exv10w3



 




Exhibit 10.3




AGREEMENT




Dated as of May 3, 2005,




Among




FRESENIUS MEDICAL CARE AG,




FRESENIUS MEDICAL CARE HOLDINGS, INC.




FLORENCE ACQUISITION, INC.




And




RENAL CARE GROUP, INC.








 




TABLE OF CONTENTS




	 	 	 	 	 	 	 
	 	 	 	 	Page	
	 	 	 	 	 	
	
    ARTICLE I

    The Merger
	
    
    SECTION 1.01.

    	 	
    The Merger	 	 	1	 
	
    
    SECTION 1.02.

    	 	
    Closing	 	 	1	 
	
    
    SECTION 1.03.

    	 	
    Effective Time	 	 	1	 
	
    
    SECTION 1.04.

    	 	
    Effects	 	 	1	 
	
    
    SECTION 1.05.

    	 	
    Certificate of Incorporation and By-laws	 	 	1	 
	
    
    SECTION 1.06.

    	 	
    Directors	 	 	2	 
	
    
    SECTION 1.07.

    	 	
    Officers	 	 	2	 
	 
	
    ARTICLE II

    Effect on the Capital Stock of the Constituent Corporations;

    Exchange of Certificates
	
    
    SECTION 2.01.

    	 	
    Effect on Capital Stock	 	 	2	 
	
    
    SECTION 2.02.

    	 	
    Exchange of Certificates	 	 	3	 
	 
	
    ARTICLE III

    Representations and Warranties of Rome
	
    
    SECTION 3.01.

    	 	
    Organization, Standing and Power	 	 	4	 
	
    
    SECTION 3.02.

    	 	
    Rome Subsidiaries; Equity Interests	 	 	5	 
	
    
    SECTION 3.03.

    	 	
    Capital Structure	 	 	5	 
	
    
    SECTION 3.04.

    	 	
    Authority; Execution and Delivery; Enforceability	 	 	6	 
	
    
    SECTION 3.05.

    	 	
    No Conflicts; Consents	 	 	7	 
	
    
    SECTION 3.06.

    	 	
    SEC Documents; Undisclosed Liabilities	 	 	8	 
	
    
    SECTION 3.07.

    	 	
    Information Supplied	 	 	8	 
	
    
    SECTION 3.08.

    	 	
    Absence of Certain Changes or Events	 	 	9	 
	
    
    SECTION 3.09.

    	 	
    Taxes	 	 	9	 
	
    
    SECTION 3.10.

    	 	
    Absence of Changes in Benefit Plans	 	 	10	 
	
    
    SECTION 3.11.

    	 	
    ERISA Compliance; Excess Parachute Payments	 	 	11	 
	
    
    SECTION 3.12.

    	 	
    Litigation	 	 	13	 
	
    
    SECTION 3.13.

    	 	
    Compliance with Applicable Laws	 	 	13	 
	
    
    SECTION 3.14.

    	 	
    Environmental Matters	 	 	13	 
	
    
    SECTION 3.15.

    	 	
    Contracts	 	 	14	 
	
    
    SECTION 3.16.

    	 	
    Intellectual Property	 	 	14	 
	
    
    SECTION 3.17.

    	 	
    Assets	 	 	15	 
	
    
    SECTION 3.18.

    	 	
    Brokers	 	 	15	 
	
    
    SECTION 3.19.

    	 	
    Opinion of Financial Advisor	 	 	15	 
	
    
    SECTION 3.20.

    	 	
    Fraud and Abuse Stark; False Claims; HIPAA; Medicare Program	 	 	15	 












 




	 	 	 	 	 	 	 
	 	 	 	 	Page	
	 	 	 	 	 	
	 
	
    ARTICLE IV

    Representations and Warranties of the Florence Parties
	
    
    SECTION 4.01.

    	 	
    Organization, Standing and Power	 	 	16	 
	
    
    SECTION 4.02.

    	 	
    Sub	 	 	16	 
	
    
    SECTION 4.03.

    	 	
    Authority; Execution and Delivery; Enforceability	 	 	17	 
	
    
    SECTION 4.04.

    	 	
    No Conflicts; Consents	 	 	17	 
	
    
    SECTION 4.05.

    	 	
    Information Supplied	 	 	17	 
	
    
    SECTION 4.06.

    	 	
    Brokers	 	 	18	 
	
    
    SECTION 4.07.

    	 	
    Financing	 	 	18	 
	
    ARTICLE V

    Covenants Relating to Conduct of Business
	
    
    SECTION 5.01.

    	 	
    Conduct of Business	 	 	18	 
	
    
    SECTION 5.02.

    	 	
    No Solicitation	 	 	21	 
	
    ARTICLE VI

    Additional Agreements
	
    
    SECTION 6.01.

    	 	
    Preparation of Proxy Statement; Stockholders Meeting	 	 	23	 
	
    
    SECTION 6.02.

    	 	
    Access to Information; Confidentiality	 	 	24	 
	
    
    SECTION 6.03.

    	 	
    Standard of Efforts; Notification	 	 	24	 
	
    
    SECTION 6.04.

    	 	
    Stock Options	 	 	26	 
	
    
    SECTION 6.05.

    	 	
    Benefit Plans	 	 	27	 
	
    
    SECTION 6.06.

    	 	
    Indemnification	 	 	28	 
	
    
    SECTION 6.07.

    	 	
    Fees and Expenses	 	 	29	 
	
    
    SECTION 6.08.

    	 	
    Public Announcements	 	 	30	 
	
    
    SECTION 6.09.

    	 	
    Transfer Taxes	 	 	30	 
	
    
    SECTION 6.10.

    	 	
    Rights Agreements	 	 	30	 
	
    
    SECTION 6.11.

    	 	
    Florence Parties’ Acknowledgement	 	 	30	 
	
    ARTICLE VII

    Conditions Precedent
	
    
    SECTION 7.01.

    	 	
    Conditions to Each Party’s Obligation To Effect The Merger	 	 	30	 
	
    
    SECTION 7.02.

    	 	
    Conditions to Obligations of the Florence Parties	 	 	30	 
	
    
    SECTION 7.03.

    	 	
    Conditions to Obligations of Rome	 	 	31	 
	
    ARTICLE VIII

    Termination, Amendment and Waiver
	
    
    SECTION 8.01.

    	 	
    Termination	 	 	32	 
	
    
    SECTION 8.02.

    	 	
    Effect of Termination	 	 	33	 
	
    
    SECTION 8.03.

    	 	
    Amendment	 	 	33	 
	
    
    SECTION 8.04.

    	 	
    Extension; Waiver	 	 	33	 




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	 	 	 	 	Page	
	 	 	 	 	 	
	 
	
    ARTICLE IX

    General Provisions
	
    
    SECTION 9.01.

    	 	
    Nonsurvival of Representations and Warranties	 	 	33	 
	
    
    SECTION 9.02.

    	 	
    Notices	 	 	33	 
	
    
    SECTION 9.03.

    	 	
    Definitions	 	 	34	 
	
    
    SECTION 9.04.

    	 	
    Interpretation	 	 	35	 
	
    
    SECTION 9.05.

    	 	
    Severability	 	 	35	 
	
    
    SECTION 9.06.

    	 	
    Counterparts	 	 	35	 
	
    
    SECTION 9.07.

    	 	
    Entire Agreement; No Third-Party Beneficiaries	 	 	35	 
	
    
    SECTION 9.08.

    	 	
    Governing Law	 	 	35	 
	
    
    SECTION 9.09.

    	 	
    Assignment	 	 	35	 
	
    
    SECTION 9.10.

    	 	
    Enforcement	 	 	35	 
	
    
    SECTION 9.11.

    	 	
    Construction	 	 	35	 




iii






 






		
	 	     
    AGREEMENT dated as of May 3, 2005, among




FRESENIUS MEDICAL CARE AG, a corporation organized under the
laws of the Federal Republic of Germany (“FME
AG”),




FRESENIUS MEDICAL CARE HOLDINGS, INC., a New York corporation,
and a wholly owned subsidiary of FME AG (“FME”),




FLORENCE ACQUISITION, INC., a Delaware corporation, and a wholly
owned subsidiary of FME (“Sub”), and




RENAL CARE GROUP, INC., a Delaware corporation
(“Rome”).



     
WHEREAS the respective boards of directors of FME, Sub and Rome
have approved the merger (the “Merger”) of Sub
into Rome on the terms and subject to the conditions set forth
in this Agreement, whereby each issued and outstanding share of
common stock, par value $0.01 per share, of Rome (the
“Rome Common Stock”) not owned by FME, Sub or
Rome shall be converted into the right to receive the Merger
Consideration (as defined in Section 2.01);



     
WHEREAS the Supervisory Board of Directors and Managing Board of
Directors of FME AG have approved the Merger and the other
transactions contemplated by this Agreement (collectively, the
“Transactions”) on the terms and subject to the
conditions of this Agreement; and



     
WHEREAS FME AG, FME, and Sub (collectively, the
“Florence Parties”) and Rome desire to make
certain representations, warranties, covenants and agreements in
connection with the Merger and the other Transactions and also
to prescribe various conditions to the Merger and the other
Transactions.



     
NOW, THEREFORE, the parties hereto agree as follows:




ARTICLE I




The Merger



     
SECTION 1.01. The Merger. On the terms and subject to the
conditions set forth in this Agreement, and in accordance with
the Delaware General Corporation Law (the
“DGCL”), Sub shall be merged with and into Rome
at the Effective time (as defined in Section 1.03). At the
Effective Time, the separate corporate existence of Sub shall
cease, and Rome shall continue as the surviving corporation (the
“Surviving Corporation”).



     
SECTION 1.02. Closing. The closing (the
“Closing”) of the Merger shall take place at
the offices of Sonnenschein Nath & Rosenthal LLP, 1221
Avenue of the Americas, New York, New York 10020 at
10:00 a.m., on the second business day following the date
on which all the conditions set forth in Article VII have
been satisfied (or, to the extent permitted by Law (as defined
in Section 3.05(a)), waived by the party or parties entitled to
the benefits thereof), or at such other place, time and date as
shall be agreed in writing between FME and Rome. The date on
which the Closing occurs is referred to in this Agreement as the
“Closing Date”.



     
SECTION 1.03. Effective Time. Prior to the Closing, the
parties shall prepare, and on the Closing Date or as soon as
practicable thereafter shall file with the Secretary of State of
the State of Delaware, a certificate of merger or other
appropriate documents (in any such case, the
“Certificate of Merger”) executed in accordance
with the relevant provisions of the DGCL and shall make all
other filings or recordings required under the DGCL. The Merger
shall become effective at such time as the Certificate of Merger
is duly filed with such Secretary of State, or at such later
time as is permitted by the DGCL and as FME and Rome shall agree
and specify in the Certificate of Merger (the time the Merger
becomes effective being the “Effective Time”).



     
SECTION 1.04. Effects. The Merger shall have the effects
set forth in Section 259 of the DGCL.



     
SECTION 1.05. Certificate of Incorporation and By-laws.
(a) The Certificate of Incorporation of Rome shall be
amended at the Effective Time to read in the form of
Exhibit A, and, as so amended, such Certificate of
Incorporation shall be the Certificate of Incorporation of the
Surviving Corporation until thereafter changed or amended as
provided therein or by applicable Law.



1







 



     
(b) The By-laws of Sub as in effect immediately prior to
the Effective Time shall be the By-laws of the Surviving
Corporation until thereafter changed or amended as provided
therein or by applicable Law.



     
SECTION 1.06. Directors. The directors of Sub immediately
prior to the Effective Time shall be the directors of the
Surviving Corporation, until the earlier of their resignation or
removal or until their respective successors are duly elected
and qualified, as the case may be.



     
SECTION 1.07. Officers. The officers of Sub immediately
prior to the Effective Time shall be the officers of the
Surviving Corporation, until the earlier of their resignation or
removal or until their respective successors are duly elected or
appointed and qualified, as the case may be.




ARTICLE II




Effect on the Capital Stock of the




Constituent Corporations; Exchange of Certificates



     
SECTION 2.01. Effect on Capital Stock. At the Effective
Time, by virtue of the Merger and without any action on the part
of the holder of any shares of Rome Common Stock or any shares
of capital stock of Sub:






		
	 	     
    (a) Capital Stock of Sub. Each issued and
    outstanding share of capital stock of Sub shall be converted
    into and become one fully paid and nonassessable share of common
    stock, par value $0.01 per share, of the Surviving Corporation.
	 
	 	     
    (b) Cancelation of Treasury Stock and Florence-Owned
    Stock. Each share of Rome Common Stock that is held by Rome
    as treasury stock or owned by FME or Sub shall no longer be
    outstanding and shall automatically be canceled and retired and
    shall cease to exist, and no Merger Consideration, cash or other
    consideration shall be delivered or deliverable in exchange
    therefor.
	 
	 	     
    (c) Conversion of Rome Common Stock.
    (i) Subject to Sections 2.01(b) and 2.01(d), each
    issued and outstanding share of Rome Common Stock shall be
    converted into the right to receive $48.00 in cash (the
    “Merger Consideration”), without interest.



     
(ii) As of the Effective Time, all such shares of Rome
Common Stock shall no longer be outstanding and shall
automatically be canceled and retired and shall cease to exist,
and each holder of a certificate representing any such shares of
Rome Common Stock shall cease to have any rights with respect
thereto, except the right to receive the Merger Consideration
upon surrender of such certificate in accordance with
Section 2.02, without interest.






		
	 	     
    (d) Appraisal Rights. Notwithstanding anything in
    this Agreement to the contrary, shares (“Appraisal
    Shares”) of Rome Common Stock that are outstanding
    immediately prior to the Effective Time and that are held by any
    person who is entitled to demand and properly demands appraisal
    of such Appraisal Shares pursuant to, and who complies in all
    respects with, Section 262 of the DGCL
    (“Section 262”) shall not be converted
    into the right to receive the Merger Consideration as provided
    in Section 2.01(c), but rather the holders of Appraisal
    Shares shall be entitled to payment of the fair value of such
    Appraisal Shares in accordance with Section 262; provided,
    however, that if any such holder shall fail to perfect or
    otherwise shall waive, withdraw or lose the right to appraisal
    under Section 262 or a court of competent jurisdiction
    shall determine that such holder is not entitled to the relief
    provided by Section 262, then the right of such holder to
    be paid the fair value of such holder’s Appraisal Shares
    shall cease, and such Appraisal Shares shall be deemed to have
    been converted as of the Effective Time into, and to have become
    exchangeable solely for the right to receive, Merger
    Consideration as provided in Section 2.01(c). Rome shall
    provide notice to FME, as promptly as reasonably practicable, of
    any demands for appraisal of any shares of Rome Common Stock,
    and FME shall have the right to participate in and direct all
    negotiations and proceedings with respect to such demands. Prior
    to the Effective Time, Rome shall not, without the prior written
    consent of FME, not to be unreasonably withheld or delayed, make
    any payment with respect to, or settle or offer to settle, any
    such demands, or agree to do any of the foregoing.



2







 



     
SECTION 2.02. Exchange of Certificates.



     
(a) Paying Agent. Prior to the Effective Time, FME
shall select a bank or trust company that is reasonably approved
by Rome to act as paying agent (the “Paying
Agent”) for the payment of the Merger Consideration
upon surrender of certificates representing Rome Common Stock.
FME shall provide to the Paying Agent immediately following the
Effective Time all the cash necessary to pay for the shares of
Rome Common Stock converted into the right to receive cash
pursuant to Section 2.01(c) (such cash being hereinafter
referred to as the “Exchange Fund”).



     
(b) As soon as reasonably practicable after the Effective
Time, the Paying Agent shall mail to each holder of record of a
certificate or certificates (the
“Certificates”) that immediately prior to the
Effective Time represented outstanding shares of Rome Common
Stock whose shares were converted into the right to receive
Merger Consideration pursuant to Section 2.01(c),
(i) a letter of transmittal (which shall specify that
delivery shall be effected, and risk of loss and title to the
Certificates shall pass, only upon delivery of the Certificates
to the Paying Agent and shall be in such form as FME may specify
and Rome may reasonably approve) and (ii) instructions for
use in effecting the surrender of the Certificates in exchange
for Merger Consideration. Upon surrender of a Certificate for
cancellation to the Paying Agent, together with such letter of
transmittal, duly executed, and such other documents as may
reasonably be required by the Paying Agent, the holder of such
Certificate shall be entitled to receive in exchange for such
Certificate the Merger Consideration into which the shares of
Rome Common Stock formerly represented by such Certificate have
been converted pursuant to the provisions of this
Article II, and the Certificate so surrendered shall be
canceled. In the event of a transfer of ownership of Rome Common
Stock that is not registered in the transfer records of Rome,
the Merger Consideration may be paid to a person other than the
person in whose name the Certificate so surrendered is
registered, if such Certificate shall be properly endorsed or
otherwise be in proper form for transfer and the person
requesting such payment shall pay any transfer or other taxes
required by reason of the payment of the Merger Consideration to
a person other than the registered holder of such Certificate or
establish to the reasonable satisfaction of FME that such tax
has been paid or is not applicable. Until surrendered as
contemplated by this Section 2.02, each Certificate shall
be deemed at any time after the Effective Time to represent only
the right to receive upon such surrender the Merger
Consideration as contemplated by this Section 2.02. No
interest shall be paid or accrue on any cash payable upon
surrender of any Certificate.



     
(c) No Further Ownership Rights in Rome Common
Stock. The Merger Consideration paid in accordance with the
terms of this Article II upon conversion of any shares of
Rome Common Stock shall be deemed to have been paid in full
satisfaction of all rights pertaining to such shares of Rome
Common Stock, and after the Effective Time there shall be no
further registration of transfers on the stock transfer books of
the Surviving Corporation of shares of Rome Common Stock that
were outstanding immediately prior to the Effective Time. If,
after the Effective Time, any Certificates formerly representing
shares of Rome Common Stock are presented to the Surviving
Corporation or the Paying Agent for any reason, they shall be
canceled and exchanged as provided in this Article II.



     
(d) Termination of Exchange Fund. Any portion of the
Exchange Fund that remains undistributed to the holders of Rome
Common Stock for one year after the Effective Time shall be
delivered, subject to applicable Law, to FME, upon demand, and
any holder of Rome Common Stock who has not complied with this
Article II before such demand shall thereafter look only to
FME for payment of its claim for the Merger Consideration.



     
(e) No Liability. None of FME, the Surviving
Corporation or the Paying Agent shall be liable to any person in
respect of any cash from the Exchange Fund delivered to a public
official pursuant to any applicable abandoned property, escheat
or similar Law. If any Certificate has not been surrendered
prior to three years after the Effective Time (or immediately
prior to such earlier date on which the Merger Consideration in
respect of such Certificate would otherwise escheat to or become
the property of any Governmental Entity (as defined in
Section 3.05(b))) any such shares, cash, dividends or
distributions in respect of such Certificate shall, to the
extent permitted by applicable Law, become the property of the
Surviving Corporation, free and clear of all claims or interest
of any person previously entitled thereto.



