(f) **setsforth a listing of all registrations, filings and payment obligations for theRegistered IP due to be made to any Governmental Authority within sixty (60)days following the Effective Date.  TheAsset Selling Corporations and, to the knowledge of the Asset SellingCorporations, their patent counsel, have complied with their duty of candor anddisclosure to the applicable Governmental Authorities with respect to allPatents included in the Purchased IP Rights and have made no materialmisrepresentations in the applicable patent filings.

###  

### (g)           Nofunding, facilities, or personnel of any governmental entity or educationalinstitution were used, directly or indirectly, to develop or create, in wholeor in part, any of the Purchased IP Rights that would impair an Asset SellingCorporation’s control of the Purchased IP Rights or would grant licenses tosuch entity or institution.  The AssetSelling Corporations have not made any submission or suggestion to, and are notsubject to any agreement with, any standards bodies or other entities thatwould obligate the Asset Selling Corporations to grant licenses to or otherwiseimpair its control of the Purchased IP Rights.

###  

### (h)           Noproceedings, claims or actions have been instituted or are pending against theAsset Selling Corporations, or, to the Knowledge of Parent, are threatened,that challenge the right of the Asset Selling Corporations with respect to theuse or ownership of the Purchased IP Rights. Without limiting the foregoing, no interference, opposition, reissue orreexamination proceeding is pending, or to the Knowledge of Parent threatened,in which the scope, validity, or enforceability of any of Purchased IP Rightsis being contested or challenged.  TheAsset Selling Corporations have not received any written notice alleging (i) theinvalidity of any of the Purchased IP Rights, or (ii) the infringement,misappropriation or breach of any Intellectual Property rights of others by theAsset Selling Corporations relating to stents for transcervical sterilizationor stent-like devices for transcervical sterilization.  The Purchased IP Rights are not subject toany outstanding judgment, decree, order, writ, award, injunction ordetermination of an arbitrator or court or other Governmental Authority (otherthan the U.S. or other national patent office) affecting the rights of theAsset Selling Corporations with respect thereto.

###  

### (i)            Neitherthe execution, delivery, or performance of this Agreement nor the consummationof any of the transactions or agreements contemplated by this Agreement will,with or without notice or the lapse of time, result in, or give any otherPerson the right or option to cause or declare, (i) a loss of, or Lien on,any Purchased IP Rights; or (ii) a breach of, termination of, oracceleration or modification of any right or obligation under any Contractlisted in **Schedules 3.9(b)**; or (iii) thegrant, assignment, or transfer to any other Person of any license or otherright or interest under, to, or in any of the Purchased IP Rights.

###  

3.10        Assets.  Each AssetSelling Corporation owns, leases or has the legal right to use all of itsConveyed Assets.  Each Asset SellingCorporation has good and marketable title to (or

 

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in the case of leased Conveyed Assets, valid leaseholdinterests in) all its Conveyed Assets except for Permitted Encumbrances.

 

3.11        Taxes.  Except as setforth in **Schedule 3.11** of the DisclosureSchedules, (a) all Tax Returns that are required to be filed on or beforethe date hereof by or on behalf of the Asset Selling Corporations with respectto the Conveyed Assets have been filed, (b) all Taxes (whether or notshown to be due and payable on such Tax Returns) have been paid and (c) noAsset Selling Corporation is currently the beneficiary of any extension of timewithin which to file any such Tax Returns. There are no Tax Liens upon any of the Conveyed Assets, except forPermitted Encumbrances.  Except as setforth on **Schedule 3.11** of the DisclosureSchedules, no Tax Return that includes any of the Asset Selling Corporationswith respect to the Conveyed Assets is currently being examined by any taxingauthority, and there are no outstanding agreements or waivers extending thestatute of limitations applicable to any such Tax Return.

 

3.12        Brokers.  No broker,finder or investment banker is entitled to any brokerage, finder’s or other feeor commission in connection with the transactions contemplated by thisAgreement based upon arrangements made by or on behalf of Parent or itsAffiliates.

# ** **

# **ARTICLE 4**

# **REPRESENTATIONS AND WARRANTIES OF PURCHASER**

# ** **

Purchaserhereby represents and warrants to Parent that the statements contained in this Article 4are true, correct and complete, except as otherwise expressly set forth in thisArticle 4 or in the referenced schedules attached hereto andincorporated herein by reference, as of the date hereof.

 

4.1          Organization and Qualification. Purchaser is a corporation duly organized, validly existing and in goodstanding under the Laws of the jurisdiction of its incorporation.

 

4.2          Corporate Authorization.  Purchaser hasfull corporate power and authority to execute and deliver this Agreement andthe Ancillary Agreements to which it is a party, and to perform its obligationshereunder and thereunder.  The execution,delivery and performance by Purchaser of this Agreement and the AncillaryAgreements to which it is a party have been duly authorized by all requisitecorporate action on the part of Purchaser and no other corporate proceedings onthe part of Purchaser are required in connection with the execution, deliveryand performance by Purchaser of this Agreement and the Ancillary Agreements, asapplicable.

 

4.3          Binding Effect.  ThisAgreement and Ancillary Agreements to which it is a party, constitute a validand legally binding obligation of Purchaser, enforceable against Purchaser inaccordance with its terms, except to the extent that such enforceability may besubject to applicable bankruptcy, insolvency, reorganization, moratorium andsimilar laws affecting the enforcement of creditors’ rights generally or bygeneral equitable principles.

