**Exhibit 2.2**

 

 

 

STOCK PURCHASE AGREEMENT

 

TACONIC FARMS, INC.,

 

XENOGEN CORPORATION

 

and

 

CALIPER LIFE SCIENCES, INC.

 

 

 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’s applicationrequesting confidential treatment under Rule 24b-2 of the SecuritiesExchange Act of 1934, as amended.

 

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**TABLE OF CONTENTS**

 
| Article 1                                            |                                                                            | 1      |
|-----------------------------------------------------------|---------------------------------------------------------------------------------|--------|
|                                                      |                                                                            |   |
| PURCHASE AND SALE                                         | 1                                                                               |
|                                                      |                                                                            |   |
| 1.1                                                       | Purchase and Sale                                                               | 1      |
| 1.2                                                       | Closing                                                                         | 1      |
| 1.3                                                       | Purchase Price                                                                  | 2      |
| 1.4                                                       | Closing Calculations                                                            | 2      |
| 1.5                                                       | Closing Balance Sheet Calculations                                              | 2      |
| 1.6                                                       | Post-Closing Adjustment Payment                                                 | 3      |
| 1.7                                                       | Tax Withholding                                                                 | 4      |
|                                                      |                                                                            |   |
| Article 2 REPRESENTATIONS  AND WARRANTIES OF CALIPER | 4                                                                               |
|                                                      |                                                                            |
| 2.1                                                       | Organization of the Company                                                     | 4      |
| 2.2                                                       | Company Capital Structure                                                       | 5      |
| 2.3                                                       | Subsidiaries                                                                    | 5      |
| 2.4                                                       | Authority                                                                       | 5      |
| 2.5                                                       | No Conflict                                                                     | 6      |
| 2.6                                                       | Governmental Consents                                                           | 6      |
| 2.7                                                       | Company Financial Statements                                                    | 6      |
| 2.8                                                       | No Undisclosed Liabilities                                                      | 7      |
| 2.9                                                       | No Changes                                                                      | 7      |
| 2.10                                                      | Tax Matters,                                                                    | 9      |
| 2.11                                                      | Restrictions on Business Activities                                             | 12     |
| 2.12                                                      | Title to Properties; Absence of Liens and Encumbrances;  Condition of Equipment | 13     |
| 2.13                                                      | Intellectual Property                                                           | 14     |
| 2.14                                                      | Sufficiency of Assets                                                           | 17     |
| 2.15                                                      | Contracts                                                                       | 17     |
| 2.16                                                      | No Defaults                                                                     | 18     |
| 2.17                                                      | Interested Person Transactions                                                  | 19     |
| 2.18                                                      | Governmental Authorization                                                      | 19     |
| 2.19                                                      | Litigation                                                                      | 19     |
| 2.20                                                      | Accounts Receivable                                                             | 19     |
| 2.21                                                      | Minute Books                                                                    | 20     |
| 2.22                                                      | Environmental Matters                                                           | 20     |
| 2.23                                                      | Fees and Expenses                                                               | 23     |
| 2.24                                                      | Employee Benefit Plans and Compensation                                         | 23     |
| 2.25                                                      | Insurance and Bonds                                                             | 27     |
| 2.26                                                      | Compliance with Laws                                                            | 27     |

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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| 2.27                                                      | Animal Welfare                                                                                                        | 27     |
|-----------------------------------------------------------|-----------------------------------------------------------------------------------------------------------------------|--------|
| 2.28                                                      | Council on Accreditation of the Association for Assessment  and Accreditation of Laboratory Animal Care Certification | 27     |
| 2.29                                                      | Foreign Corrupt Practices Act                                                                                         | 28     |
| 2.30                                                      | Health Profiles                                                                                                       | 28     |
| 2.31                                                      | Warranties                                                                                                            | 28     |
| 2.32                                                      | Complete Copies of Materials                                                                                          | 28     |
| 2.33                                                      | Insider Loans                                                                                                         | 28     |
| 2.34                                                      | Suppliers and Customers                                                                                               | 28     |
| 2.35                                                      | Privacy                                                                                                               | 29     |
| 2.36                                                      | Compliance with the Immigration Reform and Control Act                                                                | 29     |
| 2.37                                                      | Data Room                                                                                                             | 29     |
| 2.38                                                      | Representations Complete                                                                                              | 30     |
|                                                      |                                                                                                                  |   |
| Article 3 REPRESENTATIONS  AND WARRANTIES OF TACONIC | 30                                                                                                                    |
|                                                      |                                                                                                                  |   |
| 3.1                                                       | Organization and Standing                                                                                             | 30     |
| 3.2                                                       | No Conflict                                                                                                           | 30     |
| 3.3                                                       | Consents                                                                                                              | 30     |
|                                                      |                                                                                                                  |   |
| Article 4 AGREEMENTS                                 | 31                                                                                                                    |
|                                                      |                                                                                                                  |   |
| 4.1                                                       | Confidentiality                                                                                                       | 31     |
| 4.2                                                       | Expenses                                                                                                              | 31     |
| 4.3                                                       | Public Disclosure                                                                                                     | 31     |
| 4.4                                                       | Reasonable Best Efforts                                                                                               | 31     |
| 4.5                                                       | Additional Documents and Further Assurances                                                                           | 32     |
| 4.6                                                       | Employment Arrangements                                                                                               | 32     |
| 4.7                                                       | Non-Continuing Employees                                                                                              | 32     |
| 4.8                                                       | Employment of Continuing Employees                                                                                    | 32     |
| 4.9                                                       | Internet Inquiries                                                                                                    | 33     |
| 4.10                                                      | Xenogen Trademark                                                                                                     | 33     |
| 4.11                                                      | Destruction of Confidential Information                                                                               | 33     |
| 4.12                                                      | Tax Matters                                                                                                           | 33     |
| 4.13                                                      | Tax Sharing Agreements                                                                                                | 35     |
| 4.14                                                      | Non-Solicitation                                                                                                      | 35     |
| 4.15                                                      | Caliper Confidential Information Remaining with the Company                                                           | 35     |
| 4.16                                                      | Promega Corporation (PGL3) Sublicense                                                                                 | 35     |
|                                                      |                                                                                                                  |   |
| Article 5 CONDITIONS TO THE  CLOSING                 | 35                                                                                                                    |
|                                                      |                                                                                                                  |   |
| 5.1                                                       | Conditions to the Obligations of Each Party to Effect the  Transaction                                                | 35     |
| 5.2                                                       | Additional Conditions to the Obligations of Taconic                                                                   | 36     |
| 5.3                                                       | Additional Conditions to the Obligations of Caliper                                                                   | 37     |

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’s applicationrequesting confidential treatment under Rule 24b-2 of the SecuritiesExchange Act of 1934, as amended.