3







 



     
(f) Investment of Exchange Fund. The Paying Agent
shall invest any cash included in the Exchange Fund as directed
by FME, on a daily basis, in obligations of the United States of
America. Any interest and other income resulting from such
investments shall be the property of and shall be paid to FME.



     
(g) Lost Certificates. If any Certificate shall have
been lost, stolen, defaced or destroyed, upon the making of an
affidavit of that fact by the person claiming such Certificate
to be lost, stolen, defaced or destroyed and, if required by the
Surviving Corporation, the posting by such person of a bond, in
such reasonable amount as the Surviving Corporation may direct,
as indemnity against any claim that may be made against it with
respect to such Certificate, the Paying Agent will issue in
exchange for such lost, stolen or destroyed Certificate the
Merger Consideration.



     
(h) Withholding Rights. FME, the Surviving
Corporation or the Paying Agent shall be entitled to deduct and
withhold from the consideration otherwise payable pursuant to
this Agreement to any holder of shares of Rome Common Stock any
applicable taxes that FME, the Surviving Corporation or the
Paying Agent is legally required to deduct and withhold under
the Code (as defined in Section 3.10). To the extent that
amounts are so withheld and paid over to the appropriate taxing
authority by FME, the Surviving Corporation or the Paying Agent,
such withheld amounts shall be treated for all purposes of this
Agreement as having been paid to the holder of shares of Rome
Common Stock in respect of which such deduction and withholding
was made.




ARTICLE III




Representations and Warranties of Rome



     
Except as set forth in the letter, dated as of the date of this
Agreement (which letter shall be arranged in sections
corresponding to the numbered sections contained in this
Agreement), from Rome to the Florence Parties (the “Rome
Disclosure Letter”) (it being understood that any
matter disclosed in any section of the Rome Disclosure Letter
shall be deemed disclosed for all purposes and all sections of
this Agreement to which it is readily apparent from a reading of
the Rome Disclosure Letter and this Agreement that such
disclosure is applicable), Rome represents and warrants to the
Florence Parties that:



     
SECTION 3.01. Organization, Standing and Power. Each of
Rome and each subsidiary of Rome (a “Rome
Subsidiary”) is duly organized, validly existing and in
good standing under the laws of the jurisdiction in which it is
organized, except with respect to any Rome Subsidiary, where the
failure to be so organized, existing or in good standing,
individually or in the aggregate, has not had and would not
reasonably be expected to have a Rome Material Adverse Effect
(as defined below). Each of Rome and each Rome Subsidiary has
full corporate power and authority and possesses all
governmental franchises, licenses, permits, authorizations and
approvals (“Permits”) necessary to enable it to
own, lease or otherwise hold its properties and assets and to
conduct its businesses as presently conducted, other than such
franchises, licenses, permits, authorizations and approvals the
lack of which, individually or in the aggregate, has not had and
would not reasonably be expected to have a Rome Material Adverse
Effect. Each of Rome and each Rome Subsidiary is duly qualified
to do business in each jurisdiction where the nature of its
business or the ownership or leasing of its properties make such
qualification necessary, except where the failure to so qualify,
individually or in the aggregate, has not had and would not
reasonably be expected to have a Rome Material Adverse Effect.
Rome has made available to the Florence Parties true and
complete copies of the certificate of incorporation of Rome, as
amended to the date of this Agreement (as so amended, the
“Rome Charter”), and the By-laws of Rome, as
amended to the date of this Agreement (as so amended, the
“Rome By-laws”), and the comparable charter and
organizational documents of each Rome Subsidiary, in each case
as amended through the date of this Agreement. For purposes of
this Agreement: a “Rome Material Adverse
Effect” means (A) a material adverse effect on the
business, assets, liabilities, results of operations or
financial condition of Rome and the Rome Subsidiaries taken as a
whole, (B) a material adverse effect on the ability of Rome
to perform its obligations under this Agreement or (C) a
material adverse effect on the ability of Rome to consummate the
Merger and the other Transactions; provided, that none of the
following, either alone or in combination, shall be considered
in determining whether there has been a Rome Material Adverse
Effect: (1) events, circumstances, changes or effects that
generally affect providers of dialysis services in the United
States,



4







 




except to the extent that Rome and the Rome Subsidiaries, taken
as a whole, are disproportionately affected in a material and
adverse manner relative to FME and its Subsidiaries, taken as a
whole; (2) any circumstance, change or effect that results
principally from the existence of any suit, action, proceeding
or investigation undertaken by or on behalf of any Governmental
Entity (as defined in Section 3.05(b)) in connection with
any subpoenas served upon or claims made against Rome or a Rome
Subsidiary or any investigation conducted by the Office of
Inspector General of the United States Department of Health and
Human Services, the United States Department of Justice or any
State Governmental Entity that (A) has been publicly
disclosed by Rome in the Available Rome SEC Documents (as
defined in Section 3.06(d) below) or (B) relates
to any violation or alleged violation of any statute or rule or
regulation promulgated by a Governmental Entity that is
generally applicable only to participants in the health care
industry by reason of their participation in federal or state
health care programs, including Medicare and Medicaid, or their
provision of health care services to people in the United
States, including 42 U.S.C. § 1320a-7b, 42
U.S.C. § 1395nn or 31 U.S.C. § 3729-3733 or any other
federal or state statute related to false or fraudulent claims,
kickbacks to health care providers, inducements to beneficiaries
of health care programs or self-referrals; provided,
that, for the avoidance of doubt, this clause (2)(B) shall
prohibit consideration of the existence of any such suit,
action, proceeding or investigation when determining whether a
Rome Material Adverse Effect exists but shall not prohibit
consideration of actual events or circumstances constituting a
violation of any such statute or rule or regulation or other
Law; (3) general economic or political conditions, except
to the extent that Rome and the Rome Subsidiaries, taken as a
whole, are disproportionately affected in a material and adverse
manner relative to FME and its Subsidiaries, taken as a whole;
(4) changes arising from the consummation of the
transactions contemplated by, or the announcement of the
execution of, this Agreement; (5) any circumstance, change
or effect that results from any action required to be taken
pursuant to this Agreement or taken upon the written request of
FME; and (6) changes caused by acts of terrorism or war
(whether or not declared) occurring after the date hereof,
except to the extent that Rome and the Rome Subsidiaries, taken
as a whole, are disproportionately affected in a material and
adverse manner relative to FME and its subsidiaries, taken as a
whole.



     
SECTION 3.02. Rome Subsidiaries; Equity Interests.
(a) The Rome Disclosure Letter lists each Rome Subsidiary,
its jurisdiction of organization and Rome’s interest
therein. All the outstanding shares of capital stock or other
equity interests, as applicable, of each Rome Subsidiary have
been validly issued and are fully paid and nonassessable and
except as set forth in the Rome Disclosure Letter, are as of the
date of this Agreement owned by Rome, by another Rome Subsidiary
or by Rome and another Rome Subsidiary, free and clear of all
pledges, liens, charges, mortgages, encumbrances and security
interests of any kind or nature whatsoever (collectively,
“Liens”). There are no bonds, debentures, notes
or other indebtedness of any Rome Subsidiary having the right to
vote (or convertible into, or exchangeable for, securities
having the right to vote) on matters on which the equity holders
of any Rome Subsidiary may vote.



     
(b) Except for its interests in Rome Subsidiaries and
except for the ownership interests set forth in the Rome
Disclosure Letter, as of the date of this Agreement, Rome does
not own, directly or indirectly, any capital stock, membership
interest, partnership interest, joint venture interest or other
equity interest in any person.



     
SECTION 3.03. Capital Structure. The authorized capital
stock of Rome consists of (i) 150,000,000 shares of
Rome Common Stock and (ii) 10,000,000 shares of preferred
stock, par value $0.01 per share (the “Rome
Preferred Stock” and, together with the Rome Common
Stock, the “Rome Capital Stock”), of which
400,000 shares have been designated as Series A Junior
Participating Preferred Stock. At the close of business on
April 29, 2005, (i) 67,997,913 shares of Rome
Common Stock (excluding shares of Rome Common Stock held by Rome
in its treasury) and no shares of Rome Preferred Stock were
issued and outstanding, (ii) 14,766,300 shares of Rome
Common Stock were held by Rome in its treasury,
(iii) 8,731,694 shares of Rome Common Stock were
subject to outstanding Rome Stock Options (as defined in
Section 6.04(e)) and 6,912,909 additional shares of Rome
Common Stock were reserved for issuance pursuant to Rome Stock
Plans (as defined in Section 6.04(e)) and (iv) 400,000
shares of Rome Preferred Stock were reserved for issuance in
connection with the rights (the “Rome Rights”)
issued pursuant to the Shareholder Protection Rights Agreement
dated as of May 2, 1997 (as amended from time to time, the



5







 




“Rome Rights Agreement”), between Rome and
First Union National Bank of North Carolina, as Rights Agent. As
of April 29, 2005, no shares of Rome Common Stock are owned
by any Rome Subsidiary. As of the close of business on
April 29, 2005, (i) there were outstanding Rome Plan
Stock Options (as defined in Section 6.04) to purchase
8,544,842 shares of Rome Common Stock with exercise prices on a
per share basis lower than the Merger Consideration,
(ii) there were outstanding Rome Non-Plan Stock Options (as
defined in Section 6.04(e)) to purchase 186,852 shares of Rome
Common Stock with exercise prices on a per share basis lower
than the Merger Consideration, and (iii) and the weighted
average exercise price of the Rome Stock Options referred to in
the preceding clauses (i) and (ii) was equal to
$21.034. Except as set forth above, at the close of business on
April 29, 2005, no shares of capital stock or other voting
securities of Rome were issued, reserved for issuance or
outstanding. During the period from April 29, 2005, to the
date of this Agreement, (x) there have been no issuances by
Rome of shares of capital stock of, or other equity or voting
interests in, Rome other than issuances of shares of Rome Common
Stock pursuant to the exercise of Rome Stock Options outstanding
on such date in accordance with their terms as in effect on the
date of this Agreement and (y) there have been no issuances
by Rome of options, warrants or other rights to acquire shares
of capital stock or other equity or voting interests from Rome.
All outstanding shares of Rome Capital Stock are, and all such
shares that may be issued pursuant to the Rome Stock Plans will
be when issued in accordance with the terms thereof, duly
authorized, validly issued, fully paid and nonassessable and not
subject to or issued in violation of any purchase option, call
option, right of first refusal, preemptive right, subscription
right or any similar right under any provision of the DGCL, Rome
Charter, Rome By-laws or any Contract (as defined in
Section 3.05) to which Rome is a party or otherwise bound.
There are no bonds, debentures, notes or other indebtedness of
Rome having the right to vote (or convertible into, or
exchangeable for, securities having the right to vote) on any
matters on which holders of Rome Capital Stock may vote
(“Rome Voting Debt”). As of the date of this
Agreement, there are no options, warrants, rights, convertible
or exchangeable securities, “phantom” stock rights,
stock appreciation rights, stock-based performance units,
commitments, Contracts, arrangements or undertakings of any kind
to which Rome or any Rome Subsidiary is a party or by which Rome
or any Rome Subsidiary is bound (i) obligating Rome or any
Rome Subsidiary to issue, deliver or sell, or cause to be
issued, delivered or sold, additional shares of capital stock of
or other equity or voting interests in, or any security
convertible or exercisable for or exchangeable into any capital
stock of or other equity or voting interest in, Rome or any Rome
Subsidiary or any Rome Voting Debt, (ii) obligating Rome or
any Rome Subsidiary to issue, grant, extend or enter into any
such option, warrant, call, right, security, commitment,
Contract, arrangement or undertaking, or (iii) that give
any person the right to receive any economic benefit or right
similar to or derived from the economic benefits and rights
accruing to holders of Rome Capital Stock. As of the date of
this Agreement, there are no outstanding contractual obligations
of Rome or any Rome Subsidiary to (i) repurchase, redeem or
otherwise acquire any shares of capital stock of or other equity
or voting interest in Rome or any Rome Subsidiary or
(ii) vote or dispose of any shares of the capital stock of,
or other equity or voting interests in, any of the Rome
Subsidiaries. Rome has made available to the Florence Parties a
complete and correct copy of the Rome Rights Agreement, as
amended to the date of this Agreement.



     
SECTION 3.04. Authority; Execution and Delivery;
Enforceability. (a) Rome has all requisite corporate
power and authority to execute and deliver this Agreement and to
consummate the Transactions. The execution and delivery by Rome
of this Agreement and the consummation by Rome of the
Transactions have been duly authorized by all necessary
corporate action on the part of Rome, subject, in the case of
the Merger, to receipt of the Rome Stockholder Approval (as
defined in Section 3.04(c)). Rome has duly executed and
delivered this Agreement, and this Agreement constitutes its
legal, valid and binding obligation, enforceable against it in
accordance with its terms.



     
(b) The Board of Directors of Rome (the “Rome
Board”), at a meeting duly called and held, duly
adopted resolutions (i) approving this Agreement, the
Merger and the other Transactions, (ii) determining and
declaring that the terms of the Merger and the other
Transactions are advisable and fair to and in the best interests
of Rome and its stockholders, (iii) recommending that
Rome’s stockholders adopt this Agreement, and
(iv) declaring that this Agreement is advisable. The Rome
Board has taken all action necessary in order that the limits on
business combinations provided for in Section 203 of the
DGCL will not apply to this Agreement, the Merger or any other
Transaction. To the knowledge of Rome, no other state takeover
statute



6







 




or similar statute or regulation applies or purports to apply to
Rome with respect to this Agreement, the Merger or any other
Transaction.



     
(c) The only vote of holders of any class or series of Rome
Capital Stock necessary to approve and adopt this Agreement and
the Merger is the adoption of this Agreement by the holders of a
majority of the outstanding Rome Common Stock (the “Rome
Stockholder Approval”). The affirmative vote of the
holders of Rome Capital Stock, or any of them, is not necessary
to consummate any Transaction other than the Merger.



     
SECTION 3.05. No Conflicts; Consents. (a) Except as
set forth in the Available Rome SEC Documents, the execution and
delivery by Rome of this Agreement do not, and the consummation
of the Merger and the other Transactions and compliance with the
terms hereof will not, conflict with, or result in any violation
of or default (with or without notice or lapse of time, or both)
under, or give rise to a right of termination, cancelation or
acceleration of any obligation or to loss of a material benefit
under, or result in the creation of any Lien upon any of the
properties or assets of Rome or any Rome Subsidiary under, any
provision of (i) the Rome Charter or the Rome By-laws;
(ii) the comparable charter or organizational documents of
any Rome Subsidiary, (iii) any material contract, lease,
license, indenture, note, bond, agreement, permit, concession,
franchise or other instrument (a “Contract”) to
which Rome or any Rome Subsidiary is a party or by which any of
their respective properties or assets is bound or
(iv) subject to the filings and other matters referred to
in Section 3.05(b), any judgment, order or decree
(“Judgment”) applicable to Rome or any Rome
Subsidiary or their respective properties or assets, any Permit
held by Rome or any Rome Subsidiary, or Federal, state, local,
regional or foreign statute, law, ordinance, rule, reporting or
licensing requirement or regulation (“Law”)
applicable to Rome or any Rome Subsidiary or their respective
properties or assets, other than, in the case of clauses
(ii) through (iv) above, any such items that,
individually or in the aggregate, have not had and would not
reasonably be expected to have a Rome Material Adverse Effect.



     
(b) No consent, approval, license, permit, order or
authorization (“Consent”) of, or registration,
declaration or filing with, or permit from, any national,
federal, state, provincial, local or foreign government or any
court of competent jurisdiction, administrative agency or
commission or other governmental or regulatory authority or
instrumentality, domestic or foreign (a “Governmental
Entity”) is required to be obtained or made by or with
respect to Rome or any Rome Subsidiary in connection with the
execution, delivery and performance of this Agreement or the
consummation of the Transactions, other than (i) compliance
with and filings under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the “HSR
Act”), (ii) the filing with the Securities and
Exchange Commission (the “SEC”) of (A) a
proxy statement relating to the adoption of this Agreement by
Rome’s stockholders (including any amendment or supplement
thereto, the “Proxy Statement”) and
(B) such reports under Section 13 of the Securities
Exchange Act of 1934, as amended (the “Exchange
Act”), as may be required in connection with this
Agreement, the Merger and the other Transactions, (iii) the
filing of the Certificate of Merger with the Secretary of State
of the State of Delaware and appropriate documents with the
relevant authorities of the other jurisdictions in which Rome or
any Rome Subsidiary is qualified to do business, (iv) such
filings as may be required under applicable Environmental Laws
(as defined in Section 3.14(b)), (v) such filings as may be
required in connection with the taxes described in
Section 6.09, and (vi) such other items
(A) required solely by reason of the participation of any
Florence Parties (as opposed to any third party) in the
Transactions or (B) that the failure of which to be
obtained or made, individually or in the aggregate, have not had
and would not reasonably be expected to have a Rome Material
Adverse Effect.



     
(c) Rome and the Rome Board have taken all action necessary to
(i) render the Rome Rights inapplicable to this Agreement,
the Merger and the other Transactions and (ii) ensure that
(A) neither any Florence Party nor any of their affiliates
or associates is or will become an “Acquiring Person”
(as defined in the Rome Rights Agreement) by reason of this
Agreement, the Merger or any other Transaction, (B) the
“Separation Time” (as defined in the Rome Rights
Agreement) shall not occur by reason of this Agreement, the
Merger or any other Transaction, and (C) the Rome Rights
shall expire immediately prior to the Effective Time.



7







 



     
SECTION 3.06. SEC Documents; Undisclosed Liabilities.
(a) Rome has filed with the SEC (or, in the case of
information provided under Item 7.01 of a report on
Form 8-K, furnished to the SEC) all reports, schedules,
forms, statements and other documents required to be filed (or,
in the case of information provided under Item 7.01 of a
report on Form 8-K, furnished) by Rome since
January 1, 2002, pursuant to Sections 13(a) and 15(d)
of the Exchange Act (the “Rome SEC Documents”).
Each Rome Subsidiary has filed with the SEC all reports,
schedules, forms, statements and other documents required to be
filed by such Rome Subsidiary since January 1, 2002,
pursuant to Sections 13(a) and 15(d) of the Exchange Act.



