EXECUTION COPY









Exhibit 10.1




 




EXECUTION COPY




POST-CLOSING COVENANTS AGREEMENT dated as of November 21,

2001 among JOHNSON & JOHNSON, a New Jersey corporation (“Parent”),

INVERNESS MEDICAL TECHNOLOGY, INC., a Delaware corporation (the “Company”), the

subsidiaries of the Company party hereto (together with the Company, the

“Sunrise Companies”), INVERNESS MEDICAL INNOVATIONS, INC., a Delaware

corporation (“Newco”), and the subsidiaries of Newco party hereto (the “Newco

Subsidiary Indemnitors”).




 




WHEREAS,

Parent, SUNRISE ACQUISITION CORP., a Delaware corporation and a wholly owned

subsidiary of Parent (“Sub”), and the Company have entered into an Agreement

and Plan of Split-Off and Merger dated as of May 23, 2001 (the “Merger

Agreement”), providing for the Merger (as defined in the Merger Agreement) of

Sub with and into the Company, with the Company as the surviving corporation;




 




WHEREAS,

the Board of Directors of the Company has approved a Restructuring Agreement in

the form of Annex A to the Merger Agreement (the “Restructuring

Agreement”), which will be entered into prior to the Effective Time (as defined

in the Merger Agreement), pursuant to which prior to the Effective Time, among

other things (a) all the assets of the Company primarily related to the Newco

Business (as defined in the Restructuring Agreement) will be transferred to

Newco or one or more of Newco’s subsidiaries and (b) Newco or one or more

of its subsidiaries will assume the Assumed Liabilities (as defined in the

Restructuring Agreement);




 




WHEREAS,

the execution and delivery of this Agreement by the parties hereto is a

condition to the obligations of the parties to the Merger Agreement to

consummate the Merger; and




 




WHEREAS, the parties to this Agreement have

determined that it is necessary and desirable to set forth certain agreements

that will govern certain matters that may arise following the Effective Time.




 




NOW, THEREFORE, in consideration of the

foregoing, and the representations, warranties, covenants and agreements

contained in this Agreement, the parties hereto hereby agree as follows:




 





























 




ARTICLE

I




 




DEFINITIONS




 




SECTION 1.01.      Definitions. 

Terms used but not defined in this Agreement shall have the meanings set

forth in the Merger Agreement or, if not set forth in the Merger Agreement, in

the Restructuring Agreement. In addition, the following terms shall have the

following meanings:




 




“Affiliate” of any person means another

person that directly or indirectly, through one or more intermediaries,

controls, is controlled by, or is under common control with, such first person;

provided, however, that for the purposes of this Agreement, from

and after the Effective Time, none of the Sunrise Companies shall be deemed to

be an Affiliate of any Newco Company and none of the Newco Companies shall be

deemed to be an affiliate of any Sunrise Company.




 




“Filings” shall mean the Parent Form S–4,

the Newco Form S–4, the Form 8–A and any other document filed or required to be

filed with the SEC in connection with the transactions contemplated by the

Transaction Agreements, or any preliminary or final form thereof or any

amendment or supplement thereto.




 




“Indemnifiable Losses” shall mean, subject

to Section 2.04, all losses, liabilities, damages, deficiencies,

obligations, fines, expenses, claims, demands, actions, suits, proceedings,

judgments or settlements, whether or not resulting from Third Party Claims,

including interest and penalties recovered by a third party with respect

thereto and out-of-pocket expenses and reasonable attorneys’ and accountants’ fees

and expenses incurred in the investigation or defense of any of the same or in

asserting, preserving or enforcing any of the Indemnitee’s rights hereunder,

suffered or incurred by an Indemnitee.




 




“Indemnitee”

shall mean any of the Parent Indemnitees or the Newco Indemnitees, as the case

may be, who or which may seek indemnification under this Agreement.




 




“Newco

Indemnitees” shall mean Newco, each Affiliate of Newco, including any of its

direct or indirect subsidiaries, each of their respective Representatives and

each of the heirs, executors, successors and assigns of any of the foregoing.




 




“Newco

Subsidiary Indemnitors” shall have the meaning set forth in the preamble

hereto.




 




 




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“Newco

Recourse Right” shall have the meaning set forth in Section 3.07(a)

hereto.




 




“Parent

Indemnitees” shall mean Parent, each Affiliate of Parent, including any of its

direct or indirect subsidiaries (including, after the Effective Time, the

Sunrise Companies), each of their respective Representatives and each of the

heirs, executors, successors and assigns of any of the foregoing.




 




“Sunrise

Recourse Right” shall have the meaning set forth in Section 3.07(b)

hereto.




 




“Third

Party Claims” shall have the meaning set forth in Section 2.04(a).




 




ARTICLE

II




 




INDEMNIFICATION




 




SECTION 2.01.      Indemnification by Newco and the Newco Subsidiary

Indemnitors.  Subject to the

provisions of this Article II, Newco and the applicable Newco Subsidiary

Indemnitors, as described below, shall jointly and severally indemnify, defend

and hold harmless the Parent Indemnitees from and against, and pay or reimburse

the Parent Indemnitees for, all Indemnifiable Losses, as incurred:




 




(i)            relating to or arising from the

Newco Business, the Newco Assets or the Assumed Liabilities (including the

failure by Newco or any Newco Company to pay, perform or otherwise discharge

any of the Assumed Liabilities in accordance with their terms), whether such

Indemnifiable Losses relate to or arise from events, occurrences, actions,

omissions, facts or circumstances occurring, existing or asserted before, at or

after the Effective Time;




 




(ii)           relating to or arising from any

untrue statement or alleged untrue statement of a material fact relating to any

Newco Company contained in any of the Filings, or any omission or alleged

omission to state therein a material fact relating to any Newco Company

required to be stated therein or necessary to make the statements therein, in

light of the circumstances under which they were made, not misleading, but only

with respect to statements made therein or incorporated by reference therein

based upon information supplied by Newco or any Newco Company




 




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specifically for inclusion or incorporation

by reference therein;




 




(iii)          relating to or arising from the breach

by any Newco Company of any agreement or covenant contained in any Transaction

Agreement which is to be performed or complied with after the Effective Time;

or 




 




(iv)          relating to or arising from the

matters set forth on Schedule 2.01(iv) hereto;




 




provided,

however, that notwithstanding the foregoing each Newco Subsidiary

Indemnitor shall only be liable for Indemnifiable Losses (A) in the case

of clause (i) of this Section 2.01, relating to or arising from

(x) the Newco Business conducted by such Newco Subsidiary Indemnitor

before, at or after the Effective Time, (y) the assets used, held for use

or intended for use in the Newco Business conducted by such Newco Subsidiary Indemnitor

and (z) the liabilities of or attributable to the Newco Business of such

Newco Subsidiary Indemnitor or such Newco Subsidiary Indemnitor and (B) in

the case of clause (iii) of this Section 2.01, relating to or arising

from a breach by such Newco Subsidiary Indemnitor.




