**UNITED STATESSECURITIES AND EXCHANGE COMMISSION**

**Washington,D.C. 20549**

----

**FORM 10-K**

| x      | **ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF  1934**                                                           |
|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   | **For the fiscal year ended December 31, 2005**                                                                                                          |
|   | **or**                                                                                                                                                        |
| o      | **TRANSITION REPORT PURSUANT TO  SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934**                                                       |
|   | **For the transition period  from                    to** |

 

**Commissionfile number:  333-124100**

----

**CDRV INVESTORS, INC.**

(Exact name of registrantas specified in its charter)

| **Delaware**                              |   | **56-2445503**       |
|-------------------------------------------|--------|----------------------|
| (State or other  jurisdiction of          |   | (I.R.S. Employer     |
| incorporation or  organization)           |   | Identification  No.) |
| **1310 Goshen Parkway**                   |   | ** **           |
| **PO. Box  2656**                         |   | ** **           |
| **West  Chester, PA**                     |   | **19380**            |
| (Address of  principal executive offices) |   | (Zip code)           |

 

Registrant’s telephonenumber, including area code:  **(610) 431-1700**

Securities registeredpursuant to Section 12(b) of the Act: **None**

Securities registeredpursuant to Section 12(g) of the Act: **None**

Indicate by check mark ifthe registrant is a well-known seasoned issuer, as defined in Rule 405 ofthe Securities Act. Yes o  No x

Indicate by check mark ifthe registrant is not required to file reports pursuant to Section 13 or15(d) of the Act. Yes x  No o

Indicate by check markwhether the registrant (1) has filed all reports required to be filed by Section 13or 15(d) of the Securities Exchange Act of 1934 during the preceding 12months (or for such shorter period that the registrant was required to filesuch reports), and (2) has been subject to such filing requirements forthe past 90 days. Yes o  No x

Indicate by check mark ifdisclosure of delinquent filers pursuant to Item 405 of Regulation S-K is notcontained herein, and will not be contained, to the best of registrant’sknowledge, in definitive proxy or information statements incorporated byreference in Part III of this Form 10-K or any amendment tothis Form 10-K. x

Indicateby check mark whether the registrant is a large accelerated filer, anaccelerated filer, or a non-accelerated filer. See definition of “acceleratedfiler and large accelerated filer”  in Rule 12b-2of the Exchange Act. (Check one):

| Large accelerated filer o |   | Accelerated  filer o |   | Non-accelerated  filer x |
|--------------------------------|--------|----------------------|--------|--------------------------|

 

Indicate by check markwhether the registrant is a shell company (as defined in Rule 12b-2of the Act). Yes o  No x

As of December 31,2005, there was no established public market for the registrant’s common stock,par value $0.01 per share.  The number ofshares of the registrant’s common stock outstanding at March 24, 2006, was5,756,451.

**DOCUMENTSINCORPORATED BY REFERENCE**

**None**

 

----

**TABLE OF CONTENTS**
|           | ** ** | ** **                                                                                                         | ** ** | **Page** | ** ** |
|-----------|------------|--------------------------------------------------------------------------------------------------------------------|------------|----------|------------|
|      |       | PART I                                                                                                        |       |     |       |
| ITEM 1.   |       | BUSINESS                                                                                                           |       | 1        |       |
| ITEM 1A.  |       | RISK FACTORS                                                                                                       |       | 10       |       |
| ITEM 1B.  |       | UNRESOLVED STAFF COMMENTS                                                                                          |       | 16       |       |
| ITEM 2.   |       | PROPERTIES                                                                                                         |       | 17       |       |
| ITEM 3.   |       | LEGAL PROCEEDINGS                                                                                                  |       | 17       |       |
| ITEM 4.   |       | SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS                                                                |       | 18       |       |
|      |       | PART II                                                                                                       |       |     |       |
| ITEM 5.   |       | MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED  STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES |       | 19       |       |
| ITEM  6.  |       | SELECTED  FINANCIAL DATA                                                                                           |       | 21       |       |
| ITEM 7.   |       | MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL  CONDITION AND RESULTS OF OPERATIONS                        |       | 23       |       |
| ITEM 7A.  |       | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET  RISK                                                        |       | 39       |       |
| ITEM 8.   |       | FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA                                                                        |       | 41       |       |
| ITEM 9.   |       | CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON  ACCOUNTING AND FINANCIAL DISCLOSURE                              |       | 89       |       |
| ITEM 9A.  |       | CONTROLS AND PROCEDURES                                                                                            |       | 89       |       |
| ITEM  9B. |       | OTHER  INFORMATION                                                                                                 |       | 89       |       |
|      |       | PART III                                                                                                      |       |     |       |
| ITEM 10.  |       | DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT                                                                 |       | 89       |       |
| ITEM 11.  |       | EXECUTIVE COMPENSATION                                                                                             |       | 94       |       |
| ITEM 12.  |       | SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND  MANAGEMENT AND RELATED STOCKHOLDER MATTERS                    |       | 101      |       |
| ITEM 13.  |       | CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS                                                                     |       | 102      |       |
| ITEM 14.  |       | PRINCIPAL ACCOUNTANT FEES AND SERVICES                                                                             |       | 105      |       |
|      |       | PART IV                                                                                                       |       |     |       |
| ITEM 15.  |       | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES                                                                         |       | 106      |       |

 

----

In this Form 10-K, unless the context requiresotherwise, references to the “Company,” “we,” “us” and “our” mean CDRVInvestors, Inc. and its consolidated subsidiaries. CDRV Investors, Inc.is the ultimate parent company of VWR International, Inc. (“VWR”).

i

----

**PART I**

**ITEM 1.**               BUSINESS

**Overview**

We are a leader in theglobal research laboratory industry. We provide distribution and othervalue-added services to a highly fragmented supply chain by offering in excessof 1,200,000 products from more than 2,500 manufacturers to over 250,000customers. Our business is highly diversified across products and services,geographic regions and customer segments. Products we distribute includechemicals, glassware, instruments, protective clothing and other assortedlaboratory products. We support our customers by providing storeroommanagement, product procurement, supply chain systems integration, technicalservices and laboratory bench top delivery. We maintain operations in NorthAmerica and in 15 European countries and process an average of 50,000 orderlines daily from 16 strategically located distribution centers. Our principalcustomers are major pharmaceutical, biotechnology, chemical, technology, foodprocessing and consumer product companies; universities and researchinstitutes; governmental agencies; environmental testing organizations; andprimary and secondary schools.

The roots of our businessdate back to 1852. Following a series of business combinations, VWR became partof Univar Corporation. In 1986, VWR became a publicly-traded company followinga spin-off from Univar and embarked on a substantial expansion program, whichincluded both internal and acquisition growth initiatives. VWR’s mostsignificant acquisition occurred in 1995 when it purchased Baxter International’sindustrial distribution business, more than doubling its revenue base. Inconnection with this acquisition, Merck KGaA acquired 49.9% of VWR’soutstanding shares and, in 1999, Merck KGaA took VWR private by acquiring theremainder. During the period from 1995 through 1999, Merck KGaA actively builtits scientific supplies distribution business in Europe through a series ofacquisitions. In 2001, Merck KGaA combined the operations of the twobusinesses, and in 2002, consolidated them under a common U.S. parent company,creating a leader in the global research laboratory industry.

On April 7, 2004, VWRwas acquired from Merck KGaA by our wholly-owned subsidiary, CDRV Holdings, Inc.(the “Acquisition”). In connection with the Acquisition, VWR issued $200.0million senior notes due 2012 and $320.0 million senior subordinated notes due2014 (the “VWR Notes”) and entered into a senior secured credit facility (the “SeniorSecured Credit Facility”), consisting of a $150.0 million multi-currencyrevolving credit facility, as well as a U.S. dollar-denominated term loan and aEuro-denominated term loan. The term loans were initially $415.0 million and €145.0million in principal amount, respectively, which were subsequently reducedthrough prepayments on July 30, 2004 to $379.9 million and €132.7million (approximately $157.2 million as of December 31, 2005, on a U.S.dollar equivalent basis), respectively.

On December 16, 2004,we issued $481.0 million aggregate principal amount at maturity ($299.4 milliongross proceeds) of 95¤8% senior discountnotes due 2015 (“Senior Discount Notes”). See—“Item 7—Management’s Discussionand Analysis of Financial Condition and Results of Operations—IndebtednessFollowing the Acquisition” for more information.

During 2005, we expandedour market presence in Ireland, Puerto Rico and Continental Europe throughstrategic acquisitions. See “Item 7—Management’s Discussion and Analysis ofFinancial Condition and Results of Operations” for more information about ouracquisitions in 2005. In addition, we have initiated strategic plans to expandour presence into Eastern Europe and Asia Pacific to develop and expand bothsourcing and commercial sales opportunities.

We report our financialresults on the basis of the following three business segments: North Americanlaboratory distribution, or North American Lab, European laboratorydistribution, or European Lab, and Science Education. Both the North AmericanLab and European Lab segments are comprised of the distribution of scientific suppliesto customers in the pharmaceutical, biotechnology, chemical, technology, 

1

----

foodprocessing, governmental agencies, colleges and universities and environmentalorganizations. Science Education is comprised of the manufacture anddistribution of scientific supplies and specialized kits principally to primaryand secondary schools in North America.

**Customers andMarkets**

We estimate that the 2005industry-wide revenues of the global research laboratory market in which ourNorth American Lab and European Lab segments operate were approximately $23billion. Management estimates that the industry has grown at mid-single digitrates. We expect this growth to continue in the future, driven by increasingResearch and Development (“R&D”) spending from a diversified collection ofend-markets, including pharmaceutical, biotechnology, chemical, education,medical research, government and environmental testing. Our net sales areinfluenced by, but not directly correlated with, the growth of R&Dspending, and we expect that results may vary by end-market.

In relation to our ScienceEducation segment, we estimate that the 2005 revenues for the North Americanmarket for scientific supplies for primary and secondary schools wereapproximately $475 million. Industry sales levels are subject to fluctuationsdriven by changes in state and local government funding, the timing of thestate-by-state new textbook adoption cycle and population changes.

We maintain a diverse andstable customer base. Our customers include major pharmaceutical,biotechnology, chemical, technology, food processing and consumer productscompanies. They also include universities and research institutes, governmentalagencies, environmental testing organizations and primary and secondaryschools. While we serve our customers through our operations in North Americaand in 15 European countries, we also export products from our distributionfacilities in North America and Europe to customers in Central America, SouthAmerica, British Commonwealth countries, North Africa, the Middle East and thePacific Rim. For financial information about our operating segments andgeographic regions, see “Item 7—Management’s Discussion and Analysis ofFinancial Condition and Results of Operations.”

We seek to be theprincipal provider of scientific supplies to our customer base. We are aprincipal provider of scientific supplies to a majority of the world’s 20largest pharmaceutical companies, as well as three of the largest NorthAmerican biotechnology buying consortia. Pharmaceutical and biotechnologycompanies represented approximately 36% of our 2005 net sales, and togetherwith universities and colleges, accounted for approximately 50% of our 2005 netsales. In 2005, our top 20 customers accounted for approximately 23% of our netsales, with no single customer representing more than 3% of our net sales.

We seek to developlong-term relationships with our customers. We provide an array of value-addedservices that integrate us with our customers. Our customized service offeringsinclude outsourcing of customers’ purchasing, delivery, receiving and inventorymanagement functions. See below under “—Products and Services—Services.”

**Products andServices**

***Products***

We offer more than1,200,000 products, including chemicals, glassware, plasticware, instrumentsand other laboratory equipment, protective clothing, laboratory furniture andscientific educational materials for primary and secondary schools. The vastmajority of our products cost less than $1,000. Many of our products, includingchemicals, laboratory consumables, production supplies and science educationproducts, are consumable in nature. These products are basic and essentialsupplies required by research laboratories and represented approximately 75% ofour net sales in 2003, 2004 and 2005. We also offer durable products, includingcentrifuges, fume hoods and workstations, ovens, microscopes and cold storageequipment. We also have a strong market position for the distribution ofchemical supplies, especially in Europe.

2

----

Thefollowing table summarizes our product lines:

| **Product Line**                  | ** ** | ** **                                                                                                                                                                                        | ** ** | **Products** |
|-----------------------------------|------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|--------------|
| Laboratory Consumables            |       | Glassware/plasticware,  test kits, beakers, test tubes, life science disposable products, equipment  accessories and other less technical equipment required by all research  laboratories        |
| Chemicals                         |       | Chemical products  for various academic, research and industrial markets, including high purity  chemicals, reagents and specialty products for the life sciences market                          |
| Equipment &  Instruments |       | Laboratory  equipment and instrumentation, including centrifuges, spectrometers,  microplate readers, fume hoods and workstations, liquid handling,  meters/probes and chromatography instruments |
| Production Supplies               |       | Products in clean  room environments, primarily in the semiconductor, electronic, medical device  and pharmaceutical markets                                                                      |
| Science Education                 |       | Educational products,  tools and support materials (excluding textbooks) for the educational system,  from elementary to college level                                                            |

 

In 2005, approximately 88%of our current global net sales consisted of manufacturer branded products. Ourmanagement continually seeks to update and improve product offerings to addresscurrent customer requirements.

***Services***

We offer servicesthat can be tailored to meet the diversified needs of customers ranging fromsingle-site laboratories to large multinational corporations. These servicesinclude the following:

·                    softwaresolutions for all aspects of on-site supply-chain management includinginventorymanagement, demand monitoring, procurement and replenishment;

·                    paperlesse-business solutions to integrate customer systems with our systems, providingcustomized reporting and order tracking;

·                    hazardousmaterials tracking systems which automate regulatory paperwork and data flow;

·                    storeroommanagement operations including deliveries, usage tracking, order replenishmentand billing by utilizing our on-site personnel and stockroom management system;and

·                    purchase andsupply of third party products not normally supplied by us.

3

----

**Distribution Network**

Our distribution networkconsists of 16 strategically located distribution centers, more than 20 smallerregional service centers and additional “Just-In-Time” facilities for customerspecific requirements. Most of our distribution centers include a customercontact center. The distribution centers receive products from manufacturers,manage inventory and fill and ship customer orders. The customer contactcenters have responsibility for order entry and customer service. We alsocontract with Merck KGaA and other third parties to provide us with additionaldistribution facilities and services in Europe, including facilities inDarmstadt, Germany, Mollet del Valles, Spain and Milan, Italy. The table belowlists our 16 strategically located distribution centers:

| **North America**            | ** ** | ** **                  | ** ** | **Europe** | ** ** | ** ** |
|------------------------------|------------|-----------------------------|------------|------------|------------|------------|
| Batavia, Illinois            |       | Briare, France              |
| Bridgeport, New Jersey       |       | Bruchsal, Germany           |
| Brisbane, California         |       | Darmstadt, Germany          |
| Buffalo, New York            |       | Haasrode, Belgium           |
| Denver, Colorado             |       | Karlskoga, Sweden           |
| Mississauga, Ontario, Canada |       | Lutterworth, United Kingdom |
| Rochester, New York          |       | Milan, Italy                |
| Suwanee, Georgia             |       | Mollet del Valles, Spain    |

 

Our distribution centers are operated with warehousemanagement systems, most of which are paperless. The paperless system usesradio frequency hand-held electronic devices and bar-coded labels that identifylocation, routing and inventory picking and replacement, allowing us to monitorinventory and track individual customer orders throughout our distributionsystem.

Our regional service centers and “Just-in-Time”facilities are adjacent to selected customer locations and are designed tosupply a limited number of products to those customers that requirehigher-than-standard service levels.

We ship our productsprimarily through third-party carriers, such as UPS, Airborne Express, FedExand others. We do not have exclusive relationships with any of our serviceproviders, as we seek to mitigate potential service disruptions stemming fromreliance on a single vendor. Our largest service provider in the United Statesrepresented approximately 33% of our shipments in 2005. No other serviceprovider in the United States represented greater than 7% of our shipments in2005.

**Sales and Marketing**

We market to customers through our global sales force,our websites, and our library of catalogs. We have a global sales force of over1,200 employees and have approximately 700 employees providing key services,including storeroom management, product management, product procurement, supplychain systems integration, technical services and laboratory bench topdelivery. Supporting the field sales organization are specialist groups fore-business integrations, customized services, laboratory furniture, safety,environment, microbiology, chromatography and life science.

The Internet has become an increasingly important toolfor us. During 2005, approximately 27% of our net sales were derived frome-business sales and marketing channels. Our websites feature a fully indexedand searchable catalog covering our entire product line, is available in 11languages and has been custom-designed for 18 countries. This electroniccatalog includes product descriptions, technical specifications andcross-referenced data in a variety of different languages through individualcountry sites. This website allows customers to enter orders directly andenables us to communicate new product releases, promotions and other news toour customers.

4

----

In addition to our websites, we have, as part of ourintegrated business services capability, a growing e-business offeringthat covers order creation, authorization, order status, billing and reporting.These capabilities provide direct data transfer to customers’ systems andintegration with third-party marketplaces used by some of our customers.

Although we are a leaderin providing action-based and content-rich web-based information, we continueto see a need for printed catalogs and other printed materials following thepreferences of many customers. Our general catalogs are printed in 11 languagesand include up to 47,000 products per printed catalog. The general catalogs aresupplemented by several specialty catalogs for life sciences products, safetyproducts, production supplies and services applications, science education andspecific laboratory focus areas.

**Manufacturers**

We distribute products from more than 2,500manufacturers. This includes a majority of the major manufacturers oflaboratory chemicals, glassware, plasticware, instruments and other laboratoryequipment, protective clothing and laboratory furniture who sell throughdistributors. In many cases, we believe we are a principal distributor forthese major manufacturers. We are also the exclusive distributor of Merck KGaA’schemical products in the laboratory field in many Western European countries.Merck KGaA supplied products that accounted for approximately 13% of our netsales in 2005. This represents approximately 7% and 25% of our North AmericanLab and European Lab net sales, respectively. Our distribution arrangementswith Merck KGaA are summarized below.

***Merck KGaA EuropeanDistribution Agreement.******  ***In connectionwith the Acquisition, we entered into a distribution agreement with Merck KGaAto continue distributing its chemical products in many European countries onsubstantially the same terms as those governing the distribution of suchproducts prior to the Acquisition. Under this agreement, we have exclusivedistribution rights in the laboratory field, and non-exclusive distributionrights in the production field, in these European countries. We may notdistribute other manufacturers’ similar chemical products in the laboratoryfield in these countries, except pursuant to certain requests by customers, andwe may continue to sell our private label products. Conversely, Merck KGaA maynot sell directly to or appoint another distributor to sell its chemicalproducts in thelaboratory field, or sell its chemical products directlyto our current customers in the production field, in these countries.

The prices and purchase targets are agreed uponannually, taking into account market, economic and regulatory developments orreasonably foreseeable extraordinary events that are likely to have an impacton the industry pricing or sales growth in relevant products and marketsegments.If our aggregate purchases of certain chemical products from Merck KGaA grow ata rate that is less than the agreed-upon Europe-wide growth rate (subject to a50% shortfall as compared to the agreed-upon growth rate) in each of twoconsecutive years, and such aggregate purchases are less than 92.5% of theEurope-wide purchase targets in each such consecutive year, we will lose ourexclusive rights in the laboratory field. The purchase targets and purchasesare adjusted from time to time to reflect events outside our control, includingcustomer consolidations, material adverse effects on the industry, includingpricing and demand, and new product introductions by other manufacturers notmatched by Merck KGaA. For the year ended December 31, 2005, we have exceededthe 92.5% purchase target specified in the agreement.

The initial term of the agreement is five years, whichcommenced on April 7, 2004. We may extend the agreement for a secondfive-year term if we satisfy certain conditions, including achieving at least95% of the cumulative Europe-wide sales targets and maintaining our marketshare during the initial term. Merck KGaA has the right to terminate thedistribution agreement if certain events occur, including, among others, if weacquire a controlling interest in certain competitive manufacturers, or certaincompetitive 

5

----

manufacturers acquire acontrolling interest in us. The Company has no acquisition plans that wouldconflict with the terms of the agreement.

***Other Merck KGaADistribution Agreements.******  ***In connectionwith the Acquisition, we entered into a five-year distribution agreement withMerck KGaA to distribute certain chemical products in North America onsubstantially the same terms as those governing their distribution prior to theAcquisition. We do not have exclusive distribution rights in North America, butwe are Merck KGaA’s preferred distributor of its chemical products. As MerckKGaA’s preferred distributor, we are entitled to, among other things, thelowest transfer prices from Merck KGaA for so long as we maintain our marketshare in the laboratory field. We have the right to extend the agreement for asecond five-year term unless Merck KGaA submits a termination notice at least12 months prior to the expiration of the initial term. Merck KGaA may terminatethe distribution agreement if certain events occur, including, among others, ifwe acquire a controlling interest in certain competitive manufacturers. TheCompany has no acquisition plans that would conflict with the terms of this agreement.

In connection with theAcquisition, we have also entered into other distribution agreements with MerckKGaA, including five-year distribution agreements with Merck KGaA to distributeits bioscience products in Europe and North America. In addition, we enteredinto a supply agreement with Merck KGaA, pursuant to which we had agreed tocontinue to manufacture certain of our private label products for an initialperiod of three years from April 7, 2004, and thereafter to providetechnical assistance in transitioning their manufacture to other manufacturers.These products are primarily sold in the UK, and we have agreed to use ourcommercially reasonable efforts to convert these products to Merck KGaA brandedproducts to the extent that the conversion would be economically equivalent tous. During 2005, this agreement was extended through December 31, 2007.

**Manufacturing**

We have specializedmanufacturing facilities in Briare, France; Haasrode, Belgium; Buffalo, NewYork and Rochester, New York. The Briare site repackages chemicals and alimited assortment of our branded glassware. Our Haasrode site produces ourbranded chemicals. Buffalo assembles specialized kits for our science educationcustomers. The Rochester site is involved in the preparation of educational andnatural science products. Products manufactured by us accounted forapproximately 2% of our net sales in 2005.

**Transition and Other Services**

We and Merck KGaA have historically performedcorporate services for each other, including certain financial, administrativeand information technology functions. In order to maintain continuous andefficient operations, effective as of April 7, 2004, we entered into atransition services agreement and an information services master agreement withMerck KGaA to maintain these relationships following the Acquisition until suchtime as these services can be obtained internally or from other sources. Theterm of the transition services agreement is three years, and it will expire onApril 6, 2007, although the recipient of the services has in most casesthe right to terminate individual services upon notice. We and Merck KGaA willalso continue to provide each other with certain environmental and otherregulatory compliance services for a transition period following theAcquisition. During 2005, the Company and Merck KGaA have made substantialprogress to reduce these interdependencies. Currently, the level ofinterdependency is minimal with respect to financial and administrativefunctions.

Following the completion of the Acquisition, we andMerck KGaA have also continued to provide certain information technologyservices to each other consistent with the arrangements in place prior to theAcquisition, including Merck KGaA’s operation and support of the main enterpriseresource planning and business warehouse software and databases for ourEuropean companies. The information services 

6

----

master agreement willcontinue for an initial five-year period from the closing date of theAcquisition and will expire on April 6, 2009, although individual servicesmay be terminated during the term following a notice period. The Companycontinues to depend on Merck KGaA to host certain enterprise systems, fulfillhardware support requirements and conduct related information technologyfunctions, such as data archival.

Merck KGaA may terminate each of the transitionservices agreement and the information services master agreement if certainevents occur including, among others, if we acquire a controlling interest incertain competitive manufacturers, or if certain competitive manufacturersacquire a controlling interest in us. The Company has no acquisition plans thatwould conflict with these agreements.

The transition services agreement does not apply tocertain arrangements involving Merck KGaA and us that were in place prior tothe Acquisition, which continue on for their existing terms. For example, MerckKGaA continues to provide logistics services to certain of our subsidiariesuntil the end of 2007. Unless earlier terminated following a notice period,such logistics service arrangements will be automatically renewed for anadditional three years.

Certain subsidiaries ofMerck KGaA and certain of our subsidiaries lease or sublease from one another,or otherwise share, space in various offices and warehouses in Europe and inMexico since the completion of the Acquisition. The terms of these leasing andsubleasing arrangements range from less than one year to up to six or moreyears and are generally at market rents and conditions. Certain other existingcontracts have also remained in place since the Acquisition, and were notreplaced by transition services agreements.

**Trademarks and Trade Names**

We have more than 50 different registered andunregistered service marks and trademarks for our products and services. Themarks *VWR*, *VWR International* and the *VWR* logo are material to our business.Other trademarks that we consider significant to our business include *VWR BioMarke*, *VWR Stocktracker*, *BDH*,*Prolabo*, *Cryopro*, *Sargent-Welch,Boreal*, *Astroscan*, *Scholar*, *ScienceKit*, *Scientifics*, *Cenco*, *Citri-Pure*and *Vial to Volume*. Generally,registered trademarks have perpetual life, provided that they are renewed on atimely basis and continue to be used properly as trademarks, subject only tothe rights of third parties to seek cancellation of the marks.

A significant number of our marks were owned by MerckKGaA. In connection with the Acquisition, Merck KGaA agreed that it wouldtransfer, and cause its affiliates to transfer, ownership of registrations andapplications for marks owned by a Merck KGaA entity but used primarily in ourbusiness to us at Merck KGaA’s cost. As of December 31, 2005,substantially all of such transfers have been made. We have not registered andin some cases do not own the existing applications and registrations for ourmaterial trademarks or service marks in every country in which we do business.

Our business is not dependent to a material degree onpatents, copyrights or trade secrets although we consider our catalogs,websites and proprietary software integral to our operations. Although webelieve we have adequate policies and procedures in place to protect ourintellectual property, we have not sought patent protection for our processesnor have we registered the copyrights in any of our catalogues, websites orproprietary software. Other than licenses to commercially available third-partysoftware, we have no licenses to intellectual property that are significant tothe business.

7

----

**Competition**

We operate in a highly competitive environment. Wecompete in the scientific supplies distribution business primarily with twomajor distributors, Fisher Scientific International Inc. and Sigma-AldrichCorporation, and with many smaller regional, local and specialty distributors,as well as with manufacturers selling directly to their customers. Competitivefactors include price, service and delivery, breadth of product line, customersupport, e-business capabilities and the ability to meet the specialrequirements of customers. We believe we compete effectively on all of thesefactors. We also believe that our competitive position depends not on a singlefactor, but upon a combination of traditional distribution services, customizedservices and technological innovation, practiced on a global basis.

Some of our competitorsare increasing their manufacturing operations both internally and throughacquisitions of manufacturers, including manufacturers that supply products tous. As a result, we expect that some manufacturers that currently distributetheir products through these competitors may transition some or all of theirdistribution arrangements to distributors like us that do not compete withthem. To date, we have not experienced an adverse impact on our ability tocontinue to source products from manufacturers that have been verticallyintegrated, although there is no assurance that we will not experience such animpact in the future.

**Government Regulation**

Some of the products weoffer and our operations are subject to a number of complex and stringent lawsand regulations governing the production, handling, transportation anddistribution of chemicals, drugs and other similar products, including theoperating and security standards of the United States Drug EnforcementAdministration, the Bureau of Alcohol, Tobacco, Firearms and Explosives, theFood and Drug Administration, the Bureau of Industry and Security and variousstate boards of pharmacy as well as comparable state and foreign agencies. Inaddition, our logistics activities must comply with the rules andregulations of the Department of Transportation, the Federal AviationAdministration and similar foreign agencies. While we believe we are incompliance in all material respects with such laws and regulations, anynon-compliance could result in substantial fines or otherwise restrict ourability to provide competitive distribution services and thereby have anadverse impact on our financial condition. For information on environmental, healthand safety matters, see below under “—Environmental, Health and Safety Matters.”

**Employees**

As of December 31,2005, we had approximately 6,100 employees, including approximately 3,400employees in North America and approximately 2,700 employees in Europe. As of December 31,2005 approximately 7% of our employees in North America are represented byunions, and virtually all of our employees in Europe are represented by workers’councils and unions. While we believe our relations with our employees are good,there can be no assurance that further union expansion will not occur and causeincreased future costs.

**Environmental,Health and Safety Matters**

We are subject to a broad range of foreign, federal,state and local environmental, health and safety laws and regulations,including those pertaining to air emissions, water discharges, the handling,disposal and transport of solid and hazardous materials and wastes, theinvestigation and remediation of contamination and otherwise relating to healthand safety and the protection of the environment and natural resources. As ourglobal operations involve and have involved the handling, transport anddistribution of materials that are or could be classified as toxic orhazardous, there is some risk of contamination and environmental damageinherent in our operations and the products we handle, transport anddistribute. Our environmental, health and safety liabilities and obligationsmay result in 

8

----

significant capitalexpenditures and other costs, which could negatively impact our business,financial condition and results of operations. We may be fined or penalized byregulators for failing to comply with environmental, health and safety laws andregulations. In addition, contamination resulting from our current or pastoperations may trigger investigation or remediation obligations, which may havea material impact on our business, financial condition and results ofoperations.

Based on currentinformation, we believe that any costs we may incur relating to environmentalmatters will not be material. We cannot be certain, however, thatidentification of presently unidentified environmental conditions, morevigorous enforcement by regulatory authorities or other unanticipated eventswill not arise in the future and give rise to additional environmentalliabilities, compliance costs or penalties which could have a material impacton our business, financial condition or results of operations. In addition,environmental laws and regulations are constantly evolving and it is notpossible to predict accurately the effect they may have in future periods.

**Available Information**

We file annual and quarterly reports and otherinformation with the SEC. You may read and copy any documents we file at theSEC’s public reference room at 450 Fifth Street, N.W., Washington, D.C. 20549.Please call the SEC at 1-800-SEC-0330 for further informationon the public reference room. Our SEC filings are also available to the publicfree of charge at the SEC’s website at*www.sec.gov.*

You may also access ourpress releases, financial information and reports filed with the SEC (forexample, our Annual Report on Form 10-K, our Quarterly Reports on Form 10-Qand our Current Reports on Form 8-K and any amendments to thoseforms) online at *www.vwr.com.* Copies of anydocuments on our website are available without charge, and reports filed withor furnished to the SEC will be available as soon as reasonably practicableafter they are filed with or furnished to the SEC. The information found on ourwebsite is not part of this or any other report filed with or furnished to theSEC.

**Corporate Information**

Our principal executive offices are located at 1310Goshen Parkway, P.O. Box 2656, West Chester, PA 19380 and our telephonenumber is (610) 431-1700. Our Internet website is located at *www.vwr.com.*

9

----

**ITEM 1A.**        RISKFACTORS

***Our business is subject to a number of important risksand uncertainties that are described below. You should carefully consider theserisks and all other information included in this Annual Report on Form 10-K.***

**RiskFactors Related to Our Capital Structure**

**Wehave substantial existing debt and may incur substantial additional debt, whichcould adversely affect our financial health and our ability to obtain financingin the future, react to changes in our business and make payments on our debt.**

As of December 31, 2005, we had an aggregateprincipal amount of debt outstanding of $1,393.4 million.

The agreements governing our debt permit us to incuror guarantee additional indebtedness, including indebtedness under the SeniorSecured Credit Facility, subject to specified limitations. We have additionalborrowing capacity on a revolving credit basis under the Senior Secured CreditFacility of $138.4 million as of December 31, 2005, which theselimitations permit us to incur. We may incur substantial additional debt in thefuture.

Our substantialdebt could have important consequences to us. Because of our substantial debt:

·       ourability to engage in acquisitions without raising additional equity orobtaining additional debt financing may be impaired in the future;

·       ourability to obtain additional financing for working capital, capitalexpenditures, acquisitions or general corporate purposes and our ability tosatisfy our obligations with respect to our indebtedness may be impaired in thefuture;

·       asubstantial portion of our cash flow from operations must be dedicated to thepayment of principal and interest on our indebtedness, thereby reducing thefunds available to us for other purposes;

·       wewill be exposed to the risk of increased interest rates because a portion ofour borrowings will be at variable rates of interest; and

·       ourflexibility to adjust to changing market conditions and ability to withstandcompetitive pressures could be limited, and we may be more vulnerable to adownturn in general economic conditions or our business or be unable to carryout capital spending that is necessary or important to our growth strategy andour efforts to improve operating margins.

The Company is the sole obligor under the SeniorDiscount Notes. Our subsidiaries do not guarantee our obligations under theSenior Discount Notes and do not have any obligation with respect to the SeniorDiscount Notes. The Senior Discount Notes are structurally subordinated to thedebt and liabilities of our existing and future subsidiaries, includingborrowings under the Senior Secured Credit Facility and the VWR Notes. We donot have access to the cash flow and other assets of our subsidiaries that maybe needed to make payments on the Senior Discount Notes. The debt of oursubsidiaries significantly restricts our abilities to pay the Senior DiscountNotes.

The agreements and instruments governing our debtcontain restrictions and limitations that could significantly impact ourability to operate our business.

10

----

**Ourability to generate the significant amount of cash needed to pay interest andprincipal on our debt when due and our ability to refinance all or a portion ofour indebtedness or obtain additional financing, may depend on many factorsbeyond our control.**

Our ability to makescheduled payments or to refinance our obligations with respect to our debtdepends on our financial and operating performance, which, in turn, is subjectto prevailing economic and competitive conditions and to the following financialand business factors, some of which may be beyond our control:

·       operatingdifficulties;

·       increasedoperating costs;

·       decreaseddemand for our products;

·       marketcyclically;

·       productprices;

·       theresponse of competitors;

·       regulatorydevelopments;

·       failureto successfully integrate acquisitions; and

·       delaysin implementing strategic projects.

If our cash flow andcapital resources are insufficient to fund our debt service obligations, we maybe forced to further reduce or delay capital expenditures, sell assets or seekto obtain additional equity capital, or restructure our debt. In the future,our cash flow and capital resources may not be sufficient for payments ofinterest on and principal of our debt, and such alternative measures may not besuccessful and may not permit us to meet our scheduled debt serviceobligations. We also cannot assure you that we will be able to refinance any ofour indebtedness or obtain additional financing, particularly because of ourhigh levels of debt and the debt incurrence restrictions imposed by theagreements governing our debt, as well as prevailing market conditions. In theabsence of such operating results and resources, we could face substantialliquidity problems and might be required to dispose of material assets oroperations to meet our debt service and other obligations. If required, wecannot be sure as to the timing of such sales or the proceeds that we couldrealize therefrom.

**Risk Factors Related to Our Business**

**Asignificant stockholder controls our business and its interests may not be inline with yours.**

As of March 24, 2006,Clayton, Dubilier & Rice Fund VI Limited Partnership (“CD&R FundVI”) is a significant stockholder that beneficially owns approximately 71.8% ofour outstanding common stock and exercises control over matters requiringstockholders’ approval and control over our policies and affairs. It has theright to nominate for election all members of our Board of Directors. Inaddition, Clayton, Dubilier & Rice, Inc. (“CD&R”), which managesCD&R Fund VI, provides us with financial advisory and management consultingservices. See “Item 13—Certain Relationships and Related Transactions.” We havenot instituted any formal plans to address any conflicts of interest that mayarise.

**Thedemand for our products depends on the level of our customers’ R&D andother scientific endeavors. Our business, financial condition and results ofoperations may be harmed if our customers spend less on these activities.**

Our customers are engagedin research, development and production in the pharmaceutical, biotechnology,industrial, education and other markets. The amount of customer spending onresearch, 

11

----

developmentand production has a large impact on our sales and profitability. Our customersdetermine the amounts that they will spend on the basis of, among other things,available resources and their need to develop new products, which, in turn, isdependent upon a number of factors, including their competitors’ research,development and production initiatives. In addition, consolidation in theindustries in which our customers operate may have an impact on such spendingas customers integrate acquired operations, including R&D departments andtheir budgets. Our customers finance their R&D spending from private andpublic sources. Government funding of scientific research and education hasvaried for several reasons, including general economic conditions, growth inpopulation, political priorities, changes in the number of students and otherdemographic changes. A reduction in spending by our customers could have amaterial adverse effect on our business, financial condition and results ofoperations.

**Wecompete in a highly competitive market. Failure to compete successfully couldhave a material adverse effect on our business, financial condition and resultsof operations.**

We compete globally with two other major distributors,Fisher Scientific International Inc. and Sigma-Aldrich Corporation, as well asmany smaller regional, local and specialty distributors, and with manufacturersselling directly to their customers. The bases upon which we compete includeprice, service and delivery, breadth of customer support, e-businesscapabilities and the ability to meet the special requirements of customers.

Some of our competitorsmay have greater financial and other resources than we do. Most of our productsare available from several sources, and some of our customers haverelationships with several distributors. Our agreements with customersgenerally provide that the customer can terminate the agreement or reduce thescope of services provided pursuant to the agreement with short or no notice.The unavailability of products, stemming from either our inability to acquireproducts or interruptions in the supply of products from manufacturers, couldhave a material adverse effect on our ability to compete. Our competitors couldalso obtain exclusive rights to distribute some products, thereby foreclosingour ability to distribute these products. Vertically integrated distributorsmay also have an advantage with respect to the total delivered product cost ofcertain of their captive products. Additionally, manufacturers could increasetheir efforts to sell directly to consumers and effectively bypass distributorslike us. Consolidation in the research laboratory distribution business couldresult in existing competitors increasing their market share through businesscombinations, which could have a material adverse effect on our business,financial condition and results of operations. The entry of new distributors inthe industry could also have a material adverse effect on our ability tocompete.

**Ourbusiness, financial condition and results of operations depend upon maintainingour relationships with manufacturers.**

We currently offer over 1,200,000 products from morethan 2,500 manufacturers. We are dependent on these manufacturers for oursupply of products.

Our ability to sustain our gross margins has been, andwill continue to be, dependent in part upon our ability to obtain favorableterms from our manufacturers. These terms may be subject to changes from timeto time by manufacturers and such changes could adversely affect our grossmargins over time.

The loss of one or more of our large manufacturers, amaterial reduction in their supply of products to us, or material changes inthe terms we obtain from them, could have a material adverse effect on ourbusiness, financial condition and results of operations.

Some of our competitorsare increasing their manufacturing operations both internally and throughacquisitions of manufacturers, including manufacturers that supply products tous. To date, we have not experienced an adverse impact on our ability tocontinue to source products from manufacturers that have 

12

----

beenvertically integrated, although there is no assurance that we will notexperience such an impact in the future.

**Wemay be unable to manage certain operational functions of our business if we arenot able to replace the transition, administrative and other services that areprovided to us by Merck KGaA after our agreements with them expire or areterminated. Further, any disruptions in Merck KGaA’s operations may negativelyimpact our operations.**

We are dependent on MerckKGaA for certain information technology services pursuant to a five-yearinformation services master agreement as well as warehousing and logisticsservices pursuant to a logistics service level agreement. For our Europeansubsidiaries, these services comprise a significant portion of our operationalinfrastructure, including the operation and support of the main enterpriseresource planning and business warehouse software and databases. If Merck KGaAterminates any of these agreements at the end of their respective terms orotherwise, we will need to find an alternative supplier of, or create our owninfrastructure for, these services. While we have already replaced some ofthese services, we may not be able to create our own infrastructure in a timelyor cost-effective manner or obtain replacement services for the remainingservices on terms that are as favorable to us as the current arrangements or onacceptable terms, if at all. In addition, any disruptions in the operationalinfrastructure or operations of Merck KGaA may negatively impact our operations.

**If wedo not comply with or become subject to more onerous government regulations, wecould be adversely affected.**

Some of the products we offer and our operations aresubject to a number of complex and stringent laws and regulations governing theproduction, handling, transportation and distribution of chemicals, drugs andother similar products, including the operating and security standards of theUnited States Drug Enforcement Administration, the Bureau of Alcohol, Tobacco,Firearms and Explosives, the Food and Drug Administration, the Bureau ofIndustry and Security and various state boards of pharmacy as well ascomparable state and foreign agencies. In addition, our logistics activitiesmust comply with the rules and regulations of the Department ofTransportation, the Federal Aviation Administration and similar foreignagencies. While we believe we are in compliance in all material respects withsuch laws and regulations, any non-compliance could result in substantial finesor otherwise restrict our ability to provide competitive distribution servicesand thereby have an adverse impact on our financial condition.

We cannot assure you thatexisting laws and regulations will not be revised or that new more restrictivelaws will not be adopted or become applicable to us or the products that wedistribute. We cannot assure you that the manufacturers of products that maybecome subject to more stringent laws will not try to recover any or allincreased costs of compliance from us by increasing the prices at which wepurchase products from them, or, that we will be able to recover any suchincreased prices from our customers. We cannot further assure you that ourbusiness and financial condition will not be materially and adversely affectedby future changes in applicable laws and regulations.

**Ifany of our operations are found not to comply with applicable antitrust orcompetition laws, our business may suffer.**

Our operations are subjectto applicable antitrust and competition laws in the countries in which weconduct our business, in particular the U.S. and the European Union. These lawsprohibit, among other things, anticompetitive agreements and practices. If anyof our commercial agreements are found to violate or infringe such laws, we maybe subject to civil and other penalties and/or third party claims for damages.Further, agreements that infringe these laws may be void and unenforceable, inwhole or in part, or require modification in order to be lawful andenforceable. If we are unable to enforce any of our commercial 

13

----

agreements,whether at all or in material part, our business could be adversely affected.For further information see “Item 3—Legal Proceedings.”

**Weare subject to environmental, health and safety laws and regulations, and coststo comply with such laws and regulations, or any liability or obligationimposed under such laws or regulations, could negatively impact our business,financial condition and results of operations.**

We are subject to a broad range of foreign, federal,state and local environmental, health and safety laws and regulations,including those pertaining to air emissions, water discharges, the handling,disposal and transport of solid and hazardous materials and wastes, theinvestigation and remediation of contamination and otherwise relating to healthand safety and the protection of the environment and natural resources. As ourglobal operations involve and have involved the handling, transport anddistribution of materials that are or could be classified as toxic orhazardous, there is some risk of contamination and environmental damageinherent in our operations and the products we handle, transport anddistribute. Our environmental, health and safety liabilities and obligationsmay result in significant capital expenditures and other costs, which couldnegatively impact our business, financial condition and results of operations.We may be fined or penalized by regulators for failing to comply withenvironmental, health and safety laws and regulations. In addition,contamination resulting from our current or past operations may triggerinvestigation or remediation obligations, which may have a material adverseeffect on our business, financial condition and results of operations.

Based on currentinformation, we believe that any costs we may incur relating to environmentalmatters will not be material. We cannot be certain, however, thatidentification of presently unidentified environmental conditions, morevigorous enforcement by regulatory authorities or other unanticipated eventswill not arise in the future and give rise to additional environmentalliabilities, compliance costs or penalties which could have a material adverseeffect on our business, financial condition or results of operations. Inaddition, environmental laws and regulations are constantly evolving and it isnot possible to predict accurately the effect they may have in future periods.

**Weare subject to product liability and other claims in the ordinary course ofbusiness.**

Our business involves a risk of product liability andother claims in the ordinary course of business. We maintain insurancepolicies, including product liability insurance, and in many cases we haveindemnification rights against such claims from the manufacturers of the productswe distribute. We cannot assure you that our insurance coverage or themanufacturers’ indemnity will be available in all pending or any future casesbrought against us. In addition, our ability to recover under insurance orindemnification arrangements is subject to the financial viability of theinsurers and manufacturers. Insurance for some liabilities, including asbestos,is not available. Accordingly, we could be subject to uninsured andunidentified future liabilities, and an unfavorable result in a case for whichadequate insurance or indemnification is not available could result in amaterial adverse effect on our business, financial condition and results ofoperations.

From time to time, we are named as a defendant incases as a result of our distribution of scientific supplies, includinglitigation resulting from the distribution of products containing asbestos byus and certain of our predecessors. While the impact of this litigation on ushas typically been immaterial, there can be no assurance that the impact of thepending and any future claims will not be material to our business, financialcondition and results of operations in the future. For further information, see“Item 3—Legal Proceedings.”

14

----

**Theloss of key personnel could harm our business, financial condition and resultsof operations.**

We depend heavily on theservices of our senior management. We believe that our future success willdepend upon the continued services of our management. Our business may beharmed by the loss of one or more members of our management. We currently donot maintain key-man life insurance with respect to our executive officers.

**Ourinternational operations pose currency risks.**

While we report ourfinancial results in U.S. dollars, we derive a significant portion of our salesand incur costs in foreign currencies from our operations outside the UnitedStates. For example, in 2005 and 2004, approximately 41% and 40% of our netsales respectively, came from our operations outside the United States,primarily from our operations in Europe and Canada. Because the majority of ourdebt is denominated in U.S. dollars, fluctuations in exchange rates betweennon-U.S. currencies (principally the Euro, the British pound sterling and theCanadian dollar) relative to the U.S. dollar could make it more difficult forus to pay amounts due on our debt.

**Theinternational scope of our operations may adversely affect our business.**

We deriveapproximately 41% of our net sales from our operations outside the UnitedStates and the Company plans to expand sourcing and commercial operations intoAsia and Eastern Europe. Accordingly, we face certain risks, including:

·       restrictionson foreign ownership of subsidiaries;

·       tariffsand other trade barriers;

·       politicalrisks;

·       differinglaws or administrative practices; and

·       potentiallyadverse tax consequences of operating in multiple jurisdictions.

Further, an adverse changein laws or administrative practices in countries within which we operate couldhave a material adverse effect on us.