     
(b) Except to the extent set forth in a later filed or furnished
Rome SEC Document, as of its date, each Rome SEC Document
complied in all material respects with the requirements of the
Exchange Act or the Securities Act of 1933, as amended (the
“Securities Act”), as the case may be, and the
rules and regulations of the SEC promulgated thereunder
applicable to such Rome SEC Document, and did not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under
which they were made, not misleading. Except to the extent that
information contained in any Rome SEC Document has been revised
or superseded by a later filed or furnished Rome SEC Document,
none of the Rome SEC Documents contains any untrue statement of
a material fact or omits to state any material fact required to
be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading; provided, however, that no
representation is made as to any information furnished by Rome
to the SEC solely for purposes of complying with
Regulation FD promulgated by the SEC under the Exchange
Act. The consolidated financial statements of Rome and the Rome
Subsidiaries included in the Rome SEC Documents comply as to
form in all material respects with applicable accounting
requirements and the published rules and regulations of the SEC
with respect thereto, have been prepared in accordance with
generally accepted accounting principles in the United States
(“GAAP”) (except, in the case of unaudited
statements, as permitted by Form 10-Q of the SEC) applied
on a consistent basis during the periods involved (except as may
be indicated in the notes thereto) and fairly present the
consolidated financial position of Rome and the consolidated
Rome Subsidiaries as of the dates thereof and the consolidated
results of their operations and cash flows for the periods shown
(subject, in the case of unaudited statements, to normal
year-end audit adjustments).



     
(c) Since the enactment of the Sarbanes-Oxley Act of 2002 (the
“Sarbanes-Oxley Act”), Rome has been in
compliance, in all material respects, with all provisions of the
Sarbanes-Oxley Act, including the rules and regulations of the
SEC promulgated thereunder, applicable to Rome and the Rome
Subsidiaries.



     
(d) Except as set forth in the reports, schedules, forms,
statements and other documents filed by Rome with the SEC or
furnished by Rome to the SEC, and in either case, publicly
available prior to the date of this Agreement (but excluding the
portions of Rome’s Annual Report on Form 10-K for the
fiscal year ended December 31, 2004 identified in
Section 3.06(d) of the Rome Disclosure Letter, and the
substantially identical portions of any other such reports,
schedules, forms, statements or other documents, the
“Available Rome SEC Documents”), as of the date
of this Agreement, neither Rome nor any Rome Subsidiary has any
liabilities or obligations of any nature (whether accrued,
absolute, contingent or otherwise) required by GAAP to be set
forth on a consolidated balance sheet of Rome and its
consolidated subsidiaries or in the notes thereto, other than
any liabilities or obligations (A) reserved against,
reflected or disclosed on the most recent consolidated balance
sheet of Rome and the Rome Subsidiaries (including the notes
thereto) contained in the Available Rome SEC Documents,
(B) incurred in the ordinary course of business since the
date of the most recent financial statements included in the
Available Rome SEC Documents, or (C) that, individually or
in the aggregate, have not had and would not reasonably be
expected to have a Rome Material Adverse Effect.



     
SECTION 3.07. Information Supplied. None of the
information supplied or to be supplied by Rome for inclusion or
incorporation by reference in the Proxy Statement will, at the
date it is first mailed to Rome’s stockholders or at the
time of the Rome Stockholders Meeting (as defined in
Section 6.01(a)), contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they are
made, not misleading; provided, that no representation is
made by Rome with respect to statements made or incorporated by
reference in the Proxy Statement based on information supplied
in writing by any Florence



8







 




Party for inclusion or incorporation by reference therein. The
Proxy Statement will comply as to form in all material respects
with the requirements of the Exchange Act and the rules and
regulations thereunder, except that no representation is made by
Rome with respect to statements made or incorporated by
reference therein based on information supplied by any Florence
Party for inclusion or incorporation by reference therein.



     
SECTION 3.08. Absence of Certain Changes or Events.
Except as set forth in the Available Rome SEC Documents,
(a) from the date of the most recent financial statements
included in the Available Rome SEC Documents to the date of this
Agreement, Rome and the Rome Subsidiaries (on a consolidated
basis, taken as a whole) have conducted their business only in
the ordinary course consistent with past practice, and
(b) during such period there has not been:






		
	 	     
    (i) any event, change, effect or development that,
    individually or in the aggregate, has had or would reasonably be
    expected to have a Rome Material Adverse Effect;
	 
	 	     
    (ii) (A) any declaration, setting aside or payment of
    any dividend or other distribution (whether in cash, stock or
    property) with respect to any Rome Capital Stock or any other
    capital stock or other equity or voting interests of Rome or any
    Rome Subsidiary (other than pro rata dividends and distributions
    by a direct or indirect Rome Subsidiary to the holders of its
    capital stock or other equity interests) or (B) any
    repurchase, redemption or other acquisition by Rome of any Rome
    Capital Stock or any other capital stock or other equity or
    voting interests of Rome or any Rome Subsidiary;
	 
	 	     
    (iii) any split, combination or reclassification of any
    Rome Capital Stock or other equity or voting interests in Rome
    or any issuance or the authorization of any issuance of any
    other securities in respect of, in lieu of or in substitution
    for shares of Rome Capital Stock or other equity or voting
    interests in Rome;
	 
	 	     
    (iv) (A) any granting by Rome or any Rome Subsidiary
    to any director or executive officer of Rome or any Rome
    Subsidiary of any increase in compensation, except in the
    ordinary course of business consistent with prior practice or as
    was required under employment agreements in effect as of the
    date of the most recent financial statements included in the
    Available Rome SEC Documents, (B) any granting by Rome or
    any Rome Subsidiary to any such director or executive officer of
    any increase in severance or termination pay, except as was
    required under any employment, severance or termination
    agreements in effect as of the date of the most recent financial
    statements included in the Available Rome SEC Documents, or
    (C) any entry by Rome or any Rome Subsidiary into any
    employment, severance or termination agreement with any such
    director or executive officer;
	 
	 	     
    (v) any change in accounting methods, principles or
    practices by Rome or any Rome Subsidiary materially affecting
    the consolidated assets, liabilities or results of operations of
    Rome, except insofar as may have been required by a change in
    GAAP;
	 
	 	     
    (vi) any material elections with respect to Taxes (as
    defined in Section 3.09(g)) by Rome or any Rome Subsidiary
    or settlement or compromise by Rome or any Rome Subsidiary of
    any material Tax liability or refund; or
	 
	 	     
    (vii) any material “impairment” (within the
    meaning of Statement of Financial Accounting Standards
    Number 142 entitled “Goodwill and other Intangible
    Assets” or Statement of Financial Accounting Standards
    Number 144 entitled “Accounting for Impairment or
    Disposal of Long-Lived Assets”) with respect to any of the
    assets of Rome or any Rome Subsidiary.



     
SECTION 3.09. Taxes. (a) Each of Rome and each Rome
Subsidiary has timely filed, or has caused to be timely filed on
its behalf, all Tax Returns (as defined in Section 3.09(g))
required to be filed by it, and all such Tax Returns are true,
complete and accurate, except to the extent any failure to file
or any inaccuracies in any filed Tax Returns, individually or in
the aggregate, have not had and would not reasonably be expected
to have a Rome Material Adverse Effect. All Taxes shown to be
due on such Tax Returns, or otherwise owed by Rome and each Rome
Subsidiary, have been timely paid, except to the extent that any
failure to pay, individually or in the aggregate, has not had
and would not reasonably be expected to have a Rome Material
Adverse Effect.



9







 



     
(b) The most recent financial statements contained in the
Available Rome SEC Documents reflect an adequate reserve for all
Taxes payable by Rome and the Rome Subsidiaries (in addition to
any reserve for deferred Taxes to reflect timing differences
between book and tax items) for all Taxable periods and portions
thereof accrued through the date of such financial statements.



     
(c) No deficiency, refund litigation, adjustment, audit
examination or matter in controversy with respect to any Taxes
has been proposed, asserted or assessed against Rome or any Rome
Subsidiary, and no requests for waivers of the applicable
statute of limitations to assess any such Taxes are pending,
except to the extent any such deficiency or request for waiver,
individually or in the aggregate, has not had and would not
reasonably be expected to have a Rome Material Adverse Effect.
The Federal income Tax Returns of Rome and each Rome Subsidiary
consolidated in such Tax Returns have been examined by and
settled with the United States Internal Revenue Service, or have
closed by virtue of the expiration of the relevant statute of
limitations, for all years through 2003. All assessments for
Taxes due and owing by Rome or any Rome Subsidiary with respect
to completed and settled examinations or any concluded
litigation have been fully paid, except for any assessments that
have not had and would not reasonably be expected to have a Rome
Material Adverse Effect.



     
(d) There are no Liens for Taxes (other than for current
Taxes not yet due and payable) on the assets of Rome or any Rome
Subsidiary, except for any Liens that have not had and would not
reasonably be expected to have a Rome Material Adverse Effect.
Neither Rome nor any Rome Subsidiary is bound by any agreement
with respect to Taxes (including with respect to a tax
allocation agreement, a tax indemnification agreement, or a tax
sharing agreement or any advance pricing agreement, closing
agreement or other agreement relating to Taxes with any taxing
authority). Neither Rome nor any Rome Subsidiary has any
liability for the Taxes of any person (other than Rome or any
Rome Subsidiary) under Treasury
Regulation Section 1.1502-6 (or any similar provision
of state, local, or foreign law) as a transferee or successor,
by contract, or otherwise, as a result of any consolidated,
combined, unitary or aggregate group for Tax purposes of which
such person was a member, except for any liability that has not
had and would not reasonably be expected to have a Rome Material
Adverse Effect.



     
(e) Neither Rome nor any Rome Subsidiary has constituted
either a “distributing corporation” or a
“controlled corporation” or a successor thereto in a
distribution of stock qualifying for Tax-free treatment under
Section 355 of the Code.



     
(f) Neither Rome nor any Rome Subsidiary has entered into
any “listed transaction” as defined in Treasury
Regulation Section 1.6011-4(b)(1).



     
(g) For purposes of this Agreement:



     
“Taxes” includes (i) all forms of
taxation, whenever created or imposed, and whether of the United
States or elsewhere, and whether imposed by a local, provincial,
municipal, governmental, state, foreign, federal, national or
other Governmental Entity, or in connection with any agreement
with respect to Taxes, including but not limited to, any net
income, alternative or add-on minimum tax, gross income, gross
receipts, sales, use, value added, ad valorem, transfer,
franchise, profits, license, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property,
environmental or windfall profit tax, custom duty or other tax,
governmental fee or other like assessment or charge of any kind
whatsoever, together with all interest, penalties and additions
imposed with respect to such amounts (ii) liability for the
payment of any amount of the type described in clause
(i) as a result of being a member of an affiliated,
consolidated, combined or unitary group and (iii) liability
for the payment of any amounts as a result of being a transferee
of or a successor to any person or a party to any tax sharing
agreement or as a result of an express or implied obligation to
indemnify any other person with respect to the payment of any
amounts of the type described in
clause (i) or (ii).



     
“Tax Return” means all national, federal,
state, local, provincial and foreign Tax returns, declarations,
statements, reports, schedules, forms and information returns
and any amended Tax return relating to Taxes.



     
SECTION 3.10. Absence of Changes in Benefit Plans. Except
as set forth in the Available Rome SEC Documents, from the date
of the most recent audited financial statements included in the
Available Rome



10







 




SEC Documents to the date of this Agreement, (i) there has
not been any adoption or amendment in any material respect by
Rome or any Rome Subsidiary of any collective bargaining
agreement or any bonus, pension, profit sharing, deferred
compensation, incentive compensation, stock ownership, stock
purchase, stock option, phantom stock, retirement, vacation,
severance, disability, death benefit, hospitalization, medical
or other material compensation or benefit plan, program, policy,
agreement, or arrangement established, maintained, or
contributed to, by Rome, any Rome Subsidiary, or any other Rome
affiliate (which together with Rome would be treated as a single
employer under Section 414(b), (c), (m), or (o) of the
Internal Revenue Code of 1986, as amended (the
“Code”)) (such Rome Subsidiaries and other Rome
affiliates shall hereinafter collectively be referred to as
“ERISA Affiliates” and individually as an
“ERISA Affiliate”) providing benefits to any
current or former employee, officer or director of Rome or any
ERISA Affiliate, or with respect to which Rome or any ERISA
Affiliate has or would reasonably be expected to have any
liability (collectively, “Rome Benefit Plans”)
and (ii) none of Rome or the Rome Subsidiaries have
incurred any material unfunded liability as a result of any
adoption by Rome or any ERISA Affiliate of any Rome Benefit Plan
or any amendment to any Rome Benefit Plan. Except as set forth
in the Available Rome SEC Documents, as of the date of this
Agreement there are no employment, consulting, indemnification,
severance or termination agreements or arrangements between Rome
or any Rome Subsidiary and any current or former executive
officer or director of Rome or any Rome Subsidiary.



     
SECTION 3.11. ERISA Compliance; Excess Parachute
Payments. (a) The Rome Disclosure Letter contains a
list of all Rome Benefit Plans that are “employee pension
benefit plans” (as defined in Section 3(2) of the
Employee Retirement Income Security Act of 1974, as amended
(“ERISA”)) (“Rome Pension
Plans”) or “employee welfare benefit plans”
(as defined in Section 3(1) of ERISA) (“Rome
Welfare Plans”) and all other material Rome Benefit
Plans. Each Rome Benefit Plan has been administered in
compliance with its terms, other than instances of noncompliance
that, individually and in the aggregate, have not had and would
not reasonably be expected to have a Rome Material Adverse
Effect. Rome has made available to the Florence Parties true,
complete and correct copies of (i) each Rome Benefit Plan
(or, in the case of any unwritten Rome Benefit Plan, a
description thereof), (ii) the most recent annual report on
Form 5500 filed with the Internal Revenue Service with
respect to each Rome Benefit Plan (if any such report was
required), (iii) the most recent summary plan description
for each Rome Benefit Plan for which such summary plan
description is required or was otherwise prepared and
(iv) each trust agreement, funding arrangement, and group
annuity contract, third party administration agreement and
investment management agreement relating to any Rome Benefit
Plan.



     
(b) All Rome Pension Plans that are intended to be tax qualified
have been the subject of determination letters from the Internal
Revenue Service to the effect that such Rome Pension Plans are
qualified and exempt from Federal income taxes under
Sections 401(a) and 501(a), respectively, of the Code, and
no such determination letters have been revoked, and, to the
knowledge of Rome, no such revocation has been threatened. Each
such determination letter is current in that it covers all of
the provisions of each Rome Pension Plan to which it relates
(including changes required by applicable law) with respect to
which the Code Section 401(b) remedial amendment period has
expired as of the date of this Agreement, and with respect to
any such provisions with respect to which the Code Section
401(b) remedial amendment period has not expired as of the date
of this Agreement, a timely application for a determination has
been filed for such Rome Pension Plan, and is pending before the
Internal Revenue Service. To the knowledge of Rome, nothing has
occurred since the date of the determination letters that would
reasonably be expected to materially adversely affect the
qualification of the Rome Pension Plans. Each trust intended to
qualify under Section 501(c)(9) of the Code so qualifies in
form and in operation in all material respects, meets the
requirements of Section 505(c) of the Code and the
regulations thereunder in all material respects, and has
received an opinion letter from the Internal Revenue Service
that such trust so qualifies, and no fact or event has occurred
since the date of any opinion letter which could affect
adversely the exempt status of any such trust, except as has not
had and would not reasonably be expected to have a Rome Material
Adverse Effect.



     
(c) Rome and its ERISA Affiliates and all the Rome Benefit Plans
are in compliance with all applicable provisions of ERISA, the
Code, and other applicable laws, except for instances of
noncompliance that, individually or in the aggregate, have not
had and would not reasonably be expected to have a Rome Material



11







 




Adverse Effect. All required reports and descriptions of the
Rome Benefit Plans have been timely filed with applicable
government agencies and/or distributed to participants, except
where the failure to be so filed or distributed, individually or
in the aggregate, has not had and would not reasonably be
expected to have a Rome Material Adverse Effect. There is not
pending or, to the knowledge of Rome, threatened any litigation,
investigation or audit relating to the Rome Benefit Plans that,
individually or in the aggregate, has had or would reasonably be
expected to have a Rome Material Adverse Effect.



     
(d) Except as individually and in the aggregate, has not had and
would not reasonably be expected to have a Rome Material Adverse
Effect, none of Rome, any ERISA Affiliate, any officer of Rome
or any ERISA Affiliate or any of the Rome Benefit Plans which
are subject to ERISA, including the Rome Pension Plans, or, to
the knowledge of Rome, any trusts created thereunder or any
trustee or administrator thereof, has engaged in a
“prohibited transaction” (as such term is defined in
Section 406 of ERISA or Section 4975 of the Code) or
any other breach of fiduciary responsibility that would
reasonably be expected to subject Rome, any ERISA Affiliate or
any officer of Rome or any ERISA Affiliate to the tax or penalty
on prohibited transactions imposed by such Section 4975 or
to any liability under Section 502(i) or 502(1) of ERISA.



     
(e) Each Rome Benefit Plan that is a “group health
plan” (as such term is defined in Section 5000(b)(1)
of the Code), complies with the applicable requirements of
Section 4980B(f) of the Code, other than instances of
noncompliance that, individually and in the aggregate, have not
had and would not reasonably be expected to have a Rome Material
Adverse Effect.



     
(f) Except as has not had and would not reasonably be expected
to have a Rome Material Adverse Effect, (A) neither Rome
nor any of its ERISA Affiliates has within the six year period
ending on the date hereof, established, maintained, contributed
to or has any liability with respect to, any material employee
benefit plan (i) subject to Title IV of ERISA,
(ii) that has ever been a multiemployer plan within the
meaning of ERISA Section 3(37), ERISA Section 4001(a)(3) or
Code Section 414(f), (iii) that has ever been subject
to Code Section 412 or ERISA Section 302, or
(iv) that has ever been a “multiple employer welfare
plan” or a “multiple employer welfare
arrangement” within the meaning of ERISA
Section 514(b)(6) or a welfare benefit fund within the
meaning of Code Section 419(e), and (B) none of Rome,
any ERISA Affiliate nor any Rome Welfare Plan has ever provided
or has any obligation to provide in the future to current or
former employees any material medical, life insurance or other
welfare benefits after retirement or other termination of
service, other than coverage mandated by applicable Law.



     
(g) Except as would not reasonably be expected to have a Rome
Material Adverse Effect, neither the execution and delivery of
this Agreement nor the consummation of the transactions
contemplated herein will (a) result in any payment
(including severance, unemployment compensation, golden
parachute, or otherwise) becoming due to any director, employee
or independent contractor of Rome or any ERISA Affiliate,
(b) increase any benefits otherwise payable under any Rome
Benefit Plan, or (c) result in any acceleration of the time
of payment or vesting of any benefit under any Rome Benefit
Plan. Neither Rome nor any ERISA Affiliate, nor any of their
officers or directors, has taken any direct or indirect action
which obligates Rome or any ERISA Affiliate to institute, modify
or change, any Rome Benefit Plan, or the manner in which
contributions to any Rome Benefit Plan are made or the basis on
which such contributions are determined, except for such
institutions, modifications or changes that, individually or in
the aggregate, have not had and would not reasonably be expected
to have a Rome Material Adverse Effect. The deduction of any
amount payable pursuant to the terms of the Rome Benefit Plans
would not be subject to disallowance under Code
Section 162(m) (before giving effect to Code Section
162(m)(4)(F)) for any taxable years of Rome ending prior to the
date hereof.