 

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| Article 6 INDEMNIFICATION  AND ESCROW | 38                           |
|--------------------------------------------|------------------------------|
|                                       |                         |
| 6.1                                        | Survival                     | 38 |
| 6.2                                        | Indemnification by Caliper   | 38 |
| 6.3                                        | Claims for Indemnification   | 40 |
| 6.4                                        | Escrow Fund                  | 41 |
|                                       |                         |   |
| Article 7 GENERAL PROVISIONS          | 42                           |
|                                       |                         |   |
| 7.1                                        | Notices                      | 42 |
| 7.2                                        | Interpretation               | 43 |
| 7.3                                        | Counterparts                 | 43 |
| 7.4                                        | Entire Agreement; Assignment | 43 |
| 7.5                                        | Severability                 | 43 |
| 7.6                                        | Other Remedies               | 44 |
| 7.7                                        | Governing Law                | 44 |
| 7.8                                        | Rules of Construction   | 44 |
| 7.9                                        | Specific Performance         | 44 |
| 7.10                                       | Attorneys’ Fees         | 44 |
| 7.11                                       | WAIVER OF JURY TRIAL         | 44 |
|                                       |                         |   |
| Article 8 DEFINITIONS                 | 44                           |

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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INDEX OF EXHIBITS

 
| **Exhibit**    | ** ** | **Description**                                     |
|----------------|------------|-----------------------------------------------------|
|           |       |                                                |
| Exhibit A |       | Closing  Agenda                                     |
|           |       |                                                |
| Exhibit B |       | Form of  Section 382 Allocation Agreement |
|           |       |                                                |
| Exhibit C |       | Distribution  and Supply Agreement                  |
|           |       |                                                |
| Exhibit D |       | Form of  Escrow Agreement                      |
|           |       |                                                |
| Exhibit E |       | License  Agreement (for Imaging Services)           |

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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STOCKPURCHASE AGREEMENT (this “Agreement”) is made and entered into as of December 11,2009 by and among Taconic Farms, Inc., a New York corporation (“Taconic”), Caliper Life Sciences, Inc., aDelaware corporation (“CLS”), and Xenogen Corporation, a Delaware corporationand a wholly owned subsidiary of CLS (“Xenogen” and collectively with CLS, “Caliper”).Certain capitalized terms used but not otherwise defined herein are defined in Article 8hereof.  All representations, covenantsand agreements of CLS and Xenogen herein shall be deemed to be joint andseveral, whether so expressed or not, unless otherwise not permitted by thecontext.

 

RECITALS

 

A.            Taconic wishes to purchasefrom Caliper, and Caliper wishes to sell to Taconic, all of the issued andoutstanding capital stock and other equity interests in Xenogen BiosciencesCorporation, an Ohio corporation (the “Company”) and wholly ownedsubsidiary of Caliper.

 

B.            A portion of theconsideration payable by Taconic in connection with this Agreement and the transactionscontemplated hereby (the “Transaction”) shall be placed in escrow byTaconic as security for the indemnification obligations set forth in thisAgreement.

 

C.            Caliper is making certainrepresentations warranties regarding the Company and is also making certaincovenants and other agreements in connection with the Transaction.

 

NOW,THEREFORE, in consideration of the mutual agreements, covenants and otherpromises set forth herein, the mutual benefits to be gained by the performancethereof, and for other good and valuable consideration, the receipt andsufficiency of which are hereby acknowledged and accepted, the parties herebyagree as follows:

 

ARTICLE 1

 

PURCHASE AND SALE

 

1.1           Purchase and Sale.  Upon the terms and subject to the conditionsof this Agreement, Caliper will sell to Taconic, and Taconic will purchase fromCaliper, at the Closing (as defined below), all of the issued and outstandingcapital stock (the “Shares”) in the Company.

 

1.2           Closing.

 

(a)      The closing of theTransaction (the “Closing”) is effective as of 9a.m. on the day thisAgreement and the Ancillary Agreements, in addition to other closing documents,are executed and delivered.  For thispurpose, such date is called the “Closing Date.”  All documents and signatures are beingexchanged by electronic delivery.

 

(b)      At the Closing:

 

(i)            Taconic is delivering (A) theEstimated Purchase Price to Caliper, *less* anamount equal to the Escrow Amount, by wire transfer of immediately availablefunds, and (B) the Escrow Amount to the Escrow Agent by wire transfer ofimmediately available funds.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(ii)           Caliper is delivering toTaconic certificates for the Shares duly endorsed or accompanied by stockpowers duly endorsed in blank, with any required transfer stamps affixedthereto.

 

(iii)          The appropriate persons areexecuting and delivering the license, distribution, escrow, transition servicesand other ancillary agreements and documents (the “Ancillary Agreements”).

 

(iv)          The appropriate persons areexecuting and delivering, or delivering, the other items set forth on theClosing Agenda attached hereto as Exhibit A.

 

1.3           Purchase Price.

 

(a)      The “Final Purchase Price”shall be an amount equal to:

 

(i)            Eleven Million Dollars($11,000,000),

 

(ii)           *plus* Company Cash,

 

(iii)          *minus* anyIndebtedness that has not been discharged pursuant to Section 5.2(f),

 

(iv)          *minus* the DeferredRevenue Amount, and

 

(v)           *plus* (or *minus*) the Net Working CapitalAdjustment.

 

1.4           Closing Calculations.

 

(a)      Caliper has caused theCompany to deliver to Taconic its good faith calculation, in reasonable detail,of its estimate of the following amounts as of the close of business on theClosing Date:

 

(i)            the amount of Company Cash(the “Estimated Company Cash”),

 

(ii)           the amount of Indebtedness(the “Estimated Indebtedness”),

 

(iii)          the Deferred Revenue Amount(the “Estimated Deferred Revenue Amount”) and

 

(iv)          Net Working Capital (the “EstimatedNet Working Capital”).

 

(b)      Using these estimates, theparties have agreed that, for purposes of the Closing, the Final Purchase Priceis estimated at Ten Million Seven Hundred Seventy One Thousand Nine HundredSixty Five Dollars ($10,771,965) (the “Estimated Purchase Price”).