 

4.4          Noncontravention.  Theexecution, delivery and performance by Purchaser of this Agreement and theAncillary Agreements, and the consummation of the transactions contemplatedhereby and thereby, do not and will not (a) violate any provision of thecertificate of incorporation, bylaws or other organizational documents ofPurchaser, or (b) assuming compliance with the matters set forth in Sections3.4 and 4.5, violate or result in a breach of or

 

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constitute a default under any Law or otherrestriction of any court or Governmental Authority to which Purchaser issubject, including any Governmental Authorization.

 

4.5          Consents and Approvals.  Other than asset forth in **Schedule 4.5**, the execution anddelivery of this Agreement and the Ancillary Agreements by Purchaser do not andwill not, require any material consent or approval of any GovernmentalAuthority.

 

4.6          Brokers.  No broker,finder or investment banker is entitled to any brokerage, finder’s or other feeor commission in connection with the transactions contemplated by thisAgreement and the Ancillary Agreements based upon arrangements made by or onbehalf of Purchaser or its Affiliates, and in no way will any such fees orexpenses be deemed an Excluded Asset or Excluded Liability.

 

# **ARTICLE 5**

# **COVENANTS AND OTHER AGREEMENTS**

# ** **

## 5.1          Further Assurances.

##  

### (a)           Subjectand in addition to Section 2.1(b), at any time after the ClosingDate, Parent shall, and, as applicable shall cause the other Asset SellingCorporations to, execute, acknowledge and deliver any further deeds,assignments, conveyances and other assurances and documents and instruments oftransfer reasonably requested by Purchaser and necessary for Parent to complywith its covenants contained herein and, at Purchaser’s expense, will take anyaction consistent with the terms of this Agreement that may reasonably berequested by Purchaser for the purpose of assigning, transferring, granting,conveying, vesting and confirming ownership in or to Purchaser, or reducing toPurchaser’s possession, any or all of the Conveyed Assets.

###  

### (b)           If,after the Closing Date, Parent determines that any Technology (for useprimarily in (i) stents for transcervical sterilization, or (ii) stent-likedevices for transcervical sterilization) that it owned on the Closing Date wasnot included in the Conveyed Assets, then Parent shall promptly notifyPurchaser of such determination, and, subject to Section 5.1(d),amend **Schedule 2.1(a)(ii) **to includesuch Technology, assign any rights in such Technology to Purchaser, andpromptly deliver such Technology to Purchaser (in a manner consistent with theassignment and delivery at Closing). Subject to Section 5.1(a), the amendment of **Schedule 2.1(a)(ii) **and delivery of the Technology (andassignment of rights in such Technology) as set forth above shall be Purchaser’ssole remedy with respect to the omission of any such Technology from theConveyed Assets.

###  

### (c)           If,after the Closing Date, Parent determines that any Registered IP owned by theAsset Selling Corporations on the Closing Date that should have been includedin the Conveyed Assets because it complied with the definition of Registered IPset forth in Section 3.9(a) was not included in the Conveyed Assetsat the Closing, or if Purchaser notifies Parent that any such Registered IPshould have been included in the Conveyed Assets and the parties following goodfaith, reasonable discussions agree that such Registered IP should have beenincluded in the Conveyed Assets, then, subject to Section 5.1(d),the parties shall promptly amend **Schedule 2.1(a)(ii) **and**Schedule 3.9(a) **to

 

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### include such Registered IP and Parent shall assign any rights in suchRegistered IP to Purchaser and promptly deliver all applicable documentationand files in its possession or control relating to such Registered IP (in amanner consistent with the assignment and delivery at Closing).  Subject to Section 5.1(a), theamendment of **Schedule 2.1(a)(ii) **as setforth above, assignment of ownership, and delivery of documentation and filesshall be Purchaser’s sole remedy with respect to the omission of any suchRegistered IP from the Conveyed Assets.

###  

### (d)           Ifthe amendment, assignment or delivery described in this Section 5.1requires the release or waiver of Liens or restrictions encumbering the assetsto be so assigned or delivered, Parent shall use its commercially reasonableefforts to obtain such release or waiver as soon as practicable, and suchamendment, assignment and/or delivery shall occur promptly after such releaseor waiver is obtained.

###  

5.2          Purchaser’s Investigation; No AdditionalRepresentations.Purchaser acknowledges and agrees that, except as specifically set forth in Article 3of this Agreement, Parent has not made and shall have no Liability for anyrepresentation or warranty, express or implied, in connection with thetransactions contemplated by this Agreement, including any representation orwarranty as to the accuracy or completeness of any information regarding theConveyed Assets and/or the Asset Selling Corporations furnished to Purchaser orits representatives in connection with Purchaser’s due diligence review of theConveyed Assets and/or the Asset Selling Corporations.  Without limiting the generality of theforegoing, except as specifically set forth in Article 3 of thisAgreement, neither Purchaser nor any Purchaser Indemnified Parties shall haveany claim or right to recovery pursuant to Article 6 or otherwise,and none of Parent, the Seller Indemnified Parties or any other Person shallhave or be subject to any liability to Purchaser, any of the PurchaserIndemnified Parties or any other person, with respect to (i) anyinformation, documents or materials furnished, delivered or made available bythe Asset Selling Corporations or their Affiliates, officers, directors,employees, agents or advisors to Purchaser or its Affiliates, in certain “datarooms,” management presentations or any other form in contemplation of thetransactions contemplated hereby, including the confidential memoranda and/orother information prepared or delivered by Parent and any of its advisors, or (ii) anyprojections, forecasts, estimates, plans or budgets of future revenue, expensesor expenditures, future results of operations (or any component thereof),future cash flows (or any component thereof) or future financial condition (orany component thereof) of the Conveyed Assets or the future business,operations or affairs of the Conveyed Assets heretofore or hereafter deliveredto or made available to Purchaser or its representatives or Affiliates.

