**UNITED STATESSECURITIES AND  EXCHANGE COMMISSION**Washington,D.C. 20549

----

**FORM 10-K**

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

**Commission filenumber:  333-118658**

----

**VWR INTERNATIONAL, INC.**

(Exact name of registrantas specified in its charter)

| Delaware                                                        | **91-1319190**                        |
|-----------------------------------------------------------------|---------------------------------------|
| (State or other jurisdiction of  incorporation or organization) | (I.R.S. Employer  Identification No.) |
| **1310  Goshen Parkway**                                        | ** **                            |
| **PO. Box 2656**                                                | ** **                            |
| **West Chester, PA**                                            | **19380**                             |
| (Address of principal executive offices)                        | (Zip code)                            |

 

Registrant’s telephone number, including areacode:  **(610)431-1700**

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

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

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

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

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

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

Indicate by check markwhether the registrant is a large accelerated filer, an accelerated filer, or anon-accelerated filer. See definition of “accelerated filer and largeaccelerated filer”  in Rule 12b-2of the Exchange Act. (Check one):

Large acceleratedfiler o            Acceleratedfiler o               Non-acceleratedfiler S

Indicate by check mark whether the registrant is ashell company (as defined in Rule 12b-2 of the Act). Yes o No S

As of December 31,2005, there was no established public market for the registrant’s common stock,par value $0.01 per share.  The number ofshares of the registrant’s common stock outstanding at March 24, 2006, was100.

**DOCUMENTS INCORPORATED BY REFERENCENone**

 

----

**TABLE OF CONTENTS**

| ** ** | ** **                                                                                                          | Page   | ** ** |
|------------|---------------------------------------------------------------------------------------------------------------------|--------|------------|
|       | PART I                                                                                                         |   |       |
| ITEM 1.    | BUSINESS                                                                                                            | 1      |       |
| ITEM 1A.   | RISK FACTORS                                                                                                        | 10     |       |
| ITEM 1B.   | UNRESOLVED STAFF  COMMENTS                                                                                          | 16     |       |
| ITEM 2.    | PROPERTIES                                                                                                          | 16     |       |
| ITEM 3.    | LEGAL PROCEEDINGS                                                                                                   | 17     |       |
| ITEM 4.    | SUBMISSION OF MATTERS TO  A VOTE OF SECURITY HOLDERS                                                                | 17     |       |
|       | PART II                                                                                                        |   |       |
| ITEM 5.    | MARKET FOR REGISTRANT’S  COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY  SECURITIES | 18     |       |
| ITEM  6.   | SELECTED FINANCIAL DATA                                                                                             | 18     |       |
| ITEM 7.    | MANAGEMENT’S DISCUSSION  AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS                         | 20     |       |
| ITEM 7A.   | QUANTITATIVE AND  QUALITATIVE DISCLOSURES ABOUT MARKET RISK                                                         | 36     |       |
| ITEM 8.    | FINANCIAL STATEMENTS AND  SUPPLEMENTARY DATA                                                                        | 38     |       |
| ITEM 9.    | CHANGES IN AND  DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE                               | 88     |       |
| ITEM 9A.   | CONTROLS AND PROCEDURES                                                                                             | 88     |       |
| ITEM  9B.  | OTHER INFORMATION                                                                                                   | 88     |       |
|       | PART III                                                                                                       |   |       |
| ITEM 10.   | DIRECTORS AND EXECUTIVE  OFFICERS OF THE REGISTRANT                                                                 | 88     |       |
| ITEM 11.   | EXECUTIVE COMPENSATION                                                                                              | 93     |       |
| ITEM 12.   | SECURITY OWNERSHIP OF  CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS                     | 99     |       |
| ITEM 13.   | CERTAIN RELATIONSHIPS  AND RELATED TRANSACTIONS                                                                     | 101    |       |
| ITEM 14.   | PRINCIPAL ACCOUNTANT  FEES AND SERVICES                                                                             | 104    |       |
|       | PART IV                                                                                                        |   |       |
| ITEM 15.   | EXHIBITS AND FINANCIAL STATEMENT SCHEDULES                                                                          | 105    |       |

 

----

In this Form 10-K,unless the context requires otherwise, references to “we,” “us” and “our” meanVWR International, Inc. and its consolidated subsidiaries, and referencesto the “Company” mean VWR International, Inc.

i

----

**PART I**

**ITEM 1.   BUSINESS**

**Overview**

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

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

On April 7, 2004, wewere acquired from Merck KGaA by CDRV Holdings, Inc. (the “Acquisition”).In connection with the Acquisition, we issued $200.0 million senior notes due2012 and $320.0 million senior subordinated notes due 2014 and entered into asenior secured credit facility (the “Senior Secured Credit Facility”),consisting of a $150.0 million multi-currency revolving credit facility, aswell as a U.S. dollar-denominated term loan and a Euro-denominated term loan.The term loans were initially $415.0 million and €145.0million in principal amount, respectively, which were subsequently reducedthrough prepayments on July 30, 2004 to $379.9 million and €132.7million (approximately $157.2 million as of December 31, 2005, on a U.S.dollar equivalent basis), respectively.

On December 16, 2004,our indirect parent, CDRV Investors, Inc. issued $481.0 million aggregateprincipal amount at maturity ($299.4 million gross proceeds) of 95¤8%senior discount notes due 2015. See “Item 7—Management’s Discussion andAnalysis of Financial Condition and Results of Operations—Debt of CDRVInvestors, Inc.”

During 2005, we expandedour market presence in Ireland, Puerto Rico and Continental Europe throughstrategic acquisitions. See “Item 7—Management’s Discussion and Analysis ofFinancial Condition and Results of Operations” for more information about our acquisitions in 2005. In addition, wehave initiated strategic plans to expand our presence into Eastern Europe andAsia Pacific to develop and expand both sourcing and commercial salesopportunities.

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

1

----

ScienceEducation is comprised of the manufacture and distribution of scientificsupplies and specialized kits principally to primary and secondary schools inNorth America.

**Customers andMarkets**

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

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

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

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

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

**Products andServices**

***Products***

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

2

----

The following tablesummarizes our product lines:

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

 

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

***Services***

We offer services that canbe tailored to meet the diversified needs of customers ranging from single-sitelaboratories to large multinational corporations. These services include thefollowing:

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

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

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

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

·       purchaseand supply of third party products not normally supplied by us.

**DistributionNetwork**

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

3

----

inDarmstadt, Germany, Mollet del Valles, Spain and Milan, Italy. The table belowlists our 16 strategically located distribution centers:

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

 

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

Our regional servicecenters and “Just-in-Time” facilities are adjacent to selected customerlocations and are designed to supply a limited number of products to thosecustomers that require higher-than-standard service levels.

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

**Sales and Marketing**

We market to customersthrough our global sales force, our websites, and our library of catalogs. Wehave a global sales force of over 1,200 employees and have approximately 700employees providing key services, including storeroom management, productmanagement, product procurement, supply chain systems integration, technicalservices and laboratory bench top delivery. Supporting the field salesorganization are specialist groups for e-business integrations, customizedservices, laboratory furniture, safety, environment, microbiology, chromatographyand life science.

The Internet has become anincreasingly important tool for us. During 2005, approximately 27% of our netsales were derived from e-business sales and marketing channels. Our websitesfeature a fully indexed and searchable catalog covering our entire productline, is available in 11 languages and has been custom-designed for 18countries. This electronic catalog includes product descriptions, technicalspecifications and cross-referenced data in a variety of different languagesthrough individual country sites. This website allows customers to enter ordersdirectly and enables us to communicate new product releases, promotions andother news to our customers.

In addition to ourwebsites, we have, as part of our integrated business services capability, agrowing e-business offering that covers order creation, authorization,order status, billing and reporting. These capabilities provide direct datatransfer to customers’ systems and integration with third-party marketplacesused by some of our customers.

4

----

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

**Manufacturers**

We distribute productsfrom more than 2,500 manufacturers. This includes a majority of the majormanufacturers of laboratory chemicals, glassware, plasticware, instruments andother laboratory equipment, protective clothing and laboratory furniture whosell through distributors. In many cases, we believe we are a principaldistributor for these major manufacturers. We are also the exclusivedistributor of Merck KGaA’s chemical products in the laboratory field in manyWestern European countries. Merck KGaA supplied products that accounted forapproximately 13% of our net sales in 2005. This represents approximately 7%and 25% of our North American Lab and European Lab net sales, respectively. Ourdistribution arrangements with Merck KGaA are summarized below.

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

The prices and purchasetargets are agreed upon annually, taking into account market, economic andregulatory developments or reasonably foreseeable extraordinary events that arelikely to have an impact on the industry pricing or sales growth in relevantproducts and marketsegments. If our aggregate purchasesof certain chemical products from Merck KGaA grow at a rate that is less thanthe agreed-upon Europe-wide growth rate (subject to a 50% shortfall as comparedto the agreed-upon growth rate) in each of two consecutive years, and suchaggregate purchases are less than 92.5% of the Europe-wide purchase targets ineach such consecutive year, we will lose our exclusive rights in the laboratoryfield. The purchase targets and purchases are adjusted from time to time to reflectevents outside our control, including customer consolidations, material adverseeffects on the industry, including pricing and demand, and new productintroductions by other manufacturers not matched by Merck KGaA. For the yearended December 31, 2005, we have exceeded the 92.5% purchase targetspecified in the agreement.

The initial term of theagreement is five years, which commenced on April 7, 2004. We may extendthe agreement for a second five-year term if we satisfy certain conditions,including achieving at least 95% of the cumulative Europe-wide sales targetsand maintaining our market share during the initial term. Merck KGaA has theright to terminate the distribution agreement if certain events occur,including, among others, if we acquire a controlling interest in certaincompetitive manufacturers, or certain competitive manufacturers acquire acontrolling interest in us. The Company has no acquisition plans that wouldconflict with the terms of the agreement.

5

----

***Other Merck KGaA Distribution Agreements.  ***Inconnection with the Acquisition, we entered into a five-year distributionagreement with Merck KGaA to distribute certain chemical products in NorthAmerica on substantially the same terms as those governing their distributionprior to the Acquisition. We do not have exclusive distribution rights in NorthAmerica, but we are Merck KGaA’s preferred distributor of its chemicalproducts. As Merck KGaA’s preferred distributor, we are entitled to, amongother things, the lowest transfer prices from Merck KGaA for so long as wemaintain our market share in the laboratory field. We have the right to extendthe agreement for a second five-year term unless Merck KGaA submits atermination notice at least 12 months prior to the expiration of the initialterm. Merck KGaA may terminate the distribution agreement if certain eventsoccur, including, among others, if we acquire a controlling interest in certaincompetitive manufacturers. The Company has no acquisition plans that wouldconflict with the terms of this agreement.

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

**Manufacturing**

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

**Transitionand Other Services**

We and Merck KGaA havehistorically performed corporate services for each other, including certainfinancial, administrative and information technology functions. In order tomaintain continuous and efficient operations, effective as of April 7,2004, we entered into a transition services agreement and an informationservices master agreement with Merck KGaA to maintain these relationshipsfollowing the Acquisition until such time as these services can be obtainedinternally or from other sources. The term of the transition services agreementis three years, and it will expire on April 6, 2007, although therecipient of the services has in most cases the right to terminate individualservices upon notice. We and Merck KGaA will also continue to provide eachother with certain environmental and other regulatory compliance services for atransition period following the Acquisition. During 2005, the Company and MerckKGaA have made substantial progress to reduce these interdependencies.Currently, the level of interdependency is minimal with respect to financialand administrative functions.

Following the completionof the Acquisition, we and Merck KGaA have also continued to provide certaininformation technology services to each other consistent with the arrangementsin place prior to the Acquisition, including Merck KGaA’s operation and supportof the main enterprise resource planning and business warehouse software anddatabases for our European companies. The information services master agreementwill continue for an initial five-year period from the closing date of theAcquisition and 

6

----

willexpire on April 6, 2009, although individual services may be terminatedduring the term following a notice period. The Company continues to depend onMerck KGaA to host certain enterprise systems, fulfill hardware supportrequirements and conduct related information technology functions, such as dataarchival.

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

The transition servicesagreement does not apply to certain arrangements involving Merck KGaA and usthat were in place prior to the Acquisition, which continue on for theirexisting terms. For example, Merck KGaA continues to provide logistics servicesto certain of our subsidiaries until the end of 2007. Unless earlier terminatedfollowing a notice period, such logistics service arrangements will beautomatically renewed for an additional three years.

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

**Trademarks andTrade Names**

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

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

Our business is notdependent to a material degree on patents, copyrights or trade secrets althoughwe consider our catalogs, websites and proprietary software integral to ouroperations. Although we believe we have adequate policies and procedures inplace to protect our intellectual property, we have not sought patentprotection for our processes nor have we registered the copyrights in any ofour catalogues, websites or proprietary software. Other than licenses tocommercially available third-party software, we have no licenses tointellectual property that are significant to the business.

7

----

**Competition**

We operate in a highlycompetitive environment. We compete in the scientific supplies distributionbusiness primarily with two major distributors, Fisher Scientific InternationalInc. and Sigma-Aldrich Corporation, and with many smaller regional, local andspecialty distributors, as well as with manufacturers selling directly to theircustomers. Competitive factors include price, service and delivery, breadth ofproduct line, customer support, e-business capabilities and the ability to meetthe special requirements of customers. We believe we compete effectively on allof these factors. We also believe that our competitive position depends not ona single factor, but upon a combination of traditional distribution services,customized services and technological innovation, practiced on a global basis.

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

**GovernmentRegulation**

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

**Employees**

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

**Environmental,Health and Safety Matters**

We are subject to a broadrange of foreign, federal, state and local environmental, health and safety lawsand regulations, including those pertaining to air emissions, water discharges,the handling, disposal and transport of solid and hazardous materials andwastes, the investigation and remediation of contamination and otherwiserelating to health and safety and the protection of the environment and naturalresources. As our global operations involve and have involved the handling,transport and distribution of materials that are or could be classified astoxic or hazardous, there is some risk of 

8

----

contaminationand environmental damage inherent in our operations and the products we handle,transport and distribute. Our environmental, health and safety liabilities andobligations may result in significant capital expenditures and other costs,which could negatively impact our business, financial condition and results ofoperations. We may be fined or penalized by regulators for failing to complywith environmental, health and safety laws and regulations. In addition,contamination resulting from our current or past operations may triggerinvestigation or remediation obligations, which may have a material impact onour business, financial condition and results of operations.

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

**AvailableInformation**

We file annual andquarterly reports and other information with the SEC. You may read and copy anydocuments we file at the SEC’s public reference room at 450 Fifth Street, N.W.,Washington, D.C. 20549. Please call the SEC at 1-800-SEC-0330for further information on the public reference room. Our SEC filings are alsoavailable to the public free of charge at the SEC’s website at*www.sec.gov.*

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

**CorporateInformation**

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

9

----

**ITEM 1A.   RISKFACTORS**

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

**RiskFactors Related to Our Capital Structure**

**We have substantial existing debt and may incursubstantial additional debt, which could adversely affect our financial healthand our ability to obtain financing in the future, react to changes in ourbusiness and make payments on our debt.**

As of December 31,2005, we had an aggregate principal amount of debt outstanding of $1,063.8million.

The agreements governingour debt permit us to incur or guarantee additional indebtedness, includingindebtedness under the Senior Secured Credit Facility, subject to specifiedlimitations. We have additional borrowing capacity on a revolving credit basisunder the Senior Secured Credit Facility of $138.4 million as of December 31,2005, which these limitations permit us to incur. We may incur substantialadditional debt in the future.

Oursubstantial debt could have important consequences to us. Because of oursubstantial debt:

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

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

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

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

·       our flexibility to adjustto changing market conditions and ability to withstand competitive pressurescould be limited, and we may be more vulnerable to a downturn in generaleconomic conditions or our business or be unable to carry out capital spendingthat is necessary or important to our growth strategy and our efforts toimprove operating margins.

**Our ability to generate the significant amount of cashneeded to pay interest and principal on our debt when due and our ability torefinance all or a portion of our indebtedness or obtain additional financing,may depend on many factors beyond our control.**

Ourability to make scheduled payments or to refinance our obligations with respectto our debt depends on our financial and operating performance, which, in turn,is subject to prevailing economic and competitive conditions and to thefollowing financial and business factors, some of which may be beyond ourcontrol:

·       operatingdifficulties;

·       increasedoperating costs;

·       decreaseddemand for our products;

·       marketcyclically;

·       productprices;

·       theresponse of competitors;

10

----

·       regulatorydevelopments;

·       failureto successfully integrate acquisitions; and

·       delaysin implementing strategic projects.

If our cash flow andcapital resources are insufficient to fund our debt service obligations, we maybe forced to further reduce or delay capital expenditures, sell assets or seekto obtain additional equity capital, or restructure our debt. In the future,our cash flow and capital resources may not be sufficient for payments ofinterest on and principal of our debt, and such alternative measures may not besuccessful and may not permit us to meet our scheduled debt service obligations.We also cannot assure you that we will be able to refinance any of ourindebtedness or obtain additional financing, particularly because of our highlevels of debt and the debt incurrence restrictions imposed by the agreementsgoverning our debt, as well as prevailing market conditions. In the absence ofsuch operating results and resources, we could face substantial liquidityproblems and might be required to dispose of material assets or operations tomeet our debt service and other obligations. If required, we cannot be sure asto the timing of such sales or the proceeds that we could realize therefrom.

**RiskFactors Related to Our Business**

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

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

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

Our customers are engagedin research, development and production in the pharmaceutical, biotechnology,industrial, education and other markets. The amount of customer spending onresearch, development and production has a large impact on our sales andprofitability. Our customers determine the amounts that they will spend on thebasis of, among other things, available resources and their need to develop newproducts, which, in turn, is dependent upon a number of factors, includingtheir competitors’ research, development and production initiatives. In addition,consolidation in the industries in which our customers operate may have animpact on such spending as customers integrate acquired operations, includingR&D departments and their budgets. Our customers finance their R&Dspending from private and public sources. Government funding of scientificresearch and education has varied for several reasons, including generaleconomic conditions, growth in population, political priorities, changes in thenumber of students and other demographic changes. A reduction in spending byour customers could have a material adverse effect on our business, financialcondition and results of operations.

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

We compete globally withtwo major distributors, Fisher Scientific International Inc. and Sigma-AldrichCorporation, as well as many smaller regional, local and specialtydistributors, and with manufacturers selling directly to their customers. Thebases upon which we compete include price, service 

11

----

anddelivery, breadth of customer support, e-business capabilities and theability to meet the special requirements of customers.

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

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

We currently offer over 1,200,000products from more than 2,500 manufacturers. We are dependent on thesemanufacturers for our supply of products.

Our ability to sustain ourgross margins has been, and will continue to be, dependent in part upon ourability to obtain favorable terms from our manufacturers. These terms may besubject to changes from time to time by manufacturers and such changes couldadversely affect our gross margins over time.

The loss of one or more ofour large manufacturers, a material reduction in their supply of products tous, or material changes in the terms we obtain from them, could have a materialadverse effect on our business, financial condition and results of operations.

Some of our competitorsare increasing their manufacturing operations both internally and throughacquisitions of manufacturers, including manufacturers that supply products tous. To date, we have not experienced an adverse impact on our ability tocontinue to source products from manufacturers that have been verticallyintegrated, although there is no assurance that we will not experience such animpact in the future.

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

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

12

----

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

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

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

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

Our operations are subjectto applicable antitrust and competition laws in the countries in which weconduct our business, in particular the U.S. and the European Union. These lawsprohibit, among other things, anticompetitive agreements and practices. If anyof our commercial agreements are found to violate or infringe such laws, we maybe subject to civil and other penalties and/or third party claims for damages.Further, agreements that infringe these laws may be void and unenforceable, inwhole or in part, or require modification in order to be lawful andenforceable. If we are unable to enforce any of our commercial agreements,whether at all or in material part, our business could be adversely affected.For further information see “Item 3—Legal Proceedings.”

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

We are subject to a broadrange of foreign, federal, state and local environmental, health and safetylaws and regulations, including those pertaining to air emissions, waterdischarges, the handling, disposal and transport of solid and hazardousmaterials and wastes, the investigation and remediation of contamination andotherwise relating to health and safety and the protection of the environmentand natural resources. As our global operations involve and have involved thehandling, transport and distribution of materials that are or could beclassified as toxic or hazardous, there is some risk of contamination andenvironmental damage inherent in our operations and the products we handle,transport and distribute. Our environmental, health and safety liabilities andobligations may result in significant capital expenditures and other costs,which could negatively impact our business, financial condition and results ofoperations. We may be fined or penalized by regulators for failing to complywith environmental, health and safety laws and regulations. In addition,contamination resulting from our current or past operations may triggerinvestigation or remediation obligations, which may have a material adverseeffect on our business, financial condition and results of operations.

Based on currentinformation, we believe that any costs we may incur relating to environmentalmatters will not be material. We cannot be certain, however, thatidentification of presently unidentified 

13

----

environmentalconditions, more vigorous enforcement by regulatory authorities or otherunanticipated events will not arise in the future and give rise to additionalenvironmental liabilities, compliance costs or penalties which could have amaterial adverse effect on our business, financial condition or results ofoperations. In addition, environmental laws and regulations are constantlyevolving and it is not possible to predict accurately the effect they may havein future periods.

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

Our business involves arisk of product liability and other claims in the ordinary course of business.We maintain insurance policies, including product liability insurance, and inmany cases we have indemnification rights against such claims from themanufacturers of the products we distribute. We cannot assure you that ourinsurance coverage or the manufacturers’ indemnity will be available in allpending or any future cases brought against us. In addition, our ability torecover under insurance or indemnification arrangements is subject to thefinancial viability of the insurers and manufacturers. Insurance for someliabilities, including asbestos, is not available. Accordingly, we could besubject to uninsured and unidentified future liabilities, and an unfavorableresult in a case for which adequate insurance or indemnification is notavailable could result in a material adverse effect on our business, financialcondition and results of operations.

From time to time, we arenamed as a defendant in cases as a result of our distribution of scientificsupplies, including litigation resulting from the distribution of productscontaining asbestos by us and certain of our predecessors. While the impact ofthis litigation on us has typically been immaterial, there can be no assurancethat the impact of the pending and any future claims will not be material toour business, financial condition and results of operations in the future. Forfurther information, see “Item 3—Legal Proceedings.”

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

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

**Ourinternational operations pose currency risks.**

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

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

Wederive approximately 41% of our net sales from our operations outside theUnited States and the Company plans to expand sourcing and commercialoperations into Asia and Eastern Europe. Accordingly, we face certain risks,including:

·       restrictionson foreign ownership of subsidiaries;

·       tariffsand other trade barriers;

·       politicalrisks;

14

----

·       differinglaws or administrative practices; and

·       potentiallyadverse tax consequences of operating in multiple jurisdictions.

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

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

Our success depends, inpart, on the secure and uninterrupted performance of our information technologysystems. Our computer systems as well as those of our service providers arevulnerable to damage from a variety of sources, including telecommunicationsfailures, malicious human acts and natural disasters. Moreover, despite networksecurity measures, some of our servers and those of our service providers arepotentially vulnerable to physical or electronic break-ins, computer virusesand similar disruptive problems. While we have taken appropriate steps toreinforce the security of our websites, there can be no guarantee thatunauthorized intrusion will not occur. Failure to maintain a secure web-basedprocurement system could have a material adverse effect on our business,financial condition and results of operations.

Despite the precautions wehave taken, unanticipated problems may nevertheless cause failures in ourinformation technology systems. Sustained or repeated system failures thatinterrupt our ability to process orders and deliver products in a timely mannercould have a material adverse effect on our business, financial condition andresults of operations.

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

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

We maintain operations in18 countries. We also export products from our distribution facilities in NorthAmerica and Europe to markets in Central America, South America, BritishCommonwealth countries, North Africa, the Middle East and the Pacific Rim. Wehave not sought to register our material trademarks and service marks in all ofthese countries and may be blocked from doing so by others who have alreadyregistered identical or similar marks for similar goods or services. Inaddition, if we do business in countries where other companies may haveregistered identical or similar trademarks or service marks, we run the risk ofbeing sued for infringement.

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

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

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

15

----

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

We maycontinue to engage in selective acquisitions from time to time. Any futureacquisitions could result in a variety of other risks:

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

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

·       wemay assume substantial actual or contingent liabilities;

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

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

**ITEM1B.**       UNRESOLVED STAFF COMMENTS

None.

**ITEM 2.**                PROPERTIES

We own and lease officeand warehouse space in North America and Europe. We maintain our corporateheadquarters in West Chester, Pennsylvania for executive, financial,information systems, marketing and other administrative activities. OurEuropean executive, financial, information systems, marketing and otheradministrative activities are in Darmstadt, Germany and Haasrode, Belgium. Asof December 31, 2005, the following table sets forth information withrespect to our significant distribution, manufacturing and other officefacilities:

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

 

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

16

----

**ITEM 3.**                LEGALPROCEEDINGS

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

During 2005, the German Federal Cartel Officeinitiated an investigation with regard to our European Distribution Agreementwith Merck KGaA. The purpose of the investigation is to determine whether thisagreement violates or otherwise infringes the general prohibition ofanti-competitive agreements under either German or EU rules. The Company hassubmitted information to the German Federal Cartel Office and is awaitingfeedback in connection with this matter. At the current time we cannot assessthe likely outcome of the investigation or potential economic impact associatedwith an adverse ruling. In connection with the Acquisition, we recordedintangible assets of approximately €24.8 million (or$29.4 million on a U.S. dollar equivalent basis as of December 31, 2005) related to ourEuropean Distribution Agreement with Merck KGaA. As of December 31, 2005,the unamortized net book value of these intangible assets is approximately €20.4million (or $24.2 million on a U.S. dollar equivalent basis).

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

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

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

None.

17

----

**PART II**

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

There is no establishedpublic trading market for our common stock. We are a wholly-owned indirectsubsidiary of CDRV Investors, Inc. We did not pay any dividends on ourcommon stock during 2005, 2004 or 2003. Our debt instruments restrict ourability to pay dividends. See “Item 7—Management’s Discussion and Analysis ofFinancial Condition and Results of Operations—Indebtedness Following theAcquisition.” Since April 7, 2004, there have been no purchases of equitysecurities.