 

1.5           Closing Balance Sheet Calculations.  As promptly as practicable, but in any eventwithin 60 days after the Closing Date, Taconic will deliver to Caliper aconsolidated balance sheet of the Company dated as of the close of business onthe Closing Date (the “Closing Balance Sheet”) and a statement showingthe calculation, as of such date and time, of Company Cash, Indebtedness,the Deferred Revenue Amount, Net Working Capital and the Net Working 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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CapitalAdjustment, all derived from the Closing Balance Sheet (together with theClosing Balance Sheet, the “Preliminary Statement”). The Closing BalanceSheet shall be prepared and Company Cash, Indebtedness, the DeferredRevenue Amount, Net Working Capital, and the Net Working Capital Adjustmentshall be determined in accordance with GAAP using the same accounting methods,policies, principles, practices and procedures, with consistentclassifications, judgments and estimation methodology, as were used inpreparation of the Financial Statements. After delivery of the Preliminary Statement, Caliper and its accountantsand other representatives shall be permitted reasonable access to review theCompany’s books and records and work papers related to the preparation of thePreliminary Statement. Caliper and its accountants and other representativesmay make inquires of Taconic and its accountants regarding questions concerningor disagreements with the Preliminary Statement arising in the course of theirreview thereof, and Taconic shall use its, and shall cause the Company to useits, commercially reasonable best efforts to cause any such accountants tocooperate with and respond to such inquiries. If Caliper has any objections tothe Preliminary Statement, Caliper shall deliver to Taconic a statement settingforth its objections thereto (an “Objections Statement”). If an ObjectionsStatement is not delivered to Taconic within 30 days after delivery of thePreliminary Statement, the Preliminary Statement shall be final, binding andnon-appealable by the parties hereto. Caliper and Taconic shall negotiate ingood faith to resolve any such objections, but if they do not reach a finalresolution within fifteen (15) days after the delivery of the ObjectionsStatement, Caliper and Taconic shall submit such dispute to BDO Seidman, LLP(the “Dispute Resolution Auditor”). Any further submissions to theDispute Resolution Auditor must be written and delivered to each party to thedispute. The Dispute Resolution Auditor shall consider only those items andamounts which are identified in the Objections Statement as being items which Caliperand Taconic are unable to resolve. The Dispute Resolution Auditor’sdetermination will be based solely on the definitions of Company Cash, Indebtedness,the Deferred Revenue Amount, Net Working Capital, and the Net Working CapitalAdjustment contained herein and the provisions of this Section 1.5.Caliper and Taconic shall use their commercially reasonable best efforts tocause the Dispute Resolution Auditor to resolve all such disagreements as soonas practicable. Further, the Dispute Resolution Auditor’s determination shallbe based solely on the presentations by Taconic and Caliper which are inaccordance with the terms and procedures set forth in this Agreement (i.e., noton the basis of an independent audit or review). The resolution of the disputeby the Dispute Resolution Auditor shall be final, binding and non-appealable onthe parties hereto. The costs and expenses of the Dispute Resolution Auditorshall be allocated between Taconic, on the one hand, and Caliper on the otherhand, based upon the percentage which the portion of the contested amount notawarded to each party bears to the amount actually contested by such party. Forexample, if Caliper claims the appropriate adjustments are $1,000 greater thanthe amount determined by Taconic’s accountants, and Taconic contests only $500of the amount claimed by Caliper, and if the Dispute Resolution Auditorultimately resolves the dispute by awarding to Caliper $300 of the $500contested, then the costs and expenses of arbitration will be allocated 60%(i.e., 300 ÷ 500) to Taconic and 40% (i.e., 200 ÷ 500) to Caliper.

 

1.6           Post-Closing Adjustment Payment.

 

(a)      If, after taking intoaccount any required adjustments, the Final Purchase Price is greater than theEstimated Purchase Price (the amount of such difference, a “Payment 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

3

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Shortfall”), then Taconic shall,within five (5) business days of the final determination of the FinalPurchase Price, pay the Payment Shortfall to Caliper.

 

(b)      If, after taking intoaccount any required adjustments, the Final Purchase Price is less than theEstimated Purchase Price (the amount of such difference, an “Excess Payment”),then Caliper shall, within five (5) business days of the finaldetermination of the Final Purchase Price, pay the Excess Payment to Taconic.

 

1.7           Tax Withholding.Taconic will be entitled to deduct and withhold from the considerationotherwise payable pursuant to this Agreement to any person or entity suchamounts as Taconic determines it is required to deduct and withhold withrespect to the making of such payment under the Code or any other provision ofstate, local or foreign Tax Law.  To theextent that amounts are so withheld, such withheld amounts will be treated forall purposes hereof as having been paid to such person or entity in respect ofwhich such deduction and withholding was made.

 

ARTICLE 2

 

REPRESENTATIONS ANDWARRANTIES OF CALIPER

 

Caliperrepresents and warrants to Taconic that, except as set forth in the DisclosureSchedule delivered by Caliper to Taconic (the “Disclosure Schedule”),the statements contained in this Article 2 are true and correct as of thedate of the Closing, except to the extent such representations and warrantiesare specifically made as of a particular date (in which case suchrepresentations and warranties will be true and correct as of such date).  Caliper further represents and warrants thatthe statements contained in the Disclosure Schedule are true and correct as ofthe date of the Closing.  The DisclosureSchedule shall be arranged in sections and subsections corresponding to thenumbered and lettered sections and subsections contained in this Article 2.The disclosures in any section orsubsection of the Disclosure Schedule will qualify other sections or subsectionsin this Article 2 only if it is reasonably clear from a reading of thedisclosure that such disclosure is applicable to such other sections andsubsections and the relationship between the disclosure and the related sectionand subsections is reasonably clear.

 

2.1           Organization of the Company.  The Company is a corporation duly organized,validly existing and in good standing under the Laws of Ohio. The Company hasthe corporate power to own its properties and to carry on its business ascurrently conducted. The Company is duly qualified or licensed to do businessand in good standing as a foreign corporation (if applicable) in eachjurisdiction in which it conducts business, except where the failure to be soqualified, licensed or in good standing, individually or in the aggregate, hasnot had and would not reasonably be expected to have a Company Material AdverseEffect. Caliper has delivered to Taconic (i) a true and correct copy ofthe Company’s certificate of incorporation and bylaws (collectively, the “CompanyCharter Documents”) and (ii) a true and correct copy of the minutes ofmeetings and other actions of the board of directors, including any committeesof the board of directors, and the stockholder of the Company (acting in itscapacity as such) since the Acquisition Date, which reflect all actions of suchstockholder (acting in its capacity as such), the board of directors and anycommittees of the board of directors of the Company up to the date hereof andare in full force and effect on the date hereof. Section 2.1 of theDisclosure 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of the SecuritiesExchange Act of 1934, as amended.