     
(h) Other than payments that may be made to the persons listed
in the Rome Disclosure Letter (the “Primary Rome
Executives”), any amount that could be received
(whether in cash or property or the vesting of property) as a
result of the Merger or any other Transaction by any employee,
officer or director of Rome or any of its affiliates who is a
“disqualified individual” (as such term is defined in
Treasury Regulation Section 1.280G-1) under any
employment, severance or termination agreement, other
compensation arrangement or Rome Benefit Plan currently in
effect would not be characterized as an “excess parachute
payment” (as defined in Section 280G(b)(1) of the
Code) and except as set forth in the Available Rome SEC Documents



12







 




and except for obligations with respect to Primary Rome
Executives, neither Rome nor any of its ERISA Affiliates will be
required to “gross up” or otherwise compensate any
such Primary Rome Executive in respect thereof.



     
SECTION 3.12. Litigation. Except as set forth in the
Available Rome SEC Documents, as of the date of this Agreement,
(i) there is no suit, claim, demand, action or proceeding
pending or, to the knowledge of Rome, threatened against Rome or
any Rome Subsidiary or any of their respective assets that,
individually or in the aggregate, has had or would reasonably be
expected to have a Rome Material Adverse Effect, and
(ii) there is no Judgment outstanding against, or consent
decree binding upon, Rome or any Rome Subsidiary that
individually or in the aggregate, has had or would reasonably be
expected to have a Rome Material Adverse Effect. Except as set
forth in the Available Rome SEC Documents, to the knowledge of
Rome, there is not any active or impending investigation,
compliance review, inspection, hearing, administrative or other
proceeding, notice of violation, order of forfeiture or
complaint by any Governmental Entity against Rome or any Rome
Subsidiary that individually or in the aggregate, has had or
would reasonably be expected to have a Rome Material Adverse
Effect.



     
SECTION 3.13. Compliance with Applicable Laws. Except as
set forth in the Available Rome SEC Documents, to the knowledge
of Rome, Rome and the Rome Subsidiaries are in compliance with
all applicable Laws and Judgments of any Governmental Entity
applicable to their businesses and operations, except for
instances of noncompliance that, individually and in the
aggregate, have not had and would not reasonably be expected to
have a Rome Material Adverse Effect. Except as set forth in the
Available Rome SEC Documents, neither Rome nor any Rome
Subsidiary has received any written communication or, to the
knowledge of Rome, any other communication since January 1,
2002, from a Governmental Entity that alleges that Rome or a
Rome Subsidiary is not in compliance in any material respect
with any applicable Law or Judgment of any Governmental Entity
applicable to its businesses and operations. Except as set forth
in the Available Rome SEC Documents, neither Rome nor any Rome
Subsidiary is in violation of, default under, nor has any event
occurred giving to any other person any right of termination,
amendment or cancellation of, with or without notice or lapse of
time or both, any Permit of Rome or any Rome Subsidiary, except
for any such violations, defaults, events, terminations,
amendments or cancellations that, individually or in the
aggregate, have not had and would not reasonably be expected to
have a Rome Material Adverse Effect. This Section 3.13 does
not relate to matters with respect to Taxes, which are the
subject of Section 3.09, to matters with respect to
Environmental Law, which are the subject of Section 3.14 or
to matters with respect to HIPAA (as defined in
Section 3.20), or federal or state statutes related to
health care matters, including false or fraudulent claims and
healthcare fraud and abuse matters, which are the subject to
Section 3.20.



     
SECTION 3.14. Environmental Matters. (a) Except as
disclosed in the Available Rome SEC Documents and except for
such matters that individually or in the aggregate would not
reasonably be expected to have a Rome Material Adverse Effect:
(i) Rome and each Rome Subsidiary possesses all
Environmental Permits (as defined below) necessary to conduct
its businesses and operations in compliance with all
Environmental Laws (as defined below); (ii) to the
knowledge of Rome, Rome and each Rome Subsidiary has been and is
in compliance with all applicable Environmental Laws and all
applicable Environmental Permits, and none of Rome or the Rome
Subsidiaries has received any written communication from any
Governmental Entity that alleges that Rome or any Rome
Subsidiary has violated or is liable under any Environmental Law
or Environmental Permit; (iii) there are no Environmental
Claims (as defined below) pending or, to the knowledge of Rome,
threatened (A) against Rome or any Rome Subsidiary or
(B) against any person whose liability for any such
Environmental Claim has been retained or assumed by Rome or any
Rome Subsidiary, either contractually or by operation of law;
and (iv) to the knowledge of Rome, there have been no
Releases (as defined below) of any Hazardous Materials (as
defined below) at or from any property or facility owned or
operated by Rome or any Rome Subsidiary that would reasonably be
expected to form the basis of any Environmental Claim against
Rome or any Rome Subsidiary or any liability on the part of Rome
or any Rome Subsidiary under any Environmental Law or
Environmental Permit.



     
(b) For the purposes of this Agreement: (A)
“Environmental Claims” means any and all
administrative, regulatory or judicial actions, orders, decrees,
suits, demands, demand letters, directives, claims, liens,
investigations, proceedings or notices of noncompliance or
violation by any Governmental Entity or other



13







 




person alleging liability arising out of, based on or related to
(x) the presence, Release or threatened Release of, or exposure
to, any Hazardous Materials at any location, whether or not
owned, operated, leased or managed by Rome or any Rome
Subsidiary, or (y) any other circumstances forming the
basis of any violation or alleged violation of any Environmental
Law or Environmental Permit; (B) “Environmental
Laws” means all applicable laws, rules, regulations,
orders, decrees, common law, judgments or any binding agreements
issued, promulgated or entered into by Rome or any Rome
Subsidiary with any Governmental Entity relating to pollution or
protection of the environment (including ambient air, surface
water, groundwater, soils, subsurface strata and natural
resources) or to human health and safety, including laws and
regulations relating to the presence of, exposure to, Release of
or threatened Release of Hazardous Materials or otherwise
relating to the generation, manufacture, processing,
distribution, use, treatment, storage, recycling, transport,
handling of, or the arrangement for such activities with respect
to, Hazardous Materials; (C) “Environmental
Permits” means all permits, licenses, certificates,
registrations, waivers, exemptions and other authorizations
required under applicable Environmental Laws;
(D) “Hazardous Materials” means any
substance which is regulated by (or is present at levels or in
concentrations that require remediation under) environmental
laws, and includes, without limitation, (x) any and all
materials or substances which are defined as hazardous waste,
extremely hazardous waste or a hazardous substance pursuant to
state, federal or local governmental law; (y) asbestos and
asbestos containing materials; (z) polychlorinated
biphenyls; (aa) petroleum products, including without
limitation, crude oil, constituents of petroleum products, and
substances derived from petroleum; (bb) urea formaldehyde
and related substances; (cc) radon and other radioactive
substances; (dd) substances which are toxic, ignitable,
reactive; (ee) medical, biological, and biohazardous
materials, including without limitation infectious substances,
biological products, cultures and stocks, diagnostic specimen or
regulated medical waste as defined in 49 CFR sec.
173.134(a) and any other infectious materials, bodily fluids or
excrement or similar such wastes and (ff) mold, fungi, and
other allergens and (E) “Release” means
any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or
migration into or through the environment (including ambient
air, surface water, groundwater, land surface or subsurface
strata) or within any building, structure, facility or fixture.



     
SECTION 3.15. Contracts. (a) All Contracts to which
Rome or any Rome Subsidiary is a party as of the date hereof or
to which any of their respective properties or assets is subject
as of the date hereof that are required pursuant to
Item 601 of Regulation S-K under the Exchange Act to
be filed as an exhibit to any Available Rome SEC Document have
been filed as an exhibit to such Available Rome SEC Document
(such filed Contracts, the “Filed Contracts”).
To the knowledge of Rome, all the Filed Contracts are valid and
in effect, except as set forth in the Available Rome SEC
Documents, except to the extent they have previously expired or
terminated in accordance with their terms and except for any
invalidity or failure to be in effect that, individually or in
the aggregate, has not had and would not reasonably be expected
to have a Rome Material Adverse Effect. As of the date hereof,
none of Rome or any Rome Subsidiary is in violation of or
default under any Filed Contract, except as set forth in the
Available Rome SEC Documents and except for such violations or
defaults that individually or in the aggregate have not had and
would not reasonably be expected to have a Rome Material Adverse
Effect.



     
(b) Rome has made available to the Florence Parties in the
data room prepared for the Transactions true and complete copies
of (i) substantially all medical director agreements and
(ii) substantially all joint venture contracts, partnership
agreements and other agreements involving a sharing of profits,
losses, costs or liabilities of Rome or any Rome Subsidiary, in
each case to which Rome or any Rome Subsidiary is a party as of
the date of this Agreement. Rome has made available to the
Florence Parties in such data room a schedule identifying each
material agreement with a third party payor to which Rome or any
Rome Subsidiary is a party as of the date of this Agreement.



     
SECTION 3.16. Intellectual Property. Rome and the Rome
Subsidiaries own, or are validly licensed or otherwise have the
right to use, all patents, patent rights, trademarks, trademark
rights, trade names, trade name rights, service marks, service
mark rights, copyrights and other proprietary intellectual
property rights and computer programs (collectively,
“Intellectual Property Rights”) that are used
or held for use in the conduct of the business of Rome and the
Rome Subsidiaries as of the date hereof, except to the extent
that the failure to own or have the right to use any such
Intellectual Property Right, individually or in the aggregate,



14







 




has not had or would not reasonably be expected to have a Rome
Material Adverse Effect. To the knowledge of Rome, none of Rome
or any Rome Subsidiary is infringing the rights of any person
with regard to any Intellectual Property Right, except for any
infringement that, individually or in the aggregate, has not had
and would not reasonably be expected to have a Rome Material
Adverse Effect. No claims are pending or, to the knowledge of
Rome, threatened alleging that Rome or any Rome Subsidiary is
infringing or otherwise adversely affecting the rights of any
person with regard to any Intellectual Property Right, except
for any pending or threatened claims that, individually or in
the aggregate, have not had and would not reasonably be expected
to have a Rome Material Adverse Effect. To the knowledge of
Rome, no person is infringing the rights of Rome or any Rome
Subsidiary with respect to any Intellectual Property Right,
except for any infringement that, individually or in the
aggregate, has not had and would not reasonably be expected to
have a Rome Material Adverse Effect.



     
SECTION 3.17. Assets. Except as set forth in the
Available Rome SEC Documents, Rome or a Rome Subsidiary has good
title to, or valid leasehold interests in, all of the properties
and assets (other than Intellectual Property Rights which are
addressed in Section 3.16) that are used in the conduct of
the business of Rome and the Rome Subsidiaries as of the date
hereof and reflected as assets on the most recent consolidated
balance sheet of Rome and the Rome Subsidiaries included in the
Available Rome SEC Documents, except (i) for inventories
and other assets as have been exhausted or disposed of in the
ordinary course of business and (ii) for any defects in
title, easements, restrictive covenants and similar encumbrances
or impediments that, individually or in the aggregate, have not
had and would not reasonably be expected to have a Rome Material
Adverse Effect. Except as set forth in the Available Rome SEC
Documents, all such assets and properties, other than assets and
properties in which Rome or any of the Rome Subsidiaries has
leasehold interests, are owned by Rome or a Rome Subsidiary free
and clear of all Liens, except for Liens that, individually or
in the aggregate, have not had and would not reasonably be
expected to have a Rome Material Adverse Effect.



     
SECTION 3.18. Brokers. No broker, investment banker,
financial advisor or other person, other than Banc of America
Securities LLC and Morgan Stanley & Co., the fees and
expenses of which will be paid by Rome, is entitled to any
broker’s, finder’s, financial advisor’s or other
similar fee or commission in connection with the Merger and the
other Transactions based upon arrangements made by or on behalf
of Rome.



     
SECTION 3.19. Opinion of Financial Advisor. Rome has
received the opinion of Morgan Stanley & Co. Incorporated,
dated May 3, 2005, to the effect that, as of such date, the
consideration to be received in the Merger by the holders of
Rome Common Stock is fair from a financial point of view.



     
SECTION 3.20. Fraud and Abuse Stark; False Claims; HIPAA;
Medicare Program. To the knowledge of Rome and except for
matters that, individually or in the aggregate, have not had and
would not reasonably be expected to have a Rome Material Adverse
Effect: (A) none of Rome and the Rome Subsidiaries,
(B) none of the predecessors of Rome and the Rome
Subsidiaries in respect of any dialysis or other business to
which Rome or any Rome Subsidiary succeeded and (C) no
person or entity providing professional, billing, management
and/or marketing services to or on behalf of Rome or any Rome
Subsidiary has engaged in any activities that are prohibited
under 42 U.S.C. Section 1320a-7b, 42 U.S.C.
Section 1320a-7, 42 U.S.C. Section 1395nn or
31 U.S.C. Section 3729-3733 (or any other federal or
state statute related to false or fraudulent claims) or the
regulations promulgated under such statutes including but not
limited to the following: (a) knowingly and willfully
making or causing to be made a false statement or representation
of a fact in any application for any benefit or payment from any
federal or state health care program, including Medicare and
Medicaid, (b) knowingly and willfully making or causing to
be made any false statement or representation of a fact for use
in determining rights to any benefit or payment from any federal
or state health care program, including Medicare and Medicaid,
(c) failing to disclose knowledge by a claimant of the
occurrence of any event affecting the initial or continued right
to any benefit or payment on its own behalf or on behalf of
another, with intent fraudulently to secure any benefit or
payment from any federal or state health care program, including
Medicare and Medicaid and (d) knowingly and willfully
soliciting, offering, paying or receiving any remuneration
(including any kickback, bribe or rebate), directly or
indirectly, overtly or covertly, in cash or in kind or offering
to pay or receive such remuneration (i) in return for
referring an individual to a person for the furnishing or
arranging for the furnishing of any item or service for which



15







 




payment may be made in whole or in part by any federal or state
health care program, including Medicare and Medicaid, or
(ii) in return for purchasing, leasing or ordering or
arranging for or recommending purchasing, leasing, or ordering
any good, facility, service or item for which payment may be
made in whole or in part by any federal or state health care
program, including Medicare and Medicaid. To the knowledge of
Rome and except for matters that, individually or in the
aggregate, have not had and would not reasonably be expected to
have a Rome Material Adverse Effect: (1) none of Rome, the
Rome Subsidiaries and their respective predecessors in respect
of any dialysis or other business to which any of Rome and the
Rome Subsidiaries have succeeded has engaged in activities that
are prohibited under the applicable administrative
simplification provisions of the Health Insurance Portability
and Accountability Act of 1996, including the criminal
provisions thereunder related to federal health care offenses,
or any regulations promulgated thereunder (collectively,
“HIPAA”), and (2) Rome and the Rome Subsidiaries
are in compliance with HIPAA, including applicable HIPAA
administrative simplification provisions and the standards and
regulations regarding privacy, security and transaction and code
set standards, as well as applicable state laws and regulations
respecting privacy and data security. Except as set forth in the
Available Rome SEC Documents, the dialysis centers of Rome and
the Rome Subsidiaries that are currently operating and accepting
patients under the Medicare Program are providers in good
standing with the Medicare Program, except for such failures to
be in good standing that individually or in the aggregate have
not had and would not reasonably be expected to have a Rome
Material Adverse Effect.




ARTICLE IV




Representations and Warranties of the Florence Parties



     
The Florence Parties, jointly and severally, represent and
warrant to Rome that, except as set forth in the letter, dated
as of the date of this Agreement, from the Florence Parties to
Rome (the “Florence Parties’ Disclosure
Letter”):



     
SECTION 4.01. Organization, Standing and Power.
(a) Each of Fresenius AG, a corporation organized under the
laws of the Federal Republic of Germany and the controlling
shareholder of FME AG (“Florence Parent”), and
FME AG is a stock corporation duly organized and validly
existing under the laws of the Federal Republic of Germany. FME
is a corporation duly organized and validly existing under the
laws of the State of New York. Sub is a corporation duly
organized and validly existing under the laws of the State of
Delaware. Each of Florence Parent, FME AG, FME and Sub has full
corporate power and authority and possesses all governmental
franchises, licenses, permits, authorizations and approvals
necessary to enable it to own, lease or otherwise hold its
properties and assets and to conduct its businesses as presently
conducted, other than such franchises, licenses, permits,
authorizations and approvals the lack of which, individually or
in the aggregate, has not had and would not reasonably be
expected to have a Florence Material Adverse Effect (as defined
below). For purposes of this Agreement: a “Florence
Material Adverse Effect” means (A) a material
adverse effect on the ability of any of the Florence Parties to
perform their respective obligations under this Agreement or
(B) a material adverse effect on the ability of FME or Sub
to consummate the Merger or any Florence Party to consummate the
other Transactions.



     
(b) The Florence Parties have made available to Rome true
and complete copies of (i) Articles of Association of
Florence Parent, as amended to the date of this Agreement (as so
amended, the “Florence Parent Charter”),
together with an English-language translation thereof,
(ii) the Articles of Association of FME AG, as amended to
the date of this Agreement (as so amended, the “FME AG
Charter”), together with an English-language
translation thereof, (iii) the Certificate of Incorporation
and bylaws of FME, in each case as amended to the date of this
Agreement (as so amended, the “FME Charter”) and
(iv) the certificate of incorporation and by-laws of Sub,
in each case as amended through the date of this Agreement.



     
SECTION 4.02. Sub. (a) Since the date of its
incorporation, Sub has not carried on any business or conducted
any operations other than the execution of this Agreement, the
performance of its obligations hereunder and matters ancillary
thereto.



16







 



     
(b) The authorized capital stock of Sub consists of 3,000
shares of common stock, par value $0.01 per share. At the
close of business on May 2, 2005, 100 shares of Sub
common stock were outstanding, all of which have been validly
issued, are fully paid and nonassessable, and are owned by FME
free and clear of any Liens.



     
SECTION 4.03. Authority; Execution and Delivery;
Enforceability. (a) Each Florence Party has all
requisite corporate power and authority to execute and deliver
this Agreement and to consummate the Transactions. The execution
and delivery by each Florence Party of this Agreement and the
consummation by it of the Transactions have been duly authorized
by all necessary corporate action on the part of such Florence
Party. Each Florence Party has duly executed and delivered this
Agreement, and this Agreement constitutes its legal, valid and
binding obligation, enforceable against it in accordance with
its terms.