 

5.3          Bulk Transfer Laws.  Purchaseracknowledges that the Asset Selling Corporations have not taken, and do notintend to take, any action required to comply with any applicable bulk sale orbulk transfer Laws or similar Laws and Purchaser waives the Asset SellingCorporations’ compliance with such Laws.

 

5.4          Litigation Support.  Purchaser andits Affiliates on the one hand and Parent and its Affiliates on the other handwill cooperate with each other in the defense or settlement of any lawsuitinvolving the Conveyed Assets for which they have responsibility by providingthe other party and such other party’s legal counsel and other Personsreasonable access to then current employees, records, documents, data,equipment, facilities, products, parts, prototypes and other

 

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information regarding the Conveyed Assets or the statusof material litigation issues as such other party may reasonably request, tothe extent maintained or under the possession or control of the requestedparty.  The parties shall use theirreasonable best efforts to seek confidentiality agreements with respect to anysettlements of such lawsuits if reasonably requested hereunder.  The requesting party shall reimburse theother party for its reasonable expenses in performing its obligations underthis Section 5.4.

 

## 5.5          Tax Matters.

##  

### (a)           Notwithstandingany other provisions of this Agreement to the contrary, all transfer,documentary, recording, sales, use, registration, stamp, value-added and othersimilar Taxes (including all applicable real estate transfer Taxes, butexcluding any Income Taxes) together with any notarial and registry fees andrecording costs imposed by any Tax authority or other Governmental Authority inconnection with the transfer of the Conveyed Assets will be shared equallybetween Purchaser and Parent, regardless of what Person is obligated to paysuch Taxes under applicable Law.  Theparties and their respective Affiliates will cooperate in timely preparing andfiling all Tax Returns that may be required to comply with Law relating to suchTaxes.  To the extent that one partyclaims any exemptions from any such Taxes (it being understood that each partyshall claim any such exemptions available to it), such party shall provide tothe other party the appropriate exemption certificates.  For clarity, Purchaser shall be solelyresponsible for any and all fees associated with the recording of theassignment of the Purchased IP Rights in any national patent or trademarkoffice.

###  

### (b)           Theparties will make payments to each other to the extent necessary so that theAsset Selling Corporations shall bear the cost of personal property and othersimilar Taxes imposed on the Conveyed Assets which are due and payable duringthe Tax periods ending prior to or on the Closing Date (and, with respect toany Straddle Taxable Period, on a per diem basis up to and including theClosing Date) and Purchaser shall bear the cost of real property, personalproperty, and other similar Taxes imposed on the Conveyed Assets which are dueand payable during Tax periods ending after the Closing Date (and, with respectto any Straddle Taxable Period, on a per diem basis following the ClosingDate), such payments to be made as soon as practicable after the Closing ineach case after the amount of such Taxes has been determined.  For purposes of this Agreement, “StraddleTaxable Period” means any Taxable period beginning before the Closing Dateand ending on or after the Closing Date.

###  

### (c)           Eachof the parties and their Affiliates shall provide the other party with suchinformation and records and make such of its officers, directors, employees andagents available as may reasonably be requested by such other party inconnection with the preparation of any Tax Return or any audit or otherproceeding that relates to the Conveyed Assets.

###  

5.6          Trademarks; Names.  From andafter the Closing, Purchaser shall not, and shall ensure that its employees andrepresentatives do not, represent itself or themselves as Parent or asemployees or representatives of any of the Asset Selling Corporations.  Purchaser shall take appropriate action toremove, cease to use and/or cover the “American Medical Systems” name

 

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and logo, and those certain names, logos and markslisted on **Schedule 1.1(a) **hereto, from allmaterials (including invoices, packaging and other promotional material),signage, telephone listings, letterhead, and other similar materials anddocumentation used in connection with the Conveyed Assets. The Asset SellingCorporations shall take appropriate action to remove, cease to use and/or coverthe “Ovion” name and logo from all of its materials (including invoices,packaging and other promotional material), signage, telephone listings,letterhead, and other similar materials and documentation.

 

## 5.7          Non-Compete.

##  

### (a)           Fora period of five (5) years from the Closing Date (the “RestrictedPeriod”), Parent shall not, and shall cause its Affiliates not to, directlyor indirectly, own, manage, operate, control or significantly participate inthe ownership, management, operation, or control of any business endeavorengaged in the research, development, testing, manufacturing, marketing orselling of products in the field of permanent female sterilization (the “RestrictedBusiness”).