 

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Schedule lists the directors and officers ofthe Company. The operations now being conducted by the Company are not now and,since January 1, 2001, have not been conducted by the Company under anyother name. The Company is not in violation of any of the provisions of theCompany Charter Documents.

 

2.2           Company Capital Structure.

 

(a)      The authorized capital stockof the Company consists of 750,000 shares of common stock, no par value (“CommonStock”).  The Company has 1,000shares of Common Stock outstanding, and all outstanding shares of capital stockof the Company are owned, of record and beneficially, by Xenogen, which is adirect wholly owned subsidiary of CLS. The Shares are duly authorized, validlyissued, fully paid and non-assessable and not subject to preemptive rightscreated by statute, the Company Charter Documents, or any agreement to whichthe Company or Caliper is a party or by which either the Company or Caliper isbound. Since at least January 1, 2001, the Company has not repurchased anyshares of its capital stock. There are no declared or accrued but unpaiddividends with respect to any shares of Common Stock.

 

(b)      The Company has not, sincethe Acquisition Date, authorized or issued any Common Stock, and there are not,and have not been since the Acquisition Date, any options, warrants, calls,rights, commitments or agreements of any character, written or oral, to whichCaliper or any of its Subsidiaries, including the Company (each a “CaliperCompany”), is a party or by which it is bound, obligating any such entityto issue, deliver, sell, repurchase or redeem, or cause to be issued,delivered, sold, repurchased or redeemed, any shares of the capital stock ofthe Company or obligating the Company to grant any such option, warrant, call,right, commitment or agreement. There are not, and since the Acquisition Datehave not been, any outstanding or authorized stock appreciation, stock unit,phantom stock, profit participation or other similar rights with respect to theCompany. There are no voting trusts, proxies, or other agreements orunderstandings with respect to the voting stock of the Company. Upon theconsummation of the Closing, Taconic will be the sole record and beneficialholder of the Shares and all rights to acquire or receive any Shares.

 

2.3           Subsidiaries.  The Company does not have, and since theAcquisition Date never had, any Subsidiaries and does not otherwise own anyshares of capital stock or any interest in, or control, directly or indirectly,any other corporation, partnership, association, joint venture or otherbusiness entity or have any ongoing obligation to purchase any shares ofcapital stock with respect thereto. Any other documents required by applicableLaw to be filed with the competent commercial register or other comparableauthorities have been completed and duly and timely filed, except where thefailure to file any such documents, individually or in the aggregate, has nothad and would not reasonably be expected to have a Company Material AdverseEffect. The Company does not have any permanent establishments, branches,agencies or similar affiliates.

 

2.4           Authority.

 

(a)      Caliper has all requisitecorporate power and authority to enter into this Agreement and to consummatethe transactions contemplated hereby. The execution and delivery of thisAgreement and the consummation of the transactions contemplated hereby havebeen duly authorized by all necessary corporate action on the part of Caliper,and no further action is required on the part of Caliper or the Company toauthorize this Agreement and the transactions contemplated hereby. ThisAgreement has been duly executed and delivered by 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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Caliper and, assuming the due authorization,execution and delivery by the other parties hereto, constitutes the valid andbinding obligation of Caliper, enforceable against Caliper in accordance withits terms, except as such enforceability may be subject to the Laws of generalapplication relating to bankruptcy, insolvency and the relief of debtors and rules ofLaw governing specific performance, injunctive relief or other equitableremedies.

 

(b)      The Board of Directors ofeach of CLS and Xenogen has unanimously approved this Agreement and thetransactions contemplated by this Agreement.

 

2.5           No Conflict.  The execution and delivery by Caliper of thisAgreement, and the consummation of the transactions contemplated hereby, willnot conflict with or result in any violation of or default under (with orwithout notice or lapse of time, or both) or give rise to a right oftermination, cancellation, modification or acceleration of any obligation,payment of any benefit, or loss of any benefit (any such event, a “Conflict”)under (i) any provision of the Company Charter Documents; (ii) exceptas set forth in Section 2.5 of the Disclosure Schedule, any mortgage,indenture, lease, contract (whether written or oral), covenant or otheragreement, instrument or commitment, permit, concession, franchise or license(each a “Contract” and collectively the “Contracts”) to which anyCaliper Company, or any of its respective properties or assets (whethertangible or intangible) is a party or, as the case may be, subject; or(iii) any Law applicable to any Caliper Company, or any of its respectiveproperties (whether tangible or intangible) or assets.. As a result of theconsummation of the transactions contemplated by this Agreement, the Companywill not be prohibited from exercising any of its rights under any of theContracts to which it is a party or a sublicensee, and Taconic will not berequired to pay any additional amounts or consideration other than ongoingfees, royalties or payments, which the Company would otherwise be required topay pursuant to the terms of such Contracts had the transactions contemplatedby this Agreement not occurred, except as may be required in connection withobtaining rights to use the Specified Third Party Intellectual Property..

 

2.6           Governmental Consents.  Except as set forth in Section 2.6 ofthe Disclosure Schedule, no consent, waiver, approval, order or authorizationof, or registration, declaration or filing with any court, administrativeagency or commission or other federal, state, county, local or foreigngovernmental authority, instrumentality, agency or commission (each, a “GovernmentalEntity”), is required by or with respect to the Company in connection withthe execution and delivery of this Agreement or the consummation of thetransactions contemplated hereby.

 

2.7           Company Financial Statements.

 

(a)      Section 2.7(a) of theDisclosure Schedule sets forth (i) the Company’s unaudited  balance sheets as of December 31, 2007and December 31, 2008, and the related unaudited  statements of income for each fiscal yearthen ended and (ii) the Company’s unaudited  balance sheets as of the end of each calendarmonth since December 31, 2008, and the related unaudited statement ofincome for each of the calendar months then ended, together with the equivalentfinancial statements in the prior fiscal year (all of the foregoing financialstatements of the Company and any notes thereto are hereinafter collectivelyreferred to as the “Financial Statements”). The Financial Statements aretrue and correct in all material respects and have been prepared in allmaterial respects in accordance with GAAP consistently applied on a basisconsistent throughout the periods indicated and consistent with each other. TheFinancial Statements present fairly, in all material respects, the financialcondition and 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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operating results of the Company as of the dates andduring the periods indicated therein, subject to normal year-end adjustments inthe case of interim Financial Statements, which are not material in amount.Caliper maintains with respect to the Company a standard system of accountingestablished and administered in accordance with GAAP. The Company’s unauditedconsolidated balance sheet as of November 30, 2009, is referred tohereinafter as the “Current Balance Sheet.”