 




SECTION 2.02.      Indemnification by the Sunrise Companies.  Subject to the provisions of this

Article II, the Sunrise Companies shall jointly and severally indemnify,

defend and hold harmless the Newco Indemnitees from and against, and pay or

reimburse the Newco Indemnitees for:




 




(i)            all Indemnifiable Losses, as

incurred, relating to or arising from the Sunrise Business, the Sunrise Assets

or the Sunrise Liabilities (including the failure by any Sunrise Company to

pay, perform or otherwise discharge any of the Sunrise Liabilities in

accordance with their terms), whether such Indemnifiable Losses relate to or

arise from events, occurrences, actions, omissions, facts or circumstances

occurring, existing or asserted before, at or after the Effective Time; or




 




(ii)           all Indemnifiable Losses, as incurred

(together with interest thereon at a rate equal to 15% per annum calculated

from the date written notice of a claim for indemnification relating to such

Indemnifiable Losses is delivered to the Company, but in no event prior to the

Effective Time), relating to or arising from the breach by any Sunrise Company

of any agreement or covenant contained in any Transaction




 




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Agreement which is to be performed or complied

with after the Effective Time;




 




provided, however, that notwithstanding the foregoing each

Sunrise Company that is a subsidiary of the Company shall only be liable for

Indemnifiable Losses (A) in the case of clause (i) of this

Section 2.02, relating to or arising from (x) the assets used, held

for use or intended for use in the Sunrise Business conducted by such Sunrise

Company and (y) the liabilities of or attributable to the Sunrise Business

of such Sunrise Company and (B) in the case of clause (ii) of this

Section 2.02, relating to or arising from a breach relating to such

Sunrise Company.




 




In

the event the Company transfers any material portion of its assets, in a single

transaction or in a series of transactions, Parent promptly will either guarantee

the indemnification obligations referred to in Section 2.02(i) or take

such other action to insure that the ability of the Company, legal and

financial, to satisfy such indemnification obligations will not be diminished

in any material respect.




 




SECTION

2.03.      Indemnification by Parent.  Subject to the provisions of this

Article II, Parent shall indemnify, defend and hold harmless the Newco

Indemnitees from and against, and pay or reimburse the Newco Indemnitees for:




 




(i)            all Indemnifiable Losses, as incurred,

relating to or arising from any untrue statement or alleged untrue statement of

a material fact contained in any of the Filings, or any omission or alleged

omission to state therein a material fact required to be stated therein or

necessary to make the statements therein, in light of the circumstances under

which they were made, not misleading, but only with respect to statements made

therein or incorporated by reference therein based upon information supplied by

Parent specifically for inclusion or incorporation by reference therein; or




(ii)           all

Indemnifiable Losses, as incurred (together with interest thereon at a rate

equal to 15% per annum calculated from the date written notice of a claim for

indemnification relating to such Indemnifiable Losses is delivered to the

Company, but in no event prior to the Effective Time), relating to or arising

from the breach by any Sunrise Company of any agreement or covenant contained

in any Transaction




 




 




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Agreement

which is to be performed or complied with after the Effective Time.




 




SECTION

2.04.      Procedures Relating to

Indemnification.  (a)   In order for an Indemnitee to be entitled to

any indemnification provided for under this Agreement in respect of, arising out

of or involving a claim made by any Person who is not an Indemnitee against the

Indemnitee (a “Third Party Claim”), such Indemnitee must notify the party who

may become obligated to provide indemnification hereunder (the “Indemnifying

Party”) in writing, and in reasonable detail, of the Third Party Claim

reasonably promptly, and in any event within 20 business days after

receipt by such Indemnitee of written notice of the Third Party Claim; provided,

however, that failure to give such notification shall not affect the

indemnification provided hereunder except to the extent the Indemnifying Party

shall have been actually and materially prejudiced as a result of such failure;

provided  further, however, that with respect to any Third

Party Claim for which Newco or any Newco Subsidiary Indemnitor is the

Indemnifying Party, such Indemnifying Party shall be deemed to have received

notice with respect to such Third Party Claim by or against any Sunrise Company

for which the Company received notice prior to the Effective Time.  After any required notification (if

applicable), the Indemnitee shall deliver to the Indemnifying Party, promptly

after the Indemnitee’s receipt thereof, copies of all notices and documents

(including court papers) received by the Indemnitee relating to the Third Party

Claim.




 




(b)           If a Third Party Claim is made

against an Indemnitee, the Indemnifying Party will be entitled to participate

in the defense thereof and, if it so chooses, to assume the defense thereof (at

the expense of the Indemnifying Party) with counsel selected by the

Indemnifying Party and reasonably satisfactory to the Indemnitee.  Should the Indemnifying Party so elect to

assume the defense of a Third Party Claim, the Indemnifying Party will not be

liable to the Indemnitee for any legal expenses subsequently incurred by the

Indemnitee in connection with the defense thereof.  If the Indemnifying Party assumes such defense, the Indemnitee

shall have the right to participate in the defense thereof and to employ

counsel, at its own expense, separate from the counsel employed by the

Indemnifying Party, it being understood that the Indemnifying Party shall

control such defense.  The Indemnifying

Party shall be liable for the reasonable fees and expenses of counsel employed

by the Indemnitee for any period during which the Indemnifying Party has not

assumed the defense thereof (other than during any period in which




 




 