**ITEM 6.**                SELECTEDFINANCIAL DATA

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

| ** **                                                                                   | ** ** | **Successor**         | ** ** | ** **             | ** ** | **Predecessor** | ** ** |
|----------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|-----------------|------------|
| ** **                                                                                   | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | ** **      | ** ** | **January 1–** | ** ** | ** ** | ** ** |
| ** **                                                                                   | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | ** **      | ** ** | **April 6,** | ** ** | **Years Ended December 31,** | ** ** |
| ** **                                                                                   | ** ** | **2005**              | ** ** | **2004**               | ** ** | ** **      | ** ** | **2004** | ** ** | **2003** | ** ** | **2002** | ** ** | **2001** | ** ** |
| ** **                                                                                   | ** ** | **(Consolidated)**    | ** ** | **(Consolidated)**     | ** ** | ** **      | ** ** | **(Consolidated)** | ** ** | **(Consolidated)** | ** ** | **(Combined)** | ** ** | **(Combined)** | ** ** |
| ** **                                                                                   | ** ** | ** **            | ** ** | ** **             | ** ** | ** **      | ** ** | **(Dollars in millions)** | ** ** | ** ** | ** ** | ** ** | ** ** |
| **Income Statement Data:**                                                                   |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net Sales                                                                                    |       |                  | $          | 3,138.2                |       |            |       | $ | 2,212.2 |   |   |   |   |   | $ | 793.2 |   |   |   | $ | 2,794.2 |   |   |   | $ | 2,624.1 |   |   |   | $ | 2,522.4 |   |   |
| Cost of goods sold                                                                           |       |                  | 2,334.5    |                   |       |            | 1,652.7    |   |   |   |   |   | 588.0 |   |   |   | 2,078.1 |   |   |   | 1,950.1 |   |   |   | 1,886.1 |   |   |
| Gross profit                                                                                 |       |                  | 803.7      |                   |       |            | 559.5      |   |   |   |   |   | 205.2 |   |   |   | 716.1 |   |   |   | 674.0 |   |   |   | 636.3 |   |   |
| Selling, general  and administrative expenses(3)                                             |       |                  | 639.9      |                   |       |            | 455.4      |   |   |   |   |   | 163.7 |   |   |   | 583.4 |   |   |   | 560.0 |   |   |   | 573.7 |   |   |
| Restructuring and  other charges(2)                                                          |       |                  | 20.6       |                   |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |   | — |   |   |   | 11.5 |   |   |
| Operating income                                                                             |       |                  | 143.2      |                   |       |            | 104.1      |   |   |   |   |   | 41.5 |   |   |   | 132.7 |   |   |   | 114.0 |   |   |   | 51.1 |   |   |
| Interest expense,  net                                                                       |       |                  | 74.3       |                   |       |            | 50.7       |   |   |   |   |   | 5.6 |   |   |   | 24.4 |   |   |   | 39.4 |   |   |   | 74.1 |   |   |
| Other (income)  expense, net                                                                 |       |                  | (3.9       | )                      |       |            | (2.0       | ) |   |   |   |   | 0.1 |   |   |   | (3.0 | ) |   |   | 0.6 |   |   |   | 2.4 |   |   |
| Income (loss) before income taxes and cumulative  effect of changes in accounting principles |       |                  | 72.8       |                   |       |            | 55.4       |   |   |   |   |   | 35.8 |   |   |   | 111.3 |   |   |   | 74.0 |   |   |   | (25.4 | ) |   |
| Income tax  provision                                                                        |       |                  | 31.0       |                   |       |            | 23.5       |   |   |   |   |   | 15.1 |   |   |   | 46.2 |   |   |   | 29.7 |   |   |   | 7.0 |   |   |
| Income (loss)  before cumulative effect of changes in accounting principles                  |       |                  | 41.8       |                   |       |            | 31.9       |   |   |   |   |   | 20.7 |   |   |   | 65.1 |   |   |   | 44.3 |   |   |   | (32.4 | ) |   |
| Cumulative effect  of changes in accounting principles(1)(3)                                 |       |                  | (0.5       | )                      |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |   | (43.8 | ) |   |   | — |   |   |
| Net income (loss)                                                                            |       |                  | $          | 41.3                   |       |            |       | $ | 31.9 |   |   |   |   |   | $ | 20.7 |   |   |   | $ | 65.1 |   |   |   | $ | 0.5 |   |   |   | $ | (32.4 | ) |   |
| **Other Financial Data:**                                                                    |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and  amortization(3)                                                            |       |                  | $          | 33.9                   |       |            |       | $ | 25.8 |   |   |   |   |   | $ | 8.9 |   |   |   | $ | 32.9 |   |   |   | $ | 32.6 |   |   |   | $ | 82.6 |   |   |
| Capital expenditures                                                                         |       |                  | 18.4       |                   |       |            | 13.1       |   |   |   |   |   | 3.3 |   |   |   | 16.6 |   |   |   | 41.0 |   |   |   | 28.2 |   |   |
| Gross profit as a  percentage of net sales                                                   |       |                  | 25.6       | %                      |       |            | 25.3       | % |   |   |   |   | 25.9 | % |   |   | 25.6 | % |   |   | 25.7 | % |   |   | 25.2 | % |   |
| Ratio of earnings  to fixed charges(4)                                                       |       |                  | 1.8x       |                   |       |            | 1.9x       |   |   |   |   |   | 5.1x |   |   |   | 4.1x |   |   |   | 2.4x |   |   |   | — |   |   |

 

18

----

 

| ** **                 | ** ** | **Successor**                       | ** ** | ** **         | ** ** | **Predecessor**       | ** ** |
|----------------------------|------------|-------------------------------------|------------|--------------------|------------|-----------------------|------------|
| ** **                 | ** ** | **December 31,**               | ** ** | ** **         | ** ** | **December 31,** | ** ** |
| ** **                 | ** ** | **2005**                            | ** ** | **2004**           | ** ** | ** **            | ** ** | **2003** | ** ** | **2002** | ** ** | **2001** | ** ** |
| ** **                 | ** ** | **(Consolidated)**                  | ** ** | **(Consolidated)** | ** ** | ** **            | ** ** | **(Consolidated)** | ** ** | **(Combined)** | ** ** | **(Combined)** | ** ** |
| ** **                 | ** ** | **(Dollars in millions)** | ** ** |
| **Balance Sheet Data:**    |       |                                |       |               |       |                  |       |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Total assets               |       |                                | $          | 2,542.4            |       |                  |       | $ | 2,550.9 |   |   |   |   |   | $ | 1,767.9 |   |   |   | $ | 1,705.2 |   |   |   | $ | 1,783.9 |   |   |
| Total debt                 |       |                                | 1,063.8    |               |       |                  | 1,099.2    |   |   |   |   |   | 1,026.0 |   |   |   | 1,100.6 |   |   |   | 1,239.5 |   |   |
| Stockholders’  equity |       |                                | 641.7      |               |       |                  | 637.3      |   |   |   |   |   | 265.4 |   |   |   | 176.9 |   |   |   | 170.2 |   |   |
|                            |            |                                     |            |                    |            |                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

----

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

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

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

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

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

19

----

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

**Overview**

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

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

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

The principal tenets of our strategy are outlinedbelow.

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

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

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

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

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

20

----

In addition, we initiatedcost reduction programs in response to relatively static market conditions andimplemented reductions in force and other cost containment measures primarilyduring the later part of 2005 that did not qualify as acquisition costs. Inconnection with these actions, we recorded restructuring charges related toseverance and facility exit costs totaling approximately $20.6 million.

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

**Basisof Financial Statement Presentation**

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

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

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

21

----

tooperate as a separate company, costs of periodic reporting to the SEC, as wellas the costs related to a global tax and treasury staff and compliance with theSarbanes-Oxley Act of 2002. The historical financial information also does notreflect the incremental costs associated with changes in our capital structureand operations.

**Effects of the Acquisition**

The Acquisition has been accounted for using thepurchase method of accounting. As such, our assets and liabilities wereadjusted, as of the date of Acquisition, to their respective fair values. Thisresulted in the recognition of significant identified intangible assetsrelating to customer relationships, trademarks and tradenames, an increase inpension and post-retirement liabilities for existing plans, the recognition ofother fair value adjustments and the impact of the new debt and equitystructure.

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

**Constant Currency Analysis**

We maintain operations in North America and in 15European countries. Approximately 41% of our net sales for the year ended December 31,2005 originated in currencies other than the U.S. dollar, principally the Euro,the British pound sterling and the Canadian dollar. As a result, changes in ourrevenues and operating profits include the impact of changes in foreigncurrency exchange rates. We provide “constant currency” calculations in thisAnnual Report on Form 10-K to remove the impact of the fluctuationin foreign exchange rates.

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

**Business Segments**

We report our financialresults on the basis of the following three business segments: North Americanlaboratory distribution, or North American Lab, European laboratory distribution,or European Lab, and Science Education. Both the North American Lab andEuropean Lab segments are comprised of the distribution of scientific suppliesto customers in the pharmaceutical, biotechnology, chemical, technology, foodprocessing, governmental agencies, colleges and universities and environmentalorganizations. Science Education is comprised of the manufacture anddistribution of scientific supplies and specialized kits principally to primaryand secondary schools in North America.

**Seasonality**

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

22

----

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

**Results of Operations**

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

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

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

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

On April 1, 2005, the Company acquired AGBScientific Ltd. (“AGB”) for initial cash consideration of approximately $23.8million. AGB distributes scientific supplies and is headquartered in Dublin,Ireland. The results of AGB have been included in the European Lab segment fromthe date of acquisition. On April 1, 2005, the Company acquired AdvancedInstruments Sales & Service, Inc. (“AI”) for cash considerationof approximately $16.8 million and CDRV stock of approximately $0.5 million. AIperforms services and distributes scientific supplies to the Puerto Ricanmarket and is headquartered in San Juan, Puerto Rico. The results of AI havebeen included in the North American Lab segment from the date of acquisition. OnJuly 1, 2005, the Company acquired Technical Service Lab B.V. (“TSL”) forcash consideration of approximately $3.1 million. TSL performs technicalservices on laboratory equipment in the Netherlands, Germany, Belgium andFrance. The results of TSL have been included in the European Lab segment fromthe date of acquisition.

AGB had net sales of $26.6million, gross profit of $7.8 million and operating income of $1.3 millionincluded in our year ended December 31, 2005 results. AI had net sales of$13.5 million, gross profit of $6.2 million and operating income of $1.1million included in our year ended December 31, 2005 results. TSL had netsales of $1.0 million, gross profit of $0.6 million and operating income of$0.2 million included in our year ended December 31, 2005 results. Hadthese acquisitions occurred at the beginning of 2004, the pro-formaconsolidated statements of operations would not have been materially differentfrom the amounts reported.

23

----

***Net Sales***

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

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

 

Net sales for 2005 increased $132.8 million or 4.4%over 2004. Our current year acquisitions and the effects of foreign currencyaccounted for $41.1 million and $9.5 million of the increase, respectively.Excluding these effects, net sales increased 2.7% from 2004. All of oursegments experienced net sales growth in 2005. Net sales for 2004 increased$211.2 million or 7.6% from 2003. Excluding the effects of foreign currency of$108.2 million for 2004, net sales increased by 3.7% from 2003. The vastmajority of the 2004 growth expressed in local currencies was from the NorthAmerican Lab segment while net sales in the European Lab segment were flat.

Net sales in the North American Lab segment for 2005increased $65.2 million or 3.5%. Our current year acquisition of AI and theeffects of foreign currency accounted for $13.5 million and $13.4 million ofthe increase, respectively. Excluding these effects, net sales increased 2.1%from 2004. During 2005, our net sales in the bio-pharmaceutical market wererelatively flat and our net sales in the education and industrial marketsachieved low single-digit growth. Net sales in the North American Lab segmentfor 2004 increased $102.9 million or 5.9%. Foreign currency changes accountedfor $11.8 million of the increase for 2004 and our organic growth wasrelatively broad based across most product groups, especially chemicals andequipment/instruments.

Net sales in the European Lab segment for 2005increased $54.5 million or 5.3%. Our current year acquisitions of AGB and TSLfavorably impacted net sales by $27.6 million and the effects of foreigncurrency unfavorably impacted net sales by $3.9 million. Excluding theseeffects, net sales increased 3.0% from 2004. Our European Lab segment operatesin fifteen countries and its results are heavily influenced by the larger countriesin which we operate such as Germany, the UK, France, and Belgium. These largemarkets and the majority of our smaller operations in other countriesexperienced growth during 2005. This growth was primarily driven by ourbio-pharmaceutical and industrial markets and was partially offset by a declinein our resellers market. Net sales in the European Lab segment for 2004increased $102.7 million or 11.0%. The increase was due to the impact offavorable currency exchange rates, as sluggish economic conditions throughoutEurope caused net sales expressed in local currencies to be essentially flat.Foreign currency changes accounted for $96.4 million of the 2004 increase.

Net sales in the ScienceEducation segment for 2005 increased $13.1 million or 9.9%. This increase wasprimarily driven by increased sales in both our education and publishersmarkets. In addition, during 2005 there were less budget constraints by certainstate and local governments, which limited the amount of funds available forthe purchase of scientific supplies for school laboratories, as compared to2004. Net sales in the Science Education segment for 2004 increased $5.6million or 4.4%. The increase for 2004 was mainly attributable to a strongselling season especially during the third quarter. The positive sales growthduring the third quarter of 2004 helped offset the sales decline this segmenthad experienced during the first half of 2004 as a result of the budgetconstraints discussed above.

24

----

***Gross Profit***

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

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

 

Gross profit for 2005increased $39.0 million or 5.1%. Our current year acquisitions and the effectsof foreign currency accounted for $14.6 million and $2.0 million of theincrease, respectively. Excluding these effects, gross profit increased 2.9%from 2004. During 2005, our North American Lab margins improved slightly whileboth the European Lab and Science Education margins declined. The European Labgross margin percentages decreased slightly as a result of product mix andpricing pressures. Science Education gross margin percentages decreased as aresult of product mix, pricing pressures and a shift in customer buyingpatterns to open bid or auction purchasing.

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

***Selling, Generaland Administrative Expenses***

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

| ** **                                    | ** ** | **Years Ended December 31,** |
|-----------------------------------------------|------------|---------------------------------------------|
| ** **                                    | ** ** | **2005**                                    | ** ** | **2004** | ** ** | **2003** | ** ** |
| Selling, general  and administrative expenses |       | $                                           | 639.9 |   | $ | 619.1 |   | $ | 583.4 |   |
| Percentage of net sales                       |       | 20.4                                        | % | 20.6 | % | 20.9 | % |
|                                               |            |                                             |  |  |  |  |  |  |  |  |

 

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

SG&A expenses for 2005 increased $20.8 million or3.4%. Our current year acquisitions and the effects of foreign currencyaccounted for $12.0 million and $0.7 million of the increase, respectively.Excluding these effects, SG&A expenses increased $8.1 million or 1.3% from2004. This increase primarily reflects our aforementioned investments inpersonnel, inflation, and costs incurred related to our compliance with theSarbanes-Oxley Act. Partially offsetting the increase are savings from ourrestructuring programs and lowerprovisions for bonus of approximately $7.1 million in North America, due toshortfalls from the approved management incentive plan earnings targets.

25

----

SG&A expenses for 2004increased $35.7 million or 6.1%. Excluding the effects of foreign exchangetotaling $27.7 million for 2004, SG&A increased by 1.4% from 2003. Staffingreductions resulted in modest declines in SG&A expenses during the firsthalf of 2004. These declines were subsequently offset during the third quarterof 2004 by increases in costs associated with our investment in sales and otherstrategic and corporate personnel.

***Restructuring Charges***

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

***Operating Income***

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

| ** **         | ** ** | **Years Ended December 31,** | ** ** | **Percent of Net Sales** | ** ** |
|--------------------|------------|---------------------------------------------|------------|-----------------------------------------|------------|
| ** **         | ** ** | **2005**                                    | ** ** | **2004**                                | ** ** | **2003** | ** ** | **2005** | ** ** | **2004** | ** ** | **2003** | ** ** |
| Operating Income   |       |                                        |       |                                    |       |   |   |   |   |   |   |   |   |   |   |
| North American Lab |       | $                                           | 91.1       |                                    | $          | 93.8 |   | $ | 82.8 |   |   | 4.8 | % |   | 5.1 | % | 4.8 | % |
| European Lab       |       | 38.1                                        |       | 37.2                                    |       | 35.9 |   |   | 3.5 | % |   | 3.6 | % | 3.8 | % |
| Science Education  |       | 14.0                                        |       | 14.6                                    |       | 14.0 |   |   | 9.6 | % |   | 11.0 | % | 11.0 | % |
| Total              |       | $                                           | 143.2      |                                    | $          | 145.6 |   | $ | 132.7 |   |   | 4.6 | % |   | 4.8 | % | 4.7 | % |

 

Operating income for 2005 decreased $2.4 million or1.6% from 2004. Our current year acquisitions and the effects of foreigncurrency favorably impacted operating income in 2005 by $2.6 million and $1.3million, respectively. The restructuring programs discussed above decreasedoperating income by $20.6 million in 2005. Excluding these effects, operatingincome increased $14.3 million or 9.8% over 2004. This increase was the resultof improvement in gross profit of $22.4 million, primarily attributable tosales volume, partially offset by an SG&A increase of $8.1 million.Operating income for 2004 increased $12.9 million or 9.7%. Excluding theeffects of strengthening foreign currencies, operating income would haveincreased by 6.0% in 2004. Operating income expressed as a percentage of netsales was 4.8% for 2004 compared to 4.7% for 2003. The year-over-yearimprovement was primarily due to sales and gross profit growth rates exceedingthe SG&A expense growth rate in the North American Lab segment.

Operating income in the North American Lab segment for2005 decreased $2.7 million or 2.9% from 2004. Our current year acquisition ofAI and the effects of foreign currency favorably impacted operating income in2005 by $1.1 million and $1.4 million, respectively. The restructuring programsdiscussed above decreased operating income by $5.8 million in 2005. Excludingthese effects, operating income increased $0.6 million or 0.6% over 2004. Thisincrease was a result of a gross profit increase of $19.3 million offset by anSG&A increase of $18.7 million. The increase in SG&A reflects themajority of the investments in personnel and costs incurred related to ourcompliance with the Sarbanes-Oxley Act, partially offset by the lowerprovisions for bonus, discussed in SG&A above. Operating income in theNorth American Lab segment for 2004 increased $11.0 million or 13.3% from 2003.The year-over-year improvement was primarily due to higher supplier rebates andsales and gross profit growth rates exceeding the SG&A expense growth rateas the result of productivity initiatives taken to reduce costs during thethird quarter of 

26

----

2003. Strengtheningforeign currencies positively affected operating income by $1.8 million for2004 compared to 2003.

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

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

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

Interest expense, net ofinterest income was $74.3 million, $56.3 million and $24.4 million for 2005,2004 and 2003, respectively. The 2005 increase was due to the new capitalstructure from the Acquisition being in place for the entire year and highervariable interest rates on our Senior Secured Credit Facility during 2005 than2004. The 2004 increase was due to the new capital structure that wasestablished in connection with the Acquisition that resulted in a higher levelof outstanding debt as well as an increase in interest rates.

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

Other (income)/expense,net was ($3.9) million, ($1.9) million and ($3.0) million for 2005, 2004 and2003, respectively. Income in 2005 included net exchange gains of ($2.9)million, equity income of ($0.5) million and net gains on sale of assets of($0.5) million. Income in 2004 included net exchange gains of ($1.5) millionand equity income of ($0.5) million. Income in 2003 included net gains on saleof assets of ($1.4) million, ($1.0) million related to an insurance recoveryand equity income of ($0.6) million.

***Income Tax Provision***

The effective income taxrate was 42.6%, 42.3% and 41.5% for 2005, 2004 and 2003, respectively. Theeffective tax rates for 2005 and 2004 were higher than 2003 primarily as aresult of the valuation allowance required for losses incurred in France andforeign tax credits in the U.S.

27

----

**Historical Cash Flows**

***Cash Flows from Operating Activities***

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

| ** **                                            | ** ** | **Years Ended December 31,** | ** ** |
|-------------------------------------------------------|------------|---------------------------------------------|------------|
| ** **                                            | ** ** | **2005**                                    | ** ** | **2004** | ** ** | **2003** | ** ** |
| Cash flow from  operations, excluding working capital |       | $                                           | 100.0      |   | $ | 100.5 |   | $ | 123.7 |   |
| Cash flow from  working capital changes, net          |       | (30.0                                       | )          | 84.2 |   | 31.4 |   |
| Cash flow from  operations                            |       | $                                           | 70.0       |   | $ | 184.7 |   | $ | 155.1 |   |

 

We generated $70.0 millionof cash flow from operations during 2005 compared to $184.7 million during2004. The decrease in cash from operations is a result of increased levels ofworking capital  in 2005 as compared to2004. In 2005, cash flow from working capital changes used cash primarily for cashpayments for restructuring charges of $34.9 million and increases ininventories of $29.0 million. These cash usages were partially offset by anincrease in our accounts payable of $32.4 million.

We generated $184.7million of cash flow from operations during 2004 compared to $155.1 millionduring 2003. The improvement in cash from operations was primarily the resultof improvements in working capital management partially offset by a decline innet income resulting from higher interest expense. The significant improvementin cash flow from working capital changes was the result of increased focus bythe Company’s management in the areas of accounts payable and inventory thatwas partially offset by an increase in trade accounts receivable.

Days sales outstanding inaccounts receivable were 48.2, 49.0 and 48.9 days as of December 31, 2005,2004 and 2003, respectively. Days sales outstanding are higher in Europe due tothe extended payment practices in the countries in which we operate.

Days supply in inventorywere 43.1, 39.1 and 46.6 days as of December 31, 2005, 2004 and 2003,respectively. The 2005 increase is a result of changes in our supplier networkand the stocking of products from new suppliers. The 2004 decrease was dueprimarily to efforts to reduce inventory levels while maintaining customerservice levels.

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

***Cash Flows fromInvesting Activities***

Net cash used in investingactivities was $62.2 million, $1,576.3 million and $8.9 million for the yearsended December 31, 2005, 2004 and 2003, respectively. The 2005 usageprimarily related to investments to acquire businesses of $46.0 million andcapital expenditures of $18.4 million. The 2004 usage primarily related to theAcquisition and capital expenditures of $16.4 million. The 2003 usage relatedto capital expenditures of $16.6 million, offset by proceeds from sales ofproperty and equipment of $7.7 million.

Our capital expendituresconsist of two principal components: expenditures for facilities andexpenditures for technology to support the business. The timing of warehouseexpansions may cause a variance in year-to-year capital expenditures. Weanticipate 2006 capital expenditures to approximate $40.0 million. Thesignificant components of these expenditures will include expansion in PuertoRico and other improvements in operating capacity; upgrading our manufacturingfacilities in Belgium and France; and investments in information technology tosupport certain business initiatives.

28

----

***Cash Flows from Financing Activities***

Net cash provided by (usedin) financing activities was $4.3 million, $1,606.7 million and ($144.8) million for the years ended December 31,2005, 2004 and 2003, respectively. The 2005 cash provided is comprised of a netincrease in our bank checks outstanding of $15.0 million, partially offset bynet debt payments of $10.7 million. The net cash provided in 2004 was primarilya result of the Acquisition, the new capital structure we established, a netincrease in our bank checks outstanding and proceeds from the CDRV Investors, Inc.Stock Incentive Plan. The 2003 usage primarily related to net debt repayments.

***Liquidity and Capital Resources***

We broadly define liquidity as our ability to generatesufficient funds from both internal and external sources to meet ourobligations and commitments. In addition, liquidity includes the ability toobtain appropriate debt and equity financing. Therefore, liquidity cannot beconsidered separately from capital resources that consist of current orpotentially available funds for use in achieving long-range objectives andmeeting debt service commitments.

As of December 31, 2005, we had outstandingindebtedness of $1,063.8 million, which consists primarily of $520.0 millionaggregate principal amount of notes, a $379.9 million U.S. dollar-denominatedterm loan and a $157.2 million Euro-denominated term loan. Cash paid forinterest during 2005 was $70.4 million as compared to $35.2 million in 2004.Our debt levels increased slightly and related interest rates increased moresignificantly as a result of the Acquisition and our cash paid for interestexpense has increased significantly since April 7, 2004. Based onborrowings outstanding and interest rates in effect as of December 31,2005, interest expense for the year ending December 31, 2006 is expectedto be reasonably consistent with the 2005 amount. Prior to the Acquisition,interest on our push down debt did not represent cash interest, as we were notrequired to pay Merck KGaA interest. The interest expense associated with thepush down debt was recorded as a capital contribution by Merck KGaA, net oftax.

As of December 31, 2005, we had $11.6 million ofundrawn letters of credit and our remaining borrowing availability under the$150.0 million multi-currency revolving credit facility forming part of ourSenior Secured Credit Facility was $138.4 million. Undrawn amounts under themulti-currency revolving credit facility will be available to meet futureworkingcapital and our other business needs. As borrowings under the multi-currencyrevolving credit facility may fluctuate with our working capital and other businessneeds, and the borrowings thereunder bear interest at variable rates, interestexpense for this facility will fluctuate as well.

Under the credit agreementfor our Senior Secured Credit Facility, beginning in 2006, Excess Cash Flow (asdefined in the credit agreement) from the prior year will berequiredto be used toprepay credit agreement debt. On March 31, 2006,$44.4 million will be repaid as required by the Excess Cash Flow provisions ofthe Senior Secured Credit Facility. Based upon current levels of operations andexpectations as to future growth, we believe that cash on hand, generated fromoperations, together with amounts available under our $150.0 millionmulti-currency revolving credit facility which is a component of our SeniorSecured Credit Facility, will be adequate to permit us to meet our debt serviceobligations, capital expenditure requirements, ongoing operating costs andworking capital needs until the maturity of our Senior Secured Credit Facility,although no assurance can be given in this regard. Our future financial andoperating performance, ability to service or refinance our debt and ability tocomply with covenants and restrictions contained in our debt agreements will besubject to future economic conditions and to financial, business and otherfactors, many of which are beyond our control and will be substantiallydependent on the global economy, demand for our products, and our ability tosuccessfully implement our overall business and profitability strategies. As ofDecember 31, 2005, we had $126.1 million of cash and cash equivalents onhand.