     
(b)Each of the Supervisory Board of Florence Parent, the
Managing Board of Florence Parent, the Supervisory Board of FME
AG, the Managing Board of FME AG, and the Board of Directors of
FME at a meeting of such body duly called and held, or pursuant
to a written consent in lieu of such meeting, as the case may
be, duly adopted resolutions approving this Agreement, the
Merger and the other Transactions.



     
(c) FME, as sole stockholder of Sub, has adopted this
Agreement.



     
(d) No consent of, or approval or adoption by, the holders
of any class of capital stock of Florence Parent, FME AG or of
FME is required for the execution and delivery of this Agreement
and the consummation of the Merger and the other Transactions.



     
SECTION 4.04. No Conflicts; Consents. (a) The
execution and delivery by each Florence Party of this Agreement,
do not, and the consummation of the Merger and the other
Transactions and compliance with the terms hereof will not,
conflict with, or result in any violation of or default (with or
without notice or lapse of time, or both) under, or give rise to
a right of termination, cancelation or acceleration of any
obligation or to loss of a material benefit under, or result in
the creation of any Lien upon any of the properties or assets of
any Florence Party or any of their respective subsidiaries
under, any provision of (i) the Florence Parent Charter,
the FME AG Charter, the FME Charter, certificate of
incorporation or by-laws of Sub or the charter or organizational
documents of any subsidiary of FME other than Sub, (ii) any
Contract to which any Florence Party or any of their respective
subsidiaries is a party or by which any of their respective
properties or assets is bound, or (iii) subject to the
filings and other matters referred to in Section 4.04(b),
any Judgment or Law applicable to any Florence Party or any of
their respective subsidiaries or their respective properties or
assets, other than, in the case of clauses (ii) and
(iii) above, any such items that, individually or in the
aggregate, have not had and would not reasonably be expected to
have a Florence Material Adverse Effect.



     
(b) No Consent of, or registration, declaration or filing
with, any Governmental Entity is required to be obtained or made
by or with respect to any Florence Party or any of their
respective subsidiaries in connection with the execution,
delivery and performance of this Agreement or the consummation
of the Transactions, other than (i) compliance with and
filings under the HSR Act, (ii) the filing with the SEC of
(A) the Proxy Statement and (B) such reports under
Sections 13 and 16 of the Exchange Act, as may be required
in connection with this Agreement, the Merger and the other
Transactions, (iii) the filing of the Certificate of Merger
with the Secretary of State of the State of Delaware,
(iv) such filings as may be required under applicable
Environmental Laws, (v) such filings as may be required in
connection with the taxes described in Section 6.09,
(vi) such of the foregoing as may be required in connection
with the Financing (as defined in Section 4.07(a)) and
(vii) such other items (A) required solely by reason
of the participation of Rome (as opposed to any third party) in
the Transactions or (B) the failure of which to be obtained
or made, individually or in the aggregate, have not had and
would not reasonably be expected to have a Florence Material
Adverse Effect.



     
SECTION 4.05. Information Supplied. None of the
information supplied in writing or to be supplied in writing by
any Florence Party for inclusion or incorporation by reference
in the Proxy Statement will, at the date it is first mailed to
Rome’s stockholders or at the time of the Rome Stockholders
Meeting, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of
the circumstances under which they are made, not



17







 




misleading; provided, that no representation is made by
the Florence Parties with respect to statements made or
incorporated by reference in any of the foregoing documents
based on information supplied by Rome for inclusion or
incorporation by reference therein.



     
SECTION 4.06. Brokers. No broker, investment banker,
financial advisor or other person, other than Deutsche Bank, the
fees and expenses of which will be paid by a Florence Party, is
entitled to any broker’s, finder’s, financial
advisor’s or other similar fee or commission in connection
with the Merger and the other Transactions based upon
arrangements made by or on behalf of the Florence Parties.



     
SECTION 4.07. Financing. (a) FME AG and FME have
received a commitment letter dated April 29, 2005, from
Bank of America, N.A. and Deutsche Bank AG New York
Branch (the “Lenders”) relating to the
commitment of the Lenders to provide the financing required to
consummate the Merger and pay the Merger Consideration, to
refinance all existing indebtedness of Rome, and to pay related
fees and expenses. The financing required to consummate the
Merger and pay the Merger Consideration, to refinance all
existing indebtedness of Rome, and to pay related fees and
expenses is collectively referred to in this Agreement as the
“Financing”. FME AG has provided Rome with a
complete and correct copy of such letter (including all
attachments thereto, the Fee Letter referred to therein and all
side letters in respect thereof) (collectively, the
“Commitment Letter”). As of the date of this
Agreement, FME AG has no reason to believe that any of the
conditions to the Financing will not be satisfied or that the
funds for the Financing will not be available on a timely basis
for the transactions contemplated by this Agreement.



     
(b) Assuming Rome is not Insolvent (as defined below) prior
to the Effective Time, immediately after the Effective Time and
after giving effect to any change in the Surviving
Corporation’s assets and liabilities as a result of the
Merger, the Surviving Corporation will not (i) be insolvent
(insolvency being determined either because the financial
condition of the Surviving Corporation is such that the sum of
its debts is greater than the fair value of its assets or
because the fair saleable value of the Surviving
Corporation’s assets is less than the amount required to
pay its probable liability on existing debts as they mature),
(ii) have unreasonably small capital with which to engage
in its business, or (iii) have incurred liabilities beyond
its ability to pay as they become due. For purposes hereof, Rome
will be deemed to be “Insolvent” if any of the
conditions described in clause (i), (ii) or (iii)
above is applicable to Rome prior to the Effective Time.




ARTICLE V




Covenants Relating to Conduct of Business



     
SECTION 5.01. Conduct of Business. (a) Conduct of
Business by Rome. Except for matters set forth in the Rome
Disclosure Letter or otherwise contemplated by this Agreement,
from the date of this Agreement to the Effective Time Rome
shall, and shall cause each Rome Subsidiary to, conduct its
business in the usual, regular and ordinary course substantially
consistent with past practice. In addition, and without limiting
the generality of the foregoing, except for matters set forth in
the Rome Disclosure Letter or otherwise contemplated by this
Agreement, from the date of this Agreement to the Effective
Time, Rome shall not, and shall not permit any Rome Subsidiary
to, do any of the following without the prior written consent
of FME:






		
	 	     
    (i) (A) declare, set aside or pay any dividends on, or
    make any other distributions in respect of, any of its capital
    stock, other than pro rata dividends and distributions by a
    direct or indirect Rome Subsidiary to the holders of its capital
    stock or other equity interests, (B) split, combine or
    reclassify any of its capital stock or issue or authorize the
    issuance of any other securities in respect of, in lieu of or in
    substitution for shares of its capital stock, (C) purchase,
    redeem or otherwise acquire any shares of capital stock of Rome
    or any Rome Subsidiary or any other securities thereof or any
    rights, warrants or options to acquire any such shares or other
    securities, (D) enter into a contractual obligation to vote
    any shares of the capital stock of, or other equity or voting
    interests in, any Rome Subsidiary or (E) amend its
    certificate of incorporation, by-laws or other comparable
    charter or organizational documents;
	 
	 	     
    (ii) issue, deliver, sell, authorize or grant (A) any
    shares of its capital stock, (B) any Rome Voting Debt or
    other voting securities, (C) any securities convertible
    into or exchangeable for, or any options, warrants or rights to
    acquire, any such shares, Rome Voting Debt, voting securities or
    convertible or



18







 


		
	 	
    exchangeable securities or (D) any “phantom”
    stock, “phantom” stock rights, stock appreciation
    rights or stock-based performance units, other than the
    (1) issuance of Rome Common Stock (and associated Rome
    Rights) upon the exercise of Rome Stock Options and rights under
    the Rome ESPP (as defined in Section 6.04(e)) outstanding
    on the date of this Agreement and in accordance with their
    present terms, and (2) if applicable, the issuance of Rome
    Capital Stock upon the exercise of Rome Rights;
	 
	 	     
    (iii) enter into or complete any acquisitions (whether by
    means of merger, share exchange, consolidation, tender offer,
    asset purchase or otherwise) and other business combinations
    (collectively, “Acquisitions”) of any business
    or any corporation, partnership, association or other business
    organization or division thereof or of any additional assets
    outside the ordinary course of business in connection with the
    day to day operations of Rome and the Rome Subsidiaries, other
    than (A) the Acquisitions set forth in the Rome Disclosure
    Letters and (B) Acquisitions of any business, corporation,
    partnership, association or other business organization or
    division thereof or interest therein having a value of less than
    $20,000,000, individually, and less than $100,000,000, in the
    aggregate (provided that such aggregate limit shall be increased
    to $150,000,000 in the event that the Closing has not occurred
    on or prior to December 31, 2005); provided, that
    such Acquisition would not reasonably be expected to increase in
    any material respect the divestitures that may be required
    pursuant to Section 6.03 hereof;
	 
	 	     
    (iv) (A) other than in the ordinary course of business
    consistent with past practice with respect to employees (but not
    directors or officers of Rome or any Rome subsidiary), enter
    into, adopt, amend (except for such amendments as may be
    required by law) or terminate, in any material respect, any Rome
    Benefit Plan, or any other employee benefit plan or any
    agreement, arrangement, plan or policy between Rome or a Rome
    Subsidiary and one or more of its directors, officers or
    employees, (B) except as required by any plan or
    arrangement as in effect as of the date hereof, and except for
    normal payments, awards and increases in the ordinary course of
    business consistent with past practice with respect to employees
    (but not directors and officers of Rome or any Rome Subsidiary),
    increase in any manner the compensation or fringe benefits of
    any director, officer or employee or pay any benefit not
    required by any contract, plan or arrangement as in effect as of
    the date hereof or enter into any contract, agreement,
    commitment or arrangement to do any of the foregoing;
    provided, however, that notwithstanding the
    foregoing, Rome may, with the approval of the Florence Parties
    (such approval not to be unreasonably withheld or delayed),
    increase the compensation (excluding severance benefits) of
    directors and officers of Rome or any Rome Subsidiary after
    December 31, 2005, consistent with past practice,
    (C) except pursuant to Section 6.04, enter into or
    renew any contract, agreement, commitment or arrangement (other
    than a renewal occurring in accordance with the terms thereof)
    providing for the payment to any director, officer or employee
    of such party of compensation or benefits contingent, or the
    terms of which are materially altered, upon the occurrence of
    any of the transactions contemplated by this Agreement,
    (D) take any action to provide that the consummation of the
    Merger shall result in the acceleration or other modification of
    (x) the vesting or other material terms of any Rome Stock
    Option, restricted stock award or unit or other equity related
    award or (y) other benefits under any Rome Benefit Plan
    except to the extent that such acceleration or other
    modification is consistent with the terms as of the date of this
    Agreement of such Rome Stock Option, other award or unit or Rome
    Benefit Plan, or (E) establish, adopt, enter into or amend
    in any material respect any collective bargaining agreement,
    except as required by Law or in the ordinary course of business
    consistent with past practice;
	 
	 	     
    (v) make any change in financial or tax accounting methods,
    principles or practices materially affecting the reported
    consolidated assets, liabilities or results of operations of
    Rome and the Rome Subsidiaries, except insofar as may have been
    required by a change in GAAP or concurred with by Rome’s
    independent auditors;
	 
	 	     
    (vi) sell, lease (as lessor), license, assign or otherwise
    dispose of or subject to any Lien any properties or assets
    (including capital stock of subsidiaries and indebtedness of
    others) that are material, individually or in the aggregate, to
    Rome and the Rome Subsidiaries, taken as a whole, except sales
    of inventory and excess or obsolete assets in the ordinary
    course of business consistent with past practice;




19







 






		
	 	     
    (vii) (A) incur, create or assume any indebtedness for
    borrowed money or guarantee any such indebtedness of another
    person, issue or sell any debt securities or warrants or other
    rights to acquire any debt securities of Rome or any Rome
    Subsidiary, guarantee any debt securities of another person,
    enter into any “keep well” or other agreement to
    maintain any financial statement condition of another person or
    enter into any arrangement having the economic effect of any of
    the foregoing, except for short-term borrowings
    (x) incurred to refinance indebtedness of Rome or the Rome
    Subsidiaries outstanding on the date of this Agreement (or to
    refinance indebtedness incurred pursuant to this clause
    (x) or clause (y)) or (y) additional short-term
    borrowings (1) incurred for general corporate purposes in
    an aggregate amount outstanding at any time not to exceed
    $30,000,000 or (2) incurred in connection with Acquisitions
    permitted pursuant to Section 5.01(a)(iii), or
    (B) make any loans, advances or capital contributions to,
    or investments in, any other person, other than to or in Rome or
    any direct or indirect wholly owned Rome Subsidiary;
	 
	 	     
    (viii) make or agree to make any new capital expenditure or
    expenditures that, individually, is in excess of $2,500,000 or,
    in the aggregate during any calendar month, are in excess of
    $7,000,000;
	 
	 	     
    (ix) change its annual Tax accounting period or make or
    change any material Tax election or settle or compromise any
    material Tax liability or refund;
	 
	 	     
    (x) (A) pay, discharge, settle or satisfy any material
    claims, material liabilities or material obligations (absolute,
    accrued, asserted or unasserted, contingent or otherwise), other
    than the payment, discharge or satisfaction, in the ordinary
    course of business consistent with past practice or in
    accordance with their terms, of liabilities reflected or
    reserved against in, or contemplated by, the most recent
    consolidated financial statements (or the notes thereto) of Rome
    included in the Available Rome SEC Documents or incurred since
    the date of such financial statements in the ordinary course of
    business consistent with past practice, (B) cancel any
    material indebtedness owed to Rome (individually or in the
    aggregate) or waive any claims or rights of substantial value,
    or (C) other than as contemplated by the last sentence of
    Section 5.02(a), waive the benefits of, or agree to modify
    in any manner, any confidentiality, standstill or similar
    agreement to which Rome or any Rome Subsidiary is a party; or
	 
	 	     
    (xi) adopt a plan of complete or partial liquidation of
    Rome or any material Rome Subsidiary or resolutions providing
    for or authorizing such a liquidation or a dissolution,
    restructuring, recapitalization or reorganization of Rome or any
    material Rome Subsidiary;
	 
	 	     
    (xii) enter into or otherwise become party to any Contract
    that contains a material non-competition covenant or similar
    restriction on the ability of Rome or FME or any of their
    respective subsidiaries to conduct, from and after the Closing,
    any of their businesses in any geographical area, except for
    customary non-competition covenants or similar restrictions
    included in joint venture agreements entered into by Rome or a
    Rome Subsidiary consistent with past practice; provided,
    that Rome shall offer FME a reasonable opportunity to review and
    approve (such approval not to be unreasonably withheld or
    delayed) any such covenant or similar restriction prior to
    Rome’s entry into or agreeing to become party to such
    Contract, and provided further that if FME does not approve any
    such Contract, Rome may enter into such Contract only if it has
    a reasonable basis for doing so.
	 
	 	     
    (xiii) settle any litigation commenced after the date
    hereof against Rome or any of its directors by any stockholder
    of Rome relating to this Agreement, the Merger, any other
    transaction contemplated hereby or thereby, without the prior
    written consent of FME, which consent shall not be unreasonably
    withheld or delayed; or
	 
	 	     
    (xiv) authorize any of, or commit or agree to take any of,
    the foregoing actions.



     
(b) Conduct of Business of FME AG. Except for matters set
forth in the Florence Parties’ Disclosure Letter or
otherwise contemplated by this Agreement, from the date of this
Agreement to the Effective Time, FME AG shall not, and shall not
permit Florence Parent or any subsidiary of Florence Parent to,
do any of the following without the prior written consent of
Rome:



20







 






		
	 	     
    (i) acquire or agree to acquire any business or any
    corporation, partnership, joint venture, association or other
    business organization or division thereof or any assets if any
    such acquisition or agreement would have or reasonably be
    expected to have a Florence Material Adverse Effect; provided
    that this Section 5.01(b)(i) shall not limit or diminish in
    any respect the Florence Parties’ obligations under
    Section 6.03; or
	 
	 	     
    (ii) authorize any of, or commit or agree to take any of,
    the foregoing actions.



     
(c) Other Actions. Except as otherwise permitted by
Section 5.02, Rome shall not, and shall not permit any Rome
Subsidiary to, take any action that would, or that would
reasonably be expected to, result in any condition to the Merger
set forth in Article VII, not being satisfied. Except as
otherwise permitted by Section 5.02, the Florence Parties
shall not, and shall not permit Florence Parent or any of its
subsidiaries to, take any action that would, or that would
reasonably be expected to, result in any condition to the Merger
set forth in Article VII, not being satisfied.



     
(d) Advice of Changes. Rome shall promptly advise the
Florence Parties orally and in writing of any change or event
that has or would reasonably be expected to have a Rome Material
Adverse Effect. The Florence Parties shall promptly advise Rome
orally and in writing of any change or event that has or would
reasonably be expected to have a Florence Material Adverse
Effect.



     
(e) Administration of Consents. Any request for a consent
of FME under Section 5.01(a), and any correspondence
between the parties with respect to such consents (including the
granting or refusal to grant any such consent) shall be made
solely by and between the person identified in
Section 5.01(e) of the Rome Disclosure Letter, on behalf of
Rome and the Rome Subsidiaries, and the person identified in
writing by FME on or prior to the date hereof, on behalf of the
Florence Parties and their respective subsidiaries.



     
(f) Control of Rome’s Business. It is understood and
agreed that the Florence Parties and their affiliates do not
have the right to control or direct Rome’s operations prior
to the Effective Time. Prior to the Effective Time, Rome shall
exercise, consistent with the terms and conditions of this
Agreement, complete control and supervision over its operations.



     
SECTION 5.02. No Solicitation. (a) Rome hereby
represents and warrants to the Florence Parties that as of the
date hereof there are no existing discussions or negotiations
between Rome and any third party or parties, other than the
Florence Parties, relating to any Takeover Proposal (as defined
in Section 5.02(e)). Rome shall not, and it shall not
authorize or permit any Rome Subsidiary to, and it shall not
authorize or permit any officer, director or employee of, or any
investment banker, attorney or other advisor or representative
(collectively, “Representatives”) of, Rome or
any Rome Subsidiary to (i) solicit, initiate or encourage
the submission of any Takeover Proposal, (ii) enter into
any agreement with respect to any Takeover Proposal or
(iii) participate in any discussions or negotiations
regarding, or furnish to any person any information with respect
to, or take any other action to facilitate any inquiries or the
making of any proposal that constitutes, or may reasonably be
expected to lead to, any Takeover Proposal; provided,
however, that Rome and its Representatives may, in
response to a Takeover Proposal that the Rome Board determines,
in good faith, could reasonably be expected to lead to a
Superior Proposal (as defined in Section 5.02(e)) that was
not solicited by Rome and that did not otherwise result from a
breach of this Section 5.02(a), and subject to compliance with
Section 5.02(c), (x) furnish information with respect
to Rome to the person making such Takeover Proposal and its
Representatives pursuant to a customary confidentiality
agreement (which, for the avoidance of doubt, need not contain
any “standstill” or similar covenant) and
(y) participate in discussions or negotiations (including
solicitation of a revised Takeover Proposal) with such person
and its Representatives regarding any Takeover Proposal. In the
event that Rome enters into a confidentiality agreement with a
person making a Takeover Proposal that does not include a
“standstill” provision or contains a
“standstill” provision substantially less favorable to
Rome than the corresponding provision of the Confidentiality
Agreement (as defined in Section 6.02), the applicable
Florence Parties and their affiliates shall, without further
action by Rome, be released from the “standstill”
provision under Section 6 of the Confidentiality Agreement
to the extent necessary to render such “standstill”
provision of the Confidentiality Agreement no more favorable to
Rome than the “standstill”, if any, applicable to the
person making such Takeover Proposal.