###  

### (b)           Fora period of four (4) years after the Restricted Period, Parent shall not,and shall cause its Affiliates not to, directly or indirectly, own, manage,operate, control or significantly participate in the ownership, management,operation, or control of any business endeavor engaged in the research,development, testing, manufacturing, marketing or selling of permanentfemale sterilization products consisting of a stent-like device deliveredtranscervically using a catheter.

###  

### (c)           Notwithstandingthe foregoing, if at any time all or substantially all of Parent’s business isacquired by, sold, or otherwise transferred, regardless of the legal form ofsuch transaction or series of transactions, the restrictions contained in this Section 5.7shall not apply to or in any way restrict the purchaser or transferee, Parentor their respective Affiliates with respect to the products that such Person isresearching, developing, testing, manufacturing, marketing or sellingimmediately prior to the consummation of the acquisition, sale or othertransfer of Parent’s business; provided, however, that nothing in this Section 5.7shall be interpreted as granting any Asset Selling Corporation or any successorentity a license in or to any of the Purchased IP Rights.

###  

5.8          Assignment and Assumption of the Settlement andLicense Agreement.  Pursuant to Section 11.4 of theSettlement and License Agreement, Parent shall cause Ovion Inc. to assign itsrights and delegate its duties under the Settlement and License Agreement toPurchaser, and the parties hereby agree that all rights to receive royalties,and other rights granted to Ovion Inc., a wholly-owned subsidiary of Parent,are hereby immediately and automatically terminated and of no further force oreffect.  Notwithstanding the foregoing, (a) thereleases contained in Sections 4.1 and 4.2 of the Settlement and LicenseAgreement are unaffected by this Section 5.8 and remain in fullforce and effect; and (b) Purchaser shall pay to Ovion Inc. at the Closinga royalty payment in the amount of Eight Hundred Sixty Six Thousand Dollars($866,000) in cash (the “Royalty Payment”) by wire transfer ofimmediately available funds to an account or accounts designated byParent.  Ovion Inc.’s duties under theSettlement and License Agreement shall be Assumed Liabilities hereunder and theSettlement and License Agreement shall be an

 

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Assumed Contract hereunder.  Parent, on its own behalf and on behalf ofits Affiliates, expressly acknowledges and agrees that this Agreement(including Purchaser’s payment of the Royalty Payment at the Closing) satisfiesany and all payment obligations of Purchaser under the Settlement and LicenseAgreement, including any obligation of Purchaser to make any royalty paymentfor the period ended September 30, 2009. Parent, on its own behalf and on behalf of its Affiliates, herebyirrevocably, perpetually and forever releases and discharges Purchaser and itsAffiliates from any and all claims and Liabilities of any nature, in each casewhether known or unknown, arising out of the Settlement and LicenseAgreement.  Purchaser, on its own behalfand on behalf of its Affiliates, hereby irrevocably, perpetually and foreverreleases and discharges Parent and its Affiliates from any and all claims andLiabilities of any nature, in each case whether known or unknown, arising outof the Settlement and License Agreement. In connection with the foregoing, Parent and Purchaser, each on its ownbehalf and on behalf of its respective Affiliates, each expressly waives and relinquishes all rightsand benefits, if any, arising under the provisions of Section 1542 of theCalifornia Civil Code, which provides as follows:

 

**“A general release does not extend to claims whichthe creditor does not know or suspect to exist in his or her favor at the timeof executing the release, which if known by him or her must have materiallyaffected his or her settlement with the debtor.”**

 

# **ARTICLE 6**

# **SURVIVAL AND INDEMNIFICATION**

# ** **

6.1          Survival.  Therepresentations and warranties contained in this Agreement shall survive theClosing until the date eighteen (18) months following the Closing Date, and noparty may first raise a claim based thereon for any Losses (defined below)after the expiration of such eighteen (18)-month period not directly related toor arising out of a claim asserted by such party in writing and received by theother party prior to the expiration of such eighteen(18)-month period.  Any breach of a representation or warranty inrespect of which indemnity may be sought pursuant to the terms of thisAgreement shall survive the time at which it would otherwise terminate pursuantto the preceding sentence, if written notice, in the manner provided forherein, of the inaccuracy thereof giving rise to such right of indemnity shallhave been given to the party against whom such indemnity is sought hereunderprior to such time.

 

## 6.2          Indemnification by Purchaser.

##  

### (a)           Purchaserhereby agrees that it shall indemnify, defend (as provided herein) and holdharmless the Asset Selling Corporations, their Subsidiaries, Affiliates, and,if applicable, their respective directors, officers, shareholders, partners,attorneys, accountants, agents and employees and their heirs, successors andassigns (the “Seller Indemnified Parties”) from, against and in respectof any damages, claims, losses, charges, actions, suits, proceedings,deficiencies, interest, penalties, and reasonable costs and expenses (includingreasonable attorneys’ and consultants’ fees) (collectively, “Losses”)imposed on, sustained, incurred or suffered by or asserted against any of theSeller Indemnified Parties by reason of (i) any breach of anyrepresentation or warranty made by Purchaser contained in this Agreement; (ii) thebreach of any covenant or

 

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### agreement of Purchaser contained in this Agreement; (iii) theAssumed Liabilities and (iv) the ownership of and activities involving theConveyed Assets from and after the Closing.