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the

Indemnitee shall have failed to give notice of the Third Party Claim as

provided above).  Notwithstanding the

foregoing, the Indemnifying Party shall not be entitled to assume the defense

of any Third Party Claim (and shall be liable for the reasonable fees and

expenses of counsel incurred by the Indemnitee in defending such Third Party

Claim) if the Third Party Claim seeks an order, injunction or other equitable

relief or relief for other than money damages against the Indemnitee which the

Indemnitee reasonably determines, after conferring with its counsel, cannot be

separated from any related claim for money damages. The indemnification

required by Section 2.01, 2.02 or 2.03, as the case may be, shall be made

by periodic payments of the amount thereof during the course of the

investigation or defense, as and when bills are received or the Indemnifiable

Loss is incurred.  If the Indemnifying

Party chooses to defend or prosecute a Third Party Claim, all the parties

hereto reasonably necessary for such defense or prosecution shall cooperate in

the defense or prosecution thereof, which cooperation shall include the

retention in accordance with the Restructuring Agreement and (upon the

Indemnifying Party’s request) the provision to the Indemnifying Party of

records and information which are reasonably relevant to such Third Party

Claim, and making employees available on a mutually convenient basis to provide

additional information and explanation of any material provided hereunder.  If the Indemnifying Party chooses to defend

or prosecute any Third Party Claim, the Indemnitee will agree to any

settlement, compromise or discharge of such Third Party Claim which the

Indemnifying Party may recommend and which by its terms obligates the

Indemnifying Party to pay the full amount of liability in connection with such

Third Party Claim; provided, however, that, without the

Indemnitee’s consent, the Indemnifying Party shall not consent to entry of any

judgment or enter into any settlement (x) that provides for injunctive or

other nonmonetary relief affecting the Indemnitee or (y) that does not

include as an unconditional term thereof the giving by each claimant or

plaintiff to such Indemnitee of a release from all liability with respect to

such claim.  If the Indemnifying Party

shall have assumed the defense of a Third Party Claim, the Indemnitee shall not

admit any liability with respect to, or settle, compromise or discharge, such

Third Party Claim without the Indemnifying Party’s prior written consent (which

consent shall not be unreasonably withheld).




 




(c)           In order for an Indemnitee to be

entitled to any indemnification provided for under this Agreement in respect of

a claim that does not involve a Third Party Claim, the Indemnitee shall deliver

notice of such claim (in




 




 




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reasonably

sufficient detail to enable the Indemnifying Party to evaluate such claim) with

reasonable promptness to the Indemnifying Party.  The failure by any Indemnitee so to notify the Indemnifying Party

shall not relieve the Indemnifying Party from any liability which it may have

to such Indemnitee under this Agreement, except to the extent that the

Indemnifying Party shall have been actually and materially prejudiced by such

failure.  If the Indemnifying Party does

not notify the Indemnitee within 20 business days following its receipt of

such notice that the Indemnifying Party disputes its liability with respect to

such claim under Section 2.01, 2.02 or 2.03, as the case may be, the claim

shall be conclusively deemed a liability of the Indemnifying Party under Section 2.01,

2.02 or 2.03, as the case may be, and the Indemnifying Party shall pay the

amount of such liability to the Indemnitee on demand or, in the case of any

notice in which the amount of the claim (or any portion thereof) is estimated,

on such later date when the amount of such claim (or such portion thereof)

becomes finally determined.  If the

Indemnifying Party has timely disputed its liability with respect to such

claim, as provided above, the Indemnifying Party and the Indemnitee shall

proceed in good faith to negotiate a resolution of such dispute and, if not

resolved through negotiations, such dispute shall be resolved by litigation in

an appropriate court of competent jurisdiction.




 




(d)           The parties hereto agree that Newco

shall be the representative of the Newco Subsidiary Indemnitors for all

purposes of this Section 2.04, and as such all deliveries, notices and

other communications made or delivered to Newco shall also be deemed to have

been made or delivered to the Newco Subsidiary Indemnitors, and all elections,

selections of counsel, choices, agreements and consents made or delivered by

Newco shall be deemed to have also been made or delivered by the applicable

Newco Subsidiary Indemnitors, and shall be binding thereon.  Notwithstanding the foregoing, the parties

hereto agree that nothing contained in this Section 2.04(d) shall in any

manner affect, limit or impair the rights of the Parent Indemnitees to

indemnification from Newco or any Newco Subsidiary Indemnitor pursuant to

Section 2.01.




 




(e)           The parties hereto agree that the

Company shall be the representative of the Sunrise Companies for all purposes

of this Section 2.04, and as such all deliveries, notices and other

communications made or delivered to the Company shall also be deemed to have

been made or delivered to the Sunrise Companies, and all elections, selections

of counsel, choices, agreements and consents made or delivered by the Company

shall be deemed to have also been made or




 




 




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delivered

by the applicable Sunrise Company, and shall be binding thereon.  Notwithstanding the foregoing, the parties

hereto agree that nothing contained in this Section 2.04(e) shall in any

manner affect, limit or impair the rights of the Newco Indemnitees to

indemnification from any Sunrise Company pursuant to Section 2.02.




 




SECTION 2.05.  Certain Limitations. 

(a)     The amount of any

Indemnifiable Losses or other liability for which indemnification is provided

under this Agreement shall be net of any amounts actually recovered by the

Indemnitee from third parties (including, without limitation, amounts actually

recovered under insurance policies) with respect to such Indemnifiable Losses.




 




(b)           All indemnification payments

under this Agreement shall be (i) increased to take account of any net tax

cost incurred by the Indemnitee arising from the receipt of indemnification

payments hereunder (grossed up for such increase) and (ii) reduced to take

account of any net tax benefit realized by the Indemnitee arising from the

incurrence or payment of any Indemnifiable Loss.  In computing the amount of any such tax cost or tax benefit, the

Indemnitee shall be deemed to recognize all other items of income, gain, loss

deduction or credit before recognizing any item arising from the receipt of any

indemnification payment hereunder or the incurrence or payment of any

Indemnifiable Loss.




 




SECTION

2.06.      Exclusivity of Tax

Allocation Agreement. 

Notwithstanding anything in this Agreement to the contrary, the Tax

Allocation Agreement shall be the exclusive agreement among the parties with

respect to all Tax matters, including indemnification in respect of Tax

matters.




 




SECTION

2.07.      Production of Witnesses;

Records; Cooperation.  After the

Effective Time, except (i) in the case of a dispute between Parent or a Sunrise

Company, on the one hand, and a Newco Company, on the other hand, and (ii) for

Third Party Claims that the Indemnifying Party participates in the defense or

prosecution of pursuant to Section 2.04(b) hereof (in which case the relevant

provisions of such Section will apply), each party hereto shall use

commercially reasonable efforts to make available to each other party, upon

written request, the former, current and future directors, officers, employees,

other personnel and agents of such party as witnesses and any books, records or

other documents within its control or which it otherwise has the ability to

make available, to the extent that any such person (giving consideration to




 




 




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business

demands of such directors, officers, employees, other personnel and agents) or

books, records or other documents may reasonably be required in connection with

any demand, action, suit, countersuit, arbitration, inquiry, proceeding or

investigation by or before any federal, state, local, foreign or international

governmental authority or any arbitration or mediation tribunal (“Action”) in

which the requesting party may from time to time be involved, regardless of

whether such Action is a matter with respect to which indemnification may be

sought hereunder.  The requesting party

shall bear all reasonable costs and expenses (including reasonable allocated

costs of in-house personnel) in connection therewith unless such costs and

expenses are otherwise subject to indemnification of the requesting party by

the producing party.