**Failureof our information technology systems could significantly disrupt ouroperations, which could reduce our customer base and could harm our business,financial condition and results of operations.**

Our success depends, in part, on the secure anduninterrupted performance of our information technology systems. Our computersystems as well as those of our service providers are vulnerable to damage froma variety of sources, including telecommunications failures, malicious humanacts and natural disasters. Moreover, despite network security measures, someof our servers and those of our service providers are potentially vulnerable tophysical or electronic break-ins, computer viruses and similar disruptive problems.While we have taken appropriate steps to reinforce the security of ourwebsites, there can be no guarantee that unauthorized intrusion will not occur.Failure to maintain a secure web-based procurement system could have a materialadverse effect on our business, financial condition and results of operations.

Despite the precautions we have taken, unanticipatedproblems may nevertheless cause failures in our information technology systems.Sustained or repeated system failures that interrupt our ability to processorders and deliver products in a timely manner could have a material adverseeffect on our business, financial condition and results of operations.

15

----

We are continuing toimplement a single technology platform in Europe. If these technology systemsupgrades are not properly executed or the upgraded systems encounter problemsor fail, it could have a material adverse effect on our business, financialcondition and results of operations.

**Wehave not registered and in some cases do not own the existing applications andregistrations for our material trademarks or service marks in every country inwhich we do business.**

We maintain operations in 18 countries. We also exportproducts from our distribution facilities in North America and Europe to marketsin Central America, South America, British Commonwealth countries, NorthAfrica, the Middle East and the Pacific Rim. We have not sought to register ourmaterial trademarks and service marks in all of these countries and may beblocked from doing so by others who have already registered identical orsimilar marks for similar goods or services. In addition, if we do business incountries where other companies may have registered identical or similartrademarks or service marks, we run the risk of being sued for infringement.

The failure to own andhave enforceable rights in the trademarks and service marks used in ourbusiness could have a material adverse effect on our business, financialcondition and results of operations.

**Werely upon third parties to manufacture and ship products to us and to ourcustomers and interruptions in their operations could harm our business,financial condition and results of operations.**

We are dependent onthird-party manufacturers to supply us products. In addition, we shipsubstantially all our orders through various independent package deliveryproviders. Strikes or other service interruptions by our manufacturers orcarriers could cause our operating expenses to rise or seriously harm ourability to fulfill our customers’ orders or deliver products on a timely basisor both, which could have a material adverse effect on our business, financialcondition and results of operations.

**Wemay continue to engage in acquisitions or business combinations that are besubject to a variety of other risks that could harm our business.**

We may continue toengage in selective acquisitions from time to time. Any future acquisitionscould result in a variety of other risks:

·       wemay need to spend substantial operational, financial and management resourcesin integrating new businesses, technologies and products, and management mayencounter difficulties in integrating the operations, personnel or systems ofthe acquired business;

·       futureacquisitions or business combinations might have a material adverse effect onour business relationships with customers or manufacturers, or both, and couldlead to a termination of or otherwise affect our relationships with suchcustomers or manufacturers;

·       wemay assume substantial actual or contingent liabilities;

·       wemay incur substantial unanticipated costs or other problems associated withacquired businesses; and

·       wemay not be able to retain the key personnel, customers and suppliers of theacquired business.

**ITEM 1B.**       UNRESOLVEDSTAFF COMMENTS

None.

16

----

**ITEM 2.**                PROPERTIES

We ownand lease office and warehouse space in North America and Europe. We maintainour corporate headquarters in West Chester, Pennsylvania for executive,financial, information systems, marketing and other administrative activities.Our European executive, financial, information systems, marketing and otheradministrative activities are in Darmstadt, Germany and Haasrode, Belgium. Asof December 31, 2005, the following table sets forth information withrespect to our significant distribution, manufacturing and other officefacilities:

| **Location**                  | ** ** | **Owned/Leased** | ** ** | **Size**        | ** ** | **Type of Facility**     | ** ** |
|-------------------------------|------------|------------------|------------|-----------------|------------|------------------------------------|------------|
| Batavia, Illinois             |       | Owned            |       | 300,000 sq. ft. |       | Distribution  Center               |       |
| Briare, France                |       | Owned/Leased     |       | 358,675 sq. ft. |       | Distribution/Manufacturing  Center |       |
| Bridgeport, New  Jersey       |       | Owned/Leased     |       | 466,776 sq. ft. |       | Distribution  Center               |       |
| Brisbane,  California         |       | Leased           |       | 248,280 sq. ft. |       | Distribution  Center               |       |
| Bruchsal, Germany             |       | Owned            |       | 108,339 sq. ft. |       | Distribution  Center               |       |
| Buffalo, New York             |       | Owned            |       | 127,000 sq. ft. |       | Distribution  Center               |       |
| Darmstadt,  Germany           |       | Leased           |       | 45,348 sq. ft.  |       | Offices                            |       |
| Denver, Colorado              |       | Leased           |       | 130,091 sq. ft. |       | Distribution  Center               |       |
| Haasrode, Belgium             |       | Owned            |       | 201,447 sq. ft. |       | Offices/Distribution/Manufacturing |       |
| Karlskoga, Sweden             |       | Leased           |       | 129,167 sq. ft. |       | Distribution  Center               |       |
| Lutterworth,  United Kingdom  |       | Leased           |       | 183,205 sq. ft. |       | Distribution  Center               |       |
| Milan, Italy                  |       | Leased           |       | 13,563 sq. ft.  |       | Distribution  Center               |       |
| Mississauga,  Ontario, Canada |       | Leased           |       | 114,000 sq. ft. |       | Distribution  Center               |       |
| Mollet del  Valles, Spain     |       | Leased           |       | 33,480 sq. ft.  |       | Offices/Distribution  Center       |       |
| Rochester, New  York          |       | Owned            |       | 286,260 sq. ft. |       | Distribution/Manufacturing  Center |       |
| Suwanee, Georgia              |       | Leased           |       | 168,925 sq. ft. |       | Distribution  Center               |       |
| West Chester,  Pennsylvania   |       | Leased           |       | 97,516 sq. ft.  |       | Offices                            |       |

 

We also lease over 20service centers in North America and Europe that support our sales andwarehouse functions.

**ITEM 3.**                LEGALPROCEEDINGS

Our business involves a risk of product liability andother claims in the ordinary course of business. We maintain insurancepolicies, including product liability insurance, and in many cases we haveindemnification rights against such claims from the manufacturers of theproducts we distribute. We cannot assure you that our insurance coverage or themanufacturers’ indemnities will be available in all pending or any future casesbrought against us. In addition, our ability to recover under insurance orindemnification arrangements is subject to the financial viability of theinsurers and manufacturers. Insurance for some liabilities, including asbestos,is not available. Accordingly, we could be subject to uninsured andunidentified future liabilities, and an unfavorable result in a case for whichadequate insurance or indemnification is not available could result in amaterial impact on our business, financial condition and results of operations.

During 2005, the German Federal Cartel Officeinitiated an investigation with regard to our European Distribution Agreementwith Merck KGaA. The purpose of the investigation is to determine whether thisagreement violates or otherwise infringes the general prohibition ofanti-competitive agreements under either German or EU rules. The Company hassubmitted information to the German Federal Cartel Office and is awaitingfeedback in connection with this matter. At the current time we cannot assessthe likely outcome of the investigation or potential economic impact associatedwith an adverse ruling. In connection with the Acquisition, we recordedintangible assets of approximately €24.8 million (or $29.4million on a U.S. dollar equivalent basis as of December 31, 2005) related to our 

17

----

European DistributionAgreement with Merck KGaA. As of December 31, 2005, the unamortized netbook value of these intangible assets is approximately €20.4million (or $24.2 million on a U.S. dollar equivalent basis).

On March 28, 2006, the Company was served with acomplaint filed in the United States District Court, Western District of NewYork, by a former supplier alleging a breach of contract and unliquidateddamages. The Company will vigorously defend itself in this matter. Untilfurther information is obtained we cannot assess the likely outcome of thislitigation.

From time to time, we arenamed as a defendant in cases as a result of our distribution of scientificsupplies, including litigation resulting from the distribution of productscontaining asbestos by us and certain of our predecessors. Until 1987, wedistributed certain asbestos-containing products primarily for use inlaboratories, including pads, protective clothing and laboratory equipment.Individuals who were exposed to these asbestos-containing products have, fromtime to time, brought claims against us for asbestos-related injuries. Webelieve that the liabilities associated with asbestos-related claims currentlypending against us are not material. While liabilities arising from potentialfuture claims could become material, we currently believe, on the basis of ourclaims history and related factors, that such potential future claims are notlikely to have a material impact on our business, financial condition andresults of operations.

**ITEM 4.**                SUBMISSIONOF MATTERS TO A VOTE OF SECURITY HOLDERS

None.

18

----

**PART II**

**ITEM 5.**               MARKETFOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUERPURCHASES OF EQUITY SECURITIES

**Market Information**

There is no establishedpublic trading market for our common stock. The estimated fair market value onour common stock as of December 31, 2005 was $75 per share. The number ofshares of our common stock outstanding at March 24, 2006 was 5,756,451 andwe had 208 holders of record of our common stock.

**Dividends**

We did not pay any cash dividends on our common stockduring 2005 or 2003. In 2004, we issued $481.0 million aggregate principalamount at maturity ($299.4 million gross proceeds) of Senior Discount Notes.The net proceeds from the issuance of the Senior Discount Notes ofapproximately $297.9 million were used to pay a dividend to holders of ourcommon stock. Our debt instruments restrict our ability to pay dividends. See “Item7—Management’s Discussion and Analysis of Financial Condition and Results ofOperations—Indebtedness Following the Acquisition.” We do not anticipate payingcash dividends on our common stock at any time in the foreseeable future.

**EquityCompensation Plans**

Thefollowing is a summary of our equity compensation plan information as of December 31,2005:

| ** **                                                        | ** ** | ** **                                 | ** ** | ** **                           | ** ** | **Number of Securities**  | ** ** |
|-------------------------------------------------------------------|------------|--------------------------------------------|------------|--------------------------------------|------------|-------------------------------------|------------|
| ** **                                                        | ** ** | ** **                                 | ** ** | ** **                           | ** ** | **Remaining for Future**  | ** ** |
| ** **                                                        | ** ** | ** **                                 | ** ** | ** **                           | ** ** | **Issuance Under Equity** | ** ** |
| ** **                                                        | ** ** | **Number of Securities to** | ** ** | **Weighted-Average**                 | ** ** | **Compensation Plans**         | ** ** |
| ** **                                                        | ** ** | **be Issued Upon Exercise** | ** ** | **Exercise Price of**      | ** ** | **(Excluding Securities**      | ** ** |
| **Plan Category**                                            | ** ** | ** **                                 | ** ** | **of Outstanding Options** | ** ** | **Outstanding Options**        | ** ** | **Reflected in Column (a))** | ** ** |
| ** **                                                        | ** ** | **(a)**                                    | ** ** | **(b)**                              | ** ** | **(c)(1)**                          | ** ** |
| Equity  compensation plans approved by security holders      |       |                                       | 483,728    |                                 |       |                                | $          | 51.24 |   |   |   | 172,115 |   |   |
| Equity  compensation plans not approved by security holders  |       |                                       | —     |                                 |       |                                | —     |   |   |   | — |   |   |
| Total at  December 31, 2005                                  |       |                                       | 483,728    |                                 |       |                                | $          | 51.24 |   |   |   | 172,115 |   |   |
|                                                                   |            |                                            |            |                                      |            |                                     |            |  |  |  |  |  |  |  |  |  |

----

(1)          Includes the securitiesunderlying 21,333 restricted stock units granted under the CDRVInvestors, Inc. Stock Incentive Plan that are currently unvested.

**Recent Sales of our Common Stock**

In March 2006, we sold 19,643 shares of ourcommon stock to our new President and Chief Executive Officer for a purchase priceof $56.00 per share pursuant to his amended employment agreement. In connectionwith his purchase, he received a grant of 58,929 options to purchase shares ofour common stock at $75.00 per share, which we believe was the fair marketvalue of a share on the grant date. The options granted will vest in equalannual installments on each of the first five anniversaries of the grant date,and will expire ten years from the grant date.

During 2005, we offered certain of our officers andemployees the opportunity to purchase shares of our common stock for a purchaseprice equal to $56.00 per share, which we believe was the fair market    value of a share on the offer date. Thoseparticipants who are not also executive officers were offered financingassistance to help purchase their shares through a loan facility that wearranged through a third-party financial institution. Participants were grantedoptions to purchase two additional shares of our common stock for each sharethey purchased. All options were granted with an exercise price per share thatwe believe was equal to the fair market value of our common stock on the dateof grant. The options 

19

----

granted will vest in equalannual installments on each of the first five anniversaries of the grant date,and will expire ten years from the grant date.

During 2005, the Company closed offerings in respectof 18 of our officers and employees, and 1 of our directors. These officers,employees, and director purchased a total of 23,407 shares and were grantedoptions to purchase 45,920 shares. Upon the closing of these offerings, theproceeds of approximately $1.3 million were paid to the Company, which in turncontributed the $1.3 million to VWR as an additional investment. In connectionwith the acquisition of Advanced Instruments Sales &Services, Inc. during 2005, discussed in Note 5(b) to theConsolidated Financial Statements, the Company issued 8,929 shares, asconsideration (for value of $0.5 million), and granted options to purchase17,858 shares. In addition, we issued 5,625 shares to certain directors who arenot also employees or associated with CD&R for directors’ compensation in2005.

The securities issued in the transactions describedabove were deemed exempt from registration under the Securities Act in relianceupon Regulation D, Section 4(2) or Rule 701 of the SecuritiesAct as transactions by an issuer not involving a public offering, ortransactions pursuant to compensatory benefit plans and contracts relating tocompensation. The recipients of securities in each of such transactionsrepresented their intentions to acquire the securities for investment only andnot with a view to or for sale in connection with any distribution of thesecurities. All recipients were either furnished with or had adequate accessto, through their relationship with us, information about the Company.

20

----

**ITEM 6.**               SELECTED FINANCIALDATA

Theselected financial data below for each of the years in the five-year periodended December 31, 2005 are derived from our historical consolidated andcombined financial statements. These consolidated and combined financialstatements have been audited by KPMG LLP (“KPMG”), an independent registeredpublic accounting firm. You should read the following selected financial datain conjunction with “Management’s Discussion and Analysis of FinancialCondition and Results of Operations” and the Financial Statements presentedelsewhere herein. The term “predecessor” refers to VWR InternationalCorporation prior to the Acquisition. The term “successor” refers to CDRVInvestors, Inc. following the Acquisition.

| ** **                                                                                   | ** ** | **Successor**                       | ** ** | ** **              | ** ** | **Predecessor** | ** ** |
|----------------------------------------------------------------------------------------------|------------|-------------------------------------|------------|-------------------------|------------|-----------------|------------|
| ** **                                                                                   | ** ** | **Year Ended**                 | ** ** | **April 7 –** | ** ** | ** **      | ** ** | **January 1 –** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                                                                                   | ** ** | **December 31,**               | ** ** | **December 31,**   | ** ** | ** **      | ** ** | **April 6,** | ** ** | **Years Ended December 31,** | ** ** |
| ** **                                                                                   | ** ** | **2005**                            | ** ** | **2004**                | ** ** | ** **      | ** ** | **2004** | ** ** | **2003** | ** ** | **2002** | ** ** | **2001** | ** ** |
| ** **                                                                                   | ** ** | **(Consolidated)**                  | ** ** | **(Consolidated)**      | ** ** | ** **      | ** ** | **(Consolidated)** | ** ** | **(Consolidated)** | ** ** | **(Combined)** | ** ** | **(Combined)** | ** ** |
| ** **                                                                                   | ** ** | **(Dollars in millions)** | ** ** |
| **Income Statement Data:**                                                                   |       |                                |       |                    |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Sales                                                                                    |       |                                | $          | 3,138.2                 |       |            |       | $ | 2,212.2 |   |   |   |   |   | $ | 793.2 |   |   |   | $ | 2,794.2 |   |   |   | $ | 2,624.1 |   |   |   | $ | 2,522.4 |   |   |
| Cost of goods sold                                                                           |       |                                | 2,334.5    |                    |       |            | 1,652.7    |   |   |   |   |   | 588.0 |   |   |   | 2,078.1 |   |   |   | 1,950.1 |   |   |   | 1,886.1 |   |   |
| Gross profit                                                                                 |       |                                | 803.7      |                    |       |            | 559.5      |   |   |   |   |   | 205.2 |   |   |   | 716.1 |   |   |   | 674.0 |   |   |   | 636.3 |   |   |
| Selling, general and administrative expenses(3)                                              |       |                                | 640.0      |                    |       |            | 455.6      |   |   |   |   |   | 163.7 |   |   |   | 583.4 |   |   |   | 560.0 |   |   |   | 573.7 |   |   |
| Restructuring and other charges(2)                                                           |       |                                | 20.6       |                    |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | 11.5 |   |   |
| Operating income                                                                             |       |                                | 143.1      |                    |       |            | 103.9      |   |   |   |   |   | 41.5 |   |   |   | 132.7 |   |   |   | 114.0 |   |   |   | 51.1 |   |   |
| Interest expense, net                                                                        |       |                                | 104.0      |                    |       |            | 51.9       |   |   |   |   |   | 5.6 |   |   |   | 24.4 |   |   |   | 39.4 |   |   |   | 74.1 |   |   |
| Other (income) expense, net                                                                  |       |                                | (3.8       | )                       |       |            | (2.1       | ) |   |   |   |   | 0.1 |   |   |   | (3.0 | ) |   |   | 0.6 |   |   |   | 2.4 |   |   |
| Income (loss) before income taxes and cumulative  effect of changes in accounting principles |       |                                | 42.9       |                    |       |            | 54.1       |   |   |   |   |   | 35.8 |   |   |   | 111.3 |   |   |   | 74.0 |   |   |   | (25.4 | ) |   |
| Income tax provision                                                                         |       |                                | 20.9       |                    |       |            | 23.0       |   |   |   |   |   | 15.1 |   |   |   | 46.2 |   |   |   | 29.7 |   |   |   | 7.0 |   |   |
| Income (loss) before cumulative effect of changes in  accounting principles                  |       |                                | 22.0       |                    |       |            | 31.1       |   |   |   |   |   | 20.7 |   |   |   | 65.1 |   |   |   | 44.3 |   |   |   | (32.4 | ) |   |
| Cumulative effect of changes in accounting  principles(1)(3)                                 |       |                                | (0.5       | )                       |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |   | (43.8 | ) |   |   | — |   |   |
| Net income (loss)                                                                            |       |                                | $          | 21.5                    |       |            |       | $ | 31.1 |   |   |   |   |   | $ | 20.7 |   |   |   | $ | 65.1 |   |   |   | $ | 0.5 |   |   |   | $ | (32.4 | ) |   |
| **Other  Financial Data:**                                                                   |       |                                |       |                    |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization(3)                                                             |       |                                | $          | 33.9                    |       |            |       | $ | 25.8 |   |   |   |   |   | $ | 8.9 |   |   |   | $ | 32.9 |   |   |   | $ | 32.6 |   |   |   | $ | 82.6 |   |   |
| Capital expenditures                                                                         |       |                                | 18.4       |                    |       |            | 13.1       |   |   |   |   |   | 3.3 |   |   |   | 16.6 |   |   |   | 41.0 |   |   |   | 28.2 |   |   |
| Gross profit as a percentage of net sales                                                    |       |                                | 25.6       | %                       |       |            | 25.3       | % |   |   |   |   | 25.9 | % |   |   | 25.6 | % |   |   | 25.7 | % |   |   | 25.2 | % |   |
| Ratio of earnings  to fixed charges(4)                                                       |       |                                | 1.4        | x                       |       |            | 1.9        | x |   |   |   |   | 5.1 | x |   |   | 4.1 | x |   |   | 2.4 | x |   |   | — |   |   |

 

| ** **                 | ** ** | **Successor**                       | ** ** | ** **         | ** ** | **Predecessor**       | ** ** |
|----------------------------|------------|-------------------------------------|------------|--------------------|------------|-----------------------|------------|
| ** **                 | ** ** | **December 31,**               | ** ** | ** **         | ** ** | **December 31,** | ** ** |
| ** **                 | ** ** | **2005**                            | ** ** | **2004**           | ** ** | ** **            | ** ** | **2003** | ** ** | **2002** | ** ** | **2001** | ** ** |
| ** **                 | ** ** | **(Consolidated)**                  | ** ** | **(Consolidated)** | ** ** | ** **            | ** ** | **(Consolidated)** | ** ** | **(Combined)** | ** ** | **(Combined)** | ** ** |
| ** **                 | ** ** | **(Dollars in millions)** | ** ** |
| **Balance  Sheet Data:**   |       |                                |       |               |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets               |       |                                | $          | 2,547.3            |       |                  |       | $ | 2,553.4 |   |   |   |   |   | $ | 1,767.9 |   |   |   | $ | 1,705.2 |   |   |   | $ | 1,783.9 |   |   |
| Total debt                 |       |                                | 1,393.4    |               |       |                  | 1,399.1    |   |   |   |   |   | 1,026.0 |   |   |   | 1,100.6 |   |   |   | 1,239.5 |   |   |
| Stockholders’  equity |       |                                | 321.3      |               |       |                  | 338.6      |   |   |   |   |   | 265.4 |   |   |   | 176.9 |   |   |   | 170.2 |   |   |
|                            |            |                                     |            |                    |            |                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

----

(1)             We adopted FASB Interpretation No. 47, *An Interpretation of FASB No. 143*, *Accounting for Asset Retirement Obligations*(“SFAS No. 143”), effective December 31, 2005. SFAS No. 143addresses financial accounting and reporting for obligations associated withthe retirement of tangible long-lived assets and the associated assetretirement costs. SFAS No. 143 requires recognition of a liability at fairvalue and an increase to the carrying value of the related asset for anyretirement obligation. As a result of the adoption, we recognized a non-cashcharge of $0.5 million, net of applicable income taxes of $0.3 million.

21

----

(2)             During 2005, we recorded pre-tax restructuring chargesaggregating $20.6 million to rationalize and streamline our operations. Thesecharges included $17.9 million for severance and termination benefits and $2.7million for facility exit costs.

During 2001, we recorded a pre-tax restructuring chargeof $11.5 million that included a $3.7 million charge for a reorganization ofthe businesses and a charge of $7.8 million for the impairment of certain tradenames in the North American Lab segment.

(3)             We adopted SFAS No. 142, *Goodwill andOther Intangible Assets*, effective January 1, 2002. SFAS No. 142requires that goodwill and certain intangibles with indefinite lives not beamortized, but subject to an impairment test on an annual basis or when factsand circumstances suggest that such assets may be impaired. As a result of thetransitional goodwill impairment evaluation as of January 1, 2002, werecognized a non-cash transitional impairment loss of $43.8 million, which wasnot deductible for tax purposes. In addition, we ceased amortization ofgoodwill effective January 1, 2002. Included in selling, general andadministrative expenses in 2001 is amortization expense of $52.0 million forgoodwill.

(4)             For purposes of calculating the ratio of earnings tofixed charges, (1) earnings is defined as income before income taxes andcumulative effect of a change in accounting principle and equity methodearnings or losses plus fixed charges and distributed earnings of investees,and (2) fixed charges is defined as interest expense (includingamortization of debt issuance costs) and one-third of rental expense (which webelieve is representative of the interest component of rent expense). Earningswere insufficient to cover fixed charges for the year ended December 31,2001 by $25.4 million.

22

----

**ITEM 7.**                MANAGEMENT’SDISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

**Overview**

We generate our net sales through the sale of morethan 1,200,000 products and the provision of value-added services to the globalresearch laboratory market. We generate approximately 75% of our net sales fromthe sale of consumable products. We offer both private label and brandedproducts that we source from more than 2,500 manufacturers.

We have over 250,000 customers. Our customers includepharmaceutical and biotechnology companies, universities and researchinstitutes, governmental agencies and environmental testing organizations. Ourlargest customer accounted for less than 3% of our 2005 net sales.

Since the Acquisition, we have initiated and substantiallycompleted a series of restructuring efforts to re-align our resources and havemade investments in our corporate infrastructure.

The principal tenets of our strategy are outlinedbelow.

***IncreaseProductivity and Profitability.******  ***We believethat there are additional opportunities to further increase the productivityand profitability of our operations. For example, we have realigned our salesforce to promote focused market segmentation and penetration. Another keyopportunity is to develop logistical and supply chain efficiencies includingstandardized operating procedures and initiation of expanded key performancemetrics to help better manage our operations, costs and service delivery. Weplan to continue implementing working capital improvement initiatives.

***Optimize ProductPortfolio.******  ***We currently maintain a large productportfolio in inventories, which creates significant complexity in inventorymanagement. We believe that an opportunity exists to optimize our on-handproduct portfolio.

***Improve SourcingStrategy.***   By utilizing our global scale,strong relationships with our multinational customers and our primary focus ondistribution, we intend to continue developing mutually beneficialrelationships with our leading manufacturers. An important part of our strategyinvolves providing our customers with a choice of products at varying pricepoints. Global sourcing is a key element of this strategy.

***Increase Sales ofPrivate Label Products.***   We intend to directour sales and marketing efforts to grow sales of our private label products,which accounted for approximately 12% of our net sales in 2005. We believe thatthis strategy represents a significant profitability enhancement opportunity.

***Restructuring andOther Operating Initiatives.***   Since theAcquisition, we have initiated various restructuring activities designed torationalize operating costs and improve our operating and administrativecapabilities. The initial focus was on the Company’s European operations andorganization structure and, to a lesser extent, the operations in NorthAmerica. In connection with this initial focus, we recorded restructuringaccruals of $29.7 million in 2004, primarily related to reductions inheadcount in Europe due to the reorganization of our European sales andmarketing functions. In early 2005, we implemented restructuring plans thatwere formulated in 2004 and were in the planning and evaluation stages. Accordingly,we recorded additional restructuring accruals of $24.5 million in 2005,primarily for severance and other exit costs including estimates forenvironmental remediation associated with cessation of manufacturing operationsat a plant in France and severance costs associated with the consolidation ofcertain sales and marketing personnel in our German and UK operations. Thesecharges have been recorded as adjustments to acquisition costs (increases togoodwill) pursuant to the provisions of Emerging Issues Task Force Issue No. 95-3,*Recognition of Liabilities in Connectionwith a Purchase Business Combination*.

23

----

In addition, we initiated cost reduction programs inresponse to relatively static market conditions and implemented reductions inforce and other cost containment measures primarily during the later part of2005 that did not qualify as acquisition costs. In connection with theseactions, we recorded restructuring charges related to severance and facilityexit costs totaling approximately $20.6 million.

***Compliance with Sarbanes-Oxley Act.******  ***We have launched a complianceprogram to address the requirements of Section 404 of the Sarbanes-OxleyAct in anticipation of the mandatory compliance date of December 31, 2007.Compliance with these requirements requires significant incremental internal resourcesand financial investments including, but not limited to, use of outsideexperts, additional audit fees, and potential changes in systems design,security and structure. For the year ended December 31, 2005, we expensedapproximately $3.1 million for external assistance related to ourSarbanes-Oxley compliance program. A component of this program will also focuson the quality, security, and functionality of our information systems. Whilewe have developed sound plans to address our compliance requirements, there canbe no assurance that such efforts will not have an impact on, or otherwisedistract our senior financial team from our operations.

**Basisof Financial Statement Presentation**

On December 31, 2002, Merck KGaA entered into aseries of reorganization transactions whereby all of its legal entities thatcomprised our North American and European businesses were contributed to VWRInternational Corporation and became its wholly-owned subsidiaries. Thefinancial statements for the years ended December 31, 2001 and 2002represent the combined financial statements of the two businesses that havebeen derived from the consolidated financial statements and accounting recordsof Merck KGaA using the historical results of operations and historicalbasis of the assets and liabilities of the individual businesses following acarve-out process for the European business. The financial statements for theyear ended December 31, 2003 and the period January 1 – April 6,2004 include the accounts of VWR International Corporation and itssubsidiaries. On April 7, 2004, Merck KGaA sold all of the outstandingshares of capital stock of VWR International Corporation to CDRV AcquisitionCorporation, a wholly owned subsidiary of CDRV Holdings, Inc., awholly-owned subsidiary of the Company. As a result of the Acquisition, thefinancial statements for the period April 7 – December 31,2004 and the year ended December 31, 2005 include the accounts of CDRVInvestors, Inc. and its subsidiaries. In order to provide a meaningfulbasis of comparing our results of operations for the year ended December 31,2004, the results of operations for the “predecessor” period (January 1 – April 6,2004) have been combined with the results of operations for the “successor”period (April 7 – December 31, 2004). All intercompanyaccounts and transactions have been eliminated.

The purchase price paid by Merck KGaA for thepredecessor businesses was pushed down to VWR International Corporation’sfinancial statements from the date of acquisition and has resulted in theallocation of the purchase price to the assets and liabilities acquired and therecognition of either push down debt due Merck KGaA or a contribution tostockholders’ equity for cash consideration. Interest expense was recorded on thispush down debt based upon Merck KGaA’s intercompany interest rates, whichare not necessarily indicative of rates VWR would have obtained if VWR was not anultimate subsidiary of Merck KGaA. Interest expense, including taxeffects, on push down debt has been included in the statements of operations,and presented as a non-cash item in the accompanying statements of cash flowsand a capital contribution in the statement of stockholders’ equity, as thisinterest was not required to be paid to Merck KGaA.

Management believes theassumptions underlying the predecessor financial statements are reasonable.However, the financial statements, for all periods up to April 6, 2004, donot include allocations of Merck KGaA general corporate expenses or charges forfinancial reporting, tax, and treasury services, as such costs were not chargedto us. Management does not believe that charges for such services would havebeen material. The historical financial information does not reflect the addedcosts that we 

24

----

incur asa separate company. These additional costs include costs for new informationtechnology systems to operate as a separate company, costs of periodicreporting to the SEC, as well as the costs related to a global tax and treasurystaff and compliance with the Sarbanes-Oxley Act of 2002. The historicalfinancial information also does not reflect the incremental costs associatedwith changes in our capital structure and operations.

**Effects of the Acquisition**

The Acquisition has been accounted for using the purchasemethod of accounting. As such, our assets and liabilities were adjusted, as ofthe date of Acquisition, to their respective fair values. This resulted in therecognition of significant identified intangible assets relating to customerrelationships, trademarks and tradenames, an increase in pension andpost-retirement liabilities for existing plans, the recognition of other fairvalue adjustments and the impact of the new debt and equity structure.

The recognition of thefair value of assets acquired resulted in higher net non-cash depreciation andamortization expense. The new debt outstanding resulted in a significantincrease in interest expense. The cash outflow for interest expense ispartially offset by tax deductions associated with such interest expense.

**Constant Currency Analysis**

We maintain operations in North America and in15 European countries. Approximately 41% of our net sales for the yearended December 31, 2005 originated in currencies other than the U.S.dollar, principally the Euro, the British pound sterling and the Canadiandollar. As a result, changes in our revenues and operating profits include theimpact of changes in foreign currency exchange rates. We provide “constantcurrency” calculations in this Annual Report on Form 10-K to removethe impact of the fluctuation in foreign exchange rates.

We utilize constantcurrency results in our analysis of segment performance. This means that wehave translated financial data for a period into U.S. dollars using the sameforeign currency exchange rates that we used to translate financial data forthe previous comparable period. We believe that this calculation is a usefulmeasure, indicating the actual growth of our operations. Earnings from oursubsidiaries are not ordinarily repatriated to the United States, therefore wedo not incur significant gains or losses on foreign currency transactions withour subsidiaries. Therefore, changes in foreign currency exchange ratesprimarily impact only reported earnings and not our actual cash flow oreconomic condition.

**Business Segments**

We report our financialresults on the basis of the following three business segments: North Americanlaboratory distribution, or North American Lab, European laboratorydistribution, or European Lab, and Science Education. Both the North AmericanLab and European Lab segments are comprised of the distribution of scientificsupplies to customers in the pharmaceutical, biotechnology, chemical,technology, food processing, governmental agencies, colleges and universitiesand environmental organizations. Science Education is comprised of themanufacture and distribution of scientific supplies and specialized kitsprincipally to primary and secondary schools in North America.

**Seasonality**

Our results of operationsare subject to seasonal trends primarily affecting our Science Educationsegment, which tend to result in increased net sales and operating income inthe third quarter in comparison to other quarters of the year. For example, in2005 and 2004, approximately 33% and 28%, respectively, of our total operatingincome was generated in the quarter ending September 30. This strongerquarterly performance is typically due to higher sales and operating income inour Science Education segment, as schools purchase supplies in preparation forthe beginning of the new school year, 

25

----

offsetby a seasonal slowdown in our European Lab segment. Quarterly sales are alsoinfluenced by the number of shipping days in a given fiscal quarter.

**Results of Operations**

Our net sales are derived primarily from the sale ofscientific supplies, including laboratory supplies, research chemicals,apparatus, laboratory furniture and services. Freight costs that are billed toour customers are also included in net sales.

Our cost of sales consists primarily of the cost ofinventory shipped and our cost of labor for services provided on site at ourcustomer’s locations, such as storeroom management and product delivery. Costof sales also includes freight expenses incurred to deliver products tocustomers as well as credits for rebates earned from suppliers.

Selling, general and administrative (“SG&A”)expenses primarily reflect the costs of operations dedicated to generating newsales, maintaining existing customer relationships, enhancing technology capabilities,receiving customer orders and maintaining our distribution center facilities.These expenses also include depreciation and amortization.

During the years ended December 31, 2005, 2004and 2003, inflation has not had a significant impact on our results ofoperations as we have been able to pass the majority of these increases throughto our customers. However, our earnings and cash flows could be adverselyaffected if we are unable to pass through future cost increases due toinflation or fuel costs.

On April 1, 2005, the Company acquiredAGB Scientific Ltd. (“AGB”) for initial cash consideration ofapproximately $23.8 million. AGB distributes scientific supplies and isheadquartered in Dublin, Ireland. The results of AGB have been included in theEuropean Lab segment from the date of acquisition. On April 1, 2005, theCompany acquired Advanced Instruments Sales & Service, Inc. (“AI”)for cash consideration of approximately $16.8 million and our stock ofapproximately $0.5 million. AI performs services and distributesscientific supplies to the Puerto Rican market and is headquartered in SanJuan, Puerto Rico. The results of AI have been included in the North AmericanLab segment from the date of acquisition. On July 1, 2005, the Companyacquired Technical Service Lab B.V. (“TSL”) for cash consideration ofapproximately $3.1 million. TSL performs technical services on laboratoryequipment in the Netherlands, Germany, Belgium and France. The results of TSLhave been included in the European Lab segment from the date of acquisition.

AGB had net sales of $26.6 million,gross profit of $7.8 million and operating income of $1.3 millionincluded in our year ended December 31, 2005 results. AI had net sales of$13.5 million, gross profit of $6.2 million and operating income of$1.1 million included in our year ended December 31, 2005 results.TSL had net sales of $1.0 million, gross profit of $0.6 million andoperating income of $0.2 million included in our year ended December 31,2005 results. Had these acquisitions occurred at the beginning of 2004, thepro-forma consolidated statements of operations would not have been materiallydifferent from the amounts reported.

26

----

***Net Sales***

Thefollowing table presents net sales and net sales growth by reportable segmentfor the years ended December 31, 2005, 2004 and 2003 (dollars inmillions):

| ** **         | ** ** | **Years Ended December 31,** | ** ** |
|--------------------|------------|---------------------------------------------|------------|
| ** **         | ** ** | **2005**                                    | ** ** | **% Change** | ** ** | **2004** | ** ** | **% Change** | ** ** | **2003** | ** ** |
| Net Sales          |       |                                        |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab |       | $                                           | 1,902.4    |   |   | 3.5 | % |   | $ | 1,837.2 |   |   | 5.9 | % |   | $ | 1,734.3 |   |
| European Lab       |       | 1,089.8                                     |       |   | 5.3 | % |   | 1,035.3 |   |   | 11.0 | % |   | 932.6 |   |
| Science Education  |       | 146.0                                       |       |   | 9.9 | % |   | 132.9 |   |   | 4.4 | % |   | 127.3 |   |
| Total              |       | $                                           | 3,138.2    |   |   | 4.4 | % |   | $ | 3,005.4 |   |   | 7.6 | % |   | $ | 2,794.2 |   |

 

Net sales for 2005 increased $132.8 million or4.4% over 2004. Our current year acquisitions and the effects of foreigncurrency accounted for $41.1 million and $9.5 million of theincrease, respectively. Excluding these effects, net sales increased 2.7% from2004. All of our segments experienced net sales growth in 2005. Net sales for2004 increased $211.2 million or 7.6% from 2003. Excluding the effects offoreign currency of $108.2 million for 2004, net sales increased by 3.7%from 2003. The vast majority of the 2004 growth expressed in local currencieswas from the North American Lab segment while net sales in the European Labsegment were flat.

Net sales in the North American Lab segment for 2005increased $65.2 million or 3.5%. Our current year acquisition of AI andthe effects of foreign currency accounted for $13.5 million and$13.4 million of the increase, respectively. Excluding these effects, netsales increased 2.1% from 2004. During 2005, our net sales in thebio-pharmaceutical market were relatively flat and our net sales in theeducation and industrial markets achieved low single-digit growth. Net sales inthe North American Lab segment for 2004 increased $102.9 million or 5.9%.Foreign currency changes accounted for $11.8 million of the increase for2004 and our organic growth was relatively broad based across most productgroups, especially chemicals and equipment/instruments.

Net sales in the European Lab segment for 2005increased $54.5 million or 5.3%. Our current year acquisitions of AGB andTSL favorably impacted net sales by $27.6 million and the effects offoreign currency unfavorably impacted net sales by $3.9 million. Excludingthese effects, net sales increased 3.0% from 2004. Our European Lab segmentoperates in fifteen countries and its results are heavily influenced by thelarger countries in which we operate such as Germany, the UK, France, andBelgium. These large markets and the majority of our smaller operations inother countries experienced growth during 2005. This growth was primarilydriven by our bio-pharmaceutical and industrial markets and was partiallyoffset by a decline in our resellers market. Net sales in the European Lab segmentfor 2004 increased $102.7 million or 11.0%. The increase was due to theimpact of favorable currency exchange rates, as sluggish economic conditionsthroughout Europe caused net sales expressed in local currencies to beessentially flat. Foreign currency changes accounted for $96.4 million ofthe 2004 increase.

Net sales in the Science Education segment for 2005increased $13.1 million or 9.9%. This increase was primarily driven byincreased sales in both our education and publishers markets. In addition,during 2005 there were less budget constraints by certain state and localgovernments, which limited the amount of funds available for the purchase ofscientific supplies for school laboratories, as compared to 2004. Net sales inthe Science Education segment for 2004 increased $5.6 million or 4.4%. Theincrease for 2004 was mainly attributable to a strong selling season especiallyduring the third quarter. The positive sales growth during the third quarter of2004 helped offset the sales decline this segment had experienced during thefirst half of 2004 as a result of the budget constraints discussed above.

27

----

***Gross Profit***

Thefollowing table presents gross profit for the years ended December 31,2005, 2004 and 2003 (dollars in millions):

| ** **                              | ** ** | **Years Ended December 31,** | ** ** |
|-----------------------------------------|------------|---------------------------------------------|------------|
| ** **                              | ** ** | **2005**                                    | ** ** | **2004** | ** ** | **2003** | ** ** |
| Gross profit                            |       | $                                           | 803.7      |   | $ | 764.7 |   | $ | 716.1 |   |
| Percentage of net sales  (gross margin) |       | 25.6                                        | %          | 25.4 | % | 25.6 | % |
|                                         |            |                                             |            |  |  |  |  |  |  |  |

 

Gross profit for 2005 increased $39.0 million or 5.1%.Our current year acquisitions and the effects of foreign currency accounted for$14.6 million and $2.0 million of the increase, respectively. Excluding theseeffects, gross profit increased 2.9% from 2004. During 2005, our North AmericanLab margins improved slightly while both the European Lab and Science Educationmargins declined. The European Lab gross margin percentages decreased slightlyas a result of product mix and pricing pressures. Science Education grossmargin percentages decreased as a result of product mix, pricing pressures anda shift in customer buying patterns to open bid or auction purchasing.

Gross profit for 2004increased $48.6 million or 6.8%. Approximately $32.7 million of this growth wasattributable to the effect of currency translation and the balance wasprimarily comprised of the margin effect associated with organic net salesgrowth. For the year ended December 31, 2004 compared to the year ended December 31,2003, our North American Lab margin percentages improved slightly, mainlybecause of higher supplier rebates, while our European Lab margin percentagesdeclined slightly, mainly because of higher product costs for certainchemicals.

***Selling, General and Administrative Expenses***

Thefollowing table presents SG&A expenses, for the years ended December 31,2005, 2004 and 2003 (dollars in millions):

| ** **                                    | ** ** | **Years Ended December 31,** | ** ** |
|-----------------------------------------------|------------|---------------------------------------------|------------|
| ** **                                    | ** ** | **2005**                                    | ** ** | **2004** | ** ** | **2003** | ** ** |
| Selling, general  and administrative expenses |       | $                                           | 640.0      |   | $ | 619.3 |   | $ | 583.4 |   |
| Percentage of net sales                       |       | 20.4                                        | %          | 20.6 | % | 20.9 | % |
|                                               |            |                                             |            |  |  |  |  |  |  |  |

 

Since the Acquisition in April 2004, we madesignificant investments in sales, marketing, and sourcing personnel to supportour strategic growth plans and expanded our finance and administrativecapabilities to support the Company as a stand-alone entity. At the same time,we also implemented various restructuring and cost reduction programs topartially offset the costs of these investments, redirect resources to alignwith our strategy and improve operating effectiveness. As a result, whileSG&A expenses have increased in comparison to the corresponding periods, wehave experienced a reduction in such costs as a percentage of net sales due torestructuring and cost containment efforts.

SG&A expenses for 2005 increased $20.7 million or3.3%. Our current year acquisitions and the effects of foreign currencyaccounted for $12.0 million and $0.7 million of the increase, respectively.Excluding these effects, SG&A expenses increased $8.0 million or 1.3% from2004. This increase primarily reflects our aforementioned investments inpersonnel, inflation, and costs incurred related to our compliance with theSarbanes-Oxley Act. Partially offsetting the increase are savings from ourrestructuring programs and lowerprovisions for bonus of approximately $7.1 million in North America, due toshortfalls from the approved management incentive plan earnings targets.

SG&A expenses for 2004increased $35.9 million or 6.2%. Excluding the effects of foreign exchangetotaling $27.7 million for 2004, SG&A increased by 1.4% from 2003. Staffingreductions resulted in modest 

28

----

declinesin SG&A expenses during the first half of 2004. These declines weresubsequently offset during the third quarter of 2004 by increases in costsassociated with our investment in sales and other strategic and corporatepersonnel.

***Restructuring Charges***

During 2005, we initiatedseveral cost reduction programs in response to relatively static marketconditions and implemented reductions in force and other cost containmentmeasures and recorded pre-tax charges of $20.6 million. In connection withthese actions, we recorded restructuring charges of $5.8 million, primarilyseverance, for North American Lab; $13.8 million, primarily related to theclosing of a facility and the consolidation of administrative operations in theUK and severances and related costs for personnel in our UK, German, French,Nordic and Italian operations, for European Lab; and $1.0 million, primarilyseverance, for Science Education. The majority of actions required have beencompleted as of December 31, 2005.

***Operating Income***

Thefollowing table presents operating income and operating income as a percentageof net sales by reportable segment for the years ended December 31, 2005,2004 and 2003 (dollars in millions):

| ** **         | ** ** | **Years Ended December 31,** | ** ** | **Percent of Net Sales** | ** ** |
|--------------------|------------|---------------------------------------------|------------|-----------------------------------------|------------|
| ** **         | ** ** | **2005**                                    | ** ** | **2004**                                | ** ** | **2003** | ** ** | **2005** | ** ** | **2004** | ** ** | **2003** | ** ** |
| Operating Income   |       |                                        |       |                                    |       |   |   |   |   |   |   |   |   |   |   |
| North American Lab |       | $                                           | 91.0       |                                    | $          | 93.6 |   | $ | 82.8 |   |   | 4.8 | % |   | 5.1 | % | 4.8 | % |
| European Lab       |       | 38.1                                        |       | 37.2                                    |       | 35.9 |   |   | 3.5 | % |   | 3.6 | % | 3.8 | % |
| Science Education  |       | 14.0                                        |       | 14.6                                    |       | 14.0 |   |   | 9.6 | % |   | 11.0 | % | 11.0 | % |
| Total              |       | $                                           | 143.1      |                                    | $          | 145.4 |   | $ | 132.7 |   |   | 4.6 | % |   | 4.8 | % | 4.7 | % |

 

Operating income for 2005 decreased $2.3 million or1.6% from 2004. Our current year acquisitions and the effects of foreigncurrency favorably impacted operating income in 2005 by $2.6 million and $1.3million, respectively. The restructuring programs discussed above decreasedoperating income by $20.6 million in 2005. Excluding these effects, operatingincome increased $14.4 million or 9.9% over 2004. This increase was the resultof improvement in gross profit of $22.4 million, primarily attributable tosales volume, partially offset by an SG&A increase of $8.0 million.Operating income for 2004 increased $12.7 million or 9.6%. Excluding theeffects of strengthening foreign currencies, operating income would haveincreased by 5.8% in 2004. Operating income expressed as a percentage of netsales was 4.8% for 2004 compared to 4.7% for 2003. The year-over-yearimprovement was primarily due to sales and gross profit growth rates exceedingthe SG&A expense growth rate in the North American Lab segment.