###  

### (b)           Notwithstandingthe provisions of this Article 6, Purchaser shall not be liable tothe Seller Indemnified Parties for any Losses with respect to the matterscontained in Section 6.2(a)(i) except to the extent the Lossestherefrom exceed $470,000, in which event Purchaser shall be liable to theSeller Indemnified Parties for all such Losses in excess of such amount, up toan aggregate amount equal to $3,550,000; it being understood that (i) theforegoing limitations shall not apply to (x) Losses under Section 6.2(a)(ii),(iii) or (iv) or (y) Losses to the extent resulting fromfraud and (ii) the cap for Losses arising from breaches of Section 4.2shall be the Purchase Price instead of $3,550,000.  In no event shall Purchaser be liable to theSeller Indemnified Parties for Losses exceeding, in the aggregate, the PurchasePrice.

###  

## 6.3          Indemnification by Parent.

##  

### (a)           Parenthereby agrees that it shall indemnify, defend (as provided herein) and holdharmless Purchaser, its Affiliates and, if applicable, their respectivedirectors, officers, shareholders, partners, attorneys, accountants, agents andemployees and their heirs, successors and assigns (the “PurchaserIndemnified Parties” and, collectively with the Seller Indemnified Parties,the “Indemnified Parties”) from, against and in respect of any Lossesimposed on, sustained, incurred or suffered by or asserted against any of thePurchaser Indemnified Parties by reason of (i) any breach of anyrepresentation or warranty made by Parent contained in this Agreement; (ii) thebreach of any covenant or agreement of an Asset Selling Corporation made inthis Agreement; and (iii) the Excluded Liabilities; provided, however,that, notwithstanding the foregoing, the Purchaser Indemnified Parties’ soleremedy with respect to the omission of any Technology or Registered IP from theConveyed Assets shall be as set forth in Section 5.1.

###  

### (b)           Notwithstandingthe provisions of this Article 6, Parent shall not be liable to thePurchaser Indemnified Parties for any Losses with respect to the matterscontained in Section 6.3(a)(i) except to the extent the Lossestherefrom exceed $470,000, in which event Parent shall be liable to thePurchaser Indemnified Parties for all such Losses in excess of such amount, upto an aggregate amount equal to $3,550,000; it being understood that (i) theforegoing limitations shall not apply to (x) Losses under Section 6.3(a)(ii) or(iii) or (y) Losses to the extent resulting from fraud and (ii) thecap for Losses arising from breaches of Sections 3.2(a) and 3.9(d) shallbe the Purchase Price instead of $3,550,000. In no event shall Parent be liable to the Purchaser Indemnified Partiesfor Losses exceeding, in the aggregate, the Purchase Price.

###  

6.4          Indemnification Procedures. In the event that any claim or demand by a third party for which anindemnifying party, Parent or Purchaser, as the case may be (an “IndemnifyingParty”), may be liable to any Indemnified Party hereunder (a “Claim”)is asserted against or sought to be collected from any Indemnified Party by athird party, such Indemnified Party shall as promptly as practicable notify theIndemnifying Party in writing of such Claim and

 

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the amount or the estimated amount thereof and suchnotice shall state with reasonable specificity the basis, if known, under whichthe claim is made (the “Claim Notice”). The failure on the part of the Indemnified Party to give any such ClaimNotice in a reasonably prompt manner shall not relieve the Indemnifying Partyof any indemnification obligation hereunder unless, and only to the extentthat, the Indemnifying Party is materially prejudiced thereby.  The Indemnifying Party shall have forty-five(45) days from the delivery of the Claim Notice (the “Notice Period”) tonotify the Indemnified Party (a) whether or not the Indemnifying Partydisputes the liability of the Indemnifying Party to the Indemnified Partyhereunder with respect to such Claim and (b) whether or not it desires todefend the Indemnified Party against such Claim; any failure to so notify theIndemnified Party within such 45-day period shall be deemed an agreement thatthe Indemnified Party shall have the sole power to direct and control thedefense of such Claim.  Except ashereinafter provided, in the event that the Indemnifying Party notifies theIndemnified Party within the Notice Period that it desires to defend theIndemnified Party against such Claim, the Indemnifying Party shall have theright to defend the Indemnified Party by appropriate proceedings and shall havethe sole power to direct and control such defense.  Notwithstanding the foregoing, theIndemnified Party, during the period the Indemnifying Party is determiningwhether to elect to assume the defense of a matter covered by this Section 6.4,may take such reasonable actions as it deems necessary to preserve any and allrights with respect to the matter, without such actions being construed as awaiver of the Indemnified Party’s rights to defense and indemnificationpursuant to this Agreement.  TheIndemnified Party shall not settle a Claim for which it is indemnified by theIndemnifying Party without the prior written consent of the Indemnifying Party,unless the Indemnifying Party elects not to defend the Indemnified Partyagainst such Claim.  In any event, theIndemnified Party shall have the sole right to defend, settle or compromise anyClaim with respect to which it has agreed in writing to waive its right toindemnification pursuant to this Agreement with respect to attorneys’ andconsultants’ fees and 50% of the amount of any settlement or judgment inconnection with such Claim.  To theextent the Indemnifying Party shall direct, control or participate in thedefense or settlement of any third party Claim or demand, the Indemnified Partywill give the Indemnifying Party and its counsel access to, during normalbusiness hours, the relevant business records and other documents, and shallpermit them to consult with the employees and counsel of the IndemnifiedParty.  The Indemnified Party shall useits commercially reasonable best efforts in the defense of all claimshereunder.  Any dispute regarding theobligation of a party hereto to indemnify, defend and hold harmless anotherparty with respect to a claimed Loss shall be resolved by appropriate legalproceedings, which may remain pending during or after the defense of suchclaimed Loss.  Notwithstanding any of theforegoing, with respect to any Claims regarding the ownership, validity, orscope of the Purchased IP Rights for which Purchaser seeks indemnificationunder this Agreement: (y) Purchaser shall control all correspondence with,and any legal or other proceedings before, any Governmental Authority (otherthan judicial authority), such as by way of example only, the United StatesPatent and Trademark Office, and Parent’s indemnification obligations inconnection with such Claim shall be limited to 50% of the amount of attorneys’and consultants’ fees incurred by Purchaser in such proceedings; and (z) inthe course of Parent’s defense or settlement of such Claims by third partieswith respect to which Parent is controlling the defense hereunder, Parent maynot settle or compromise any Claim, or make any admission or stipulation, thataffects the scope, validity, ownership, license or control of any Purchased IPRights, without the specific prior written consent of Purchaser on acase-by-case basis, such