 




ARTICLE

III




 




OTHER

AGREEMENTS




 




SECTION 3.01.      Insurance.  (a)       In the event that any Sunrise Asset

suffers any damage, destruction or other casualty loss, Newco shall, or shall

cause a Newco Company to, surrender to Parent (i) all insurance proceeds

received with respect to such damage, destruction or loss and (ii) all

rights of the Newco Companies with respect to any causes of action in

connection with such damage, destruction or loss.  Newco shall, and shall cause each Newco subsidiary to, make

available to the Sunrise Companies the benefit of any workers’ compensation,

general liability, product liability, automobile liability, umbrella (excess)

liability or crime or other insurance policy covering or relating to the

Sunrise Business, the Sunrise Assets or the Sunrise Liabilities.  The Newco Companies shall promptly pay to

Parent all insurance proceeds relating to the Sunrise Business, the Sunrise

Assets or the Sunrise Liabilities received by any Newco Company under any

insurance policy.  Nothing in this

Section 3.01 shall reduce, limit or otherwise affect the right of Newco to

seek or obtain insurance proceeds with respect to any damage, destruction or

loss to or of a Newco Asset, nor shall anything in this Section 3.01

reduce, limit or otherwise affect any of the rights of Parent or any Parent

Indemnitee set forth in Article II.




 




(b)           In the event that any Newco Asset

suffers any damage, destruction or other casualty loss, the Company shall, or

shall cause a Sunrise Company to, surrender to Newco (i) all insurance

proceeds received with respect to such damage, destruction or loss and

(ii) all rights of the




 




 




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Sunrise Companies

with respect to any causes of action in connection with such damage,

destruction or loss.  The Company shall,

and shall cause each of its subsidiaries to, make available to the Newco

Companies the benefit of any workers’ compensation, general liability, product

liability, automobile liability, umbrella (excess) liability or crime or other

insurance policy covering or relating to the Newco Business, the Newco Assets

or the Assumed Liabilities.  The Sunrise

Companies shall promptly pay to Newco all insurance proceeds relating to the

Newco Business, the Newco Assets or the Assumed Liabilities received by any

Sunrise Company under any insurance policy. 

Nothing in this Section 3.01 shall reduce, limit or otherwise

affect the right of the Company to seek or obtain insurance proceeds with

respect to any damage, destruction or loss to or of a Sunrise Asset, nor shall

anything in this Section 3.01 reduce, limit or otherwise affect the right

of the Company to seek or obtain insurance proceeds with respect to any damage,

destruction or loss to or of a Sunrise Asset, nor shall anything in this

Section 3.01 reduce, limit or otherwise affect any of the rights of Newco

or any Newco Indemnitee set forth in Article II.




 




SECTION

3.02.      Expenses.  Notwithstanding anything to the contrary set

forth in the Merger Agreement, the Company (and not Newco) shall be responsible

for and agrees to pay all expenses of the Company and its subsidiaries (before

giving effect to the Restructuring) directly related to the Restructuring, the

Split-Off and the Merger up to the amount set forth on Schedule 3.02 (a)

hereto, and Newco (and not the Company) shall be responsible for and agrees to

pay all expenses of the Company and its subsidiaries (before giving effect to

the Restructuring) in excess of such amount.




 




SECTION

3.03.      Characterization of

Payments.  The payments made

pursuant to this Agreement shall be treated as occurring immediately before the

Effective Time, and none of the Newco Companies, the Sunrise Companies and

Parent and its subsidiaries shall take any position inconsistent with such

treatment before any Taxing Authority, except to the extent that a Final

Determination (as defined in the Tax Allocation Agreement) with respect to the

recipient party causes any such payment to not be so treated.




 




SECTION

3.04.      Agreement Not to Compete;

Agreement Not to Solicit or Hire Employees.  (a)        Newco understands

that Parent shall be entitled to protect and preserve the going concern value

of the Sunrise Business to the extent permitted by law and that Parent would

not have entered into the Merger Agreement absent the provisions of this




 




 




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Section 3.04.  Newco acknowledges and agrees that the

purpose of this Section 3.04 is to exclude it, except as expressly provided

below, from the field of diabetes generally and specifically from competing

with the businesses of the Company and Parent’s LifeScan franchise relating to

the research, development, manufacturing, marketing and sale of test strips,

pumps and meters for a period of ten (10) years. Therefore, Newco agrees that,

commencing at the Effective Time and continuing until the date that is ten

years from the Effective Time, it shall not, and shall not permit any of its

Affiliates, in any manner, directly or indirectly, alone or in association with

any person, to:




 




(i)            compete

with Parent, the Company or any of their respective Affiliates in the field of

diabetes generally (including without limitation the testing, monitoring,

diagnosing, prognostication, treatment, management or cure of diabetes and

diabetes symptoms and conditions) (the “Diabetes Field”) (it being acknowledged

that the following shall not be deemed to be in the Diabetes Field: (x) such

activities with respect to cholesterol, creatinine and other similar analytes

used primarily with respect to diseases other than diabetes, (y) the

development and subsequent manufacture of prescription pharmaceutical products

(meaning products that are therapeutically active in  vivo) (other

than insulin) and the sale of such products (including the conversion of

pharmaceutical products developed by Newco to over-the-counter status), and (z)

development, manufacture, sale, servicing, use and licensing of Multi-Analyte

Systems as defined in the License Agreement);




 




(ii)           engage

in any activity in the Diabetes Field (including without limitation

researching, developing, manufacturing, marketing, selling, distributing or

licensing (to or from third parties) of technology or products or providing services

for the testing, monitoring, diagnosing, prognostication, treatment, management

or cure of diabetes and diabetes symptoms and conditions); or




 




(iii)          actively

participate in, control, manage, own any interest in or share in the earnings

of, finance or invest in the capital stock of any person who is engaged in any

activity in the Diabetes Field or, with the exception of Ernest Carabillo,

consult with any person on matters in the Diabetes Field except PPM Activities;

except that Newco and its subsidiaries




 




 




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in

the aggregate, and each other Affiliate of Newco may acquire:




 




(A)          an entity which participates in the

Diabetes Field if and only if at the time of the acquisition and during the 10

year period referred to above, (x) such entity’s activity in the Diabetes Field

is limited to the sale of products and services (as distinguished from the

licensing, distribution, manufacture, design, research or development of

products, technologies and services) and (y) the revenues derived from the sale

of such products and services (it being understood that such entity shall not

receive any royalty revenue from the Diabetes Field) constitute no more than 3%

of such entity’s total revenues; and




 




(B)           up to 2% of the equity or voting

interest in an entity that is engaged in activities in the Diabetes Field so

long as none of Ron Zwanziger, David Scott or Jerry McAleer is actively

involved, whether directly or indirectly, in the management of such entity

during the period of the applicable non-competition covenants set forth in

those certain Consulting and Noncompetition Agreements each dated the same date

as the Merger Agreement among Parent, the Company and such individual.