Operating income in the North American Lab segment for2005 decreased $2.6 million or 2.8% from 2004. Our current year acquisition ofAI and the effects of foreign currency favorably impacted operating income in2005 by $1.1 million and $1.4 million, respectively. The restructuring programsdiscussed above decreased operating income by $5.8 million in 2005. Excludingthese effects, operating income increased $0.7 million or 0.7% over 2004. Thisincrease was a result of a gross profit increase of $19.3 million offset by anSG&A increase of $18.6 million. The increase in SG&A reflects themajority of the investments in personnel and costs incurred related to ourcompliance with the Sarbanes-Oxley Act, partially offset by the lowerprovisions for bonus, discussed in SG&A above. Operating income in theNorth American Lab segment for 2004 increased $10.8 million or 13.0% from 2003.The year-over-year improvement was primarily due to higher supplier rebates andsales and gross profit growth rates exceeding the SG&A expense growth rateas the result of productivity initiatives taken to reduce costs during the thirdquarter of 2003. Strengthening foreign currencies positively affected operatingincome by $1.8 million for 2004 compared to 2003.

29

----

Operating income in the European Lab segment for 2005increased $0.9 million or 2.4% over 2004. Our current year acquisitions of AGBand TSL favorably impacted operating income by $1.5 million in 2005. Therestructuring programs discussed above and the effects of foreign currencydecreased operating income by $13.8 million and $0.1 million, respectively.Excluding these effects, operating income increased $13.3 million or 35.8% over2004. This increase was a result of a gross profit increase of $0.2 million andan SG&A decrease of $13.1 million reflecting savings from both 2004 and2005 restructuring initiatives. Included in this increase is an improvement inoperating results in France of $5.1 million from 2004. Operating income in theEuropean Lab segment for 2004 increased $1.3 million or 3.6%. Strengtheningcurrencies positively affected operating income by $3.2millionfor 2004comparedto2003. Excluding this effect, operating income decreased $1.9 million or 5.3%from 2003. In 2004 the European Lab segment was adversely affected by changesin pricing for certain chemicals purchased from Merck KGaA that we could notrecover through pricing increases and by losses of approximately $6.4 millionin our French operations in 2004 which exceeded the losses of approximately$3.2 million in 2003.

Operating income in theScience Education segment for 2005 decreased $0.6 million, or 4.1% from 2004.Excluding restructuring charges of $1.0 million in 2005, operating income forScience Education increased $0.4 million or 2.7% over 2004. This increase is aresult of  a gross profit increase of$2.9 million attributable to sales volume, partially offset by an unfavorablemix of business and more aggressive buying patterns of customers, and an  increase in SG&A of $2.5 million.Operating income in the Science Education segment for 2004 increased $0.6 millionor 4.3%. The 2004 increase in operating income was mainly due to an increase innet sales.

***Interest Expense, net of Interest Income***

Interest expense, net ofinterest income was $104.0 million, $57.5 million and $24.4 million for 2005,2004 and 2003, respectively. The 2005 increase was due to the new capitalstructure from the Acquisition being in place for the entire year, interestexpense on the Senior Discount Notes and higher variable interest rates on theSenior Secured Credit Facility during 2005 than 2004. The 2004 increase was dueto the new capital structure that was established in connection with theAcquisition that resulted in a higher level of outstanding debt as well as anincrease in interest rates.

***Other (Income)/Expense, net***

Other (income)/expense,net was ($3.8) million, ($2.0) million and ($3.0) million for 2005, 2004 and2003, respectively. Income in 2005 included net exchange gains of ($2.8)million, equity income of ($0.5) million and net gains on sale of assets of($0.5) million. Income in 2004 included net exchange gains of ($1.5) millionand equity income of ($0.5) million. Income in 2003 included net gains on saleof assets of ($1.4) million, ($1.0) million related to an insurance recoveryand equity income of ($0.6) million.

***Income Tax Provision***

The effective income taxrate was 48.7%, 42.4% and 41.5% for 2005, 2004 and 2003, respectively. Theeffective tax rates for 2005 and 2004 were higher than 2003 primarily as aresult of the valuation allowance required for losses incurred in France andforeign tax credits in the U.S. Additionaly, the 2005 effective tax rate ishigher because there is no state tax benefit associated with the interestexpense related to the Senior Discount Notes.

30

----

**Historical Cash Flows**

***Cash Flows from Operating Activities***

Thefollowing table presents cash flow from operations related to operations andworking capital (dollars in millions):

| ** **                                            | ** ** | **Years Ended December 31,** | ** ** |
|-------------------------------------------------------|------------|---------------------------------------------|------------|
| ** **                                            | ** ** | **2005**                                    | ** ** | **2004** | ** ** | **2003** | ** ** |
| Cash flow from  operations, excluding working capital |       | $                                           | 107.7      |   | $ | 100.9 |   | $ | 123.7 |   |
| Cash flow from  working capital changes, net          |       | (37.6                                       | )          | 84.5 |   | 31.4 |   |
| Cash flow from  operations                            |       | $                                           | 70.1       |   | $ | 185.4 |   | $ | 155.1 |   |

 

We generated $70.1 million of cash flow fromoperations during 2005 compared to $185.4 million during 2004. The decrease incash from operations is a result of increased levels of working capital in 2005as compared to 2004. In 2005, cash flow from working capital changes used cashprimarily for cash payments for restructuring charges of $34.9 million andincreases in inventories of $29.0 million. These cash usages were partiallyoffset by an increase in our accounts payable of $32.4 million.

We generated $185.4 million of cash flow fromoperations during 2004 compared to $155.1 million during 2003. The improvementin cash from operations was primarily the result of improvements in workingcapital management partially offset by a decline in net income resulting fromhigher interest expense. The significant improvement in cash flow from workingcapital changes was the result of increased focus by the Company’s management inthe areas of accounts payable and inventory that was partially offset by anincrease in trade accounts receivable.

Days sales outstanding in accounts receivable were48.2, 49.0 and 48.9 days as of December 31, 2005, 2004 and 2003,respectively. Days sales outstanding are higher in Europe due to the extendedpayment practices in the countries in which we operate.

Days supply in inventory were 43.1, 39.1 and 46.6 daysas of December 31, 2005, 2004 and 2003, respectively. The 2005 increase isa result of changes in our supplier network and the stocking of products fromnew suppliers. The 2004 decrease was due primarily to efforts to reduceinventory levels while maintaining customer service levels.

Trade accounts payable areprimarily with suppliers whose products we distribute. Payment terms arenegotiated and in cases where economic early payment discounts are offered, wemay make early payments to earn the discounts. Days payable outstanding aregenerally higher in Europe due to the extended payment practices in thecountries in which we operate. Depending on the timing of payments andinventory purchases, trade accounts payable can vary each quarter and from yearto year. Days payable outstanding were 59.1, 52.5 and 41.1 days as of December 31,2005, 2004 and 2003, respectively. These increases are mainly due to efforts toreduce working capital by increasing our days payable outstanding.

***Cash Flows from Investing Activities***

Net cash used in investing activities was $62.2million, $1,577.1 million and $8.9 million for the years ended December 31,2005, 2004 and 2003, respectively. The 2005 usage primarily related toinvestments to acquire businesses of $46.0 million and capital expenditures of$18.4 million. The 2004 usage primarily related to the Acquisition and capitalexpenditures of $16.4 million. The 2003 usage related to capital expendituresof $16.6 million, offset by proceeds from sales of property and equipment of$7.7 million.

Our capital expendituresconsist of two principal components: expenditures for facilities andexpenditures for technology to support the business. The timing of warehouseexpansions may cause a variance in year-to-year capital expenditures. Weanticipate 2006 capital expenditures to approximate 

31

----

$40.0million. The significant components of these expenditures will includeexpansion in Puerto Rico and other improvements in operating capacity;upgrading our manufacturing facilities in Belgium and France; and investmentsin information technology to support certain business initiatives.

***Cash Flows fromFinancing Activities***

Net cash provided by (usedin) financing activities was $3.4 million, $1,607.6 million and ($144.8) million for the years ended December 31,2005, 2004 and 2003, respectively. The 2005 cash provided is comprised of a netincrease in our bank checks outstanding of $15.0 million, net debt payments of($10.7) million, cash paid for debt issuance costs of ($0.8) million and netstock activities of ($0.1) million. The net cash provided in 2004 was primarilya result of the Acquisition, the new capital structure we established, a netincrease in our bank checks outstanding and proceeds from the CDRV Investors, Inc.Stock Incentive Plan. The 2003 usage primarily related to net debt repayments.

***Liquidity andCapital Resources***

We broadly defineliquidity as our ability to generate sufficient funds from both internal andexternal sources to meet our obligations and commitments. In addition,liquidity includes the ability to obtain appropriate debt and equity financing.Therefore, liquidity cannot be considered separately from capital resourcesthat consist of current or potentially available funds for use in achievinglong-range objectives and meeting debt service commitments.

As of December 31,2005, we had outstanding indebtedness of $1,393.4 million, which consistsprimarily of $520.0 million aggregate principal amount of VWR Notes, $330.2million of accreted value of Senior Discount Notes, a $379.9 million U.S.dollar-denominated term loan and a $157.2 million Euro-denominated term loan.Cash paid for interest during 2005 was $70.4 million as compared to $35.2million in 2004. Our debt levels, interest rates and our cash paid for interestexpense increased significantly as a result of the Acquisition and the issuanceof the Senior Discount Notes. Based on borrowings outstanding and interestrates in effect as of December 31, 2005, interest expense for the yearending December 31, 2006 is expected to be reasonably consistent with the2005 amount. Prior to the Acquisition, interest on our push down debt did notrepresent cash interest, as we were not required to pay Merck KGaA interest.The interest expense associated with the push down debt was recorded as acapital contribution by Merck KGaA, net of tax.

As of December 31,2005, we had $11.6 million of undrawn letters of credit and our remainingborrowing availability under the $150.0 million multi-currency revolving creditfacility forming part of the Senior Secured Credit Facility was $138.4 million.Undrawn amounts under the multi-currency revolving credit facility will beavailable to meet futureworking capital and our otherbusiness needs. As borrowings under the multi-currency revolving creditfacility may fluctuate with our working capital and other business needs, andthe borrowings thereunder bear interest at variable rates, interest expense forthis facility will fluctuate as well.

Under the credit agreementfor the Senior Secured Credit Facility, beginning in 2006, VWR’s Excess CashFlow (as defined in the credit agreement) from the prior year will berequiredto be used toprepay credit agreement debt. On March 31, 2006,$44.4 million will be repaid as required by the Excess Cash Flow provisions ofthe Senior Secured Credit Facility. Based upon current levels of operations andexpectations as to future growth, we believe that cash on hand, generated fromoperations, together with amounts available under our $150.0 millionmulti-currency revolving credit facility which is a component of the SeniorSecured Credit Facility, will be adequate to permit us to meet our debt serviceobligations, capital expenditure requirements, ongoing operating costs andworking capital needs until the maturity of the Senior Secured Credit Facility,although no assurance can be given in this regard. Our future financial andoperating performance, ability to service or refinance our debt and ability tocomply with covenants and restrictions contained in our debt agreements will besubject to future economic conditions and to 

32

----

financial,business and other factors, many of which are beyond our control and will besubstantially dependent on the global economy, demand for our products, and ourability to successfully implement our overall business and profitabilitystrategies. As of December 31, 2005, we had $126.1 million of cash andcash equivalents on hand.

**Scheduleof Contractual Obligations**

The following tablesdetail the payment schedule for debt, capital leases and operating leases asofDecember 31, 2005 (dollars in millions):

| ** **                                                 | ** ** | **<1 year** | ** ** | **1-3 years** | ** ** | **4-5 years** | ** ** | **>5 years** | ** ** | **Total** | ** ** |
|------------------------------------------------------------|------------|---------------------|------------|--------------------|------------|--------------------|------------|----------------------|------------|-----------|------------|
| Senior Secured Credit Facility                             |       |                | $          | 44.4               | (1)        |               |       | $                    | 10.0       |      |       | $ | 246.8 |   |   | $ | 235.9 |   |   | $ | 537.1 |   |
| 67¤8% Unsecured Senior Notes due 2012                 |       |                | —     |               |       |               | —     |                 |       | —    |       |   | 200.0 |   |   | 200.0 |   |
| 8% Unsecured Senior Subordinated Notes due 2014            |       |                | —     |               |       |               | —     |                 |       | —    |       |   | 320.0 |   |   | 320.0 |   |
| 95¤8% Senior Discount Notes due 2015 (accreted value) |       |                | —     |               |       |               | —     |                 |       | —    |       |   | 481.0 |   |   | 481.0 |   |
| Bank loans                                                 |       |                | 0.3        |               |       |               | —     |                 |       | —    |       |   | — |   |   | 0.3 |   |
| Capital leases                                             |       |                | 0.8        |               |       |               | 1.4        |                 |       | 1.3       |       |   | 2.3 |   |   | 5.8 |   |
| Operating leases                                           |       |                | 23.8       |               |       |               | 36.2       |                 |       | 23.5      |       |   | 30.7 |   |   | 114.2 |   |
| Total                                                      |       |                | $          | 69.3               |       |               |       | $                    | 47.6       |      |       | $ | 271.6 |   |   | $ | 1,269.9 |   |   | $ | 1,658.4 |   |

----

(1)             Reflects the amount due in March 2006based on VWR’s Excess Cash Flow generated in 2005.

Prior to the Acquisition,substantially all of VWR’s debt was with Merck KGaA and affiliates at an averageinterest rate of 2.0% to 2.8%. The push down debt reflects the debt incurred byMerck KGaA as a result of its acquisition of VWR International Corporation. Aportion of the cash consideration for the Acquisition was used to repay alldebt owing to Merck KGaA and affiliates outstanding on April 7, 2004.

**IndebtednessFollowing the Acquisition**

***Senior Secured Credit Facility.***   OnApril 7, 2004, VWR, with a syndicate of lenders, led by Deutsche Bank AG,New York Branch, as administrative agent, Citicorp North America Inc., assyndication agent, and Bank of America, N.A., BNP Paribas and Barclays BankPLC, as documentation agents, entered into the Senior Secured Credit Facility.VWR is the borrower under the Senior Secured Credit Facility. The Senior SecuredCredit Facility consists of (1) a term loan facility providing for a loandenominated in Euros, in an aggregate principal amount currently outstanding at€132.7million (approximately $157.2 million on a U.S. dollar equivalent basis as of December 31,2005), (2) a term loan facility providing for a term loan denominated inU.S. dollars in an aggregate principal amount currently outstanding at $379.9million, and (3) a multi-currency revolving credit facility, providing forup to $150.0 million in multi-currency revolving loans (including standby andcommercial letters of credit) outstanding at any time. The term loan principalamounts currently outstanding are net of a $50.0 million prepayment on July 30,2004. As of December 31, 2005, nothing was drawn under the multi-currencyrevolving credit facility and we had $11.6 million in undrawn letters ofcredit. Undrawn amounts under the multi-currency revolving credit facility areavailable on a revolving credit basis for general corporate purposes of theborrower and its subsidiaries.

***VWR Notes.******  ***On April 7,2004, VWR issued 67¤8%senior notes and 8% senior subordinated notes that mature on April 15,2012 and April 15, 2014, respectively, in the aggregate principal amountsof $200.0 million and $320.0 million, respectively, to finance a portion of theAcquisition.

The indentures governingthe VWR Notes contain certain covenants that limit VWR’s ability to incur additionalindebtedness, pay cash dividends and make certain other payments. Theindentures also require VWR to maintain certain financial covenants, includinga specified debt to Consolidated EBITDA leverage ratio and a specifiedConsolidated EBITDA to interest expense coverage ratio, as those terms aredefined and relate to VWR. At December 31, 2005, VWR was in compliancewith all covenants.

33

----

***Senior DiscountNotes.******  ***On December 16, 2004, we issued$481.0 million aggregate principal amount at maturity ($299.4 million grossproceeds) of Senior Discount Notes. The proceeds, net of $1.5 million of debtissuance costs, were used to pay a cash dividend to holders of our common stockin December 2004. The notes are senior unsecured obligations of theCompany and are structurally subordinated to all obligations and otherliabilities of the Company’s existing and future subsidiaries.

Nocash interest will accrue on the Senior Discount Notes prior to January 1,2010. Thereafter, cash interest will accrue on the notes and be payablesemiannually in arrears on January 1, and July 1 of each year,commencing on July 1, 2010, at the rate of 95¤8% per annum, providedthat on any interest payment date, interest will be payable only to the extentfunds are available for distribution by our subsidiaries to us (net ofapplicable taxes and expenses) under specified provisions of the indenturesgoverning the VWR Notes and applicable law. As of December 31, 2005, theaccreted value of the Senior Discount Notes was $330.2 million. VWR does notguarantee the obligations under the Senior Discount Notes.

The indenture for the Senior Discount Notes containscovenants that, among other things, limit the amount of additional indebtednesswe may incur, pay cash dividends, sell assets and subsidiary stock, enter intotransactions with affiliates, place liens on assets, and make certain otherpayments. At December 31, 2005, the Company was in compliance with allcovenants. The terms of the Senior Secured Credit Facility and the indenturesgoverning the VWR Notes significantly restrict VWR from making distributionsand otherwise transferring assets to us.

***European Subsidiaries.***   OurEuropean subsidiaries operate with and without formal agreements with foreignbanks. There are no existing financial covenants related to the bank loans tothese subsidiaries.

**CreditAgreement Financial Covenants; Credit Agreement EBITDA**

Borrowings under the Senior Secured Credit Facilityare a key source of our liquidity. Our ability to borrow under the SeniorSecured Credit Facility is dependent upon, among other things, VWR’s compliancewith the financial covenants set forth in the credit agreement for the SeniorSecured Credit Facility. The financial covenants include a specified debt toCredit Agreement EBITDA leverage ratio and a specified Credit Agreement EBITDAto interest expense coverage ratio for specified periods, as those terms aredefined and relate to VWR. Failure of VWR to comply with these financial ratiocovenants would result in a default under the credit agreement for the SeniorSecured Credit Facility and, absent a waiver or an amendment from our lenders,would permit the acceleration of all outstanding borrowings under the SeniorSecured Credit Facility. VWR was in compliance with these financial covenantsas of December 31, 2005.

Credit Agreement EBITDA as presented herein is a VWRfinancial measure that is used in the credit agreement for the Senior SecuredCredit Facility. Credit Agreement EBITDA is not a defined term under U.S. GAAPand should not be considered as an alternative to operating income or netincome as a measure of operating results or cash flows as a measure of liquidity.Credit Agreement EBITDA differs from the term “EBITDA” as it is commonly used.Credit Agreement EBITDA generally is defined as consolidated net income beforeconsolidated net interest expense, consolidated income taxes, consolidateddepreciation and amortization, other non-cash charges deducted in determiningconsolidated net income (loss), non-cash provisions for reserves fordiscontinued operations, extraordinary, unusual or non-recurring items, gain orloss associated with the sale or write down of assets not in the ordinarycourse of business and the cumulative effect of accounting changes and earningsof, but including cash dividends or distributions from, non-controlledaffiliates. Credit Agreement EBITDA is reduced by the amount of certain permitteddividends from VWR to CDRV Holdings, Inc.

Credit Agreement EBITDA is not used in the indenturesfor the notes. The term “Consolidated EBITDA” is used in the indentures as partof the calculation of the term “Consolidated Coverage Ratio”, which is used fora number of purposes, including determining our ability to incur additionalindebtedness, 

34

----

and may include certaincost savings or synergies. “Consolidated EBITDA” is not the same as CreditAgreement EBITDA.

Thefollowing table presents a calculation of VWR’s Credit Agreement EBITDA for theyear ended December 31, 2005 (dollars in millions):

| Income before  cumulative effect of a change in accounting principle |   | $    | 41.8   |   |
|----------------------------------------------------------------------|--------|------|--------|--------|
| Income tax  provision                                                |   | 31.0 |   |
| Interest expense,  net                                               |   | 74.3 |   |
| Depreciation and  amortization                                       |   | 33.9 |   |
| Non-cash charges  (1)                                                |   | 13.7 |   |
| Other  extraordinary, unusual or non-recurring items (2)             |   | 20.2 |   |
| Adjustment for  pro-forma effect of material acquisitions (3)        |   | 0.8  |   |
| Credit Agreement EBITDA                                              |   | $    | 215.7  |   |

----

(1)          Non-cash charges includepension, postretirement and post employment benefit expenses, net of cashcontributed to the respective benefit plans in that year; amortization ofdirect response catalog costs for those catalogs with useful lives greater thanone year; and LIFO adjustments.

(2)          Other extraordinary,unusual or non-recurring items include one-time severance costs; non-routineinventory reserve adjustments; gains or losses on the sale of businesses orfacilities; and other extraordinary, unusual or non-recurring gains, losses,charges or credits.

(3)          Adjustment for pro-formaeffect of material acquisitions, as defined, is reflected in the calculation ofCredit Agreement EBITDA on a pro-forma basis as if the acquisitions of AGB andAI occurred on January 1, 2005.

Thefinancial covenants specify, among other things, the following requirements foreach four-quarter period ended during the following test periods:

| **Test Period**                                | ** ** | ** ** | ** **   | **Consolidated Debt to  Credit Agreement EBITDA  Leverage Ratio Not More Than** | ** ** | **Credit Agreement EBITDA  to Interest Expense Ratio  Not Less Than** | ** **   |
|-----------------------------------------------------|------------|------------|--------------|-------------------------------------------------------------------------------------------------------------------------|------------|----------------------------------------------------------------------------------------------------------|--------------|
| July 1,  2004—December 30, 2005      |       |       | 7.25 to 1.00 |                                                                                                                    |       |                                                                                                     | 1.80 to 1.00 |   |   |
| December 31,  2005—December 30, 2006 |       |       | 7.00 to 1.00 |                                                                                                                    |       |                                                                                                     | 1.90 to 1.00 |   |   |
| December 31,  2006—December 30, 2007 |       |       | 6.50 to 1.00 |                                                                                                                    |       |                                                                                                     | 2.00 to 1.00 |   |   |
| December 31,  2007—December 30, 2008 |       |       | 6.00 to 1.00 |                                                                                                                    |       |                                                                                                     | 2.10 to 1.00 |   |   |
| December 31,  2008—December 30, 2009 |       |       | 5.50 to 1.00 |                                                                                                                    |       |                                                                                                     | 2.20 to 1.00 |   |   |
| December 31,  2009—December 30, 2010 |       |       | 5.00 to 1.00 |                                                                                                                    |       |                                                                                                     | 2.30 to 1.00 |   |   |
| December 31, 2010  and thereafter              |       |       | 5.00 to 1.00 |                                                                                                                    |       |                                                                                                     | 2.40 to 1.00 |   |   |

 

Thetable below sets forth VWR’s specified debt to Credit Agreement EBITDA leverageratio and Credit Agreement EBITDA to interest expense ratio for the year ended December 31,2005:

| Consolidated  Debt to Credit Agreement EBITDA Leverage Ratio           | 4.9 |
|------------------------------------------------------------------------|-----|
| Credit Agreement  EBITDA to Credit Agreement Interest Expense Ratio(1) | 3.1 |

----

(1)          Forpurposes of calculating the compliance ratio noted above, credit agreementinterest expense was based on actual interest expense, net of interest income,reduced by amortization of deferred financing fees.

35

----

**Critical Accounting Policies**

The policies discussed below are considered bymanagement to be critical to an understanding of our financial statementsbecause their application places the most significant demands on management’sjudgment, with financial reporting results relying on estimation about theeffect of matters that are inherently uncertain. Specific risks for thesecritical accounting policies are described in the following paragraphs. For allof these policies, management cautions that future events rarely developexactly as forecast, and the best estimates routinely require adjustment.

***Accounts Receivableand Reserves.***   The carrying amount ofaccounts receivable reflects a reserve representing our best estimate of theamounts that will not be collected for losses due to uncollectibility and forestimated sales returns and allowances. In addition to reviewing delinquentaccounts receivable, we consider many factors in estimating our reserve,including historical data, experience, customer types, credit worthiness, andeconomic trends. From time to time, we may adjust our assumptions foranticipated changes in any of these or other factors expected to affectcollectibility.

***Inventories.***   Inventoriesare valued at the lower of cost or market, cost being determined principally bythe last-in, first-out (“LIFO”) method for the U.S. subsidiaries and theaverage cost or the first-in, first-out (“FIFO”) method for all othersubsidiaries. During the year, estimates of the impact of LIFO are used basedupon full year estimates of the impact of LIFO and such estimates may changeduring the course of the year based upon various factors such as priceincreases and inventory turnover. We review our inventory realization basedupon several factors, including customer demand, supply of inventory andcompetitive activity and record reserves for obsolescence based upon those andother factors. From time to time, we may adjust our assumptions for anticipatedchanges in any of these or other factors.

***Rebates fromSuppliers.***   We earn rebates from certain ofour suppliers from the achievement of certain sales growth and/or purchasevolume thresholds. To the extent that rebates relate to inventory on hand, theinventory cost is reduced to reflect the lower cost. During the course of theyear, estimates made concerning the achievement of these goals or milestonescan vary from quarter to quarter. Generally, a proportionally larger amount ofrebates are earned in the fourth quarter of each year.

***Agreements withCustomers.***   We have agreements with severalof our customers, which contain provisions related to pricing, volume purchaseincentives and other items. During the course of the year, estimates are madeconcerning customer contracts and changes in estimates related to thesecontracts may vary from quarter to quarter and are recorded as a reduction tosales.

***Goodwill andIntangible Assets.***   In accordance with SFAS No. 142,*Goodwill and Other Intangible Assets*,goodwill is no longer amortized, but rather, is evaluated for impairment on anannual basis. To accomplish this, we were required to identify our reportingunits and determine the carrying value of each reporting unit by assigning theassets and liabilities, including the existing goodwill and intangible assets,to those reporting units. We are required to determine the fair value of eachreporting unit and compare it to the carrying amount of the reporting unitduring the fourth quarter of each year. Fair value of the reporting unit isdetermined using a combination of discounted cash flows and multiple ofearnings valuation techniques. To the extent the carrying amount of a reportingunit exceeded the fair value of the reporting unit, we would be required toperform the second step of the transitional impairment test, as this is anindication that the reporting unit goodwill may be impaired.

As a result of the Acquisition, we have recognizedsignificant intangible assets. In accordance with the provisions of SFAS No. 142,we reevaluate the estimated useful lives of our intangible assets annually.Those intangible assets considered to have indefinite useful lives areevaluated for impairment on an annual basis, by comparing the fair value of theintangible asset to its carrying value. In addition, whenever events or changesin circumstances indicate that the carrying value of intangible assets might beless than the fair value, we will perform an impairment review. Fair value ofintangible assets is determined using a 

36

----

discounted cash flowapproach. Intangible assets with estimable useful lives are amortized overtheir respective estimated useful lives to their estimated residual values, andreviewed for impairment in accordance with SFAS No. 144, *Accounting for Impairment or Disposal of Long-LivedAssets*.

Our estimates are based upon historical trends,management’s knowledge and experience and overall economic factors includingprojections of future earnings potential. While we believe our estimates arereasonable, different assumptions regarding items such as future earningspotential and volatility in the markets we serve could affect our evaluationsand result in write-downs to the carrying amount of our goodwill and ourintangible assets.

***Product Liability.***   Weare subject to product liability and other claims in the ordinary course ofbusiness. Our business involves a risk of product liability and other claims inthe ordinary course of business, and from time to time we are named as adefendant in cases as a result of our distribution of scientific supplies.While the impact on us of this litigation has typically been immaterial, therecan be no assurance that the impact of the pending and any future claims willnot be material to our business, financial condition or results of operationsin the future. For further information, see “Item 3—Legal Proceedings.”

***EnvironmentalLiabilities.***   We record accruals forenvironmental liabilities based on current interpretations of environmentallaws and regulations when it is probable that a liability has been incurred andthe amount can be reasonably estimated. Our estimates are based upon severalfactors, including reports prepared by environmental specialists and management’sknowledge and experience with these environmental matters. Inherentuncertainties exist in these estimates due to unknown conditions, changing lawsand regulations and changes in the manner or method of enforcement of such lawsand regulations. Accrued liabilities and payments related to environmentalliabilities have not been material. Although management uses its best estimateswhen establishing accruals for environmental liabilities, if interpretations ofapplicable laws and regulations, cleanup methods or the extent of ourresponsibility change from our current estimates, revisions to our estimatedenvironmental liability may be required.

***Pension Plans.***   Wehave defined benefit pension plans covering a significant number of domesticand international employees. Accounting for these plans requires the use ofassumptions, including estimates on the expected long-term rate of return onassets, discount rates and the average rate of increase in employeecompensation. In order to make informed assumptions, management consults withactuaries and reviews public market data and general economic information. Weperiodically assess these assumptions based on market conditions, and if thoseconditions change, our pension cost and pension obligation may be adjustedaccordingly.

***Estimates and Other Accounting Policies.***   Thepreparation of financial statements in conformity with U.S. GAAP requiresmanagement to make estimates and assumptions that affect the reported amountsof assets and liabilities and disclosure of contingent assets and liabilitiesat the date of the financial statements and the reported amounts of revenuesand expenses during the reporting period. Management evaluates its estimatesand judgments, including those related to product returns, intangible assets,income taxes, restructuring costs, insurance costs, and contingencies andlitigation. While actual results could differ from those estimates, managementbelieves that the estimates are reasonable.

**New Accounting Standards**

During December 2004, the Financial AccountingStandards Board (“FASB”) issued SFAS No. 123 Revised, *Share-Based Payment* (“SFAS No. 123R”).This Statement requires companies to recognize in the income statement, thegrant date value of stock options and other forms of equity-based compensationissued to employees. The provisions of this Statement become effective at thebeginning of 2006. During August 2004, we introduced a share-basedcompensation arrangement as a component of our compensation plans for ouremployees. Effective January 1, 2006 we are no longer permitted to followthe 

37

----

intrinsic value accountingmethod of APB No. 25, and SFAS No. 123R will apply to all of ouroutstanding unvested options as of January 1, 2006 and all prospectiveawards using the modified prospective transition method without restatement ofprior periods. The impact this Statement will have on the Company’s results ofoperations will be substantially consistent with the pro-forma amounts shown inNote 2(o) in our consolidated financial statements.

During November 2004,the FASB issued SFAS No. 151, *InventoryCosts*. This Statement clarifies the accounting for abnormal amountsof idle facility expenses, freight handling costs, and spoilage. This Statementrequires such excess costs be charged as current-period expenses. ThisStatement also specifies that allocated overhead costs to inventory must bebased on normal capacity measures. This Statement becomes effective forinventory costs incurred beginning January 1, 2006. The adoption of thisstandard is not expected to materially impact the Company.

**Forward-Looking Statements**

This Annual Reporton Form 10-K includes forward-looking statements regarding, amongother things, our plans, strategies and prospects, both business and financial.These statements are based on the beliefs and assumptions of our management.Although we believe that our plans, intentions and expectations reflected in orsuggested by these forward-looking statements are reasonable, we cannot assureyou that we will achieve or realize these plans, intentions or expectations.Forward-looking statements are inherently subject to risks, uncertainties andassumptions. Generally, statements that are not historical facts, includingstatements concerning our possible or assumed future actions, businessstrategies, events or results of operations, are forward-looking statements.These statements may be preceded by, followed by or include the words “believes,”“expects,” “anticipates,” “intends,” “plans,” “estimates” or similarexpressions. Forward-looking statements include the information in this AnnualReport on Form 10-K regarding, among other things:

·       managementforecasts;

·       efficienciesand cost savings;

·       incomeand margins;

·       growth;

·       economiesof scale;

·       theeconomy;

·       futureeconomic performance;

·       futureacquisitions and dispositions;

·       litigation;

·       potentialand contingent liabilities;

·       management’splans;

·       taxes;and

·       refinancingof debt.

Forward-looking statements are not guarantees ofperformance. You should not place undue reliance on these statements. Youshould understand that the following important factors, in addition to thosediscussed in “Item 1A - Risk Factors” and elsewhere in this Form 10-K,could affect our future results and 

38

----

could cause those resultsor other outcomes to differ materially from those expressed or implied in ourforward-looking statements:

·       actionsby manufacturers, customers, carriers and other third parties;

·       ourability to maintain our relationships with manufacturers;

·       lossof our key executive officers;

·       ourability to consummate and integrate potential acquisitions;

·       theeffect of political and economic conditions, inflation and interest ratesworldwide;

·       theeffect of changes in laws and regulations, including changes in accountingstandards, trade, tax, price controls and other regulatory matters; and

·       increasedcompetition from other companies in our industry and our ability to retain orincrease our market shares in our principal geographical markets.

All forward-lookingstatements attributable to us or persons acting on our behalf are expresslyqualified in their entirety by the foregoing cautionary statements. You arecautioned not to place undue reliance on the forward-looking statements, whichspeak only as of the date of this Annual Report on Form 10-K. Weundertake no obligations to update or revise publicly any forward-lookingstatements, whether as a result of new information, future events or otherwise.

**Market and Industry Data**

Information in this Form 10-Kabout the global research laboratory industry, including our general expectationsconcerning the industry, are based on estimates prepared using data fromvarious sources and on assumptions made by us. We believe data regarding theglobal research laboratory industry are inherently imprecise, but based onmanagement’s understanding of the markets in which we compete, managementbelieves that such data is generally indicative of the industry. Our estimates,in particular as they relate to our general expectations concerning the globalresearch laboratory industry, involve risks and uncertainties and are subjectto change based on various factors, including those discussed under theheadings “Risk Factors Related to Our Capital Structure” and “Risk FactorsRelated to Our Business”  in “Item 1A -Risk Factors.”

**ITEM 7A.  **QUANTITATIVEAND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

***Interest Rates.***   Weare exposed to changes in interest rates, primarily as a result of our existingshort-term and long-term debt with both fixed and floating interest rates.Prior to the Acquisition, we did not enter into agreements related to interestrate risk. A 100 basis point (or 1.00%) change in variable rate debtoutstanding as of December 31, 2005 would, on an annualized basis, affectnet income by approximately $3.2 million.

In the future, we may use interest rate swaps or otherderivatives to manage interest rate risk on future income caused by interestrate changes on the variable rate facilities under the Senior Secured CreditFacility. If swaps are used, the differential to be paid or received under the agreementsis recognized as an adjustment to interest expense related to the debt. TheSenior Secured Credit Facility requires us to enter into interest rateprotection agreements which, together with fixed interest rates then applicableto our consolidated funded indebtedness, will provide interest rate protectionwith respect to at least 50% of our consolidated funded indebtedness for aperiod of time. Effective July 21, 2004, VWR entered into an interest ratecap to hedge a portion of the variability of cash flows related to potentialchanges in interest rates on €35.0 million of ourEuro-denominated term loan facility.

39

----

***Foreign CurrencyHedging.***   The value of certain foreigncurrencies as compared to the U.S. dollar may affect our financial results.Fluctuations in exchange rates may positively or negatively affect our netsales, gross margins, operating expenses, cash flows and retained earnings, allof which are expressed in U.S. dollars. However, net sales and costs tend to beincurred in the same currency, and therefore, mitigate local currency risks.

Where we deem itprudent, we have engaged in hedging programs, using primarily foreign currencyforward contracts, aimed at limiting the impact of foreign currency exchangerate fluctuations on cash flows and earnings. Cash flows from currency forwardcontracts accounted for as hedges are classified in the statement of cash flowsin the same category as the item being hedged or on a basis consistent with thenature of the instrument. These activities have not been material to ourfinancial statements. We may purchase short-term foreign currency forwardcontracts to protect against currency exchange risks associated with long-termintercompany loans due from our international subsidiaries and the payment of merchandisepurchases to foreign vendors. The majority of our debt, including the notes, isdenominated in U.S. dollars, and accordingly, the majority of our future debtservice needs will be U.S. dollar denominated. We have a Euro-denominated termloan in an aggregate principal amount equal to €132.7 million(approximately $157.2 million as of December 31, 2005, on a U.S. dollarequivalent basis) and a $150.0 million multi-currency revolving credit facilityforming part of the Senior Secured Credit Facility, as well as borrowings undercertain local credit facilities, each of which partially mitigates our currencyrisk with respect to future debt service. Net sales and costs tend to beincurred in the same currency, and therefore mitigate local currency risk.

40

----

**ITEM 8.**               FINANCIALSTATEMENTS AND SUPPLEMENTARY DATA

The following financial statements and schedule ofCDRV Investors, Inc. (Successor) and VWR International Corporation(Predecessor) for the periods indicated are included in this 10-K.

Theterm “Successor” refers to CDRV Investors, Inc. following the Acquisition.The term “Predecessor” refers to VWR International Corporation prior to theAcquisition on April 7, 2004. 

| ** **                                                                                                                                                                                                                                       | ** ** | **Page** | ** ** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|----------|------------|
| **CDRV  Investors, Inc. (Successor) and VWR International Corporation  (Predecessor)**                                                                                                                                                      |       |     |       |   |   |
| Report of Independent Registered Public Accounting  Firm                                                                                                                                                                                         |       |     | 42         |   |   |
| Consolidated  Balance Sheets as of December 31, 2005 and 2004                                                                                                                                                                               |       |     | 43         |   |   |
| Consolidated Statements of Operations for the year  ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003                                                       |       |     | 44         |   |   |
| Consolidated Statements of Stockholders’ Equity and  Other Comprehensive Income (Loss) for the year ended December 31, 2005,  the periods included in the year ended December 31, 2004 and the year  ended December 31, 2003 |       |     | 45         |   |   |
| Consolidated Statements of Cash Flows for the year  ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003                                                       |       |     | 47         |   |   |
| Notes to Consolidated Financial Statements                                                                                                                                                                                                       |       |     | 48         |   |   |
| Schedule II—Valuation and Qualifying Accounts for the  year ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003.                                         |       |     | 112        |   |   |

 

41

----

**Report of Independent Registered Public AccountingFirm**

TheBoard of Directors and Stockholders

CDRV Investors, Inc.:

We have audited the accompanying consolidated balancesheets of CDRV Investors, Inc. and subsidiaries (Successor) as of December 31,2005 and 2004, and the related consolidated statements of operations,stockholders’ equity and other comprehensive income (loss), and cash flows forthe year ended December 31, 2005 and the period from April 7, 2004 toDecember 31, 2004 (Successor period) and from January 1, 2004 to April 6,2004 and for the year ended December 31, 2003 (Predecessor periods). Inconnection with our audits of the consolidated financial statements, we alsohave audited the financial statement schedule for the Successor and Predecessorperiods. These consolidated financial statements and financial statementschedule are the responsibility of the Company’s management. Our responsibilityis to express an opinion on these consolidated financial statements based onour audits.

We conducted our audits in accordance with thestandards of the Public Company Accounting Oversight Board (United States).Those standards require that we plan and perform the audit to obtain reasonableassurance about whether the financial statements are free of materialmisstatement. An audit includes examining, on a test basis, evidence supportingthe amounts and disclosures in the financial statements. An audit also includesassessing the accounting principles used and significant estimates made bymanagement, as well as evaluating the overall financial statement presentation.We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the aforementioned Successorconsolidated financial statements referred to above present fairly, in allmaterial respects, the financial position of CDRV Investors, Inc. andsubsidiaries as of December 31, 2005 and 2004, and the results of theiroperations and their cash flows for the Successor periods in conformity withU.S. generally accepted accounting principles. Further, in our opinion, theaforementioned Predecessor consolidated financial statements present fairly, inall material respects, the results of operations and cash flows of VWR International Corporation andsubsidiaries for the Predecessor periods, in conformity with U.S. generallyaccepted accounting principles. Also in our opinion, the related consolidatedfinancial statement schedule, when considered in relation to the basicconsolidated financial statements taken as a whole, presents fairly, in allmaterial respects, the information set forth therein.

As discussed in Note 1 to the consolidated financialstatements, effective April 7, 2004, CDRV Acquisition Corporation acquiredall of the outstanding stock of VWR International Corporation in a businesscombination accounted for as a purchase. As a result of the acquisition, theconsolidated financial information for the periods after the acquisition arepresented on a different cost basis than that for the periods before theacquisition and, therefore, are not comparable.

As discussed in Note 3 to the consolidatedfinancial statements, effective December 31, 2005, the Company adopted theprovisions of FASB Interpretation No. 47, *Accountingfor Conditional Asset Retirement Obligations*.

/s/ KPMG LLP

Philadelphia,Pennsylvania

March 30, 2006

42

----

**CDRV INVESTORS,INC.Consolidated Balance Sheets(Dollars in millions, except share data)**

| ** **                                                                                                                                                                                                              | ** ** | **December 31,** | ** ** |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                                                                                                                                                                              | ** ** | **2005**              | ** ** | **2004** | ** ** |
| **Assets**                                                                                                                                                                                                              |       |                  |       |   |   |
| Current Assets:                                                                                                                                                                                                         |       |                  |       |   |   |
| Cash and cash equivalents                                                                                                                                                                                               |       | $                     | 126.1      |   | $ | 116.9 |   |
| Trade accounts receivable, less reserves of $6.6 and  $6.0, respectively                                                                                                                                                |       | 407.3                 |       | 413.4 |   |
| Other receivables                                                                                                                                                                                                       |       | 31.0                  |       | 25.3 |   |
| Inventories                                                                                                                                                                                                             |       | 270.4                 |       | 248.9 |   |
| Other current assets                                                                                                                                                                                                    |       | 30.6                  |       | 27.1 |   |
| Total current assets                                                                                                                                                                                                    |       | 865.4                 |       | 831.6 |   |
| Property and  equipment, net                                                                                                                                                                                            |       | 156.8                 |       | 154.4 |   |
| Investments                                                                                                                                                                                                             |       | 7.8                   |       | 8.7 |   |
| Goodwill                                                                                                                                                                                                                |       | 910.0                 |       | 907.0 |   |
| Other intangible  assets, net                                                                                                                                                                                           |       | 552.7                 |       | 570.8 |   |
| Deferred income  taxes                                                                                                                                                                                                  |       | 8.7                   |       | 34.4 |   |
| Other assets                                                                                                                                                                                                            |       | 45.9                  |       | 46.5 |   |
| Total assets                                                                                                                                                                                                            |       | $                     | 2,547.3    |   | $ | 2,553.4 |   |
| **Liabilities  and Stockholders’ Equity**                                                                                                                                                                          |       |                  |       |   |   |
| Current Liabilities:                                                                                                                                                                                                    |       |                  |       |   |   |
| Short-term portion of bank debt  and current portion of capital lease obligations                                                                                                                                       |       | $                     | 45.5       |   | $ | 12.9 |   |
| Accounts payable                                                                                                                                                                                                        |       | 370.3                 |       | 333.8 |   |
| Accrued expenses                                                                                                                                                                                                        |       | 139.1                 |       | 151.7 |   |
| Total current liabilities                                                                                                                                                                                               |       | 554.9                 |       | 498.4 |   |
| Long-term debt                                                                                                                                                                                                          |       | 1,342.9               |       | 1,380.1 |   |
| Capital lease  obligations                                                                                                                                                                                              |       | 5.0                   |       | 6.1 |   |
| Other long-term  liabilities                                                                                                                                                                                            |       | 87.1                  |       | 86.2 |   |
| Deferred income  taxes                                                                                                                                                                                                  |       | 233.5                 |       | 241.1 |   |
| Total liabilities                                                                                                                                                                                                       |       | 2,223.4               |       | 2,211.9 |   |
| Common stock  purchase subject to guarantee agreement (Note 14)                                                                                                                                                         |       | 2.6                   |       | 2.9 |   |
| Commitments and  contingences (Note 16)                                                                                                                                                                                 |       |                  |       |   |   |
| Stockholders’ equity:                                                                                                                                                                                              |       |                  |       |   |   |
| Common stock, $0.01 par value; 7,000,000 shares  authorized; 5,779,178 shares issued and 5,753,428 outstanding at  December 31, 2005; 5,741,217 shares issued and 5,740,517 outstanding at  December 31, 2004 |       | 0.1                   |       | 0.1 |   |
| Additional paid-in capital                                                                                                                                                                                              |       | 268.0                 |       | 263.4 |   |
| Retained earnings                                                                                                                                                                                                       |       | 43.6                  |       | 22.1 |   |
| Unamortized value of restricted stock issued                                                                                                                                                                            |       | (1.6                  | )          | (0.3 | ) |
| Accumulated other comprehensive income                                                                                                                                                                                  |       | 12.7                  |       | 53.4 |   |
| Treasury stock, at cost, 25,750 shares at  December 31, 2005 and 700 shares at December 31, 2004                                                                                                              |       | (1.5                  | )          | (0.1 | ) |
| Total stockholders’ equity                                                                                                                                                                                         |       | 321.3                 |       | 338.6 |   |
| Total liabilities and  stockholders’ equity                                                                                                                                                                        |       | $                     | 2,547.3    |   | $ | 2,553.4 |   |

 

See accompanying notes to consolidated financial statements.