 

(b)      The Company maintains asystem of internal accounting controls and procedures, which internalaccounting controls and procedures are sufficient to provide reasonableassurance that (i) transactions by the Company are executed withmanagement’s authorization, (ii) transactions by the Company are recordedas necessary to permit preparation of financial statements in accordance withGAAP and to maintain accountability for assets, (iii) access to assets ofthe Company is permitted only in accordance with management’s authorization,and (iv) the recorded accountability for assets of the Company is comparedwith existing assets at reasonable intervals and appropriate action is takenwith respect to any differences. Caliper has not identified or been made awareof (A) any significant deficiency or material weakness in the system ofinternal accounting controls utilized by it that may affect the FinancialStatements, (B) any fraud, whether or not material, that involves theemployees of the Company or (C) any claim or allegation regarding any ofthe foregoing.

 

2.8           No Undisclosed Liabilities.  Except as set forth in Section 2.8 ofthe Disclosure Schedule, the Company does not have any obligation, expense,claim, deficiency, guaranty or endorsement of any type, including anyinter-company items, whether accrued, absolute, contingent, matured, unmaturedor other (whether or not required to be reflected in financial statements inaccordance with GAAP), except liabilities which individually or in theaggregate (i) have been reflected in the Current Balance Sheet ordisclosed in the notes thereto (to the extent of such reflection ordisclosure), (ii) have arisen in the Ordinary Course of Business since thedate of the Current Balance Sheet, or (iii) are executory non-materialobligations arising in the Ordinary Course of Business (and not as a result ofthe breach of any Contract identified in Sections 2.13 or 2.15hereof).

 

2.9           No Changes.  Except as set forth in Section 2.9 ofthe Disclosure Schedule, since the date of the Current Balance Sheet, there hasor have not been, occurred or arisen any:

 

(a)      transaction by the Companythat is material to the Company, except in the Ordinary Course of Business;

 

(b)      amendment or change to theCompany Charter Documents;

 

(c)      capital expenditure orcommitment by the Company exceeding $25,000individually or $50,000 inthe aggregate;

 

(d)      payment, discharge orsatisfaction, in any amount in excess of $10,000 in any one case, or $25,000 in the aggregate, of any claim or Liability, other than payment,discharge or satisfaction of claims, liabilities and obligations in theOrdinary Course of Business or of liabilities reflected or reserved against inthe Current Balance Sheet;

 

(e)      destruction of, damage to,or loss of any assets (whether tangible or intangible) of the Company with abook value in excess of $10,000 in any one case or $25,000 in the aggregate,whether or not covered by insurance;

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(f)       labor dispute or claim ofwrongful discharge or other unlawful labor practice or action with respect tothe Company;

 

(g)      change in accounting methodsor practices (including any change in depreciation or amortization policies orrates) by the Company other than as required by GAAP;

 

(h)      change in any materialelection in respect of Taxes, adoption or change in any material accountingmethod in respect of Taxes, material agreement or settlement of any claim orassessment in respect of Taxes, or extension or waiver of the limitation periodapplicable to any claim or assessment in respect of Taxes;

 

(i)       revaluation by the Companyof any of its assets (whether tangible or intangible);

 

(j)       declaration, setting asideor payment of a dividend or other distribution (whether in cash, stock orproperty) in respect of any capital stock of the Company, or any split,combination or reclassification in respect of any shares of capital stock ofthe Company, or any issuance or authorization of any issuance of any othersecurities in respect of, in lieu of or in substitution for shares of capitalstock of the Company, or any direct or indirect repurchase, redemption or otheracquisition by the Company of any shares of capital stock of the Company (oroptions, warrants or other rights convertible into, exercisable or exchangeabletherefor);

 

(k)      increase in the base salaryor other compensation payable or to become payable by the Company to anyCompany Personnel, or the declaration, payment, commitment or obligation of anykind for the payment by the Company of a severance payment, terminationpayment, bonus or other additional salary or compensation to any such person;

 

(l)       entering into of anymaterial Contract to which the Company is a party or by which the Company, anyof its assets (whether tangible or intangible) are bound or any termination,extension, material amendment or modification of the terms of any materialContract to which the Company is a party or by which it or any of its assetsare bound;

 

(m)     sale, lease, license orother disposition of any of the material assets (whether tangible orintangible) or material properties of the Company taken as a whole, includingthe sale of any accounts receivable of the Company, or any creation of anysecurity interest in any such material assets or material properties;

 

(n)      outstanding loan by theCompany to any person or entity, incurring by the Company of any Indebtedness,guaranteeing by the Company of any Indebtedness, issuance or sale of any debtsecurities of the Company or guaranteeing of any debt securities of others,except for advances to Company Personnel for travel and business expenses inthe Ordinary Course of Business;

 

(o)      granting of any waiver orrelease by the Company of any right or claim material to the Company, includingany write-off or other compromise of any account receivable of the Companyexceeding $5,000 individually or $25,000 in the aggregate;

 

(p)      commencement, settlement,notice or, to the Knowledge of Caliper, threat, of any lawsuit or proceeding orother investigation against the Company;

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(q)      notice of any claim orpotential claim of ownership by any person other than the Company of theintellectual property owned, developed or created by the Company or of anyclaim or potential claim of infringement by the Company of any other person’sintellectual property;

 

(r)       issuance or sale, orcontract to issue or sell, by the Company of any Shares or any securitiesconvertible into, or exercisable or exchangeable for, Shares, or anysecurities, warrants, options or rights to purchase any of the foregoing,except for issuances of Shares upon the exercise thereof;

 

(s)      (i) sale or license bythe Company of any Company Intellectual Property or execution of any agreementwith respect to any Company Intellectual Property, (ii) purchase orlicense by the Company of any Intellectual Property or execution of anyagreement with respect to the Intellectual Property of any person or entity,(iii) agreement by the Company with respect to the development of anyIntellectual Property with a third party, or (iv) material change inpricing or royalties set or charged by the Company to their customers orlicensees or in pricing or royalties set or charged by persons who havelicensed Intellectual Property to the Company, except in the case of clause (i) or(ii), with respect to non-exclusive end user licenses of object code in theOrdinary Course of Business and on the Company’s standard terms and conditions;

 

(t)       agreement or materialmodification to any agreement pursuant to which any other party was grantedmarketing, distribution, development or similar rights of any type or scopewith respect to any products or technology of the Company;

 

(u)      event or condition of anycharacter that has had or is reasonably likely to have a Company MaterialAdverse Effect; or

 

(v)      agreement by the Company, orany officer or employee on behalf of the Company, to do any of the thingsdescribed in the preceding clauses (a) through (u) of this Section 2.9.