29

----

**Scheduleof Contractual Obligations**

Thefollowing tables detail the payment schedule for debt, capital leases andoperating leases asof December 31, 2005 (dollars inmillions):

| ** **                                         | ** ** | **<1 year** | ** ** | **1-3 years** | ** ** | **4-5 years** | ** ** | **>5 years** | ** ** | **Total** | ** ** |
|----------------------------------------------------|------------|---------------------|------------|--------------------|------------|--------------------|------------|----------------------|------------|-----------|------------|
| Senior Secured  Credit Facility                    |       |                | $          | 44.4               | (1)        |               |       | $                    | 10.0       |      |       |   | $ | 246.8 |   |   |   | $ | 235.9 |   |   | $ | 537.1 |   |
| 67¤8%  Unsecured Senior Notes due 2012        |       |                | —     |               |       |               | —     |                 |       |      | —     |   |   |   | 200.0 |   |   | 200.0 |   |
| 8% Unsecured  Senior Subordinated   Notes due 2014 |       |                | —     |               |       |               | —     |                 |       |      | —     |   |   |   | 320.0 |   |   | 320.0 |   |
| Loan from CDRV  Holdings, Inc.                |       |                | —     |               |       |               | —     |                 |       |      | —     |   |   |   | 0.6 |   |   | 0.6 |   |
| Bank loans                                         |       |                | 0.3        |               |       |               | —     |                 |       |      | —     |   |   |   | — |   |   | 0.3 |   |
| Capital leases                                     |       |                | 0.8        |               |       |               | 1.4        |                 |       |      | 1.3        |   |   |   | 2.3 |   |   | 5.8 |   |
| Operating leases                                   |       |                | 23.8       |               |       |               | 36.2       |                 |       |      | 23.5       |   |   |   | 30.7 |   |   | 114.2 |   |
| Total                                              |       |                | $          | 69.3               |       |               |       | $                    | 47.6       |      |       |   | $ | 271.6 |   |   |   | $ | 789.5 |   |   | $ | 1,178.0 |   |

----

(1)          Reflectsthe amount due in March 2006 based on Excess Cash Flow generated in 2005.

Priorto the Acquisition, substantially all of our debt was with Merck KGaA andaffiliates at an average interest rate of 2.0% to 2.8%. The push down debtreflects the debt incurred by Merck KGaA as a result of its acquisition of us.A portion of the cash consideration for the Acquisition was used to repay alldebt owing to Merck KGaA and affiliates outstanding on April 7, 2004.

**IndebtednessFollowing the Acquisition**

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

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

The indentures governingthe senior notes and the senior subordinated notes contain certain covenantsthat limit the Company’s ability to incur additional indebtedness, pay cashdividends and make certain other payments. The indentures also require theCompany to maintain certain financial covenants, including a specified debt to ConsolidatedEBITDA leverage ratio and a specified Consolidated EBITDA to interest expensecoverage ratio. At December 31, 2005, the Company was in compliance withall covenants.

30

----

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

**CreditAgreement Financial Covenants; Credit Agreement EBITDA**

Borrowings under ourSenior Secured Credit Facility are a key source of our liquidity. Our abilityto borrow under our Senior Secured Credit Facility is dependent upon, amongother things, our compliance with the financial covenants that limit theCompany’s ability to incur additional indebtedness, pay cash dividends and makecertain other payments as set forth in the credit agreement for our SeniorSecured Credit Facility. The financial covenants include a specified debt toCredit Agreement EBITDA leverage ratio and a specified Credit Agreement EBITDAto interest expense coverage ratio for specified periods. Failure to complywith these financial ratio covenants would result in a default under the creditagreement for our Senior Secured Credit Facility and, absent a waiver or anamendment from our lenders, would permit the acceleration of all outstandingborrowings under our Senior Secured Credit Facility. We were in compliance withthese financial covenants as of December 31, 2005.

Credit Agreement EBITDA aspresented herein is a financial measure that is used in the credit agreementfor our Senior Secured Credit Facility. Credit Agreement EBITDA is not adefined term under U.S. GAAP and should not be considered as an alternative tooperating income or net income as a measure of operating results or cash flowsas a measure of liquidity. Credit Agreement EBITDA differs from the term “EBITDA”as it is commonly used. Credit Agreement EBITDA generally is defined asconsolidated net income before consolidated net interest expense, consolidatedincome taxes, consolidated depreciation and amortization, other non-cashcharges deducted in determining consolidated net income (loss), non-cashprovisions for reserves for discontinued operations, extraordinary, unusual ornon-recurring items, gain or loss associated with the sale or write down ofassets not in the ordinary course of business and the cumulative effect ofaccounting changes and earnings of, but including cash dividends ordistributions from, non-controlled affiliates. Credit Agreement EBITDA isreduced by the amount of certain permitted dividends to CDRV Holdings, Inc.

Credit Agreement EBITDA isnot used in the indentures for the notes. The term “Consolidated EBITDA” isused in the indentures as part of the calculation of the term “ConsolidatedCoverage Ratio”, which is used for a number of purposes, including determiningour ability to incur additional indebtedness, and may include certain costsavings or synergies. “Consolidated EBITDA” is not the same as Credit AgreementEBITDA.

Thefollowing table presents a calculation of Credit Agreement EBITDA for the yearended December 31, 2005 (dollars in millions):

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

----

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

31

----

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

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

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

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

 

Thetable below sets forth the specified debt to Credit Agreement EBITDA leverageratio and Credit Agreement EBITDA to interest expense ratio for the year endedDecember 31, 2005:

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

----

 

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

**Debt of CDRVInvestors, Inc.**

On December 16, 2004,CDRV Investors, Inc., our indirect parent, issued $481.0 million aggregateprincipal amount at maturity ($297.9 million in net proceeds) of 95¤8%senior discount notes due 2015 (“CDRV Senior Discount Notes”). The net proceedsof the issuance were used to pay a dividend to the holders of the common stockof CDRV Investors, Inc. The CDRV Senior Discount Notes are seniorunsecured obligations of CDRV Investors, Inc. and are structurallysubordinated to all obligations and other liabilities of CDRVInvestors, Inc.’s existing and future subsidiaries, including us. No cashinterest will accrue on the CDRV Senior Discount Notes prior to January 1,2010. Thereafter, cash interest will accrue and be payable semiannually, onlyto the extent of funds actually available for distribution to CDRVInvestors, Inc. under specified provisions of the indentures governing oursenior notes and senior subordinated notes and applicable law. As ofDecember 31, 2005, the accreted value of the CDRV Senior Discount Noteswas $330.2 million.

We do not guarantee theobligations under the CDRV Senior Discount Notes. The terms of the SeniorSecured Credit Facility and the indentures governing our senior notes andsenior subordinated notes, significantly restrict us from making distributionsand otherwise transferring assets to CDRV Investors, Inc.

32

----

**Critical Accounting Policies**

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

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

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

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

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

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

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

33

----

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

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

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

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

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

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

**New Accounting Standards**

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

34

----

permitted to follow theintrinsic value accounting method of APB No. 25, and SFAS No. 123Rwill apply to all of CDRV’s outstanding unvested options as of January 1,2006 and all prospective awards using the modified prospective transitionmethod without restatement of prior periods. The impact this Statement willhave on the Company’s results of operations will be substantially consistentwith the pro-forma amounts shown in Note 2(o) in our consolidatedfinancial statements.

During November 2004,the FASB issued SFAS No. 151, *InventoryCosts*. This Statement clarifies the accounting for abnormal amountsof idle facility expenses, freight handling costs, and spoilage. This Statementrequires such excess costs be charged as current-period expenses. This Statementalso specifies that allocated overhead costs to inventory must be based onnormal capacity measures. This Statement becomes effective for inventory costsincurred beginning January 1, 2006. The adoption of this standard is notexpected to materially impact the Company.

**Forward-Looking Statements**

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

·                    managementforecasts;

·                    efficienciesand cost savings;

·                    incomeand margins;

·                    growth;

·                    economiesof scale;

·                    theeconomy;

·                    futureeconomic performance;

·                    futureacquisitions and dispositions;

·                    litigation;

·                    potentialand contingent liabilities;

·                    management’splans;

·                    taxes;and

·                    refinancingof debt.

Forward-lookingstatements are not guarantees of performance. You should not place unduereliance on these statements. You should understand that the followingimportant factors, in addition to those discussed in “Item 1A—Risk Factors” andelsewhere in this Form 10-K, could affect our future results and 

35

----

couldcause those results or other outcomes to differ materially from those expressedor implied in our forward-looking statements:

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

·                    ourability to maintain our relationships with manufacturers;

·                    lossof our key executive officers;

·                    ourability to consummate and integrate potential acquisitions;

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

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

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

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

**Market and Industry Data**

Information in this Form 10-Kabout the global research laboratory industry, including our generalexpectations concerning the industry, are based on estimates prepared usingdata from various sources and on assumptions made by us. We believe dataregarding the global research laboratory industry are inherently imprecise, butbased on management’s understanding of the markets in which we compete,management believes that such data is generally indicative of the industry. Ourestimates, in particular as they relate to our general expectations concerningthe global research laboratory industry, involve risks and uncertainties andare subject to change based on various factors, including those discussed underthe headings “Risk Factors Related to Our Capital Structure” and “Risk FactorsRelated to Our Business”  in “Item 1A—RiskFactors”.

**ITEM 7A.   QUANTITATIVE AND QUALITATIVEDISCLOSURES ABOUT MARKET RISK**

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

In the future, we may use interest rate swaps or otherderivatives to manage interest rate risk on future income caused by interestrate changes on the variable rate facilities under our Senior Secured CreditFacility. If swaps are used, the differential to be paid or received under theagreements is recognized as an adjustment to interest expense related to thedebt. Our Senior Secured Credit Facility requires us to enter into interestrate protection agreements which, together with fixed interest rates thenapplicable to our consolidated funded indebtedness, will provide interest rateprotection with respect to at least 50% of our consolidated funded indebtednessfor a period of time. Effective July 21, 2004, we entered into an interestrate cap to hedge a portion of the variability of cash flows related topotential changes in interest rates on €35.0million of our Euro-denominated term loan facility.

36

----

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

Where we deem it prudent, we have engaged in hedgingprograms, using primarily foreign currency forward contracts, aimed at limitingthe impact of foreign currency exchange rate fluctuations on cash flows andearnings. Cash flows from currency forward contracts accounted for as hedgesare classified in the statement of cash flows in the same category as the itembeing hedged or on a basis consistent with the nature of the instrument. Theseactivities have not been material to our financial statements. We may purchaseshort-term foreign currency forward contracts to protect against currencyexchange risks associated with long-term intercompany loans due from ourinternational subsidiaries and the payment of merchandise purchases to foreignvendors. The majority of our debt, including the notes, is denominated in U.S.dollars, and accordingly, the majority of our future debt service needs will beU.S. dollar denominated. We have a Euro-denominated term loan in an aggregateprincipal amount equal to €132.7 million(approximately $157.2 million as of December 31, 2005, on a U.S. dollarequivalent basis) and a $150.0 million multi-currency revolving credit facilityforming part of our Senior Secured Credit Facility, as well as borrowings undercertain local credit facilities, each of which partially mitigates our currencyrisk with respect to future debt service. Net sales and costs tend to beincurred in the same currency, and therefore mitigate local currency risk.

37

----

**ITEM 8.**                FINANCIALSTATEMENTS AND SUPPLEMENTARY DATA

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

The term “Successor” refers to VWR International, Inc.following the Acquisition. The term “Predecessor” refers to VWR InternationalCorporation prior to the Acquisition on April 7, 2004. 

|                                                                                                                                                                                                                                                  | ** ** |        | **Page** | ** ** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|--------|----------|------------|
| **VWR INTERNATIONAL, INC.  (Predecessor and Successor)**                                                                                                                                                                                         |       |   |     |       |
| Report of Independent Registered Public Accounting  Firm                                                                                                                                                                                         |       |   | 39       |       |
| Consolidated Balance Sheets as of December 31,  2005 and 2004                                                                                                                                                                               |       |   | 40       |       |
| Consolidated Statements of Operations for the year  ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003                                                       |       |   | 41       |       |
| Consolidated Statements of Stockholders’ Equity and  Other Comprehensive Income (Loss) for the year ended December 31, 2005,  the periods included in the year ended December 31, 2004 and the year  ended December 31, 2003 |       |   | 42       |       |
| Consolidated Statements of Cash Flows for the year  ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003                                                       |       |   | 44       |       |
| Notes to Consolidated Financial Statements                                                                                                                                                                                                       |       |   | 45       |       |
| Schedule II—Valuation and Qualifying Accounts for  the year ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003.                                    |       |   | 112      |       |

 

 

38

----

**Report of Independent Registered Public AccountingFirm**

The Board of Directors and StockholdersVWR International, Inc.:

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

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

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

As discussed in Note 1 to the consolidated financialstatements, effective April 7, 2004, CDRV Acquisition Corporation (whichmerged into VWR International, Inc.) acquired all of the outstanding stockof VWR International Corporation in a business combination accounted for as apurchase. As a result of the acquisition, the consolidated financialinformation for the periods after the acquisition are presented on a differentcost basis than that for the periods before the acquisition and, therefore, arenot comparable.

As discussed in Note3 to the consolidated financial statements, effective December 31,2005, the Company adopted the provisions of FASB Interpretation No. 47, *Accounting for Conditional Asset RetirementObligations*.

/s/ KPMG LLP

Philadelphia, PennsylvaniaMarch 30, 2006

39

----

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

| ** **                                                                          | ** ** | **December 31,** | ** ** |
|-------------------------------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                                          | ** ** | **2005**              | ** ** | **2004** | ** ** |
| **Assets**                                                                          |       |                  |       |   |   |
| Current Assets:                                                                     |       |                  |       |   |   |
| Cash and cash equivalents                                                           |       | $                     | 126.1      |   | $ | 116.1 |   |
| Trade accounts receivable, less reserves of $6.6 and  $6.0, respectively            |       | 407.3                 |       | 413.4 |   |
| Other receivables                                                                   |       | 30.8                  |       | 25.3 |   |
| Inventories                                                                         |       | 270.4                 |       | 248.9 |   |
| Other current assets                                                                |       | 30.6                  |       | 27.1 |   |
| Total current assets                                                                |       | 865.2                 |       | 830.8 |   |
| Property and  equipment, net                                                        |       | 156.8                 |       | 154.4 |   |
| Investments                                                                         |       | 7.8                   |       | 8.7 |   |
| Goodwill                                                                            |       | 910.0                 |       | 907.0 |   |
| Other intangible  assets, net                                                       |       | 552.7                 |       | 570.8 |   |
| Deferred income  taxes                                                              |       | 5.6                   |       | 34.4 |   |
| Other assets                                                                        |       | 44.3                  |       | 44.8 |   |
| Total assets                                                                        |       | $                     | 2,542.4    |   | $ | 2,550.9 |   |
| **Liabilities  and Stockholders’ Equity**                                      |       |                  |       |   |   |
| Current Liabilities:                                                                |       |                  |       |   |   |
| Short-term portion of bank debt and current portion  of capital lease obligations   |       | $                     | 45.5       |   | $ | 12.9 |   |
| Accounts payable                                                                    |       | 370.3                 |       | 333.8 |   |
| Accrued expenses                                                                    |       | 143.4                 |       | 150.4 |   |
| Total current liabilities                                                           |       | 559.2                 |       | 497.1 |   |
| Long-term debt                                                                      |       | 1,013.3               |       | 1,080.2 |   |
| Capital lease  obligations                                                          |       | 5.0                   |       | 6.1 |   |
| Other long-term  liabilities                                                        |       | 87.1                  |       | 86.2 |   |
| Deferred income  taxes                                                              |       | 233.5                 |       | 241.1 |   |
| Total liabilities                                                                   |       | 1,898.1               |       | 1,910.7 |   |
| Parent Company  common stock purchase subject to guarantee agreement (Note 14) |       | 2.6                   |       | 2.9 |   |
| Commitments and  contingences (Note 16)                                             |       |                  |       |   |   |
| Stockholders’ equity:                                                          |       |                  |       |   |   |
| Common stock, $0.01 par value; 100 shares  authorized, issued and outstanding       |       | —                |       | — |   |
| Additional paid-in capital                                                          |       | 557.4                 |       | 552.3 |   |
| Retained earnings                                                                   |       | 73.2                  |       | 31.9 |   |
| Unamortized value of restricted stock issued                                        |       | (1.6                  | )          | (0.3 | ) |
| Accumulated other comprehensive income                                              |       | 12.7                  |       | 53.4 |   |
| Total stockholders’ equity                                                     |       | 641.7                 |       | 637.3 |   |
| Total liabilities and  stockholders’ equity                                    |       | $                     | 2,542.4    |   | $ | 2,550.9 |   |

 

See accompanying notes to consolidated financial statements

40

----

**VWRINTERNATIONAL, INC.Consolidated Statements of Operations(Dollars in millions)**

| ** **                                                                            | ** ** | **Successor**         | ** ** | ** **              | ** ** | **Predecessor** | ** ** |
|---------------------------------------------------------------------------------------|------------|-----------------------|------------|-------------------------|------------|-----------------|------------|
| ** **                                                                            | ** ** | **Year Ended**   | ** ** | **April 7 -** | ** ** | ** **      | ** ** | **January 1 -** | ** ** | **Year Ended** | ** ** |
| ** **                                                                            | ** ** | **December 31,** | ** ** | **December 31,**   | ** ** | ** **      | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                                                            | ** ** | **2005**              | ** ** | **2004**                | ** ** | ** **      | ** ** | **2004** | ** ** | **2003** | ** ** |
| Net sales                                                                             |       |                  | $          | 3,138.2                 |       |            |       | $ | 2,212.2 |   |   |   |   |   | $ | 793.2 |   |   |   | $ | 2,794.2 |   |   |
| Cost of goods  sold                                                                   |       |                  | 2,334.5    |                    |       |            | 1,652.7    |   |   |   |   |   | 588.0 |   |   |   | 2,078.1 |   |   |
| Gross profit                                                                          |       |                  | 803.7      |                    |       |            | 559.5      |   |   |   |   |   | 205.2 |   |   |   | 716.1 |   |   |
| Selling, general  and administrative expenses                                         |       |                  | 639.9      |                    |       |            | 455.4      |   |   |   |   |   | 163.7 |   |   |   | 583.4 |   |   |
| Restructuring  charges (Note 4)                                                       |       |                  | 20.6       |                    |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Operating income                                                                      |       |                  | 143.2      |                    |       |            | 104.1      |   |   |   |   |   | 41.5 |   |   |   | 132.7 |   |   |
| Interest income                                                                       |       |                  | (2.7       | )                       |       |            | (0.8       | ) |   |   |   |   | (0.2 | ) |   |   | (1.7 | ) |   |
| Interest expense:                                                                     |       |                  |       |                    |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest on push down debt                                                            |       |                  | —     |                    |       |            | —     |   |   |   |   |   | 4.1 |   |   |   | 15.2 |   |   |
| All other interest                                                                    |       |                  | 77.0       |                    |       |            | 51.5       |   |   |   |   |   | 1.7 |   |   |   | 10.9 |   |   |
| Other (income)  expense, net                                                          |       |                  | (3.9       | )                       |       |            | (2.0       | ) |   |   |   |   | 0.1 |   |   |   | (3.0 | ) |   |
| Income before  income taxes and cumulative effect of a change in accounting principle |       |                  | 72.8       |                    |       |            | 55.4       |   |   |   |   |   | 35.8 |   |   |   | 111.3 |   |   |
| Income tax provision                                                                  |       |                  | 31.0       |                    |       |            | 23.5       |   |   |   |   |   | 15.1 |   |   |   | 46.2 |   |   |
| Income before  cumulative effect of a change in accounting principle                  |       |                  | 41.8       |                    |       |            | 31.9       |   |   |   |   |   | 20.7 |   |   |   | 65.1 |   |   |
| Cumulative effect  of a change in accounting principle, net of taxes of $0.3 (Note 3) |       |                  | (0.5       | )                       |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Net income                                                                            |       |                  | $          | 41.3                    |       |            |       | $ | 31.9 |   |   |   |   |   | $ | 20.7 |   |   |   | $ | 65.1 |   |   |

 

See accompanying notes to consolidated financial statements.

41

----

**VWRINTERNATIONAL, INC.Consolidated Statements of Stockholders’ Equity andOther Comprehensive Income (Loss)(Dollars in millions, except share data)For the Period January 1, 2003—April 6, 2004 (Predecessor)**

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

 

See accompanying notes to consolidated financial statements.

42

----

**VWR INTERNATIONAL,INC.Consolidated Statements of Stockholders’ Equity andOther Comprehensive Income (Loss)(Dollars in millions, except share data)For the Period April 7, 2004—December 31, 2005 (Successor)**

| ** **                                                                        | ** ** | ** ** | ** ** | ** **     | ** ** | ** **   | ** ** | **Unamortized**       | ** ** | **Accumulated**        | ** ** | ** ** | ** ** |
|-----------------------------------------------------------------------------------|------------|------------|------------|----------------|------------|--------------|------------|-----------------------|------------|------------------------|------------|------------|------------|
| ** **                                                                        | ** ** | ** ** | ** ** | **Additional** | ** ** | ** **   | ** ** | **value of**     | ** ** | **other**              | ** ** | ** ** | ** ** |
| ** **                                                                        | ** ** | **Common** | ** ** | **paid-in**    | ** ** | **Retained** | ** ** | **restricted**        | ** ** | **comprehensive**      | ** ** | ** ** | ** ** |
| ** **                                                                        | ** ** | **stock**  | ** ** | **capital**    | ** ** | **earnings** | ** ** | **stock issued** | ** ** | **income (loss)** | ** ** | **Total**  | ** ** |
| Balance at  April 7, 2004                                                    |       |       | $          | —         |       |         |       | $                     | —     |                   |       |       | $          | — |   |   |   | $ | — |   |   |   | $ | — |   |   | $ | — |   |
| Issuance of 100 shares of common stock, net of  expenses                          |       |       | —     |           |       |         | 530.5      |                  |       |                   | —     |       |       |   | — |   |   |   | — |   |   | 530.5 |   |
| Capital contributions (Note 14)                                                   |       |       | —     |           |       |         | 21.5       |                  |       |                   | —     |       |       |   | — |   |   |   | — |   |   | 21.5 |   |
| Issuance of Parent Company restricted common stock,  net (Note 15)                |       |       | —     |           |       |         | 0.3        |                  |       |                   | —     |       |       |   | (0.3 | ) |   |   | — |   |   | — |   |
| Comprehensive  income (loss):                                                     |       |       |       |           |       |         |       |                  |       |                   |       |       |       |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                        |       |       | —     |           |       |         | —     |                  |       |                   | 31.9       |       |       |   | — |   |   |   | — |   |   | 31.9 |   |
| Foreign currency translation adjustment                                           |       |       | —     |           |       |         | —     |                  |       |                   | —     |       |       |   | — |   |   |   | 54.1 |   |   | 54.1 |   |
| Unrealized loss on derivatives, net of tax                                        |       |       | —     |           |       |         | —     |                  |       |                   | —     |       |       |   | — |   |   |   | (0.7 | ) |   | (0.7 | ) |
| Total comprehensive income                                                        |       |       |       |           |       |         |       |                  |       |                   |       |       |       |   |   |   |   |   |   |   |   | 85.3 |   |
| Balance at  December 31, 2004                                                |       |       | —     |           |       |         | 552.3      |                  |       |                   | 31.9       |       |       |   | (0.3 | ) |   |   | 53.4 |   |   | 637.3 |   |
| Capital contributions (Note 14)                                                   |       |       | —     |           |       |         | 3.5        |                  |       |                   | —     |       |       |   | — |   |   |   | — |   |   | 3.5 |   |
| Issuance of Parent Company restricted common stock,  net (Note 15)                |       |       | —     |           |       |         | 1.3        |                  |       |                   | —     |       |       |   | (1.3 | ) |   |   | — |   |   | — |   |
| Reduction of Parent Company common stock purchase  subject to guarantee agreement |       |       | —     |           |       |         | 0.3        |                  |       |                   | —     |       |       |   | — |   |   |   | — |   |   | 0.3 |   |
| Comprehensive  income (loss):                                                     |       |       |       |           |       |         |       |                  |       |                   |       |       |       |   |   |   |   |   |   |   |   |   |   |
| Net income                                                                        |       |       | —     |           |       |         | —     |                  |       |                   | 41.3       |       |       |   | — |   |   |   | — |   |   | 41.3 |   |
| Minimum pension liability, net of taxes of $7.6                                   |       |       | —     |           |       |         | —     |                  |       |                   | —     |       |       |   | — |   |   |   | (11.9 | ) |   | (11.9 | ) |
| Foreign currency translation adjustment                                           |       |       | —     |           |       |         | —     |                  |       |                   | —     |       |       |   | — |   |   |   | (29.2 | ) |   | (29.2 | ) |
| Unrealized gain on derivatives, net of tax                                        |       |       | —     |           |       |         | —     |                  |       |                   | —     |       |       |   | — |   |   |   | 0.4 |   |   | 0.4 |   |
| Total comprehensive income                                                        |       |       |       |           |       |         |       |                  |       |                   |       |       |       |   |   |   |   |   |   |   |   | 0.6 |   |
| Balance at  December 31, 2005                                                |       |       | $          | —         |       |         |       | $                     | 557.4      |                   |       |       | $          | 73.2 |   |   |   | $ | (1.6 | ) |   |   | $ | 12.7 |   |   | $ | 641.7 |   |

 

See accompanying notes to consolidated financial statements.