43

----

**CDRV INVESTORS, INC.Consolidated Statementsof Operations(Dollars in millions)**

| ** **                                                                            | ** ** | **Successor**         | ** ** | ** **                   | ** ** | **Predecessor** | ** ** |
|---------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------------|------------|-----------------|------------|
| ** **                                                                            | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | ** **      | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **                                                                            | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | ** **      | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                                                            | ** ** | **2005**              | ** ** | **2004**                     | ** ** | ** **      | ** ** | **2004** | ** ** | **2003** | ** ** |
| Net sales                                                                             |       |                  | $          | 3,138.2                      |       |            |       | $ | 2,212.2 |   |   |   |   |   | $ | 793.2 |   |   |   | $ | 2,794.2 |   |   |
| Cost of goods  sold                                                                   |       |                  | 2,334.5    |                         |       |            | 1,652.7    |   |   |   |   |   | 588.0 |   |   |   | 2,078.1 |   |   |
| Gross profit                                                                          |       |                  | 803.7      |                         |       |            | 559.5      |   |   |   |   |   | 205.2 |   |   |   | 716.1 |   |   |
| Selling, general  and administrative expenses                                         |       |                  | 640.0      |                         |       |            | 455.6      |   |   |   |   |   | 163.7 |   |   |   | 583.4 |   |   |
| Restructuring  charges (Note 4)                                                       |       |                  | 20.6       |                         |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Operating income                                                                      |       |                  | 143.1      |                         |       |            | 103.9      |   |   |   |   |   | 41.5 |   |   |   | 132.7 |   |   |
| Interest income                                                                       |       |                  | (2.7       | )                            |       |            | (0.8       | ) |   |   |   |   | (0.2 | ) |   |   | (1.7 | ) |   |
| Interest expense:                                                                     |       |                  |       |                         |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest on push down debt                                                            |       |                  | —     |                         |       |            | —     |   |   |   |   |   | 4.1 |   |   |   | 15.2 |   |   |
| All other interest                                                                    |       |                  | 106.7      |                         |       |            | 52.7       |   |   |   |   |   | 1.7 |   |   |   | 10.9 |   |   |
| Other (income)  expense, net                                                          |       |                  | (3.8       | )                            |       |            | (2.1       | ) |   |   |   |   | 0.1 |   |   |   | (3.0 |   |   |
| Income before income taxes and cumulative effect of  a change in accounting principle |       |                  | 42.9       |                         |       |            | 54.1       |   |   |   |   |   | 35.8 |   |   |   | 111.3 |   |   |
| Income tax  provision                                                                 |       |                  | 20.9       |                         |       |            | 23.0       |   |   |   |   |   | 15.1 |   |   |   | 46.2 |   |   |
| Income before cumulative effect of a change in  accounting principle                  |       |                  | 22.0       |                         |       |            | 31.1       |   |   |   |   |   | 20.7 |   |   |   | 65.1 |   |   |
| Cumulative effect  of a change in accounting principle, net of taxes of $0.3 (Note 3) |       |                  | (0.5       | )                            |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Net income                                                                            |       |                  | $          | 21.5                         |       |            |       | $ | 31.1 |   |   |   |   |   | $ | 20.7 |   |   |   | $ | 65.1 |   |   |

 

See accompanying notes to consolidated financial statements.

44

----

**CDRV INVESTORS,INC.Consolidated Statementsof Stockholders’ Equity and**

**Other ComprehensiveIncome (Loss)**

**(Dollars inmillions, except share data)**

**Forthe Period January 1, 2003—April 6, 2004 (Predecessor)**
|                                                                          | ** ** | ** ** | ** **    | ** **     | ** ** | ** **   | ** **   | **Accumulated**        | ** ** | ** ** | ** **                |
|--------------------------------------------------------------------------|------------|------------|---------------|----------------|------------|--------------|--------------|------------------------|------------|------------|---------------------------|
| ** **                                                               | ** ** | ** ** | ** **    | **Additional** | ** ** | ** **   | ** **   | **other**              | ** ** | ** ** | ** **                |
| ** **                                                               | ** ** | **Common** | ** **    | **paid-in**    | ** ** | **Retained** | ** **   | **comprehensive**      | ** ** | ** ** | ** **                |
| ** **                                                               | ** ** | **stock**  | ** **    | **capital**    | ** ** | **earnings** | ** **   | **income (loss)** | ** ** | **Total**  | ** **                |
| Balance at  January 1, 2003                                         |       |       | $ — |           |       |         | $ 216.7 |                   |       |       | $   — |   |   |   | $ (39.8 | ) |   | $ 176.9 |   |
| Comprehensive  income (loss):                                            |       |       |          |           |       |         |         |                   |       |       |                      |   |   |   |   |   |   |   |   |
| Net income                                                               |       |       | —        |           |       |         | —       |                   |       |       | 65.1                      |   |   |   | — |   |   | 65.1 |   |
| Minimum pension liability, net of taxes of $0.8                          |       |       | —        |           |       |         | —       |                   |       |       | —                    |   |   |   | (1.2 | ) |   | (1.2 | ) |
| Foreign currency translation adjustment                                  |       |       | —        |           |       |         | —       |                   |       |       | —                    |   |   |   | 16.8 |   |   | 16.8 |   |
| Unrealized loss on derivatives, net of tax                               |       |       | —        |           |       |         | —       |                   |       |       | —                    |   |   |   | (0.3 | ) |   | (0.3 | ) |
| Total comprehensive income                                               |       |       |          |           |       |         |         |                   |       |       |                      |   |   |   |   |   |   | 80.4 |   |
| Transfers to Merck KGaA and affiliates, net                              |       |       | —        |           |       |         | (1.0         | )                      |       |       | —-                   |   |   |   | — |   |   | (1.0 | ) |
| Capital contribution for interest expense on push  down debt, net of tax |       |       | —        |           |       |         | 9.1          |                   |       |       | —                    |   |   |   | — |   |   | 9.1 |   |
| Balance at  December 31, 2003                                       |       |       | —        |           |       |         | 224.8        |                   |       |       | 65.1                      |   |   |   | (24.5 | ) |   | 265.4 |   |
| Comprehensive  income (loss):                                            |       |       |          |           |       |         |         |                   |       |       |                      |   |   |   |   |   |   |   |   |
| Net income                                                               |       |       | —        |           |       |         | —       |                   |       |       | 20.7                      |   |   |   | — |   |   | 20.7 |   |
| Foreign currency translation adjustment                                  |       |       | —        |           |       |         | —       |                   |       |       | —                    |   |   |   | (3.7 | ) |   | (3.7 | ) |
| Unrealized gain on derivatives, net of tax                               |       |       | —        |           |       |         | —       |                   |       |       | —                    |   |   |   | 0.2 |   |   | 0.2 |   |
| Total comprehensive income                                               |       |       |          |           |       |         |         |                   |       |       |                      |   |   |   |   |   |   | 17.2 |   |
| Capital contribution for interest expense on push  down debt, net of tax |       |       | —        |           |       |         | 2.5          |                   |       |       | —                    |   |   |   | — |   |   | 2.5 |   |
| Balance at April 6,  2004                                           |       |       | $ — |           |       |         | $ 227.3 |                   |       |       | $ 85.8               |   |   |   | $ (28.0 | ) |   | $ 285.1 |   |

 

See accompanying notes to consolidated financial statements.

45

----

**VWR INTERNATIONAL, INC.**

**Consolidated Statements of Stockholders’ Equity andOther Comprehensive Income (Loss) (Continued)**

**(Dollars inmillions, except share data)**

**Forthe Period April 7, 2004—December 31, 2005 (Successor)**
|                                                                                      | ** ** | ** **            | ** ** | ** **  | ** **    | ** **     | ** ** | ** **     | ** **                            | **Unamortized**       | ** ** | **Accumulated**  | ** **          | ** **               | ** ** | ** ** | ** **    | ** ** | ** ** |
|--------------------------------------------------------------------------------------|------------|-----------------------|------------|-------------|---------------|----------------|------------|----------------|---------------------------------------|-----------------------|------------|------------------|---------------------|--------------------------|------------|------------|---------------|------------|------------|
| ** **                                                                           | ** ** | ** **            | ** ** | ** **  | ** **    | **Additional** | ** ** | ** **     | ** **                            | **value of**     | ** ** | **other**        | ** **          | **Treasury Stock,** | ** ** | ** ** | ** **    |
| ** **                                                                           | ** ** | **Common Stock** | ** ** | **paid-in** | ** **    | **Retained**   | ** ** | **restricted** | ** **                            | **comprehensive**     | ** ** | **at cost** | ** **          | ** **               | ** ** |
| ** **                                                                           | ** ** | **Shares**            | ** ** | **Amount**  | ** **    | **capital**    | ** ** | **earnings**   | ** **                            | **stock issued** | ** ** | **income**       | ** **          | **Shares**               | ** ** | **Amount** | ** **    | **Total**  | ** ** |
| Balance at April 7, 2004                                                        |       | —                |       |        | $ — |           |       |           | $     — |                  |       |             | $  — |                     |       |       | $ — |       |       |   | $   — |   |   | — |   |   | $ — |   |   | $     — |   |   |
| Issuance of common stock,  net                                                       |       | 5,500,000             |       |        | 0.1           |           |       |           | 531.2                                 |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | 531.3 |   |   |
| Issuance of common stock in connection with our stock  incentive plan (Note 14)      |       | 241,217               |       |        | —        |           |       |           | 20.8                                  |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | 20.8 |   |   |
| Issuance of restricted common stock, net (Note 15)                                   |       | —                |       |        | —        |           |       |           | 0.3                                   |                  |       |             | —              |                     |       |       | (0.3          | )          |       |   | — |   |   | — |   |   | — |   |   | - |   |   |
| Dividends paid                                                                       |       | —                |       |        | —        |           |       |           | (288.9                                | )                     |       |             | (9.0                | )                        |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | (297.9 | ) |   |
| Acquisition of treasury stock                                                        |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | 700 |   |   | (0.1 | ) |   | (0.1 | ) |   |
| Comprehensive  income (loss):                                                        |       |                  |       |        |          |           |       |           |                                  |                  |       |             |                |                     |       |       |          |       |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                           |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | 31.1                |                     |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | 31.1 |   |   |
| Foreign currency translation adjustment                                              |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | —              |                     |       |       | —        |       |       |   | 54.1 |   |   | — |   |   | — |   |   | 54.1 |   |   |
| Unrealized loss on derivatives, net of tax                                           |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | —              |                     |       |       | —        |       |       |   | (0.7 | ) |   | — |   |   | — |   |   | (0.7 | ) |   |
| Total comprehensive income                                                 |       |                  |       |        |          |           |       |           |                                  |                  |       |             |                |                     |       |       |          |       |       |   |   |   |   |   |   |   |   |   |   | 84.5 |   |   |
| Balance at December 31, 2004                                                    |       | 5,741,217             |       |        | 0.1           |           |       |           | 263.4                                 |                  |       |             | 22.1                |                     |       |       | (0.3          | )          |       |   | 53.4 |   |   | 700 |   |   | (0.1 | ) |   | 338.6 |   |   |
| Issuance of common stock in connection with our stock  incentive plan (Note 14)      |       | 29,032                |       |        | —        |           |       |           | 1.6                                   |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | 1.6 |   |   |
| Issuance of restricted common stock, net (Note 15)                                   |       | —                |       |        | —        |           |       |           | 1.3                                   |                  |       |             | —              |                     |       |       | (1.3          | )          |       |   | — |   |   | — |   |   | — |   |   | — |   |   |
| Issuance of common stock in connection with  acquisition (Notes 5 and 14)            |       | 8,929                 |       |        | —        |           |       |           | 0.5                                   |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | 0.5 |   |   |
| Reduction of common stock purchase subject to  guarantee agreement    |       | —                |       |        | —        |           |       |           | 0.3                                   |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | 0.3 |   |   |
| Stock-based compensation                                                             |       | —                |       |        | —        |           |       |           | 0.9                                   |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | — |   |   | — |   |   | 0.9 |   |   |
| Acquisition of treasury stock                                                        |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | —              |                     |       |       | —        |       |       |   | — |   |   | 25,050 |   |   | (1.4 | ) |   | (1.4 | ) |   |
| Comprehensive  income (loss):                                                        |       |                  |       |        |          |           |       |           |                                  |                  |       |             |                |                     |       |       |          |       |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                           |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | 21.5                |                     |       |       | -             |       |       |   | - |   |   | - |   |   | - |   |   | 21.5 |   |   |
| Minimum pension liability, net of taxes of $7.6                                      |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | —              |                     |       |       | —        |       |       |   | (11.9 | ) |   | — |   |   | — |   |   | (11.9 | ) |   |
| Foreign currency translation adjustment                                              |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | —              |                     |       |       | —        |       |       |   | (29.2 | ) |   | — |   |   | — |   |   | (29.2 | ) |   |
| Unrealized gain on derivatives, net of tax                                           |       | —                |       |        | —        |           |       |           | —                                |                  |       |             | —              |                     |       |       | —        |       |       |   | 0.4 |   |   | — |   |   | — |   |   | 0.4 |   |   |
| Total comprehensive (loss)                                            |       |                  |       |        |          |           |       |           |                                  |                  |       |             |                |                     |       |       |          |       |       |   |   |   |   |   |   |   |   |   |   | (19.2 | ) |   |
| Balance at  December 31, 2005                                                   |       | 5,779,178             |       |        | $ 0.1    |           |       |           | $ 268.0                          |                  |       |             | $ 43.6         |                     |       |       | $ (1.6   | )          |       |   | $ 12.7 |   |   | 25,750 |   |   | $ (1.5 | ) |   | $ 321.3 |   |   |

 

See accompanying notes to consolidated financial statements.

46

----

**CDRV INVESTORS, INC.Consolidated Statementsof Cash Flows(Dollars in millions)**
|                                                                                           | ** ** | **Successor**         | ** ** | ** **             | ** ** | **Predecessor** | ** ** |
|-------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|-----------------|------------|
| ** **                                                                                | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | ** **      | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                                                                                | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | ** **      | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                                                                | ** ** | **2005**              | ** ** | **2004**               | ** ** | ** **      | ** ** | **2004** | ** ** | **2003** | ** ** |
| Cash flows from operating activities:                                                     |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                                |       |                  | $          | 21.5                   |       |            |       | $ | 31.1 |   |   |   |   |   | $ | 20.7 |   |   |   | $ | 65.1 |   |   |
| Adjustments to reconcile net income to net cash  provided by operating activities:        |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                             |       |                  | 33.9       |                   |       |            | 25.8       |   |   |   |   |   | 8.9 |   |   |   | 32.9 |   |   |
| Gain on sale of assets                                                                    |       |                  | (0.5       | )                      |       |            | —     |   |   |   |   |   | — |   |   |   | (1.4 | ) |   |
| Cumulative effect of a  change in accounting principle                                    |       |                  | 0.5        |                   |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Interest on push down  debt, net of tax                                                   |       |                  | —     |                   |       |            | —     |   |   |   |   |   | 2.5 |   |   |   | 9.1 |   |   |
| Non-cash interest  accretion                                                              |       |                  | 29.6       |                   |       |            | 1.2        |   |   |   |   |   | — |   |   |   | — |   |   |
| Non-cash provision for  restructuring charges                                             |       |                  | 11.5       |                   |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Non-cash equity  compensation expense                                                     |       |                  | 0.9        |                   |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Amortization of debt  issuance costs                                                      |       |                  | 5.4        |                   |       |            | 3.7        |   |   |   |   |   | — |   |   |   | — |   |   |
| Deferred income tax  expense                                                              |       |                  | 1.7        |                   |       |            | 3.0        |   |   |   |   |   | 0.9 |   |   |   | 14.0 |   |   |
| Provision for doubtful  accounts                                                          |       |                  | 3.2        |                   |       |            | 2.5        |   |   |   |   |   | 0.6 |   |   |   | 4.0 |   |   |
| Changes in working capital, net of effect of business  acquisitions:                      |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Trade accounts receivable                                                                 |       |                  | (14.6      | )                      |       |            | 4.9        |   |   |   |   |   | (26.8 | ) |   |   | 2.3 |   |   |
| Other receivables                                                                         |       |                  | (11.3      | )                      |       |            | (7.0       | ) |   |   |   |   | 8.7 |   |   |   | 1.5 |   |   |
| Inventories                                                                               |       |                  | (29.0      | )                      |       |            | 20.5       |   |   |   |   |   | 17.5 |   |   |   | 13.4 |   |   |
| Other assets                                                                              |       |                  | (2.0       | )                      |       |            | (1.1       | ) |   |   |   |   | 1.9 |   |   |   | 7.8 |   |   |
| Accounts payable                                                                          |       |                  | 32.4       |                   |       |            | 0.2        |   |   |   |   |   | 61.7 |   |   |   | 4.6 |   |   |
| Other liabilities                                                                         |       |                  | (13.1      | )                      |       |            | 3.1        |   |   |   |   |   | 0.9 |   |   |   | 1.8 |   |   |
| Net cash provided by  operating activities                                                |       |                  | 70.1       |                   |       |            | 87.9       |   |   |   |   |   | 97.5 |   |   |   | 155.1 |   |   |
| Cash flows from investing activities:                                                     |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Payment to Merck KGaA and  affiliates to acquire business, net of cash acquired of $130.8 |       |                  | —     |                   |       |            | (1,539.1   | ) |   |   |   |   | — |   |   |   | — |   |   |
| Transaction costs                                                                         |       |                  | (1.5       | )                      |       |            | (20.5      | ) |   |   |   |   | — |   |   |   | — |   |   |
| Acquisitions of  businesses                                                               |       |                  | (44.5      | )                      |       |            | (2.7       | ) |   |   |   |   | — |   |   |   | — |   |   |
| Capital expenditures                                                                      |       |                  | (18.4      | )                      |       |            | (13.1      | ) |   |   |   |   | (3.3 | ) |   |   | (16.6 | ) |   |
| Proceeds from sales of  property and equipment                                            |       |                  | 2.2        |                   |       |            | 1.2        |   |   |   |   |   | 0.4 |   |   |   | 7.7 |   |   |
| Net cash used in  investing activities                                                    |       |                  | (62.2      | )                      |       |            | (1,574.2   | ) |   |   |   |   | (2.9 | ) |   |   | (8.9 | ) |   |
| Cash flows from financing activities:                                                     |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from debt                                                                        |       |                  | 3.2        |                   |       |            | 1,466.9    |   |   |   |   |   | 13.3 |   |   |   | 136.2 |   |   |
| Repayment of debt                                                                         |       |                  | (13.9      | )                      |       |            | (111.1     | ) |   |   |   |   | (6.8 | ) |   |   | (265.5 | ) |   |
| Decrease (increase) in  notes receivable from Merck KGaA and affiliates                   |       |                  | —     |                   |       |            | —     |   |   |   |   |   | 4.1 |   |   |   | (9.1 | ) |   |
| Net change in bank checks  outstanding                                                    |       |                  | 15.0       |                   |       |            | 25.0       |   |   |   |   |   | (2.1 | ) |   |   | (5.4 | ) |   |
| Issuance of 100 shares of  common stock, net of expenses                                  |       |                  | —     |                   |       |            | 531.3      |   |   |   |   |   | — |   |   |   | — |   |   |
| Proceeds from stock  incentive plan                                                       |       |                  | 1.3        |                   |       |            | 23.8       |   |   |   |   |   | — |   |   |   | — |   |   |
| Cash paid for debt  issuance costs                                                        |       |                  | (0.8       | )                      |       |            | (38.8      | ) |   |   |   |   | — |   |   |   | — |   |   |
| Dividends paid                                                                            |       |                  | —     |                   |       |            | (297.9     | ) |   |   |   |   | — |   |   |   | — |   |   |
| Acquisition of treasury  stock                                                            |       |                  | (1.4       | )                      |       |            | (0.1       | ) |   |   |   |   | — |   |   |   | — |   |   |
| Other                                                                                     |       |                  | —     |                   |       |            | —     |   |   |   |   |   | — |   |   |   | (1.0 | ) |   |
| Net cash provided by  (used in) financing  activities                                     |       |                  | 3.4        |                   |       |            | 1,599.1    |   |   |   |   |   | 8.5 |   |   |   | (144.8 | ) |   |
| Effect of exchange rate  changes on cash                                                  |       |                  | (2.1       | )                      |       |            | 4.1        |   |   |   |   |   | (0.6 | ) |   |   | 2.2 |   |   |
| Net increase in cash and  cash equivalents                                                |       |                  | 9.2        |                   |       |            | 116.9      |   |   |   |   |   | 102.5 |   |   |   | 3.6 |   |   |
| Cash and cash equivalents  beginning of period                                            |       |                  | 116.9      |                   |       |            | —     |   |   |   |   |   | 28.3 |   |   |   | 24.7 |   |   |
| Cash and cash equivalents  end of period                                                  |       |                  | $          | 126.1                  |       |            |       | $ | 116.9 |   |   |   |   |   | $ | 130.8 |   |   |   | $ | 28.3 |   |   |
| Supplemental disclosures of cash flow information:                                        |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash paid during the period for:                                                          |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                                                                                  |       |                  | $          | 70.4                   |       |            |       | $ | 33.9 |   |   |   |   |   | $ | 1.3 |   |   |   | $ | 11.3 |   |   |
| Income taxes paid, net                                                                    |       |                  | $          | 12.6                   |       |            |       | $ | 29.1 |   |   |   |   |   | $ | 4.2 |   |   |   | $ | 33.9 |   |   |
|                                                                                           |            |                       |            |                        |            |                 |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

See accompanying notes to consolidated financial statements.

47

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

**(1)   Background and Nature of Operations**

CDRV Investors, Inc. (“CDRV,” the “Company,” “us,”“we” or “our”) was incorporated in Delaware on February 9, 2004 byClayton, Dubilier & Rice Fund VI Limited Partnership. CDRV through itsindirect wholly-owned subsidiary, VWR International, Inc. (“VWR”),distributes scientific supplies, chemicals, and equipment, primarily in NorthAmerica and Europe. The business is diversified across products and services,customer groups, and geography. The Company’s principal customers arepharmaceutical, biotechnology, chemical, technology, food processing, andconsumer product companies; universities and research institutes; governmentagencies; environmental testing organizations; and primary and secondaryschools.

The Company operates in North America (United States,Canada, Puerto Rico and Mexico) and in the following countries in Europe:Austria, Belgium, Denmark, Finland, France, Germany, Ireland, Italy,Netherlands, Norway, Portugal, Spain, Sweden, Switzerland, and the UnitedKingdom.

The Company’s North American business was formerly theVWR Scientific Products Corporation (“VWRSP”). In 1995, Merck KGaA, VWRInternational Corporation’s (VWR’s predecessor) ultimate parent company until April 7,2004, headquartered in Darmstadt, Germany, agreed to acquire approximately49.9% of the then-outstanding shares of VWRSP. In 1999, following a tenderoffer for the remaining shares; VWRSP became a wholly-owned subsidiary of MerckKGaA (collectively, the “VWRSP Acquisition”) (See Note 5(c)).

Effective January 1, 2001, Merck KGaA combined,for management purposes only, the Company’s North American business with MerckKGaA’s European business and the combined businesses operated under the nameVWR International.

On December 6, 2002, VWR InternationalCorporation was incorporated in Delaware. On December 31, 2002, Merck KGaAentered into a series of reorganization transactions whereby all of the legalentities, which comprised the North American and European businesses, werecontributed to VWR International Corporation and became wholly-ownedsubsidiaries of VWR International Corporation. VWR International Corporationwas 100% owned by subsidiaries of Merck KGaA.

As more fully discussed in Note 5(a), on April 7,2004, Merck KGaA sold all of the outstanding shares of capital stock of VWRInternational Corporation to CDRV Acquisition Corporation (“CDRVA”), awholly-owned subsidiary of CDRV Holdings, Inc., a wholly-owned subsidiaryof the Company, for a purchase price of approximately $1,684.2, consisting ofapproximately $1,669.9 in cash and approximately $14.3 of assumed debt (the “Acquisition”).In addition, direct acquisition costs of approximately $77.5 were incurred.CDRVA financed the Acquisition through a $550.0 equity investment, approximately$1,110.5 in various debt instruments, acquired cash of $70.1 and accruedexpenses of $16.8.

In connection with the Acquisition, CDRVA issued$200.0 of 67¤8%Unsecured Senior Notes due 2012 and $320.0 of 8% Unsecured Senior SubordinatedNotes due 2014 (the “VWR Notes”) and obtained financing under a new seniorsecured credit facility (the “Senior Secured Credit Facility”). Following thecompletion of the Acquisition, there were a series of internal reorganizations,pursuant to which, among other things, (i) VWR International Corporationmerged with and into VWR International, Inc., with VWR International, Inc.surviving, and (ii) thereafter, CDRVA merged with and into VWRInternational, Inc., with VWR International, Inc. surviving andassuming the obligations of CDRVA.

On December 16, 2004, we issued $481.0 of 95¤8%Senior Discount Notes due 2015 (“Senior Discount Notes”). Prior to thisissuance, we had not had any significant operating, investing or financingactivities 

48

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

other than being theholding company of CDRV Holdings, Inc., which in turn, had not had anysignificant operating, investing or financing activities other than being theholding company of VWR and the indirect holder of the approximately 6% equityownership in VWR International Immobilien GmbH that VWR did not hold. The netproceeds from the issuance of the Senior Discount Notes of approximately $297.9were used to pay a cash dividend to the holders of our common stock.

The term “successor” refers to CDRV following theAcquisition. The term “predecessor” refers to VWR International Corporationprior to the change in control on April 7, 2004. CDRVA had no operationsprior to the Acquisition.

The financial statements, for all periods presentedprior to the Acquisition, do not include allocations of Merck KGaA generalcorporate expenses or charges for financial reporting, tax, and treasuryservices, as such costs were not charged to VWR International Corporation.Management does not believe that charges for such services would have beenmaterial. See Note 17 for a further discussion of transactions with Merck KGaA.

The financial statements, for all periods presentedprior to the Acquisition, reflect the push down of the purchase price paid byMerck KGaA for VWR International Corporation to the VWR InternationalCorporation financial statements that resulted in the recognition of push downdebt due Merck KGaA or a contribution to stockholders’ equity for cashconsideration. For all periods prior to the Acquisition, interest expense wasrecorded on this push down debt based upon Merck KGaA’s intercompany interestrates, which are not necessarily indicative of rates VWR InternationalCorporation would have obtained if it were not an ultimate subsidiary of MerckKGaA. Interest expense, including tax effects on push down debt, has beenincluded in the statements of operations, and presented as a non-cash item inthe accompanying statements of cash flows and a capital contribution in thestatements of stockholders’ equity and other comprehensive income (loss), asthis interest was not required to be paid to Merck KGaA.

**(2)**   Summary ofSignificant Accounting Policies

The accounting policies as described herein areapplicable to both the predecessor and successor financial statements unlessspecifically noted therein.

***(a)   Principles of Consolidation***

The accompanying consolidated financial statementsinclude the accounts of CDRV and its subsidiaries after elimination of allintercompany balances and transactions.

***(b)   Cash and Cash Equivalents***

Cash and cash equivalents are comprised of highlyliquid investments with insignificant interest rate risk and having originalmaturities of three months or less. The amount of restricted cash was $1.2 and$1.5 at December 31, 2005 and 2004, respectively.

***(c)***   Trade AccountsReceivables Reserve

The carrying amount of accounts receivable reflects areserve representing our best estimate of the amounts that will not becollected and for estimated sales returns and allowances. In addition toreviewing delinquent accounts receivable, we consider many factors inestimating our reserve, including historical data, experience, customer types,credit worthiness, and economic trends. From time to time, we may 

49

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

adjust our assumptions foranticipated changes in any of these or other factors expected to affectcollectibility.

***(d)   Inventories***

Inventories are valued at the lower of cost or market,cost being determined principally by the last-in, first-out (“LIFO”) method forour U.S. subsidiaries and the average cost or the first-in, first-out (“FIFO”)method for all other subsidiaries. The Company periodically reviews quantitiesof inventories on hand and compares these amounts to the expected use of eachproduct or product line. The Company records a charge to cost of sales for theamount required to reduce the carrying value of inventory to net realizablevalue. Costs associated with the procurement and warehousing of inventories,such as inbound freight charges, purchasing and receiving costs, and internaltransfer costs, are included in the cost of sales line item within thestatement of operations.

***(e)   Property and Equipment***

Property and equipment are recorded at cost. Propertyand equipment held under capital leases are stated at the present value ofminimum lease payments. Depreciation is computed using the straight-line methodas follows: buildings and improvements, 10 to 40 years; equipment and software,3 to 10 years. Property and equipment held under capital leases and leaseholdimprovements are amortized over the shorter of the remaining life of the leaseor the useful lives of the improvements. Costs for repairs and maintenance thatdo not significantly increase the value or estimated lives of property andequipment are treated as expense as such expenses are incurred.

***(f)   Goodwill and Intangible Assets***

Goodwill represents the excess of costs over fairvalue of assets of businesses acquired. In accordance with the provisions ofStatement of Financial Accounting Standards (“SFAS”) No. 142, *Goodwill and Other Intangible Assets*(“SFASNo. 142”), goodwill and intangible assets acquired in a purchase businesscombination and determined to have an indefinite useful life are not amortized,but instead are tested for impairment. SFAS No. 142 also requires thatintangible assets with finite useful lives be amortized over their respectiveestimated useful lives to their estimated residual values, and reviewed forimpairment in accordance with SFAS No. 144, *Accounting for Impairment or Disposal of Long-Lived Assets*.

SFAS No. 142 requires that goodwill be testedannually or between annual tests if events occur or circumstances change thatwould more likely than not reduce the fair value of a reporting unit below itscarrying amounts. The Company has elected to perform its annual test for indicationsof goodwill impairment in the fourth quarter of each year. The test wasperformed and no impairment was identified.

Goodwill included in the financial statementsprimarily represents the excess of acquisition costs over the fair value of netassets acquired in connection with the Acquisition as discussed in Note 5(a).

***(g)   Impairment of Long-Lived Assets***

The Company evaluates the recoverability of long-livedassets used in operations when events or circumstances indicate a possibleinability to recover carrying amounts. Such evaluations are based onundiscounted cash flow and profitability projections. An impairment charge isrecorded for the difference between the fair value and carrying value of theasset. No impairment losses were recorded in 2005, 2004 or 2003.

50

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(h)   Advertising***

The Company expensesadvertising costs as incurred, except for certain direct-response advertising,which is capitalized and amortized over its expected period of future benefit,generally from 12 to 48 months. Capitalized direct-response advertising, whichis included in other current assets and other assets, consists of catalogproduction and mailing costs that are expensed from the date catalogs aremailed. Capitalized direct-response advertising as of December 31, 2005and 2004 were $8.8 and $9.8, respectively. The table below shows totaladvertising expense for each of the reporting periods.

| ** **           | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|----------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **           | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **           | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **           | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Advertising  expense |       |                  | $          | 20.7                         |       |   |   | $ | 16.4 |   |   |   | $ | 5.4 |   |   |   | $ | 23.2 |   |   |
|                      |            |                       |            |                              |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

***(i)   Revenue Recognition***

The Company records revenue when persuasive evidenceof an arrangement exists, the price is fixed or determinable, title and risk ofloss have been transferred to the customer, and collectibility of the resultingreceivable is reasonably assured. Risk of loss is transferred at the time ofshipment or upon delivery to customers, depending upon the terms of thearrangement with the customer. Products are delivered without significantpost-sale obligations to the customer. Provisions for discounts, and rebates tocustomers, sales returns, and other adjustments are provided for as a reductionof sales in the period the related sales are recorded. Service revenue is recognizedwhen the services are performed.

***(j)   Shipping and Handling***

The Company records shipping and handling chargesbilled to customers in net sales and records shipping and handling costs incost of goods sold for all periods presented.

***(k)   Income Taxes***

Income taxes are accounted for under SFAS No. 109,*Accounting for Income Taxes*,which requires the asset and liability method under which deferred income taxesare recognized for the expected net tax effects of temporary differencesbetween the carrying amounts of assets and liabilities for financial reportingand income tax purposes. Deferred tax assets and liabilities are measured usingthe enacted tax rates expected to apply to taxable income in the years in whichthose temporary differences are expected to be recovered or settled. The effecton deferred tax assets and liabilities of a change in tax rates is recognizedin income in the period that includes the enactment date. The Company records avaluation allowance to reduce deferred tax assets to the amount that is morelikely than not to be realized.

***(l)   Insurance***

Certain insurable risks such as commercial generalliability; property damage and business interruption; and workers’ compensationare insured by third parties. However, the Company self-insures certaincomponents of these risk exposures at various deductible levels. Accruals forclaims under the Company’s self-insurance programs are recorded on aclaims-incurred basis.

51

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(m)   Pensions and Other Postretirement Plans***

The Company has definedbenefit plans covering certain of its employees. The benefits include pension,salary continuance, severance, life insurance, and health care. Benefits areaccrued over the employee’s service period.

***(n)***   Concentrations ofCredit Risk

Trade receivables reflecta diverse customer base and our wide geographic dispersion of businesses. As aresult, no significant concentrations of credit risk exist.

***(o)***   Stock-BasedCompensation

TheCompany measures compensation expense for its stock-based employee compensationplan using the intrinsic value method of Accounting Principles Board Opinion No. 25,*Accounting for Stock Issued to Employees*(“APB No. 25”). The Company has adopted the disclosure-only provisions ofSFAS No. 148, *Accounting forStock-Based Compensation-Transition and Disclosure, an amendment of FASBStatement No. 123*(“SFAS No. 148”). Therefore, the Companyhas not recognized compensation expense for its options granted because suchoptions had an exercise price equal to their fair market value on the date ofgrant. Had compensation expense for the Company’s stock options granted beendetermined based on the fair value at the grant date for awards under the plan,consistent with the methodology prescribed under SFAS No. 148, the Company’snet income would have approximated the pro-forma amounts indicated below:

| ** **                                                                                                     | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** |
|----------------------------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **                                                                                                     | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** |
| ** **                                                                                                     | ** ** | **2005**              | ** ** | **2004**                     | ** ** |
| Net income as  reported                                                                                        |       |                  | $          | 21.5                         |       |   |   | $ | 31.1 |   |   |
| Add: stock-based  compensation expense in reported net income, net of tax                                      |       |                  | 0.5        |                         |       |   | — |   |   |
| Deduct:  stock-based compensation expense determined using fair value based method for  all awards, net of tax |       |                  | (1.4       | )                            |       |   | (0.3 | ) |   |
| Pro-forma net income                                                                                           |       |                  | $          | 20.6                         |       |   |   | $ | 30.8 |   |   |

 

Thefair value of the Company’s stock options was estimated using the Black-Scholesoption-pricing model with the following weighted average assumptions:

| ** **                | ** ** | ** **            | ** ** | **Options**             | ** ** |
|---------------------------|------------|-----------------------|------------|-------------------------|------------|
| ** **                | ** ** | **Options**           | ** ** | **Granted in**     | ** ** |
| ** **                | ** ** | **Granted in**   | ** ** | **the period**     | ** ** |
| ** **                | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** |
| ** **                | ** ** | **December 31,** | ** ** | **December 31,**   | ** ** |
| ** **                | ** ** | **2005**              | ** ** | **2004**                | ** ** |
| Risk free  interest rate  |       |                  | 4.11%      |                    |       |   | 3.79% |   |   |
| Expected life of  options |       |                  | 6.5 years  |                    |       |   | 6.5 years |   |   |
| Volatility                |       |                  | 38%        |                    |       |   | 20% |   |   |
| Expected dividend yield   |       |                  | 0.0%       |                    |       |   | 0.0% |   |   |

 

52

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(p)***   Foreign CurrencyTranslation

Assetsand liabilities of the Company’s foreign subsidiaries, where the functionalcurrency is the local currency, are translated into U.S. dollars usingperiod-end exchange rates, and income and expenses are translated using averageexchange rates. Resulting translation adjustments are reported as a separatecomponent of stockholders’ equity. Foreign currency translation adjustments forexchange gains and losses on transactions are included in other (income)expense, net, and were as follows:

| ** **           | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|----------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **           | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **           | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **           | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Exchange gains,  net |       |                  | $          | 2.8                          |       |   |   | $ | 1.1 |   |   |   | $ | 0.4 |   |   |   | $ | 0.1 |   |   |
|                      |            |                       |            |                              |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

There have been nosignificant fluctuations in foreign currency exchange rates since December 31,2005.

***(q)   Financial Instruments and Derivatives***

The Company accounts for derivative financialinstruments in accordance with SFAS No. 133, *Accounting for Derivative Instruments and Hedging Activities,*as amended. All derivatives, whether designated for hedging relationships ornot, are recorded on the balance sheet at fair value. If the derivative isdesignated as a fair value hedge, the changes in the fair value of thederivative and of the hedged item attributable to the hedged risk arerecognized in the results of operations. If the derivative is designated as acash flow hedge, the effective portions of changes in the fair value of thederivative are recorded in accumulated other comprehensive income and arerecognized in the results of operations when the hedged item affects earnings.Ineffective portions of changes in the fair value cash flow hedges arerecognized in the results of operations. For derivative instruments notdesignated as hedging instruments, changes in fair value are recognized in theresults of operations in the current period.

The Company enters into foreign currency forwardcontracts primarily to hedge exposures to fluctuations in foreign currencyrates that arise from purchasing of products that are denominated in foreigncurrencies. Gains and losses on the foreign currency forward contractsgenerally offset gains and losses on certain expected commitments. To theextent these foreign currency forward contracts are considered effectivehedges, gains and losses on these positions are deferred and included in thebasis of the transaction when it is completed. Cash flows from foreign currencyforward contracts accounted for as hedges are classified in the statement ofcash flows in the same category as the item being hedged or on a basis consistentwith the nature of the instrument.

The Company uses aninterest rate cap agreement to manage its exposure to interest rate risk. Thisinterest rate cap is designated as a cash flow hedge of the Company’s variablerate debt. This agreement is for two years and matures July 2006. Amountsaccumulated in other comprehensive income are reclassified into earnings asinterest is accrued on the hedge transactions. The amounts accumulated in othercomprehensive income will fluctuate based on changes in the fair value of theCompany’s derivatives at each reporting period.

53

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(r)   Investments***

The Company accounts forits 24% investment in a business using the equity method of accounting.

***(s)   Other Comprehensive Income (Loss)***

Components of other comprehensive income (loss) arecumulative foreign currency translation adjustments, cumulative minimum pensionliability adjustments, and unrealized gain (loss) on derivatives. We reportother comprehensive income (loss) in our consolidated statements ofstockholders’ equity and other comprehensive income (loss).

Accumulatedother comprehensive income (loss) net of tax, consist of:

| ** **                                | ** ** | **December 31,** | ** ** |
|-------------------------------------------|------------|-----------------------|------------|
| ** **                                | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Foreign currency  translation adjustments |       | $                     | 24.9       |   | $ | 54.1 |   |
| Unrealized loss  on derivatives           |       | (0.3                  | )          | (0.7 | ) |
| Minimum pension  liability adjustments    |       | (11.9                 | )          | — |   |
|                                      |       | $                     | 12.7       |   | $ | 53.4 |   |

 

***(t)   Reclassifications***

Certain amounts from prior periods have beenreclassified to conform to the current presentation.

***(u)   Useof Estimates***

The preparation of financial statements in conformitywith accounting principles generally accepted in the United States of Americarequires management to make estimates and assumptions that affect the reportedamounts of assets and liabilities and disclosure of contingent assets andliabilities at the date of the financial statements and the reported amounts ofrevenues and expenses during the reporting period. While actual results coulddiffer from those estimates, management believes that the estimates arereasonable.

***(v)   NewAccounting Standards***

DuringDecember 2004, the Financial Accounting Standards Board (“FASB”) issuedSFAS No. 123 Revised, *Share-BasedPayment* (“SFAS No. 123R”). This Statement requires companies torecognize in the income statement, the grant date value of stock options andother forms of equity-based compensation issued to employees. The provisions ofthis Statement become effective at the beginning of 2006. During August 2004,we introduced a share-based compensation arrangement as a component of ourcompensation plans for our employees. Effective January 1, 2006 we are nolonger permitted to follow the intrinsic value accounting method of APB No. 25,and SFAS No. 123R will apply to all of our outstanding unvested options asof January 1, 2006 and all prospective awards using the modifiedprospective transition method without restatement of prior periods. The impactthis Statement will have on the Company’s results of operations will besubstantially consistent with the pro-forma amounts shown in Note 2(o).

54

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

During November 2004, the FASB issued SFAS No. 151,*Inventory Costs*. This Statementclarifies the accounting for abnormal amounts of idle facility expenses,freight handling costs, and spoilage. This Statement requires such excess costsbe charged as current-period expenses. This Statement also specifies thatallocated overhead costs to inventory must be based on normal capacitymeasures. This Statement becomes effective for inventory costs incurredbeginning January 1, 2006. The adoption of this standard is not expectedto materially impact the Company.

**(3) Change in Accounting Principle**

SFASNo. 143, *Accounting for AssetRetirement Obligations* (“SFAS No. 143”) addresses financialaccounting and reporting for obligations associated with the retirement oftangible long-lived assets and the associated asset retirement costs. SFAS No. 143requires recognition of a liability at fair value and an increase to thecarrying value of the related asset for any retirement obligation. This amountis depreciated over the life of the asset. The liability is adjusted to reflectthe passage of time and changes in the estimated future cash flows. SFAS No. 143was effective for the Company as of January 1, 2003.

In March 2005, the FASB issued Interpretation No. 47,*Accounting for Conditional Asset RetirementObligations* (“FIN 47”). FIN 47 clarifies that the term conditionalasset retirement obligation, as used in SFAS No. 143, refers to a legalobligation to perform an asset retirement activity in which the timing and/or methodof settlement are conditional on a future event that may or may not be withinthe control of the Company. FIN 47 requires that a liability for the fair valueof a conditional asset retirement obligation be recognized if the fair value ofthe liability can be reasonably estimated.

***(a)   Effectof Adopting FIN 47***

We adopted FIN 47effective December 31, 2005. Our conditional asset retirement obligationsprimarily relate to restoration costs for leased facilities including theremoval of certain leasehold improvements. As a result of the adoption of FIN47, we recorded the following amounts in our financial statements as of and forthe year ended December 31, 2005:

| Consolidated  Statement of Operations:                                                  |   |   |   |
|-----------------------------------------------------------------------------------------|--------|--------|--------|
| Charge for cumulative effect of a change in accounting  principle, net of taxes of $0.3 |   | $      | 0.5    |   |
| Consolidated Balance Sheet:                                                             |   |   |   |
| Property and equipment, net of accumulated  depreciation of $0.5                        |   | 1.5    |   |
| Deferred income tax asset                                                               |   | 0.3    |   |
| Long-term  liabilities for asset retirement obligations                                 |   | 2.3    |   |
|                                                                                         |        |        |        |  |

 

Thecumulative effect of the adoption of FIN 47 of $0.5 reflects charges since theAcquisition. Asset retirement obligations have been adjusted to reflect thecumulative accretion of all related liabilities to December 31, 2005.

On a pro-forma basis, the liabilities for assetretirement obligations if FIN 47 had been adopted on January 1, 2003 wouldhave been as follows: January 1, 2003 - $1.7, December 31, 2003 -$1.9 and 

55

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

December 31, 2004 -$2.2. These pro-forma amounts are estimated based upon the information, assumptionsand interest rates used to measure the liabilities for asset retirementobligations recognized upon adoption of FIN 47 as of December 31, 2005.Had we adopted FIN 47 at the beginning of 2003, the pro-forma consolidatedstatements of operations would not have been materially different from theamounts reported.

***(b)   ProspectiveAccounting Methodology Under FIN 47***

The liabilities for asset retirement obligations willbe adjusted on an ongoing basis due to the passage of time, new laws andregulations and revisions to either the timing or amount of the originalestimates. These liabilities will be accreted to their full estimatedsettlement amounts through the estimated ultimate settlement dates of theunderlying obligations. This accretion charge will be reflected as a componentof selling, general and administrative expense in our consolidated statement ofoperations. Net asset retirement costs will be depreciated over the remaininglease terms or lives of the related assets. This charge will be recorded asdepreciation expense in our consolidated statement of operations.

**(4)   Restructuring**

***(a)   Restructuringas a Result of the Acquisition***

Subsequentto the Acquisition, we initiated restructuring activities designed to reduceoperating costs and improve the operating and administrative capabilities ofthe Company. The initial focus was on the Company’s European operations andorganizational structure and, to a lesser extent, the operations in NorthAmerica. In connection with this initial focus, we recorded restructuringaccruals of $29.7 in 2004. These charges primarily related to reductions inheadcount in Europe due to the reorganization of the Company’s European salesand marketing functions.

Inearly 2005, we implemented various restructuring plans that were formulated in2004 and were in the planning and evaluation stages. Accordingly, we recordedadditional restructuring accruals of approximately $24.5 in the first half of2005. These charges primarily reflect severance and other exit costs includingestimates for environmental remediation associated with cessation ofmanufacturing operations at a plant in France and severance costs associatedwith the consolidation of certain sales and marketing personnel in our Germanand UK operations.

Thesecharges have been recorded as adjustments to acquisition costs (increases togoodwill) pursuant to the provisions of Emerging Issues Task Force Issue No. 95-3,*Recognition of Liabilities in Connectionwith a Purchase Business Combination* (“EITF 95-3”).

Thecharge for environmental remediation in France was initially estimated at $6.4based on a preliminary study conducted by an environmental engineering firm. Wehave updated these estimates in coordination with the environmental engineeringfirm and have determined that our estimate for remediation costs should be$3.9. Accordingly, we have reduced the reserve and goodwill by $2.5 atDecember 31, 2005. In addition, we have also reduced our severanceaccruals, primarily in France and the UK, by $1.7 with a correspondingreduction to goodwill.