 




For

purposes of this Section 3.04, “actively involved” includes, without

limitation, acting directly or indirectly as an officer, director, proprietor,

employee, partner, lender, or, on matters in the Diabetes Field, as a

consultant, advisor, agent or representative.  

Notwithstanding anything to the contrary herein, Ernest Carabillo may

serve as a director of companies to which he is permitted to consult under this

Agreement, including without limitation, Boston Medical Technologies, Inc., and

the successors to their businesses.




 




(b)           Newco agrees that for a period of

three years from the Effective Time, it shall not, and shall cause its

Affiliates not to, in any manner, directly or indirectly, (i) induce any person

that has been an employee of any of the Sunrise Companies at any time  between January 1, 2001 and the Effective

Time, to leave the employ of any Sunrise Company, (ii) except in response

to a good faith request by a person that is not an Affiliate of Newco for a

recommendation regarding the employment qualifications of such employee, recommend

to any other person that they




 




 




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employ any

such employee, or (iii) hire any such employee, except as set forth on

Schedule 3.04.




 




(c)           Newco agrees that for a period of

five years from the Effective Time, it shall not, and shall cause its

Affiliates not to, in any manner, directly or indirectly, (i) solicit by mail,

by telephone, by personal meeting or by any other means, either directly or

indirectly, any customer or supplier of Parent, the Company or any of their

respective Affiliates to transact business in the Diabetes Field with a

business or enterprise that competes with Parent, the Company or any of their

respective Affiliates in the Diabetes Field or reduce or refrain from doing any

business with Parent, the Company or any of their respective Affiliates in the

Diabetes Field except PPM Activities, or (ii) disparage (including by relative

comparison) Parent or the Company or any of their products or activities in the

Diabetes Field except good faith comparative assessment with respect to PPM

Activities.




 




(d)           Notwithstanding the termination of

this Agreement for any reason, and irrespective of the time, manner or cause of

termination, Newco’s obligations under this Section 3.04 run with the business of

Newco and shall survive and remain in full force and effect for the periods

therein provided, and the provisions for equitable relief against Newco shall

continue in full force and effect. 

Notwithstanding the foregoing, the provisions of Section 3.04(a) and (c)

shall not be applicable to an acquirer (including any of its Affiliates other

than Newco and its subsidiaries) of all or any part of the Newco Business if

(x) such acquiror acquired Newco in a bona fide, arms-length transaction

and (y) none of Ron Zwanziger, David Scott or Jerry McAleer are actively

involved, whether directly or indirectly, in the management of such acquirer’s

business in the Diabetes Field during the period of the applicable

non-competition covenants set forth in those certain Consulting and

Noncompetition Agreements each dated the same date as the Merger Agreement

among Parent, the Company and such individual.




 




(e)           The foregoing notwithstanding,

nothing in Section 3.04(a) - (d) shall prevent Newco, or Affiliates of Newco,

from participating, directly or indirectly, in any manner whatsoever in PPM

Activities in the Diabetes Field, including, without limitation, competing,

engaging, controlling, managing, owning, investing, consulting, soliciting

customers.  For purposes of this Agreement,

“PPM Activities” shall mean and be limited to the following:




 




1.                                       Owning physician practices;




 




 




14





























 




2.                                       Providing “back office” management services to physicians and

practitioners (both physicians and practitioners are collectively referred to

as “members”) (such as billing, collections, scheduling, reimbursement etc.);




 




3.                                       Compiling data from its members for the purposes of establishing

disease management best practices; and




 




4.                                       Providing group-buying services for its members, excluding any

and all products and services in the Diabetes Field and excluding Multi-Analyte

Systems which include Diabetes Tests as defined in the License Agreement;




 




it being

agreed and acknowledged that Newco shall not in any way direct or influence the

purchasing decisions of members with respect to products and services in the

Diabetes Field or with respect to Multi-Analyte Systems which include Diabetes

Tests as defined in the License Agreement.




 




SECTION

3.05.      Net Cash Adjustment.  (a)  Not

less than four business days prior to the Closing Date and in accordance with

the Restructuring Agreement, Newco shall prepare and deliver to Parent the

Initial Statement setting forth the Estimated Net Cash.  Within 10 days after the Closing Date,

Newco shall prepare and deliver to Parent a statement (the “Closing Statement”

and, together with the Initial Statement, the “Statements”) setting forth Net

Cash  (which amount shall not include

the Net Cash Adjustment Amount) (“Closing Net Cash”).




 




During the 10 day period following Parent’s

receipt of the Closing Statement, Parent and its independent auditors will be

permitted to review Newco’s working papers relating to the Statements.  The Statements shall become final and

binding upon the parties on the tenth day following receipt of the Closing

Statement, unless Parent gives written notice of its disagreement with either

Statement (“Notice of Disagreement”) to Newco prior to such date.  Any Notice of Disagreement shall (i) specify

in reasonable detail the nature of any disagreement so asserted and (ii) only

include disagreements based on Estimated Net Cash or Closing Net Cash, as the

case may be, not being calculated in accordance with this Section 3.05.  If a Notice of Disagreement is received by

Newco in a timely manner, then the Statements (as revised in accordance with

clauses (A) or (B) below) shall become final on the earlier of (A) the date

Parent and Newco resolve in writing any differences they have with respect to

the matters specified in the Notice of Disagreement or (B) the date any

disputed




 




 




15





























 




matters are finally resolved in writing by

the Accounting Firm (as defined below).