21







 



     
(b) Neither the Rome Board nor any committee thereof shall (i)
(A) withdraw (or modify in a manner adverse to the Florence
Parties), or publicly propose to withdraw (or modify in a manner
adverse to the Florence Parties), the adoption, approval,
recommendation or declaration of advisability by the Rome Board
or any such committee thereof of this Agreement, the Merger or
the other Transactions or (B) recommend, adopt, approve or
declare advisable, or propose publicly to recommend, adopt,
approve or declare advisable, any Takeover Proposal (any action
described in this clause (i) being referred to as an
“Adverse Recommendation Change”) or
(ii) adopt, approve, recommend or declare advisable, or
propose to adopt, approve, recommend or declare advisable, or
allow Rome or any of the Rome Subsidiaries to execute or enter
into, any letter of intent, memorandum of understanding,
agreement in principle, merger agreement, acquisition agreement,
option agreement, joint venture agreement, partnership agreement
or other similar agreement constituting or related to, or that
is intended to or would reasonably be expected to lead to, any
Takeover Proposal (other than a confidentiality agreement
referred to in Section 5.02(a)). Notwithstanding the
foregoing, at any time prior to obtaining the Rome Stockholder
Approval, the Rome Board (or the applicable committee thereof)
may make an Adverse Recommendation Change described in clause
(i)(A) above, if the Rome Board (or such committee thereof)
determines in good faith (after consultation with outside
counsel) that it is required to do so in order to comply with
applicable law, including its fiduciary duties to the
stockholders of Rome (including, but not limited to, the Rome
Board’s duties of good faith and candor to the stockholders
of Rome); provided, however, that no Adverse
Recommendation Change may be made until the expiration of a
three business day period commencing upon the Florence
Parties’ receipt of written notice (a “Notice of
Adverse Recommendation”) from Rome advising the
Florence Parties that the Rome Board intends to take such action
and specifying the reasons therefor, including the terms and
conditions of any Superior Proposal that may be the basis of the
proposed action by the Rome Board (it being understood and
agreed that (x) any amendment to the financial terms or any
other material term of any such Superior Proposal or
(y) with respect to any previous Adverse Recommendation
Change, any material change in the principal rationale stated by
the Rome Board for such previous Adverse Recommendation Change,
shall, in the case of either (x) or (y), require a new
Notice of Adverse Recommendation and a new three business day
period). In determining whether to make an Adverse
Recommendation Change, the Rome Board shall take into account
any changes to the financial terms of this Agreement proposed by
the Florence Parties in response to a Rome Notice of Adverse
Recommendation or otherwise.



     
(c) In addition to the obligations of Rome set forth in
paragraphs (a) and (b) of this Section 5.02, Rome
promptly shall advise the Florence Parties orally and in writing
of any Takeover Proposal or any inquiry with respect to or that
could reasonably be expected to lead to any Takeover Proposal
and the identity of the person making any such Takeover Proposal
or inquiry and shall provide the Florence Parties with the
material terms and conditions of any proposal that is the basis
for a proposed Adverse Recommendation Change or termination of
this Agreement by Rome pursuant to Section 8.01(f). Rome
shall keep the Florence Parties fully informed of the status of
any such Takeover Proposal or inquiry. Rome shall not be
required to comply with this Section 5.02(c) in any instance to
the extent that the Rome Board determines in good faith, that
such compliance would in such instance be a breach of their
fiduciary duties.



     
(d) Nothing contained in this Section 5.02 shall prohibit
Rome from (i) taking and disclosing to its stockholders a
position contemplated by Rule 14e-2(a) promulgated under the
Exchange Act or (ii) making any disclosure to Rome’s
stockholders if, in the good faith judgment of the Rome Board
(after consultation with outside counsel), failure so to
disclose would be inconsistent with its obligations under
applicable Law, including but not limited to the Rome
Board’s duty of candor to the stockholders of Rome;
provided, however, that in no event shall Rome or
the Rome Board or any committee thereof take, or agree or
resolve to take, any action prohibited by Section 5.02(b).
Any action taken by Rome or the Rome Board in accordance with
Section 5.02(d)(i) shall be deemed not to be a withdrawal
or modification of the Rome Board’s approval or
recommendation of the Merger and this Agreement.



     
(e) For purposes of this Agreement:






		
	 	     
    “Takeover Proposal” means any proposal or offer
    from any person relating to any direct or indirect acquisition,
    in one transaction or a series of transactions, including by way
    of any merger, consolidation, tender offer, exchange offer,
    binding share exchange, business combination, recapitalization,
    liquidation,



22







 


		
	 	
    dissolution, joint venture or similar transaction, of
    (A) assets or businesses of Rome and the Rome Subsidiaries
    that constitute or represent 15% or more of the total revenue,
    operating income, earnings before interest, taxes, depreciation
    and amortization or assets of Rome and the Rome Subsidiaries,
    taken as a whole, or (B) 15% or more of the outstanding
    shares of capital stock of Rome.
	 
	 	     
    “Superior Proposal” means any bona fide written
    offer made by a third party in respect of (i) a transaction
    that if consummated would result in such third party acquiring,
    directly or indirectly, 50% or more of the voting power of the
    outstanding Rome Common Stock or 50% or more of the assets of
    Rome and the Rome Subsidiaries, taken as a whole, or (ii) a
    merger between such third party and Rome, in either case
    providing for consideration to Rome’s stockholders
    consisting of cash and/or securities (it being understood that
    securities retained by Rome’s stockholders be included for
    purposes of this determination), which transaction the Rome
    Board determines in its good faith judgment (after consultation
    with outside counsel and a financial advisor of nationally
    recognized reputation) to be (i) more favorable to the
    holders of Rome Common Stock from a financial point of view than
    the Transactions (taking into account all the terms and
    conditions of such Takeover Proposal and this Agreement
    (including any changes to the financial terms of this Agreement
    proposed by the Florence Parties in response to such offer or
    otherwise), the form of consideration offered, the person making
    the offer, breakup fees and expense reimbursement provisions as
    well as other financial factors deemed relevant by the Rome
    Board) and (ii) reasonably capable of being completed on
    the terms proposed, taking into account all financial, legal,
    regulatory and other aspects of such Takeover Proposal.





ARTICLE VI




Additional Agreements



     
SECTION 6.01. Preparation of Proxy Statement; Stockholders
Meeting. (a) As soon as practicable following the date
of this Agreement, Rome shall, with FME’s cooperation,
prepare and file with the SEC the Proxy Statement in preliminary
form. Rome shall, with FME’s cooperation, use its best
efforts to respond as promptly as practicable to any comments of
the SEC with respect to the Proxy Statement. Rome shall, as soon
as practicable following the filing of the Proxy Statement with
the SEC, duly call, give notice of, convene and hold a meeting
of its stockholders (the “Rome Stockholders
Meeting”) for the purpose of seeking the Rome
Stockholders Approval, regardless of whether an Adverse
Recommendation Change has occurred at any time after the date of
this Agreement, and use its best efforts to cause the Proxy
Statement to be mailed to Rome’s stockholders as promptly
as practicable after filing with the SEC. Rome shall notify FME
promptly of the receipt of any comments from the SEC or its
staff and of any request by the SEC or its staff for amendments
or supplements to the Proxy Statement or for additional
information and shall supply FME with copies of all
correspondence between Rome or any of its Representatives, on
the one hand, and the SEC or its staff, on the other hand, with
respect to the Proxy Statement, the Merger, or any of the other
Transactions. Prior to filing or mailing the Proxy Statement or
responding to any comments of the SEC with respect thereto, Rome
shall (i) provide FME an opportunity to review and comment
in writing on such document or response and (ii) give
reasonable consideration to all written comments proposed by FME.



     
(b) If prior to the receipt of the Rome Stockholder
Approval, any event occurs with respect to Rome or any Rome
Subsidiary, or any change occurs with respect to other
information supplied by Rome for inclusion in the Proxy
Statement which is required to be described in an amendment of,
or a supplement to, the Proxy Statement, Rome shall promptly
notify the Florence Parties of such event, and Rome and FME
shall cooperate in the prompt filing with the SEC of any
necessary amendment or supplement to the Proxy Statement and, as
required by Law, in disseminating the information contained in
such amendment or supplement to Rome’s stockholders.



     
(c) If prior to the receipt of the Rome Stockholder
Approval, any event occurs with respect to any Florence Party or
any of their respective subsidiaries, or any change occurs with
respect to other information supplied by the Florence Parties
for inclusion in the Proxy Statement which is required to be
described in an amendment of, or a supplement to, the Proxy
Statement, the Florence Parties shall promptly notify Rome of
such event, and Rome and FME shall cooperate in the prompt
filing with the SEC, of any necessary



23







 




amendment or supplement to the Proxy Statement and, as required
by Law, in disseminating the information contained in such
amendment or supplement to Rome’s stockholders.



     
(d) Rome shall, through the Rome Board, recommend to its
stockholders that they give the Rome Stockholder Approval,
except to the extent that the Rome Board shall have withdrawn or
modified its approval or recommendation of this Agreement or the
Merger as permitted by Section 5.02. Without limiting the
generality of the foregoing, Rome agrees that its obligations
pursuant to the first sentence of this Section 6.01(d)
shall not be affected by the commencement, public proposal,
public disclosure or communication to Rome of any Takeover
Proposal.



     
(e) The Florence Parties shall cause all shares of Rome
Common Stock owned by Florence Parent, FME AG, FME or any other
subsidiary of Florence Parent to be voted in favor of the
adoption of this Agreement.



     
SECTION 6.02. Access to Information; Confidentiality.
Rome shall, and shall cause the Rome Subsidiaries to, afford to
the Florence Parties and the Representatives of the Florence
Parties, reasonable access during normal business hours during
the period prior to the Effective Time to all their respective
properties, assets, books, contracts, commitments, personnel and
records. During such period, Rome shall, and shall cause the
Rome Subsidiaries to, furnish promptly to the Florence Parties,
(a) a copy of each report, schedule, form, registration
statement and other document filed by it during such period
pursuant to the requirements of federal, state or foreign
securities laws and (b) all other information concerning
its business, properties and personnel as such other party may
reasonably request. For the purposes of this Section 6.02,
all communications, including requests for information or
access, pursuant to this Section 6.02, shall only be made
by and between a representative of each of FME, on the one hand,
and of Rome, on the other hand, which representative
(a) shall initially be the person identified on
Section 6.02 of the Florence Parties’ Disclosure
Letter for FME and the person identified on Section 6.02 of
the Rome Disclosure Letter for Rome and (b) may be replaced
with a substitute representative by either party from time to
time upon reasonable written notice to the other party.
Notwithstanding the foregoing, Rome may withhold (i) any
document or information that is subject to the terms of a
confidentiality agreement with a third party or (ii) such
portions of documents or information relating to pricing or
other matters that are highly sensitive if the exchange of such
documents (or portions thereof) or information, as determined by
Rome’s counsel, might reasonably result in antitrust
difficulties for such party (or any of its affiliates). If any
material is withheld by Rome pursuant to the proviso to the
preceding sentence, Rome shall inform the Florence Parties as to
the general nature of what is being withheld. All information
exchanged pursuant to this Section 6.02 shall be subject to
the confidentiality agreement dated March 14, 2005, between
Rome and FME (the “Confidentiality Agreement”).



     
SECTION 6.03. Standard of Efforts; Notification.
(a) Upon the terms and subject to the conditions set forth
in this Agreement, each of the parties shall, subject to
Section 6.01(a) above, and Sections 6.03(b) and
6.03(c) below, use its reasonable best efforts to take, or cause
to be taken, all actions, and to do, or cause to be done, and to
assist and cooperate with the other parties in doing, all things
necessary, proper or advisable to consummate and make effective,
in the most expeditious manner practicable, the Merger and the
other Transactions, including (i) the taking of all acts
necessary to cause the conditions precedent set forth in
Article VII to be satisfied, (ii) the obtaining of all
necessary actions or nonactions, waivers, consents and approvals
from Governmental Entities and the making of all necessary
registrations and filings (including filings with Governmental
Entities, if any) and the taking of all reasonable steps as may
be necessary to obtain an approval or waiver from, or to avoid
an action or proceeding by, any Governmental Entity,
(iii) the obtaining of all necessary consents, approvals or
waivers from third parties, (iv) the defending of any
lawsuits or other legal proceedings, whether judicial or
administrative, challenging this Agreement or the consummation
of the Transactions, including seeking to have any stay or
temporary restraining order entered by any court or other
Governmental Entity vacated or reversed, and (v) the
execution and delivery of any additional instruments necessary
to consummate the Merger and the Transactions and to fully carry
out the purposes of this Agreement. In connection with and
without limiting the foregoing, (i) Rome and the Rome Board
shall (A) take all action necessary to ensure that no state
takeover statute or similar statute or regulation is or becomes
applicable to the Merger or any Transaction or this Agreement,
and (B) if any state takeover statute or similar statute or
regulation becomes applicable to this Agreement, take all action
necessary to ensure that



24







 




the Merger and the other Transactions may be consummated as
promptly as practicable on the terms contemplated by this
Agreement and otherwise to minimize the effect of such statute
or regulation on the Merger and the other Transactions, and
(ii) Rome and the Rome Board shall cooperate with the
Florence Parties in the arrangements for obtaining the Financing
and the Florence Parties shall keep Rome and the Rome Board
informed about the status of the Financing, including providing
prompt notice to Rome of any material developments with respect
thereto. Notwithstanding the foregoing, Rome and its
Representatives shall not be prohibited under this
Section 6.03(a) from taking any action permitted by
Section 5.02.



     
(b) In furtherance and not in limitation of the other
provisions of this Section 6.03, each of the Florence
Parties and Rome agrees to make, and the Florence Parties agree
to cause Florence Parent to make, an appropriate filing of a
notification and report form pursuant to the HSR Act (and to
make such other filings as are required under laws in foreign
jurisdictions governing antitrust or merger control matters
(together with the HSR Act, “Antitrust Laws”))
with respect to the Merger and the Transactions as promptly as
practicable after the date of this Agreement but in any event
not later than fifteen (15) business days after the date of
this Agreement, and to supply as promptly as practicable any
additional information and documentary material that may be
requested pursuant to Antitrust Laws. Each of the Florence
Parties and Rome will use its best efforts to cause, and the
Florence Parties shall cause Florence Parent to use its best
efforts to cause, the expiration or termination of the
applicable waiting periods under the HSR Act and the receipt of
required approvals under Antitrust Laws as soon as practicable.
The parties hereto agree not to extend, and the Florence Parties
shall cause Florence Parent not to extend, directly or
indirectly any waiting period under the HSR Act or enter into
any agreement with a Governmental Entity to delay or not to
consummate the Merger and the Transactions, except with the
prior written consent of the other parties hereto. Each of the
Florence Parties and Rome will, and the Florence Parties will
cause Florence Parent to, (x) promptly notify the other
party of any written communication to that party from any
Governmental Entity located in the United States and, to the
extent practicable, outside of the United States and, subject to
applicable Law, if practicable, permit the other party to review
in advance any proposed written communication to any such
Governmental Entity and incorporate the other party’s
reasonable comments, (y) not agree to participate in any
substantive meeting or discussion with any such Governmental
Entity in respect of any filing, investigation or inquiry
concerning this Agreement, the Merger or the other Transactions
unless it consults with the other party in advance and, to the
extent permitted by such Governmental Entity, gives the other
party the opportunity to attend, and (z) furnish the other
party with copies of all correspondence, filings and written
communications between them and their affiliates and their
respective Representatives on one hand, and any such
Governmental Entity or its staff on the other hand, with respect
to this Agreement, the Merger and the other Transactions. If any
administrative or judicial action or proceeding is instituted
(or threatened to be instituted) challenging the Merger or the
Transactions contemplated by this Agreement as violative of any
Antitrust Law, or if any statute, rule, regulation, executive
order, decree, injunction or administrative order is enacted,
entered, promulgated or enforced by a Governmental Entity that
would make the Merger or the other Transactions illegal or would
otherwise prohibit or materially impair or delay the
consummation of the Merger or the other Transactions, each of
the Florence Parties shall, and shall cause Florence Parent to,
use its best efforts, including selling, holding separate or
otherwise disposing of or conducting its business in a specified
manner, or agreeing to sell, hold separate or otherwise dispose
of or conduct its business in a specified manner or permitting
the sale, holding separate or other disposition of, any assets
of the Florence Parties, Florence Parent, or their respective
subsidiaries, or after the Closing, Rome or the Rome
Subsidiaries, or the conducting of its business in a specified
manner, to contest and resist any such action or proceeding and
shall, and shall cause Florence Parent to, use its best efforts
to have vacated, lifted, reversed or overturned any decree,
judgment, injunction or other order, whether temporary,
preliminary or permanent, that is in effect and that prohibits,
prevents or restricts consummation of the Merger or the other
Transactions and to have such statute, rule, regulation,
executive order, decree, injunction or administrative order
repealed, rescinded or made inapplicable so as to permit
consummation of the Transactions. Rome will cooperate with the
Florence Parties in all respects in the Florence Parties’
or Florence Parent’s implementation of any of the measures
described in the preceding sentence that is undertaken in order
to permit consummation of the Merger or the Transactions
(including entering into agreements or taking such other actions
prior to the Closing as the Florence Parties reasonably request
to dispose of assets of Rome and the Rome Subsidiaries;
provided, that



25







 




neither Rome nor any Rome Subsidiary shall be required pursuant
to this Section 6.03 to complete any disposition of the
assets of Rome or a Rome Subsidiary prior to the Closing or
enter into any agreement or other arrangement for a disposition
of any assets of Rome or a Rome Subsidiary that does not
expressly provide that Rome’s obligation to complete such
disposition is subject to the prior or simultaneous occurrence
of the Closing).