56

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

The following table setsforth the activity associated with the Company’s liabilities for restructuringas a result of the Acquisition.

| ** **                            | ** ** | **Severance**   | ** ** | ** **     | ** ** | ** ** | ** ** | ** ** | ** ** |
|---------------------------------------|------------|-----------------|------------|----------------|------------|------------|------------|------------|------------|
| ** **                            | ** ** | **and**         | ** ** | ** **     | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                            | ** ** | **termination** | ** ** | **Facilities** | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                            | ** ** | **benefits**    | ** ** | **related**    | ** ** | **Other**  | ** ** | **Total**  | ** ** |
| Balance as of April 7,  2004     |       |            | $          | —         |       |       |       | $          | —     |   |   | $ | — |   | $ | — |   |
| Accruals charged to  goodwill         |       |            | 28.2       |           |       |       | 0.6        |       |       | 0.9 |   | 29.7 |   |
| Cash payments/other                   |       |            | (7.9       | )              |       |       | (0.1       | )          |       | (0.6 | ) | (8.6 | ) |
| Currency translation  changes         |       |            | 0.7        |           |       |       | —     |       |       | — |   | 0.7 |   |
| Balance as of  December 31, 2004 |       |            | 21.0       |           |       |       | 0.5        |       |       | 0.3 |   | 21.8 |   |
| Accruals charged to  goodwill         |       |            | 13.4       |           |       |       | 10.9       |       |       | 0.2 |   | 24.5 |   |
| Cash payments/other                   |       |            | (24.7      | )              |       |       | (0.6       | )          |       | (0.5 | ) | (25.8 | ) |
| Revisions to estimates                |       |            | —     |           |       |       | (4.2       | )          |       | — |   | (4.2 | ) |
| Currency translation  changes         |       |            | (2.1       | )              |       |       | (1.0       | )          |       | — |   | (3.1 | ) |
| Balance as of December 31, 2005  |       |            | $          | 7.6            |       |       |       | $          | 5.6        |   |   | $ | — |   | $ | 13.2 |   |

 

***(b)   Other restructuring activities***

In addition, we initiated several cost reductionprograms in response to relatively static market conditions and implementedreductions in force and other cost containment measures during 2005. Inconnection with these actions, we recorded accruals related to severance andfacility exit costs totaling $20.6 and incurred approximately $2.1 forduplicate expenditures incurred in our UK operations related to the transitionand consolidation of certain administrative functions. These duplicateexpenditures are included in selling, general and administrative expenses inthe accompanying statement of operations.

The following table setsforth the activity associated with the Company’s liabilities for these costreduction programs.

| ** **                               | ** ** | **Severance**   | ** ** | ** **     | ** ** | ** ** | ** ** |
|------------------------------------------|------------|-----------------|------------|----------------|------------|------------|------------|
| ** **                               | ** ** | **and**         | ** ** | ** **     | ** ** | ** ** | ** ** |
| ** **                               | ** ** | **termination** | ** ** | **Facilities** | ** ** | ** ** | ** ** |
| ** **                               | ** ** | **benefits**    | ** ** | **related**    | ** ** | **Total**  | ** ** |
| Balance as of  January 1, 2005      |       |            | $          | —         |       |       |       | $ | — |   |   | $ | — |   |
| Accruals charged to  earnings by segment |       |            |       |           |       |       |       |   |   |   |   |
| North American Lab                       |       |            | 5.7        |           |       |       | 0.1        |   |   | 5.8 |   |
| European Lab                             |       |            | 11.2       |           |       |       | 2.6        |   |   | 13.8 |   |
| Science Education                        |       |            | 1.0        |           |       |       | —     |   |   | 1.0 |   |
| Cash payments/other                      |       |            | (8.1       | )              |       |       | (2.4       | ) |   | (10.5 | ) |
| Balance as of December 31, 2005     |       |            | $          | 9.8            |       |       |       | $ | 0.3 |   |   | $ | 10.1 |   |

 

At December 31, 2005, $16.6 of our aggregaterestructuring liabilities are included in accrued expenses and $6.7 areincluded in other long-term liabilities. At December 31, 2004, ouraggregate restructuring liabilities of $21.8 were included in accrued expenses.

57

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

**(5)   Business Combinations and Acquisitions**

***(a)   Acquisition of VWR International Corporationby CDRVA***

On February 15, 2004, Merck KGaA and CDRVAentered into a Stock Purchase Agreement, which was consummated on April 7,2004. The Acquisition was accounted for under the purchase method of accountingin accordance with SFAS No. 141, *Business Combinations.*Underpurchase accounting, tangible and identifiable intangible assets acquired andliabilities assumed have been recorded at their respective fair values based onthird party valuations. The purchase accounting adjustments made in the accompanyingfinancial statements as of and for the year ended December 31, 2004 werepreliminary and finalized during 2005.

The excess investment madeby CDRVA over the estimates of the fair market value of the identifiable assetsand liabilities of VWR as of April 7, 2004 was approximately $859.6 and issummarized below.

| Purchase price                |   | $      | 1,669.9 |   |
|-------------------------------|--------|--------|---------|--------|
| Estimated transaction  costs  |   | 20.5   |    |
| Net tangible assets  acquired |   | (268.8 | )       |
| Intangible assets  acquired   |   | (562.0 | )       |
| Goodwill                      |   | $      | 859.6   |   |

 

The following unaudited pro-formafinancial information presents a summary of consolidated results of operationsof the Company for the periods presented as if the Acquisition and the issuanceof the Senior Discount Notes discussed in Note 11(c) had occurred as of January 1,2003.

| ** **                  | ** ** | **Year Ended December 31,**                           | ** ** |
|-----------------------------|------------|----------------------------------------------------------------------|------------|
| ** **                  | ** ** | **     2004     ** | ** ** | **     2003     ** | ** ** |
| Net sales                   |       |                                                                 | $          | 3,005.4 |   |   |   | $ | 2,794.2 |   |   |
| Income before income  taxes |       |                                                                 | 47.2       |   |   |   | 30.6 |   |   |
| Net income                  |       |                                                                 | 24.7       |   |   |   | 15.2 |   |   |

 

Theseunaudited pro-forma results have been prepared for comparative purposes onlyand primarily include adjustments for a consulting advisory fee, interestexpense, depreciation, amortization and income taxes. These results do notpurport to be indicative of the results of operations which actually would haveresulted had the Acquisition occurred at the beginning of 2003, or of thefuture results of operations of the successor Company.

***(b)******          Successor’s Acquisitions of AGB ScientificLtd., Advanced Instruments Sales & Services, Inc., TechnicalService Lab B.V., and Science Education Business***

On April 1, 2005, theCompany acquired AGB Scientific Ltd. (“AGB”) for initial cash consideration ofapproximately $23.8. AGB distributes scientific supplies and is headquarteredin Dublin, Ireland. The results of AGB have been included in the European Labsegment from the date of acquisition.

On April 1, 2005, theCompany acquired Advanced Instruments Sales & Services, Inc. (“AI”)for cash consideration of approximately $16.8 and common stock of approximately$0.5. AI performs services and 

58

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

distributesscientific supplies to the Puerto Rican market and is headquartered in SanJuan, Puerto Rico. The results of AI have been included in the North AmericanLab segment from the date of acquisition.

On July 1, 2005, theCompany acquired Technical Service Lab B.V. (“TSL”) for cash consideration ofapproximately $3.1. TSL performs technical services on laboratory equipment inthe Netherlands, Germany, Belgium and France. The results of TSL have beenincluded in the European Lab segment from the date of acquisition.

Theexcess investment made by the Company over the estimates of the fair marketvalue of the identifiable assets and liabilities for the three acquisitionsdiscussed above and one other minor acquisition was $23.3 and is summarizedbelow.

| Purchase price,  including $0.5 of common stock |   | $     | 45.0   |   |
|-------------------------------------------------|--------|-------|--------|--------|
| Transaction costs                               |   | 1.5   |   |
| Net tangible assets  acquired                   |   | (9.3  | )      |
| Intangible assets  acquired                     |   | (13.9 | )      |
| Goodwill                                        |   | $     | 23.3   |   |

 

Had these acquisitionsoccurred at the beginning of 2004, the pro-forma consolidated statements ofoperations would not have been materially different from the amounts reported.

On June 1, 2004, ourScience Education segment acquired certain assets of a business that focuses onproviding math kits and supplies primarily to the publisher textbook market forapproximately $2.7.

Cash consideration forthese acquisitions was funded from cash and cash equivalents on hand.

***(c)***   Predecessor’s Acquisition of VWRSP in1995 and 1999

The Company’s NorthAmerican business was formerly VWRSP. In 1995, Merck KGaA, agreed to acquireapproximately 49.9% of the then outstanding shares of VWRSP. In July 1999,affiliates of Merck KGaA acquired through a public tender offer the remaining50.1% of the issued and outstanding common shares of VWRSP for $584.0 toincrease its beneficial ownership to 100%. The total cumulative purchase pricepaid by Merck KGaA for the 100% ownership was $792.0.

The 1999 acquisition hasbeen accounted for under the purchase method in the financial statementsfollowing the push down basis of accounting through April 7, 2004. Afterrecording the purchase price in the VWR statements, VWR had recorded $778.8 ofgoodwill, $17.5 of intangible assets, and $773.3 of push down debt in additionto recording other assets and liabilities at their fair values.

Interest expense wasrecorded on pushdown debt based upon Merck KGaA’s intercompany interest rates,which were not necessarily indicative of rates VWR International Corporationwould have obtained if it were not an ultimate subsidiary of Merck KGaA.Interest expense, including tax effects, on pushdown debt, has been included inthe statements of operations and presented as a non-cash item in theaccompanying statements of cash flows and a capital contribution in thestatement of stockholders’ equity, as this interest was not required to be paidto Merck KGaA.

59

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(d)***   Goodwilland Other Intangible Assets

Thefollowing table provides a summary of goodwill established as of theAcquisition and a roll forward of goodwill to December 31, 2005 asreflected in the accompanying consolidated balance sheets.

| ** **                                                                   | ** ** | **North**             | ** ** | **European** | ** ** | **Science**   | ** ** | ** ** | ** ** |
|------------------------------------------------------------------------------|------------|-----------------------|------------|--------------|------------|---------------|------------|------------|------------|
| ** **                                                                   | ** ** | **American Lab** | ** ** | **Lab**      | ** ** | **Education** | ** ** | **Total**  | ** ** |
| Balance as of  April 7, 2004 from Acquisition                           |       |                  | $          | 627.0        |       |          |       | $          | 164.3      |   |   |   | $ | 68.3 |   |   | $ | 859.6 |   |
| Changes as a result of purchase accounting adjustments  for the Acquisition  |       |                  | 4.5        |         |       |          | 8.9        |       |       |   | 0.9 |   |   | 14.3 |   |
| Currency translation changes                                                 |       |                  | 13.5       |         |       |          | 19.6       |       |       |   | — |   |   | 33.1 |   |
| Balance as of  December 31, 2004                                        |       |                  | 645.0      |         |       |          | 192.8      |       |       |   | 69.2 |   |   | 907.0 |   |
| Changes as a  result of purchase accounting adjustments for the Acquisition: |       |                  |       |         |       |          |       |       |       |   |   |   |   |   |   |
| Restructuring charges, net of tax                                            |       |                  | 1.1        |         |       |          | 19.2       |       |       |   | 0.2 |   |   | 20.5 |   |
| Curtailment of benefit plans, net of tax(1)                                  |       |                  | (12.1      | )            |       |          | —     |       |       |   | — |   |   | (12.1 | ) |
| Other adjustments, net(2)                                                    |       |                  | 0.8        |         |       |          | (4.9       | )          |       |   | (1.6 | ) |   | (5.7 | ) |
| 2005 acquisitions(3)                                                         |       |                  | 7.3        |         |       |          | 16.0       |       |       |   | — |   |   | 23.3 |   |
| Currency translation changes                                                 |       |                  | 5.2        |         |       |          | (28.1      | )          |       |   | (0.1 | ) |   | (23.0 | ) |
| Balance as of  December 31, 2005                                        |       |                  | $          | 647.3        |       |          |       | $          | 195.0      |   |   |   | $ | 67.7 |   |   | $ | 910.0 |   |

----

(1)          During the first quarterof 2005, the Company finalized its plans with regard to the curtailment ofcertain U.S. benefit plans. In accordance with EITF 95-3, the curtailmentgains of $12.1, net of tax, were recorded as reductions to goodwill. See Note13 for further information.

(2)          Other adjustments, netinclude the favorable resolution of certain pre-Acquisition tax contingenciesof $3.6 and a charge of $4.5 that represents an adjustment to deferred taxesoriginally established in North American Lab; reductions to restructuringliabilities for environmental remediation and severances (See Note 4(a)) of$4.2 as well as a reduction to retirement benefit liabilities of $0.6 inEuropean Lab; and other minor adjustments to purchase price allocation.

(3)          The Company hascompleted its purchase price allocations for the AI and AGB acquisitions thatwere acquired on April 1, 2005 and has preliminarily determined its purchaseprice allocation for its acquisition of TSL that was acquired on July 1,2005. Ultimate consideration related to the AGB acquisition is still undernegotiation and has not been finalized. Accordingly, further adjustment togoodwill may be required once these negotiations are concluded.

60

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Otherintangible assets, net for each of the reporting periods is shown in the tablebelow:

| ** **                                                                                                 | ** ** | **Weighted-Average**         | ** ** | ** **            | ** ** | ** ** | ** ** |
|------------------------------------------------------------------------------------------------------------|------------|------------------------------|------------|-----------------------|------------|------------|------------|
| ** **                                                                                                 | ** ** | **Amortization Period** | ** ** | **December 31,** | ** ** |
| ** **                                                                                                 | ** ** | **(Years)**                  | ** ** | **2005**              | ** ** | **2004**   | ** ** |
| Amortizable  intangible assets:                                                                            |       |                         |       |                  |       |       |       |   |   |
| Customer relationships in North America (net of  accumulated amortization of $13.2 and $5.5, respectively) |       |                         | 32.8       |                  |       | $          | 232.7      |   | $ | 238.2 |   |
| Customer relationships in Europe (net of accumulated  amortization of $6.3 and $3.0, respectively)         |       |                         | 20.5       |                  |       | 69.5       |       | 75.4 |   |
| Chemical supply agreements (net of accumulated  amortization of $5.2 and $2.5, respectively)               |       |                         | 10.0       |                  |       | 24.2       |       | 31.0 |   |
| Other (net of accumulated amortization of $0.4 and  $0.2, respectively)                                    |       |                         | 2.2        |                  |       | 0.8        |       | 2.4 |   |
| Total amortizable intangible assets (net of accumulated  amortization of $25.1 and $11.2, respectively)    |       |                         |       |                  |       | 327.2      |       | 347.0 |   |
| Unamortized  intangible assets:                                                                            |       |                         |       |                  |       |       |       |   |   |
| Trademarks and tradenames                                                                                  |       |                         |       |                  |       | 225.5      |       | 223.8 |   |
| Total intangible  assets, net                                                                              |       |                         |       |                  |       | $          | 552.7      |   | $ | 570.8 |   |

 

Amortizationexpense for each of the reporting periods is shown in the table below:

| ** **            | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|-----------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **            | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **            | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **            | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Amortization  expense |       |                  | $          | 14.8                         |       |   |   | $ | 10.6 |   |   |   | $ | 0.4 |   |   |   | $ | 1.0 |   |   |
|                       |            |                       |            |                              |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

Theestimated amortization expense for each of the five succeeding years andthereafter is as follows:

| Years ended  December 31: |   |   |   |
|--------------------------------|--------|--------|--------|
| 2006                           |   | $      | 15.0   |   |
| 2007                           |   | 14.3   |   |
| 2008                           |   | 14.3   |   |
| 2009                           |   | 14.3   |   |
| 2010                           |   | 14.3   |   |
| Thereafter                     |   | 255.0  |   |
|                           |   | $      | 327.2  |   |

 

**(6)   Investments**

TheCompany has a 24% equity investment in an independent distribution company. Thecarrying amount of the Company’s 24% investment (accounted for under the equitymethod) was $7.4 and $8.3 as 

61

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

of December 31, 2005 and December 31, 2004, respectively.Equity income, included in other (income) expense, net for each of thereporting periods is shown in the table below:

| ** **    | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|---------------|------------|-----------------------|------------|------------------------------|------------|
| ** **    | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **    | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **    | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Equity income |       |                  | $          | 0.5                          |       |   |   | $ | 0.4 |   |   |   | $ | 0.1 |   |   |   | $ | 0.6 |   |   |
|               |            |                       |            |                              |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

The Company believes thatits equity investment does not qualify as a variable interest entity, asdefined in December 2003 by the FASB with its issuance of revised InterpretationNo. 46, *Consolidation of VariableInterest Entities.*

**(7)   FairValue of Financial Instruments**

The Company’s financialinstruments consist primarily of cash and cash equivalents held at financialinstitutions, accounts receivables, accounts payable, short- and long-termdebt, foreign currency forward contracts and an interest rate cap.

The carrying amounts forcash and cash equivalents, accounts receivables, accounts payable andshort-term debt approximate fair value due to the short-term nature of theseinstruments.

The table below shows thecarrying amounts and estimated fair values of our fixed rate long-term notedebt instruments. The fair values of these instruments were estimated based onquotes from a bond trader making a market in these debt instruments.

| ** **                                   | ** ** | **December 31, 2005** | ** ** | **December 31, 2004** | ** ** |
|----------------------------------------------|------------|----------------------------|------------|----------------------------|------------|
| ** **                                   | ** ** | **Carrying**               | ** ** | **Fair**                   | ** ** | **Carrying** | ** ** | **Fair** | ** ** |
| ** **                                   | ** ** | **Amount**                 | ** ** | **Value**                  | ** ** | **Amount** | ** ** | **Value** | ** ** |
| Unsecured Senior  Notes—67¤8%      |       | $200.0                     |       | $198.5                     |       | $200.0 |   | $209.0 |   |
| Unsecured Senior  Subordinated Notes—8% |       | 320.0                      |       | 318.4                      |       | 320.0 |   | 328.0 |   |
| Senior Discount  Notes–95¤8%       |       | 330.2                      |       | 294.6                      |       | 300.6 |   | 298.8 |   |
|                                         |       | $850.2                     |       | $811.5                     |       | $820.6 |   | $835.8 |   |

 

The tables below show our outstanding foreign currencyforward contracts, fair value of the outstanding contracts and pre-tax lossfrom settled contracts included in cost of goods sold for each of the reportingperiods. The fair value of the foreign currency forward contracts was estimatedbased on period-end spot rates.

| ** **                              | ** ** | **December 31,** | ** ** |
|-----------------------------------------|------------|-----------------------|------------|
| ** **                              | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Outstanding contracts  (notional value) |       | $                     | 47.0       |   | $ | 42.1 |   |
| Fair value of contracts                 |       | (0.7                  | )          | (1.4 | ) |
|                                         |            |                       |            |  |  |  |  |

 

| ** **  | ** ** | **Successor**         | ** ** | **Predecessor**         | ** ** |
|-------------|------------|-----------------------|------------|-------------------------|------------|
| ** **  | ** ** | **Year Ended**   | ** ** | **April 7 -** | ** ** | **January 1 -** | ** ** | **Year Ended** | ** ** |
| ** **  | ** ** | **December 31,** | ** ** | **December 31,**   | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **  | ** ** | **2005**              | ** ** | **2004**                | ** ** | **2004** | ** ** | **2003** | ** ** |
| Pretax loss |       |                  | $          | (1.5                    | )          |   |   | $ | (0.4 | ) |   |   | $ | (0.1 | ) |   |   | $ | (0.7 | ) |   |
|             |            |                       |            |                         |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

 

 

62

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

 

The fair value of the Company’s interest rate cap isnot material.

The Company’s financialinstruments are spread across a number of financial institutions whose creditratings we monitor and believe do not currently carry any risk ofnon-performance. None of the off-balance-sheet financial instruments wouldresult in a significant loss to CDRV and its subsidiaries if the other partyfailed to perform according to the terms of its agreement, as any such losswould generally be limited to the extent of unrealized gain on any contract.

**(8)**   Inventories

Inventoriesconsist of purchased goods for sale and are valued at the lower of cost ormarket. The table below shows the percentage determined using the LIFO methodand amount that LIFO cost is greater or (less) than current cost for eachperiod.

| ** **                                    | ** ** | **December 31,** | ** ** |
|-----------------------------------------------|------------|-----------------------|------------|
| ** **                                    | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Percent using  LIFO method                    |       | 61                    | %          | 62 | % |
| Amount (less than)  greater than current cost |       | $                     | (1.4       | ) | $ | 0.1 |   |
|                                               |            |                       |            |  |  |  |  |

 

The cost of the remaininginventories is determined using the average cost or FIFO methods.

**(9)**   Propertyand Equipment

Propertyand equipment, net, for each of the reporting periods is shown in the tablebelow:

| ** **                       | ** ** | **December 31,** | ** ** |
|----------------------------------|------------|-----------------------|------------|
| ** **                       | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Land                             |       | $                     | 13.0       |   | $ | 12.6 |   |
| Buildings and  improvements      |       | 78.3                  |       | 68.5 |   |
| Equipment and  computer software |       | 94.4                  |       | 83.6 |   |
| Capital additions  in process    |       | 6.0                   |       | 4.9 |   |
|                             |       | 191.7                 |       | 169.6 |   |
| Less accumulated  depreciation   |       | (34.9                 | )          | (15.2 | ) |
| Net property and  equipment      |       | $                     | 156.8      |   | $ | 154.4 |   |

 

Depreciationexpense for each of the reporting periods is shown in the table below:

| ** **            | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|-----------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **            | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **            | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **            | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Depreciation  expense |       |                  | $          | 19.1                         |       |   |   | $ | 15.2 |   |   |   | $ | 8.5 |   |   |   | $ | 31.9 |   |   |
|                       |            |                       |            |                              |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

63

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

**(10)**   AccruedExpenses

Thecomponents of accrued expenses for each of the reporting periods is shown inthe table below:

| ** **                              | ** ** | **December 31,** | ** ** |
|-----------------------------------------|------------|-----------------------|------------|
| ** **                              | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Other accrued  expenses                 |       | $                     | 46.4       |   | $ | 43.6 |   |
| Employee-related  accruals              |       | 33.3                  |       | 48.0 |   |
| Restructuring-related  accruals         |       | 16.6                  |       | 21.8 |   |
| Accrued interest                        |       | 14.9                  |       | 13.5 |   |
| Income taxes  payable                   |       | 11.5                  |       | 11.0 |   |
| Current portion  of pension liabilities |       | 10.1                  |       | — |   |
| Deferred income  taxes                  |       | 6.3                   |       | 13.8 |   |
|                                    |       | $                     | 139.1      |   | $ | 151.7 |   |

 

**(11)**   Debt

Thefollowing is a summary of our debt obligations:

| ** **                                       | ** ** | **December 31,** | ** ** |
|--------------------------------------------------|------------|-----------------------|------------|
| ** **                                       | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Senior Secured  Credit Facility                  |       | $                     | 537.1      |   | $ | 559.5 |   |
| 67¤8%  Unsecured Senior Notes due 2012      |       | 200.0                 |       | 200.0 |   |
| 8% Unsecured  Senior Subordinated Notes due 2014 |       | 320.0                 |       | 320.0 |   |
| 95¤8%  Senior Discount Notes due 2015       |       | 330.2                 |       | 300.6 |   |
| Bank loans                                       |       | 0.3                   |       | 11.9 |   |
| Capital leases                                   |       | 5.8                   |       | 7.1 |   |
| Total debt                                       |       | 1,393.4               |       | 1,399.1 |   |
| Less short-term  portion                         |       | (45.5                 | )          | (12.9 | ) |
| Total long  term-portion                         |       | $                     | 1,347.9    |   | $ | 1,386.2 |   |

 

Thefollowing table summarizes the maturities of our debt obligations as of December 31,2005:

| ** **                                                  | ** ** | **2006** | ** ** | **2007** | ** ** | **2008** | ** ** | **2009** | ** ** | **2010** | ** ** | **Thereafter** | ** ** | **Total** | ** ** |
|-------------------------------------------------------------|------------|----------|------------|----------|------------|----------|------------|----------|------------|----------|------------|----------------|------------|-----------|------------|
| Senior Secured  Credit Facility                             |       | $        | 44.4       |     | $          | 5.0      |       | $        | 5.0        |     | $          | 5.0            |       | $         | 241.8      |   |   | $ | 235.9 |   |   | $ | 537.1 |   |
| 67¤8  Unsecured Senior Notes due 2012                  |       | —   |       | —   |       | —   |       | —   |       | —   |       |           | 200.0      |      |       | 200.0 |   |
| 8% Unsecured Senior  Subordinated Notes due 2014       |       | —   |       | —   |       | —   |       | —   |       | —   |       |           | 320.0      |      |       | 320.0 |   |
| 95¤8%  Senior Discount Notes due 2015 (accreted value) |       | —   |       | —   |       | —   |       | —   |       | —   |       |           | 481.0      |      |       | 481.0 |   |
| Bank loans                                                  |       | 0.3      |       | —   |       | —   |       | —   |       | —   |       |           | —     |      |       | 0.3 |   |
| Capital leases                                              |       | 0.8      |       | 0.8      |       | 0.6      |       | 0.7      |       | 0.6      |       |           | 2.3        |      |       | 5.8 |   |
| Total                                                       |       | $        | 45.5       |     | $          | 5.8      |       | $        | 5.6        |     | $          | 5.7            |       | $         | 242.4      |   |   | $ | 1,239.2 |   |   | $ | 1,544.2 |   |

 

64

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(a) Senior SecuredCredit Facility***

The Senior Secured CreditFacility provides for aggregate maximum borrowings of approximately $687.1under (1) a term loan facility providing for a loan denominated in Eurosin an aggregate principal amount currently outstanding at €132.7million (or approximately $157.2 and $179.6 on a U.S. dollar equivalent basisas of December 31,2005 and December 31, 2004, respectively), (2) a term loan facilityproviding for a term loan denominated in U.S. dollars in an aggregate principalamount currently outstanding at $379.9, and (3) a multi-currency revolvingcredit facility, providing for up to $150.0 in multi-currency revolving loans(including standby and commercial letters of credit) outstanding at any time.Undrawn amounts under the multi-currency revolving credit facility areavailable on a revolving credit basis for general corporate purposes. As of December 31,2005, we had $11.6 of undrawn letters of credit and our remaining borrowingavailability under the $150.0 multi-currency revolving credit facility was$138.4.

The term loan facilitieswill mature in 2011 and the multi-currency revolving credit facility willmature in 2009. The principal amount of the term loans are amortized in annualinstallments for the first six years and quarterly installments during theseventh year, subject to adjustment if VWR makes optional or mandatoryprepayments on the term loans.

Subjectto certain exceptions, the Senior Secured Credit Facility is subject tomandatory prepayment and reduction in an amount equal to:

·       Thenet proceeds of (1) any permitted receivables securitization program, (2) certaindebt offerings, (3) certain asset sales and (4) certain insurancerecovery and condemnation events; and

·       50%of VWR’s excess cash flow (as defined) for any fiscal year unless certainleverage ratio targets are met. A payment of $44.4 is due in March 2006based on VWR’s excess cash flow (as defined) generated in 2005. This amount hasbeen included in short-term bank debt in our consolidated balance sheet at December 31,2005.

***Security;Guarantees***

The obligations under theSenior Secured Credit Facility are guaranteed by VWR’s parent, CDRV Holdings, Inc.,and each significant direct and indirect domestic subsidiary of VWR, as thatterm is defined in the credit agreement. As of December 31, 2005, none ofthe domestic subsidiaries of VWR met the definition of significant under thecredit agreement. In addition, the Senior Secured Credit Facility and theguarantees thereunder are secured by security interests in and pledges of orliens on substantially all of the tangible and intangible assets of VWR and itssubsidiaries.

The Senior Secured CreditFacility and the guarantees thereunder are also secured by a pledge of 65% ofthe capital stock of the foreign subsidiary holding companies of CDRV Holdings, Inc.and VWR, which in turn hold the capital stock of certain of our foreignsubsidiaries.

***Interest***

At our election, theinterest rates applicable to the U.S. dollar-denominated term loan can be basedon a fluctuating rate of interest measured by reference to either (1) anadjusted London inter-bank offered rate, or LIBOR, plus a borrowing margin or (2) analternate base rate, or ABR, plus a borrowing margin. The interest rateapplicable to the Euro-denominated term loan is based on a fluctuating rate ofinterest measured by reference to an adjusted EURIBOR plus a borrowing margin.As of December 31, 2005, the 

65

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

interestrates on the U.S. dollar-denominated and Euro-denominated term loans were 6.69%and 4.94%, respectively.

Effective July 21,2004, VWR entered into an interest rate cap to hedge a portion of thevariability of cash flows related to potential changes in interest rates on €35.0million of our Euro-denominated term loan. The instrument has a 5.0% 3-monthEURIBOR cap that terminates on July 21, 2006. The 3-month EURIBORrate was approximately 2.5% as of December 31, 2005.

***Covenants***

The Senior Secured CreditFacility contains a number of covenants that, among other things, limit orrestrict our ability to dispose of assets, incur additional indebtedness, incurguarantee obligations, prepay other indebtedness, make acquisitions, modifyterms of the indentures, engage in mergers or consolidations, change thebusiness conducted by us taken as a whole, make capital expenditures, or engagein certain transactions with affiliates. In addition, the Senior Secured Creditfacility requires VWR to comply with specified financial ratios and tests,including a minimum interest expense coverage ratio, a maximum leverage ratioand a maximum capital expenditures test. As of December 31, 2005, VWR wasin compliance with all covenants.

***(b) VWR Notes***

The 67¤8%Unsecured Senior Notes mature on April 15, 2012. The 8% Unsecured SeniorSubordinated Notes mature on April 15, 2014. The VWR Notes requiresemiannual cash interest payments on April 15 and October 15 toholders of record at the close of business as of the preceding April 1 andOctober 1. The senior subordinated notes are subordinated in right ofpayment to all secured debt of the Company and the senior notes.

Under the indentures forthe VWR Notes, additional securities may be issued in one or more series fromtime to time, subject to certain covenant limitations.

***(c) Senior DiscountNotes***

On December 16, 2004,CDRV issued $481.0 aggregate principal amount at maturity ($299.4 grossproceeds) of Senior Discount Notes. The proceeds, net of $1.5 of debt issuancecosts, were used to pay a cash dividend to holders of our common stock inDecember 2004. The notes are senior unsecured obligations of the Companyand are structurally subordinated to all obligations and other liabilities ofthe Company’s existing and future subsidiaries.

No cash interest willaccrue on the Senior Discount Notes prior to January 1, 2010. Thereafter,cash interest will accrue on the notes and be payable semiannually in arrearson January 1, and July 1 of each year, commencing on July 1,2010, at the rate of 95¤8%per annum, provided that on any interest payment date, interest will be payableonly to the extent funds are available for distribution by our subsidiaries tous (net of applicable taxes and expenses) under specified provisions of theindentures governing the VWR Notes and applicable law. VWR does not guaranteethe obligations under the Senior Discount Notes.

The indenture for theSenior Discount Notes contains covenants that, among other things, limits theamount of additional indebtedness we may incur, pay cash dividends, sell assetsand subsidiary stock, enter into transactions with affiliates, place liens onassets, and make certain other payments. At December 31, 2005, the Companywas in compliance with all covenants.

66

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements  (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(d) Bank Loans***

Bank loans consist ofamounts owed by certain European subsidiaries that are operating with andwithout formal agreements with foreign banks to fund short-term needs. The bankloans had an average interest rate of 5.4% and 2.8% as of December 31,2005 and December 31, 2004, respectively. This debt was assumed inconnection with the Acquisition. The Company had no financial covenants relatedto bank loans as of December 31, 2005.

***(e) Interest on Push Down Debt***

The push down debtreflected the debt incurred by Merck KGaA as a result of its acquisition ofVWRSP. The push down debt was classified as long-term because Merck KGaA hadrepresented it would not require payment on the debt before 12 months. Theaverage interest rate on the push down debt was 2.0% for the period January 1,2004 to April 6, 2004 and for the year ended December 31, 2003. Thisinterest rate reflects the rate charged by Merck KGaA related to intercompanyborrowing. This debt was extinguished in connection with the Acquisition.

***(f) Interest on Loans from Merck KGaA and Affiliates***

Prior to the Acquisition,VWR International Corporation had various loans with Merck KGaA and itsaffiliates. Interest expense and average interest rate on these loans was $1.4and 2.6% for the period January 1, 2004 to April 6, 2004 and $8.3 and2.8% for the year ended December 31, 2003. This debt was extinguished inconnection with the Acquisition.

**(12)**   IncomeTaxes

Taxeson income before cumulative effect of a change in accounting principle arebased on income before income taxes as follows:

| ** **    | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|---------------|------------|-----------------------|------------|------------------------------|------------|
| ** **    | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **    | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **    | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| United States |       |                  | $          | 2.3                          |       |   |   | $ | 25.4 |   |   |   | $ | 20.0 |   |   |   | $ | 65.4 |   |   |
| Foreign       |       |                  | 40.6       |                         |       |   | 28.7 |   |   |   | 15.8 |   |   |   | 45.9 |   |   |
| Total         |       |                  | $          | 42.9                         |       |   |   | $ | 54.1 |   |   |   | $ | 35.8 |   |   |   | $ | 111.3 |   |   |

 

67

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements  (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Theprovision for income taxes is as follows:

| ** **                              | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|-----------------------------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **                              | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **                              | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                              | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Current:                                |       |                  |       |                         |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                                 |       |                  | $          | (2.6                         | )          |   |   | $ | 4.1 |   |   |   | $ | 10.1 |   |   |   | $ | 18.3 |   |   |
| State                                   |       |                  | 0.6        |                         |       |   | 1.6 |   |   |   | 0.5 |   |   |   | 2.5 |   |   |
| Foreign                                 |       |                  | 21.2       |                         |       |   | 14.3 |   |   |   | 5.2 |   |   |   | 17.5 |   |   |
|                                    |       |                  | 19.2       |                         |       |   | 20.0 |   |   |   | 15.8 |   |   |   | 38.3 |   |   |
| Deferred:                               |       |                  |       |                         |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                                 |       |                  | 7.4        |                         |       |   | 4.5 |   |   |   | 0.3 |   |   |   | 8.1 |   |   |
| State                                   |       |                  | 2.6        |                         |       |   | 0.2 |   |   |   | — |   |   |   | 2.9 |   |   |
| Foreign                                 |       |                  | (8.3       | )                            |       |   | (1.7 | ) |   |   | 0.6 |   |   |   | 3.0 |   |   |
|                                    |       |                  | 1.7        |                         |       |   | 3.0 |   |   |   | 0.9 |   |   |   | 14.0 |   |   |
| Tax benefit on  push down debt interest |       |                  | —     |                         |       |   | — |   |   |   | (1.6 | ) |   |   | (6.1 | ) |   |
| Total tax  provision                    |       |                  | $          | 20.9                         |       |   |   | $ | 23.0 |   |   |   | $ | 15.1 |   |   |   | $ | 46.2 |   |   |

 

The tax benefit on push down debt interest is anon-cash benefit, which is recorded in the statements of stockholders’ equity.

Thereconciliation of tax computed at the U.S. federal statutory tax rate of 35% onincome before income taxes and cumulative effect of a change in accountingprinciple to the actual income tax provision is as follows:

| ** **                                     | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|------------------------------------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **                                     | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **                                     | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                     | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Statutory tax  expense                         |       |                  | $          | 15.0                         |       |   |   | $ | 18.9 |   |   |   | $ | 12.6 |   |   |   | $ | 39.0 |   |   |
| State income  taxes net of federal tax benefit |       |                  | 2.0        |                         |       |   | 1.1 |   |   |   | 0.1 |   |   |   | 2.7 |   |   |
| Foreign rate  differential                     |       |                  | (0.8       | )                            |       |   | (1.9 | ) |   |   | — |   |   |   | (1.5 | ) |   |
| Nondeductible  expenses                        |       |                  | 1.0        |                         |       |   | 2.2 |   |   |   | 0.4 |   |   |   | 1.6 |   |   |
| Change in  valuation allowance                 |       |                  | 2.7        |                         |       |   | 2.8 |   |   |   | 2.2 |   |   |   | 3.1 |   |   |
| Other, net                                     |       |                  | 1.0        |                         |       |   | (0.1 | ) |   |   | (0.2 | ) |   |   | 1.3 |   |   |
| Total tax provision                            |       |                  | $          | 20.9                         |       |   |   | $ | 23.0 |   |   |   | $ | 15.1 |   |   |   | $ | 46.2 |   |   |

 

68

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements  (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Deferredtax liabilities and assets are comprised of the following:

| ** **                                                   | ** ** | **December 31,** | ** ** |
|--------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                   | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Deferred tax  liabilities:                                   |       |                  |       |   |   |
| Depreciation                                                 |       | $                     | 14.1       |   | $ | 13.2 |   |
| Goodwill amortization                                        |       | 20.8                  |       | 6.0 |   |
| Intangibles                                                  |       | 207.3                 |       | 217.5 |   |
| Inventory valuation                                          |       | 18.6                  |       | 13.6 |   |
| Tax-exempt reserves                                          |       | —                |       | 2.9 |   |
| Total deferred tax liabilities                               |       | 260.8                 |       | 253.2 |   |
| Deferred tax assets:                                         |       |                  |       |   |   |
| Pensions                                                     |       | 25.0                  |       | 26.6 |   |
| Other compensation benefits                                  |       | 5.1                   |       | 5.0 |   |
| Net operating loss carryforwards                             |       | 24.9                  |       | 16.0 |   |
| Foreign tax credit and alternative minimum tax carryforwards |       | 3.7                   |       | 3.5 |   |
| Inventory overhead capitalization                            |       | 3.0                   |       | 1.5 |   |
| Accrued expenses                                             |       | 5.5                   |       | 7.9 |   |
| Receivables                                                  |       | 1.9                   |       | 1.9 |   |
| Other, net                                                   |       | 0.5                   |       | 0.8 |   |
|                                                         |       | 69.6                  |       | 63.2 |   |
| Valuation allowances                                         |       | (21.8                 | )          | (21.6 | ) |
| Total deferred tax assets, net of valuation  allowances      |       | 47.8                  |       | 41.6 |   |
| Net deferred tax  liabilities                                |       | $                     | 213.0      |   | $ | 211.6 |   |

 

Deferredincome taxes have been classified in the consolidated balance sheets asfollows:

| ** **                                                          | ** ** | **December 31,** | ** ** |
|---------------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                          | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Deferred tax  asset—current (incuded in other current assets)  |       | $                     | (18.1      | ) | $ | (8.9 | ) |
| Deferred tax  asset—noncurrent                                 |       | (8.7                  | )          | (34.4 | ) |
| Deferred tax  liability—current (included in accrued expenses) |       | 6.3                   |       | 13.8 |   |
| Deferred tax  liability—noncurrent                             |       | 233.5                 |       | 241.1 |   |
| Net deferred tax  liability                                         |       | $                     | 213.0      |   | $ | 211.6 |   |

 

The Company evaluates the realizability of deferredtax assets taking into consideration such factors as the future reversals ofexisting taxable temporary differences, projected future operating results, theavailable carryforward period, and other circumstances. Valuation allowanceshave been recorded for deferred tax assets related to foreign net operatingloss carryforwards, foreign tax credit carryforwards and other deferred taxassets that are not expected to be realized. As of December 31, 2005, theCompany had valuation allowances of $13.9 related to pre-Acquisition foreignoperating losses and tax credit carryforwards. Should such losses ultimately berecovered, the resultant reduction in the valuation allowance will be recordedas a reduction to goodwill. Management has reviewed both positive and 

69

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements  (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

negative evidence relatedto the remaining deferred tax assets, including federal consolidated netoperating losses, and believes it is more likely than not that the Company willrealize these benefits, net of the existing valuation allowances.

Neither income taxes nor foreign withholding taxeshave been provided on approximately $82.7 of cumulative undistributed earningsof foreign subsidiaries at December 31, 2005. These earnings areconsidered permanently invested in the business and, under the tax laws, arenot subject to such taxes until distributed.

As of December 31, 2005, the Company has afederal net operating loss carryforward of $7.5 that begins to expire in 2025and U.S. state net operating loss carryforwards of approximately $18.0 thatexpire at various times through 2025. In addition, the Company has foreign netoperating loss carryforwards of approximately $64.0, $7.0 that begin to expire in2013 and another $57.0 that have indefinite expirations. As of December 31,2005, foreign tax credit and alternative minimum tax carryforwards of $3.7 thatwill expire at various times through 2015.

On October 22, 2004, the American Jobs CreationAct (the “AJCA”) was signed into law. The AJCA contains certain tax provisionsthat may impact us over the next several years as those provisions becomeeffective. We reviewed these provisions and their application to some of ourbusinesses to evaluate the effect these changes may have on income taxesincluded in our consolidated financial statements. Specifically, the AJCAprovides for exclusion for U.S. federal income tax purposes of 85% of certainforeign earnings that are repatriated as dividends, as defined in the AJCA. Asa result of our review, we elected not to repatriate any unremitted foreignearnings.

The Company files aconsolidated federal and certain state combined income tax returns with ourdomestic subsidiaries. Based on provisions of the Company’s tax sharingagreement and the bank credit agreement of VWR, CDRV may receive from itssubsidiaries the lower of the current tax liability of VWR or the current taxliability as reflected on the CDRV consolidated or combined federal or state taxreturns. No payments were received from affiliates during 2005 and the Companyexpects no payments will be received from subsidiaries in 2006. As of December 31,2005, the Company has a federal income tax refund receivable of approximately $3.0.

**(13)**   BenefitPrograms

The Company sponsorsvarious retirement plans for most full-time employees. During 2004, we launcheda comprehensive study of our U.S. employee benefit programs. The study wasdesigned to both benchmark our benefits from a competitive perspective andassess the balance of the program components in terms of employee needs. TheBoard of Directors approved a number of benefit changes during February 2005that were implemented effective June 1, 2005. The most significant changesinvolved the curtailment of our U.S. defined benefit plan, improvements in therate of employer matching contributions to our defined contribution plan,increased rates of employee contributions to fund ongoing medical benefits, andthe elimination of carryover vacation days by the end of 2006. These changesare expected to modestly reduce our benefit costs, prospectively.

70

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(a) U.S. Defined Benefit Plan***

Pension plan benefits for the defined benefit plan arebased primarily on participants’ compensation and years of credited service. Ithas been the Company’s policy to fund the minimum amount required by localregulations of current and prior year service costs under its funded definedbenefit plan.

As a result of the decision to curtail the plandiscussed above, future benefits were frozen effective May 31, 2005 formost participants. Most participants will earn no further benefits under theplan after that date. As a result, there was a reduction in the plan’sprojected benefit obligation of $19.4 that was recorded as a reduction topension liabilities. Goodwill and deferred tax assets were reduced by $11.9 and$7.5, respectively.

TheCompany uses a December 31 measurement date for the plan. The change inbenefit obligation, change in plan assets, and reconciliation of funded statusof the Company’s defined benefit plan that previously covered substantially allof its U.S. employees, except for employees covered by independently operatedcollective bargaining plans, were as follows:

| ** **                                           | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                                           | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** |
| ** **                                           | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** |
| ** **                                           | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** |
| Change in benefit obligation:                        |       |                  |       |                   |       |   |   |   |   |   |   |   |   |
| Benefit obligation — beginning of period        |       |                  | $          | 151.9                  |       |   |   | $ | 134.9 |   |   |   | $ | 132.3 |   |   |
| Service cost                                         |       |                  | 4.6        |                   |       |   | 5.0 |   |   |   | 1.8 |   |   |
| Interest cost                                        |       |                  | 8.2        |                   |       |   | 5.9 |   |   |   | 2.2 |   |   |
| Actuarial loss (gain)                                |       |                  | 9.5        |                   |       |   | 8.6 |   |   |   | (0.3 | ) |   |
| Benefits paid                                        |       |                  | (4.4       | )                      |       |   | (2.5 | ) |   |   | (1.1 | ) |   |
| Curtailment                                          |       |                  | (19.4      | )                      |       |   | — |   |   |   | — |   |   |
| Benefit obligation — end of period              |       |                  | $          | 150.4                  |       |   |   | $ | 151.9 |   |   |   | $ | 134.9 |   |   |
| Change in plan  assets:                              |       |                  |       |                   |       |   |   |   |   |   |   |   |   |
| Fair value of plan assets — beginning of period |       |                  | $          | 105.1                  |       |   |   | $ | 94.7 |   |   |   | $ | 93.1 |   |   |
| Actual gain on plan assets                           |       |                  | 6.4        |                   |       |   | 6.8 |   |   |   | 2.7 |   |   |
| Company contributions                                |       |                  | —     |                   |       |   | 6.1 |   |   |   | — |   |   |
| Benefits paid                                        |       |                  | (4.4       | )                      |       |   | (2.5 | ) |   |   | (1.1 | ) |   |
| Fair value of plan assets — end of period       |       |                  | $          | 107.1                  |       |   |   | $ | 105.1 |   |   |   | $ | 94.7 |   |   |
| Reconciliation of  funded status:                    |       |                  |       |                   |       |   |   |   |   |   |   |   |   |
| Unfunded status                                      |       |                  | $          | (43.3                  | )          |   |   | $ | (46.8 | ) |   |   | $ | (40.2 | ) |   |
| Unrecognized net loss                                |       |                  | 19.0       |                   |       |   | 7.3 |   |   |   | 54.4 |   |   |
| Unrecognized prior service cost                      |       |                  | —     |                   |       |   | — |   |   |   | 0.5 |   |   |
| (Accrued) prepaid  benefit cost — end of period |       |                  | $          | (24.3                  | )          |   |   | $ | (39.5 | ) |   |   | $ | 14.7 |   |   |

 

71

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Amountsrecognized in the consolidated balance sheet were as follows:

| ** **                              | ** ** | **December 31,** | ** ** |
|-----------------------------------------|------------|-----------------------|------------|
| ** **                              | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Accrued expenses                        |       | $                     | (8.5       | ) | $ | — |   |
| Other long-term  liabilities            |       | (32.9                 | )          | (39.5 | ) |
| Accumulated other  comprehensive income |       | 17.1                  |       | — |   |
| Net amount recognized at end of year    |       | $                     | (24.3      | ) | $ | (39.5 | ) |

 

The accumulated benefit obligation was $148.5 and$129.2 at December 31, 2005 and 2004, respectively.