 




During

the 20 day period following delivery of a Notice of Disagreement, Parent and

Newco shall seek in good faith to resolve in writing any differences that they

may have with respect to the matters specified in the Notice of

Disagreement.  During such period Newco

and its independent auditors shall have access to the working papers relating

to the Notice of Disagreement.  At the

end of such 20 day period, Parent and Newco shall submit to an independent

accounting firm (the “Accounting Firm”) for review and resolution any and all

matters that remain in dispute and which were properly included in the Notice

of Disagreement.  The Accounting Firm

shall be a nationally recognized independent public accounting firm agreed upon

by Parent and Newco in writing, other than Arthur Andersen LLP or

PricewaterhouseCoopers LLP.  Parent and

Newco shall jointly use all reasonable efforts to cause the Accounting Firm to

render a decision within 20 days following submission.  Parent and Newco agree that judgment may be

entered upon the determination of the Accounting Firm in any court having

jurisdiction over the party against which such determination is to be

enforced.  The cost of any dispute

resolution (including the fees and expenses of the Accounting Firm and

reasonable attorney fees and expenses of the parties) pursuant to this Section

3.05 shall be borne by Parent and Newco in inverse proportion as they may

prevail on matters resolved by the Accounting Firm, which proportionate

allocations shall also be determined by the Accounting Firm at the time the

determination of the Accounting Firm is rendered on the merits of the matters

submitted.  The fees and disbursements

of Newco’s independent auditors in connection with their review of any Notice

of Disagreement shall be borne by Newco and the fees and disbursements of

Parent’s independent auditors incurred in connection with their review of the

Statements shall be borne by Parent.




 




(b)           If the sum of (x) Closing Net

Cash and (y) the Net Cash Adjustment Amount exceeds $40,000,000, Newco

shall, within 10 days after the Statements become final and binding on the

parties, make payment to the Company by wire transfer of immediately available

funds of such excess, together with interest thereon at a rate equal to the

rate of interest from time to time announced publicly by Citibank, N.A. as its

prime rate, calculated on the basis of the actual number of days elapsed

divided by 365, from the Closing Date to the date of payment.




 




(c)           The scope of the disputes to be

resolved by the Accounting Firm is limited to whether the Statements




 




 




16





























 




were

prepared in compliance with the requirements of this Section 3.05, and the

Accounting Firm is not to make any other determination.




 




(d)           During the period of time from and

after the delivery of the Closing Statement to Parent through the date the

Statements becomes final and binding on the parties, Newco shall cause the

Newco Companies to afford to Parent and any accountants, counsel or financial

advisors retained by Parent in connection with the adjustment contemplated by

this Section 3.05 reasonable access during normal business hours to the Newco

Companies’ books and records to the extent relevant to the adjustment

contemplated by this Section 3.05.




 




SECTION

3.06.      Successors.  None of Newco or any of the Newco Subsidiary

Indemnitors shall consolidate with or merge with or into, or sell, convey,

transfer or lease, in one transaction or a series of transactions, all or

substantially all of its assets to, any person, unless the resulting, surviving

or transferee person (the “Successor Company”) shall expressly assume, by an

instrument in form and substance reasonably satisfactory to Parent, all the

obligations of such Newco Indemnitor under this Agreement.  The Successor Company shall be the successor

to Newco or such Newco Indemnitor, as applicable, and shall succeed to, and be

substituted for, such Newco or Newco Indemnitor, as applicable, under this

Agreement, but, in the case of a sale, conveyance, transfer or lease, Newco or

such Newco Indemnitor, as applicable, shall not be released from its

obligations hereunder.




 




SECTION

3.07.      Third Party Rights.  (a)        In the event that after the Effective

Time any of the Newco Companies holds any right to indemnification other than a

right to indemnification under this Agreement or any other contractual or other

right (collectively, a “Newco Recourse Right”) with respect to any Sunrise

Liability or any Assumed Liability for which any of the Sunrise Companies are

held responsible, then (i) to the extent possible such Newco Recourse

Right shall be deemed to be held as a shared right of the applicable Newco

Companies and the applicable Sunrise Companies to the extent necessary to

protect the Sunrise Companies against such Sunrise Liability or such Assumed

Liability, and (ii) to the extent not so possible, Newco shall, or shall

cause a Newco Company to, assert or otherwise make available to the Sunrise

Companies the full benefit of such Newco Recourse Right by making a claim on

behalf of the Sunrise Companies or taking other steps reasonably requested by

the Sunrise Companies.




 




 




17





























 




(b)           In the event that after the Effective

Time any of the Sunrise Companies holds any right to indemnification or any

other contractual or other right (collectively, a “Sunrise Recourse Right”)

with respect to any Assumed Liability or any Sunrise Liability for which any of

the Newco Companies are held responsible, then (i) to the extent possible

such Sunrise Recourse Right shall be deemed to be held as a shared right of the

applicable Sunrise Companies and the applicable Newco Companies to the extent

necessary to protect the Newco Companies against such Assumed Liability or such

Sunrise Liability, and (ii) to the extent not so possible, the Company

shall, or shall cause a Sunrise Company to, assert or otherwise make available

to the Newco Companies the full benefit of such Sunrise Recourse Right by

making a claim on behalf of the Newco Companies or taking other steps

reasonably requested by the Newco Companies.




 




ARTICLE

IV




 




MISCELLANEOUS

AND GENERAL




 




SECTION 4.01.      Effectiveness; Modification or Amendment.  The parties hereto agree that this Agreement




will become effective at the Effective

Time.  The parties hereto may modify or

amend this Agreement only by written agreement executed and delivered by duly

authorized officers of the respective parties.




 




SECTION 4.02.      Extension; Waiver. 

At any time the parties may (a) extend the time for the performance

of any of the obligations or other acts of the other parties or (b) waive

compliance with any of the agreements or conditions contained herein.  Any agreement on the part of a party to any

such extension or waiver shall be valid only if set forth in an instrument in

writing signed on behalf of such party. 

The failure of any party to this Agreement to assert any of its rights

under this Agreement or otherwise shall not constitute a waiver of such rights.




 




SECTION 4.03.      Counterparts. 

This Agreement may be executed in one or more counterparts, all of which

shall be considered one and the same agreement and shall become effective when

one or more counterparts have been signed by each of the parties and delivered

to the other parties.




 




SECTION 4.04.      Governing Law. 

This Agreement shall be governed by, and construed in accordance with,

the laws of the State of Delaware, regardless of the laws that might otherwise

govern under applicable principles of




 




 




18





























 




conflicts of laws thereof.