 

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consent not to be unreasonably conditioned, delayed orwithheld; provided, that if Purchaser conditions or withholds consent,Purchaser shall assume control with respect to such Claim, and Parent’sindemnification obligations in connection with such Claim shall be limited to50% of the amount of further attorneys’ and consultants’ fees incurred byPurchaser in such action and 50% of the amount of any settlement or judgment inconnection with such Claim.  In anyevent, the Indemnifying Party’s liability hereunder shall be subject to thelimitations set forth in Sections 6.2(b) and 6.3(b).

 

6.5          Exclusive Remedy; Limitation of Remedy. The parties agree that the sole and exclusive remedy with respect to anyand all claims relating to the subject matter of this Agreement, except to theextent set forth in Sections 5.1 and 7.2, and the transactionscontemplated hereby shall be pursuant to the indemnification provisions setforth in this Article 6, whether arising in contract, tort orotherwise.

 

6.6          Characterization of Indemnification Payments. All amounts paid by Parent or Purchaser to the other under this Article 6shall be treated for all Tax purposes as adjustments to the Purchase Price.

 

6.7          Computation of Losses Subject to Indemnification. The amount of any Loss for which indemnification is provided under this Article 6or otherwise in this Agreement shall be computed net of any insurance proceedswhen actually received by the Indemnified Party (less its reasonable costs ofenforcing the insurance) from the Indemnifying Party’s insurance carrier(s);provided that such indemnification amounts shall be paid when due pursuant tothe terms hereof and the Indemnified Party, upon receipt of such proceeds,shall transfer to the Indemnifying Party the entire amount of such proceeds.

 

6.8          Limitations on Liability. Notwithstanding any provision herein, neither Parent and/or any of theAsset Selling Corporations, on the one hand, nor Purchaser, on the other hand,shall in any event be liable to the other party or such party’s Affiliates,officers, directors, employees, stockholders, agents or representatives onaccount of any indemnification obligation set forth in this Article 6for any indirect, consequential, special, incidental or punitive damages(including, lost profits, damage to goodwill or loss of business) except ifheld responsible for such by third parties.

 

6.9          Mitigation.  AnIndemnified Party will use commercially reasonable efforts to mitigate theLosses to which it may become entitled to indemnification hereunder.

 

6.10        Waiver of Conditions; Indemnity. The parties acknowledge and agree that if Purchaser has actual knowledgeof any breach by Parent of any representation, warranty or covenant containedin this Agreement, and Purchaser proceeds with the Closing, Purchaser shall bedeemed to have waived such breach and Purchaser and any and all of thePurchaser Indemnified Parties shall not be entitled to be indemnified by Parentunder Section 6.3 above, to sue for damages or to assert any otherright or remedy for losses arising from any matters relating to such breach,notwithstanding anything to the contrary contained in this Agreement or in any certificatedelivered pursuant hereto.

 

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# **ARTICLE 7**

# **MISCELLANEOUS**

# ** **

7.1           Notices.  All noticesor other communications hereunder shall be deemed to have been duly given andmade if in writing and if served by personal delivery upon the party for whomit is intended, if delivered by registered or certified mail, return receiptrequested, or by a national courier service, or if sent by facsimile, providedthat the facsimile is promptly confirmed by confirmation of transmissionthereof, to the person at the address set forth below, or such other address asmay be designated in writing hereafter, in the same manner, by such person:

 

To Parent:

 

American Medical Systems, Inc.

10700 Bren Road West

Minnetonka, MN 55343

 

with separate copies thereofaddressed to:

 

Attention: Chief ExecutiveOfficer

Facsimile: (952) 930-5737

 

and

 

Attention: Senior VicePresident — Law Department

Facsimile: (952) 930-6496

 

With a copy to:

 

Fredrikson &Byron, P.A.