Netperiodic pension cost includes the following components:

| ** **                          | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|-------------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                          | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                          | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                          | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| Service cost                        |       |                  | $          | 4.6                    |       |   |   | $ | 5.0 |   |   |   | $ | 1.8 |   |   |   | $ | 5.7 |   |   |
| Interest cost                       |       |                  | 8.2        |                   |       |   | 5.9 |   |   |   | 2.2 |   |   |   | 7.4 |   |   |
| Expected return on plan  assets     |       |                  | (8.5       | )                      |       |   | (5.6 | ) |   |   | (2.5 | ) |   |   | (9.3 | ) |   |
| Amortization of prior  service cost |       |                  | —     |                   |       |   | — |   |   |   | — |   |   |   | 0.1 |   |   |
| Recognized net actuarial  loss      |       |                  | —     |                   |       |   | — |   |   |   | 0.8 |   |   |   | 1.6 |   |   |
| Net periodic pension cost           |       |                  | $          | 4.3                    |       |   |   | $ | 5.3 |   |   |   | $ | 2.3 |   |   |   | $ | 5.5 |   |   |

 

Inaddition to the net periodic cost above, the following increases in minimumliability are included in other comprehensive income:

| ** **                                                            | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|-----------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                                                            | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                                                            | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                                            | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| Increase in minimum  liability included in other comprehensive income |       |                  | $          | 17.1                   |       |   |   | $ | — |   |   |   | $ | —- |   |   |   | $ | 2.0 |   |   |
|                                                                       |            |                       |            |                        |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

The net periodic pensioncost and the projected benefit obligation were based on the followingassumptions:

| ** **                                                                                               | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|----------------------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                                                                                               | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                                                                                               | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                                                                               | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| Discount rate for  benefit obligation                                                                    |       |                  | 5.65       | %                      |       |   | 5.90 | % |   |   | 6.25 | % |   |   | 6.25 | % |   |
| Discount rate for net  periodic pension cost                                                             |       |                  | 5.90       | %                      |       |   | 6.25 | % |   |   | 6.25 | % |   |   | 6.90 | % |   |
| Expected rate of return  on plan assets for net periodic pension cost                                    |       |                  | 8.25       | %                      |       |   | 8.25 | % |   |   | 9.00 | % |   |   | 9.00 | % |   |
| Assumed annual rate of compensation increase for benefit  obligation and net periodic pension cost  |       |                  | 4.00       | %                      |       |   | 4.00 | % |   |   | 4.00 | % |   |   | 4.00 | % |   |

 

72

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

We select our discount rate by developing a portfolioof bonds available as of year end with Moody’s or Standard & Poor’sratings of “Aa” or “AA”, respectively, or better with cash flows that match theexpected benefit payment stream of the plan. The yield from this portfolio isthen used as our benchmark ceiling in setting our discount rate. AtDecember 31, 2005 the portfolio yield was 5.92% and we selected 5.65% toadjust for any differences between the terms of the bonds and the actual futurebenefit payments.

Thetable below shows the asset allocation target range and the December 31,2005 and 2004 positions for each asset class:

| ** **                 | ** ** | **Target**            | ** ** | ** **            | ** ** | ** ** | ** ** |
|----------------------------|------------|-----------------------|------------|-----------------------|------------|------------|------------|
| ** **                 | ** ** | **range at**     | ** ** | ** **            | ** ** | ** ** | ** ** |
| ** **                 | ** ** | **December 31,** | ** ** | **December 31,** | ** ** |
| ** **                 | ** ** | **2005**              | ** ** | **2005**              | ** ** | **2004**   | ** ** |
| Domestic equity  funds     |       |                  | 40%-60%    | %                     |       |       | 61         | % |   |   | 59 | % |   |
| Fixed income fund          |       |                  | 20%-30%    | %                     |       |       | 25         | % |   |   | 25 | % |   |
| International  equity fund |       |                  | 0%-10%     | %                     |       |       | 11         | % |   |   | 10 | % |   |
| Money market  funds        |       |                  | 0%-20%     | %                     |       |       | 3          | % |   |   | 6 | % |   |
|                       |       |                  |       |                  |       |       | 100        | % |   |   | 100 | % |   |

 

The principal investment objective is to obtain thehighest return (defined as income plus realized and unrealized capital gainsand losses) consistent with the long-term security of anticipated benefitpayments. This is to be achieved by (a) investing a substantial portion offund assets in equity investments; (b) investment costs and volatilitywill be limited by investing the fund’s core assets in passive or commingledfunds that participate in a range of widely diversified equity and non-equityinvestments; (c) active managers will control no more than a third of thefund’s assets; (d) in order to increase the stability of fund performancewhile maintaining expected returns, non-callable bonds, annuities or guaranteedinsurance contracts may be purchased to cover payments to retired participantswhenever the rate of return offered by such contracts significantly exceeds theaverage returns projected for other fund assets and (e) fund contributionswill be set to meet an asset funding target of 125% of the present value ofaccumulated pension benefits. The expected rate of return on plan assets wasbased on our historical returns.

The Company expects to make contributions to the planof approximately $8.5 in 2006.

Thefollowing benefit payments, which reflect expected future service, are expectedto be paid:

| 2006        |   | $    | 4.4    |   |
|-------------|--------|------|--------|--------|
| 2007        |   | 4.8  |   |
| 2008        |   | 5.2  |   |
| 2009        |   | 5.7  |   |
| 2010        |   | 6.1  |   |
| 2011 - 2015 |   | 38.5 |   |

 

73

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

 

***(b)******          Other U.S. Benefit Plans***

The Company also sponsorsdefined contribution plans and a supplemental pension plan for certain seniorofficers. In addition, certain employees are covered under union-sponsored,collectively bargained plans. Expenses under these union-sponsored plans aredetermined in accordance with negotiated labor contracts. Expenses incurredunder these plan were as follows:

| ** **                  | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|-----------------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **                  | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **                  | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                  | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Defined contribution  plans |       |                  | $          | 3.5                          |       |   |   | $ | 1.6 |   |   |   | $ | 0.6 |   |   |   | $ | 2.0 |   |   |
| Union-sponsored plans       |       |                  | 1.9        |                         |       |   | 1.3 |   |   |   | 0.4 |   |   |   | 0.9 |   |   |
| Supplemental pension plan   |       |                  | 0.3        |                         |       |   | 0.4 |   |   |   | 0.2 |   |   |   | 0.7 |   |   |

 

TheCompany provides health benefits to certain retirees and a limited number ofactive employees and their spouses. These benefit plans are unfunded. Shownbelow are the accumulated postretirement benefit obligation and the weightedaverage discount rate used in determining the accumulated postretirementbenefit obligation. The annual cost of these plans is not material.

| ** **                                                                         | ** ** | **December 31,** | ** ** |
|------------------------------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                                         | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Postretirement benefit  obligations                                                |       | $                     | 2.8        |   | $ | 2.6 |   |
| Weighted average discount  rate                                                    |       | 5.65                  | %          | 5.90 | % |
| Health care cost trend  rate assumed for next year                                 |       | 11.00                 | %          | 5.00 | % |
| Rate to which the cost  trend rate is assumed to decline (the ultimate trend rate) |       | 5.00                  | %          | 5.00 | % |
| Year that the rate reaches the ultimate trend rate                                 |       | 2013                  |       | 2013 |   |
|                                                                                    |            |                       |            |  |  |  |  |

 

Assumedhealth care cost trend rates have a significant effect on the amounts reportedfor health care plans. A one-percentage-point change in assumed health carecost trend rates would change our postretirement benefit obligation as of December 31,2005 by approximately $0.5.

***(c)******           Non-U.S. Benefit Plans***

The Company has definedbenefit pension plans at various foreign subsidiaries. Our significant Non-U.S.defined benefit plans are in Germany, the UK and France.

Our German subsidiary hasan unfunded defined benefit pension plan for current employees and retirees.Prior to the Acquisition, our UK subsidiary had employees that participated inMerck KGaA sponsored defined benefit pension plans, which were treated asmultiemployer plans. The Company’s contributions to these multiemployer planswere $0.2 for the period January 1, 2004 to April 6, 2004 and $1.9for the year ended December 31, 2003. In connection with the Acquisition,Merck KGaA agreed to deliver fully funded plans to the Company if the Companywithdrew from Merck KGaA sponsored defined benefit pension plans. Effective April 7,2004, the Company withdrew from the Merck KGaA sponsored plans and our UKsubsidiary established two defined benefit plans to provide for the benefitspreviously covered under the Merck KGaA sponsored defined benefit plans. OurFrench subsidiary has a defined benefit pension plan for a certain group ofemployees that is closed to new participants.

74

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Inaddition, the Company has several small defined benefit pension plans at otherlocations. The Company uses a December 31 measurement date for theseplans. Combined information for the German, French and the UK plans’ change inbenefit obligation, change in plan assets, and reconciliation of funded statuswere as follows:

|                                            |   | **Successor**                                | ** ** | **Predecessor**                      |       |
|-------------------------------------------------|--------|----------------------------------------------|------------|--------------------------------------|------------|
|                                            |   | **Year Ended  December 31,  2005** | ** ** | **April 7-  December31,  2004** | ** ** | **January 1-  Aptil 6,  2004** |   |
| Change in benefit  obligation:                  |   |                                         |       |                                 |       |   |   |
| Benefit obligation — beginning of period   |   | $                                            | 84.1       |                                 | $          | 25.4 |   | $ | 22.7 |   |
| Acquisition of UK plan obligation               |   | —                                       |       | 48.9                                 |       | — |   |
| Service cost                                    |   | 3.4                                          |       | 1.7                                  |       | 0.1 |   |
| Interest cost                                   |   | 4.0                                          |       | 1.0                                  |       | 0.3 |   |
| Plan participants’ contributions           |   | 0.5                                          |       | 0.3                                  |       | — |   |
| Actuarial loss                                  |   | 10.9                                         |       | 2.4                                  |       | 0.1 |   |
| Benefits paid                                   |   | (3.8                                         | )          | (1.2                                 | )          | (0.3 | ) |
| Currency translation changes                    |   | (10.2                                        | )          | 5.6                                  |       | (0.9 | ) |
| Benefit  obligation — end of period        |   | $                                            | 88.9       |                                 | $          | 84.1 |   | $ | 22.0 |   |
| Change in plan  assets:                         |   |                                         |       |                                 |       |   |   |
| Fair value of plan assets - beginning of period |   | $                                            | 55.5       |                                 | $          | 1.6 |   | $ | 1.6 |   |
| Contribution of assets for UK plan              |   | —                                       |       | 48.9                                 |       | — |   |
| Actual gain on plan assets                      |   | 9.5                                          |       | 0.9                                  |       | 0.1 |   |
| Company contributions                           |   | 2.6                                          |       | 1.9                                  |       | 0.2 |   |
| Plan participants’ contributions           |   | 0.5                                          |       | 0.3                                  |       | — |   |
| Benefits paid                                   |   | (3.0                                         | )          | (0.7                                 | )          | (0.2 | ) |
| Currency translation changes                    |   | (6.3                                         | )          | 2.6                                  |       | (0.1 | ) |
| Fair value of  plan assets — end of period |   | $                                            | 58.8       |                                 | $          | 55.5 |   | $ | 1.6 |   |
| Reconciliation of  funded status:               |   |                                         |       |                                 |       |   |   |
| Unfunded status                                 |   | $                                            | (30.1      | )                                    | $          | (28.6 | ) | $ | (20.4 | ) |
| Unrecognized net loss                           |   | 5.9                                          |       | 1.8                                  |       | — |   |
| Accrued benefit  cost — end of period      |   | $                                            | (24.2      | )                                    | $          | (26.8 | ) | $ | (20.4 | ) |

 

Amountsrecognized in the consolidated balance sheet were as follows:

| ** **                              | ** ** | **December 31,** | ** ** |
|-----------------------------------------|------------|-----------------------|------------|
| ** **                              | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Other long-term  assets                 |       | $                     | 0.2        |   | $ | 0.1 |   |
| Accrued expenses                        |       | (1.6                  | )          | — |   |
| Other long-term  liabilities            |       | (24.8                 | )          | (26.9 | ) |
| Accumulated other  comprehensive income |       | 2.0                   |       | — |   |
| Net amount  recognized at end of year   |       | $                     | (24.2      | ) | $ | (26.8 | ) |

 

75

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

The combined accumulated benefit obligation was $81.7and $74.5 at December 31, 2005 and 2004, respectively.

Combinednet periodic pension cost includes the following components:

| ** **                      | ** ** | **Successor**                                | ** ** | **Predecessor**                            | ** ** |
|---------------------------------|------------|----------------------------------------------|------------|--------------------------------------------|------------|
| ** **                      | ** ** | **Year Ended  December 31,  2005** | ** ** | **April 7**-  December 31,  2004 | ** ** | **January 1**-  April 6,  2004 | ** ** | **Year Ended  December 31,  2003** | ** ** |
| Service cost                    |       |                                         | $          | 3.4                                        |       |   |   | $ | 1.7 |   |   |   | $ | 0.1 | ** ** |   |   | $ | 0.4 |   |   |
| Interest cost                   |       |                                         | 4.0        |                                       |       |   | 1.0 |   |   |   | 0.3 | ** ** |   |   | 1.2 |   |   |
| Expected return  on plan assets |       |                                         | (3.5       | )                                          |       |   | (0.1 | ) |   |   | — | ** ** |   |   | (0.1 | ) |   |
| Recognized net  actuarial loss  |       |                                         | 0.1        |                                       |       |   | — |   |   |   | — | ** ** |   |   | 0.1 |   |   |
| Net periodic  pension cost      |       |                                         | $          | 4.0                                        |       |   |   | $ | 2.6 |   |   |   | $ | 0.4 | ** ** |   |   | $ | 1.6 |   |   |

 

Thecombined net periodic pension cost and the combined projected benefitobligation were based on the following weighted average assumptions:

| ** **                                       | ** ** | **Successor**                                | ** ** | **Predecessor**                            | ** ** |
|--------------------------------------------------|------------|----------------------------------------------|------------|--------------------------------------------|------------|
| ** **                                       | ** ** | **Year Ended  December 31,  2005** | ** ** | **April 7**-  December 31,  2005 | ** ** | **January 1**-  April 6,  2004 | ** ** | **Year Ended  December 31,  2003** | ** ** |
| Discount rate for  benefit obligation            |       |                                         | 4.56       | %                                          |       |   | 5.05 | % |   |   | 5.72 | % |   |   | 5.83 | % |   |
| Discount rate for  net periodic pension cost     |       |                                         | 5.05       | %                                          |       |   | 5.49 | % |   |   | 5.83 | % |   |   | 5.64 | % |   |
| Expected rate of return  on plan assets for net  |       |                                         |       |                                       |       |   |   |   |   |   |   |   |   |   |   |   |   |
| periodic pension cost (French and UK plans only) |       |                                         | 6.58       | %                                          |       |   | 6.49 | % |   |   | 3.50 | % |   |   | 3.00 | % |   |
| Assumed annual rate of  compensation             |       |                                         |       |                                       |       |   |   |   |   |   |   |   |   |   |   |   |   |
| increase for benefit obligation                  |       |                                         | 3.19       | %                                          |       |   | 3.36 | % |   |   | 3.00 | % |   |   | 3.00 | % |   |
| Assumed annual rate of  compensation             |       |                                         |       |                                       |       |   |   |   |   |   |   |   |   |   |   |   |   |
| increase for net  periodic pension cost          |       |                                         | 3.36       | %                                          |       |   | 3.54 | % |   |   | 3.00 | % |   |   | 2.71 | % |   |

 

The Company expects to make contributions to theFrench and UK plans of approximately $1.6 in 2006.

The table below shows thecombined asset allocation target and the combined December 31, 2005 and2004 positions for each asset class:

| ** **        | ** ** | **Target at**    | ** ** | ** **            | ** ** | ** ** | ** ** |
|-------------------|------------|-----------------------|------------|-----------------------|------------|------------|------------|
| ** **        | ** ** | **December 31,** | ** ** | **December 31,** | ** ** |
| ** **        | ** ** | ** **            | **2005**   | ** **            | ** ** | **2005**   | ** ** | **2004** | ** ** |
| Equity securities |       |                  | 67         | %                     |       | 67         | %          | 63 | % |
| Debt securities   |       |                  | 33         | %                     |       | 33         | %          | 32 | % |
| Other             |       |                  | 0          | %                     |       | 0          | %          | 5 | % |
|              |       |                  |       |                  |       | 100        | %          | 100 | % |

 

76

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Thefollowing combined benefit payments, which reflect expected future service, asappropriate, are expected to be paid:

| 2006        |   | $    | 2.2    |   |
|-------------|--------|------|--------|--------|
| 2007        |   | 2.1  |   |
| 2008        |   | 2.2  |   |
| 2009        |   | 2.3  |   |
| 2010        |   | 3.3  |   |
| 2011 - 2015 |   | 16.6 |   |

 

***(d) Other Non-U.S. Postemployment Benefits***

Certain of the Company’sEuropean subsidiaries provide post employment benefits in the form of lump-sumcash payments to employees when they leave the Company, regardless of theirreason for leaving. The Company estimates and accrues a liability for these benefits.The largest such plans are in France and Italy. The combined liability recordedfor these plans was $1.6 and $2.0 at December 31, 2005 and 2004,respectively.

**(14) Stock Incentive Plan**

In connection with the Acquisition, the Companyadopted the CDRV Investors, Inc. Stock Incentive Plan (the “Stock Plan”).Under the Stock Plan, our board of directors may grant rights to purchaseshares of our common stock and options to purchase shares of our common stockto any of our executive officers or other employees, including our namedexecutive officers. Under the Stock Plan, the board of directors may also grantshares of our common stock, rights to purchase shares of our common stock andother share-based awards to our non-employee directors. Initially, a total of1,300,000 shares of our common stock were made available for all types ofawards under the Stock Plan. However, the number of available shares wasautomatically reduced by shares covered by awards offered but not granted aspart of our initial grants following the Acquisition. Shares subject to optionsthat are forfeited, canceled or otherwise terminated will again be availablefor grant under the Stock Plan. As a result of the reduction, 909,271 shares ofour common stock are available for all types of awards under the Stock Plan.Based on shares outstanding, options outstanding and restricted units granted asof December 31, 2005, there are 150,782 shares available for futureawards.

Shares purchased by our officers and employees underthe Stock Plan may, at the Company’s discretion, be repurchased by the Companyand/or CD&R Fund VI for their fair market value upon a participant’stermination of employment prior to a public offering. All participants may alsobe required to sell their shares at the same price and on the same terms asCD&R Fund VI, if CD&R Fund VI enters into certain transactions with athird-party purchaser at any time before there is a public market for ourshares.

We have accounted forawards under the Stock Plan using the intrinsic value guidance in APB No. 25.Refer to Note 2(o) for disclosure of the pro-forma effect on net incomefor stock-based awards as if the Company had adopted the fair value recognitionprovisions of SFAS No. 123. Also, refer to Note 2(v) for further informationconcerning the Company’s accounting for stock options after December 31,2005.

77

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***Initial Offering in 2004***

Shortly after the Acquisition, we made an initialoffering of awards under the Stock Plan to certain of our officers andemployees. Such participants were offered the opportunity to purchase shares ofour common stock for a purchase price per share, which we believe was the fairmarket value of a share on the offer date and equal to the fair market value asof the acquisition date. Those employees who are not also executive officers ofours were offered financing assistance to help purchase their shares of commonstock, either through a loan facility that we arranged through a third-partyfinancial institution or, in certain limited circumstances, directly from us.As part of the offer, participants who elected to purchase a number of shareswithin the range of shares offered to them were granted options under the StockPlan to purchase two additional shares of our common stock (certain of our namedexecutive officers at that time were granted options to purchase three sharesfor each share they purchased). All options were granted with an exercise priceper share, which we believe was equal to the fair market value of our commonstock on the date of grant. The options granted will vest in equal annualinstallments on each of the first five anniversaries of the grant date, andwill expire ten years from the grant date.

As part of this initial offering, directors who arenot also our employees or associated with Clayton, Dubilier & Rice, Inc.(“CD&R”) were each offered the opportunity to purchase up to 2,500 sharesof our common stock. Such directors were not offered options.

As of December 31,2004, the Company had closed the initial offering in respect of 198 of ourofficers and employees, and 4 of our directors. In the initial offering, theseofficers, employees, and directors purchased a total of 239,835 shares andwere granted options to purchase 485,990 shares under the Stock Plan. Upon the closingof the offering, the net proceeds of approximately $23.7 were paid to theCompany, who in turn contributed the $23.7 to VWR as an additional investment.Because the option exercise price equaled the fair market value per share ofour common stock at the time of grant, no compensation expense related to thestock options is reflected in the Company’s income statement. In connectionwith the December 16, 2004 offering of the Senior Discount Notes by theCompany, the net proceeds of the offering were paid as a special dividend toour stockholders and the original exercise price of $100.00 per share for eachoption was adjusted to $50.52 per share pursuant to the antidilution provisionof the Stock Plan. As a result of the special dividend distribution, the Companyrecorded compensation expense of approximately $1.2. In addition, we issued1,382 shares to certain directors who are not also employees or associated withCD&R for directors compensation in 2004.

***Offerings in 2005***

During 2005, we offered certain of our officers andemployees the opportunity to purchase shares of our common stock for a purchaseprice equal to $56.00 per share, which we believe was the fair market value ofa share on the offer date. Those participants who are not also executive officerswere offered financing assistance to help purchase their shares through a loanfacility that we arranged through a third-party financial institution.Consistent with the initial offering in 2004, participants were granted optionsto purchase two additional shares of our common stock for each share theypurchased. The terms of these options are the same as the options granted in2004.

78

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

During 2005, the Company closed offerings in respectof 18 of our officers and employees, and 1 of our directors. These officers,employees, and director purchased a total of 23,407 shares and weregranted options to purchase 45,920 shares. Upon the closing of these offerings,the proceeds of approximately $1.3 were paid to the Company, who in turncontributed the $1.3 to VWR as an additional investment. In connection with theacquisition of AI during 2005, discussed in Note 5(b), the Company issued 8,929shares, as consideration (for value of $0.5), and granted options to purchase17,858 shares. Because the option exercise price equaled the fair market valueper share of our common stock at the time of grant, no compensation expenserelated to the stock options is reflected in the Company’s income statement. Inaddition, we issued 5,625 shares to certain directors who are not alsoemployees or associated with CD&R for directors compensation in 2005.

In November 2005, in connection with the hiringof our new President and Chief Executive Officer, the Company offered thisexecutive officer the opportunity to purchase 35,714 shares of our common stockfor a purchase price of $56.00 per share. We believe the fair market value of ashare on the offer date was $75.00 per share. As a result of this discount werecorded compensation expense of $0.7 using the intrinsic value guidance in APBNo. 25. As of December 31, 2005, this executive officer had notacquired any shares.

We recognize compensation expense for our stockoptions granted to employees, which are considered fixed awards with pro-ratavesting, on a straight-line basis.

Informationregarding our stock options granted to our employees under the Stock Plan is asfollows:

| ** **                                      | ** ** | **Year Ended  December 31, 2005** | ** ** | **April 7 –  December 31, 2004** | ** ** |
|-------------------------------------------------|------------|--------------------------------------------------|------------|-----------------------------------------------------------|------------|
| ** **                                      | ** ** | **Shares**                                       | ** ** | **Weighted  Average  Exercise  Price**                    | ** ** | **Shares** | ** ** | **Weighted  Average  Exercise  Price** | ** ** |
| Outstanding - beginning  of period              |       | 484,590                                          |       | $                                                         | 50.52      |   | — |   | $ | — |   |
| Granted                                         |       | 63,778                                           |       | 56.00                                                     |       | 485,990 |   | 50.52 |   |
| Canceled /  Forfeited                           |       | (64,640                                          | )          | 50.52                                                     |       | (1,400 | ) | — |   |
| Outstanding - end  of period                    |       | 483,728                                          |       | $                                                         | 51.24      |   | 484,590 |   | $ | 50.52 |   |
| Exercisable at  end of period                   |       | 85,398                                           |       | $                                                         | 50.52      |   | —   |   | $ | — |   |
| Weighted average fair  value of options granted |       |                                             |       | $                                                         | 25.56      |   |   |   | $ | 15.58 |   |

 

Thefollowing is a summary of our outstanding stock options as of December 31,2005.

| **Exercise  Price** | ** ** | **Number  Outstanding** | ** ** | **Weighted  Average  Remaining  Contractual  Life** | ** ** | **Number  Exercisable** | ** ** |
|---------------------|------------|-------------------------|------------|-----------------------------------------------------|------------|-------------------------|------------|
| $ 50.52        |       | 419,950                 |       | 8.8                                                 |       | 85,398                  |       |
| 56.00               |       | 63,778                  |       | 9.3                                                 |       | —        |       |
|                |       | 483,728                 |       |                                                |       | 85,398                  |       |

 

79

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***Guaranteed Loans***

In connection with theloan facility we arranged through a third-party financial institution, VWRhasguaranteed an aggregate principal amount of $2.6 and $2.9 as ofDecember 31, 2005 and 2004, respectively. VWR would become liable for suchamounts in the event that a member of management would fail to repay theprincipal and interest when due. These loans mature on November 5, 2008and bear interest at the one month LIBOR plus 2.05%. In accordance with FASBInterpretation No. 45, *Guarantor’s**Accounting and Disclosure Requirements forGuarantees, Including Indirect Guarantees of Indebtedness of Others,*the Company has determined that the obligation for the fair value of theguarantee is immaterial. We recorded compensation expense and a correspondingincrease in paid-in-capital of $0.1, for the period April 7, 2004 toDecember 31, 2004 for the favorable interest rate provided to individualswho have utilized the loan facility.

Given VWR’s guarantee ofthe loan balances, we have considered the proceeds received from the sale ofour common stock to represent an obligation that may be redeemable upon theoccurrence of an event that is not within our control in accordance withAccounting Series Release No. 268 issued by the SEC. Therefore, tothe extent the loans guaranteed by VWR are outstanding, we have presented thebalance that may become due under the guarantee outside of stockholders’equity. As loans are repaid by the employees, the amount classified outside ofstockholders’ equity is reclassed to additional paid-in capital.

***Direct Loans***

In connection with theinitial offering in 2004, the Company provided direct loans of $0.3 tonon-executive employees of the Company that were used to purchase shares. Theseloans have been shown as contra-equity in the Company’s financial statementsthereby reducing the paid-in-capital. As these loans are repaid, thecontra-equity balance is reduced and additional paid-in capital is increased.

**(15) Grantsof Restricted Stock Units**

In 2004, we granted 5,000restricted stock units to one of our executive officers that would have vestedon the seventh anniversary of his commencement of employment with the Company.The restricted units would have vested earlier in certain circumstances if theCompany underwent a public offering or if we were sold to a third partyunrelated to CD&R. The granting of these units has been reflected in the December 31,2004 financial statements by increasing additional paid-in capital by $0.3 anda contra-equity account of unamortized value of restricted stock issued of$0.3. The unearned compensation was being amortized as compensation expenseover the seven-year vesting period of the restricted units granted. As aresult of this executive’s resignation in December 2005, the compensationexpense previously recorded and the $0.3 increases to additional paid-incapital and the contra-equity account of unamortized value of restricted stockissued have been reversed in the December 31, 2005 financial statements.

In 2005, we granted 21,333restricted stock units with a total fair value of approximately $1.6 to certainof our officers and other key executives that will vest in equal annualinstallments over a five-year period. The restricted units will all vestearlier in certain circumstances if the Company undergoes a public offering orif we are sold to a third party unrelated to CD&R. The granting of theseunits has been reflected in the December 31, 2005 financial statements byincreasing additional paid-in capital by $1.6 and a contra-equity 

80

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

accountof unamortized value of restricted stock issued of $1.6. The unearnedcompensation is being amortized as compensation expense over the five-yearvesting period of the restricted units granted.

**(16) Commitmentsand Contingencies**

TheCompany leases office and warehouse space and computer equipment underoperating leases, certain of which extend up to 15 years, subject to renewaloptions. Rental expense is shown in the table below:

| ** **     | ** ** | **Successor**                                | ** ** | **Predecessor**                                       | ** ** |
|----------------|------------|----------------------------------------------|------------|-------------------------------------------------------|------------|
| ** **     | ** ** | **Year Ended  December 31,  2005** | ** ** | **April 7 –  December 31,  2004** | ** ** | **January 1 –  April 6,  2004** | ** ** | **Year Ended  December 31,  2003** | ** ** |
| Rental expense |       |                                         | $          | 33.4                                                  |       |   |   | $ | 24.9 |   |   |   | $ | 9.1 |   |   |   | $ | 29.5 |   |   |
|                |            |                                              |            |                                                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

Future minimum lease payments as of December 31,2005, under noncancelable operating leases having initial lease terms of morethan one year are as follows:

| Years ended  December 31: |   |   |   |
|--------------------------------|--------|--------|--------|
| 2006                           |   | $      | 23.8   |   |
| 2007                           |   | 19.8   |   |
| 2008                           |   | 16.4   |   |
| 2009                           |   | 12.5   |   |
| 2010                           |   | 11.0   |   |
| Thereafter                     |   | 30.7   |   |
| Total minimum payments         |   | $      | 114.2  |   |

 

The Company is involved invarious environmental, contractual and product liability cases and claims whichare considered routine to the Company’s business and from time to time theCompany is named as a defendant in cases as a result of our distribution ofscientific supplies, including litigation resulting from the distribution ofproducts containing asbestos by the Company and certain of its predecessors.While the impact of this litigation has typically been immaterial, there can beno assurance that the impact of the pending and any future claims will not bematerial to our business, financial condition or results of operations in thefuture.

During 2005, the GermanFederal Cartel Office initiated an investigation with regard to our EuropeanDistribution Agreement with Merck KGaA. The purpose of the investigation is todetermine whether this agreement violates or otherwise infringes the generalprohibition of anti-competitive agreements under either German or EU rules. TheCompany has submitted information to the German Federal Cartel Office and isawaiting feedback in connection with this matter. At the current time we cannotassess the likely outcome of the investigation or potential economic impactassociated with an adverse ruling. In connection with the Acquisition, werecorded intangible assets of approximately €24.8million (or $29.4 on a U.S. dollar equivalent basis as of December 31,2005) related to our European Distribution Agreement with Merck KGaA. As of December 31,2005, the unamortized net book value of these intangible assets isapproximately  €20.4million (or $24.2 on a U.S. dollar equivalent basis).

81

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

On March 28, 2006,the Company was served with a complaint filed in the United States DistrictCourt, Western District of New York, by a former supplier alleging a breach ofcontract and unliquidated damages. The Company will vigorously defend itself inthis matter. Until further information is obtained we cannot assess the likelyoutcome of this litigation.

**(17) Transactionswith Related Parties (Merck KGaA was a Related Party Prior to the Acquisition)**

Merck KGaA (Merck KGaAand/or affiliates) and the Company have entered into various transactions andagreements in the ordinary course of business. Prior to the entering intoagreements with Merck KGaA, the Company and Merck KGaA conducted business witheach other in a manner that was not materially different than those describedbelow. In connection with the Acquisition, the Company entered into newagreements with Merck KGaA that are described below. The following summarizessignificant transactions between the Company and Merck KGaA:

***(a) Sales to MerckKGaA***

The Company sells productsto Merck KGaA for which it is paid in the normal course of business.

***(b) Purchases fromMerck KGaA***

The Company purchasescertain chemical products for resale from Merck KGaA for which it pays MerckKGaA in the normal course of business. The Company and Merck KGaA have enteredinto two contracts that provide for the Company to be the exclusive distributorof certain Merck KGaA products in certain countries (territories) and the non-exclusivedistributor in certain other territories. These two contracts for NorthAmerican and European territories expire on April 6, 2009 and may beextended for an additional five-year term subject to the occurrence of certainconditions.

In connection with theAcquisition, we have also entered into other distribution agreements with MerckKGaA, including five-year distribution agreements with Merck KGaA to distributeits bioscience products in Europe and North America. These distributionagreements in Europe and North America are exclusive and non-exclusive,respectively. In addition, we have entered into a supply agreement with MerckKGaA, pursuant to which it has agreed to continue to manufacture certain of ourprivate label products for a period of three years from April 7, 2004, andthereafter to provide technical assistance in transitioning their manufactureto other manufacturers. These products are primarily sold in the UK, and wehave agreed to use our commercially reasonable efforts to convert theseproducts to Merck KGaA-branded products to the extent that the conversion wouldbe economically equivalent to us.

***(c) LogisticsServices in Europe***

Under the terms of anagreement that expires on December 31, 2007, Merck KGaA continues toprovide logistics services to certain of our subsidiaries. Unless earlierterminated following a notice period, such logistics service agreements will beautomatically renewed for an additional three years.

82

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

***(d) Systems/TechnologyServices***

Following the completionof the Acquisition, we and Merck KGaA have also continued to provide certaininformation technology services to each other consistent with the arrangementsin place prior to the Acquisition, including Merck KGaA’s operation and supportof the main enterprise resource planning and business warehouse software anddatabases for our European companies. The information services master agreementwill continue for an initial five-year period from April 7, 2004, althoughindividual services may be terminated during the term following a noticeperiod.

***(e) Other ServicesProvided by the Company and by Merck KGaA***

We and Merck KGaA havehistorically performed corporate services for each other, including certainfinancial and administrative functions. In order to maintain continuous andefficient operations following the completion of the Acquisition, we haveentered into a transition services agreement with Merck KGaA to maintain theserelationships following the Acquisition until such time as these services canbe obtained internally or from other sources. The term of the transitionservices agreement is three years from April 7, 2004, although therecipient of the services has in most cases, the right to terminate individualservices upon notice. Certain services may be terminated on an earlier date. Ifany required third-party consent is not obtained, we may no longer benefit fromcertain group rates available to Merck KGaA. We and Merck KGaA will alsocontinue to provide each other with certain environmental and other regulatorycompliance services for a transition period following the Acquisition.

Certain subsidiaries ofMerck KGaA and certain of our subsidiaries have continued to lease or subleasefrom one another, or otherwise share, space in various offices and warehousesin Europe and Mexico since the completion of the Acquisition. The terms ofthese leasing and subleasing arrangements range from less than one year to upto six or more years and are generally at market rents and conditions. Certainother existing intercompany contracts have also remained in place since theAcquisition and were not replaced by the transition services agreement.

The following tablesummarized the transactions between VWR International Corporation and MerckKGaA during the periods when VWR International Corporation was a wholly-ownedsubsidiary of Merck KGaA:

| ** **                                       | ** ** | **January 1 –  April 6,  2004** | ** ** | **Year Ended  December 31,  2003** | ** ** |
|--------------------------------------------------|------------|-----------------------------------------------------|------------|----------------------------------------------|------------|
| Sales to Merck  KGaA, included in net sales      |       |                                                | $          | 8.4                                          |       |   |   | $ | 29.1 |   |   |
| Purchases from  Merck KGaA, included in          |       |                                                |       |                                         |       |   |   |   |   |
| cost of goods  sold and inventory                |       |                                                | 80.7       |                                         |       |   | 261.6 |   |   |
| Services provided  by Merck KGaA, included       |       |                                                |       |                                         |       |   |   |   |   |
| in selling,  general and administrative expenses |       |                                                | 3.3        |                                         |       |   | 16.4 |   |   |
| Services provided  to Merck KGaA, included       |       |                                                |       |                                         |       |   |   |   |   |
| in selling, general and  administrative expenses |       |                                                | 1.5        |                                         |       |   | 4.4 |   |   |

 

83

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Merck KGaA continues to bea significant supplier to the Company. Purchases from Merck KGaA, included incost of goods sold and inventory, were approximately $288.7 for the year ended December 31,2005 and $204.9 for the period April 7, 2004 to December 31, 2004.

The purchases from MerckKGaA discussed above for prior periods have increased from amounts previouslyreported because prior amounts excluded costs for a gross margin sharingarrangement in North America that are now included for all reporting periods.

***(f) Transactionswith Clayton, Dubilier & Rice, Inc.***

Under the terms of aconsulting agreement between the Company and CD&R dated April 7, 2004the Company paid CD&R $18.0 for transaction services rendered in connectionwith the Acquisition. In addition, the consulting agreement includes an annualconsulting fee of $1.5 for financial advisory and management consultingservices and a provision that CD&R would be paid an additional fee of $0.5for any period CD&R provided the Company with an individual to be our ChiefExecutive Officer. In accordance with this provision we paid CD&R $0.3 in2005. The consulting agreement terminates upon the earlier of (1) April 7,2014; (2) the date on which an investment fund managed by CD&R no longerowns, directly or indirectly, any shares of common stock of the Company or itssuccessor company; or (3) upon thirty days written notice of either party.

***(g) Servicesperformed by Debevoise & Plimpton LLP***

The Company is provided legal services by the abovereferenced law firm in which one of the members of the Company’s Board ofDirectors is related to a senior member of that law firm. Total fees forservices rendered during 2005 and 2004 were approximately $0.3 and $7.4,respectively.

***(h)***                Servicesperformed by SIRVA, Inc.

The Company is provided with product transportationand relocation services by SIRVA, Inc. (“SIRVA”). Five members of theCompany’s Board of Directors are also members of SIRVA’s Board of Directors. SIRVAis a related party because certain funds managed by CD&R, includingClayton, Dubilier & Rice Fund VI Limited Partnership that ownsapproximately 73% of our outstanding common stock as of December 31, 2005,have equity interests in SIRVA. Total expenses incurred with SIRVA during 2005 and2004 were approximately $1.7 and $1.0, respectively.

**(18)   AccountsPayable**

The Company maintains a centralized cash managementsystem for certain U.S. accounts payable functions. Accordingly, included inaccounts payable at December 31, 2005 and 2004 are approximately $48.9 and$33.9, respectively, of uncleared payments.

***(19)   Segmentand Geographical Financial Information***

The Company reports financial results on the basis ofthe following three business segments: North American laboratory distribution,or North American Lab, European laboratory distribution, or European 

84

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Lab, andScience Education. Both the North American Lab and European Lab segments arecomprised of the distribution of scientific supplies to customers engaged inpharmaceutical, biotechnology, chemicals, technology, and food processing;governmental agencies; colleges and universities; and environmentalorganizations. Science Education is comprised of the distribution of scientificsupplies and specialized kits to primary and secondary schools as well asdistribution of scientific supplies to universities and research institutes.

The Company’s operating segments have been identifiedgiving consideration to both geographic areas and the nature of products amongbusinesses within its geographic area. North American Lab and European Lab areorganized as distinct operating segments primarily because of geographicdispersion and the inherent differences in business models. The North AmericanLab segment is highly standardized and operated as an integrated business,whereas the European Lab business is more fragmented and its customer marketsmore localized. The Science Education operating segment has been differentiatedfrom the North American Lab segment because of its unique and specialized productlines, concentration of customers in the educational sector and the stronggross margins. Operations within North America (excluding Science Education)have been aggregated due to the similarity of economic characteristics, productlines, customers and distribution methods. Similarly, operations within theEuropean Lab segment have been aggregated because of common economiccharacteristics as well as the similarity among products, customers anddistribution networks.

The Company allocates its centralized management ofcorporate costs to its operating segments as follows:

·       Corporatecosts are allocated to its North American Lab and Science Education operatingsegments using allocation factors that management considers reasonable todistribute costs on the basis of usage.

·       Centralizedcosts related to the management of the European Lab operating segment areincurred within the segment structure and no inter-segment allocation isrequired.

Selected business segmentfinancial information is presented below. Inter-segment activity has beeneliminated. Therefore, revenues reported for each operating segment aresubstantially all from external customers.