 




SECTION 4.05.      Notices.  All

notices, requests, claims, demands and other communications under this

Agreement shall be in writing and shall be deemed given if delivered

personally, telecopied (which is confirmed) or sent by overnight courier

(providing proof of delivery) to the parties at the following addresses (or at

such other address for a party as shall be specified by like notice):




 




(a)           if to Parent or the Sunrise Companies

(including, after the Effective Time, the Company), to




 




Johnson & Johnson




One Johnson & Johnson Plaza




New Brunswick, NJ 08933




 




Telecopy No.:  (732) 524-2788




 




Attention: 

Office of General Counsel




 




with a copy to:




 




Cravath, Swaine & Moore




825 Eighth Avenue




New York, NY 10019




 




Telecopy No.:  (212) 474–3700




 




Attention: 

Robert I. Townsend, III




 




(b)           if to the Company (prior to the

Effective Time), to




 




Inverness Medical

Technology, Inc.




51 Sawyer Road,

Suite 200




Waltham, MA 02453




 




Telecopy No.:  (781) 647–3939




 




Attention: 

Chief Executive Officer




 




with a copy to:




 




Goodwin Procter LLP




53 State Street




Boston, MA 02109




 




Telecopy No.:  (617) 523–1231




 




Attention:   Paul D. Schwartz, P.C.




 




 




19





























 




Stephen W. Carr,  P.C.




 




(c)           if to Newco or the Newco Companies,

to




 




Inverness Medical

Innovations, Inc.




51 Sawyer Road, Suite 200




Waltham, MA 02453




 




Telecopy No.:  (781) 647–3939




 




Attention: 

Chief Executive Officer




 




with a copy to:




 




Goodwin Procter LLP




53 State Street




Boston, MA 02109




 




Telecopy No.:  (617) 523–1231




 




Attention:   Paul D. Schwartz, P.C.




Stephen W.

Carr,  P.C.




 




SECTION 4.06.      Captions.  All

the Article, Section and paragraph captions herein are for convenience of

reference only, do not constitute part of this Agreement and shall not be

deemed to limit or otherwise affect any of the provisions hereof.




 




SECTION 4.07.      Assignment. 

Except as provided in Section 3.06, neither this Agreement nor any

of the rights, interests or obligations under this Agreement shall be assigned,

in whole or in part, by operation of law or otherwise by any of the parties

without the prior written consent of the other parties.  Subject to the preceding sentence, this

Agreement will be binding upon, inure to the benefit of, and be enforceable by,

the parties and their respective successors and assigns.




 




SECTION

4.08.      Entire Agreement.  The Transaction Agreements (including the

documents and instruments referred to therein, the Annexes thereto, the Parent

Disclosure Schedule and the Company Disclosure Schedule) and the

Confidentiality Agreement constitute the entire agreement, and supersede all

prior agreements and understandings, both written and oral, among the parties

with respect to the subject matter hereof and thereof.




 




SECTION

4.09.      Certain Obligations.  Whenever this Agreement requires any of the

subsidiaries of any party to take any action, this Agreement will be deemed to

include an




 




 




20





























 




undertaking

on the part of such party to cause such subsidiary to take such action; provided,

however, that for this purpose, after the Effective Time, the Newco

Companies shall not be considered to be subsidiaries of the Company unless

specifically included.




 




SECTION

4.10.      Severability.  If any provision of this Agreement is

invalid, illegal or incapable of being enforced by any rule of law or public

policy, all other conditions and provisions of this Agreement shall

nevertheless remain in full force and effect. 

Upon such determination that any term or other provision is invalid,

illegal or incapable of being enforced, the parties hereto shall negotiate in

good faith to modify this Agreement so as to effect the original intent of the

parties as closely as possible to the fullest extent permitted by applicable

law in an acceptable manner to the end that the transactions contemplated

hereby are fulfilled to the extent possible.




 




SECTION 4.11.      No Third Party Beneficiaries.  Nothing contained in this Agreement is intended to confer upon

any person or entity other than the parties hereto and their respective

successors and permitted assigns, any benefit, right or remedies under or by

reason of this Agreement, except that the provisions of Article II hereof

shall inure to the benefit of Indemnitees.




 




SECTION 4.12       Specific Enforcement; Jurisdiction.  The parties agree that irreparable damage

would occur and that the parties would not have any adequate remedy either

pursuant to the indemnification provisions of Section 2.01, 2.02 or 2.03, as

the case may be, or at law in the event that any of the provisions of this

Agreement, including, but not limited to Section 3.04, were not performed in

accordance with their specific terms or were otherwise breached.  It is accordingly agreed that the parties

shall be entitled to an injunction or injunctions to prevent breaches of this

Agreement and to enforce specifically the terms and provisions of this

Agreement in any Federal court located in the State of Delaware in any state

court in the State of Delaware, this being in addition to any other remedy to

which they are entitled at law or in equity. 

In addition, each of the parties hereto (a) consents to submit

itself to the personal jurisdiction of any Federal court located in the State

of Delaware or of any state court located in the State of Delaware in the event

any dispute arises out of this Agreement or the transactions contemplated by

this Agreement, (b) agrees that it will not attempt to deny or defeat such

personal jurisdiction by motion or other request for leave from any such court

and




 




 




21





























 




(c)  

agrees that it will not bring any action relating to this Agreement or

the transactions contemplated by this Agreement in any court other than a

Federal court located in the State of Delaware or a state court located in the

State of Delaware.




 




 




22





























 




IN

WITNESS WHEREOF, this Agreement has been duly executed and delivered by the

duly authorized officers of the parties hereto on the date first hereinabove

written.




 




	

   


  	

  JOHNSON & JOHNSON,


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    /s/ 

  ERIC MILLEDGE


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Eric Milledge


  
	

   


  	

   


  	

  Title:


  	

  Company Group Chairman


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  INVERNESS MEDICAL TECHNOLOGY, INC.,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    /s/ 

  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President and Chief


  
	

   


  	

   


  	

   


  	

  Executive Officer


  
						





 




 




 




 




[Post-Closing

Covenants Agreement]





























 




	

   


  	

  INVERNESS MEDICAL LIMITED,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  Director


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  INTEG INCORPORATED,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  CAN-AM CARE CORPORATION,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  INVERNESS MEDICAL EUROPE GmbH,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  OTTO WAHL


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Otto Wahl


  
	

   


  	

   


  	

  Title:


  	

  Managing Director


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  LXN CORPORATION,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  INVERNESS MEDICAL ASIA-PACIFIC PTY LTD.,  


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  ROBERT M. DELBRIDGE


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Robert M. Delbridge


  
	

   


  	

   


  	

  Title:


  	

  Director


  
						





 




[Post-Closing

Covenants Agreement]





























 




	

   


  	

  INVERNESS MEDICAL INNOVATIONS, INC


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President and Chief


  
	

   


  	

   


  	

   


  	

  Executive Officer


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  
	

   


  	

  INVERNESS MEDICAL, INC.,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President and Chief