 

2.10         Tax Matters,

 

(a)      The Company has filed allmaterial Tax Returns that it was required to file under applicable Tax Laws andsuch Tax Returns were true, correct and complete in all material respects andwere prepared in compliance in all material respects with all applicable TaxLaws.  All Taxes required to be paid bythe Company have been timely paid, whether or not shown on any Tax Return,except for any Taxes for which there have been proper accruals under GAAP andare reserved on the Current Balance Sheet. The Company is not currently the beneficiary of any extension of timewithin which to file any Tax Return. Since January 1, 2005, no claim has been made by a GovernmentalEntity in a jurisdiction in which the Company does not file Tax Returns thatthe Company is or may be subject to taxation by that jurisdiction and toCaliper’s Knowledge, no such jurisdiction has any reasonable basis for such aclaim.  There are no Liens for Taxes uponany of the property or assets of the Company other than for Taxes that are notyet due and payable or for non-material Taxes that are being contested in goodfaith and for which there have been proper accruals under GAAP and are reservedfor on the Current Balance Sheet.  TheCompany has not waived any statute of limitations in respect of any Taxes oragreed to any extension of time with respect to a Tax assessment or deficiency.

 

(b)      Each Affiliated Group hasfiled all material Tax Returns that it was required to file under applicableTax Laws for each taxable period during which the Company was a 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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member of such Affiliated Group.  All such Tax Returns were true, correct andcomplete in all material respects and were prepared in compliance with allapplicable Tax Laws.  All Taxes requiredto be paid by any Affiliated Group have been timely paid for each taxableperiod during which the Company was a member of such Affiliated Group, whether ornot shown on any Tax Return, except for any Taxes for which there have beenproper accruals under GAAP and are reserved on the Current Balance Sheet.  To the Knowledge of Caliper, no GovernmentalEntity is expected to assess any additional Taxes against any Affiliated Groupfor any taxable period during which the Company was a member of such AffiliatedGroup.  There is no dispute or claimconcerning any Tax Liability of any Affiliated Group for any taxable periodduring which the Company was a member of such Affiliated Group either (i) claimedor raised by any Governmental Entity in writing or (ii) as to whichCaliper has Knowledge based upon personal contact with any agent of suchGovernmental Entity.  No Affiliated Grouphas waived any statute of limitations in respect of any Taxes or agreed to anyextension of time with respect to any Tax assessment or deficiency, in eachcase for any taxable period during which the Company was a member of suchAffiliated Group.

 

(c)      TheCompany has complied in all material respects with all applicable Laws, rules andregulations relating to the payment and withholding of Taxes (including withoutlimitation amounts paid or owing to any employee, independent contractor,creditor, stockholder, foreign person or entity, or other third party). TheCompany has, within the time and the manner prescribed by Law, withheld andpaid over to the proper Governmental Entities all amounts required to be sowithheld and paid over under applicable Laws, and all Tax Returns or otherforms required to be filed with respect thereto have been properly completedand timely filed.

 

(d)      Section 2.10(d) of the Disclosure Schedule (i) lists allfederal, state, local, and foreign jurisdictions to which any Tax is properlypayable by or with respect to either the Company (ii) lists the type ofTax or Taxes payable in such jurisdiction, (iii) lists all Tax Returnsfiled by, on behalf of or with respect to the Company in each such jurisdictionfor each taxable period ended on or after January 1, 2005, (iv) indicatesthose Tax Returns that have been audited or are currently the subject of audit,and (v) lists any written document received by the Company from anyGovernmental Entity indicating an intent to open an audit or other review,requesting information related to Tax matters, or providing notice ofdeficiency or of proposed adjustment for any amount of Tax.  The Company has delivered or caused to bedelivered to Taconic true, correct and complete copies of all Tax Returns filedwith respect to the Company and all federal, state, local, and foreignexamination reports or statements of deficiencies assessed against or agreed toby the Company received since January 1, 2005.

 

(e)      The Company is not a party to any agreement,contract, arrangement, or plan that has resulted or could result, separately orin the aggregate, in the payment of (i) any “excess parachute payment”within the meaning of Section 280G of the Code (or any correspondingprovision of state, local, or foreign Tax Law) or (ii) any amount forwhich a deduction would be disallowed or deferred under Section 162 or Section 404of the Code (or any corresponding provision of state, local, or foreign TaxLaw).

 

(f)       The Company has never been a United States realproperty holding corporation within the meaning of Section 897(c)(1)(A)(ii) ofthe Code.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(g)      The Company is not a party to or member of anyjoint venture, partnership, limited liability company or other arrangement orcontract with any third party which could be treated as a partnership forfederal income tax purposes.  The Companyis not a party to or bound by any Tax allocation or sharing agreement.  Since January 1, 2001, the Company hasnever been a member of a group filing a consolidated federal income Tax Returnor a combined, consolidated, unitary or other affiliated group Tax Return forstate, local or foreign Tax purposes (other than a group the only member ofwhich is the Company or a group the common parent of which was either CLS orXenogen), and the Company does not have any Liability for the Taxes of anyperson or entity as a consequence of being a member of a group filing aconsolidated federal income Tax Return or a combined, consolidated, unitary orother affiliated group Tax Return for state, local or foreign Tax purposesprior to January 1, 2001.  TheCompany does not have any Liability for the Taxes of any person or entity(other than the Caliper Companies) under Treasury Regulation Section 1.1502-6(or any corresponding provision of state, local or foreign Tax Law), or as atransferee or successor, or by contract, or otherwise.

 

(h)      Section 2.10(h) of the Disclosure Schedule sets forth thefollowing information with respect to the Company as of the most recentpracticable date: (i) the Tax basis of each asset held by the Company; (ii) theamount of any net operating loss carryover, net capital loss carryover, unusedinvestment or other credit, unused foreign tax credit, or excess charitablecontribution allocable to the Company, as allowable under the Code, and afterapplication, as applicable, of Treasury Regulations under Section 1502 ofthe Code, including without limitation Treasury Regulation Section 1.1502-21(or any similar provisions of applicable state, local, or foreign Law); and (iii) theamount of any deferred gain or loss allocable to the Company arising out of anyintercompany transaction.