85

----

**CDRV INVESTORS,INC.Notes to Consolidated Financial Statements (Continued)December 31, 2005, 2004 and 2003(Dollars in millions, except share data)**
|                                    | ** ** | **Successor**         | ** **                          | **Predecessor**        | ** ** |
|------------------------------------|------------|-----------------------|-------------------------------------|------------------------|------------|
| ** **                         | ** ** | **Year Ended**   | ** **                          | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                         | ** ** | **December 31,** | ** **                          | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                         | ** ** | **2005**              | ** **                          | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| **Net Sales**                      |       |                  |                                |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                 |       |                  | $ 1,902.4                      |                   |       |   | $ 1,350.7 |   |   |   | $ 486.5 |   |   |   | $ 1,734.3 |   |   |
| European Lab                       |       |                  | 1,089.8                             |                   |       |   | 752.3 |   |   |   | 283.0 |   |   |   | 932.6 |   |   |
| Science Education                  |       |                  | 146.0                               |                   |       |   | 109.2 |   |   |   | 23.7 |   |   |   | 127.3 |   |   |
| Total                              |       |                  | $ 3,138.2                      |                   |       |   | $ 2,212.2 |   |   |   | $ 793.2 |   |   |   | $ 2,794.2 |   |   |
| **Operating  Income**              |       |                  |                                |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                 |       |                  | 91.0                                |                   |       |   | $     65.1 |   |   |   | $ 28.5 |   |   |   | $     82.8 |   |   |
| European Lab                       |       |                  | 38.1                                |                   |       |   | 24.1 |   |   |   | 13.1 |   |   |   | 35.9 |   |   |
| Science Education                  |       |                  | 14.0                                |                   |       |   | 14.7 |   |   |   | (0.1 | ) |   |   | 14.0 |   |   |
| Total                              |       |                  | $  143.1                  |                   |       |   | $  103.9 |   |   |   | $ 41.5 |   |   |   | $  132.7 |   |   |
| **Capital  Expenditures**          |       |                  |                                |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                 |       |                  | $     10.8 |                   |       |   | $       6.5 |   |   |   | $    1.2 |   |   |   | $       9.2 |   |   |
| European Lab                       |       |                  | 6.9                                 |                   |       |   | 6.2 |   |   |   | 2.1 |   |   |   | 7.2 |   |   |
| Science Education                  |       |                  | 0.7                                 |                   |       |   | 0.4 |   |   |   | — |   |   |   | 0.2 |   |   |
| Total                              |       |                  | $     18.4 |                   |       |   | $     13.1 |   |   |   | $    3.3 |   |   |   | $     16.6 |   |   |
| **Depreciation  and Amortization** |       |                  |                                |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                 |       |                  | $     19.3 |                   |       |   | $     15.4 |   |   |   | $    5.1 |   |   |   | $     19.3 |   |   |
| European Lab                       |       |                  | 12.8                                |                   |       |   | 9.3 |   |   |   | 3.6 |   |   |   | 12.6 |   |   |
| Science Education                  |       |                  | 1.8                                 |                   |       |   | 1.1 |   |   |   | 0.2 |   |   |   | 1.0 |   |   |
| Total                              |       |                  | $     33.9 |                   |       |   | $     25.8 |   |   |   | $    8.9 |   |   |   | $     32.9 |   |   |

 
|                    | ** ** | **December 31,**                                    | ** ** |
|--------------------|------------|----------------------------------------------------------|------------|
| ** **         | ** ** | **    2005    ** | ** ** | **2004** | ** ** |
| **Assets**         |       |                                                     |       |   |   |
| North American Lab |       | $ 1,690.8                                           |       | $ 1,624.0 |   |
| European Lab       |       | 690.6                                                    |       | 769.6 |   |
| Science Education  |       | 165.9                                                    |       | 159.8 |   |
| Total              |       | $ 2,547.3                                           |       | $ 2,553.4 |   |

 

86

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

Thefollowing is a reconciliation of reported operating income by segment to incomebefore income taxes and cumulative effect of a change in accounting principle:

| ** **                                                                            | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|---------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                                                                            | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                                                                            | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                                                            | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| Operating income, as  reported                                                        |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                                                                    |       |                  | $          | 91.0                   |       |   |   | $ | 65.1 |   |   |   | $ | 28.5 |   |   |   | $ | 82.8 |   |   |
| European Lab                                                                          |       |                  | 38.1       |                   |       |   | 24.1 |   |   |   | 13.1 |   |   |   | 35.9 |   |   |
| Science Education                                                                     |       |                  | 14.0       |                   |       |   | 14.7 |   |   |   | (0.1 | ) |   |   | 14.0 |   |   |
| Total                                                                                 |       |                  | 143.1      |                   |       |   | 103.9 |   |   |   | 41.5 |   |   |   | 132.7 |   |   |
| Interest income                                                                       |       |                  | (2.7       | )                      |       |   | (0.8 | ) |   |   | (0.2 | ) |   |   | (1.7 | ) |   |
| Interest expense:                                                                     |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest on push down debt                                                            |       |                  | —     |                   |       |   | — |   |   |   | 4.1 |   |   |   | 15.2 |   |   |
| All other interest                                                                    |       |                  | 106.7      |                   |       |   | 52.7 |   |   |   | 1.7 |   |   |   | 10.9 |   |   |
| Other (income)  expense, net                                                          |       |                  | (3.8       | )                      |       |   | (2.1 | ) |   |   | 0.1 |   |   |   | (3.0 | ) |   |
| Income before  income taxes and cumulative effect of a change in accounting principle |       |                  | $          | 42.9                   |       |   |   | $ | 54.1 |   |   |   | $ | 35.8 |   |   |   | $ | 111.3 |   |   |

 

Netsales, long-lived assets and total assets by geographic area are as follows: 

| ** **    | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|---------------|------------|-----------------------|------------|------------------------|------------|
| ** **    | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **    | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **    | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| **Net Sales** |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| United States |       |                  | $          | 1,813.1                |       |   |   | $ | 1,322.6 |   |   |   | $ | 456.5 |   |   |   | $ | 1,683.4 |   |   |
| International |       |                  | 1,325.1    |                   |       |   | 889.6 |   |   |   | 336.7 |   |   |   | 1,110.8 |   |   |
| Total         |       |                  | $          | 3,138.2                |       |   |   | $ | 2,212.2 |   |   |   | $ | 793.2 |   |   |   | $ | 2,794.2 |   |   |

 

| ** **             | ** ** | **December 31,** | ** ** |
|------------------------|------------|-----------------------|------------|
| ** **             | ** ** | **2005**              | ** ** | **2004** | ** ** |
| **Long-lived  Assets** |       |                  |       |   |   |
| United States          |       | $                     | 1,069.2    |   | $ | 1,109.8 |   |
| International          |       | 612.7                 |       | 612.0 |   |
| Total                  |       | $                     | 1,681.9    |   | $ | 1,721.8 |   |
| **Assets**             |       |                  |       |   |   |
| United States          |       | $                     | 1,559.3    |   | $ | 1,525.0 |   |
| International          |       | 988.0                 |       | 1,028.4 |   |
| Total                  |       | $                     | 2,547.3    |   | $ | 2,553.4 |   |

 

87

----

**CDRV INVESTORS, INC. Notes to Consolidated Financial Statements (Continued) December 31, 2005, 2004 and 2003 (Dollars in millions, except share data)**

**(20) UnauditedQuarterly Financial Information**

| ** **                                                                            | ** ** | **2005 — Successor** | ** ** |
|---------------------------------------------------------------------------------------|------------|-------------------------------------|------------|
| ** **                                                                            | ** ** | **First**                           | ** ** | **Second** | ** ** | **Third** | ** ** | **Fourth **(1) | ** ** |
| Net sales                                                                             |       | $                                   | 754.1      |   | $ | 794.8 |   | $ | 812.0 |   |   | $ | 777.3 |   |   |
| Gross profit                                                                          |       | 192.7                               |       | 200.8 |   | 209.6 |   |   | 200.6 |   |   |
| Operating income                                                                      |       | 25.0                                |       | 32.8 |   | 47.3 |   |   | 38.0 |   |   |
| Interest expense,  net                                                                |       | 25.1                                |       | 25.6 |   | 26.3 |   |   | 27.0 |   |   |
| Other (income)  expense, net                                                          |       | (1.0                                | )          | (0.8 | ) | (1.3 | ) |   | (0.7 | ) |   |
| Income before  income taxes and cumulative effect of a change in accounting principle |       | 0.9                                 |       | 8.0 |   | 22.3 |   |   | 11.7 |   |   |
| Cumulative effect  of a change in accounting principle                                |       | —                              |       | — |   | — |   |   | (0.5 | ) |   |
| Net income                                                                            |       | 0.5                                 |       | 4.8 |   | 12.3 |   |   | 3.9 |   |   |
|                                                                                       |            |                                     |            |  |  |  |  |  |  |  |  |  |  |  |  |

----

(1)          Operatingincome includes a reduction in accrued bonus of approximately $4.1 and a chargeof $1.7 to write-off deferred costs associated with the termination of acustomer contract by the Company during the quarter.

| ** **                                  | ** ** | **2004**        | ** ** |
|---------------------------------------------|------------|-----------------|------------|
| ** **                                  | ** ** | ** **      | ** ** | **Second** | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                                  | ** ** | ** **      | ** ** | **Predecessor** | ** ** | **Successor** | ** ** |
| ** **                                  | ** ** | ** **      | ** ** | **April 1–** | ** ** | **April 7 –** | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                                  | ** ** | **Predecessor** | ** ** | **April 6,** | ** ** | **June 30,** | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                                  | ** ** | **First**       | ** ** | **2004** | ** ** | **2004** | ** ** | **Third** | ** ** | **Fourth** | ** ** |
| Net sales                                   |       |            | $          | 733.8 |   |   |   | $ | 59.4 |   |   |   | $ | 676.0 |   |   | $ | 760.5 |   | $ | 775.7 |   |
| Gross profit                                |       |            | 190.1      |   |   |   | 15.1 |   |   |   | 171.1 |   |   | 197.7 |   | 190.7 |   |
| Operating income                            |       |            | 38.1       |   |   |   | 3.4 |   |   |   | 31.7 |   |   | 41.2 |   | 31.0 |   |
| Interest expense,  net                      |       |            | 5.3        |   |   |   | 0.3 |   |   |   | 15.9 |   |   | 16.9 |   | 19.1 |   |
| Other (income)  expense, net                |       |            | (0.3       | ) |   |   | 0.4 |   |   |   | 0.5 |   |   | (1.1 | ) | (1.5 | ) |
| Income before income  taxes and cumulative  |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| effect of a  change in accounting principle |       |            | 33.1       |   |   |   | 2.7 |   |   |   | 15.3 |   |   | 25.4 |   | 13.4 |   |
| Net income                                  |       |            | 19.1       |   |   |   | 1.6 |   |   |   | 8.5 |   |   | 13.6 |   | 9.0 |   |
|                                             |            |                 |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

88

----

**ITEM 9.**                CHANGESIN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

**ITEM 9A.**       CONTROLSAND PROCEDURES

In connection with the preparation of this AnnualReport on Form 10-K, management carried out an evaluation, with theparticipation of the Chief Executive Officer and the Chief Financial Officer,of the effectiveness of our disclosure controls and procedures pursuant to Rule 13a-15of the Securities and Exchange Act of 1934. Based on that evaluation, the ChiefExecutive Officer and the Chief Financial Officer concluded that our disclosurecontrols and procedures were effective at a reasonable assurance level as of December 31,2005.

There were no changes inour internal control over financial reporting that occurred during the quarterended December 31, 2005 that have materially affected, or are reasonablylikely to materially affect, our internal control over financial reporting.

**ITEM 9B.**      OTHERINFORMATION

None.

**PART III**

**ITEM 10.**        DIRECTORSAND EXECUTIVE OFFICERS OF THE REGISTRANT

**Directors and Executive Officers**

Thefollowing chart sets forth certain information regarding our directors andexecutive officers:

| **Name**                     | ** ** | ** ** | ** ** | **Age**                                                                               | ** ** | **Position** |
|------------------------------|------------|------------|------------|---------------------------------------------------------------------------------------|------------|--------------|
| John Ballbach                |       | 45         |       | President, Chief  Executive Officer and Director                                      |
| Jack Wyszomierski            |       | 50         |       | Executive Vice President  and Chief Financial Officer                                 |
| Matthew Malenfant            |       | 44         |       | Senior Vice President  and President of North America, Lab Distribution and Services  |
| Manuel Brocke-Benz           |       | 47         |       | Senior Vice President  and Managing Director of Europe, Lab Distribution and Services |
| Charles Canfield             |       | 56         |       | Senior Vice President,  Human Resources                                               |
| Theodore Pulkownik           |       | 48         |       | Senior Vice President of  Strategy, Corporate Development and Emerging Markets        |
| Kevin Leak                   |       | 46         |       | Senior Vice President of  Category Management                                         |
| Jon Michael Colyer           |       | 32         |       | Vice President and  General Manager of Science Education                              |
| B. Charles Ames              |       | 80         |       | Director                                                                              |
| Joseph F.  Eckroth, Jr. |       | 47         |       | Director                                                                              |
| Dr. Lewis S.  Edelheit  |       | 63         |       | Director                                                                              |
| Brian P. Kelley              |       | 45         |       | Director                                                                              |
| Joseph L. Rice, III     |       | 74         |       | Director                                                                              |
| James W. Rogers              |       | 55         |       | Chairman                                                                              |
| Axel Ruckert                 |       | 59         |       | Director                                                                              |
| Richard J. Schnall           |       | 36         |       | Director                                                                              |
| Carl T. Stocker              |       | 62         |       | Director                                                                              |
| Robert J. Zollars            |       | 48         |       | Director                                                                              |

 

89

----

Each of our directors willhold office until our next annual meeting or until a successor is elected orappointed. None of our executive officers or directors has any familialrelationship with any other director or executive officer. “Familialrelationship” for the purposes of this section means any relationship by blood,marriage or adoption, not more remote than first cousin.

*John M. Ballbach*is our President and Chief Executive Officer, as well as one of our directors,positions he has held since November 2005. Before joining us, Mr. Ballbachwas a private investor since April 2004, and President of BallbachConsulting LLC since June 2004. Prior to that, he was an officer of TheValspar Corporation, and served as its President and Chief Operating Officerfrom 2002 until January 2004. From 2000 to 2002, Mr. Ballbach servedas the Senior Vice President of EPS, Color Corporation and Operations, of TheValspar Corporation. Mr. Ballbach joined the Valspar Corporation in 1990and had been its group Vice President, Packaging, since 1998. Mr. Ballbachis a member of the Board of Directors and Audit Committee of CelaneseCorporation. Mr. Ballbach holds a Bachelor of Arts from Georgetown Collegeand a Masters of Business Administration from the Harvard Business School.

*Jack Wyszomierski*isour Executive Vice President and Chief Financial Officer, a position he hasheld since June 2004. Prior to joining us in 2004, Mr. Wyszomierskispent over 20 years at the Schering-Plough Corporation, a corporation thatdevelops and markets prescription drugs, animal health products,over-the-counter drugs and personal care products. Mr. Wyszomierski held avariety of positions at Schering-Plough, most recently serving as ExecutiveVice President and Chief Financial Officer from 1996 until 2003. Mr. Wyszomierskiis a member of the Board of Directors and the Chairman of the Audit Committeeof Exelixis Corporation. Mr. Wyszomierski holds a Bachelor of Science anda Masters of Science from Carnegie Mellon University.

*Matthew Malenfant*isour Senior Vice President, and President of North America, Lab Distribution andServices, a position he has held since January 2006. Mr. Malenfantjoined us in 1995 when we acquired Baxter International’s industrialdistribution business, which was the successor to American Hospital SupplyCorporation. Prior to assuming his present position with us, Mr. Malenfantserved as our Senior Vice President of Sales for the Eastern Zone from 1997 to1999, as our Senior Vice President Marketing and Global Sourcing from 1999 to2004, as our Senior Vice President Global Marketing from 2004 to 2005, and asour Senior Vice President, Supplier Management and Services during 2005.Mr. Malenfant graduated from Arizona State University in 1985 with aBachelor of Arts in Marketing and a Bachelor of Science in Communication.

*Manuel Brocke-Benz*isour Senior Vice President & Managing Director of Europe, LabDistribution and Services, a position he has held since January 2006. Mr. Brocke-Benzjoined the company in 1987. Prior to assuming his present position Mr. Brocke-Benzserved as our Senior Vice President and General Manager Continental Europe from2003 to 2005 and as our Corporate Senior Vice President Process Excellence from2001 to 2003. During the years 1996 to 2001 he served as General ManagerBenelux countries, VP European Key Accounts, VP European Marketing and CorporateSenior VP Global E-business. Mr. Brocke-Benz holds a law degree fromAlbert-Ludwigs University in Freiburg, Germany.

*Charles Canfield*is our Senior Vice President, Human Resources, a position he has held since July 2004.Prior to joining us in 2004, Mr. Canfield was the Senior Vice President,Human Resources and Communications, of the Ondeo Nalco Company from 2001 until2003. Before joining Ondeo Nalco, Mr. Canfield had a long tenure withMoore Corporation Limited, a company specializing in the manufacture ofbusiness forms. Mr. Canfield began his career at Moore in 1973, mostrecently serving as the President of Moore’s Canadian operating division from1997 until 1998, and as Moore’s Vice President, Corporate Human Resources andCommunications, from 1988 until 1997 and from 1998 until 2001. Mr. Canfieldis a member of the Board of Directors of the Human Resources Management 

90

----

Association ofChicago. Mr. Canfield holds a Bachelor of Science from California StateUniversity and a Masters of Business Administration from the University ofToronto.

*Theodore Pulkownik*isour Senior Vice President, Strategy and Business Development, a position he hasheld since July 2004. Prior to joining us in 2004, Mr. Pulkownik heldtwo positions with Standard & Poors, which is a division of theMcGraw-Hill Companies. From 2002 until 2004, Mr. Pulkownik was a ManagingDirector of Standard & Poors Corporate Value Consulting, and from 2000to 2002, Mr. Pulkownik was the Senior Vice President, BusinessDevelopment, for Standard & Poors. Before joining Standard &Poors, Mr. Pulkownik was a Senior Vice President for Holberg Industries, adiversified private holding company located in Greenwich, Connecticut, from1999 until 2000. From 1997 until 1999, Mr. Pulkownik was a Managing Director,Corporate Business and Development, for General Electric Capital Corporation. Mr. Pulkownikholds a Bachelor of Business Administration from the University of Wisconsinand a Masters of Business Administration from the University of Michigan.

*Kevin Leak*is our Senior Vice President of Category Management, a position he has heldsince January 2006. Mr. Leak joined us in 1995 when we acquired theBaxter Scientific Products industrial distribution business from BaxterInternational. Prior to assuming his current position, Mr. Leak served asour Vice President of Global Strategic Sourcing & Supply ChainManagement from 2004 to 2005, the North America Vice President of Marketingfrom 2000 to 2004, and Vice President of Marketing for our Production Supplies &Services business from 1998 to 2000. Mr. Leak is a former United StatesArmy officer where he held several positions in both command and staff. He is agraduate of Pace University with a Bachelor of Business Administration inManagement and Masters of Business Administration in Marketing.

*Jon Michael Colyer*isour Vice President and General Manager of Science Education, a position he hasheld since May 2005. Mr. Colyer joined us in 2004 as our VicePresident North American Call Centers. Prior to joining us, Mr. Colyerworked for Textron, a large industrial conglomerate, as the Director forEnterprise Excellence and Director of Bell Helicopter’s Composite Manufacturingfacility. Prior to Textron, Mr. Colyer spent five years with GE in variousroles including Six Sigma Black Belt, Ecommerce Program Manager, and LeadershipDevelopment Program Member. Mr. Colyer graduated from the University atBuffalo in 1996 with a Bachelor of Science in Civil Engineering and an MBA inCorporate Finance.

*B. Charles Ames*is one of our directors, a position he has held since the Acquisition. Mr. Amesis Vice Chairman and a principal of CD&R. Prior to joining CD&R in1987, Mr. Ames served as Chairman and Chief Executive Officer of RelianceElectric Company, Chief Executive Officer of Acme Cleveland Corporation, andChief Executive Officer and Chairman of The Uniroyal Goodrich Tire Company. Mr. Ames’family trust is a limited partner of CD&R Associates VI LimitedPartnership. Mr. Ames is a director and stockholder of CD&R InvestmentAssociates VI, Inc. He also serves on the Boards of Directors of LexmarkInternational, Inc. and Remington Arms Company, Inc. Mr. Amesholds a Ph.B. from Illinois Wesleyan University and a Masters of BusinessAdministration from Harvard Business School.

*Joseph F. Eckroth, Jr.*is one of our directors, a position he has held since November 9,2004. Mr. Eckroth is the Executive Vice President and Chief OperatingOfficer for New Century Financial Corporation. Prior to joining New Century, Mr. Eckrothserved as the Chief Information Officer for Mattel, Inc., a position heheld from 2000 until 2005. Prior to joining Mattel, Inc., Mr. Eckrothserved as an information technology executive for the General Electric Companyfrom 1996 until 2000, where he was the Chief Information Officer for the GEMedical Systems and GE Industrial Systems business units. Prior to joiningGeneral Electric, Mr. Eckroth served in a variety of senior leadershippositions for the Northrop Grumman Corporation from 1985 until 1996, most recentlyas Director of Information Systems and 

91

----

Technology. Mr. Eckrothholds a Bachelor of Science from the University of La Verne and a Masters ofBusiness Administration from Pepperdine University School of Business andManagement.

*Dr. Lewis S. Edelheit*is one of our directors, a position he has held since August 31,2004. Dr. Edelheit retired from his position as the Senior Vice President,Corporate Research and Development, for the General Electric Company in 2001. Dr. Edelheitbegan his long tenure at General Electric as a physicist in the GeneralElectric Research and Development Center in 1969, and returned to GeneralElectric in 1991 to head its research and development efforts after a stint asthe President and Chief Executive Officer of Quantum Medical Systems from 1986until 1991. Dr. Edelheit is a member of the National Academy ofEngineering, and a Fellow of the American Physical Society. Dr. Edelheitserves as a director of Silicon Graphics, Inc., Sonic Innovations, Inc.and Hubspan, Inc. Dr. Edelheit holds a Bachelor of Science, a Mastersof Science and a Ph.D. from the University of Illinois.

*Brian P. Kelley*is one of our directors, a position he has held since August 31, 2004. Mr. Kelleyis the President and Chief Executive Officer of SIRVA, Inc., a position hehas held since 2002. Prior to joining SIRVA, Inc., Mr. Kelley was anexecutive for the Ford Motor Company, serving as the President of Ford’sLincoln Mercury business from 2001 until 2002, and as Ford’s Vice President ofGlobal Consumer Services from 1999 until 2001. Prior to joining Ford, Mr. Kelleywas a senior executive for General Electric Company from 1994 until 1999. Mr. Kelleybegan his career at Procter & Gamble in 1983, where he was ultimatelyresponsible for some of the company’s most recognized brand names. Mr. Kelleyalso serves as a director of SIRVA, Inc. Mr. Kelley received aBachelor of Arts in economics from The College of Holy Cross.

*Joseph L. Rice, III*isone of our directors, a position he has held since shortly after the Acquisition.Mr. Rice is one of the original partners of CD&R. Mr. Rice hasspent the major portion of his business career in private equity. Aftergraduating from law school in 1960, Mr. Rice practiced law with Sullivan &Cromwell until 1966 when he entered the private equity business. In 1969, Mr. Riceco-founded Gibbons, Green & Rice, and in 1978, CD&R. Mr. Riceis a Trustee of The Chapin School, a Trustee Emeritus of Williams College and amember of the Board of Trustees of The Manhattan Institute, INSEAD’sInternational Council and the JPMorgan National Advisory Board. Mr. Riceis a limited partner of CD&R Associates VI Limited Partnership, and adirector and stockholder of CD&R Investment Associates VI, Inc. Mr. Riceis a Director of Italtel Holding S.p.A. and Uniroyal Holding, Inc. Aftergraduating from Williams in 1954, Mr. Rice enlisted in the United StatesMarine Corps and served as a Lieutenant from 1954 to 1957. Mr. Rice thenearned his law degree at Harvard Law School.

*James W. Rogers*isour Chairman, a position he has held since the Acquisition. Mr. Rogersserved as our Chief Executive Officer from May until November 2005. Mr. Rogersis an operating principal of CD&R. Prior to joining CD&R in 1998; Mr. Rogerswas a Senior Vice President and a member of the Corporate Executive Council ofGeneral Electric Company. From 1995 to 1998, Mr. Rogers was President andChief Executive Officer of GE Industrial Control Systems. Mr. Rogers is alimited partner of CD&R Associates VI Limited Partnership, and a directorand stockholder of CD&R Investment Associates VI, Inc. Mr. Rogerscurrently serves as a director of SIRVA, Inc. Mr. Rogers holds aBachelor of Arts in economics from Rutgers College.

*Axel Ruckert*is one of our directors, a position he has held since August 31, 2004. Mr. Ruckertis the President of Management Partenaires, a French firm specializing inturn-around management of companies experiencing financial difficulties. Sincefounding Management Partenaires in 1984, Mr. Ruckert has held executive positionswith several companies while working to implement strategic restructurings ofthese companies, most recently serving as the Chairman and Chief ExecutiveOfficer of Getronics, an information technology services company, in 2003.Prior to working at Getronics, Mr. Ruckert was the Chief Executive Officerof Philips Consumer Communications from 2001 until 2002, 

92

----

and the ChiefOperating Officer of BSN Glasspack, a European glass container manufacturer,from 1999 until 2000. Mr. Ruckert received a Master of Political Scienceand Economics at the Free University of Berlin and the University of Cologne.

*Richard J. Schnall*is one of our directors, a position he has held since the Acquisition. Mr. Schnallis a financial principal of CD&R. Prior to joining CD&R in 1996, heworked in the Investment Banking division of Donaldson, Lufkin &Jenrette, Inc. and Smith Barney & Co. Mr. Schnall is alimited partner of CD&R Associates VI Limited Partnership, and a directorand stockholder of CD&R Investment Associates VI, Inc. He serves as adirector of SIRVA, Inc. Mr. Schnall is a graduate of the WhartonSchool of Business at the University of Pennsylvania and holds a Masters ofBusiness Administration from Harvard Business School.

*Carl T. Stocker*is one of our directors, a position he has held since August 31, 2004.Since 1997, Mr. Stocker has owned and managed his own acquisition,investment and consulting company, CTS Enterprises, LLC. Prior to that time, Mr. Stockerserved as the chief financial executive of General Electric’s IndustrialSystems business from 1990 until 1996, and the chief information executive from1992 until 1996. Mr. Stocker was also a member of General Electric’sCorporate Finance and Information Technology Councils during these sameperiods, and served as a senior integration leader for the Space SystemsDivision created by General Electric’s acquisition of RCA. Mr. Stocker isa director of SIRVA, Inc. Mr. Stocker graduated from Wright StateUniversity in 1970 after serving with the U.S. Army.

*Robert J. Zollars*is one of our directors, a position he has held since August 31, 2004.Since 1999, Mr. Zollars has been the Chairman and CEO of Neoforma, Inc.,a healthcare technology company focusing on the supply chain. Prior to joiningNeoforma, Mr. Zollars was the EVP and Group President of Cardinal Health, Inc.,from 1997 until 1999, and was responsible for five of their wholly-ownedsubsidiaries. From 1992 until 1996, Mr. Zollars was the President of theHospital Supply and Scientific Product distribution business at BaxterInternational. Mr. Zollars serves as a director of For Health Technologiesand Alliance Medical Corp. Mr. Zollars is the Chairman of the Center forServices Leadership at Arizona State University, and is a member of the YoungPresidents Organization. Mr. Zollars is a graduate of Arizona StateUniversity and holds a Masters of Business Administration from John F. KennedyUniversity.

**Compositionof our Board of Directors**

Our business and affairsare managed under the direction of our board of directors. Our board iscomposed of eleven directors, none of whom, with the exception of Mr. Ballbach,are executive officers of our company.

**Audit Committee**

Ouraudit committee currently consists of Dr. Lewis S. Edelheit, Joseph L.Rice, III, Axel Ruckert, Richard J. Schnall, and Carl T. Stocker. Ourboard of directors has determined that Carl T. Stocker is the current auditcommittee financial expert serving on the audit committee for purposes of theSecurities and Exchange Act of 1934. Mr. Stocker is an independentdirector within the meaning of the Securities and Exchange Act of 1934. Ouraudit committee has responsibility for, among other things, assisting our boardof directors in monitoring:

·                    the quality ofour financial reporting and other internal control processes,

·                    the qualityand integrity of our financial statements,

93

----

·                    theindependent auditors’ qualifications and independence,

·                    theperformance of our internal audit function and independent auditors, and

·                    our compliancewith legal and regulatory requirements and its code of conduct.

**Code of Ethics**

The Company has adoptedthe VWR International, Inc. Code of Ethics and Conduct (the “Code”), acode of ethics as defined under Regulation S-K promulgated under the SecuritiesAct of 1933, that applies to all of the Company’s employees including theCompany’s Chief Executive Officer, Chief Financial Officer, CorporateController and all professionals in finance and finance-related departments.This Code is available on the Company’s website at *www.vwr.com*on the About VWR portion of the site. The Company intends to satisfy itsdisclosure obligations under Item 10 of Form 8-K by postinginformation about amendments to, or waivers from, a provision of the Code thatapply to the Company’s Chief Executive Officer, Chief Financial Officer, andCorporate Controller on the Company’s website at the address above.

**ITEM11.**        EXECUTIVE COMPENSATION

The following table setsforth the compensation earned by our current and former Chief ExecutiveOfficers and our four additional most highly compensated executive officers(each, a “named executive officer”) for the last three completed fiscal years.

94

----

**SummaryCompensation Table**

| Name and Principal  Position (4)(5)(6) | ** ** | ** ** | ** ** | **Year** | ** ** | **Salary($)** | ** ** | **Bonus($)** | ** ** | **Other Annual  Compensation  ($)(1)** | ** ** | **Restricted  Stock Awards  ($)(3)** | ** ** | **Number of  Securities  Underlying  Options/SARS** | ** ** | **All Other  Compensation  ($)(2)** | ** ** |
|-------------------------------------------------------|------------|------------|------------|----------|------------|---------------|------------|--------------|------------|---------------------------------------------|------------|-------------------------------------------|------------|----------------------------------------------------------|------------|------------------------------------------|------------|
| John Ballbach                                         |       |       | 2005       |     |       | $             | 98,684     |         |       | $                                           | 100,000    |                                      |       |                                                     | $          | 2,365                                    |       |   |   | $ | 500,000 |   |   |   | — |   |   |   | $ | 74,050 |   |   |
| Director, President                                   |       |       | 2004       |     |       | —        |       |         | —     |                                        |       |                                      | —     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| and Chief Executive Officer                           |       |       | 2003       |     |       | —        |       |         | —     |                                        |       |                                      | —     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| Walter Zywottek                                       |       |       | 2005       |     |       | 225,000       |       |         | —     |                                        |       |                                      | 5,321      |                                                     |       |                                     | —     |   |   |   | — |   |   |   | 87,721 |   |   |
| Former Director, President                            |       |       | 2004       |     |       | 560,273       |       |         | 252,913    |                                        |       |                                      | 14,890     |                                                     |       |                                     | —     |   |   |   | 22,500 |   |   |   | 70,348 |   |   |
| and Chief Executive  Officer                          |       |       | 2003       |     |       | 430,500       |       |         | 279,825    |                                        |       |                                      | 14,950     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | 1,956 |   |   |
| James W. Rogers                                       |       |       | 2005       |     |       | —        |       |         | —     |                                        |       |                                      | —     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| Former Chief Executive Officer                        |       |       | 2004       |     |       | —        |       |         | —     |                                        |       |                                      | —     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| and Current Chairman                                  |       |       | 2003       |     |       | —        |       |         | —     |                                        |       |                                      | —     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| Edward Orzetti                                        |       |       | 2005       |     |       | 550,020       |       |         | —     |                                        |       |                                      | 14,505     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | 5,626 |   |   |
| Executive Vice President  and                         |       |       | 2004       |     |       | 343,763       |       |         | 344,138    |                                        |       |                                      | 20,465     |                                                     |       |                                     | 280,000    |   |   |   | 45,000 |   |   |   | 109,260 |   |   |
| President, General Lab  Business                      |       |       | 2003       |     |       | —        |       |         | —     |                                        |       |                                      | —     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| Jack Wyszomierski                                     |       |       | 2005       |     |       | 350,040       |       |         | —     |                                        |       |                                      | 14,190     |                                                     |       |                                     | 250,000    |   |   |   | — |   |   |   | 1,109 |   |   |
| Executive Vice President and                          |       |       | 2004       |     |       | 192,287       |       |         | 163,400    |                                        |       |                                      | 7,795      |                                                     |       |                                     | —     |   |   |   | 20,000 |   |   |   | 48,738 |   |   |
| Chief Financial Officer                               |       |       | 2003       |     |       | —        |       |         | —     |                                        |       |                                      | —     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| Matthew Malenfant                                     |       |       | 2005       |     |       | 281,258       |       |         | —     |                                        |       |                                      | 14,190     |                                                     |       |                                     | 250,000    |   |   |   | — |   |   |   | 9,547 |   |   |
| Senior Vice President and                             |       |       | 2004       |     |       | 238,595       |       |         | 123,637    |                                        |       |                                      | 14,190     |                                                     |       |                                     | —     |   |   |   | 7,000 |   |   |   | 25,726 |   |   |
| President of North  America Lab                       |       |       | 2003       |     |       | 218,190       |       |         | 107,833    |                                        |       |                                      | 14,190     |                                                     |       |                                     | —     |   |   |   | — |   |   |   | 4,566 |   |   |
| Distribution  and Services                            |       |       |       |     |       |          |       |         |       |                                        |       |                                      |       |                                                     |       |                                     |       |   |   |   |   |   |   |   |   |   |   |
| Manuel Brocke-Benz                                    |       |       | 2005       |     |       | 248,944       |       |         | 150,552    |                                        |       |                                      | 7,384      |                                                     |       |                                     | 150,000    |   |   |   | — |   |   |   | — |   |   |
| Senior Vice President and                             |       |       | 2004       |     |       | 243,684       |       |         | 62,076     |                                        |       |                                      | 7,088      |                                                     |       |                                     | —     |   |   |   | 7,000 |   |   |   | 20,737 |   |   |
| Managing Director of Europe Lab                       |       |       | 2003       |     |       | 186,896       |       |         | 48,512     |                                        |       |                                      | 7,150      |                                                     |       |                                     | —     |   |   |   | — |   |   |   | — |   |   |
| Distribution and Services                             |       |       |       |     |       |          |       |         |       |                                        |       |                                      |       |                                                     |       |                                     |       |   |   |   |   |   |   |   |   |   |   |
|                                                       |            |            |            |          |            |               |            |              |            |                                             |            |                                           |            |                                                          |            |                                          |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

----

(1)             The 2005 amounts reported include (a) automobileallowances of $2,365, $5,321, $14,505, $14,190 and $14,190 for Messrs. Ballbach,Zywottek, Orzetti, Wyszomierski and Malenfant and (b) $7,384 for anautomobile lease paid by the Company for Mr. Brocke-Benz. The 2004 amountsreported include (a) automobile allowances of $14,190, $9,066, $7,795, and$14,190 for Messrs. Zywottek, Orzetti, Wyszomierski and Malenfant and (b) $7,088for an automobile lease paid by the Company for Mr. Brocke-Benz. The 2004amount reported for Mr. Orzetti includes a housing allowance of $11,399. The2003 amounts reported include (a) automobile allowances of $14,190 and$14,190 for Messrs. Zywottek and Malenfant and (b) $7,150 for anautomobile lease paid by the Company for Mr. Brocke-Benz.

(2)             Amounts reported for 2005 include (a) acontribution to our 401(k) or other defined contribution retirement planof $4,833 and $9,167 for Messrs. Orzetti and Malenfant, (b) imputedvalue of guaranteed term life insurance policies for Messrs. Ballbach,Zywottek, Orzetti, Wyszomierski and Malenfant of $69, $1,183, $793, $1,109 and$380, (c) relocation benefits of $73,981 for Mr. Ballbach inconnection with his move to commence employment and (d) a payment of$86,538 to Mr. Zywottek for his accrued unused vacation. Amounts reportedfor 2004 include (a) respective special payments of $54,450, $108,900,$48,400, $16,940 and $16,940 to Messrs. Zywottek, Orzetti, Wyszomierski,Malenfant and Brocke-Benz earned in connection with the December 16, 2004issuance by CDRV Investors, Inc. of $481.0 million aggregate principal amountat maturity ($299.4 million gross proceeds) of 95¤8% senior discount notes due 2015 and a related specialdistribution to CDRV Investors, Inc. shareholders, (b) payments to Messrs. Zywottek,Malenfant and Brocke-Benz of $13,240, $3,788 and $3,797 in settlement of ourobligations under a predecessor bonus plan that was terminated in connectionwith the Acquisition, (c) a contribution to our 401(k) or otherdefined contribution retirement plan of $4,772 for Mr. Malenfant and (d) imputedvalue of guaranteed term life insurance policies for Messrs. Zywottek,Orzetti, Wyszomierski and Malenfant of $2,658, $360, $338 and $226. Amountsreported for 2003 include (a) a contribution to our 401(k) or otherdefined contribution retirement plan of $4,364 for 

95

----

Mr. Malenfant and (b) imputedvalue of guaranteed term life insurance policies for Messrs. Zywottek andMalenfant of $1,956 and $202.

(3)             Mr. Ballbach was granted 6,666 CDRV Investors, Inc.restricted stock units in connection with his commencement of employment. Thevalue of Mr. Ballbach’s restricted stock unit grant is shown based on thevalue of an unrestricted share of CDRV Investors, Inc. common stock onsuch date. Mr. Ballbach is not entitled to receive any dividends on hisrestricted stock units. The restricted stock units will vest in equal annualinstallments on each of the first five anniversaries of the grant date or, ifearlier, on a change in control or termination of employment on death ordisability (all as provided under the Restricted Stock Unit Agreement and theCDRV Investors, Inc. Stock Incentive Plan). The 6,666 CDRVInvestors, Inc. restricted stock units Mr. Ballbach received in thisgrant were the only restricted stock units held by him as of December 31,2005. Mr. Ballbach’s restricted stock holdings, including restricted stockunits, were valued at $500,000, based on the value of an unrestricted share ofCDRV Investors, Inc. common stock as of December 31, 2005. Messrs. Wyszomierski,Malenfant and Brocke-Benz were granted 3,333, 3,333 and 2,000 CDRV Investors, Inc.restricted stock units, respectively, pursuant to the CDRV Investors, Inc.Stock Incentive Plan. Messrs. Wyszomierski, Malenfant and Brocke-Benz arenot entitled to receive any dividends on their restricted stock units. Therestricted stock units will vest in equal annual installments on each of thefirst five anniversaries of the grant date or, if earlier, on a change incontrol or termination of employment on death or disability (all as providedunder the Restricted Stock Unit Agreement and the CDRV Investors, Inc.Stock Incentive Plan). The value of the restricted stock unit grants ofMessrs. Wyszomierski, Malenfant and Brocke-Benz is shown based on thevalue of an unrestricted share of CDRV Investors, Inc. common stock on thedate of grant. These units were the only restricted stock units held byMessrs. Wyszomierski, Malenfant and Brocke-Benz as of December 31,2005, and the restricted stock holdings, including restricted stock units, ofeach of Mr. Wyszomierski, Malenfant and Brocke-Benz were valued at$250,000, $250,000, and $150,000, respectively, based on the value of anunrestricted share of CDRV Investors, Inc. common stock as ofDecember 31, 2005. Mr. Orzetti was granted 5,000 CDRV Investors, Inc.restricted stock units in connection with his commencement of employment. Therestricted stock units had a value of $280,000 on the date of grant based onthe value of an unrestricted share of CDRV Investors, Inc. common stock onsuch date. The value of Mr. Orzetti’s restricted stock units, based on thevalue of an unrestricted share of CDRV Investors, Inc. common stock, as ofDecember 31, 2005 was $375,000. Mr. Orzetti is not entitled toreceive any dividends on his restricted stock units. All of Mr. Orzetti’srestricted stock units were forfeited in February 2006 in connection withhis termination of employment.

(4)             Mr. Zywottek was our President, Chief ExecutiveOfficer and Director until May 2005. From May 2005 until November 2005,James W. Rogers, our Chairman, served as Chief Executive Officer. Effective November 2005,John M. Ballbach became our President, Chief Executive Officer and Director.

(5)             Mr. Rogers served as our Chief Executive Officerfrom May 2005 until November 2005 pursuant to a loanout agreement weentered into with Clayton, Dubilier & Rice, Inc. Mr. Rogersremained an employee of Clayton, Dubilier & Rice, Inc. while heserved as our Chief Executive Officer and was therefore not paid anycompensation by us for his services. The management fee we pay to Clayton, Dubilier &Rice, Inc. pursuant to the consulting agreement described under theheading “Certain Relationships and Related Transactions—Consulting Agreement”was increased by $500,000 annually for the period Mr. Rogers served as ourChief Executive Officer.

(6)             Mr. Orzetti was our Executive VicePresident and President, General Lab Business until his termination ofemployment effective February 2006.

96

----

**AggregatedOption Exercises In Last Fiscal Year And Fiscal Year-End Option Values**

Thefollowing table shows aggregate exercises of stock options in the 2005 fiscalyear by the named executive officers and the value of unexercised stock optionsheld by the named executive officers at December 31, 2005. All optionswere granted under theCDRV Investors, Inc. Stock Incentive Plan.

| **Name**            | ** ** | ** ** | ** ** | **Shares  Acquired on  Exercise** | ** ** | **Value  Realized** | ** ** | **Number of  Securities  Underlying  Unexercised  Options at FY  End  Exercisable/  Unexercisable** | ** ** | **Value of  Unexercised In-  the-Money  Options at FY  End  Exercisable/  Unexercisable(1)** | ** ** |
|---------------------|------------|------------|------------|----------------------------------------|------------|---------------------|------------|--------------------------------------------------------------------------------------------------------------------|------------|------------------------------------------------------------------------------------------------------------------|------------|
| John Ballbach(2)    |       |       | —     |                                   |       |                | —     |                                                                                                               |       | —                                                                                                           |       | $ | — |   |
| Walter  Zywottek(3) |       |       | —     |                                   |       |                | —     |                                                                                                               |       | —                                                                                                           |       | — |   |
| James W. Rogers     |       |       | —     |                                   |       |                | —     |                                                                                                               |       | —                                                                                                           |       | — |   |
| Edward Orzetti(4)   |       |       | —     |                                   |       |                | —     |                                                                                                               |       | 9,000/36,000                                                                                                     |       | 220,320/881,280 |   |
| Jack Wyszomierski   |       |       | —     |                                   |       |                | —     |                                                                                                               |       | 4,000/16,000                                                                                                     |       | 97,920/391,680 |   |
| Matthew Malenfant   |       |       | —     |                                   |       |                | —     |                                                                                                               |       | 1,400/5,600                                                                                                      |       | 34,272/137,088 |   |
| Manuel Brocke-Benz  |       |       | —     |                                   |       |                | —     |                                                                                                               |       | 1,400/5,600                                                                                                      |       | 34,272/137,088 |   |
|                     |            |            |            |                                        |            |                     |            |                                                                                                                    |            |                                                                                                                  |            |  |  |  |  |  |

----

(1)          The“Value of Unexercised In-the-Money Options at FY End” is the aggregate numberof unexercised options on December 31, 2005 multiplied by the differencebetween the exercise price for each option and the fair market value of a shareof CDRV Investors, Inc. common stock on December 31, 2005 ($75.00).The actual value, if any, that will be realized upon the exercise of an option,will depend upon the difference between the exercise price of the option andthe fair market value of the CDRV Investors, Inc. common stock on the datethat the option is exercised.

(2)        Pursuantto the terms of Mr. Ballbach’s amended employment agreement, he received agrant of 58,929 options immediately following his purchase of shares of CDRVInvestors, Inc. common stock in March 2006.

(3)        All22,500 options previously granted to Mr. Zywottek were unvested when heterminated employment in May 2005, and were thus cancelled without anypayment.

(4)        Inconnection with Mr. Orzetti’s termination of employment in February 2006,CDRV Investors, Inc. agreed to vest an additional 9,000 options held by Mr. Orzetti,so that upon his termination of employment he held 18,000 vested options.

**EmploymentAgreements With Named Executive Officers**

·       *Mr. Ballbach*. In November 2005, Mr. Ballbachjoined us as our new President and Chief Executive Officer, and entered into anemployment agreement with us in connection with his commencement of employment.Mr. Ballbach’s agreement was subsequently amended in part by a letteragreement entered into in February 2006.

Pursuant to his amended employment agreement and as ofDecember 31, 2005, Mr. Ballbach receives an annual base salary of$650,000 and is also eligible to receive an annual bonus that becomes earnedbased on the achievement of objectives established under our applicable bonusplan. Mr. Ballbach’s target annual bonus is equal to 100% of his basesalary. Because Mr. Ballbach started with us before November 7, 2005,he received a guaranteed bonus of $100,000 for 2005. In addition, we agreed topay Mr. Ballbach a one-time special bonus of $1,119,651 in February 2006in connection with his agreeing to amend the terms of his original employmentagreement.

Mr. Ballbach’s amended agreement does not have afixed term. However, if we terminate Mr. Ballbach’s employment withoutcause, he will be entitled to continued payment of his then 

97

----

current base salary and continued health benefits fora period equal to the earlier of eighteen months following any such terminationor the date that he obtains new employment.

Pursuant to Mr. Ballbach’samended employment agreement, he agreed to purchase 19,643 shares of the commonstock of CDRV Investors, Inc. during March 2006 pursuant to the CDRVInvestors, Inc. Stock Incentive Plan. In connection with his purchase, hereceived a grant of 58,929 options to purchase shares of CDRV Investors, Inc.common stock. Mr. Ballbach’s amended agreement also provides that in 2006he will receive an award of CDRV Investors, Inc. restricted stock unitshaving a value equal to $500,000. The restricted stock units will vest in fiveequal installments on each of the first five anniversaries of the grant date,and may vest earlier in certain circumstances if we undergo a change in control(as defined in the CDRV Investors, Inc. Stock Incentive Plan) or if hisemployment terminates due to death or disability (as defined in the CDRVInvestors, Inc. Stock Incentive Plan).

·       *Mr. Zywottek*.   Prior to histermination of employment with us in May 2005, we were parties to anemployment agreement with Mr. Zywottek. In connection with his terminationof employment, Mr. Zywottek received continued payment of his healthbenefits until September 1, 2005, but did not receive any severance orother additional compensation pursuant to his employment agreement.

·       *Mr. Orzetti*.   Prior to histermination of employment with us in February 2006, we were parties to anemployment agreement with Mr. Orzetti. Pursuant to his employmentagreement and as of December 31, 2005, Mr. Orzetti received an annualbase salary of $550,020 and was also eligible to receive an annual bonus thatbecame earned based on the achievement of objectives established under ourapplicable bonus plan. Mr. Orzetti’s target annual bonus was equal to 100%of his base salary.

In connection with Mr. Orzetti’s termination ofemployment in February 2006, we entered into an agreement with him settingforth the terms of his resignation. Under the agreement, Mr. Orzetti isentitled to receive a lump sum severance payment equal to $550,000, continuedhealth and dental benefits until August 31, 2006, COBRA benefitcontinuation, the repurchase of previously acquired shares of CDRV Investors, Inc.common stock, and accelerated vesting of 9,000 unvested options in CDRVInvestors, Inc.

The agreement also contains customary non-competitionand non-solicitation restrictions that will apply for one year following Mr. Orzetti’sresignation, and an indefinite restriction on the disclosure of confidentialinformation.

·       *Mr. Wyszomierski*.   In June 2004, Mr. Wyszomierskijoined us as our new Executive Vice President and Chief Financial Officer, andentered into an employment agreement with us upon his commencement of employment.Mr. Wyszomierski’s agreement does not have a fixed term. Pursuant to hisemployment agreement and as of December 31, 2005, Mr. Wyszomierskireceives an annual base salary of $350,000 and is also eligible to receive anannual bonus that becomes earned based on the achievement of objectivesestablished under our applicable bonus plan. Mr. Wyszomierski’s targetannual bonus is equal to 85% of his base salary.

Mr. Wyszomierski wasoffered the opportunity to participate in the CDRV Investors, Inc. StockIncentive Plan pursuant to his employment agreement.Inlate 2005, Mr. Wyszomierski was granted CDRV Investors, Inc.restricted stock units having a value equal to $250,000. The restricted stockunits will vest in five equal installments on each of the first fiveanniversaries of the grant date, and may vest earlier in certain circumstancesif we undergo a change in control (as defined in the CDRV Investors, Inc.Stock Incentive Plan) or if his employment terminates due to death ordisability (as defined in the CDRV Investors, Inc. Stock Incentive Plan).

·       *Mr. Malenfant*.    As of December 31,2005, Mr. Malenfant receives an annual base salary of $300,000 and is alsoeligible to receive an annual bonus that becomes earned on the achievement of 

98

----

objectives establishedunder our applicable bonus plan. Mr. Malenfant’s target annual bonus isequal to 75% of his base salary.

Mr. Malenfant wasoffered the opportunity to participate in the CDRV Investors, Inc. StockIncentive Plan. In late 2005, Mr. Malenfant was granted CDRV Investors, Inc.restricted stock units having a value equal to $250,000. The restricted stockunits will vest in five equal installments on each of the first fiveanniversaries of the grant date, and may vest earlier in certain circumstancesif we undergo a change in control (as defined in the CDRV Investors, Inc.Stock Incentive Plan) or if his employment terminates due to death ordisability (as defined in the CDRV Investors, Inc. Stock Incentive Plan).