     
(c) In furtherance and not in limitation of the other
provisions of this Section 6.03, the Florence Parties shall
use their best efforts to (i) enter into definitive
agreements with respect to, and to obtain funding under, the
Financing provided for in the Commitment Letter and
(ii) subject to Rome’s obligations under the last
sentence of this Section 6.03(c), take any and all actions
necessary to satisfy the conditions precedent set forth in such
definitive agreements. In the event that any portion of such
Financing becomes unavailable, in the manner or from the sources
originally contemplated, the Florence Parties shall use their
best efforts to obtain any such portion on substantially
comparable terms to the Financing provided for in the Commitment
Letter from alternative sources. In the event that any portion
of the Financing becomes unavailable on terms substantially
comparable to the Financing provided for in the Commitment
Letter, despite the Florence Parties use of their best efforts
pursuant to the preceding sentence, then the Florence Parties
shall use their reasonable best efforts to obtain any such
portion on such other terms as are available from alternative
sources. Rome shall use its best efforts (provided that the
effectiveness of any actions taken pursuant to this sentence
shall be expressly conditioned on consummation of the Merger) to
(i) take actions reasonably requested in writing by the
Florence Parties that are necessary to facilitate the Financing,
including actions with respect to Rome’s Credit Agreement,
dated as of February 10, 2004, among the parties named
therein and (ii) to satisfy the conditions precedent in the
Commitment Letter to the extent such conditions relate to Rome
or are within the control of Rome; provided that in connection
with any effort by the Florence Parties to obtain financing from
alternative sources as contemplated by the immediately preceding
sentence, Rome shall be required, consistent with the Florence
Parties obligations, to use its reasonable best efforts.



     
(d) Rome shall give prompt notice to the Florence Parties,
and the Florence Parties shall give prompt notice to Rome, of
(i) any representation or warranty made by it contained in
this Agreement that is qualified as to materiality becoming
untrue or inaccurate in any respect or any such representation
or warranty that is not so qualified becoming untrue or
inaccurate in any material respect or (ii) the failure by
it to comply with or satisfy in any material respect any
covenant, condition or agreement to be complied with or
satisfied by it under this Agreement; provided,
however, that no such notification shall affect the
representations, warranties, covenants or agreements of the
parties or the conditions to the obligations of the parties
under this Agreement.



     
SECTION 6.04. Stock Options. (a) Prior to the
Effective Time, the Rome Board (or, if appropriate, any
committee administering the Rome Stock Plans) shall adopt such
resolutions or take such other actions as are required to adjust
the terms of all outstanding Rome Stock Options to provide that
(i) each Rome Stock Option shall be vested and exercisable
effective immediately prior to the Effective Time, and
(ii) each Rome Stock Option that is not exercised prior to
the Effective Time will be canceled as of the Effective Time and
the holder thereof shall then become entitled to receive, as
soon as practicable following the Effective Time, a single lump
sum cash payment equal to the product of (x) the number of
shares of Rome Stock for which such Rome Stock Option shall not
theretofore have been exercised and (y) the excess, if any,
of the Merger Consideration over the exercise price per share of
such Rome Stock Option.



     
(b) All amounts payable pursuant to this Section 6.04
shall be subject to any required withholding of Taxes and shall
be paid without interest.



     
(c) Within seven (7) calendar days after the date of
this Agreement, the Rome Board of Directors (or, if appropriate,
any committee administering the Rome ESPP), shall adopt such
resolutions or take such other actions as may be required to
provide that (i) no offering period shall be commenced
after the date of this Agreement, (ii) each
participant’s outstanding right to purchase shares of Rome
Common Stock under the Rome ESPP shall terminate as soon as
practicable following the date of this Agreement (but in no
event later than the last day of each applicable payroll period
that includes the date of this Agreement), provided that
all amounts allocated to each participant’s account under
the Rome ESPP as of such date shall thereupon be used to
purchase from Rome whole shares of Rome Common Stock at the
applicable price determined under



26







 




the terms of the Rome ESPP for then outstanding offering period
and (iii) the Rome ESPP shall terminate immediately
following such purchases of Rome Common Stock.



     
(d) The Rome Stock Plans shall terminate as of the
Effective Time, and the provisions in any other Benefit Plan
providing for the issuance, transfer or grant of any capital
stock of Rome or any interest in respect of any capital stock of
Rome shall be deleted as of the Effective Time, and Rome shall
ensure that following the Effective Time no holder of a Rome
Stock Option or any participant in any Rome Stock Plan or other
Rome Benefit Plan shall have any right thereunder to acquire any
capital stock of Rome or the Surviving Corporation.



     
(e) In this Agreement:






		
	 	     
    “Rome Non-Plan Stock Option” means any option
    to purchase Rome Common Stock granted by Rome (other than any
    Rome Plan Stock Option).
	 
	 	     
    “Rome Plan Stock Option” means any option to
    purchase Rome Common Stock granted under any Rome Stock Plan
    (excluding rights under the ESPP).
	 
	 	     
    “Rome Stock Option” means any Rome Non-Plan
    Stock Option or Rome Plan Stock Option.
	 
	 	     
    “Rome Stock Plans” means Rome’s Amended
    and Restated 1999 Long-Term Incentive Plan, 2004 Stock and
    Incentive Compensation Plan, Fourth Amended and Restated 1996
    Stock Incentive Plan, the 1996 Stock Option Plan for Outside
    Directors, the Employee Stock Purchase Plan, as amended and
    restated effective July 1, 1997 (the “Rome
    ESPP”), the 1995 Equity Compensation Plan and the RDM
    Plan.



     
SECTION 6.05. Benefit Plans. (a) For purposes
hereof, “Rome Employees” shall mean those
individuals who are common law employees of Rome and the Rome
Subsidiaries (including those employees who are on vacation,
disability or maternity leave, or other leave of absence) as of
the Effective Time.



     
(b) Subject to applicable Law, the Florence Parties shall,
and shall cause the Surviving Corporation to, give the Rome
Employees full credit, for all purposes, under any employee
benefit plans or arrangements maintained by the Florence
Parties’ business in the United States, the Surviving
Corporation and their respective subsidiaries for the Rome
Employees’ service with Rome and the Rome Subsidiaries to
the same extent recognized by Rome and the Rome Subsidiaries
immediately prior to the Effective Time, except for purposes of
(i) benefit accrual under defined benefit pension plans
both (A) in which the Rome Employees do not participate
immediately prior to the Effective Time and (B) to which no
liabilities with respect to the Rome Employees are transferred
from any defined benefit pension plans in which Rome Employees
do participate immediately prior to the Effective Time and
(ii) eligibility for benefits under post-retirement health
and life insurance plans in which Rome Employees do not
participate immediately prior to the Effective Time. The
Florence Parties, jointly and severally, represent and warrant
to Rome that the Florence Parties’ do not currently
maintain any post-retirement health or life insurance plans for
the benefit of the Florence Parties’ employees in the
United States.



     
(c) Subject to applicable Law, the Florence Parties shall,
and shall cause the Surviving Corporation to, (i) waive all
limitations as to preexisting conditions, exclusions,
actively-at-work requirements and waiting periods applicable to
the Rome Employees and, to the extent applicable, any retired
employees of Rome or the Rome Subsidiaries (each a
“Retired Employee”) under any welfare benefit
plans in which such employees may be eligible to participate
from and after the Effective Time, except to the extent that
such waiting periods, pre-existing condition limitations,
exclusions and actively-at-work requirements would have been
applicable under the comparable Rome welfare benefit plan
immediately prior to the Effective Time and (ii) provide
each Rome Employee (and each Retired Employee) with credit for
any co-payments and deductibles paid prior to the Effective Time
in the calendar year in which the Effective Time occurs in
satisfying any applicable deductible or out-of-pocket
requirements in the calendar year in which the Effective Time
occurs, under any welfare plans in which such Rome Employee (and
each Retired Employee) is eligible to participate after the
Effective Time.



27







 



     
(d) Subject to applicable Law, for a period of two years
immediately following the Effective Time, the Florence Parties
shall, or shall cause the Surviving Corporation to, provide to
each of the Rome Employees (who are not members of Rome’s
senior management listed in Section 6.05(d) of the Rome
Disclosure Letter (“Rome Senior Management”))
employee benefits (including health, welfare, pension, vacation,
savings and severance) that are no less favorable in the
aggregate than those provided to the Rome Employees (who are not
Rome Senior Management) immediately prior to the Effective Time.
Notwithstanding any provision to the contrary, following the
Effective Time, there shall be no obligation to provide Rome
Employees with awards of capital stock of any entity or awards
of options or other rights of any kind to acquire capital stock
of any entity; provided, however, the Florence
Parties may, in their discretion, offer such awards on a basis
that is consistent with such awards available to employees of
the Florence Parties principally employed in the United States
who are not members of the Florence Parties’ senior
management listed in Section 6.05(d) of the Florence
Parties’ Disclosure Letter; provided, that Rome
Senior Management shall be entitled to participate in any plans
or arrangements made available the Rome Employees generally.
Notwithstanding any provision herein to the contrary, none of
the Florence Parties, the Surviving Corporation or any of their
affiliates shall have any obligation to continue to employ any
Rome Employees other than on an “at will” basis except
as otherwise may be required under any employment agreements.
Additionally, notwithstanding any provision herein to the
contrary, none of the Florence Parties, the Surviving
Corporation, any affiliates, or any successors shall have any
obligation to make provision for any benefits for any period of
time with respect to any Rome Employees of any entities that
have been divested in any manner from the Florence Parties, the
Surviving Corporation, any affiliates, or any successors
following the date of such divestiture.



     
(e) Notwithstanding anything herein to the contrary, prior
to the Effective Time, the Rome Board or, if appropriate, any
committee thereof administering the applicable plan, policy or
program shall adopt such resolutions or take such other actions
as may be required to (i) terminate accruals under the Rome
Supplemental Executive Retirement Plan (the
“SERP”) immediately prior to the day on which
the Effective Time occurs so that the benefits for any
participant in the SERP are determined without regard to any
period of employment after the earlier of the Effective Time or
the date of the participant’s actual termination of
employment; and (ii) terminate any and all unwritten
severance, deferred compensation or termination plans, policies
or programs immediately prior to the day on which the Effective
Time occurs, and to notify the employees prior to the Effective
Time who are covered by such plans, policies and programs that
they will terminate as of the Effective Time. FME shall honor
and continue or cause to be honored and continued the Renal Care
Group, Inc. 401(k) Employer Retirement Plan that is intended to
be tax qualified through the end of the “transition
period” described in Code Section 410(b)(6)(C)(ii) and
FME shall honor any and all employment agreements listed in the
Rome Disclosure Letter after the Effective Time in accordance
with their terms.



     
SECTION 6.06. Indemnification. (a) FME shall, to the
fullest extent permitted by Law, cause the Surviving Corporation
to honor all Rome’s obligations to indemnify (including any
obligations to advance funds for expenses) the current or former
directors or officers of Rome for acts or omissions by such
directors and officers occurring prior to the Effective Time to
the extent that such obligations of Rome exist on the date of
this Agreement, whether pursuant to the Rome Charter, the Rome
By-laws, individual indemnity agreements or otherwise, and such
obligations shall survive the Merger and shall continue in full
force and effect in accordance with the terms of the Rome
Charter, the Rome By-laws and such individual indemnity
agreements from the Effective Time until the expiration of the
applicable statute of limitations with respect to any claims
against such directors or officers arising out of such acts or
omissions.



     
(b) For a period of six years after the Effective Time, FME
shall cause to be maintained in effect the current policies of
directors’ and officers’ liability insurance
maintained by Rome (provided that FME may substitute therefor
policies with reputable and financially sound carriers of at
least the same coverage and amounts containing terms and
conditions which are no less advantageous) with respect to
claims arising from or related to facts or events which occurred
at or before the Effective Time; provided, however, that
in no event shall FME be required to maintain such current
policies if it is required to pay aggregate annual premiums for
insurance under this Section 6.06(b) in excess of 225% of
the amount of the aggregate premiums paid by Rome for the year
from March 1, 2004 through February 28, 2005 for such
purpose. Rome



28







 




hereby represents and warrants that the premiums for such
insurance for the year from March 1, 2004 through
February 28, 2005 were $1,322,181. In the event that FME is
required to pay in excess of such amount, it shall only be
obligated to provide a policy with the best coverage FME is
reasonably able to obtain for such 225% amount.



     
(c) From and after the Effective Time, to the fullest extent
permitted by Law, the Florence Parties shall, jointly and
severally, and shall cause the Surviving Corporation to,
indemnify, defend and hold harmless the present and former
officers and directors of Rome and the Rome Subsidiaries and any
employee of Rome or any Rome Subsidiary who, as of the date of
this Agreement, acts as a fiduciary under any Rome Benefit Plan
(each an “Indemnified Party”) against all
losses, claims, damages, liabilities, fees and expenses
(including attorneys’ fees and disbursements), judgments,
fines and amounts paid in settlement (in the case of
settlements, with the approval of the indemnifying party (which
approval shall not be unreasonably withheld)) (collectively,
“Losses”), as incurred (payable monthly upon
written request, which request shall include reasonable evidence
of the Losses set forth therein) to the extent arising from,
relating to, or otherwise in respect of, any actual or
threatened action, suit, proceeding or investigation, in respect
of actions or omissions occurring at or prior to the Effective
Time in connection with such Indemnified Party’s duties as
an officer or director of Rome or any of its subsidiaries,
including in respect to this Agreement, the Merger and the other
Transactions; provided, however, that an
Indemnified Party shall not be entitled to indemnification under
this Section 6.06(c) for Losses arising out of actions or
omissions by the Indemnified Party constituting (i) a
breach of this Agreement, (ii) criminal conduct or
(iii) any violation of federal, state or foreign securities
laws and provided, further, that no Florence Party
shall have any liability pursuant to this Section 6.06(c)
with respect to any claims that are solely for money damages and
as to which the Florence Parties have acknowledged in writing
their indemnification obligations hereunder that are settled by
the applicable Indemnified Party without the consent of FME, not
to be unreasonably withheld or delayed.



     
SECTION 6.07. Fees and Expenses. (a) Except as
provided below, all fees and expenses incurred in connection
with the Merger and the other Transactions shall be paid by the
party incurring such fees or expenses, whether or not the Merger
is consummated.



     
(b) Rome shall pay to FME a fee of $96,250,000 if: (i) the
Florence Parties terminate this Agreement pursuant to
Section 8.01(e); (ii) Rome terminates this Agreement
pursuant to Section 8.01(f); or (iii) (A) after the
date of this Agreement and prior to a duly held meeting to
obtain the Rome Stockholder Approval, any person makes a
Takeover Proposal (which has not been withdrawn), (B) this
Agreement is terminated (x) pursuant to
Section 8.01(b)(iii) as a result of the failure to obtain
the Rome Stockholder Approval at such meeting, or
(y) pursuant to Section 8.01(c) as a result of
(I) a material breach by Rome of a covenant contained in
this Agreement, (II) a material breach by Rome as of the
date of this Agreement of a representation or warranty contained
in this Agreement or (III) a wilful material breach by Rome
after the date of this Agreement of a representation or warranty
contained in this Agreement and required by Section 7.02(a)
to be true and correct as of the Closing Date and
(C) within one year of such termination Rome enters into a
definitive agreement to consummate, or consummates, the
transactions contemplated by such Takeover Proposal.



     
(c) Any fee due under Section 6.07(b) shall be paid by wire
transfer of same-day funds: (i) on the date of termination
of this Agreement, in the case of Section 6.07(b)(i) or
6.07(b)(ii) and (ii) on the date of execution of such
definitive agreement or, if earlier, consummation of such
transactions, in the case of Section 6.07(b)(iii). Rome
hereby acknowledges that the agreements contained in this
Section 6.07 are an integral part of the transactions
contemplated by this Agreement, and that, without these
agreements, FME would not have entered into this Agreement;
accordingly, if Rome fails to pay to FME the full amount
provided for in Section 6.07(b) promptly following such
payment becoming due pursuant to this Section 6.07(c), Rome
shall (i) pay to FME interest on such unpaid amount at the
prime rate published in the Wall Street Journal Table of Money
Rates on the date such payment was required to be made during
the period from and including the date payment of such amount
was due up to, but excluding, the actual date of payment and
(ii) reimburse FME for any out of pocket expenses
(including the reasonable fees of counsel) incurred by FME in
connection with FME’s enforcement of its rights under this
Section 6.07.



29







 



     
SECTION 6.08. Public Announcements. The Florence Parties,
on the one hand, and Rome, on the other hand, shall consult with
each other (and the Florence Parties shall cause Florence Parent
to consult with Rome) before issuing, and provide each other the
opportunity to review and comment upon, any press release or
other public statements with respect to the Merger and the other
Transactions and shall not issue any such press release or make
any such public statement prior to such consultation, except as
may be required by applicable Law, court process or by
obligations pursuant to any listing requirement of any national
securities exchange on which such party’s securities are
listed.



     
SECTION 6.09. Transfer Taxes. All stock transfer, real
estate transfer, documentary, stamp, recording and other similar
Taxes (including interest, penalties and additions to any such
Taxes) (“Transfer Taxes”) incurred in
connection with the Transactions shall be paid by either FME or
the Surviving Corporation, and Rome shall cooperate with the
Florence Parties in preparing, executing and filing any Tax
Returns with respect to such Transfer Taxes.



     
SECTION 6.10. Rights Agreements. The Rome Board shall
take all action necessary in order to render the Rome Rights
inapplicable to the Merger and the other Transactions.



     
SECTION 6.11. Florence Parties’ Acknowledgement. For
the avoidance of doubt, the Florence Parties acknowledge and
agree that each of them is jointly and severally liable to Rome
for any failure of Florence Parent to take any action or omit to
take any action which the Florence Parties are required to cause
Florence Parent to take or omit to take pursuant to this
Agreement, including without limitation under Section 6.03
of this Agreement, to the same extent Florence Parent would be
liable to Rome if Florence Parent, itself, were a party to this
Agreement and had so breached this Agreement.




ARTICLE VII




Conditions Precedent



     
SECTION 7.01. Conditions to Each Party’s Obligation To
Effect The Merger. The respective obligation of each party
to effect the Merger is subject to the satisfaction or waiver on
or prior to the Closing Date of the following conditions:






		
	 	     
    (a) Stockholder Approval. Rome shall have obtained
    the Rome Stockholder Approval.
	 
	 	     
    (b) Antitrust. The waiting period (and any extension
    thereof) applicable to the Merger under the HSR Act shall have
    been terminated or shall have expired.
	 
	 	     
    (c) No Injunctions or Restraints. No temporary retraining
    order, preliminary or permanent injunction or other order issued
    by any court of competent jurisdiction or other legal restraint
    or prohibition preventing the consummation of the Merger shall
    be in effect; provided, however, that prior to
    asserting this condition, each of the parties shall have used
    its best efforts to prevent the entry of any such injunction or
    other order and to appeal as promptly as possible any such
    judgment that may be entered.