 

(i)       The unpaid Taxes of the Company(whether currently accrued or accruing prior to the Closing Date, asapplicable) (i) did not, as of November 30, 2009, exceed the reserve for Tax Liability (excluding anyreserve for deferred Taxes established to reflect timing differences betweenbook and Tax income) set forth on the face of the Current Balance Sheet (ratherthan in any notes thereto) and (ii) do not exceed that reserve as adjustedfor the passage of time through the Closing Date in accordance with the pastcustom and practice of the Company in filing its Tax Returns.  Since November 30, 2009, the Company has not incurred anyLiability for Taxes accruing after such date other than unpaid Taxes arising inthe Ordinary Course of Business.

 

(j)       The Company has not made any change in accountingmethods or related-party transaction pricing, or received a ruling from anyGovernmental Entity or signed an agreement with respect thereto, with respectto any Tax year.  The Company is not requiredto include in income any adjustment pursuant to Section 481(a) of theCode by reason of any change in accounting method, pursuant to Section 482of the Code by reason of any adjustment to pricing among related parties, orpursuant to any similar provisions of applicable state, local, or foreign Lawby reason of changes in accounting method or adjustments to pricing amongrelated parties; nor has any Governmental Entity proposed any such change ofaccounting method or adjustment to related-party pricing.  The Company will not be required to includeany item of income in, or exclude any item of deduction from, taxable incomefor any taxable period (or portion thereof) as a result of any: (i) “closingagreement” as described in Section 7121 of the Code (or anycorresponding or similar provision of state, local, or foreign Law) 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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executed on or prior to the Closing Date; (ii) intercompanytransaction or excess loss account described in the Treasury Regulations underSection 1502 of the Code (or any corresponding or similar provision ofstate, local, or foreign Law); (iii) installment sale or open transactiondisposition made on or prior to the Closing Date; or (iv) prepaid amountreceived on or prior to the Closing Date. No indebtedness of the Company constitutes “corporate acquisitionindebtedness” within the meaning of Section 279(b) of the Code(ignoring for this purpose Section 279(b)(4) of the Code).  The Company has not distributed stock ofanother person or entity, or has had its stock distributed by another person orentity, in a transaction that was purported or intended to be governed in wholeor in part by Sections 355 or 361 of the Code.

 

(k)      The Company does not own,directly or indirectly, any interests in an entity that has been or would betreated as a “passive foreign investment company” within the meaning of Section 1297of the Code or as a “controlled foreign corporation” within the meaning of Section 957of the Code.  The Company has not filed aconsent under Section 341(f) of the Code (as in effect prior toPublic Law 108-27) concerning collapsible corporations, and Section 341(f)(2) ofthe Code (as in effect prior to Public Law 108-27) does not apply to any assetsof the Company.  No power of attorneywith respect to the Company with respect to any matter relating to Taxes iscurrently in effect.  Except as set forthin Section 2.10(k) of the Disclosure Schedule, no election under Section 108,441 or 1017 of the Code has been made by or with respect to the Company.

 

(l)       The Company is in fullcompliance with all terms and conditions of any Tax exemption, Tax holiday orother Tax reduction agreement or order of a Governmental Entity, and theconsummation of the transactions contemplated by this Agreement will not haveany adverse effect on the continued validity and effectiveness of any such Taxexemption, Tax holiday or other Tax reduction agreement or order.  The Company has no cash or other assets thathas been or may be delivered to a Governmental Entity (or public officialthereof) pursuant to any applicable abandoned property, escheat or similar Law.

 

(m)     Since at least January 1,2005, the Company has not taken any deduction or received any Tax benefitarising with respect to any “reportable transaction” as defined in Section 6707A(c) ofthe Code (or any corresponding provision of state, local or foreign TaxLaw).  Each position on any federal orstate income Tax Return that relates to the Company and that could give rise toa substantial understatement penalty under Section 6662 of the Code hasbeen adequately disclosed on such Tax Return.

 

(n)      For purposes of this Section 2.10,any reference to the Company shall be deemed to include the Company and anyentity that merged or was liquidated into the Company.

 

2.11         Restrictions on Business Activities.  There is no agreement (non-competition orotherwise), commitment, judgment, injunction, order or decree to which theCompany is a party or that is otherwise binding upon the Company that has ormay reasonably be expected to have the effect of prohibiting or impairing anypresent business practice of the Company, any acquisition of property (tangibleor intangible) by the Company, the conduct of business by the Company, orotherwise limiting the freedom of the Company to engage in any line of businessor to compete with any person, except for license agreements entered into bythe Company in the Ordinary Course of Business that limit the Company’s use oflicensed technology to a defined field of use. Without limiting the generalityof the foregoing, and except for such license 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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agreements,the Company has not entered into any agreement under which the Company isrestricted from selling, licensing or otherwise distributing any of itstechnology or products or from providing services to customers or potentialcustomers in any geographic area, during any period of time or in any segmentof the market.

 

2.12         Title to Properties; Absence of Liens and Encumbrances;Condition of Equipment.

 

(a)      The Company does not own anyreal property, nor has the Company ever owned any real property.  Section 2.12(a) of theDisclosure Schedule sets forth a list of all real property currently leased bythe Company or otherwise used or occupied by the Company for the operation ofthe Company’s businesses (the “Leased Real Property”), together with thename of the lessor, the date of the lease and each amendment thereto and, withrespect to any current lease, the aggregate annual rental payable under anysuch lease. All such current leases are in full force and effect, are valid andeffective in accordance with their respective terms, and there is not, underany of such leases, any existing default or event of default (or event whichwith notice or lapse of time, or both, would constitute a default) by theCompany or, to the Knowledge of Caliper, by any other party thereto.

 

(b)      Caliper has delivered toTaconic true, correct and complete copies of all leases, lease guaranties,subleases, agreements for the leasing, use or occupancy of, or otherwisegranting a right in or relating to the Leased Real Property, including allamendments, terminations and modifications thereof (the “Lease Agreements”);and there are no other Lease Agreements affecting the Leased Real Property orto which the Company is bound.  TheCompany has not received any notice of a default, alleged failure to perform,or any offset or counterclaim with respect to any such Lease Agreement, whichhas not been fully remedied and withdrawn. The consummation of the transactions contemplated by this Agreement willnot affect the enforceability against any person of any such Lease Agreement orthe rights of the Company to the continued use and possession of the LeasedReal Property for the conduct of business as presently conducted.

 

(c)      The Leased Real Property andany improvements thereon (i) are in good operating condition and repair, (ii) tothe Knowledge of the Caliper, are free from structural, physical and mechanicaldefects, (iii) are maintained in a manner consistent with standardsgenerally followed with respect to similar properties, and (iv) to theKnowledge of Caliper, are structurally sufficient and otherwise suitable forthe conduct of the business of the Company as presently conducted.