  
	

   


  	

   


  	

   


  	

  Executive Officer


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  
	

   


  	

  INVERNESS MEDICAL CANADA INC.,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President 


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  CAMBRIDGE DIAGNOSTICS IRELAND LTD.,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  Director


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  INVERNESS MEDICAL BENELUX Bvba,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  TINE CATTEEUW


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Tine Catteeuw


  
	

   


  	

   


  	

  Title:


  	

  Managing Director


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  ORGENICS, LTD.,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  EMANUEL HART


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Emanuel Hart


  
	

   


  	

   


  	

  Title:


  	

  President


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  F. FISH


  	

   


  
	

   


  	

   


  	

  Name:


  	

  F. Fish


  
	

   


  	

   


  	

  Title:


  	

  Vice President


  
						





 




[Post-Closing

Covenants Agreement]





























 




	

   


  	

  ORGENICS INTERNATIONAL HOLDINGS B.V.,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  Managing Director


  
	

   


  	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  KENNETH D. LEGG


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Kenneth D. Legg


  
	

   


  	

   


  	

  Title:


  	

  Managing Director


  
	

   


  	

   


  
	

   


  	

  SELFCARE TECHNOLOGY, INC.,


  
	

   


  	

   


  	

   


  
	

   


  	

  By:

  


  	

    

  /s/  RON ZWANZIGER


  	

   


  
	

   


  	

   


  	

  Name:


  	

  Ron Zwanziger


  
	

   


  	

   


  	

  Title:


  	

  President


  
					





 




[Post-Closing

Covenants Agreement]




 




 





























 




 




 




INVERNESS MEDICAL TECHNOLOGY, INC.




Schedules to Post-Closing Covenants Agreement




 




 




 





























INVERNESS MEDICAL TECHNOLOGY, INC.




Schedules to Post-Closing Covenants Agreement




 




 




Schedule 2.01(iv)




 




Certain

Warrant Matters




 




 




                It

is contemplated, pursuant to Section 7.1 of the Restructuring Agreement and

Section 6.04(g) of the Merger Agreement, that outstanding warrants to purchase

Company Common Stock will be converted into warrants to purchase Newco Common

Stock and Parent Common Stock as and to the extent set forth in such sections

(the “Conversions”).  The Company has

agreed to use commercially reasonable efforts to take all action as is

necessary to effect such Conversions, including to obtain the Amendments (as

defined below).  The Company may need to

obtain the consent of the holders of USBIII Warrants and USBIV Warrants (as

defined in Section 4.01(c) of the Company Disclosure Schedule) (collectively,

the “USB Warrants”) representing the right to purchase an aggregate of 270,680

shares of Company Common Stock to amend the terms of such USB Warrants to

facilitate such Conversions (the “Amendments”).  Section 7.02(e) of the Merger Agreement contemplates that Parent

is not obligated to consummate the transactions contemplated by the Merger

Agreement in the event holders of USB Warrants representing the right to

purchase in the aggregate more than 10,000 shares of Company Common Stock do

not consent to the Amendments.




 




                In

the event that the holders of USB Warrants fail to consent to the Amendments in

respect of any USB Warrants, Newco agrees to indemnify (subject to the proviso

at the end of this sentence) Parent and the Company for all Indemnifiable

Losses arising from the failure to obtain the consent of holders of USB

Warrants to the Amendments to such USB Warrants prior to the Effective Time,

including for any consideration issued in excess of what would have been issued

had such consents been obtained prior to the Effective Time; provided, however,

that such indemnification obligations shall apply only with respect to

USB Warrants representing the right to purchase up to 50,000 shares of Company

Common Stock in the aggregate.  As a

condition to Newco’s willingness to so indemnify Parent and the Company, Parent

and the Company covenant and agree that, with respect to the USB Warrants, (i)

neither Parent nor the Company shall settle any claims made by the holders of

such USB Warrants with cash or any other property (other than solely the shares

of Parent Common Stock that would have been issued if such USB Warrants had

been exercised immediately prior to the Effective Time), and (ii) upon

Newco’s settlement of any such claim or satisfaction of Indemnifiable Losses

with respect to any such claim, Parent and the Company shall deliver, at the

written request of Newco, to Newco or its designees, the shares of Parent

Common Stock that would have been issued if the USB Warrants for which Newco

settles such claim or provides indemnification to the Parent or the Company

under this Schedule 2.01(iv) had been exercised immediately prior to the

Effective Time.




 




                For

the avoidance of doubt, the matters set forth in this Schedule 2.01(iv)

shall be subject to Article II of the Post-Closing Covenants Agreement,

including Section 2.04 thereof.




 





























INVERNESS MEDICAL TECHNOLOGY, INC.




Schedules to Post-Closing Covenants Agreement




 




 




Schedule 3.02




 




Maximum

Amount of Expenses




 




The maximum amount of expenses under Section

3.02 of the Post-Closing Covenants agreement for which the Company shall be

responsible shall be Twelve Million Dollars plus all: (i) fees and expenses

incurred by the parties hereto in connection with any litigation to the extent

arising out of or related in any way to the transactions contemplated by the

Transaction Agreements (the “Transactions”), 

including without limitation litigation based upon any registration

statement or proxy statement filed or used in connection with the Transactions

or proceedings based upon state law fiduciary duty claims related to the

Transactions; and (ii) fees and expenses (not to exceed Two Million Dollars)

incurred by the parties hereto in connection with the financing contemplated by

Section 7.02(g) of the Merger Agreement.




 





























INVERNESS MEDICAL TECHNOLOGY, INC.




Schedules to Post-Closing Covenants Agreement




 




 




Schedule 3.04




 




 




Employees

Exempt from Agreement Not to Solicit or Hire




 




 




Lesley Scott




 




Jack Wilkens — The provisions of Section 3.04(b) will

continue to apply with respect to Jack Wilkins until the six month anniversary

of the Effective Time.




John Alberico — The provisions of Section 3.04(b) will

continue to apply with respect to John Alberico until the six month anniversary

of the Effective Time.




Amy Coletti — The provisions of Section 3.04(b) will

continue to apply with respect to Amy Coletti until the termination of her

employment by a Sunrise Company or an Affiliate thereof.




Ryan Daly — The provisions of Section 3.04(b) will

continue to apply with respect to Ryan Daly until the termination of his

employment by a Sunrise Company or an Affiliate thereof.




David Stepper — The provisions of Section 3.04(b) will

continue to apply with respect to David Stepper until the termination of his

employment by a Sunrise Company or an Affiliate thereof.