43

----

**VWR INTERNATIONAL, INC.Consolidated Statementsof Cash Flows(Dollars in millions)**

| ** **                                                                                | ** ** | **Successor**         | ** ** | ** **             | ** ** | **Predecessor** | ** ** |
|-------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|-----------------|------------|
| ** **                                                                                | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | ** **      | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                                                                                | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | ** **      | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                                                                | ** ** | **2005**              | ** ** | **2004**               | ** ** | ** **      | ** ** | **2004** | ** ** | **2003** | ** ** |
| Cash flows from operating  activities:                                                    | ** ** |                  | ** ** | ** **             |       |            | ** ** | ** ** |   |   |   |   | ** ** | ** ** |   |   | ** ** | ** ** |   |
| Net income                                                                                |       |                  | $          | 41.3                   |       |            |       | $ | 31.9 |   |   |   |   |   | $ | 20.7 |   |   |   | $ | 65.1 |   |   |
| Adjustments to  reconcile net income to net cash provided by operating activities:        |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Depreciation and amortization                                                             |       |                  | 33.9       |                   |       |            | 25.8       |   |   |   |   |   | 8.9 |   |   |   | 32.9 |   |   |
| Gain on sale of assets                                                                    |       |                  | (0.5       | )                      |       |            | —     |   |   |   |   |   | — |   |   |   | (1.4 | ) |   |
| Cumulative effect of a change in accounting principle                                     |       |                  | 0.5        |                   |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Interest on push down debt, net of tax                                                    |       |                  | —     |                   |       |            | —     |   |   |   |   |   | 2.5 |   |   |   | 9.1 |   |   |
| Non-cash provision for restructuring charges                                              |       |                  | 11.5       |                   |       |            | —     |   |   |   |   |   | — |   |   |   | — |   |   |
| Amortization of debt issuance costs                                                       |       |                  | 5.3        |                   |       |            | 3.7        |   |   |   |   |   | — |   |   |   | — |   |   |
| Deferred income tax expense                                                               |       |                  | 4.8        |                   |       |            | 3.0        |   |   |   |   |   | 0.9 |   |   |   | 14.0 |   |   |
| Provision for doubtful accounts                                                           |       |                  | 3.2        |                   |       |            | 2.5        |   |   |   |   |   | 0.6 |   |   |   | 4.0 |   |   |
| Changes in working  capital, net of effect of business acquisitions:                      |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Trade accounts receivable                                                                 |       |                  | (14.6      | )                      |       |            | 4.9        |   |   |   |   |   | (26.8 | ) |   |   | 2.3 |   |   |
| Other receivables                                                                         |       |                  | (8.3       | )                      |       |            | (7.0       | ) |   |   |   |   | 8.7 |   |   |   | 1.5 |   |   |
| Inventories                                                                               |       |                  | (29.0      | )                      |       |            | 20.5       |   |   |   |   |   | 17.5 |   |   |   | 13.4 |   |   |
| Other assets                                                                              |       |                  | (2.0       | )                      |       |            | (0.9       | ) |   |   |   |   | 1.9 |   |   |   | 7.8 |   |   |
| Accounts payable                                                                          |       |                  | 32.4       |                   |       |            | 0.2        |   |   |   |   |   | 61.7 |   |   |   | 4.6 |   |   |
| Other liabilities                                                                         |       |                  | (8.5       | )                      |       |            | 2.6        |   |   |   |   |   | 0.9 |   |   |   | 1.8 |   |   |
| Net cash provided by operating activities                                                 |       |                  | 70.0       |                   |       |            | 87.2       |   |   |   |   |   | 97.5 |   |   |   | 155.1 |   |   |
| Cash flows from investing  activities:                                                    |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Payment to Merck KGaA and affiliates to acquire  business, net of cash acquired of $130.8 |       |                  | —     |                   |       |            | (1,538.3   | ) |   |   |   |   | — |   |   |   | — |   |   |
| Transaction costs                                                                         |       |                  | (1.5       | )                      |       |            | (20.5      | ) |   |   |   |   | — |   |   |   | — |   |   |
| Acquisitions of businesses                                                                |       |                  | (44.5      | )                      |       |            | (2.7       | ) |   |   |   |   | — |   |   |   | — |   |   |
| Capital expenditures                                                                      |       |                  | (18.4      | )                      |       |            | (13.1      | ) |   |   |   |   | (3.3 | ) |   |   | (16.6 | ) |   |
| Proceeds from sales of property and equipment                                             |       |                  | 2.2        |                   |       |            | 1.2        |   |   |   |   |   | 0.4 |   |   |   | 7.7 |   |   |
| Net cash used in investing activities                                                     |       |                  | (62.2      | )                      |       |            | (1,573.4   | ) |   |   |   |   | (2.9 | ) |   |   | (8.9 | ) |   |
| Cash flows from financing  activities:                                                    |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from debt                                                                        |       |                  | 3.2        |                   |       |            | 1,168.2    |   |   |   |   |   | 13.3 |   |   |   | 136.2 |   |   |
| Repayment of debt                                                                         |       |                  | (13.9      | )                      |       |            | (111.1     | ) |   |   |   |   | (6.8 | ) |   |   | (265.5 | ) |   |
| Decrease (increase) in notes receivable from Merck  KGaA and affiliates                   |       |                  | —     |                   |       |            | —     |   |   |   |   |   | 4.1 |   |   |   | (9.1 | ) |   |
| Net change in bank checks outstanding                                                     |       |                  | 15.0       |                   |       |            | 25.0       |   |   |   |   |   | (2.1 | ) |   |   | (5.4 | ) |   |
| Issuance of 100 shares of common stock, net of  expenses                                  |       |                  | —     |                   |       |            | 530.5      |   |   |   |   |   | — |   |   |   | — |   |   |
| Proceeds from stock incentive plan                                                        |       |                  | —     |                   |       |            | 23.7       |   |   |   |   |   | — |   |   |   | — |   |   |
| Cash paid for debt issuance costs                                                         |       |                  | —     |                   |       |            | (38.1      | ) |   |   |   |   | — |   |   |   | — |   |   |
| Other                                                                                     |       |                  | —     |                   |       |            | —     |   |   |   |   |   | — |   |   |   | (1.0 | ) |   |
| Net cash provided by (used in) financing activities                                       |       |                  | 4.3        |                   |       |            | 1,598.2    |   |   |   |   |   | 8.5 |   |   |   | (144.8 | ) |   |
| Effect of exchange rate changes on cash                                                   |       |                  | (2.1       | )                      |       |            | 4.1        |   |   |   |   |   | (0.6 | ) |   |   | 2.2 |   |   |
| Net increase in cash and cash equivalents                                                 |       |                  | 10.0       |                   |       |            | 116.1      |   |   |   |   |   | 102.5 |   |   |   | 3.6 |   |   |
| Cash and cash equivalents beginning of period                                             |       |                  | 116.1      |                   |       |            | —     |   |   |   |   |   | 28.3 |   |   |   | 24.7 |   |   |
| Cash and cash equivalents end of period                                                   |       |                  | $          | 126.1                  |       |            |       | $ | 116.1 |   |   |   |   |   | $ | 130.8 |   |   |   | $ | 28.3 |   |   |
| Supplemental disclosures  of cash flow information:                                       |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Cash paid during  the period for:                                                         |       |                  |       |                   |       |            |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest                                                                                  |       |                  | $          | 70.4                   |       |            |       | $ | 33.9 |   |   |   |   |   | $ | 1.3 |   |   |   | $ | 11.3 |   |   |
| Income taxes paid,  net                                                                   |       |                  | $          | 12.6                   |       |            |       | $ | 29.1 |   |   |   |   |   | $ | 4.2 |   |   |   | $ | 33.9 |   |   |

 

See accompanying notes to consolidated financial statements.

44

----

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

**(1)   Backgroundand Nature of Operations**

VWR International, Inc. and its predecessor, VWRInternational Corporation, (“VWR”, the “Company” or “we”), distributescientific supplies, chemicals, and equipment, primarily in North America andEurope. The business is diversified across products and services, customergroups, and geography. VWR’s principal customers are pharmaceutical,biotechnology, chemical, technology, food processing, and consumer productcompanies; universities and research institutes; government agencies;environmental testing organizations; and primary and secondary schools.

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

VWR’s North American business was formerly the VWRScientific Products Corporation (“VWRSP”). In 1995, Merck KGaA, VWR’s ultimateparent company until April 7, 2004, headquartered in Darmstadt, Germany,agreed to acquire approximately 49.9% of the then-outstanding shares of VWRSP.In 1999, following a tender offer for the remaining shares; VWRSP became awholly-owned subsidiary of Merck KGaA (collectively, the “VWRSP Acquisition”)(See Note 5(c)).

Effective January 1, 2001, Merck KGaA combined,for management purposes only, VWR’s North American business with Merck KGaA’sEuropean business and the combined businesses operated under the name VWRInternational.

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

As more fully discussed in Note 5(a), on April 7,2004, Merck KGaA sold all of the outstanding shares of capital stock of VWRInternational Corporation to CDRV Acquisition Corporation (“CDRVA”), awholly-owned subsidiary of CDRV Holdings, Inc., a wholly-owned subsidiaryof CDRV Investors, Inc. (“CDRV”), for a purchase price of approximately$1,683.4, consisting of approximately $1,669.1 in cash and approximately $14.3of assumed debt (the “Acquisition”). In addition, direct acquisition costs ofapproximately $77.5 were incurred. CDRVA financed the Acquisition through a$549.2 equity investment, approximately $1,110.5 in various debt instruments,acquired cash of $70.1 and accrued expenses of $16.8.

In connection with the Acquisition, CDRVA issued$200.0 of 67¤8%Unsecured Senior Notes due 2012 and $320.0 of 8% Unsecured Senior SubordinatedNotes due 2014 and obtained financing under a new senior secured creditfacility (the “Senior Secured Credit Facility”). Following the completion of the Acquisition,there were a series of internal reorganizations, pursuant to which, among otherthings, (i) VWR International Corporation merged with and into VWRInternational, Inc., with VWR International, Inc. surviving, and (ii) thereafter,CDRVA merged with and into VWR International, Inc., with VWR International, Inc.surviving and assuming the obligations of CDRVA.

45

----

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

The term “successor” refers to VWR International, Inc.following the Acquisition. The term “predecessor” refers to VWR InternationalCorporation prior to the change in control on April 7, 2004. CDRVA had nooperations prior to the Acquisition.

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

The financial statements,for all periods presented prior to the Acquisition, reflect the push down ofthe purchase price paid by Merck KGaA for VWR to the VWR financial statementsthat resulted in the recognition of push down debt due Merck KGaA or acontribution to stockholders’ equity for cash consideration. For all periods priorto the Acquisition, interest expense was recorded on this push down debt basedupon Merck KGaA’s intercompany interest rates, which are not necessarilyindicative of rates VWR would have obtained if it were not an ultimatesubsidiary of Merck KGaA. Interest expense, including tax effects on push downdebt, has been included in the statements of operations, and presented as anon-cash item in the accompanying statements of cash flows and a capitalcontribution in the statements of stockholders’ equity and other comprehensiveincome (loss), as this interest was not required to be paid to Merck KGaA.

**(2)   Summaryof Significant Accounting Policies**

The accounting policies asdescribed herein are applicable to both the predecessor and successor financialstatements unless specifically noted therein.

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

The accompanyingconsolidated financial statements include the accounts of VWR and itssubsidiaries after elimination of all intercompany balances and transactions.

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

Cash and cash equivalentsare comprised of highly liquid investments with insignificant interest raterisk and having original maturities of three months or less. The amount ofrestricted cash was $1.2 and $1.5 at December 31, 2005 and 2004, respectively.

***(c) Trade Accounts Receivables Reserve***

The carrying amount ofaccounts receivable reflects a reserve representing our best estimate of theamounts that will not be collected and for estimated sales returns andallowances. In addition to reviewing delinquent accounts receivable, weconsider many factors in estimating our reserve, including historical data,experience, customer types, credit worthiness, and economic trends. From timeto time, we may adjust our assumptions for anticipated changes in any of theseor other factors expected to affect collectibility.

46

----

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

***(d) Inventories***

Inventories are valued atthe lower of cost or market, cost being determined principally by the last-in,first-out (“LIFO”) method for our U.S. subsidiaries and the average cost or thefirst-in, first-out (“FIFO”) method for all other subsidiaries. The Companyperiodically reviews quantities of inventories on hand and compares theseamounts to the expected use of each product or product line. The Companyrecords a charge to cost of sales for the amount required to reduce thecarrying value of inventory to net realizable value. Costs associated with theprocurement and warehousing of inventories, such as inbound freight charges,purchasing and receiving costs, and internal transfer costs, are included inthe cost of sales line item within the statement of operations.

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

Property and equipment arerecorded at cost. Property and equipment held under capital leases are statedat the present value of minimum lease payments. Depreciation is computed usingthe straight-line method as follows: buildings and improvements, 10 to 40years; equipment and software, 3 to 10 years. Property and equipment held undercapital leases and leasehold improvements are amortized over the shorter of theremaining life of the lease or the useful lives of the improvements. Costs forrepairs and maintenance that do not significantly increase the value orestimated lives of property and equipment are treated as expense as such expensesare incurred.

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

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

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

Goodwill included in thefinancial statements primarily represents the excess of acquisition costs overthe fair value of net assets acquired in connection with the Acquisition asdiscussed in Note 5(a).

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

VWR evaluates therecoverability of long-lived assets used in operations when events orcircumstances indicate a possible inability to recover carrying amounts. Suchevaluations are based on undiscounted cash flow and profitability projections.An impairment charge is recorded for the difference between the fair value andcarrying value of the asset. No impairment losses were recorded in 2005, 2004or 2003.

47

----

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

***(h) Advertising***

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

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

 

***(i) Revenue Recognition***

VWR records revenue whenpersuasive evidence of an arrangement exists, the price is fixed ordeterminable, title and risk of loss have been transferred to the customer, andcollectibility of the resulting receivable is reasonably assured. Risk of lossis transferred at the time of shipment or upon delivery to customers, dependingupon the terms of the arrangement with the customer. Products are deliveredwithout significant post-sale obligations to the customer. Provisions fordiscounts, and rebates to customers, sales returns, and other adjustments areprovided for as a reduction of sales in the period the related sales arerecorded. Service revenue is recognized when the services are performed.

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

VWRrecords shipping and handling charges billed to customers in net sales andrecords shipping and handling costs in cost of goods sold for all periodspresented.

***(k) Income Taxes***

Income taxes are accountedfor under SFAS No. 109, *Accounting forIncome Taxes*, which requires the asset and liability method underwhich deferred income taxes are recognized for the expected net tax effects oftemporary differences between the carrying amounts of assets and liabilitiesfor financial reporting and income tax purposes. Deferred tax assets andliabilities are measured using the enacted tax rates expected to apply totaxable income in the years in which those temporary differences are expectedto be recovered or settled. The effect on deferred tax assets and liabilitiesof a change in tax rates is recognized in income in the period that includesthe enactment date. VWR records a valuation allowance to reduce deferred taxassets to the amount that is more likely than not to be realized. See Note 12for a discussion of the Company’s filing of a consolidated federal tax returnwith CDRV.

***(l) Insurance***

Certain insurable riskssuch as commercial general liability; property damage and business interruption;and workers’ compensation are insured by third parties. However, VWRself-insures certain 

48

----

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

componentsof these risk exposures at various deductible levels. Accruals for claims underVWR’s self-insurance programs are recorded on a claims-incurred basis.

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

VWRhas defined benefit plans covering certain of its employees. The benefitsinclude pension, salary continuance, severance, life insurance, and healthcare. Benefits are accrued over the employee’s service period.

***(n) Concentrations of Credit Risk***

Tradereceivables reflect a diverse customer base and our wide geographic dispersionof businesses. As a result, no significant concentrations of credit risk exist.

***(o) Stock-Based Compensation***

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

| ** **                                                                                                     | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** |
|----------------------------------------------------------------------------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                                                                                                     | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** |
| ** **                                                                                                     | ** ** | **2005**              | ** ** | **2004**               | ** ** |
| Net income as  reported                                                                                        |       |                  | $          | 41.3                   |       |   |   | $ | 31.9 |   |   |
| Add: stock-based  compensation expense in reported net income, net of tax                                      |       |                  | 0.5        |                   |       |   | — |   |   |
| Deduct:  stock-based compensation expense determined using fair value based method for  all awards, net of tax |       |                  | (1.4       | )                      |       |   | (0.3 | ) |   |
| Pro-forma net income                                                                                           |       |                  | $          | 40.4                   |       |   |   | $ | 31.6 |   |   |

 

49

----

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

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

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

 

***(p) Foreign Currency Translation***

Assetsand liabilities of VWR’s foreign subsidiaries, where the functional currency isthe local currency, are translated into U.S. dollars using period-endexchange rates, and income and expenses are translated using average exchangerates. Resulting translation adjustments are reported as a separate componentof stockholders’ equity. Foreign currency translation adjustments for exchangegains and losses on transactions are included in other (income) expense, net,and were as follows:

| ** **           | ** ** | **Successor**         | ** ** | **Predecessor**         | ** ** |
|----------------------|------------|-----------------------|------------|-------------------------|------------|
| ** **           | ** ** | **Year Ended**   | ** ** | **April 7 -** | ** ** | **January 1 -** | ** ** | **Year Ended** | ** ** |
| ** **           | ** ** | **December 31,** | ** ** | **December 31,**   | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **           | ** ** | **2005**              | ** ** | **2004**                | ** ** | **2004** | ** ** | **2003** | ** ** |
| Exchange gains,  net |       |                  | $          | 2.9                     |       |   |   | $ | 1.1 |   |   |   | $ | 0.4 |   |   |   | $ | 0.1 |   |   |
|                      |            |                       |            |                         |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

Therehave been no significant fluctuations in foreign currency exchange rates since December 31,2005.

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

The Company accounts for derivative financialinstruments in accordance with SFAS No. 133, *Accounting for Derivative Instruments and Hedging Activities,*as amended. All derivatives, whether designated for hedging relationships ornot, are recorded on the balance sheet at fair value. If the derivative isdesignated as a fair value hedge, the changes in the fair value of thederivative and of the hedged item attributable to the hedged risk are recognizedin the results of operations. If the derivative is designated as a cash flowhedge, the effective portions of changes in the fair value of the derivativeare recorded in accumulated other comprehensive income and are recognized inthe results of operations when the hedged item affects earnings. Ineffectiveportions of changes in the fair value cash flow hedges are recognized in theresults of operations. For derivative instruments not designated as hedginginstruments, changes in fair value are recognized in the results of operationsin the current period.

VWR enters into foreign currency forward contractsprimarily to hedge exposures to fluctuations in foreign currency rates thatarise from purchasing of products that are denominated in foreign currencies.Gains and losses on the foreign currency forward contracts generally offsetgains and losses on certain expected commitments. To the extent these foreigncurrency forward contracts are considered effective 

50

----

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

hedges, gains and losseson these positions are deferred and included in the basis of the transactionwhen it is completed. Cash flows from foreign currency forward contractsaccounted for as hedges are classified in the statement of cash flows in thesame category as the item being hedged or on a basis consistent with the natureof the instrument.

TheCompany uses an interest rate cap agreement to manage its exposure to interestrate risk. This interest rate cap is designated as a cash flow hedge of theCompany’s variable rate debt. This agreement is for two years and matures July 2006.Amounts accumulated in other comprehensive income are reclassified intoearnings as interest is accrued on the hedge transactions. The amountsaccumulated in other comprehensive income will fluctuate based on changes in thefair value of the Company’s derivatives at each reporting period.

***(r) Investments***

VWRaccounts for its 24% investment in a business using the equity method ofaccounting.

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

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

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

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

 

***(t) Reclassifications***

Certain amounts from priorperiods have been reclassified to conform to the current presentation.

***(u) Use of Estimates***

The preparation offinancial statements in conformity with accounting principles generallyaccepted in the United States of America requires management to make estimatesand assumptions that affect the reported amounts of assets and liabilities anddisclosure of contingent assets and liabilities at the date of the financialstatements and the reported amounts of revenues and expenses during thereporting period. While actual results could differ from those estimates,management believes that the estimates are reasonable.

51

----

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

***(v) New AccountingStandards***

During December 2004,the Financial Accounting Standards Board (“FASB”) issued SFAS No. 123Revised, *Share-Based Payment*(“SFAS No. 123R”). This Statement requires companies to recognize in theincome statement, the grant date value of stock options and other forms ofequity-based compensation issued to employees. The provisions of this Statementbecome effective at the beginning of 2006. During August 2004, CDRV, ourultimate parent, introduced a share-based compensation arrangement as acomponent of its compensation plans for our employees. EffectiveJanuary 1, 2006 we are no longer permitted to follow the intrinsic valueaccounting method of APB No. 25, and SFAS No. 123R will apply to allof CDRV’s outstanding unvested options as of January 1, 2006 and allprospective awards using the modified prospective transition method withoutrestatement of prior periods. The impact this Statement will have on theCompany’s results of operations will be substantially consistent with the pro-formaamounts shown in Note 2(o).

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

**(3)   Changein Accounting Principle**

SFAS No. 143, *Accounting for Asset Retirement Obligations*(“SFAS No. 143”) addresses financial accounting and reporting forobligations associated with the retirement of tangible long-lived assets andthe associated asset retirement costs. SFAS No. 143 requires recognitionof a liability at fair value and an increase to the carrying value of therelated asset for any retirement obligation. This amount is depreciated overthe life of the asset. The liability is adjusted to reflect the passage of timeand changes in the estimated future cash flows. SFAS No. 143 was effectivefor the Company as of January 1, 2003.

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

52

----

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

***(a) Effect ofAdopting FIN 47***

Weadopted FIN 47 effective December 31, 2005. Our conditional assetretirement obligations primarily relate to restoration costs for leasedfacilities including the removal of certain leasehold improvements. As a resultof the adoption of FIN 47, we recorded the following amounts in our financialstatements as of and for the year ended December 31, 2005:

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

 

The cumulative effect ofthe adoption of FIN 47 of $0.5 reflects charges since the Acquisition. Assetretirement obligations have been adjusted to reflect the cumulative accretionof all related liabilities to December 31, 2005.

On a pro-forma basis, theliabilities for asset retirement obligations if FIN 47 had been adopted on January 1,2003 would have been as follows: January 1, 2003 - $1.7, December 31,2003 - $1.9 and December 31, 2004 - $2.2. These pro-forma amounts areestimated based upon the information, assumptions and interest rates used tomeasure the liabilities for asset retirement obligations recognized uponadoption of FIN 47 as of December 31, 2005. Had we adopted FIN 47 at thebeginning of 2003, the pro-forma consolidated statements of operations wouldnot have been materially different from the amounts reported.

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

The liabilities for assetretirement obligations will be adjusted on an ongoing basis due to the passageof time, new laws and regulations and revisions to either the timing or amountof the original estimates. These liabilities will be accreted to their fullestimated settlement amounts through the estimated ultimate settlement dates ofthe underlying obligations. This accretion charge will be reflected as acomponent of selling, general and administrative expense in our consolidatedstatement of operations. Net asset retirement costs will be depreciated overthe remaining lease terms or lives of the related assets. This charge will berecorded as depreciation expense in our consolidated statement of operations.

**(4)   Restructuring**

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

Subsequent to theAcquisition, we initiated restructuring activities designed to reduce operatingcosts and improve the operating and administrative capabilities of the Company.The initial focus was on the Company’s European operations and organizationalstructure and, to a lesser extent, the operations in 

53

----

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

NorthAmerica. In connection with this initial focus, we recorded restructuringaccruals of $29.7 in 2004. These charges primarily related to reductions inheadcount in Europe due to the reorganization of the Company’s European salesand marketing functions.

In early 2005, weimplemented various restructuring plans that were formulated in 2004 and werein the planning and evaluation stages. Accordingly, we recorded additionalrestructuring accruals of approximately $24.5 in the first half of 2005. Thesecharges primarily reflect severance and other exit costs including estimatesfor environmental remediation associated with cessation of manufacturingoperations at a plant in France and severance costs associated with theconsolidation of certain sales and marketing personnel in our German and UKoperations.

These charges have beenrecorded as adjustments to acquisition costs (increases to goodwill) pursuantto the provisions of Emerging Issues Task Force Issue No. 95-3, *Recognition of Liabilities in Connection with aPurchase Business Combination* (“EITF 95-3”).

The charge forenvironmental remediation in France was initially estimated at $6.4 based on apreliminary study conducted by an environmental engineering firm. We haveupdated these estimates in coordination with the environmental engineering firmand have determined that our estimate for remediation costs should be $3.9.Accordingly, we have reduced the reserve and goodwill by $2.5 at December 31,2005. In addition, we have also reduced our severance accruals, primarily inFrance and the UK, by $1.7 with a corresponding reduction to goodwill.

Thefollowing table sets forth the activity associated with the Company’sliabilities for restructuring as a result of the Acquisition.

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

 

54

----

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

 

***(b) Otherrestructuring activities***

In addition, we initiatedseveral cost reduction programs in response to relatively static marketconditions and implemented reductions in force and other cost containmentmeasures during 2005. In connection with these actions, we recorded accrualsrelated to severance and facility exit costs totaling $20.6 and incurredapproximately $2.1 for duplicate expenditures incurred in our UK operationsrelated to the transition and consolidation of certain administrativefunctions. These duplicate expenditures are included in selling, general andadministrative expenses in the accompanying statement of operations.

Thefollowing table sets forth the activity associated with the Company’sliabilities for these cost reduction programs.

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

 

At December 31,2005, $16.6 of our aggregate restructuring liabilities are included in accruedexpenses and $6.7 are included in other long-term liabilities. At December 31,2004, our aggregate restructuring liabilities of $21.8 were included in accruedexpenses.

**(5)   BusinessCombinations and Acquisitions**

***(a) Acquisition ofVWR International Corporation by CDRVA***

On February 15, 2004,Merck KGaA and CDRVA entered into a Stock Purchase Agreement, which wasconsummated on April 7, 2004. The Acquisition was accounted for under thepurchase method of accounting in accordance with SFAS No. 141, *Business Combinations.*Under purchase accounting, tangibleand identifiable intangible assets acquired and liabilities assumed have beenrecorded at their respective fair values based on third party valuations. Thepurchase accounting adjustments made in the accompanying financial statementsas of and for the year ended December 31, 2004 were preliminary andfinalized during 2005.

55

----

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

Theexcess investment made by CDRVA over the estimates of the fair market value ofthe identifiable assets and liabilities of the Company as of April 7, 2004was approximately $859.6 and is summarized below.

| Purchase price                |   | $      | 1,669.1 |   |
|-------------------------------|--------|--------|---------|--------|
| Estimated  transaction costs  |   | 20.5   |    |
| Net tangible  assets acquired |   | (268.0 | )       |
| Intangible assets  acquired   |   | (562.0 | )       |
| Goodwill                      |   | $      | 859.6   |   |

 

Thefollowing unaudited pro-forma financial information presents a summary ofconsolidated results of operations of the Company for the periods presented asif the Acquisition had occurred as of January 1, 2003.

| ** **                  | ** ** | **Year Ended  December 31,** | ** ** |
|-----------------------------|------------|----------------------------------------|------------|
| ** **                  | ** ** | **2004**                               | ** ** | **2003** | ** ** |
| Net sales                   |       | $                                      | 3,005.4    |   | $ | 2,794.2 |   |
| Income before  income taxes |       | 76.9                                   |       | 60.2 |   |
| Net income                  |       | 44.0                                   |       | 34.4 |   |
|                             |            |                                        |            |  |  |  |  |

 

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

***(b) Successor’sAcquisitions of AGB Scientific Ltd., Advanced Instruments Sales &Services, Inc., Technical Service Lab B.V., and Science Education Business***

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

On April 1, 2005, theCompany acquired Advanced Instruments Sales & Services, Inc. (“AI”)for cash consideration of approximately $16.8 and CDRV stock of approximately$0.5. AI performs services and distributes scientific supplies to the PuertoRican market and is headquartered in San Juan, Puerto Rico. The results of AIhave been included in the North American Lab segment from the date ofacquisition.