·       *Mr. Brocke-Benz*.    As of December 31,2005, Mr. Brocke-Benz receives an annual base salary of €200,000and is also eligible to receive an annual bonus that becomes earned on theachievement of objectives established under our applicable bonus plan. Mr. Brocke-Benz’starget annual bonus is equal to 70% of his base salary.

Mr. Brocke-Benz was offered the opportunity toparticipate in the CDRV Investors, Inc. Stock Incentive Plan. In late2005, Mr. Brocke-Benz was granted CDRV Investors, Inc. restrictedstock units having a value equal to $150,000. The restricted stock units willvest in five equal installments on each of the first five anniversaries of thegrant date, and may vest earlier in certain circumstances if we undergo achange in control (as defined in the CDRV Investors, Inc. Stock IncentivePlan) or if his employment terminates due to death or disability (as defined inthe CDRV Investors, Inc. Stock Incentive Plan).

**Changein Control and Termination of Employment Arrangements under New Stock IncentivePlan**

The CDRVInvestors, Inc. Stock Incentive Plan provides that the vesting of optionsto purchase shares of our common stock granted thereunder will be acceleratedif we experience a change in control (as defined in the plan) where substituteoptions with substantially equivalent terms and economic value are notsubstituted for existing options in place of accelerated vesting. The vestingof options will also be accelerated upon certain terminations of employment,such as death or disability (as defined in the plan). The Company’s board ofdirectors has the discretion to accelerate the vesting of options at any timeand from time to time.

**Pension Plans**

We sponsor various retirement plans for most full-timeemployees, including a defined benefit plan that covered Messr. Malenfantuntil the plan was frozen on May 31, 2005 and Mr. Zywottek until histermination of employment in 2005.

The pension plan wesponsor covered substantially all of our full-time United States employees(except employees covered by collective bargaining agreements who participatein independently operated plans). Annual retirement benefits under the pensionplan are generally calculated as the greater of:

·       aparticipant’s years of credited service multiplied by $240, and

·       1%of a participant’s average annual compensation earned in the consecutive fiveyear period during which the participant was most highly paid (referred to as“final average earnings”), plus an additional 0.75% of final average earningsin excess of one third of the Social Security taxable wage base in the year theparticipant terminates employment, in each case multiplied by the participant’syears of credited service (up to a maximum of 33 years).

99

----

Underthe pension plan, final average earnings includes the participant’s salary andbonus indicated earlier under the heading “—Summary Compensation Table,” aswell as any other bonus or severance payments that a participant may becomeentitled to. Because the pension plan complies with ERISA and Code maximumcompensation and defined benefit limitations, certain of the annual retirementbenefits indicated in the table below will be paid pursuant to an unfundedbenefit equalization plan, or supplemental plan, of the type permitted byERISA. The following table shows the estimated annual benefits payable uponretirement to persons in specified remuneration and years of serviceclassifications under the pension plan and supplemental plan.

| ** **          | ** ** | **Estimated Annual Pension  (Years of Service)** | ** ** |
|---------------------|------------|----------------------------------------------------------------------|------------|
| **Remuneration**    | ** ** | ** **                                                           | ** ** | **15** | ** ** | **20** | ** ** | **25** | ** ** | **30** | ** ** | **35** | ** ** |
| $125,000            |       | $                                                                    | 29,516     |   | $ | 39,355 |   | $ | 49,194 |   | $ | 59,033 |   | $ | 64,936 |   |
|   150,000 |       | 36,079                                                               |       | 48,105 |   | 60,131 |   | 72,158 |   | 79,373 |   |
|   175,000 |       | 42,641                                                               |       | 56,855 |   | 71,069 |   | 85,283 |   | 93,811 |   |
|   200,000 |       | 49,204                                                               |       | 65,605 |   | 82,006 |   | 98,408 |   | 108,248 |   |
|   225,000 |       | 55,766                                                               |       | 74,355 |   | 92,944 |   | 111,533 |   | 122,686 |   |
|   250,000 |       | 62,329                                                               |       | 83,105 |   | 103,881 |   | 124,658 |   | 137,123 |   |
|   300,000 |       | 75,454                                                               |       | 100,605 |   | 125,756 |   | 150,908 |   | 165,998 |   |
|   400,000 |       | 101,704                                                              |       | 135,605 |   | 169,506 |   | 203,408 |   | 223,748 |   |
|   450,000 |       | 114,829                                                              |       | 153,105 |   | 191,381 |   | 229,658 |   | 252,623 |   |
|   500,000 |       | 127,954                                                              |       | 170,605 |   | 213,256 |   | 255,908 |   | 281,498 |   |
|   550,000 |       | 141,079                                                              |       | 188,105 |   | 235,131 |   | 282,158 |   | 310,373 |   |
|   600,000 |       | 154,204                                                              |       | 205,605 |   | 257,006 |   | 308,407 |   | 339,248 |   |
|   650,000 |       | 167,329                                                              |       | 223.105 |   | 278,881 |   | 334,658 |   | 368,123 |   |
|   700,000 |       | 180,454                                                              |       | 240,605 |   | 300,756 |   | 360,908 |   | 396,998 |   |
|   750,000 |       | 193,579                                                              |       | 258,105 |   | 322,631 |   | 387,158 |   | 425,873 |   |
|   800,000 |       | 206,704                                                              |       | 275,605 |   | 344,506 |   | 413,408 |   | 454,748 |   |
|   850,000 |       | 219,829                                                              |       | 293,105 |   | 366,381 |   | 439,658 |   | 483,623 |   |
|                     |            |                                                                      |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

As of December 31,2005, Messrs. Malenfant and Zywottek have 18 years and less than 1 year ofcredited service, respectively. Benefits shown in the table above are computedon the basis of straight life annuity benefits, and are not subject to deductionor offset.

**Compensation of Directors**

Our directors who are not also our employees oremployees or principals of CD&R are compensated pursuant to our DirectorsCompensation Policy. Under this policy, such directors receive an annualretainer fee of $70,000, at least 50% of which is payable in shares (or rightsto acquire shares) of our common stock granted under the CDRV Investors, Inc.Stock Incentive Plan. Directors may elect to receive up to 100% of their annualretainer fee in shares or rights to acquire shares granted under the CDRVInvestors, Inc. Stock Incentive Plan.

Any director serving as the chair of any of thecommittees of our board of directors will receive an additional $10,000 annualcash retainer fee ($15,000 in the case of the chair of the audit committee ofour board of directors).

We do not pay anyadditional remuneration to any of our directors who are also our employees orwho are employees or principals of CD&R, however all such directors arereimbursed for reasonable travel and lodging expenses incurred to attendmeetings of our board of directors or a committee thereof.

100

----

**ITEM 12.**        SECURITYOWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDERMATTERS.

Thefollowing table lists all shares of our common stock beneficially owned by thefollowing holders as of March 24, 2006:

| **Name and Address of Beneficial Owner(1)** | ** ** | ** ** | ** ** | **Number** | ** ** | **Percent** | ** ** |
|----------------------------------------------------------------------|------------|------------|------------|------------|------------|-------------|------------|
| Clayton,  Dubilier & Rice Fund VI Limited Partnership(2)    |       | 4,200,000  |       |       | 71.80      |        |       |
| Banc of America  Capital Investors, L.P.(3)                          |       | 350,000    |       |       | 5.98       |        |       |
| John Ballbach (4)                                               |       | 19,643     |       |       | *          |        |       |
| Walter  Zywottek(5)                                                  |       | 0          |       |       | *          |        |       |
| Edward Orzetti(6)                                                    |       | 18,000     |       |       | *          |        |       |
| Jack  Wyszomierski(7)                                                |       | 14,000     |       |       | *          |        |       |
| Matthew  Malenfant(8)                                                |       | 4,900      |       |       | *          |        |       |
| Manuel  Brocke-Benz(9)                                               |       | 4,900      |       |       | *          |        |       |
| B. Charles  Ames(10)                                                 |       | 0          |       |       | *          |        |       |
| Joseph F.  Eckroth, Jr.(11)                                     |       | 1,919      |       |       | *          |        |       |
| Dr. Lewis S.  Edelheit                                          |       | 2,917      |       |       | *          |        |       |
| Brian P. Kelley                                                      |       | 1,833      |       |       | *          |        |       |
| Joseph L.  Rice, III(10)                                        |       | 0          |       |       | *          |        |       |
| James W.  Rogers(10)                                                 |       | 0          |       |       | *          |        |       |
| Axel Ruckert                                                         |       | 2,175      |       |       | *          |        |       |
| Richard J.  Schnall(10)                                              |       | 0          |       |       | *          |        |       |
| Carl T. Stocker                                                      |       | 3,417      |       |       | *          |        |       |
| Robert J.  Zollars(12)                                               |       | 4,333      |       |       | *          |        |       |
| All directors and  executive officers as a group (18 persons)        |       | 89,537     |       |       | 1.53       |        |       |

----

*                    Lessthan 1%

(1)          Inaccordance with Rule 13d-3 under the Exchange Act, as amended, aperson is deemed a “beneficial owner” of a security if he or she has or sharesthe power to vote or direct the voting of such security or the power to disposeor direct the disposition of such security. A person is also deemed to be abeneficial owner of any securities which that person has the right to acquirebeneficial ownership of within 60 days. More than one person may be deemed tobe a beneficial owner of the same securities. Each of such stockholders hassole voting and investment power as to the shares unless otherwise noted.

(2)          CD&RAssociates VI Limited Partnership, a Cayman Islands exempted limitedpartnership, is the general partner of CD&R Fund VI and has the power todirect CD&R Fund VI as to the voting and disposition of shares held byCD&R Fund VI. CD&R Investment Associates VI, Inc., a Cayman Islandexempted company, is the general partner of CD&R Associates VI LimitedPartnership and has the power to direct CD&R Associates VI LimitedPartnership as to its direction of CD&R Fund VI’s voting anddisposition of the shares held by CD&R Fund VI. No person controls thevoting and disposition of CD&R Investment Associates VI, Inc., withrespect to the shares owned by CD&R Fund VI. Each of CD&R Associates VILimited Partnership and CD&R Investment Associates VI, Inc.expressly disclaims beneficial ownership of the shares owned by CD&R FundVI. The business address for each of CD&R Fund VI, CD&R Associates VILimited Partnership and CD&R Investment Associates VI, Inc., is 1403Foulk Road, Suite 106, Wilmington, Delaware 19803.

(3)          Bancof America Capital Investors, L.P. is a Delaware limited partnership. Banc ofAmerica Capital Management, L.P., a Delaware limited partnership, is thegeneral partner of Banc of America Capital Investors, L.P. and has the power todirect Banc of America Capital Investors, L.P. as to the voting 

101

----

and disposition ofshares held by Banc of America Capital Investors, L.P. BACM I GP, LLC, aDelaware limited liability company, is the general partner of Banc of AmericaCapital Management L.P. and has the power to direct Banc of America CapitalManagement L.P. as to the voting and disposition of shares held by Banc ofAmerica Capital Management L.P. The business address for Banc of AmericaCapital Investors, L.P., Banc of America Capital Management, L.P. and BACM IGP, LLC, is Bank of America Corporate Center, 100 North Tryon Street, 25thFloor, Charlotte, NC 28255.

(4)          Mr. Ballbachpurchased 19,643 shares in March 2006 pursuant to the terms of his amendedemployment agreement. All shares were issued pursuant to the CDRV Investors, Inc.Stock Incentive Plan.

(5)          Allshares previously held by Mr. Zywottek were repurchased in connection withhis termination of employment in May 2005.

(6)          Inconnection with his termination of employment in February 2006, the 15,000shares previously held by Mr. Orzetti were repurchased. Mr. Orzetticurrently holds 18,000 vested options that may be exercised anytime until May 31,2006. All shares and options were issued pursuant to the CDRV Investors, Inc.Stock Incentive Plan.

(7)          Mr. Wyszomierskiowns 10,000 shares and has 4,000 options that are currently vested andexercisable. All shares and options were issued pursuant to the CDRV Investors, Inc.Stock Incentive Plan.

(8)          Mr. Malenfantowns 3,500 shares and has 1,400 options that are currently vested andexercisable. All shares and options were issued pursuant to the CDRV Investors, Inc.Stock Incentive Plan.

(9)          Mr. Brocke-Benzowns 3,500 shares and has 1,400 options that are currently vested andexercisable. All shares and options were issued pursuant to the CDRV Investors, Inc.Stock Incentive Plan.

(10)   Doesnot include 4,200,000 shares owned by Clayton Dubilier & Rice Fund VILimited Partnership. Messrs. Ames, Rice III, Rogers and Schnall may bedeemed to share beneficial ownership of the shares owned of record by ClaytonDubilier & Rice Fund VI Limited Partnership by virtue of their statusas stockholders of CD&R Investment Associates VI, Inc., the generalpartner of CD&R Associates VI Limited Partnership. However, each of Messrs. Ames,Rice III, Rogers and Schnall expressly disclaims beneficial ownership of theshares owned by Clayton Dubilier & Rice Fund VI Limited Partnership.

(11)   Includes1,090 shares that were purchased by Mr. Eckroth under the CDRV Investors, Inc.Stock Incentive Plan that were immediately transferred to a trust created forthe benefit of Mr. Eckroth’s family.

(12)   Includes2,500 shares that were purchased by Mr. Zollars under the CDRV Investors, Inc.Stock Incentive Plan and immediately transferred to a limited partnershipcontrolled by Mr. Zollars.

**ITEM13.**         CERTAINRELATIONSHIPS AND RELATED TRANSACTIONS

**InvestmentFund Managed by CD&R**

***Overview.***   Asof March 24, 2006, CD&R Fund VI beneficially owns approximately 71.8%of our outstanding common stock. CD&R Fund VI is a private investment fundmanaged by CD&R.

The general partner of CD&R Fund VI is CD&RAssociates VI Limited Partnership, a Cayman Islands exempted limitedpartnership. CD&R Associates VI Limited Partnership’s general partner isCD&R Investment Associates VI, Inc., a Cayman Islands exemptedcompany.

Four of our directors, B. Charles Ames, Joseph L. Rice, III,James W. Rogers and Richard J. Schnall, are principals of CD&R, limitedpartners (including a family trust of Mr. Ames) of CD&R Associates VILimited Partnership, and stockholders and directors of CD&R InvestmentAssociates VI, Inc.

102

----

CD&R is a private investment firm organized as a Delawarecorporation. CD&R is the manager of a series of investment funds, includingCD&R Fund VI. CD&R generally assists in structuring, arrangingfinancing for and negotiating the acquisition of the companies in which thefunds it manages invest. After the consummation of such transactions, CD&Rgenerally provides management and financial consulting services to thecompanies. Such services include helping companies to establish effectivebanking, legal and other business relationships and assisting management indeveloping and implementing strategies for improving their operational,marketing and financial performance.

***Stock PurchaseAgreement.***   In connection with theAcquisition, CD&R Fund VI and CDRV Acquisition Corporation entered intovarious agreements, including a stock purchase agreement, dated as of February 15,2004, with Merck KGaA, pursuant to which CDRV Acquisition Corporation andcertain of its affiliates agreed to purchase all of the outstanding capitalstock of VWR International Corporation, the holding company of VWRInternational, Inc., and 10% of the outstanding equity ownership interestsof VWR International Immobilien GmbH that we did not own. Pursuant to theseagreements, Merck KGaA agreed to not solicit certain of our employees for aperiod of two years following the completion of the Acquisition. Merck KGaAalso agreed to not act as a distributor of certain competitive laboratoryproducts, excluding certain products such as pharmaceutical products andingredients, in the laboratory field in North America and many Western Europeancountries, or own an interest in any such distributor, subject to certainownership exceptions. This restriction expires on the third anniversary of thecompletion of the Acquisition. CD&R Fund VI, on the other hand, agreed tonot sell any controlling interest in us or our business to any entity thatderives more than 10% of its total revenues from the manufacture, distributionand sale of chemical products for industrial or R&D uses. This restrictionexpires upon our initial public offering of voting securities. In addition, theparties agreed to certain indemnification obligations for breaches of theirrespective representations, warranties and covenants.

***ConsultingAgreement.***   CDRV Investors, Inc., CDRVHoldings, Inc., CDRV Acquisition Corporation and CD&R entered into aConsulting Agreement immediately prior to the Acquisition, pursuant to whichCD&R provides us with financial advisory and management consulting servicesfollowing the consummation of the Transactions. We pay CD&R a managementfee of $1.5 million annually, which will be reviewed on an annual basis. Wepaid CD&R a fee of $18.0 million as compensation for performing financial,investment banking, management advisory and other services in connection withthe Acquisition, and reimbursed certain CD&R expenses. Effective as of May 15,2005, the parties entered into a loanout agreement under the ConsultingAgreement whereby CD&R agreed to make the services of James W. Rogers, thecurrent Chairman of our Board and a CD&R employee, available to us. Themanagement fee payable to CD&R was increased by $0.5 million annually forthe period Mr. Rogers was our Chief Executive Officer, and $0.3 millionwas paid to CD&R in the year ended December 31, 2005 in connectiontherewith. The loanout agreement terminated pursuant to its terms upon theapproval of Mr. Ballbach’s employment as our Chief Executive Officer.

***IndemnificationAgreement.***   CDRV Investors, Inc., CDRVHoldings, Inc., CDRV Acquisition Corporation and their respectivesubsidiaries entered into an Indemnification Agreement with CD&R andCD&R Fund VI immediately prior to the Acquisition, pursuant to which,following the consummation of the Transactions, we would indemnify CD&R,CD&R Fund VI, any other investment vehicle managed by CD&R, theirrespective directors, officers, partners, employees, agents and controllingpersons, against certain liabilities arising under federal securities laws,liabilities arising out of the performance of the consulting agreement andcertain other claims and liabilities.

***Stock SubscriptionAgreement.***   As of March 24, 2006,CD&R Fund VI beneficially owns approximately 71.8% of our outstandingshares of common stock. It subscribed for 4,800,000 shares of CDRV Investors, Inc.’scommon stock for an aggregate purchase price of $480.0 million pursuant to a StockSubscription Agreement, dated as of April 7, 2004. Pursuant to thatagreement, CD&R Fund VI may designate all of the members of the Board ofDirectors of CDRV Investors, Inc. and certain of its direct and indirectsubsidiaries. CD&R is also entitled to consult with us with respect to ouroperations at any time, to have observers attend meetings of our Board ofDirectors and those of our subsidiaries, and to receive all of its quarterlyand annual financial reports and budgets, as well as other documents.

103

----

On June 22, 2004, CD&R Fund VI transferred anaggregate of 500,000 shares of our common stock to five of its limitedpartners, and on December 6, 2004, CD&R Fund VI transferred another100,000 shares of our common stock to another of its limited partners, pursuantto transfer agreements among the Company, CD&R Fund VI and each suchtransferee. Pursuant to the transfer agreements, transferees are entitled tothe rights and obligations of a minority stockholder under the Registration andParticipation Agreement, dated as of April 7, 2004, including the transferrestrictions, registration rights, tag-along rights and drag-along rightsthat are described below under the heading “—Agreement with Management andOther Investors—Registration and Participation Agreement.”

**Agreements with Management and Other Investors**

***Management EquityOfferings.***   Shortly after the completion ofthe Acquisition, we adopted the CDRV Investors, Inc. Stock Incentive Plan.Under the plan, certain of our officers and employees were offered theopportunity to purchase shares of our common stock and receive grants of optionsto purchase our common stock. We also offered our non-employee directors theopportunity to purchase shares of our common stock.

Pursuant to Mr. Ballbach’s amended employmentagreement described under the heading “Executive Compensation—Employment Agreementswith Named Executive Officers,” Mr. Ballbach purchased 19,643 shares ofour common stock during March 2006 pursuant to the plan. In connectionwith his purchase, he received a grant of 58,929 options under the plan. Mr. Ballbachwill also receive a grant of restricted stock units under the plan having atotal value of $500,000.

Wealso granted restricted stock units pursuant to the plan to Messrs. Wyszomierski,Malenfant, Leak and Brocke-Benz. The total value of Messrs. Wyszomierskiand Malenfant’s grants is $250,000 each, and the total value of Messrs. Leakand Brocke-Benz’s is $150,000 each.

At the time of Mr. Leak’s promotion to SeniorVice President of Category Management, he had a loan guaranteed by VWR inconnection with his purchase of shares of our common stock of approximately$200,000 that has since been repaid.

***Registration and Participation Agreement***

The Company, CD&R Fund VI and certain other of ourstockholders entered into a Registration and Participation Agreement, dated asof April 7, 2004, pursuant to which, among other things:

***TransferRestrictions.***   Until the earlier of theinitial public offering of our common stock and the fifth anniversary of theagreement, holders of our common stock other than CD&R Fund VI are subjectto certain restrictions on transfer.

***Registration Rights.***   Holdersof shares of our common stock, including certain executive officers, areentitled to registration rights for such shares of common stock held by them:

·       holdersconstituting, at any time prior to the initial public offering of our commonstock , at least 50% and thereafter, at least 25%, of the total registrablesecurities may request that we use our best efforts to register such securitiesfor public resale,

·       followingthe initial public offering of our common stock , under specified circumstances(and if we have qualified for registration on Form S-3), certainholders other than CD&R Fund VI may request that we use our best efforts toregister their shares of our common stock for public resale on Form S-3,and

·       ifthe Company registers any common stock at any time, either for our account orfor the account of any stockholder, the holders of registrable securities areentitled to request that we use our best efforts to include the number of theirshares of common stock that, in the opinion of the underwriters, can be sold.

104

----

The Company will bear all registration expenses (otherthan underwriting discounts) for the first four registrations, including thefees and expenses of counsel to the selling stockholders. Because only CD&RFund VI holds more than 50% of its outstanding common stock, it is the onlystockholder able to initiate the initial registration by itself. The Companyalso will bear the registration expenses (other than underwriting discounts)for two registrations on Form S-3 requested by certain co-investorsof CD&R Fund VI, including the fees and expenses of counsel to the sellingstockholders.

If the Company files a registration statement underthe Securities Act with respect to a public offering of its common stock, noholders of our common stock will be permitted to effect any public sale ordistribution of any shares of such stock during the 20 days before and the 180days (or, in the case of a shelf registration, 90 days) after the effectivedate of the registration statement (other than as part of the public offering).

***Participation Rights*****.**   Prior to the initial public offering of the Company,certain holders of our common stock have the right to purchase, on a pro ratabasis, additional shares of our common stock if CD&R Fund VI or any otherinvestment vehicle managed by CD&R subscribes for additional shares ofcommon stock, excluding any issuances by way of dividends or distributions onin kind, or stock splits, reclassifications, recapitalizations orconsolidations.

***Tag-Along Rights*****.**   Priorto such time as a public market has been established for 20% or more of ourcommon stock, certain holders of our common stock other than CD&R Fund VIhave the right to participate, on a pro rata basis and subject to the sameterms and conditions, in any sale by CD&R Fund VI of more than 10% of itsshares of common stock to a third party purchaser or to the Company.

***Drag-Along Rights***.   Priorto such time as a public market has been established for 20% or more ofour  common stock, if CD&R Fund VIintends to sell more than 50% of its shares of our common stock to a thirdparty purchaser, CD&R Fund VI will have the right to require certain otherholders of common stock to participate in such sale, on a pro rata basis andsubject to the same terms and conditions.

**ITEM14.**         PRINCIPAL ACCOUNTANT FEESAND SERVICES

KPMG LLP served as theCompany’s independent auditor for the fiscal years ended December 31, 2005and 2004. Fees and expenses for services rendered by KPMG in 2005 and 2004 wereapproved by our Audit Committee. KPMG’s fees and expenses for services renderedto the Company for the past two fiscal years are set forth in the table below. Wehave determined that the provision of these services is compatible withmaintaining the independence of our independent auditors.

| **Type of Fees**       | ** ** | ** **                 | ** ** | **2005** | ** ** | **2004** | ** ** |
|------------------------|------------|----------------------------|------------|----------|------------|----------|------------|
| ** **             |       | **(dollars in thousands)** |       |
| Audit Fees(1)          |       | $2,158                     |       | $1,785   |       |
| Audit-Related  Fees(2) |       | 88                         |       | 795      |       |
| Tax Fees(3)            |       | 52                         |       | 30       |       |
| TOTAL FEES             |       | $2,298                     |       | $2,610   |       |

----

(1)          2005 and 2004 audit feesrelate to the audit of the Company’s global operations including statutoryaudits. Also included herein are fees related to various employee benefit planaudits.

(2)          2005audit-related services include procedures performed in connection with the CDRVInvestors registration statement on Form S-4. 2004 audit-relatedservices include procedures performed in connection with the April 2004VWR International Offering Memorandum, the VWR International registrationstatement on Form S-4 and the December 2004 Offering Memorandumfor the Senior Discount Notes.

(3)          Fees for both yearsrelate to tax compliance services.

105

----

**Pre-Approval Policyfor Auditor Services**

The Audit Committee has adopted a policy that requiresit to pre-approve the audit and non-audit services performed by the Company’sauditor in order to assure that providing such services will not impair theauditor’s independence.

The Audit Committee has the sole and direct responsibilityand authority for the appointment, termination and compensation to be paid tothe independent accountants. The Committee has the responsibility to approve,in advance of the provision thereof, all audit services and permissiblenon-audit services to be performed by the independent accountants as well ascompensation to be paid with respect to such services.

Our Audit Committee Charter authorizes the Committeeto delegate authority to pre-approve audit and permissible non-audit servicesto a member of the Committee. Any decisions made by such member under delegatedauthority, must be presented to the full Committee at its next scheduledmeeting.

**PART IV**

**ITEM15.**         EXHIBITS AND FINANCIALSTATEMENT SCHEDULES

a.                 Financialstatements, financial statement schedule and exhibits filed as part of thisreport

1.              The followingfinancial statements, together with the Report of Independent Registered PublicAccountants and Notes to Consolidated Financial Statements, are filed as partof this report:

| ** **                                                                                                                                                                                                                                       | ** ** | **Page** | ** ** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|----------|------------|
| **CDRV Investors, Inc.  (Successor) and VWR International Corporation (Predecessor)**                                                                                                                                                       |       |     |       |   |   |
| Report of Independent Registered Public Accounting  Firm                                                                                                                                                                                         |       |     | 41         |   |   |
| Consolidated  Balance Sheets as of December 31, 2005 and 2004                                                                                                                                                                               |       |     | 42         |   |   |
| Consolidated Statements of Operations for the year  ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003                                                       |       |     | 43         |   |   |
| Consolidated Statements of Stockholders’ Equity and  other Comprehensive Income (Loss) for the year ended December 31, 2005,  the periods included in the year ended December 31, 2004 and the year  ended December 31, 2003 |       |     | 44         |   |   |
| Consolidated Statements of Cash Flows for the year  ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003                                                       |       |     | 46         |   |   |
| Notes to Consolidated Financial Statements                                                                                                                                                                                                       |       |     | 47         |   |   |
| Schedule II—Valuation and Qualifying Accounts for the  year ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003.                                         |       |     | 115        |   |   |

 

106

----

 

| Exhibit    Number | ** ** | **Description of Documents**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | ** ** | **Method of Filing**                                                                                                    |
|------------------------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|-------------------------------------------------------------------------------------------------------------------------|
| 3.1                    |       | Certificate of Incorporation of CDRV  Investors, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |       | Previously filed as Exhibit 3.1 to Form S-4,  filed on April 15, 2005.                                   |
| 3.2                    |       | Amended and Restated Bylaws of CDRV  Investors, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |       | Previously filed as Exhibit 3.2 to Form S-4,  filed on April 15, 2005.                                   |
| 4.1                    |       | Credit Agreement, dated as of April 7, 2004,  among CDRV Acquisition Corporation (the rights and obligations of which  thereunder were assumed by VWR International, Inc.), the Foreign  Subsidiary Borrowers from time to time parties thereto, the several Lenders  from time to time parties thereto, Deutsche Bank AG, New York Branch, as  Administrative Agent, Citicorp North America, Inc., as Syndication  Agent, and Bank of America, N.A., BNP Paribas and Barclays Bank PLC, as  Documentation Agents. |       | Previously filed as Exhibit 4.1 to the VWR  International, Inc. Form S-4, filed on August 30, 2004. |
| 4.2                    |       | Assumption Agreement, dated as of April 7,  2004, between CDRV Acquisition Corporation and VWR International, Inc.                                                                                                                                                                                                                                                                                                                                                                                                      |       | Previously filed as Exhibit 4.2 to the VWR  International, Inc. Form S-4, filed on August 30, 2004. |
| 4.3                    |       | Guarantee and Collateral Agreement, dated as of  April 7, 2004, made by CDRV Holdings, Inc., CDRV Acquisition  Corporation (the rights and obligations of which were assumed by VWR  International, Inc.) and certain of its Subsidiaries in favor of  Deutsche Bank AG, New York Branch, as Administrative Agent.                                                                                                                                                                                                 |       | Previously filed as Exhibit 4.3 to the VWR  International, Inc. Form S-4, filed on August 30, 2004. |
| 4.4                    |       | Indenture, dated as of December 16, 2004, by  and among CDRV Investors, Inc., as Issuer, the Subsidiary Guarantors  from time to time parties thereto, as Subsidiary Guarantors and Wells Fargo  Bank, National Association, as Trustee, relating to 9 5/8% Senior Discount Notes due  2015 of CDRV Investors, Inc.                                                                                                                                                                                                |       | Previously filed as Exhibit 4.4 to Form S-4,  filed on April 15, 2005.                                   |
| 4.5                    |       | Form of 9 5/8% Senior Discount Notes due  2015 of CDRV Investors, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                  |       | Previously filed as Exhibit 4.6 to Form S-4,  filed on April 15, 2005.                                   |
| 4.6                    |       | Indenture, dated as of April 7, 2004, by and  among CDRV Acquisition Corporation, as Issuer, the Subsidiary Guarantors from  time to time parties thereto, as Subsidiary Guarantors and Wells Fargo Bank,  National Association, as Trustee, relating to the 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.                                                                                                                                                                                              |       | Previously filed as Exhibit 4.4 to the VWR  International, Inc. Form S-4, filed on August 30, 2004. |

107

----

 

| 4.7  |   | Indenture, dated as of April 7, 2004, by and  among CDRV Acquisition Corporation, as Issuer, the Subsidiary Guarantors from  time to time parties thereto, as Subsidiary Guarantors and Wells Fargo Bank,  National Association, as Trustee, relating to the 8% Senior Subordinated  Notes due 2014 of CDRV Acquisition Corporation. |   | Previously filed as Exhibit 4.5 to the VWR  International, Inc. Form S-4, filed on August 30, 2004.                             |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|
| 4.8  |   | Supplemental Indenture, dated as of April 7,  2004, among VWR International, Inc. and Wells Fargo Bank, National  Association, as Trustee, relating to the 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.                                                                                                   |   | Previously filed as Exhibit 4.6 to the VWR  International, Inc. Form S-4, filed on August 30, 2004.                             |
| 4.9  |   | Supplemental Indenture, dated as of April 7,  2004, among VWR International, Inc., and Wells Fargo Bank, National  Association, as Trustee, relating to the 8% Senior Subordinated Notes due  2014 of CDRV Acquisition Corporation.                                                                                             |   | Previously filed as Exhibit 4.7 to the VWR  International, Inc. Form S-4, filed on August 30, 2004.                             |
| 4.10 |   | Supplemental Indenture, dated as of April 7,  2004, among VWR International, Inc. and Wells Fargo Bank, National  Association, as Trustee, relating to the 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.                                                                                                   |   | Previously filed as Exhibit 4.12 to Amendment  No. 2 to the VWR International, Inc. Form S-4, filed on November 19,  2004. |
| 4.11 |   | Supplemental Indenture, dated as of April 7,  2004, among VWR International, Inc. and Wells Fargo Bank, National  Association, as Trustee, relating to the 8% Senior Subordinated Notes due  2014 of CDRV Acquisition Corporation.                                                                                              |   | Previously filed as Exhibit 4.13 to Amendment  No. 2 to the VWR International, Inc. Form S-4, filed on  November 19, 2004. |
| 4.12 |   | Form of 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.                                                                                                                                                                                                                                                           |   | Previously filed as  Exhibit 4.10 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.                           |
| 4.13 |   | Form of 8% Senior  Subordinated Notes due 2014 of CDRV Acquisition Corporation.                                                                                                                                                                                                                                                      |   | Previously filed as  Exhibit 4.11 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.                           |
| 10.1 |   | Consulting Agreement,  dated as of April 7, 2004, by and among CDRV Investors, Inc., CDRV  Holdings, Inc., CDRV Acquisition Corporation, CDRV Delaware, Inc.  and Clayton, Dubilier & Rice, Inc.                                                                                                        |   | Previously filed as  Exhibit 10.1 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.                           |
| 10.2 |   | Loanout Agreement, dated  as of May 15, 2005, by and among CDRV Investors, Inc., CDRV  Holdings, Inc., VWR International, Inc. and Clayton,  Dubilier & Rice, Inc.                                                                                                                                      |   | Previously filed as  Exhibit 99.1 to the VWR International, Inc. Form 8-K,  filed on May 15, 2005.                              |

108

----

 

| 10.3  |   | Indemnification Agreement, dated as of April 7,  2004, among CDRV Investors, Inc., CDRV Holdings, Inc., CDRV  Acquisition Corporation, CDRV Delaware, Inc., Clayton,  Dubilier & Rice, Inc. and Clayton, Dubilier & Rice  Fund VI Limited Partnership.    |   | Previously filed as Exhibit 10.2 to the VWR  International, Inc. Form S-4, filed on August 30, 2004.    |
|-------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------|
| 10.4  |   | Registration and  Participation Agreement, dated as of April 7, 2004, among CDRV  Investors, Inc., Clayton, Dubilier & Rice Fund VI Limited  Partnership, Banc of America Capital Investors, L.P., SSB Capital Partners  (Master Fund) I, L.P., and CGI Private Equity L.P., LLC. |   | Previously filed  as Exhibit 10.3 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.   |
| 10.5  |   | Stock Subscription  Agreement, dated April 7, 2004, between CDRV Investors, Inc. and  Clayton, Dubilier & Rice Fund VI Limited Partnership.                                                                                                                                       |   | Previously filed as  Exhibit 10.4 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.   |
| 10.6  |   | VWR  International, Inc. Directors Compensation Policy*                                                                                                                                                                                                                                         |   | Previously filed as  Exhibit 10.5 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.   |
| 10.7  |   | CDRV  Investors, Inc. Stock Incentive Plan*                                                                                                                                                                                                                                                     |   | Previously filed as  Exhibit 10.6 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.   |
| 10.8  |   | Form of Employee  Stock Subscription Agreement*                                                                                                                                                                                                                                                 |   | Previously filed as  Exhibit 10.7 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.   |
| 10.9  |   | Form Restricted  Stock Unit Agreement under CDRV Investors, Inc. Stock Incentive Plan*                                                                                                                                                                                                     |   | Previously filed as  Exhibit 99.2 to the VWR International, Inc. Form 8-K,  filed on February 23, 2006. |
| 10.10 |   | Form of Stock  Option Agreement*                                                                                                                                                                                                                                                                |   | Previously filed as  Exhibit 10.8 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.   |
| 10.11 |   | Pension Contract for  Walter Zywottek*                                                                                                                                                                                                                                                               |   | Previously filed as  Exhibit 10.9 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.   |
| 10.12 |   | VWR  International, Inc. Retirement Plan*                                                                                                                                                                                                                                                       |   | Previously filed as  Exhibit 10.10 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.  |
| 10.13 |   | VWR Corporation  Supplemental Benefits Plan*                                                                                                                                                                                                                                                         |   | Previously filed as  Exhibit 10.11 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.  |
| 10.14 |   | Employment Agreement,  among VWR International, Inc and John M. Ballbach.*                                                                                                                                                                                                                           |   | Previously filed as  Exhibit 99.2 to the VWR International, Inc. Form 8-K,  filed on October 19, 2005.  |
| 10.15 |   | Amendment to Employment  Agreement among VWR International, Inc. and John Ballbach*                                                                                                                                                                                                             |   | Previously filed as  Exhibit 99.1 to the VWR International, Inc. Form 8-K,  filed on February 23, 2006. |

109

----

 

| 10.16 |   | Employment  Agreement, among VWR International, Inc. and Walter Zywottek*                                                |   | Previously filed  as Exhibit 10.12 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.      |
|-------|--------|-------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------|
| 10.17 |   | Employment Agreement,  among VWR International, Inc. and Jack Wyszomierski*                                              |   | Previously filed as  Exhibit 10.13 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.      |
| 10.18 |   | Employment Agreement,  among VWR International, Inc. and Edward H. Orzetti*                                              |   | Previously filed as  Exhibit 10.14 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.      |
| 10.19 |   | Letter Agreement, among  VWR International, Inc. and Edward Orzetti.*                                                    |   | Previously filed as  Exhibit 99.1 to the VWR International, Inc. Form 8-K,  filed on January 11, 2006.      |
| 10.20 |   | Employment Agreement,  among VWR International, Inc. and Charles F. Canfield*                                            |   | Previously filed as  Exhibit 10.17 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.      |
| 10.21 |   | Employment Agreement,  among VWR International, Inc. and Ted Pulkownik*                                                  |   | Previously filed as  Exhibit 10.18 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.      |
| 10.22 |   | Employment Agreement,  among VWR International, Inc. and Stephen J. Kunst*                                               |   | Previously filed as  Exhibit 10.19 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.      |
| 10.23 |   | Letter of Employment for  Stephen J. Kunst*                                                                                   |   | Previously filed as  Exhibit 10.20 to the VWR International, Inc. Form S-4,  filed on August 30, 2004.      |
| 12.1  |   | Computation of Ratio of  Earnings to Fixed Charges.                                                                           |   | Filed herewith.                                                                                                                 |
| 21.1  |   | List of subsidiaries.                                                                                                         |   | Previously filed as  Exhibit 21.1 to Form S-4, filed on April 15, 2005. **[Does this list need to be updated?]** |
| 31.1  |   | Certification of  Principal Executive Officer pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                |   | Filed herewith.                                                                                                                 |
| 31.2  |   | Certification of  Principal Financial Officer pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                |   | Filed herewith.                                                                                                                 |
| 32.1  |   | Certificate of Principal  Executive Officer pursuant to 18 U.S.C. 1350 (Section 906 of the  Sarbanes-Oxley Act of 2002). |   | Furnished herewith.                                                                                                             |
| 32.2  |   | Certificate of Principal  Financial Officer pursuant to 18 U.S.C. 1350 (Section 906 of the  Sarbanes-Oxley Act of 2002). |   | Furnished herewith.                                                                                                             |

 

----

*                    Denotesmanagement contract or compensatory plan, contract or arrangement.

**SUPPLEMENTALINFORMATION**

No annual report to security holders covering theCompany’s last fiscal year or proxy statement, form of proxy or other proxysoliciting material has been sent to security holders.

110

----

Pursuantto the requirements of Sections 13 or 15(d) of the Securities Exchange Actof 1934, the registrant has duly caused this report to be signed on its behalfby the undersigned, thereunto duly authorized.

|        |     |   | CDRV INVESTORS, INC. |
|--------|----------|--------|---------------------------|
|   |     |   | By:                       | /s/ JACK L. WYSZOMIERSKI |
|   |     |   | Name:                     |   Jack L. Wyszomierski |
|   | * * |   | Title:                    | *Executive Vice President and Chief Financial  Officer* |
|   |     |   | March 31, 2006       |
|        |          |        |                           |  |  |

 

Pursuantto the requirements of the Securities Exchange Act of 1934, this report hasbeen signed by the following persons on behalf of the registrant and in thecapacities and on the dates indicated.

| ** **                      | **Signature** | ** **                   | ** ** | ** **          | **Title** | ** ** | ** ** | ** ** | ** ** | ** ** |
|---------------------------------|---------------|------------------------------|------------|---------------------|-----------|------------|------------|------------|------------|------------|
| /s/ JOHN M. BALLBACH            |          | President, Chief Executive   |       | March 31, 2006 |
| John M. Ballbach                |          | Officer  and Director        |       |                |
| /s/ JACK L. WYSZOMIERSKI        |          | Executive Vice President and |       | March 31, 2006 |
| Jack L. Wyszomierski            |          | Chief  Financial Officer     |       |                |
| /s/ B. CHARLES AMES             |          | Director                     |       | March 31, 2006 |
| B. Charles Ames                 |          |                         |       |                |
| /s/ JOSEPH F. ECKROTH, JR. |          | Director                     |       | March 31, 2006 |
| Joseph F. Eckroth, Jr.     |          |                         |       |                |
| /s/ LEWIS S. EDELHEIT           |          | Director                     |       | March 31, 2006 |
| Lewis S. Edelheit               |          |                         |       |                |
| /s/ BRIAN P. KELLEY             |          | Director                     |       | March 31, 2006 |
| Brian P. Kelley                 |          |                         |       |                |
| /s/ JOSEPH L. RICE, III    |          | Director                     |       | March 31, 2006 |
| Joseph L. Rice, III        |          |                         |       |                |
| /s/ JAMES W. ROGERS             |          | Chairman                     |       | March 31, 2006 |
| James W. Rogers                 |          |                         |       |                |
| /s/ AXEL RUCKERT                |          | Director                     |       | March 31, 2006 |
| Axel Ruckert                    |          |                         |       |                |
| /s/ RICHARD J. SCHNALL          |          | Director                     |       | March 31, 2006 |
| Richard J. Schnall              |          |                         |       |                |
| /s/ CARL T. STOCKER             |          | Director                     |       | March 31, 2006 |
| Carl T. Stocker                 |          |                         |       |                |
| /s/ ROBERT J. ZOLLARS           |          | Director                     |       | March 31, 2006 |
| Robert J. Zollars               |          |                         |       |                |

 

 

111

----

**Schedule II - Valuation of Qualifying Accounts**

**CDRVINVESTORS, INC.Year ended December 31, 2005 and for the period April 7 - December 31,2004(Dollars in millions)**

| ** **                                   | ** ** | ** **          | ** ** | ** **         | ** ** | **Foreign**     | ** ** | ** **            | ** ** | ** **          | ** ** |
|----------------------------------------------|------------|---------------------|------------|--------------------|------------|-----------------|------------|-----------------------|------------|---------------------|------------|
| ** **                                   | ** ** | **Balance at** | ** ** | ** **         | ** ** | **Currency**    | ** ** | **Deductions**        | ** ** | **Balance at** | ** ** |
| ** **                                   | ** ** | **Beginning**       | ** ** | **Charged**        | ** ** | **Translation** | ** ** | **From**              | ** ** | **End**             | ** ** |
| ** **                                   | ** ** | **of Period**  | ** ** | **to Income** | ** ** | **Adjustments** | ** ** | **Reserves (1)** | ** ** | **of Period**  | ** ** |
| Year ended  December 31, 2005           |       |                |       |               |       |            |       |                  |       |                |       |   |   |   |   |   |   |   |   |   |   |
| Allowance for doubtful receivables           |       |                | $          | 6.0                |       |            |       | $                     | 3.2        |                |       |   | $ | (0.4 | ) |   |   | $ | (2.2 | ) |   |   | $ | 6.6 |   |   |
| April 7, 2004 -  December 31, 2004 |       |                |       |               |       |            |       |                  |       |                |       |   |   |   |   |   |   |   |   |   |   |
| Allowance for  doubtful receivables          |       |                | $          | 7.4                |       |            |       | $                     | 2.5        |                |       |   | $ | 0.4 |   |   |   | $ | (4.3 | ) |   |   | $ | 6.0 |   |   |

 

**VWRINTERNATIONAL CORPORATIONFor the period January 1 - April 6, 2004 and the year ended December 31,2003(Dollars in millions)**

| ** **                           | ** ** | ** **          | ** ** | ** **         | ** ** | **Foreign**     | ** ** | ** **            | ** ** | ** **          | ** ** |
|--------------------------------------|------------|---------------------|------------|--------------------|------------|-----------------|------------|-----------------------|------------|---------------------|------------|
| ** **                           | ** ** | **Balance at** | ** ** | ** **         | ** ** | **Currency**    | ** ** | **Deductions**        | ** ** | **Balance at** | ** ** |
| ** **                           | ** ** | **Beginning**       | ** ** | **Charged**        | ** ** | **Translation** | ** ** | **From**              | ** ** | **End**             | ** ** |
| ** **                           | ** ** | **of Period**  | ** ** | **to Income** | ** ** | **Adjustments** | ** ** | **Reserves (1)** | ** ** | **of Period**  | ** ** |
| January 1 -  April 6, 2004 |       |                |       |               |       |            |       |                  |       |                |       |   |   |   |   |   |   |   |   |   |   |
| Allowance for doubtful receivables   |       |                | $          | 7.8                |       |            |       | $                     | 0.6        |                |       |   | $ | (0.1 | ) |   |   | $ | (0.9 | ) |   |   | $ | 7.4 |   |   |
| Year ended  December 31, 2003   |       |                |       |               |       |            |       |                  |       |                |       |   |   |   |   |   |   |   |   |   |   |
| Allowance for  doubtful receivables  |       |                | 4.2        |               |       |            | 4.0        |                  |       |                | 0.6        |   |   |   | (1.0 | ) |   |   | 7.8 |   |   |
|                                      |            |                     |            |                    |            |                 |            |                       |            |                     |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

----

(1)          Bad debts charged off,less recoveries.

112

----