     
SECTION 7.02. Conditions to Obligations of the Florence
Parties. The obligations of the Florence Parties to effect
the Merger are further subject to the satisfaction or waiver on
or prior to the Closing Date of the following conditions:






		
	 	     
    (a) Representations and Warranties. (i) The
    representations and warranties of Rome contained in
    Sections 3.06(d), 3.12 and 3.20 of this Agreement shall be
    true and correct in all material respects as of the date of this
    Agreement and as of the Closing Date as though made on the
    Closing Date, except to the extent such representations and
    warranties expressly relate to an earlier date (in which case
    such representations and warranties shall be true and correct on
    and as of such earlier date) and (ii) the representations
    and warranties of Rome in this Agreement (other than the
    representations and warranties identified in clause
    (i)) shall be true and correct as of the date of this
    Agreement and as of the Closing Date as though made on the
    Closing Date, except to the extent such representations and
    warranties expressly relate to an earlier date (in which case
    such representations and warranties shall be true and correct on
    and as of such earlier date), other than in the case of this
    clause (ii) such failures to be true



30







 


		
	 	
    and correct that, individually or in the aggregate, have not had
    and would not reasonably be expected to have a Rome Material
    Adverse Effect. FME shall have received a certificate signed on
    behalf of Rome by the chief executive officer and the chief
    financial officer of Rome to such effect. For purposes of
    determining the satisfaction of clause (i) or clause
    (ii) of this condition, “knowledge” as used in
    such representations and warranties shall mean knowledge as of
    the Closing and for purposes of determining the satisfaction of
    clause (ii) of this condition, the applicable
    representations and warranties of Rome shall be deemed not
    qualified by any references therein to a Rome Material Adverse
    Effect or to materiality generally.
	 
	 	     
    (b) Performance of Obligations of Rome. Rome shall have
    performed in all material respects all obligations required to
    be performed by it under this Agreement at or prior to the
    Closing Date, and the Florence Parties shall have received a
    certificate signed on behalf of Rome by the chief executive
    officer and the chief financial officer of Rome to such effect.
	 
	 	     
    (c) Absence of Rome Material Adverse Effect. Except as
    disclosed in the Available Rome SEC Documents or in the Rome
    Disclosure Letter, since the date of this Agreement there shall
    not have been any event, change, effect or development that,
    individually or in the aggregate, has had or would reasonably be
    expected to have a Rome Material Adverse Effect.
	 
	 	     
    (d) Conditions to Financing. As of the Closing Date, the
    conditions precedent to the initial funding of the financing
    commitments contained in clauses (i) (to the extent requiring
    the delivery of releases of Liens encumbering the assets of Rome
    and the Rome Subsidiaries) and (vi) (to the extent requiring the
    delivery of financial statements of Rome and the Rome
    Subsidiaries) under the heading “Conditions Precedent to
    All Borrowings” in the Summary of Terms and Conditions
    attached to the Commitment Letter shall have been satisfied or
    waived in writing by the lenders providing such commitments.




     
SECTION 7.03. Conditions to Obligations of Rome. The
obligations of Rome to effect the Merger are further subject to
satisfaction or waiver on or prior to the Closing Date of the
following conditions:






		
	 	     
    (a) Representations and Warranties. (i) The
    representations and warranties of the Florence Parties contained
    in Section 4.04 of this Agreement shall be true and correct
    as of the date of this Agreement and as of the Closing Date as
    though made on the Closing Date, except to the extent such
    representations and warranties expressly relate to an earlier
    date (in which case such representations and warranties shall be
    true and correct on and as of such earlier date) and
    (ii) the representations and warranties of the Florence
    Parties in this Agreement (other than the representations and
    warranties identified in clause (i)) shall be true and
    correct as of the date of this Agreement and as of the Closing
    Date as though made on the Closing Date, except to the extent
    such representations and warranties expressly relate to an
    earlier date (in which case such representations and warranties
    shall be true and correct on and as of such earlier date), other
    than in the case of this clause (ii) such failures to be
    true and correct that, individually or in the aggregate, have
    not had and would not reasonably be expected to have a Florence
    Material Adverse Effect. Rome shall have received a certificate
    signed on behalf of each Florence Party other than Sub by the
    chief executive officer and the chief financial officer of such
    Florence Party to such effect. For purposes of determining the
    satisfaction of clause (i) or clause (ii) of this
    condition, “knowledge” as used in such representations
    and warranties shall mean knowledge as of the Closing and for
    purposes of determining the satisfaction of clause (ii) of
    this condition, the applicable representations and warranties of
    the Florence Parties shall be deemed not qualified by any
    references therein to Florence Material Adverse Effect or to
    materiality generally.
	 
	 	     
    (b) Performance of Obligations of the Florence
    Parties. The Florence Parties shall have performed in all
    material respects all obligations required to be performed by
    them under this Agreement at or prior to the Closing Date, and
    Rome shall have received a certificate signed on behalf of each
    Florence Party by the chief executive officer and the chief
    financial officer of FME to such effect.



31







 




ARTICLE VIII




Termination, Amendment and Waiver



     
SECTION 8.01. Termination. This Agreement may be
terminated at any time prior to the Effective Time, whether
before or after receipt of the Rome Stockholder Approval:






		
	 	     
    (a) by mutual written consent of the Florence Parties and
    Rome;
	 
	 	     
    (b) by either the Florence Parties or Rome:






		
	 	     
    (i) if the Merger is not consummated on or before
    March 31, 2006 (the “Outside Date”);
    provided, however (A) that the right to
    terminate this Agreement pursuant to this
    Section 8.01(b)(i) shall not be available to any party
    whose breach of this Agreement has been the primary reason the
    Merger has not been consummated by such date and (B) that
    neither the Florence Parties nor Rome may terminate pursuant to
    this Clause (b)(i) if on such date all conditions in
    Article VII shall have been satisfied;
	 
	 	     
    (ii) if any Governmental Entity issues an order, decree or
    ruling or takes any other action permanently enjoining,
    restraining or otherwise prohibiting the Merger and such order,
    decree, ruling or other action shall have become final and
    nonappealable; provided, that the party seeking to terminate
    this Agreement shall have used those efforts required hereunder
    to resist, lift or resolve, as applicable, such action; or
	 
	 	     
    (iii) if, upon a vote at a duly held meeting to obtain the
    Rome Stockholder Approval, the Rome Stockholder Approval is not
    obtained; provided, however, that this Agreement
    may not be terminated by the Florence Parties pursuant to this
    clause (iii) if the Florence Parties are in breach of
    Section 6.01(e);






		
	 	     
    (c) by the Florence Parties, if Rome breaches or fails to
    perform in any material respect any of its representations,
    warranties or covenants contained in this Agreement, which
    breach or failure to perform (i) would give rise to the
    failure of a condition set forth in Section 7.02(a) or
    7.02(b), and (ii) cannot be or has not been cured within
    30 days after the giving of written notice to Rome of such
    breach (provided that the Florence Parties are not then in
    material breach of any representation, warranty or covenant
    contained in this Agreement);
	 
	 	     
    (d) by Rome, if the Florence Parties breach or fail to
    perform in any material respect any of their representations,
    warranties or covenants contained in this Agreement, which
    breach or failure to perform (i) would give rise to the
    failure of a condition set forth in Section 7.03(a) or
    7.03(b), and (ii) cannot be or has not been cured within
    30 days after the giving of written notice to the Florence
    Parties of such breach (provided that Rome is not then in
    material breach of any representation, warranty or covenant
    contained in this Agreement);
	 
	 	     
    (e) by the Florence Parties in the event of an Adverse
    Recommendation Change; provided, that the Florence
    Parties may not exercise their termination right pursuant to
    this Section 8.01(e) at any time after the Rome Stockholder
    Approval is obtained;
	 
	 	     
    (f) by Rome if (i) the Rome Board has received a
    Superior Proposal, (ii) Rome has notified the Florence
    Parties in writing that it is prepared to accept such Superior
    Proposal, (iii) at least three business days after receipt
    by the Florence Parties of the notice referred to in clause
    (ii) above, and taking into account any revised proposal
    made by the Florence Parties since receipt of the notice
    referred to in clause (ii) above, such Superior Proposal
    remains a Superior Proposal, (iv) Rome is in compliance
    with Sections 5.02 and 6.07, and (vi) the Rome Board
    concurrently approves, and Rome concurrently enters into, a
    definitive agreement providing for the implementation of such
    Superior Proposal; or
	 
	 	     
    (g) by the Florence Parties if, except as disclosed in the
    Available Rome SEC Documents or in the Rome Disclosure Letter,
    since the date of this Agreement, there shall have been any
    event, change or development that individually or in the
    aggregate has had or would be reasonably be expected to have a
    Rome Material Adverse Effect.



32







 



     
SECTION 8.02. Effect of Termination. In the event of
termination of this Agreement by either Rome or the Florence
Parties as provided in Section 8.01, this Agreement shall
forthwith become void and have no effect, without any liability
or obligation on the part of the Florence Parties, or Rome,
other than Section 3.18, Section 4.06, the last
sentence of Section 6.02, Section 6.07, this
Section 8.02 and Article IX, which provisions shall
survive such termination, and except to the extent that such
termination results from the willful breach by a party of any
representation, warranty or covenant set forth in this Agreement.



     
SECTION 8.03. Amendment. This Agreement may be amended by
the parties at any time before or after receipt of the Rome
Stockholder Approval; provided, however, that (i) after
receipt of the Rome Stockholder Approval, there shall be made no
amendment that by Law requires further approval by the
stockholders of Rome without the further approval of such
stockholders, (ii) no amendment shall be made to this
Agreement after the Effective Time, and (iii) except as
provided above, no amendment of this Agreement by Rome shall
require the approval of the stockholders of Rome. This Agreement
may not be amended except by an instrument in writing signed on
behalf of each of the parties.



     
SECTION 8.04. Extension; Waiver. At any time prior to the
Effective Time, the parties may (a) extend the time for the
performance of any of the obligations or other acts of the other
parties, (b) waive any inaccuracies in the representations
and warranties contained in this Agreement or in any document
delivered pursuant to this Agreement, or (c) subject to the
proviso of Section 8.03, waive compliance with any of the
agreements or conditions contained in this Agreement. Subject to
the proviso in Section 8.03, no extension or waiver by Rome
shall require the approval of the stockholders of Rome Any
agreement on the part of a party to any such extension or waiver
shall be valid only if set forth in an instrument in writing
signed on behalf of such party. The failure of any party to this
Agreement to assert any of its rights under this Agreement or
otherwise shall not constitute a waiver of such rights.




ARTICLE IX




General Provisions



     
SECTION 9.01. Nonsurvival of Representations and
Warranties. None of the representations and warranties in
this Agreement or in any instrument delivered pursuant to this
Agreement shall survive the Effective Time. This
Section 9.01 shall not limit any covenant or agreement of
the parties which by its terms contemplates performance after
the Effective Time.



     
SECTION 9.02. Notices. All notices, requests, claims,
demands and other communications hereunder shall be in writing
and shall be deemed given (a) on the date of delivery, if
delivered personally, (b) one business day after being sent
by overnight courier (providing proof of delivery) to the
parties or (c) on the third business day following the date
of dispatch if delivered by registered or certified mail, return
receipt requested, postage prepaid at the following addresses
(or at such other address for a party as shall be specified by
like notice):






		
	 	     
    (a) if to the Florence Parties, to






		
		
    Fresenius Medical Care AG




Else-Kröner-Strasse 1




61346 Bad Homburg v.d.H.




Telecopy: +49 (6172) 609-2422




Attention: Dr. Rainer Runte




Fresenius Medical Care Holdings, Inc.




Corporate Headquarters




95 Hayden Avenue




Lexington, MA 02420-9192




Telecopy: +1 (781) 402-9004




Attention: Ronald J. Kuerbitz



33







 




with a copy to:




Sonnenschein Nath & Rosenthal LLP




8000 Sears Tower




233 South Wacker Drive




Chicago, Illinois 60606




Telecopy:(312) 876-7934






		
	Attention: 	
    Michael M. Froy, Esq.




Marvin A. Artis, Esq.






		
	 	     
    (b) if to Rome, to






		
		
    Renal Care Group, Inc.




2525 West End Avenue, Suite 600




Nashville, TN 37203




Attention: Gary Brukardt




with a copy to:




Cravath, Swaine & Moore LLP




Worldwide Plaza




825 Eighth Avenue




New York, NY 10019




Telecopy: (212) 474-3700




Attention: Thomas E. Dunn, Esq.



     
SECTION 9.03. Definitions. For purposes of this Agreement:






		
	 	     
    An “affiliate” of any person means another
    person that directly or indirectly, through one or more
    intermediaries, controls, is controlled by, or is under common
    control with, such first person.
	 
	 	     
    A “business day” means any day other than a
    Saturday, Sunday or any other day on which commercial banks in
    the City of New York, New York are authorized or required by Law
    or executive order to close.
	 
	 	     
    “knowledge of Rome” or similar terms used in
    this Agreement mean, as of a particular date of determination,
    the actual knowledge as of such date of the persons listed
    Section 9.03 of the Rome Disclosure Letter.
	 
	 	     
    A “person” means any individual, firm,
    corporation, partnership, company, limited liability company,
    trust, joint venture, association, Governmental Entity,
    unincorporated organization or other entity.
	 
	 	     
    A “subsidiary” of any person means another
    person of which such first person, (i) directly or
    indirectly owns an amount of the voting securities, other voting
    ownership or voting partnership interests having voting power
    under ordinary circumstances sufficient to elect at least 50% of
    its board of directors or other governing body or (ii) owns
    directly or indirectly 50% or more of its equity interests or
    (ii) of which such first person is a general partner.



     
SECTION 9.04. Interpretation. When a reference is made in
this Agreement to a Section, such reference shall be to a
Section of this Agreement unless otherwise indicated. The table
of contents and headings contained in this Agreement are for
reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. Whenever the words
“include”, “includes” or
“including” are used in this Agreement, they shall be
deemed to be followed by the words “without
limitation”. The words “hereof,”
“herein” and “hereunder” and words of
similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement. The term “or” is not exclusive. The
definitions contained in this Agreement are applicable to the
singular as well as the plural forms of such terms. Except where
the context otherwise requires, any agreement or instrument
defined or referred to herein



34







 




or in any agreement or instrument that is referred to herein
means such agreement or instrument as from time to time amended,
modified or supplemented. References to a person are also to its
permitted successors and assigns.



     
SECTION 9.05. Severability. If any term or other
provision of this Agreement is invalid, illegal or incapable of
being enforced by any rule or Law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not
affected in any manner materially adverse to any party. Upon
such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an
acceptable manner to the end that transactions contemplated
hereby are fulfilled to the extent possible.



     
SECTION 9.06. Counterparts. This Agreement may be
executed in one or more counterparts, all of which shall be
considered one and the same agreement and shall become effective
when one or more counterparts have been signed by each of the
parties and delivered to the other parties.



     
SECTION 9.07. Entire Agreement; No Third-Party
Beneficiaries. This Agreement (including the Rome Disclosure
Letter and the Florence Parties Disclosure Letter), taken
together with the Confidentiality Agreement and the letter
agreement dated the date hereof among Florence Parent, FME AG,
FME and Rome, (a) constitute the entire agreement, and
supersede all prior agreements and understandings, both written
and oral, among the parties with respect to the Transactions and
(b) except for Sections 6.04 and 6.06, are not
intended to confer upon any person other than the parties any
rights or remedies. Notwithstanding clause (b) of the
immediately preceding sentence, following the Effective Time the
provisions of Article II shall be enforceable by holders of
Certificates.



     
SECTION 9.08. Governing Law. This Agreement shall be
governed by, and construed in accordance with, the laws of the
State of Delaware, regardless of the laws that might otherwise
govern under applicable principles of conflicts of laws thereof.



     
SECTION 9.09. Assignment. Neither this Agreement nor any
of the rights, interests or obligations under this Agreement
shall be assigned, in whole or in part, by operation of law or
otherwise by any of the parties without the prior written
consent of the other parties. Any purported assignment without
such consent shall be void. Subject to the preceding sentences,
this Agreement will be binding upon, inure to the benefit of,
and be enforceable by, the parties and their respective
successors and assigns.



     
SECTION 9.10. Enforcement. The parties agree that
irreparable damage would occur in the event that any of the
provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. It is
accordingly agreed that the parties shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions of this
Agreement in any federal court located in the State of Delaware
or in the Court of Chancery of the State of Delaware, this being
in addition to any other remedy to which they are entitled at
law or in equity. In addition, each of the parties hereto
(a) consents to submit itself to the personal jurisdiction
of any federal court located in the State of Delaware or the
Court of Chancery of the State of Delaware in the event any
dispute arises out of this Agreement, the Merger or any other
Transaction, (b) agrees that it will not attempt to deny or
defeat such personal jurisdiction by motion or other request for
leave from any such court, (c) agrees that it will not
bring any action relating to this Agreement, the Merger or any
other Transaction in any court other than any federal court
sitting in the State of Delaware or the Court of Chancery of the
State of Delaware and (d) waives any right to trial by jury
with respect to any action related to or arising out of this
Agreement, the Merger or any other Transaction.



     
SECTION 9.11. Construction. The parties hereto have
participated jointly in the negotiation and drafting of this
Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if
drafted jointly by the parties hereto, and no presumption or
burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of this
Agreement.



35







 



     
IN WITNESS WHEREOF, FME AG, FME, Sub and Rome have duly executed
this Agreement, all as of the date first written above.






		
	 	
    FRESENIUS MEDICAL CARE AG,






			
	 	by 	
    /s/ Lawrence A. Rosen



		
	 	
     

	 	
    Name: Lawrence A. Rosen
	 	
    Title: Chief Financial Officer and
	 	
    Member of Management Board






			
	 	by 	
    /s/ Dr. Rainer Runte



		
	 	
     

	 	
    Name: Dr. Rainer Runte
	 	
    Title: Member of Management Board
	 
	 	
    FRESENIUS MEDICAL CARE HOLDINGS, INC.,






			
	 	by 	
    /s/ Rice Powell



		
	 	
     

	 	
    Name: Rice Powell
	 	
    Title: Co-Chief Executive Officer
	 
	 	
    FLORENCE ACQUISITION, INC.,






			
	 	by 	
    /s/ Mats Wahlstrom



		
	 	
     

	 	
    Name: Mats Wahlstrom
	 	
    Title: Co-Chief Executive Officer
	 
	 	
    RENAL CARE GROUP, INC






			
	 	by 	
    /s/ Gary A. Brukardt



		
	 	
     

	 	
    Name: Gary A. Brukardt
	 	
    Title: President & Chief Executive Officer



36