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

56

----

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

The excessinvestment made by the Company over the estimates of the fair market value ofthe identifiable assets and liabilities for the three acquisitions discussedabove and one other minor acquisition was $23.3 and is summarized below.

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

 

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

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

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

***(c) Predecessor’sAcquisition of VWRSP in 1995 and 1999***

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

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

Interest expense wasrecorded on pushdown debt based upon Merck KGaA’s intercompany interest rates,which were not necessarily indicative of rates VWR would have obtained if itwere not an ultimate subsidiary of Merck KGaA. Interest expense, including tax effects,on pushdown debt, has been included in the statements of operations andpresented as a non-cash item in the accompanying statements of cash flows and acapital contribution in the statement of stockholders’ equity, as this interestwas not required to be paid to Merck KGaA.

57

----

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

***(d)  Goodwill andOther Intangible Assets***

***The following table provides a summary ofgoodwill established as of the Acquisition and a roll forward of goodwill to December 31,2005 as reflected in the accompanying consolidated balance sheets.***

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

 

----

(1)          Duringthe first quarter of 2005, the Company finalized its plans with regard to thecurtailment of certain U.S. benefit plans. In accordance with EITF 95-3,the curtailment gains of $12.1, net of tax, were recorded as reductions togoodwill. See Note 13 for further information.

(2)          Other adjustments, netinclude the favorable resolution of certain pre-Acquisition tax contingenciesof $3.6 and a charge of $4.5 that represents an adjustment to deferred  taxes originally established in NorthAmerican Lab; reductions to restructuring liabilities for environmentalremediation and severances (See Note 4(a)) of $4.2 as well as a reduction toretirement benefit liabilities of $0.6 in European Lab; and other minoradjustments to purchase price allocation.

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

58

----

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

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

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

 

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

| ** **            | ** ** | **Successor**                                | ** ** | **Predecessor**                                       | ** ** |
|-----------------------|------------|----------------------------------------------|------------|-------------------------------------------------------|------------|
| ** **            | ** ** | **Year Ended  December 31,  2005** | ** ** | **April 7 –  December 31,  2004** | ** ** | **January 1 –  April 6,  2004** | ** ** | **Year Ended  December 31,**

**2003** | ** ** |
| Amortization  expense |       |                                         | $          | 14.8                                                  |       |   |   | $ | 10.6 |   |   |   | $ | 0.4 |   |   |   | $ | 1.0 |   |   |
|                       |            |                                              |            |                                                       |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

The estimatedamortization expense for each of the five succeeding years and thereafter is asfollows:

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

 

59

----

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

 

**(6) Investments**

VWR has a 24% equityinvestment in an independent distribution company. The carrying amount of VWR’s24% investment (accounted for under the equity method) was $7.4 and $8.3 as of December 31,2005 and December 31, 2004, respectively. Equity income, included in other(income) expense, net for each of the reporting periods is shown in the tablebelow:

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

 

The Company believes thatits equity investment does not qualify as a variable interest entity, asdefined in December 2003 by the FASB with its issuance of revisedInterpretation No. 46, *Consolidation ofVariable Interest Entities.*

**(7) FairValue of Financial Instruments**

VWR’s financial instruments consist primarily of cashand cash equivalents held at financial institutions, accounts receivables,accounts payable, short- and long-term debt, foreign currency forward contractsand an interest rate cap.

The carrying amounts for cash and cash equivalents,accounts receivables, accounts payable and short-term debt approximate fairvalue due to the short-term nature of these instruments.

Thetable below shows the carrying amounts and estimated fair values of our fixedrate long-term note debt instruments. The fair values of these instruments wereestimated based on quotes from a bond trader making a market in these debtinstruments.

| ** **                                    | ** ** | **December 31, 2005** | ** ** | **December 31, 2004** | ** ** |
|-----------------------------------------------|------------|---------------------------------|------------|---------------------------------|------------|
| ** **                                    | ** ** | **Carrying  Amount**            | ** ** | **Fair Value**             | ** ** | **Carrying  Amount** | ** ** | **Fair Value** | ** ** |
| Unsecured Senior  Notes—67¤8%       |       |                            | $          | 200.0                           |       |   |   | $ | 198.5 |   |   |   | $ | 200.0 |   |   |   | $ | 209.0 |   |   |
| Unsecured Senior  Subordinated  Notes—8% |       |                            | 320.0      |                            |       |   | 318.4 |   |   |   | 320.0 |   |   |   | 328.0 |   |   |
|                                          |       |                            | $          | 520.0                           |       |   |   | $ | 516.9 |   |   |   | $ | 520.0 |   |   |   | $ | 537.0 |   |   |

 

60

----

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

Thetables below show our outstanding foreign currency forward contracts, fairvalue of the outstanding contracts and pre-tax loss from settled contractsincluded in cost of goods sold for each of the reporting periods. The fairvalue of the foreign currency forward contracts was estimated based onperiod-end spot rates.

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

 

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

 

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

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

**(8) Inventories**

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

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

 

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

61

----

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

**(9) Property and Equipment**

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

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

 

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

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

 

**(10) Accrued Expenses**

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

| ** **                              | ** ** | **December 31,** | ** ** |
|-----------------------------------------|------------|-----------------------|------------|
| ** **                              | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Other accrued  expenses                 |       | $                     | 46.2       |   | $ | 41.8 |   |
| Employee-related  accruals              |       | 33.3                  |       | 48.0 |   |
| Restructuring-related  accruals         |       | 16.6                  |       | 21.8 |   |
| Income taxes  payable                   |       | 16.0                  |       | 11.5 |   |
| Accrued interest                        |       | 14.9                  |       | 13.5 |   |
| Current portion  of pension liabilities |       | 10.1                  |       | — |   |
| Deferred income taxes                   |       | 6.3                   |       | 13.8 |   |
|                                    |       | $                     | 143.4      |   | $ | 150.4 |   |

 

62

----

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

**(11) Debt**

Thefollowing is a summary of our debt obligations:

| ** **                                       | ** ** | **December 31,** | ** ** |
|--------------------------------------------------|------------|-----------------------|------------|
| ** **                                       | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Senior Secured  Credit Facility                  |       | $                     | 537.1      |   | $ | 559.5 |   |
| 67¤8%  Unsecured Senior Notes due 2012      |       | 200.0                 |       | 200.0 |   |
| 8% Unsecured  Senior Subordinated Notes due 2014 |       | 320.0                 |       | 320.0 |   |
| Loan from CDRV  Holdings, Inc.              |       | 0.6                   |       | 0.7 |   |
| Bank loans                                       |       | 0.3                   |       | 11.9 |   |
| Capital leases                                   |       | 5.8                   |       | 7.1 |   |
| Total debt                                       |       | 1,063.8               |       | 1,099.2 |   |
| Less short-term  portion                         |       | (45.5                 | )          | (12.9 | ) |
| Total long  term-portion                         |       | $                     | 1,018.3    |   | $ | 1,086.3 |   |

 

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

| ** **                                       | ** ** | **2006** | ** ** | **2007** | ** ** | **2008** | ** ** | **2009** | ** ** | **2010** | ** ** | **Thereafter** | ** ** | **Total** | ** ** |
|--------------------------------------------------|------------|----------|------------|----------|------------|----------|------------|----------|------------|----------|------------|----------------|------------|-----------|------------|
| Senior Secured  Credit Facility                  |       | $        | 44.4       |     | $          | 5.0      |       | $        | 5.0        |     | $          | 5.0            |       | $         | 241.8      |   |   | $ | 235.9 |   |   | $ | 537.1 |   |
| 67¤8%  Unsecured Senior Notes due 2012      |       | —   |       | —   |       | —   |       | —   |       | —   |       |           | 200.0      |      |       | 200.0 |   |
| 8% Unsecured  Senior Subordinated Notes due 2014 |       | —   |       | —   |       | —   |       | —   |       | —   |       |           | 320.0      |      |       | 320.0 |   |
| Loan from CDRV  Holdings, Inc.              |       | —   |       | —   |       | —   |       | —   |       | —   |       |           | 0.6        |      |       | 0.6 |   |
| Bank loans                                       |       | 0.3      |       | —   |       | —   |       | —   |       | —   |       |           | —     |      |       | 0.3 |   |
| Capital leases                                   |       | 0.8      |       | 0.8      |       | 0.6      |       | 0.7      |       | 0.6      |       |           | 2.3        |      |       | 5.8 |   |
| Total                                            |       | $        | 45.5       |     | $          | 5.8      |       | $        | 5.6        |     | $          | 5.7            |       | $         | 242.4      |   |   | $ | 758.8 |   |   | $ | 1,063.8 |   |

 

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

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

The term loan facilitieswill mature in 2011 and the multi-currency revolving credit facility willmature in 2009. The principal amount of the term loans are amortized in annualinstallments for the first six years 

63

----

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

andquarterly installments during the seventh year, subject to adjustment if theCompany makes optional or mandatory prepayments on the term loans.

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

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

·       50% of excess cash flow (asdefined) for any fiscal year unless certain leverage ratio targets are met. Apayment of $44.4 is due in March 2006 based on excess cash flow (asdefined) generated in 2005. This amount has been included in short-term bankdebt in our consolidated balance sheet at December 31, 2005.

***Security; Guarantees***

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

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

***Interest***

At our election, theinterest rates applicable to the U.S. dollar-denominated term loan can be basedon a fluctuating rate of interest measured by reference to either (1) anadjusted London inter-bank offered rate, or LIBOR, plus a borrowing margin or (2) analternate base rate, or ABR, plus a borrowing margin. The interest rateapplicable to the Euro-denominated term loan is based on a fluctuating rate ofinterest measured by reference to an adjusted EURIBOR plus a borrowing margin.As of December 31, 2005, the interest rates on the U.S. dollar-denominatedand Euro-denominated term loans were 6.69% and 4.94%, respectively.

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

64

----

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

***Covenants***

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

***(b) TheSenior and Senior Subordinated Notes***

The 67¤8 % UnsecuredSenior Notes mature on April 15, 2012. The 8% Unsecured SeniorSubordinated Notes mature on April 15, 2014. Both the senior and seniorsubordinated notes require semiannual cash interest payments on April 15and October 15 to holders of record at the close of business as of thepreceding April 1 and October 1. The senior subordinated notes aresubordinated in right of payment to all secured debt of the Company and the seniornotes.

Under the Senior Indenture and the Senior SubordinatedIndenture, additional securities may be issued in one or more series from timeto time, subject to certain covenant limitations.

***(c)***                  BankLoans

Bank loans consist of amounts owed by certain Europeansubsidiaries that are operating with and without formal agreements with foreignbanks to fund short-term needs. The bank loans had an average interest rate of5.4% and 2.8% as of December 31, 2005 and December 31, 2004,respectively. This debt was assumed in connection with the Acquisition. VWR hadno financial covenants related to bank loans as of December 31, 2005.

*** (d)***              Intereston Push Down Debt

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

***(e)***                  Intereston Loans from Merck KGaA and Affiliates

Prior to the Acquisition,VWR had various loans with Merck KGaA and its affiliates. Interest expense andaverage interest rate on these loans was $1.4 and 2.6% for the period January 1,2004 to April 6, 2004 and $8.3 and 2.8% for the year ended December 31,2003. This debt was extinguished in connection with the Acquisition.

65

----

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

**(12)   Income Taxes**

Taxes on incomebefore cumulative effect of a change in accounting principle are based onincome before income taxes as follows:

| ** **    | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|---------------|------------|-----------------------|------------|------------------------------|------------|
| ** **    | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **    | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31** | ** ** |
| ** **    | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| United States |       |                  | $          | 32.2                         |       |   |   | $ | 26.7 |   |   |   | $ | 20.0 |   |   |   | $ | 65.4 |   |   |
| Foreign       |       |                  | 40.6       |                         |       |   | 28.7 |   |   |   | 15.8 |   |   |   | 45.9 |   |   |
| Total         |       |                  | $          | 72.8                         |       |   |   | $ | 55.4 |   |   |   | $ | 35.8 |   |   |   | $ | 111.3 |   |   |

The provision for incometaxes is as follows:

| ** **                              | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|-----------------------------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **                              | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **                              | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                              | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Current:                                |       |                  |       |                         |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                                 |       |                  | $          | 4.5                          |       |   |   | $ | 4.6 |   |   |   | $ | 10.1 |   |   |   | $ | 18.3 |   |   |   |
| State                                   |       |                  | 0.5        |                         |       |   | 1.6 |   |   |   | 0.5 |   |   |   | 2.5 |   |   |   |
| Foreign                                 |       |                  | 21.2       |                         |       |   | 14.3 |   |   |   | 5.2 |   |   |   | 17.5 |   |   |   |
|                                    |       |                  | 26.2       |                         |       |   | 20.5 |   |   |   | 15.8 |   |   |   | 38.3 |   |   |   |
| Deferred:                               |       |                  |       |                         |       |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Federal                                 |       |                  | 10.5       |                         |       |   | 4.5 |   |   |   | 0.3 |   |   |   | 8.1 |   |   |   |
| State                                   |       |                  | 2.6        |                         |       |   | 0.2 |   |   |   | — |   |   |   | 2.9 |   |   |   |
| Foreign                                 |       |                  | (8.3       | )                            |       |   | (1.7 | ) |   |   | 0.6 |   |   |   | 3.0 |   |   |   |
|                                    |       |                  | 4.8        |                         |       |   | 3.0 |   |   |   | 0.9 |   |   |   | 14.0 |   |   |   |
| Tax benefit on  push down debt interest |       |                  | —     |                         |       |   | — |   |   |   | (1.6 | ) |   |   | (6.1 | ) |   |   |
| Total tax  provision                    |       |                  | $          | 31.0                         |       |   |   | $ | 23.5 |   |   |   | $ | 15.1 |   |   |   | $ | 46.2 |   |   |   |

 

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

The reconciliation of tax computed at the U.S. federalstatutory tax rate of 35% on income before income taxes and cumulative effectof a change in accounting principle to the actual income tax provision is asfollows:

66

----

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

 

| ** **                                     | ** ** | **Successor**         | ** ** | **Predecessor**              | ** ** |
|------------------------------------------------|------------|-----------------------|------------|------------------------------|------------|
| ** **                                     | ** ** | **Year Ended**   | ** ** | **April 7 –** | ** ** | **January 1 –** | ** ** | **Year Ended** | ** ** |
| ** **                                     | ** ** | **December 31,** | ** ** | **December 31,**        | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                     | ** ** | **2005**              | ** ** | **2004**                     | ** ** | **2004** | ** ** | **2003** | ** ** |
| Statutory tax  expense                         |       |                  | $          | 25.5                         |       |   |   | $ | 19.4 |   |   |   | $ | 12.6 |   |   |   | $ | 39.0 |   |   |   |
| State income  taxes net of federal tax benefit |       |                  | 2.0        |                         |       |   | 1.1 |   |   |   | 0.1 |   |   |   | 2.7 |   |   |   |
| Foreign rate  differential                     |       |                  | (0.8       | )                            |       |   | (1.9 | ) |   |   | — |   |   |   | (1.5 | ) |   |   |
| Nondeductible  expenses                        |       |                  | 1.0        |                         |       |   | 2.2 |   |   |   | 0.4 |   |   |   | 1.6 |   |   |   |
| Change in  valuation allowance                 |       |                  | 2.7        |                         |       |   | 2.8 |   |   |   | 2.2 |   |   |   | 3.1 |   |   |   |
| Other, net                                     |       |                  | 0.6        |                         |       |   | (0.1 | ) |   |   | (0.2 | ) |   |   | 1.3 |   |   |   |
| Total tax  provision                           |       |                  | $          | 31.0                         |       |   |   | $ | 23.5 |   |   |   | $ | 15.1 |   |   |   | $ | 46.2 |   |   |   |

 

Deferred tax liabilities and assets are comprised ofthe following:

| ** **                         | ** ** | **December 31,** | ** ** |
|------------------------------------|------------|-----------------------|------------|
| ** **                         | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Deferred tax  liabilities:         |       |                  |       |   |   |
| Depreciation                       |       | $                     | 14.1       |   | $ | 13.2 |   |
| Goodwill amortization              |       | 20.8                  |       | 6.0 |   |
| Intangibles                        |       | 207.3                 |       | 217.5 |   |
| Inventory valuation                |       | 18.6                  |       | 13.6 |   |
| Tax-exempt reserves                |       | —                |       | 2.9 |   |
| Total deferred tax liabilities     |       | 260.8                 |       | 253.2 |   |
| Deferred tax assets:               |       |                  |       |   |   |
| Pensions                           |       | 25.0                  |       | 26.6 |   |
| Other compensation benefits        |       | 5.1                   |       | 5.0 |   |
| Net operating loss carryforwards   |       | 22.2                  |       | 16.0 |   |
| Foreign tax credit carryforwards   |       | 3.3                   |       | 3.5 |   |
| Inventory overhead capitalization  |       | 3.0                   |       | 1.5 |   |
| Accrued expenses                   |       | 5.5                   |       | 7.9 |   |
| Receivables                        |       | 1.9                   |       | 1.9 |   |
| Other, net                         |       | 0.5                   |       | 0.8 |   |
|                               |       | 66.5                  |       | 63.2 |   |
| Valuation allowances               |       | (21.8                 | )          | (21.6 | ) |
| Total deferred  tax assets, net of |       |                  |       |   |   |
| valuation allowances               |       | 44.7                  |       | 41.6 |   |
| Net deferred tax  liabilities      |       | $                     | 216.1      |   | $ | 211.6 |   |

 

67

----

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

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

| ** **                                                          | ** ** | **December 31,** | ** ** |
|---------------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                          | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Deferred tax  asset—current (incuded in other current assets)  |       | $                     | (18.1      | ) | $ | (8.9 | ) |
| Deferred tax  asset—noncurrent                                 |       | (5.6                  | )          | (34.4 | ) |
| Deferred tax  liability—current (included in accrued expenses) |       | 6.3                   |       | 13.8 |   |
| Deferred tax  liability—noncurrent                             |       | 233.5                 |       | 241.1 |   |
| Net deferred tax  liability                                         |       | $                     | 216.1      |   | $ | 211.6 |   |

 

VWR evaluates therealizability of deferred tax assets taking into consideration such factors asthe future reversals of existing taxable temporary differences, projectedfuture operating results, the available carryforward period, and othercircumstances. Valuation allowances have been recorded for deferred tax assetsrelated to foreign net operating loss carryforwards, foreign tax creditcarryforwards and other deferred tax assets that are not expected to berealized. As of December 31, 2005, the Company had valuation allowances of$13.9 related to pre-Acquisition foreign operating losses and tax creditcarryforwards. Should such losses ultimately be recovered, the resultant reductionin the valuation allowance will be recorded as a reduction to goodwill. Withrespect to the remaining deferred tax assets, management believes it is morelikely than not that VWR will realize the benefits of these deductibledifferences, net of the existing valuation allowances.

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

As of December 31, 2005, VWR has U.S. state netoperating loss carryforwards of approximately $18.0 that expire at varioustimes through 2025. In addition, VWR has foreign net operating losscarryforwards of approximately $64.0, $7.0 that begin to expire in 2013 andanother $57.0 that have indefinite expirations. As of December 31, 2005,foreign tax credit carryforwards of $3.3 will expire at various times through2015.

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

The Company participatesin the filing of consolidated federal and certain state combined income taxreturns with our ultimate parent, CDRV. Based on provisions of the Company’stax sharing agreement and our bank credit agreement, the Company remits to CDRVthe lower of the current tax liability of the Company or the current tax liabilityas reflected on the CDRV consolidated or combined federal or state tax returns.As of December 31, 2005, the Company has accrued income taxes payable of$4.5 due to CDRV under the tax sharing arrangement. No payments were madeduring 2005 and the Company expects no payments will be made in 2006.

68

----

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

**(13) Benefit Programs**

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

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

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

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

69

----

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

VWRuses a December 31 measurement date for the plan. The change in benefitobligation, change in plan assets, and reconciliation of funded status of VWR’sdefined benefit plan that previously covered substantially all of its U.S.employees, except for employees covered by independently operated collectivebargaining plans, were as follows:

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

 

Amountsrecognized in the consolidated balance sheet were as follows:

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

 

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

70

----

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

Netperiodic pension cost includes the following components:

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

 

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

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

 

Thenet periodic pension cost and the projected benefit obligation were based onthe following assumptions:

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

 

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

71

----

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

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

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

 

The principal investmentobjective is to obtain the highest return (defined as income plus realized andunrealized capital gains and losses) consistent with the long-term security ofanticipated benefit payments. This is to be achieved by (a) investing asubstantial portion of fund assets in equity investments; (b) investmentcosts and volatility will be limited by investing the fund’s core assets inpassive or commingled funds that participate in a range of widely diversifiedequity and non-equity investments; (c) active managers will control nomore than a third of the fund’s assets; (d) in order to increase thestability of fund performance while maintaining expected returns, non-callablebonds, annuities or guaranteed insurance contracts may be purchased to coverpayments to retired participants whenever the rate of return offered by suchcontracts significantly exceeds the average returns projected for other fundassets and (e) fund contributions will be set to meet an asset fundingtarget of 125% of the present value of accumulated pension benefits. Theexpected rate of return on plan assets was based on our historical returns.

The Company expects tomake contributions to the plan of approximately $8.5 in 2006.

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

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

 

72

----

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

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

VWRalso sponsors defined contribution plans and a supplemental pension plan forcertain senior officers. In addition, certain employees are covered underunion-sponsored, collectively bargained plans. Expenses under theseunion-sponsored plans are determined in accordance with negotiated laborcontracts. Expenses incurred under these plan were as follows:

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

 

VWRprovides health benefits to certain retirees and a limited number of activeemployees and their spouses. These benefit plans are unfunded. Shown below arethe accumulated postretirement benefit obligation and the weighted averagediscount rate used in determining the accumulated postretirement benefitobligation. The annual cost of these plans is not material.

| ** **                                                                          | ** ** | **December 31,** | ** ** |
|-------------------------------------------------------------------------------------|------------|-----------------------|------------|
| ** **                                                                          | ** ** | **2005**              | ** ** | **2004** | ** ** |
| Postretirement benefit  obligations                                                 |       | $                     | 2.8        |   | $ | 2.6 |   |
| Weighted average  discount rate                                                     |       | 5.65                  | %          | 5.90 | % |
| Health care cost trend  rate assumed for next year                                  |       | 11.00                 | %          | 11.50 | % |
| Rate to which the cost  trend rate is assumed to decline  (the ultimate trend rate) |       | 5.00                  | %          | 5.00 | % |
| Year that the rate reaches the ultimate trend rate                                  |       | 2013                  |       | 2013 |   |
|                                                                                     |            |                       |            |  |  |  |  |

 

Assumed health care costtrend rates have a significant effect on the amounts reported for health careplans. A one-percentage-point change in assumed health care cost trend rateswould change our postretirement benefit obligation as of December 31, 2005by approximately $0.5.

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

VWR has defined benefitpension plans at various foreign subsidiaries. Our significant Non-U.S. definedbenefit plans are in Germany, the UK and France.

Our German subsidiary hasan unfunded defined benefit pension plan for current employees and retirees.Prior to the Acquisition, our UK subsidiary had employees that participated inMerck KGaA sponsored defined benefit pension plans, which were treated asmultiemployer plans. VWR’s contributions to these multiemployer plans were $0.2for the period January 1, 2004 to April 6, 2004 and $1.9 for the yearended December 31, 2003. In connection with the Acquisition, Merck KGaAagreed to deliver fully funded plans to VWR if VWR withdrew from Merck KGaAsponsored defined benefit pension plans. Effective April 7, 2004, VWRwithdrew from the Merck KGaA sponsored plans and our UK subsidiary establishedtwo defined benefit plans to provide for the benefits previously covered underthe Merck KGaA sponsored defined benefit plans. Our French subsidiary has adefined benefit pension plan for a certain group of employees that is closed tonew participants.

73

----

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

Inaddition, VWR has several small defined benefit pension plans at otherlocations. VWR uses a December 31 measurement date for these plans.Combined information for the German, French and the UK plans’ change in benefitobligation, change in plan assets, and reconciliation of funded status were asfollows:

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

 

Amountsrecognized in the consolidated balance sheet were as follows:

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

 

74

----

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

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

Combinednet periodic pension cost includes the following components:

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

 

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

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

 

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

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

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

 

75

----

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

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

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

 

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

Certain of VWR’s European subsidiaries provide postemployment benefits in the form of lump-sum cash payments to employees whenthey leave VWR, regardless of their reason for leaving. VWR estimates andaccrues a liability for these benefits. The largest such plans are in Franceand Italy. The combined liability recorded for these plans was $1.6 and $2.0 atDecember 31, 2005 and 2004, respectively.

**(14)   StockIncentive Plan**

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

Sharespurchased by our officers and employees under the Stock Plan may, at CDRV’sdiscretion, be repurchased by CDRV and/or CD&R Fund VI for their fairmarket value upon a participant’s termination of employment prior to a publicoffering. All participants may also be required to sell their shares at thesame price and on the same terms as CD&R Fund VI, if CD&R Fund VIenters into certain transactions with a third-party purchaser at any time beforethere is a public market for the shares of CDRV.

Forperiods prior to January 1, 2006, the Company has accounted for any stockoptions or awards granted to the Company’s employees under the Stock Plan inthe Company’s financial statements in accordance with AICPA AccountingInterpretation 1, *Stock Plans Established bya Principal Shareholder,*of APB No. 25. Accordingly, theCompany has accounted for awards under the Stock Plan using the intrinsic valueguidance in APB No. 25. Refer to Note 2(o) for disclosure of thepro-forma effect on net income for stock-based awards as if the Company hadadopted the fair value recognition provisions of SFAS No. 123. Also, referto Note 2(v) for further information concerning the Company’s accountingfor stock options after December 31, 2005.

76

----

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

***Initial Offering in 2004***

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

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

As of December 31,2004, CDRV had closed the initial offering in respect of 198 of our officersand employees, and 4 of our directors. In the initial offering, these officers,employees, and directors purchased a total of 239,835 shares and weregranted options to purchase 485,990 shares under the Stock Plan. Upon theclosing of the offering, the net proceeds of approximately $23.7 were paid toCDRV, who in turn contributed the $23.7 to the Company as an additionalinvestment. No additional shares were issued by the Company for this capitalcontribution. Because the option exercise price equaled the fair market valueper share of CDRV common stock at the time of grant, no compensation expenserelated to the stock options is reflected in the Company’s income statement. Inconnection with the December 16, 2004 offering of the Senior DiscountNotes by CDRV, the net proceeds of the offering were paid as a special dividendto CDRV stockholders and the original exercise price of $100.00 per share foreach option was adjusted to $50.52 per share pursuant to the antidilutionprovision of the Stock Plan. As a result of the special dividend distribution,the Company recorded compensation expense of approximately $1.2.