200 South Sixth Street

Minneapolis, MN  55402-1425

Attn:  James H. Snelson

Facsimile: (612) 492-7077

 

To Purchaser:

 

Conceptus, Inc.

331 East Evelyn

Mountain View, CA 94041

Attn.:  GregLichtwardt, Chief Financial Officer

Facsimile: (650) 691-4737

 

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With a copy to:

 

Latham & WatkinsLLP

140 Scott Drive

Menlo Park, CA  94025

Attn:  Ora T. Fisher, Esq.

Facsimile: (650) 463-2600

 

Anotice shall be deemed given on the day when actually delivered as providedabove (if delivered personally, by courier or by facsimile) or on the day shownon the return receipt (if delivered by mail).

 

7.2           Specific Performance.  In the eventof any breach by an Asset Selling Corporation of Sections 5.1 or 5.7hereof, or any breach by either party of Sections 5.6 or 7.8 (or thecontrol of defense provisions of Section 6.4) hereof, the breachingparty, on behalf of itself and its Affiliates, hereby agrees that thenon-breaching party may be irreparably harmed and unable to be made whole bymonetary damages and that the non-breaching party, in addition to any otherremedy to which it may be entitled at law or in equity, shall be entitled toseek specific performance of such provisions.

 

7.3           Amendment; Waiver.  Except asdescribed in Section 6.10 above, any provision of this Agreementmay be amended or waived if, and only if, such amendment or waiver is inwriting and signed, in the case of an amendment, by Purchaser and Parent, or inthe case of a waiver, by the party against whom the waiver is to beeffective.  Except as described in Section 6.10above, no failure or delay by any party in exercising any right, power orprivilege hereunder shall operate as a waiver thereof nor shall any single orpartial exercise thereof preclude any other or further exercise thereof or theexercise of any other right, power or privilege.

 

7.4           Assignment.  No party tothis Agreement may assign any of its rights or obligations under this Agreementwithout the prior written consent of the other party hereto.

 

7.5           Entire Agreement.  ThisAgreement (including all Schedules and Exhibits hereto) contains the entire agreementbetween the parties hereto with respect to the subject matter hereof andsupersedes all prior agreements and understandings, oral or written, withrespect to such matters, except for the Confidentiality Agreement, which willremain in full force and effect with respect to any confidential informationnot included within the Conveyed Assets for the term provided for therein, andany written agreement of the parties that expressly provides that it is notsuperseded by this Agreement.

 

7.6           Fulfillment of Obligations. Any obligation of any party to any other party under this Agreement,which obligation is performed, satisfied or fulfilled by an Affiliate of suchparty, shall be deemed to have been performed, satisfied or fulfilled by suchparty.

 

7.7           Parties in Interest.  ThisAgreement shall inure to the benefit of and be binding upon the parties heretoand their respective successors and permitted assigns.  Except with respect to the Asset SellingCorporations, nothing in this Agreement, express or implied, is

 

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intended to confer upon any Person other thanPurchaser, Parent, or their successors or permitted assigns, any rights orremedies under or by reason of this Agreement.

 

## 7.8           Public Disclosure; Confidential Information.

##  

### (a)           Notwithstandinganything herein to the contrary, each of the parties to this Agreement herebyagrees with the other party hereto that no press release or similar publicannouncement or communication shall be made or caused to be made concerning theexecution or performance of this Agreement unless the parties shall have agreedin advance as to the contents thereof, except as such release or announcementmay be required by Law or the rules or regulations of any applicableUnited States securities exchange or Governmental Authority to which therelevant party is subject or submits, in which case the party required to makethe release or announcement shall use its reasonable best efforts to allow eachother party reasonable time to comment on such release or announcement inadvance of such issuance, it being understood that the final form and contentof any such release or announcement, to the extent so required, shall be at thefinal discretion of the disclosing party.

###  

### (b)           Forpurposes of this Section 7.8, “Confidential Information”means confidential information in the possession or control of an Asset SellingCorporation that relates to the Conveyed Assets, including technical,manufacturing or marketing information, ideas, methods, developments,inventions, improvements, business plans, trade secrets, scientific orstatistical data, diagrams, drawings, specifications or other proprietaryinformation relating thereto, together with all notes, analyses, compilations,forecasts, studies or other documents, records or data prepared by an AssetSelling Corporation or its directors, officers, employees, Affiliates,representatives (including attorneys, accountants, consultants, bankers andfinancial and other advisors) or agents (collectively, “Representatives”)which contain or otherwise reflect or are generated from such information.  The term “Confidential Information” does notinclude information which (i) is or becomes generally available to thepublic other than as a result of a disclosure by an Asset Selling Corporationor its Representatives, or (ii) is or becomes available to an AssetSelling Corporation on a non-confidential basis from a source that is not boundby a confidentiality agreement with, or other contractual, legal or fiduciaryobligation of confidentiality to, Purchaser or any other person with respect tosuch information.