***Offerings in 2005***

During 2005, CDRV offered certain of our officers andemployees the opportunity to purchase shares of CDRV common stock for apurchase price equal to $56.00 per share, which we believe was the fair marketvalue of a share on the offer date. Those participants who are not alsoexecutive officers were offered financing assistance to help purchase theirshares through a loan facility that we arranged through a third-party financialinstitution. Consistent with the initial offering in 2004, participants weregranted options to purchase two additional shares of CDRV common stock for eachshare they purchased. The terms of these options are the same as the optionsgranted in 2004.

During 2005, CDRV closed offerings in respect of 18 ofour officers and employees, and 1 of our directors. These officers, employees,and director purchased a total of 23,407 shares and were granted 

77

----

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

options to purchase 45,920shares. Upon the closing of these offerings, the proceeds of approximately $1.3were paid to CDRV, who in turn contributed the $1.3 to the Company as anadditional investment. In connection with the acquisition of AI during 2005,discussed in Note 5(b), CDRV issued 8,929 shares, as consideration (for value of$0.5), and granted options to purchase 17,858 shares. Because the optionexercise price equaled the fair market value per share of CDRV common stock atthe time of grant, no compensation expense related to the stock options isreflected in the Company’s income statement.

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

We recognize compensation expense for the CDRV stockoptions granted to our employees, which are considered fixed awards withpro-rata vesting, on a straight-line basis.

Informationregarding CDRV stock options granted to our employees under the Stock Plan isas follows:

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

 

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

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

 

78

----

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

***Guaranteed Loans***

In connection with the loan facility we arrangedthrough a third-party financial institution, we have guaranteed an aggregateprincipal amount of $2.6 and $2.9 as of December 31, 2005 and 2004,respectively. The Company would become liable for such amounts in the eventthat a member of management would fail to repay the principal and interest whendue. These loans mature on November 5, 2008 and bear interest at the onemonth LIBOR plus 2.05%. In accordance with FASB Interpretation No. 45, *Guarantor’s**Accounting and Disclosure Requirements for Guarantees, IncludingIndirect Guarantees of Indebtedness of Others,* the Company hasdetermined that the obligation for the fair value of the guarantee isimmaterial. We recorded compensation expense and a corresponding increase inpaid-in-capital of $0.1, for the period April 7, 2004 to December 31,2004 for the favorable interest rate provided to individuals who have utilizedthe loan facility.

Given our guarantee of theloan balances, we have considered the proceeds received from the sale of theCDRV common stock to represent an obligation that may be redeemable upon theoccurrence of an event that is not within our control in accordance withAccounting Series Release No. 268 issued by the SEC. Therefore, tothe extent the loans guaranteed by the Company are outstanding, we havepresented the balance that may become due under the guarantee outside ofstockholders’ equity. As loans are repaid by the employees, the amountclassified outside of stockholders’ equity is reclassed to additional paid-incapital.

***Direct Loans***

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

***Capital Contributions***

Capitalcontributions for the reporting periods subsequent to the Acquisition consistof the following:

| ** **                                                       | ** ** | **Year Ended**   | ** ** | **April 7 -** | ** ** |
|------------------------------------------------------------------|------------|-----------------------|------------|-------------------------|------------|
| ** **                                                       | ** ** | **December 31,** | ** ** | **December 31,**   | ** ** |
| ** **                                                       | ** ** | **2005**              | ** ** | **2004**                | ** ** |
| Issuance of CDRV  common stock for cash, net of fees             |       |                  | $          | 1.3                     |       |   |   | $ | 20.6 |   |   |
| Issuance of CDRV  common stock in connection with AI acquisition |       |                  | 0.5        |                    |       |   | — |   |   |
| Issuance of CDRV  common stock for Board of Director service     |       |                  | 0.3        |                    |       |   | 0.1 |   |   |
| Equity  compensation expense related to CDRV common stock        |       |                  | 1.4        |                    |       |   | 0.8 |   |   |
|                                                             |       |                  | $          | 3.5                     |       |   |   | $ | 21.5 |   |   |

 

79

----

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

**(15)   Grants of Restricted Stock Units**

In 2004, CDRVgranted 5,000 CDRV restricted stock units to one of our executive officers thatwould have vested on the seventh anniversary of his commencement of employmentwith the Company. The restricted units would have vested earlier in certaincircumstances if the Company underwent a public offering or if we were sold toa third party unrelated to CD&R. The granting of these units has beenreflected in the December 31, 2004 financial statements by increasingadditional paid-in capital by $0.3 and a contra-equity account of unamortizedvalue of restricted stock issued of $0.3. The unearned compensation was beingamortized as compensation expense over the seven-year vesting period ofthe restricted units granted. As a result of this executive’s resignation in December 2005,the compensation expense previously recorded and the $0.3 increases toadditional paid-in capital and the contra-equity account of unamortized valueof restricted stock issued have been reversed in the December 31, 2005financial statements.

In 2005, CDRV granted21,333 CDRV restricted stock units with a total fair value of approximately$1.6 to certain of our officers and other key executives that will vest inequal annual installments over a five-year period. The restricted units willall vest earlier in certain circumstances if the Company undergoes a publicoffering or if we are sold to a third party unrelated to CD&R. The grantingof these units has been reflected in the December 31, 2005 financial statementsby increasing additional paid-in capital by $1.6 and a contra-equity account ofunamortized value of restricted stock issued of $1.6. The unearned compensationis being amortized as compensation expense over the five-year vestingperiod of the restricted units granted.

**(16)**   Commitments andContingencies

VWRleases office and warehouse space and computer equipment under operatingleases, certain of which extend up to 15 years, subject to renewal options.Rental expense is shown in the table below:

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

 

Futureminimum lease payments as of December 31, 2005, under noncancelableoperating leases having initial lease terms of more than one year are asfollows:

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

 

80

----

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

VWR is involved in variousenvironmental, contractual and product liability cases and claims which areconsidered routine to VWR’s business and from time to time VWR is named as adefendant in cases as a result of our distribution of scientific supplies,including litigation resulting from the distribution of products containingasbestos by VWR and certain of its predecessors. While the impact of thislitigation has typically been immaterial, there can be no assurance that theimpact of the pending and any future claims will not be material to ourbusiness, financial condition or results of operations in the future.

During 2005, the German Federal Cartel Officeinitiated an investigation with regard to our European Distribution Agreement withMerck KGaA. The purpose of the investigation is to determine whether thisagreement violates or otherwise infringes the general prohibition ofanti-competitive agreements under either German or EU rules. The Company hassubmitted information to the German Federal Cartel Office and is awaitingfeedback in connection with this matter. At the current time we cannot assessthe likely outcome of the investigation or potential economic impact associatedwith an adverse ruling. In connection with the Acquisition, we recordedintangible assets of approximately €24.8 million (or $29.4 ona U.S. dollar equivalent basis as of December 31, 2005) related to ourEuropean Distribution Agreement with Merck KGaA. As of December 31, 2005,the unamortized net book value of these intangible assets is approximately  €20.4 million (or $24.2 ona U.S. dollar equivalent basis).

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

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

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

***(a)   Sales toMerck KGaA***

VWR sells products toMerck KGaA for which it is paid in the normal course of business.

***(b)   Purchasesfrom Merck KGaA***

VWR purchases certainchemical products for resale from Merck KGaA for which it pays Merck KGaA inthe normal course of business. VWR and Merck KGaA have entered into twocontracts that provide for VWR to be the exclusive distributor of certain MerckKGaA products in certain countries (territories) and the non-exclusivedistributor in certain other territories. These two contracts for NorthAmerican and European territories expire on April 6, 2009 and may beextended for an additional five-year term subject to the occurrence of certainconditions.

81

----

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

In connection with theAcquisition, we have also entered into other distribution agreements with MerckKGaA, including five-year distribution agreements with Merck KGaA to distributeits bioscience products in Europe and North America. These distributionagreements in Europe and North America are exclusive and non-exclusive, respectively.In addition, we have entered into a supply agreement with Merck KGaA, pursuantto which it has agreed to continue to manufacture certain of our private labelproducts for a period of three years from April 7, 2004, and thereafter toprovide technical assistance in transitioning their manufacture to othermanufacturers. These products are primarily sold in the UK, and we have agreedto use our commercially reasonable efforts to convert these products to MerckKGaA-branded products to the extent that the conversion would be economicallyequivalent to us.

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

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

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

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

***(e) Other ServicesProvided by VWR and by Merck KGaA***

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

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

82

----

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

Thefollowing table summarized the transactions between VWR and Merck KGaA duringthe periods when VWR was a wholly-owned subsidiary of Merck KGaA:

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

 

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

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

***(f) Transactions with Clayton, Dubilier &Rice, Inc.***

Under the terms of aconsulting agreement between the Company and CD&R dated April 7, 2004the Company paid CD&R $18.0 for transaction services rendered in connectionwith the Acquisition. In addition, the consulting agreement includes an annualconsulting fee of $1.5 for financial advisory and management consultingservices and a provision that CD&R would be paid an additional fee of $0.5for any period CD&R provided the Company with an individual to be our ChiefExecutive Officer. In accordance with this provision we paid CD&R $0.3 in2005. The consulting agreement terminates upon the earlier of (1) April 7,2014; (2) the date on which an investment fund managed by CD&R nolonger owns, directly or indirectly, any shares of common stock of the Companyor its successor company; or (3) upon thirty days written notice of eitherparty.

***(g) Services performed by Debevoise &Plimpton LLP***

The Company is providedlegal services by the above referenced law firm in which one of the members ofthe Company’s Board of Directors is related to a senior member of that lawfirm. Total fees for services rendered during 2005 and 2004 were approximately$0.3 and $7.4, respectively.

***(h) Services performed by SIRVA, Inc.***

The Company is providedwith product transportation and relocation services by SIRVA, Inc. (“SIRVA”).Five members of the Company’s Board of Directors are also members of SIRVA’sBoard of Directors. SIRVA is a related party because certain funds managed byCD&R, including Clayton, Dubilier & Rice Fund VI LimitedPartnership that owns approximately 73% of CDRV’s outstanding 

83

----

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

commonstock as of December 31, 2005, have equity interests in SIRVA. Totalexpenses incurred with SIRVA during 2005 and 2004 were approximately $1.7 and$1.0, respectively.

**(18)   Accounts Payable**

VWR maintains acentralized cash management system for certain U.S. accounts payable functions.Accordingly, included in accounts payable at December 31, 2005 and 2004are approximately $48.9 and $33.9, respectively, of uncleared payments.

**(19)**   Segmentand Geographical Financial Information

VWR reports financial results on the basis of thefollowing three business segments: North American laboratory distribution, orNorth American Lab, European laboratory distribution, or European Lab, andScience Education. Both the North American Lab and European Lab segments arecomprised of the distribution of scientific supplies to customers engaged inpharmaceutical, biotechnology, chemicals, technology, and food processing;governmental agencies; colleges and universities; and environmentalorganizations. Science Education is comprised of the distribution of scientificsupplies and specialized kits to primary and secondary schools as well asdistribution of scientific supplies to universities and research institutes.

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

The Companyallocates its centralized management of corporate costs to its operatingsegments as follows:

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

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

84

----

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

Selectedbusiness segment financial information is presented below. Inter-segmentactivity has been eliminated. Therefore, revenues reported for each operatingsegment are substantially all from external customers.

| ** **                        | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|-----------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                        | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                        | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                        | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| **Net Sales**                     |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                |       |                  | $          | 1,902.4                |       |   |   | $ | 1,350.7 |   |   |   | $ | 486.5 |   |   |   | $ | 1,734.3 |   |   |
| European Lab                      |       |                  | 1,089.8    |                   |       |   | 752.3 |   |   |   | 283.0 |   |   |   | 932.6 |   |   |
| Science Education                 |       |                  | 146.0      |                   |       |   | 109.2 |   |   |   | 23.7 |   |   |   | 127.3 |   |   |
| Total                             |       |                  | $          | 3,138.2                |       |   |   | $ | 2,212.2 |   |   |   | $ | 793.2 |   |   |   | $ | 2,794.2 |   |   |
| **Operating Income**              |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                |       |                  | $          | 91.1                   |       |   |   | $ | 65.3 |   |   |   | $ | 28.5 |   |   |   | $ | 82.8 |   |   |
| European Lab                      |       |                  | 38.1       |                   |       |   | 24.1 |   |   |   | 13.1 |   |   |   | 35.9 |   |   |
| Science Education                 |       |                  | 14.0       |                   |       |   | 14.7 |   |   |   | (0.1 | ) |   |   | 14.0 |   |   |
| Total                             |       |                  | $          | 143.2                  |       |   |   | $ | 104.1 |   |   |   | $ | 41.5 |   |   |   | $ | 132.7 |   |   |
| **Capital Expenditures**          |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                |       |                  | $          | 10.8                   |       |   |   | $ | 6.5 |   |   |   | $ | 1.2 |   |   |   | $ | 9.2 |   |   |
| European Lab                      |       |                  | 6.9        |                   |       |   | 6.2 |   |   |   | 2.1 |   |   |   | 7.2 |   |   |
| Science Education                 |       |                  | 0.7        |                   |       |   | 0.4 |   |   |   | — |   |   |   | 0.2 |   |   |
| Total                             |       |                  | $          | 18.4                   |       |   |   | $ | 13.1 |   |   |   | $ | 3.3 |   |   |   | $ | 16.6 |   |   |
| **Depreciation and Amortization** |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                |       |                  | $          | 19.8                   |       |   |   | $ | 15.4 |   |   |   | $ | 5.1 |   |   |   | $ | 19.3 |   |   |
| European Lab                      |       |                  | 12.7       |                   |       |   | 9.3 |   |   |   | 3.6 |   |   |   | 12.6 |   |   |
| Science Education                 |       |                  | 1.4        |                   |       |   | 1.1 |   |   |   | 0.2 |   |   |   | 1.0 |   |   |
| Total                             |       |                  | $          | 33.9                   |       |   |   | $ | 25.8 |   |   |   | $ | 8.9 |   |   |   | $ | 32.9 |   |   |

 

| ** **         | ** ** | **December 31,** | ** ** |
|--------------------|------------|-----------------------|------------|
| ** **         | ** ** | **2005**              | ** ** | **2004** | ** ** |
| **Assets**         |       |                  |       |   |   |
| North American Lab |       | $                     | 1,685.9    |   | $ | 1,621.5 |   |
| European Lab       |       | 690.6                 |       | 769.6 |   |
| Science Education  |       | 165.9                 |       | 159.8 |   |
| Total              |       | $                     | 2,542.4    |   | $ | 2,550.9 |   |

 

85

----

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

The following is areconciliation of reported operating income by segment to income before income taxesand cumulative effect of a change in accounting principle:

| ** **                                  | ** ** | **Successor**         | ** ** | **Predecessor**        | ** ** |
|---------------------------------------------|------------|-----------------------|------------|------------------------|------------|
| ** **                                  | ** ** | **Year Ended**   | ** ** | **April 7–** | ** ** | **January 1–** | ** ** | **Year Ended** | ** ** |
| ** **                                  | ** ** | **December 31,** | ** ** | **December 31,**  | ** ** | **April 6,** | ** ** | **December 31,** | ** ** |
| ** **                                  | ** ** | **2005**              | ** ** | **2004**               | ** ** | **2004** | ** ** | **2003** | ** ** |
| Operating income, as  reported              |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| North American Lab                          |       |                  | $          | 91.1                   |       |   |   | $ | 65.3 |   |   |   | $ | 28.5 |   |   |   | $ | 82.8 |   |   |
| European Lab                                |       |                  | 38.1       |                   |       |   | 24.1 |   |   |   | 13.1 |   |   |   | 35.9 |   |   |
| Science Education                           |       |                  | 14.0       |                   |       |   | 14.7 |   |   |   | (0.1 | ) |   |   | 14.0 |   |   |
| Total                                       |       |                  | 143.2      |                   |       |   | 104.1 |   |   |   | 41.5 |   |   |   | 132.7 |   |   |
| Interest income                             |       |                  | (2.7       | )                      |       |   | (0.8 | ) |   |   | (0.2 | ) |   |   | (1.7 | ) |   |
| Interest expense:                           |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| Interest on push down debt                  |       |                  | —     |                   |       |   | — |   |   |   | 4.1 |   |   |   | 15.2 |   |   |
| All other interest                          |       |                  | 77.0       |                   |       |   | 51.5 |   |   |   | 1.7 |   |   |   | 10.9 |   |   |
| Other (income)  expense, net                |       |                  | (3.9       | )                      |       |   | (2.0 | ) |   |   | 0.1 |   |   |   | (3.0 | ) |   |
| Income before  income taxes and cumulative  |       |                  |       |                   |       |   |   |   |   |   |   |   |   |   |   |   |   |
| effect of a  change in accounting principle |       |                  | $          | 72.8                   |       |   |   | $ | 55.4 |   |   |   | $ | 35.8 |   |   |   | $ | 111.3 |   |   |

 

Net sales, long-livedassets and total assets by geographic area are as follows: 

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

 

|                  |   |   | **December 31,** |    |   |   |     |   |    |   |   |   |   |
|-----------------------|--------|--------|-----------------------|---------|--------|--------|----------|--------|---------|--------|--------|--------|--------|
|                  |   |   | **2005**              |    |   |   | **2004** |   |    |   |   |   |   |   |   |   |   |
| **Long-lived Assets** |   |   |                  |    |   |   |     |   |    |   |   |   |   |   |   |   |   |
| United States         |   |   | $                     | 1,064.5 |   |   |     | $      | 1,108.1 |   |   |   |   |   |   |   |   |   |   |
| International         |   |   | 612.7                 |    |   |   | 612.0    |   |    |   |   |   |   |   |   |   |   |
| Total                 |   |   | $                     | 1,677.2 |   |   |     | $      | 1,720.1 |   |   |   |   |   |   |   |   |   |   |
| **Assets**            |   |   |                  |    |   |   |     |   |    |   |   |   |   |   |   |   |   |
| United States         |   |   | $                     | 1,554.4 |   |   |     | $      | 1,522.5 |   |   |   |   |   |   |   |   |   |   |
| International         |   |   | 998.0                 |    |   |   | 1,028.4  |   |    |   |   |   |   |   |   |   |   |
| Total                 |   |   | $                     | 2,542.4 |   |   |     | $      | 2,550.9 |   |   |   |   |   |   |   |   |   |   |

 

86

----

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

**(20)   UnauditedQuarterly Financial Information**

| ** **                                                                            | ** ** | **2005–Successor** | ** ** |
|---------------------------------------------------------------------------------------|------------|-------------------------|------------|
| ** **                                                                            | ** ** | **First**               | ** ** | **Second** | ** ** | **Third** | ** ** | **Fourth(1)** | ** ** |
| Net sales                                                                             |       | $                       | 754.1      |   | $ | 794.8 |   | $ | 812.0 |   |   | $ | 777.3 |   |   |
| Gross profit                                                                          |       | 192.7                   |       | 200.8 |   | 209.6 |   |   | 200.6 |   |   |
| Operating income                                                                      |       | 25.1                    |       | 32.7 |   | 47.3 |   |   | 38.1 |   |   |
| Interest expense,  net                                                                |       | 17.8                    |       | 18.4 |   | 18.7 |   |   | 19.4 |   |   |
| Other (income)  expense, net                                                          |       | (1.0                    | )          | (0.9 | ) | (1.3 | ) |   | (0.7 | ) |   |
| Income before  income taxes and cumulative effect of a change in accounting principle |       | 8.3                     |       | 15.2 |   | 29.9 |   |   | 19.4 |   |   |
| Cumulative effect  of a change in accounting principle                                |       | —                  |       | — |   | — |   |   | (0.5 | ) |   |
| Net income                                                                            |       | 5.1                     |       | 9.2 |   | 17.6 |   |   | 9.4 |   |   |
|                                                                                       |            |                         |            |  |  |  |  |  |  |  |  |  |  |  |  |

----

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

| ** **                                                                            | ** ** | **2004**               | ** ** |
|---------------------------------------------------------------------------------------|------------|------------------------|------------|
| ** **                                                                            | ** ** | ** **             | ** ** | **Second** | ** ** | ** ** | ** ** | ** ** | ** ** |
| ** **                                                                            | ** ** | ** **             | ** ** | **Predecessor** | ** ** | **Successor** | ** ** |
| ** **                                                                            | ** ** | **Predecessor  First** | ** ** | **April 1–  April 6,  2004** | ** ** | **April 7–  June 30,  2004** | ** ** | **Third** | ** ** | **Fourth** | ** ** |
| Net sales                                                                             |       |                   | $          | 733.8 |   |   |   | $ | 59.4 |   |   |   | $ | 676.0 |   |   | $ | 760.5 |   | $ | 775.7 |   |
| Gross profit                                                                          |       |                   | 190.1      |   |   |   | 15.1 |   |   |   | 171.1 |   |   | 197.7 |   | 190.7 |   |
| Operating income                                                                      |       |                   | 38.1       |   |   |   | 3.4 |   |   |   | 31.7 |   |   | 41.2 |   | 31.2 |   |
| Interest expense,  net                                                                |       |                   | 5.3        |   |   |   | 0.3 |   |   |   | 15.9 |   |   | 16.9 |   | 17.9 |   |
| Other (income)  expense, net                                                          |       |                   | (0.3       | ) |   |   | 0.4 |   |   |   | 0.5 |   |   | (1.1 | ) | (1.4 | ) |
| Income before  income taxes and cumulative effect of a change in accounting principle |       |                   | 33.1       |   |   |   | 2.7 |   |   |   | 15.3 |   |   | 25.4 |   | 14.7 |   |
| Net income                                                                            |       |                   | 19.1       |   |   |   | 1.6 |   |   |   | 8.5 |   |   | 13.6 |   | 9.8 |   |
|                                                                                       |            |                        |            |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |

 

87

----

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

None.

**ITEM 9A.**        CONTROLSAND PROCEDURES

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

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

**ITEM 9B.**       OTHERINFORMATION

None.

**PART III**

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

**Directors and Executive Officers**

The following chart setsforth certain information regarding our directors and executive officers:

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

 

88

----

Each of our directors will hold office until our nextannual meeting or until a successor is elected or appointed. None of ourexecutive officers or directors has any familial relationship with any otherdirector or executive officer. “Familial relationship” for the purposes of thissection means any relationship by blood, marriage or adoption, not more remotethan first cousin.

*John M. Ballbach*is our President and Chief Executive Officer,as well as one of our directors, positions he has held since November 2005.Before joining us, Mr. Ballbach was a private investor since April 2004,and President of Ballbach Consulting LLC since June 2004. Prior to that,he was an officer of The Valspar Corporation, and served as its President andChief Operating Officer from 2002 until January 2004. From 2000 to 2002, Mr. Ballbachserved as the Senior Vice President of EPS, Color Corporation and Operations,of The Valspar Corporation. Mr. Ballbach joined the Valspar Corporation in1990 and had been its group Vice President, Packaging, since 1998. Mr. Ballbachis a member of the Board of Directors and Audit Committee of CelaneseCorporation. Mr. Ballbach holds a Bachelor of Arts from Georgetown Collegeand a Masters of Business Administration from the Harvard Business School.

*Jack Wyszomierski*is our Executive Vice President and ChiefFinancial Officer, a position he has held since June 2004. Prior tojoining us in 2004, Mr. Wyszomierski spent over 20 years at theSchering-Plough Corporation, a corporation that develops and marketsprescription drugs, animal health products, over-the-counter drugs and personalcare products. Mr. Wyszomierski held a variety of positions atSchering-Plough, most recently serving as Executive Vice President and ChiefFinancial Officer from 1996 until 2003. Mr. Wyszomierski is a member ofthe Board of Directors and the Chairman of the Audit Committee of ExelixisCorporation. Mr. Wyszomierski holds a Bachelor of Science and a Masters ofScience from Carnegie Mellon University.

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

*Manuel Brocke-Benz*is our Senior Vice President & ManagingDirector of Europe, Lab Distribution and Services, a position he has held sinceJanuary 2006. Mr. Brocke-Benz joined the company in 1987. Prior toassuming his present position Mr. Brocke-Benz served as our Senior VicePresident and General Manager Continental Europe from 2003 to 2005 and as ourCorporate Senior Vice President Process Excellence from 2001 to 2003. Duringthe years 1996 to 2001 he served as General Manager Benelux countries, VPEuropean Key Accounts, VP European Marketing and Corporate Senior VP GlobalE-business. Mr. Brocke-Benz holds a law degree from Albert-LudwigsUniversity in Freiburg, Germany.

*Charles Canfield*is our Senior Vice President, Human Resources,a position he has held since July 2004. Prior to joining us in 2004, Mr. Canfieldwas the Senior Vice President, Human Resources and Communications, of the OndeoNalco Company from 2001 until 2003. Before joining Ondeo Nalco, Mr. Canfieldhad a long tenure with Moore Corporation Limited, a company specializing in themanufacture of business forms. Mr. Canfield began his career at Moore in1973, most recently serving as the President of Moore’s Canadian operatingdivision from 1997 until 1998, and as Moore’s Vice President, Corporate HumanResources and Communications, from 1988 until 1997 and from 1998 until 2001. Mr. Canfieldis a member of the Board of Directors of the Human Resources ManagementAssociation of Chicago. Mr. Canfield holds a Bachelor of Science fromCalifornia State University and a Masters of Business Administration from theUniversity of Toronto.

89

----

*Theodore Pulkownik*is our Senior Vice President, Strategy andBusiness Development, a position he has held since July 2004. Prior tojoining us in 2004, Mr. Pulkownik held two positions with Standard &Poors, which is a division of the McGraw-Hill Companies. From 2002 until 2004, Mr. Pulkownikwas a Managing Director of Standard & Poors Corporate ValueConsulting, and from 2000 to 2002, Mr. Pulkownik was the Senior VicePresident, Business Development, for Standard & Poors. Before joiningStandard & Poors, Mr. Pulkownik was a Senior Vice President forHolberg Industries, a diversified private holding company located in Greenwich,Connecticut, from 1999 until 2000. From 1997 until 1999, Mr. Pulkownik wasa Managing Director, Corporate Business and Development, for General ElectricCapital Corporation. Mr. Pulkownik holds a Bachelor of BusinessAdministration from the University of Wisconsin and a Masters of BusinessAdministration from the University of Michigan.