###  

### (c)           EachAsset Selling Corporation shall treat all Confidential Information asconfidential, preserve the confidentiality thereof and not disclose anyConfidential Information, except in connection with the transactionscontemplated hereby and by the Ancillary Agreements, or in connection with theexercise of rights or the satisfaction of obligations hereunder or thereunder.  Each Asset Selling Corporation shall use allreasonable efforts to cause its Representatives to treat all ConfidentialInformation as confidential, preserve the confidentiality thereof and notdisclose any Confidential Information, as provided herein.  Each Asset Selling Corporation shall beresponsible for any breach of this Agreement by any of itsRepresentatives.  If, however, an Asset Selling Corporation is made awarethat Confidential Information has been disclosed as prohibited

 

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### herein by it or its Representatives, Parent shall immediately notifyPurchaser in writing and take all reasonable steps required to prevent furtherdisclosure.

###  

### (d)           Ifan Asset Selling Corporation or any of its Representatives is requested orrequired (by oral questions, interrogatories, requests for information ordocuments in legal proceedings, subpoena, civil investigative demand or othersimilar process) or is required by operation of law to disclose anyConfidential Information, Parent shall provide Purchaser with prompt writtennotice of such request or requirement, which notice shall, if practicable, beat least 48 hours prior to making such disclosure, so that Purchaser may seek aprotective order or other appropriate remedy and/or waive compliance with theprovisions of this Agreement.  If, in theabsence of a protective order or other remedy or the receipt of such a waiver,an Asset Selling Corporation or any of its Representatives are nonetheless, inthe opinion of counsel, legally compelled to disclose Confidential Information,then such Asset Selling Corporation may disclose that portion of theConfidential Information which such counsel advises is legally required to bedisclosed, provided such Asset Selling Corporation uses its reasonable effortsto preserve the confidentiality of the Confidential Information, whereupon suchdisclosure shall not constitute a breach of this Agreement.

###  

7.9           Expenses.  Except asotherwise expressly provided in this Agreement, whether or not the transactionscontemplated by this Agreement are consummated, all costs and expenses incurredin connection with this Agreement and the transactions contemplated herebyshall be borne by the party incurring such expenses.

 

7.10         Schedules.  Thedisclosure of any matter in any Schedule to this Agreement shall be deemed tobe a disclosure for all purposes of this Agreement to which such matter couldreasonably be expected to be pertinent, but shall expressly not be deemed toconstitute an admission by any Asset Selling Corporation or Purchaser, or tootherwise imply, that any such matter is material for the purposes of thisAgreement.

 

7.11         Governing Law.  ThisAgreement shall be governed by the laws of the State of New York, its rules ofconflict of laws notwithstanding.

 

7.12         Waiver of Jury Trial.  Each partyhereby waives its rights to a jury trial of any claim or cause of action basedupon or arising out of or related to this Agreement or the subject matterhereof.  The scope of this waiver isintended to be all-encompassing of any and all disputes that may be filed inany court and that relate to the subject matter of the transactionscontemplated hereby, including, contract claims, tort claims, breach of dutyclaims, and all other common law and statutory claims.  This Section 7.12 has been fullydiscussed by each of the parties and these provisions shall not be subject toany exceptions.  Each party herebyfurther warrants and represents that such party has reviewed this waiver withits legal counsel and that such party knowingly and voluntarily waives its jurytrial rights following consultation with legal counsel.  This waiver is irrevocable, meaning that itmay not be modified either orally or in writing, and this waiver shall apply toany subsequent amendments, supplements or modifications to (or assignments of)this Agreement.  In the event oflitigation, this Agreement maybe filed as a written consent to a trial (withouta jury) by the court.

 

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7.13         Counterparts.  This Agreementmay be executed in two or more counterparts, all of which shall be consideredone and the same agreement and shall become effective when one or morecounterparts have been signed by each of the parties and delivered tothe other party, it being understood that all parties need not sign the samecounterpart.  A facsimile or PDFsignature of this Agreement shall be valid and have the same force and effectas a manually signed original.

 

7.14         Headings.  The headingreferences herein and the table of contents hereto are for convenience purposesonly, do not constitute a part of this Agreement and shall not be deemed tolimit or affect any of the provisions hereof.

 

7.15         Severability.  In the eventthat any provision of this Agreement or the application thereof, becomes or isdeclared by a court of competent jurisdiction to be illegal, void orunenforceable, the remainder of this Agreement will continue in full force andeffect and the application of such provision to other Persons or circumstanceswill be interpreted so as reasonably to effect the intent of the partieshereto.  The parties further agree toreplace such void or unenforceable provision of this Agreement with a valid andenforceable provision that will achieve, to the greatest extent possible, theeconomic, business and other purposes of such void or unenforceable provision.

 

*[Theremainder of this page has been intentionally left blank]*

 

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IN WITNESS WHEREOF, the parties have executed or caused this AssetPurchase Agreement to be executed as of the date first written above.

 

 
| PARENT:                               |                     | PURCHASER:              |
|---------------------------------------|--------------------------|-------------------------|
|                                  |                     |                    |
| American Medical  Systems, Inc., |                     | Conceptus, Inc.,   |
| a Delaware  corporation               |                     | a Delaware  corporation |
|                                  |                     |                    |
| By:                                   | /s/ Anthony P.  Bihl III |                    | By: | /s/ Mark M.  Sieczkarek |
| Name:                                 | Anthony P. Bihl  III     |                    | Name: | Mark M. Sieczkarek |
| Title:                                | President and  CEO       |                    | Title: | CEO and  President |

 

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