*Kevin Leak*is our Senior Vice President of CategoryManagement, a position he has held since January 2006. Mr. Leakjoined us in 1995 when we acquired the Baxter Scientific Products industrialdistribution business from Baxter International. Prior to assuming his currentposition, Mr. Leak served as our Vice President of Global StrategicSourcing & Supply Chain Management from 2004 to 2005, the NorthAmerica Vice President of Marketing from 2000 to 2004, and Vice President ofMarketing for our Production Supplies & Services business from 1998 to2000. Mr. Leak is a former United States Army officer where he heldseveral positions in both command and staff. He is a graduate of PaceUniversity with a Bachelor of Business Administration in Management and Mastersof Business Administration in Marketing.

*Jon Michael Colyer*is our Vice President and General Manager ofScience Education, a position he has held since May 2005. Mr. Colyerjoined us in 2004 as our Vice President North American Call Centers. Prior tojoining us, Mr. Colyer worked for Textron, a large industrialconglomerate, as the Director for Enterprise Excellence and Director of BellHelicopter’s Composite Manufacturing facility. Prior to Textron, Mr. Colyerspent five years with GE in various roles including Six Sigma Black Belt,Ecommerce Program Manager, and Leadership Development Program Member. Mr. Colyergraduated from the University at Buffalo in 1996 with a Bachelor of Science inCivil Engineering and an MBA in Corporate Finance.

*B. Charles Ames*is one of our directors, a position he has heldsince the Acquisition. Mr. Ames is Vice Chairman and a principal ofCD&R. Prior to joining CD&R in 1987, Mr. Ames served as Chairmanand Chief Executive Officer of Reliance Electric Company, Chief ExecutiveOfficer of Acme Cleveland Corporation, and Chief Executive Officer and Chairmanof The Uniroyal Goodrich Tire Company. Mr. Ames’ family trust is a limitedpartner of CD&R Associates VI Limited Partnership. Mr. Ames is adirector and stockholder of CD&R Investment Associates VI, Inc. Healso serves on the Boards of Directors of Lexmark International, Inc. andRemington Arms Company, Inc. Mr. Ames holds a Ph.B. from IllinoisWesleyan University and a Masters of Business Administration from HarvardBusiness School.

*Joseph F. Eckroth, Jr.*is one of our directors, aposition he has held since November 9, 2004. Mr. Eckroth is theExecutive Vice President and Chief Operating Officer for New Century FinancialCorporation. Prior to joining New Century, Mr. Eckroth served as the ChiefInformation Officer for Mattel, Inc., a position he held from 2000 until2005. Prior to joining Mattel, Inc., Mr. Eckroth served as aninformation technology executive for the General Electric Company from 1996until 2000, where he was the Chief Information Officer for the GE MedicalSystems and GE Industrial Systems business units. Prior to joining GeneralElectric, Mr. Eckroth served in a variety of senior leadership positionsfor the Northrop Grumman Corporation from 1985 until 1996, most recently asDirector of Information Systems and Technology. Mr. Eckroth holds aBachelor of Science from the University of La Verne and a Masters of BusinessAdministration from Pepperdine University School of Business and Management.

90

----

*Dr. Lewis S. Edelheit*is one of our directors, a position he has heldsince August 31, 2004. Dr. Edelheit retired from his position as theSenior Vice President, Corporate Research and Development, for the GeneralElectric Company in 2001. Dr. Edelheit began his long tenure at GeneralElectric as a physicist in the General Electric Research and Development Centerin 1969, and returned to General Electric in 1991 to head its research anddevelopment efforts after a stint as the President and Chief Executive Officerof Quantum Medical Systems from 1986 until 1991. Dr. Edelheit is a memberof the National Academy of Engineering, and a Fellow of the American PhysicalSociety. Dr. Edelheit serves as a director of Silicon Graphics, Inc.,Sonic Innovations, Inc. and Hubspan, Inc. Dr. Edelheit holds aBachelor of Science, a Masters of Science and a Ph.D. from the University ofIllinois.

*Brian P. Kelley*is one of our directors, a position he has heldsince August 31, 2004. Mr. Kelley is the President and ChiefExecutive Officer of SIRVA, Inc., a position he has held since 2002. Priorto joining SIRVA, Inc., Mr. Kelley was an executive for the FordMotor Company, serving as the President of Ford’s Lincoln Mercury business from2001 until 2002, and as Ford’s Vice President of Global Consumer Services from1999 until 2001. Prior to joining Ford, Mr. Kelley was a senior executivefor General Electric Company from 1994 until 1999. Mr. Kelley began hiscareer at Procter & Gamble in 1983, where he was ultimatelyresponsible for some of the company’s most recognized brand names. Mr. Kelleyalso serves as a director of SIRVA, Inc. Mr. Kelley received aBachelor of Arts in economics from The College of Holy Cross.

*Joseph L. Rice, III*is one of our directors, a position he has heldsince shortly after the Acquisition. Mr. Rice is one of the originalpartners of CD&R. Mr. Rice has spent the major portion of his businesscareer in private equity. After graduating from law school in 1960, Mr. Ricepracticed law with Sullivan & Cromwell until 1966 when he entered theprivate equity business. In 1969, Mr. Rice co-founded Gibbons, Green &Rice, and in 1978, CD&R. Mr. Rice is a Trustee of The Chapin School, aTrustee Emeritus of Williams College and a member of the Board of Trustees ofThe Manhattan Institute, INSEAD’s International Council and the JPMorganNational Advisory Board. Mr. Rice is a limited partner of CD&RAssociates VI Limited Partnership, and a director and stockholder of CD&RInvestment Associates VI, Inc. Mr. Rice is a Director of ItaltelHolding S.p.A. and Uniroyal Holding, Inc. After graduating from Williamsin 1954, Mr. Rice enlisted in the United States Marine Corps and served asa Lieutenant from 1954 to 1957. Mr. Rice then earned his law degree atHarvard Law School.

*James W. Rogers*is our Chairman, a position he has held sincethe Acquisition. Mr. Rogers served as our Chief Executive Officer from May untilNovember 2005. Mr. Rogers is an operating principal of CD&R.Prior to joining CD&R in 1998; Mr. Rogers was a Senior Vice Presidentand a member of the Corporate Executive Council of General Electric Company.From 1995 to 1998, Mr. Rogers was President and Chief Executive Officer ofGE Industrial Control Systems. Mr. Rogers is a limited partner of CD&RAssociates VI Limited Partnership, and a director and stockholder of CD&RInvestment Associates VI, Inc. Mr. Rogers currently serves as adirector of SIRVA, Inc. Mr. Rogers holds a Bachelor of Arts ineconomics from Rutgers College.

*Axel Ruckert*is one of our directors, a position he has heldsince August 31, 2004. Mr. Ruckert is the President of ManagementPartenaires, a French firm specializing in turn-around management of companiesexperiencing financial difficulties. Since founding Management Partenaires in1984, Mr. Ruckert has held executive positions with several companieswhile working to implement strategic restructurings of these companies, mostrecently serving as the Chairman and Chief Executive Officer of Getronics, aninformation technology services company, in 2003. Prior to working at Getronics,Mr. Ruckert was the Chief Executive Officer of Philips ConsumerCommunications from 2001 until 2002, and the Chief Operating Officer of BSNGlasspack, a European glass container manufacturer, from 1999 until 2000. Mr. Ruckertreceived a Master of Political Science and Economics at the Free University ofBerlin and the University of Cologne.

91

----

*Richard J. Schnall*is one of our directors, a position he has heldsince the Acquisition. Mr. Schnall is a financial principal of CD&R.Prior to joining CD&R in 1996, he worked in the Investment Banking divisionof Donaldson, Lufkin & Jenrette, Inc. and Smith Barney &Co. Mr. Schnall is a limited partner of CD&R Associates VI LimitedPartnership, and a director and stockholder of CD&R Investment AssociatesVI, Inc. He serves as a director of SIRVA, Inc. Mr. Schnall is agraduate of the Wharton School of Business at the University of Pennsylvaniaand holds a Masters of Business Administration from Harvard Business School.

*Carl T. Stocker*is one of our directors, a position he has heldsince August 31, 2004. Since 1997, Mr. Stocker has owned and managedhis own acquisition, investment and consulting company, CTS Enterprises, LLC.Prior to that time, Mr. Stocker served as the chief financial executive ofGeneral Electric’s Industrial Systems business from 1990 until 1996, and thechief information executive from 1992 until 1996. Mr. Stocker was also amember of General Electric’s Corporate Finance and Information TechnologyCouncils during these same periods, and served as a senior integration leaderfor the Space Systems Division created by General Electric’s acquisition ofRCA. Mr. Stocker is a director of SIRVA, Inc. Mr. Stockergraduated from Wright State University in 1970 after serving with the U.S.Army.

*Robert J. Zollars*isone of our directors, a position he has held since August 31, 2004. Since1999, Mr. Zollars has been the Chairman and CEO of Neoforma, Inc., ahealthcare technology company focusing on the supply chain. Prior to joiningNeoforma, Mr. Zollars was the EVP and Group President of Cardinal Health, Inc.,from 1997 until 1999, and was responsible for five of their wholly-ownedsubsidiaries. From 1992 until 1996, Mr. Zollars was the President of theHospital Supply and Scientific Product distribution business at BaxterInternational. Mr. Zollars serves as a director of For Health Technologiesand Alliance Medical Corp. Mr. Zollars is the Chairman of the Center forServices Leadership at Arizona State University, and is a member of the YoungPresidents Organization. Mr. Zollars is a graduate of Arizona StateUniversity and holds a Masters of Business Administration from John F. KennedyUniversity.

**Compositionof our Board of Directors**

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

**Audit Committee**

Our audit committeecurrently consists of Dr. Lewis S. Edelheit, Joseph L. Rice, III,Axel Ruckert, Richard J. Schnall, and Carl T. Stocker. Our board of directorshas determined that Carl T. Stocker is the current audit committee financialexpert serving on the audit committee for purposes of the Securities andExchange Act of 1934. Mr. Stocker is an independent director within themeaning of the Securities and Exchange Act of 1934. Our audit committee hasresponsibility for, among other things, assisting our board of directors inmonitoring:

·       thequality of our financial reporting and other internal control processes,

·       thequality and integrity of our financial statements,

·       theindependent auditors’ qualifications and independence,

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

·       our compliance with legaland regulatory requirements and its code of conduct.

92

----

**Code of Ethics**

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

**ITEM 11.**         EXECUTIVECOMPENSATION

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

**Summary Compensation Table**

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

----

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

93

----

Mr. Brocke-Benz.The 2004 amount reported for Mr. Orzetti includes a housing allowance of$11,399. The 2003 amounts reported include (a) automobile allowances of$14,190 and $14,190 for Messrs. Zywottek and Malenfant and (b) $7,150for an automobile lease paid by the Company for Mr. Brocke-Benz.

(2)             Amounts reported for 2005 include (a) acontribution to our 401(k) or other defined contribution retirement planof $4,833 and $9,167 for Messrs. Orzetti and Malenfant, (b) imputedvalue of guaranteed term life insurance policies for Messrs. Ballbach,Zywottek, Orzetti, Wyszomierski and Malenfant of $69, $1,183, $793, $1,109 and$380, (c) relocation benefits of $73,981 for Mr. Ballbach inconnection with his move to commence employment and (d) a payment of$86,538 to Mr. Zywottek for his accrued unused vacation. Amounts reportedfor 2004 include (a) respective special payments of $54,450, $108,900,$48,400, $16,940 and $16,940 to Messrs. Zywottek, Orzetti, Wyszomierski,Malenfant and Brocke-Benz earned in connection with the December 16, 2004issuance by CDRV Investors, Inc. of $481.0 million aggregate principalamount at maturity ($299.4 million gross proceeds) of 95¤8% senior discount notes due 2015 and arelated special distribution to CDRV Investors, Inc. shareholders, (b) paymentsto Messrs. Zywottek, Malenfant and Brocke-Benz of $13,240, $3,788 and$3,797 in settlement of our obligations under a predecessor bonus plan that wasterminated in connection with the Acquisition, (c) a contribution to our401(k) or other defined contribution retirement plan of $4,772 for Mr. Malenfantand (d) imputed value of guaranteed term life insurance policies for Messrs. Zywottek,Orzetti, Wyszomierski and Malenfant of $2,658, $360, $338 and $226. Amountsreported for 2003 include (a) a contribution to our 401(k) or otherdefined contribution retirement plan of $4,364 for Mr. Malenfant and (b) imputedvalue of guaranteed term life insurance policies for Messrs. Zywottek andMalenfant of $1,956 and $202.

(3)             Mr. Ballbach was granted 6,666 CDRV Investors, Inc.restricted stock units in connection with his commencement of employment. Thevalue of Mr. Ballbach’s restricted stock unit grant is shown based on thevalue of an unrestricted share of CDRV Investors, Inc. common stock onsuch date. Mr. Ballbach is not entitled to receive any dividends on hisrestricted stock units. The restricted stock units will vest in equal annualinstallments on each of the first five anniversaries of the grant date or, ifearlier, on a change in control or termination of employment on death ordisability (all as provided under the Restricted Stock Unit Agreement and theCDRV Investors, Inc. Stock Incentive Plan). The 6,666 CDRV Investors, Inc. restricted stock units Mr. Ballbachreceived in this grant were the only restricted stock units held by him as ofDecember 31, 2005.  Mr. Ballbach’srestricted stock holdings, including restricted stock units, were valued at$500,000, based on the value of an unrestricted share of CDRV Investors, Inc.common stock as of December 31, 2005. Messrs. Wyszomierski, Malenfant andBrocke-Benz were granted 3,333, 3,333 and 2,000 CDRV Investors, Inc.restricted stock units, respectively, pursuant to the CDRV Investors, Inc.Stock Incentive Plan. Messrs. Wyszomierski, Malenfant and Brocke-Benz arenot entitled to receive any dividends on their restricted stock units. Therestricted stock units will vest in equal annual installments on each of thefirst five anniversaries of the grant date or, if earlier, on a change incontrol or termination of employment on death or disability (all as providedunder the Restricted Stock Unit Agreement and the CDRV Investors, Inc. StockIncentive Plan).  The value of therestricted stock unit grants of Messrs. Wyszomierski, Malenfant and Brocke-Benzis shown based on the value of an unrestricted share of CDRV Investors, Inc.common stock on the date of grant.  Theseunits were the only restricted stock units held by Messrs. Wyszomierski,Malenfant and Brocke-Benz as of December 31, 2005, and the restricted stockholdings, including restricted stock units, of each of Mr. Wyszomierski,Malenfant and Brocke-Benz were valued at $250,000, $250,000, and $150,000,respectively, based on the value of an unrestricted share of CDRV Investors,Inc. common stock as of December 31, 2005. Mr. Orzetti was granted5,000 CDRV Investors, Inc. restricted stock units in connection with hiscommencement of employment. The restricted stock units had a value of $280,000on the date of grant based on the value of an unrestricted share of CDRVInvestors, Inc. common stock on such date. The value of Mr. Orzetti’srestricted stock units, based on the value of an unrestricted share of CDRVInvestors, Inc. common stock, as of December 31, 2005 was $375,000. Mr. Orzettiis not entitled to receive any dividends on his restricted stock units. All of Mr. Orzetti’srestricted stock units were forfeited in February 2006 in connection withhis termination of employment.

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

(5)             Mr. Rogers served as our Chief ExecutiveOfficer from May 2005 until November 2005 pursuant to a loanoutagreement we entered into with Clayton, Dubilier & Rice, Inc. Mr. Rogersremained an employee of Clayton, Dubilier & Rice, Inc. while heserved as our Chief Executive Officer and was therefore not paid anycompensation by us for his services. The management fee we pay to Clayton,Dubilier & Rice, Inc. pursuant to the consulting agreementdescribed under the heading “Certain Relationships and Related Transactions—ConsultingAgreement” was increased by $500,000 annually for the period Mr. Rogersserved as our Chief Executive Officer.

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

94

----

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

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

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

----

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

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

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

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

**EmploymentAgreements With Named Executive Officers**

·                   *Mr. Ballbach.  *InNovember 2005, Mr. Ballbach joined us as our new President and ChiefExecutive Officer, and entered into an employment agreement with us inconnection with his commencement of employment. Mr. Ballbach’s agreementwas subsequently amended in part by a letter agreement entered into in February 2006.

Pursuant to his amendedemployment agreement and as of December 31, 2005, Mr. Ballbachreceives an annual base salary of $650,000 and is also eligible to receive anannual bonus that becomes earned based on the achievement of objectivesestablished under our applicable bonus plan. Mr. Ballbach’s target annualbonus is equal to 100% of his base salary. Because Mr. Ballbach startedwith us before November 7, 2005, he received a guaranteed bonus of$100,000 for 2005. In addition, we agreed to pay Mr. Ballbach a one-timespecial bonus of $1,119,651 in February 2006 in connection with hisagreeing to amend the terms of his original employment agreement.

Mr. Ballbach’samended agreement does not have a fixed term. However, if we terminate Mr. Ballbach’semployment without cause, he will be entitled to continued payment of his current

95

----

base salary and continuedhealth benefits for a period equal to the earlier of eighteen months followingany such termination or the date that he obtains new employment.

Pursuantto Mr. Ballbach’s amended employment agreement, he agreed to purchase19,643 shares of the common stock of CDRV Investors, Inc. during March 2006pursuant to the CDRV Investors, Inc. Stock Incentive Plan. In connectionwith his purchase, he received a grant of 58,929 options to purchase shares of CDRVInvestors, Inc. common stock. Mr. Ballbach’s amended agreement alsoprovides that in 2006 he will receive an award of CDRV Investors, Inc.restricted stock units having a value equal to $500,000. The restricted stockunits will vest in five equal installments on each of the first fiveanniversaries of the grant date, and may vest earlier in certain circumstancesif we undergo a change in control (as defined in the CDRV Investors, Inc.Stock Incentive Plan) or if his employment terminates due to death ordisability (as defined in the CDRV Investors, Inc. Stock Incentive Plan).

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

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

In connection with Mr. Orzetti’stermination of employment in February 2006, we entered into an agreementwith him setting forth the terms of his resignation. Under the agreement, Mr. Orzettiis entitled to receive a lump sum severance payment equal to $550,000,continued health and dental benefits until August 31, 2006, COBRA benefit continuation,the repurchase of previously acquired shares of CDRV Investors, Inc.common stock, and accelerated vesting of 9,000 unvested options in CDRVInvestors, Inc.

Theagreement also contains customary non-competition and non-solicitationrestrictions that will apply for one year following Mr. Orzetti’sresignation, and an indefinite restriction on the disclosure of confidentialinformation.

·                   *Mr. Wyszomierski*.   In June 2004,Mr. Wyszomierski joined us as our new Executive Vice President and ChiefFinancial Officer, and entered into an employment agreement with us upon hiscommencement of employment. Mr. Wyszomierski’s agreement does not have afixed term. Pursuant to his employment agreement and as of December 31,2005, Mr. Wyszomierski receives an annual base salary of $350,000 and isalso eligible to receive an annual bonus that becomes earned based on theachievement of objectives established under our applicable bonus plan. Mr. Wyszomierski’starget annual bonus is equal to 85% of his base salary.

Mr. Wyszomierskiwas offered the opportunity to participate in the CDRV Investors, Inc.Stock Incentive Plan pursuant to his employment agreement. In late 2005, Mr. Wyszomierski wasgranted CDRV Investors, Inc. restricted stock units having a value equal to$250,000. The restricted stock units will vest in five equal installments oneach of the first five anniversaries of the grant date, and may vest earlier incertain circumstances if we undergo a change in control (as defined in the CDRVInvestors, Inc. Stock Incentive Plan) or if his employment terminates dueto death or disability (as defined in the CDRV Investors, Inc. StockIncentive Plan).

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

96

----

established underour applicable bonus plan. Mr. Malenfant’s target annual bonus is equal to75% of his base salary.

Mr. Malenfantwas offered the opportunity to participate in the CDRV Investors, Inc.Stock Incentive Plan. In late 2005, Mr. Malenfant was granted CDRVInvestors, Inc. restricted stock units having a value equal to $250,000.The restricted stock units will vest in five equal installments on each of thefirst five anniversaries of the grant date, and may vest earlier in certaincircumstances if we undergo a change in control (as defined in the CDRVInvestors, Inc. Stock Incentive Plan) or if his employment terminates dueto death or disability (as defined in the CDRV Investors, Inc. StockIncentive Plan).

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

Mr. Brocke-Benz wasoffered the opportunity to participate in the CDRV Investors, Inc. StockIncentive Plan. In late 2005, Mr. Brocke-Benz was granted CDRV Investors, Inc.restricted stock units having a value equal to $150,000. The restricted stockunits will vest in five equal installments on each of the first fiveanniversaries of the grant date, and may vest earlier in certain circumstancesif we undergo a change in control (as defined in the CDRV Investors, Inc.Stock Incentive Plan) or if his employment terminates due to death ordisability (as defined in the CDRV Investors, Inc. Stock Incentive Plan).

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

The CDRV Investors, Inc.Stock Incentive Plan provides that the vesting of options to purchase shares ofCDRV Investors, Inc. common stock granted thereunder will be acceleratedif CDRV Investors, Inc. experiences a change in control (as defined in theplan) where substitute options with substantially equivalent terms and economicvalue are not substituted for existing options in place of accelerated vesting.The vesting of options will also be accelerated upon certain terminations ofemployment, such as death or disability (as defined in the plan). CDRVInvestors, Inc.’s board of directors has the discretion to accelerate thevesting of options at any time and from time to time.

**Pension Plans**

We sponsor variousretirement plans for most full-time employees, including a defined benefit planthat covered Messr. Malenfant until the plan was frozen on May 31,2005 and Mr. Zywottek until his termination of employment in 2005.

Thepension plan we sponsor covered substantially all of our full-time UnitedStates employees (except employees covered by collective bargaining agreementswho participate in independently operated plans). Annual retirement benefitsunder the pension plan are generally calculated as the greater of:

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

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

Underthe pension plan, final average earnings includes the participant’s salary andbonus indicated earlier under the heading “—Summary Compensation Table,” aswell as any other bonus or severance payments that a participant may becomeentitled to. Because the pension plan complies with ERISA and Code maximumcompensation and defined benefit limitations, certain of the annual retirementbenefits indicated in the table below will be paid pursuant to an unfundedbenefit equalization plan, or 

97

----

supplemental plan, of the type permitted by ERISA. Thefollowing table shows the estimated annual benefits payable upon retirement topersons in specified remuneration and years of service classifications underthe pension plan and supplemental plan.

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

 

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

**Compensation of Directors**

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

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

We do not pay any additional remuneration to any ofour directors who are also our employees or who are employees or principals ofCD&R, however all such directors are reimbursed for reasonable travel andlodging expenses incurred to attend meetings of our board of directors or acommittee thereof.

98

----

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

CDRVInvestors, Inc. owns, through CDRV Holdings, Inc., all of theoutstanding capital stock of VWR International, Inc. The following tablelists all shares of common stock of CDRV Investors, Inc. beneficiallyowned by the following holders as of March 24, 2006:

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

 

----

*                    Less than 1%

(1)          In accordance with Rule 13d-3under the Exchange Act, as amended, a person is deemed a “beneficial owner” ofa security if he or she has or shares the power to vote or direct the voting ofsuch security or the power to dispose or direct the disposition of suchsecurity. A person is also deemed to be a beneficial owner of any securitieswhich that person has the right to acquire beneficial ownership of within 60days. More than one person may be deemed to be a beneficial owner of the samesecurities. Each of such stockholders has sole voting and investment power asto the shares unless otherwise noted.

(2)          CD&R Associates VILimited Partnership, a Cayman Islands exempted limited partnership, is thegeneral partner of CD&R Fund VI and has the power to direct CD&R FundVI as to the voting and disposition of shares held by CD&R Fund VI.CD&R Investment Associates VI, Inc., a Cayman Island exempted company,is the general partner of CD&R Associates VI Limited Partnership and hasthe power to direct CD&R Associates VI Limited Partnership as to itsdirection of CD&R Fund VI’s voting and disposition of the shares heldby CD&R Fund VI. No person controls the voting and disposition of CD&RInvestment Associates VI, Inc., with respect to the shares owned byCD&R Fund VI. Each of CD&R Associates VI Limited Partnership andCD&R Investment Associates VI, Inc. expressly disclaimsbeneficial ownership of the shares owned by CD&R Fund VI. 

99

----

The business address foreach of CD&R Fund VI, CD&R Associates VI Limited Partnership andCD&R Investment Associates VI, Inc., is 1403 Foulk Road, Suite 106,Wilmington, Delaware 19803.

(3)          Banc of America CapitalInvestors, L.P. is a Delaware limited partnership. Banc of America CapitalManagement, L.P., a Delaware limited partnership, is the general partner ofBanc of America Capital Investors, L.P. and has the power to direct Banc ofAmerica Capital Investors, L.P. as to the voting and disposition of shares heldby Banc of America Capital Investors, L.P. BACM I GP, LLC, a Delaware limitedliability company, is the general partner of Banc of America Capital ManagementL.P. and has the power to direct Banc of America Capital Management L.P. as tothe voting and disposition of shares held by Banc of America Capital ManagementL.P. The business address for Banc of America Capital Investors, L.P., Banc ofAmerica Capital Management, L.P. and BACM I GP, LLC, is Bank of AmericaCorporate Center, 100 North Tryon Street, 25th Floor, Charlotte, NC 28255.

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

(5)          All shares previouslyheld by Mr. Zywottek were repurchased in connection with his terminationof employment in May 2005.

(6)          In connection with histermination of employment in February 2006, the 15,000 shares previouslyheld by Mr. Orzetti were repurchased. Mr. Orzetti currently holds18,000 vested options that may be exercised anytime until May 31, 2006.All shares and options were issued pursuant to the CDRV Investors, Inc.Stock Incentive Plan.

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

(8)          Mr. Malenfant owns3,500 shares and has 1,400 options that are currently vested and exercisable.All shares and options were issued pursuant to the CDRV Investors, Inc.Stock Incentive Plan.

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

(10)   Does not include 4,200,000shares owned by Clayton Dubilier & Rice Fund VI Limited Partnership. Messrs. Ames,Rice III, Rogers and Schnall may be deemed to share beneficial ownership of theshares owned of record by Clayton Dubilier & Rice Fund VI LimitedPartnership by virtue of their status as stockholders of CD&R InvestmentAssociates VI, Inc., the general partner of CD&R Associates VI LimitedPartnership. However, each of Messrs. Ames, Rice III, Rogers and Schnallexpressly disclaims beneficial ownership of the shares owned by ClaytonDubilier & Rice Fund VI Limited Partnership.

(11)   Includes 1,090 shares that werepurchased by Mr. Eckroth under the CDRV Investors, Inc. StockIncentive Plan that were immediately transferred to a trust created for thebenefit of Mr. Eckroth’s family.

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

100

----

**ITEM13.   CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS**

**InvestmentFund Managed by CD&R**

***Overview.***   As of March 24,2006, CD&R Fund VI beneficially owns approximately 71.8% of the outstandingcommon stock of our ultimate parent company, CDRV Investors, Inc. CD&RFund VI is a private investment fund managed by CD&R.

The general partner ofCD&R Fund VI is CD&R Associates VI Limited Partnership, a CaymanIslands exempted limited partnership. CD&R Associates VI LimitedPartnership’s general partner is CD&R Investment Associates VI, Inc.,a Cayman Islands exempted company.

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

CD&R is a privateinvestment firm organized as a Delaware corporation. CD&R is the manager ofa series of investment funds, including CD&R Fund VI. CD&R generally assistsin structuring, arranging financing for and negotiating the acquisition of thecompanies in which the funds it manages invest. After the consummation of suchtransactions, CD&R generally provides management and financial consultingservices to the companies. Such services include helping companies to establisheffective banking, legal and other business relationships and assistingmanagement in developing and implementing strategies for improving theiroperational, marketing and financial performance.

***Stock Purchase Agreement.***   Inconnection with the Acquisition, CD&R Fund VI and CDRV AcquisitionCorporation entered into various agreements, including a stock purchaseagreement, dated as of February 15, 2004, with Merck KGaA, pursuant towhich CDRV Acquisition Corporation and certain of its affiliates agreed topurchase all of the outstanding capital stock of VWR International Corporation,the holding company of VWR International, Inc., and 10% of the outstandingequity ownership interests of VWR International Immobilien GmbH that we did notown. Pursuant to these agreements, Merck KGaA agreed to not solicit certain ofour employees for a period of two years following the completion of theAcquisition. Merck KGaA also agreed to not act as a distributor of certaincompetitive laboratory products, excluding certain products such aspharmaceutical products and ingredients, in the laboratory field in NorthAmerica and many Western European countries, or own an interest in any suchdistributor, subject to certain ownership exceptions. This restriction expireson the third anniversary of the completion of the Acquisition. CD&R FundVI, on the other hand, agreed to not sell any controlling interest in us or ourbusiness to any entity that derives more than 10% of its total revenues fromthe manufacture, distribution and sale of chemical products for industrial orR&D uses. This restriction expires upon our initial public offering ofvoting securities. In addition, the parties agreed to certain indemnificationobligations for breaches of their respective representations, warranties andcovenants.

***Consulting Agreement.***   CDRVInvestors, Inc., CDRV Holdings, Inc., CDRV Acquisition Corporationand CD&R entered into a Consulting Agreement immediately prior to theAcquisition, pursuant to which CD&R provides us with financial advisory andmanagement consulting services following the consummation of the Transactions.We pay CD&R a management fee of $1.5 million annually, which will bereviewed on an annual basis. We paid CD&R a fee of $18.0 million ascompensation for performing financial, investment banking, management advisoryand other services in connection with the Acquisition, and reimbursed certainCD&R expenses. Effective as of May 15, 2005, the parties entered intoa loanout agreement under the Consulting Agreement whereby CD&R agreed tomake the services of James W. Rogers, the current Chairman of our Board and aCD&R employee, available to us. The management fee payable to CD&R wasincreased by $0.5 million annually for the period Mr. Rogers was our ChiefExecutive Officer, and $0.3 million was paid to CD&R in the year ended December 31,2005 in connection therewith. The loanout agreement terminated pursuant to itsterms upon the approval of Mr. Ballbach’s employment as our ChiefExecutive Officer.

101

----

***Indemnification Agreement.***   CDRVInvestors, Inc., CDRV Holdings, Inc., CDRV Acquisition Corporationand their respective subsidiaries entered into an Indemnification Agreementwith CD&R and CD&R Fund VI immediately prior to the Acquisition,pursuant to which, following the consummation of the Transactions, we wouldindemnify CD&R, CD&R Fund VI, any other investment vehicle managed byCD&R, their respective directors, officers, partners, employees, agents andcontrolling persons, against certain liabilities arising under federal securitieslaws, liabilities arising out of the performance of the consulting agreementand certain other claims and liabilities.

***Stock Subscription Agreement.***   Asof March 24, 2006, CD&R Fund VI beneficially owns approximately 71.8%of the outstanding shares of common stock of CDRV Investors, Inc. Itsubscribed for 4,800,000 shares of CDRV Investors, Inc.’s common stock foran aggregate purchase price of $480.0 million pursuant to a Stock SubscriptionAgreement, dated as of April 7, 2004. Pursuant to that agreement, CD&RFund VI may designate all of the members of the Board of Directors of CDRVInvestors, Inc. and certain of its direct and indirect subsidiaries. CD&Ris also entitled to consult with CDRV Investors, Inc. with respect to ouroperations at any time, to have observers attend meetings of its Board ofDirectors and those of its subsidiaries, including us, and to receive all ofits quarterly and annual financial reports and budgets, as well as otherdocuments.

On June 22, 2004,CD&R Fund VI transferred an aggregate of 500,000 shares of the common stockof CDRV Investors, Inc. to five of its limited partners, and on December 6,2004, CD&R Fund VI transferred another 100,000 shares of CDRV Investors, Inc.common stock to another of its limited partners, pursuant to transferagreements among the Company, CD&R Fund VI and each such transferee.Pursuant to the transfer agreements, transferees are entitled to the rights andobligations of a minority stockholder under the Registration and ParticipationAgreement, dated as of April 7, 2004, including the transferrestrictions, registration rights, tag-along rights and drag-along rightsthat are described below under the heading “—Agreement with Management andOther Investors—Registration and Participation Agreement.”

**Agreementswith Management and Other Investors**

***Management Equity Offerings.***   Shortlyafter the completion of the Acquisition, CDRV Investors, Inc., ourultimate parent company, adopted the CDRV Investors, Inc. Stock IncentivePlan. Under the plan, certain of our officers and employees were offered theopportunity to purchase shares of CDRV Investors, Inc. common stock andreceive grants of options to purchase common stock. CDRV Investors, Inc.also offered our non-employee directors the opportunity to purchase shares ofits common stock.

Pursuant to Mr. Ballbach’samended employment agreement described under the heading “ExecutiveCompensation—Employment Agreements with Named Executive Officers,” Mr. Ballbachpurchased 19,643 shares of CDRV Investors, Inc. common stock during March 2006pursuant to the plan. In connection with his purchase, he received a grant of58,929 options under the plan. Mr. Ballbach will also receive a grant ofrestricted stock units under the plan having a total value of $500,000.

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

At the time of Mr. Leak'spromotion to Senior Vice President of Category Management, he had a loanguaranteed by the Company in connection with his purchase of CDRV Investors,Inc. shares of approximately $200,000 that has since been repaid.

102

----

***Registration andParticipation Agreement***

CDRV Investors, Inc.,CD&R Fund VI and certain other stockholders of CDRV Investors, Inc.entered into a Registration and Participation Agreement, dated as of April 7,2004, pursuant to which, among other things:

***Transfer Restrictions.***   Untilthe earlier of the initial public offering of the common stock of CDRVInvestors, Inc. and the fifth anniversary of the agreement, holders ofcommon stock of CDRV Investors, Inc. other than CD&R Fund VI aresubject to certain restrictions on transfer.

***Registration Rights.***   Holdersof shares of common stock of CDRV Investors, Inc., including certainexecutive officers, are entitled to registration rights for such shares ofcommon stock held by them:

·                    holdersconstituting, at any time prior to the initial public offering of the commonstock of CDRV Investors, Inc., at least 50% and thereafter, at least 25%,of the total registrable securities may request that CDRV Investors, Inc.use its best efforts to register such securities for public resale,

·                    following theinitial public offering of the common stock of CDRV Investors, Inc., underspecified circumstances (and if CDRV Investors, Inc. has qualified forregistration on Form S-3), certain holders other than CD&R FundVI may request that CDRV Investors, Inc. use its best efforts to registertheir shares of common stock of CDRV Investors, Inc. for public resale on Form S-3,and

·                    if CDRVInvestors, Inc. registers any common stock at any time, either for itsaccount or for the account of any stockholder, the holders of registrablesecurities are entitled to request that it use its best efforts to include thenumber of their shares of common stock that, in the opinion of theunderwriters, can be sold.

CDRV Investors, Inc.will bear all registration expenses (other than underwriting discounts) for thefirst four registrations, including the fees and expenses of counsel to theselling stockholders. Because only CD&R Fund VI holds more than 50% of itsoutstanding common stock, it is the only stockholder able to initiate theinitial registration by itself. CDRV Investors, Inc. also will bear theregistration expenses (other than underwriting discounts) for two registrationson Form S-3 requested by certain co-investors of CD&R Fund VI,including the fees and expenses of counsel to the selling stockholders.

If CDRVInvestors, Inc. files a registration statement under the Securities Actwith respect to a public offering of its common stock, no holders of its commonstock will be permitted to effect any public sale or distribution of any sharesof such stock during the 20 days before and the 180 days (or, in the case of ashelf registration, 90 days) after the effective date of the registrationstatement (other than as part of the public offering).

***Participation Rights.***   Priorto the initial public offering of CDRV Investors, Inc., certain holders ofthe common stock of CDRV Investors, Inc. have the right to purchase, on apro rata basis, additional shares of its common stock if CD&R Fund VI orany other investment vehicle managed by CD&R subscribes for additionalshares of common stock, excluding any issuances by way of dividends ordistributions on in kind, or stock splits, reclassifications, recapitalizationsor consolidations.

***Tag-Along Rights.***   Priorto such time as a public market has been established for 20% or more of thecommon stock of CDRV Investors, Inc., certain holders of common stock ofCDRV Investors, Inc. other than CD&R Fund VI have the right toparticipate, on a pro rata basis and subject to the same terms and conditions,in any sale by CD&R Fund VI of more than 10% of its shares of common stockto a third party purchaser or to CDRV Investors, Inc.

***Drag-Along Right.***   Priorto such time as a public market has been established for 20% or more of thecommon stock of CDRV Investors, Inc., if CD&R Fund VI intends to sell morethan 50% of its shares of common stock of CDRV Investors, Inc. to a third partypurchaser, CD&R Fund VI will have the right to require certain otherholders of common stock to participate in such sale, on a pro rata basis andsubject to the same terms and conditions.

103

----

**ITEM14.**         PRINCIPAL ACCOUNTANT FEESAND SERVICES

KPMGLLP served as the Company’s independent auditor for the fiscal years ended December 31,2005 and 2004. Fees and expenses for services rendered by KPMG in 2005 and 2004were approved by our Audit Committee. KPMG’s fees and expenses for servicesrendered to the Company for the past two fiscal years are set forth in thetable below. We have determined that the provision of these services iscompatible with maintaining the independence of our independent auditors.

| **Type of Fees** | ** ** | ** **                           | ** ** | **2005** | ** ** | **2004** | ** ** |
|----------------------------|------------|--------------------------------------|------------|----------|------------|----------|------------|
| ** **                 | ** ** | **(dollars in thousands)** | ** ** |
| Audit Fees(1)              |       | $2,088                               |       | $        | 1,725      |     |
| Audit-Related Fees(2)      |       | —                               |       | 701      |       |
| Tax Fees(3)                |       | 52                                   |       | 30       |       |
| TOTAL FEES                 |       | $2,140                               |       | $        | 2,456      |     |

----

(1)          2005and 2004 audit fees relate to the audit of VWR International, Inc.’sglobal operations including statutory audits. Also included herein are feesrelated to various employee benefit plan audits.

(2)          2004audit-related services include procedures performed in connection with the April 2004Offering Memorandum and an S-4 Registration Statement.

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

**Pre-ApprovalPolicy for Auditor Services**

The Audit Committee hasadopted a policy that requires it to pre-approve the audit and non-auditservices performed by VWR’s auditor in order to assure that providing suchservices will not impair the auditor’s independence.

The Audit Committee hasthe sole and direct responsibility and authority for the appointment,termination and compensation to be paid to the independent accountants. TheCommittee has the responsibility to approve, in advance of the provisionthereof, all audit services and permissible non-audit services to be performedby the independent accountants as well as compensation to be paid with respectto such services.

Our Audit CommitteeCharter authorizes the Committee to delegate authority to pre-approve audit andpermissible non-audit services to a member of the Committee. Any decisions madeby such member under delegated authority, must be presented to the full Committeeat its next scheduled meeting.

104

----

**PART IV**

**ITEM 15.**         EXHIBITSAND FINANCIAL STATEMENT SCHEDULES

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

1.                 Thefollowing financial statements, together with the Report of IndependentRegistered Public Accountants and Notes to Consolidated Financial Statements,are filed as part of this report:

|                                                                                                                                                                                                                                                  | ** ** | **Page** | ** ** |
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|----------|------------|
| **VWR INTERNATIONAL, INC.  (Predecessor and Successor)**                                                                                                                                                                                         |       |     |       |   |   |
| Report of  Independent Registered Public Accounting Firm                                                                                                                                                                                         |       |     | 39         |   |   |
| Consolidated  Balance Sheets as of December 31, 2005 and 2004                                                                                                                                                                               |       |     | 40         |   |   |
| Consolidated  Statements of Operations for the year ended December 31, 2005, the  periods included in the year ended December 31, 2004 and the year ended  December 31, 2003                                                      |       |     | 41         |   |   |
| Consolidated Statements  of Stockholders’ Equity and other Comprehensive Income (Loss) for the year  ended December 31, 2005, the periods included in the year ended  December 31, 2004 and the year ended December 31, 2003 |       |     | 42         |   |   |
| Consolidated  Statements of Cash Flows for the year ended December 31, 2005, the  periods included in the year ended December 31, 2004 and the year ended  December 31, 2003                                                      |       |     | 44         |   |   |
| Notes to  Consolidated Financial Statements                                                                                                                                                                                                      |       |     | 45         |   |   |
| Schedule II—Valuation  and Qualifying Accounts for the year ended December 31, 2005, the  periods included in the year ended December 31, 2004 and the year ended  December 31, 2003.                                        |       |     | 112        |   |   |

 
| Exhibit    Number | ** ** | **Description of Documents**                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | ** ** | **Method of Filing**                                                                                    |
|------------------------|------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|------------|---------------------------------------------------------------------------------------------------------|
|  3.1              |       | Certificate of  Incorporation of VWR International, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |       | Previously filed as  Exhibit 3.1 to Annual Report on Form 10-K, filed on  April 6, 2005. |
|  3.2              |       | Amended and Restated  Bylaws of VWR International, Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |       | Previously filed as  Exhibit 3.2 to Annual Report on Form 10-K, filed on  April 6, 2005. |
|  4.1              |       | Credit Agreement, dated  as of April 7, 2004, among CDRV Acquisition Corporation (the rights and  obligations of which thereunder were assumed by VWR  International, Inc.), the Foreign Subsidiary Borrowers from time to time  parties thereto, the several Lenders from time to time parties thereto,  Deutsche Bank AG, New York Branch, as Administrative Agent, Citicorp North  America, Inc., as Syndication Agent, and Bank of America, N.A., BNP  Paribas and Barclays Bank PLC, as Documentation Agents. |       | Previously filed as  Exhibit 4.1 to Form S-4, filed on August 30, 2004.                  |
|  4.2              |       | Assumption Agreement,  dated as of April 7, 2004, between CDRV Acquisition Corporation and VWR  International, Inc.                                                                                                                                                                                                                                                                                                                                                                                                     |       | Previously filed as  Exhibit 4.2 to Form S-4, filed on August 30, 2004.                  |

105

----

 
|  4.3  |   | Guarantee and Collateral  Agreement, dated as of April 7, 2004, made by CDRV Holdings, Inc.,  CDRV Acquisition Corporation (the rights and obligations of which were  assumed by VWR International, Inc.) and certain of its Subsidiaries in  favor of Deutsche Bank AG, New York Branch, as Administrative Agent.         |   | Previously filed as  Exhibit 4.3 to Form S-4, filed on August 30, 2004.                             |
|------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------|
| 4.4        |   | Indenture, dated as of  April 7, 2004, by and among CDRV Acquisition Corporation, as Issuer, the  Subsidiary Guarantors from time to time parties thereto, as Subsidiary  Guarantors and Wells Fargo Bank, National Association, as Trustee, relating  to the 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.     |   | Previously filed as  Exhibit 4.4 to Form S-4, filed on August 30, 2004.                             |
| 4.5        |   | Indenture, dated as of  April 7, 2004, by and among CDRV Acquisition Corporation, as Issuer, the  Subsidiary Guarantors from time to time parties thereto, as Subsidiary  Guarantors and Wells Fargo Bank, National Association, as Trustee, relating  to the 8% Senior Subordinated Notes due 2014 of CDRV Acquisition Corporation. |   | Previously filed as  Exhibit 4.5 to Form S-4, filed on August 30, 2004.                             |
|  4.6  |   | Supplemental Indenture,  dated as of April 7, 2004, among VWR International, Inc. and Wells  Fargo Bank, National Association, as Trustee, relating to the 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.                                                                                                   |   | Previously filed as  Exhibit 4.6 to Form S-4, filed on August 30, 2004.                             |
|  4.7  |   | Supplemental Indenture,  dated as of April 7, 2004, among VWR International, Inc., and Wells  Fargo Bank, National Association, as Trustee, relating to the 8% Senior  Subordinated Notes due 2014 of CDRV Acquisition Corporation.                                                                                             |   | Previously filed as  Exhibit 4.7 to Form S-4, filed on August 30, 2004.                             |
|  4.8  |   | Form of 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.                                                                                                                                                                                                                                                           |   | Previously filed as  Exhibit 4.10 to Form S-4, filed on August 30, 2004.                            |
|  4.9  |   | Form of 8% Senior  Subordinated Notes due 2014 of CDRV Acquisition Corporation.                                                                                                                                                                                                                                                      |   | Previously filed as  Exhibit 4.11 to Form S-4, filed on August 30, 2004.                            |
|  4.10 |   | Supplemental Indenture,  dated as of April 7, 2004, among VWR International, Inc. and Wells  Fargo Bank, National Association, as Trustee, relating to the 67¤8%  Senior Notes due 2012 of CDRV Acquisition Corporation.                                                                                                   |   | Previously filed as  Exhibit 4.12 to Amendment No. 2 to Form S-4, filed on  November 19, 2004. |

106

----

 
|  4.11 |   | Supplemental Indenture,  dated as of April 7, 2004, among VWR International, Inc. and Wells  Fargo Bank, National Association, as Trustee, relating to the 8% Senior  Subordinated Notes due 2014 of CDRV Acquisition Corporation.                                                         |   | Previously filed as Exhibit 4.13  to Amendment No. 2 to Form S-4, filed on November 19,  2004. |
|------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------|
| 10.1       |   | Consulting Agreement,  dated as of April 7, 2004, by and among CDRV Investors, Inc., CDRV  Holdings, Inc., CDRV Acquisition Corporation, CDRV Delaware, Inc.  and Clayton, Dubilier & Rice, Inc.                                                                   |   | Previously filed as  Exhibit 10.1 to Form S-4, filed on August 30, 2004.                            |
| 10.2       |   | Loanout Agreement, dated  as of May 15, 2005, by and among CDRV Investors, Inc., CDRV  Holdings, Inc., VWR International, Inc. and Clayton,  Dubilier & Rice, Inc.                                                                                                 |   | Previously filed as  Exhibit 99.1 to Form 8-K, filed on May 15, 2005.                               |
| 10.3       |   | Indemnification  Agreement, dated as of April 7, 2004, among CDRV Investors, Inc.,  CDRV Holdings, Inc., CDRV Acquisition Corporation, CDRV  Delaware, Inc., Clayton, Dubilier & Rice, Inc. and  Clayton, Dubilier & Rice Fund VI Limited Partnership.    |   | Previously filed as  Exhibit 10.2 to Form S-4, filed on August 30, 2004.                            |
| 10.4       |   | Registration and  Participation Agreement, dated as of April 7, 2004, among CDRV  Investors, Inc., Clayton, Dubilier & Rice Fund VI Limited  Partnership, Banc of America Capital Investors, L.P., SSB Capital Partners  (Master Fund) I, L.P., and CGI Private Equity L.P., LLC. |   | Previously filed as  Exhibit 10.3 to Form S-4, filed on August 30, 2004.                            |
| 10.5       |   | Stock Subscription Agreement,  dated April 7, 2004, between CDRV Investors, Inc. and Clayton,  Dubilier & Rice Fund VI Limited Partnership.                                                                                                                                       |   | Previously filed as  Exhibit 10.4 to Form S-4, filed on August 30, 2004.                            |
| 10.6       |   | VWR  International, Inc. Directors Compensation Policy*                                                                                                                                                                                                                                         |   | Previously filed as  Exhibit 10.5 to Form S-4, filed on August 30, 2004.                            |
| 10.7       |   | CDRV  Investors, Inc. Stock Incentive Plan*                                                                                                                                                                                                                                                     |   | Previously filed as  Exhibit 10.6 to Form S-4, filed on August 30, 2004.                            |
| 10.8       |   | Form of Employee  Stock Subscription Agreement*                                                                                                                                                                                                                                                 |   | Previously filed as  Exhibit 10.7 to Form S-4, filed on August 30, 2004.                            |
| 10.9       |   | Form Restricted  Stock Unit Agreement under CDRV Investors, Inc. Stock Incentive Plan*                                                                                                                                                                                                     |   | Previously filed as  Exhibit 99.2 to Form 8-K, filed on February 23, 2006.                          |
| 10.10      |   | Form of Stock  Option Agreement*                                                                                                                                                                                                                                                                |   | Previously filed as  Exhibit 10.8 to Form S-4, filed on August 30, 2004.                            |

107

----

 
| 10.11 |   | Pension Contract for  Walter Zywottek*                                                                                        |   | Previously filed as  Exhibit 10.9 to Form S-4, filed on August 30, 2004.   |
|-------|--------|-------------------------------------------------------------------------------------------------------------------------------|--------|-------------------------------------------------------------------------------------------|
| 10.12 |   | VWR  International, Inc. Retirement Plan*                                                                                |   | Previously filed as  Exhibit 10.10 to Form S-4, filed on August 30, 2004.  |
| 10.13 |   | VWR Corporation  Supplemental Benefits Plan*                                                                                  |   | Previously filed as  Exhibit 10.11 to Form S-4, filed on August 30, 2004.  |
| 10.14 |   | Employment Agreement,  among VWR International Inc and John M. Ballbach.*                                                     |   | Previously filed as  Exhibit 99.2 to Form 8-K, filed on October 19, 2005.  |
| 10.15 |   | Amendment to Employment  Agreement among VWR International Inc. and John Ballbach *                                           |   | Previously filed as  Exhibit 99.1 to Form 8-K, filed on February 23, 2006. |
| 10.16 |   | Employment Agreement,  among VWR International Inc. and Walter Zywottek*                                                      |   | Previously filed as  Exhibit 10.12 to Form S-4, filed on August 30, 2004.  |
| 10.17 |   | Employment Agreement,  among VWR International Inc. and Jack Wyszomierski*                                                    |   | Previously filed as  Exhibit 10.13 to Form S-4, filed on August 30, 2004.  |
| 10.18 |   | Employment Agreement,  among VWR International Inc. and Edward H. Orzetti*                                                    |   | Previously filed as  Exhibit 10.14 to Form S-4, filed on August 30, 2004.  |
| 10.19 |   | Letter Agreement, among  VWR International Inc. and Edward Orzetti.*                                                          |   | Previously filed as  Exhibit 99.1 to Form 8-K, filed on January 11, 2006.  |
| 10.20 |   | Employment Agreement,  among VWR International Inc. and Charles F. Canfield*                                                  |   | Previously filed as  Exhibit 10.17 to Form S-4, filed on August 30, 2004.  |
| 10.21 |   | Employment Agreement,  among VWR International Inc. and Ted Pulkownik*                                                        |   | Previously filed as  Exhibit 10.18 to Form S-4, filed on August 30, 2004.  |
| 10.22 |   | Employment Agreement,  among VWR International Inc. and Stephen J. Kunst*                                                     |   | Previously filed as  Exhibit 10.19 to Form S-4, filed on August 30, 2004.  |
| 10.23 |   | Letter of Employment for  Stephen J. Kunst*                                                                                   |   | Previously filed as  Exhibit 10.20 to Form S-4, filed on August 30, 2004.  |
| 12.1  |   | Computation of Ratio of  Earnings to Fixed Charges.                                                                           |   | Filed herewith.                                                                           |
| 21.1  |   | List of subsidiaries.                                                                                                         |   | Previously filed as  Exhibit 21.1 to Form S-4, filed on August 30, 2004.   |
| 31.1  |   | Certification of  Principal Executive Officer pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                |   | Filed herewith.                                                                           |
| 31.2  |   | Certification of  Principal Financial Officer pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002.                |   | Filed herewith.                                                                           |
| 32.1  |   | Certificate of Principal  Executive Officer pursuant to 18 U.S.C. 1350 (Section 906 of the  Sarbanes-Oxley Act of 2002). |   | Furnished herewith.                                                                       |

108

----

 
| 32.2 |   | Certificate of Principal  Financial Officer pursuant to 18 U.S.C. 1350 (Section 906 of the  Sarbanes-Oxley Act of 2002). |   | Furnished herewith. |
|------|--------|-------------------------------------------------------------------------------------------------------------------------------|--------|---------------------|

 

----

*              Denotes management contract or compensatory plan,contract or arrangement.

**SUPPLEMENTAL INFORMATION**

The Company is an indirect wholly-owned subsidiary ofCDRV Investors, Inc. No annual report to security holders covering theCompany’s last fiscal year or proxy statement, form of proxy or other proxysoliciting material has been sent to security holders.

109

----

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

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

 

Pursuant to therequirements of the Securities Exchange Act of 1934, this report has been signedby the following persons on behalf of the registrant and in the capacities andon the dates indicated.

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

110

----

 

| /s/ RICHARD J. SCHNALL |   | Director |   | March 31, 2006 |
|------------------------|--------|----------|--------|---------------------|
| Richard J.  Schnall    |   |     |   |                |
| /s/  CARL T. STOCKER   |   | Director |   | March 31, 2006 |
| Carl T. Stocker        |   |     |   |                |
| /s/  ROBERT J. ZOLLARS |   | Director |   | March 31, 2006 |
| Robert J. Zollars      |   |     |   |                |

 

 

111

----

**Schedule II - Valuation of Qualifying Accounts**

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

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

 

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

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

----

(1)          Bad debts charged off,less recoveries.

112

----