 

(d)      The Company has good andvalid title to, or, in the case of leased properties and assets, validleasehold interests in, all of its tangible properties and assets, real,personal and mixed, used or held for use in its business, free and clear of anyjudgments or Liens, except (i) as reflected in the Current Balance Sheetor the notes thereto, (ii) Liens for Taxes, assessments and similarcharges which are not yet due and payable, or non-material items that are beingcontested in good faith, (iii) Liens securing Indebtedness of the Companyand its Affiliates owing to Silicon Valley Bank, which Liens will be releasedas of the Closing, and (iv) such imperfections of title and encumbrances,if any, that do not materially detract from the value or materially interferewith the present use of the property subject thereto or affected thereby.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’s applicationrequesting confidential treatment under Rule 24b-2 of the SecuritiesExchange Act of 1934, as amended.

 

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(e)      Section 2.12(e) of theDisclosure Schedule lists all items of equipment (the “Equipment”) witha book value in excess of $5,000 andowned or leased by the Company, and such Equipment is (i) adequate for theconduct of the business of the Company as currently conducted, and (ii) ingood operating condition, regularly and properly maintained, subject to normalwear and tear.

 

(f)       The Company has the validright to use, unrestricted by contract or statute, all customer lists, customercontact information, customer correspondence and customer licensing andpurchasing histories relating to the Company’s current and former customers.

 

(g)      All improvements on theLeased Real Property (i) substantially conform to all applicable Laws,including zoning and building ordinances and health and safety ordinances, andsuch Leased Real Property is zoned for the various purposes for which theleased Real Property and improvements thereon are presently being used, and (ii) areadequate and sufficient for the operation of the business of the Company aspresently conducted.  The Company has notreceived notice from any Governmental Entity or lessor requiring material workto be done or material improvements to be made upon any of the Leased RealProperty and, to the Knowledge of Caliper, no such work or improvements hasbeen or will be requested by any other person.

 

2.13         Intellectual Property.

 

(a)      Section 2.13(a) of theDisclosure Schedule sets forth a complete and accurate list of each and everyagreement relating to Licensed—In Intellectual Property (excluding software anddatabases licensed to the Company under standard non-exclusive softwarelicenses granted to end-user customers by third parties in the ordinary courseof such third parties’ business) and Licensed-Out Intellectual Property(collectively, “Licensed Company Intellectual Property”), in each case specifyingthe parties to the agreement.  [***]there are [***] regarding the scope of [***], or with respect to [***].** **All agreementsrelating to the Licensed Company Intellectual Property are in full force andeffect and will be in full force and effect immediately after the Closing, andthe Company will be entitled to the full benefit thereof.

 

(b)      Section 2.13(b) of theDisclosure Schedule sets forth the following Owned Company IntellectualProperty Right: (i) all registered Trademarks and material unregisteredTrademarks; (ii) all Patents and (iii) all registered Copyrights, andall applications for any of the foregoing, in each case listing, as applicable,(A) the name of the applicant/registrant and current owner, (B) thejurisdiction where the application/registration is located and (C) theapplication or registration number. All of the Owned Company IntellectualProperty is valid and subsisting. All logbooks, documents and recordssupporting the creation and ownership of Intellectual Property have beenconfidentially retained by the Company. All necessary documents and certificates in connection with such OwnedCompany Intellectual Property have been filed with the relevant patent,copyright, trademark or other authorities in the United States or elsewhere inthe world, as the case may be, for the purposes of perfecting, prosecuting andmaintaining such Owned Company Intellectual Property.  There are no actions that must be taken bythe Company within 150 days of the date of this Agreement, including thepayment of any registration, maintenance or renewal fees or the filing of anyresponses to Governmental Entity office actions, documents, applications orcertificates for the purposes of obtaining, maintaining, perfecting orpreserving or renewing any Owned Company Intellectual Property.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(c)      Section 2.13(c) of theDisclosure Schedule contain, respectively, a complete and accurate list of allproducts and services marketed by the Company in the year preceding the datehereof (the “Company Products and Services”).

 

(d)      There are no Domain Nameregistrations owned by the Company.

 

(e)      In each case in which theCompany has acquired ownership of any Trademark, Copyright, or Patent currentlyincluded in the Owned Company Intellectual Property from another person (eachof which are identified in Section 2.13(b) of the DisclosureSchedule), the Company has obtained a valid and enforceable assignmentsufficient to irrevocably transfer all rights in and to all such IntellectualProperty to the Company has, in the case of a Patent, Trademark or registeredCopyright, recorded or had recorded each such assignment with the U.S. Patentand Trademark Office, the U.S. Copyright Office, or their respectiveequivalents in the applicable jurisdiction, in each case in accordance withapplicable Laws.

 

(f)       The Company IntellectualProperty is sufficient for the conduct of the business of the Company as it iscurrently conducted, except that Taconic acknowledges that (i) Taconic willneed the third party intellectual property specified in Section 2.13(f) ofthe Disclosure Schedule in order to conduct portions of the light producingtransgenic animal or *in vivo* imagingbusiness (the “Specified Third Party Intellectual Property”) and (ii) thenature of the Company’s business is such that additional license rights to celllines, reagents or other technologies may be required from time to time in thefuture, depending on the types of services performed by the Company after thedate hereof (it being understood and represented that no such license rightsare currently required in the conduct of the business of the Company aspresently conducted, except for the Specified Third Party IntellectualProperty). The Company Intellectual Property, together with the IntellectualProperty to be licensed to the Company by Caliper effective as of the Closing(which licenses to Intellectual Property are described in Sections 5.1(c), 5.2(d) and5.2(e)) constitutes all Intellectual Property and Intellectual Property Rightsused by the Company in its business, except for the Specified Third PartyIntellectual Property).

 

(g)      The Company owns all right,title and interest in the Owned Company Intellectual Property, free and clearof all Liens other than encumbrances, restrictions or other obligationsexpressly set forth in any of the Licensed Company Intellectual Property,except as set forth in Section 2.13(g) of the Disclosure Schedule.All Owned Company Intellectual Property was created solely by either (i) employeesof the Company acting within the scope of their employment or (ii) bythird parties who have validly and irrevocably assigned all of their rightstherein to the Company, and no third party owns or has any rights to any of theOwned Company Intellectual Property. No Company Personnel owns or has a licenseto any Company Intellectual Property.

 

(h)      The Company has takenreasonable and appropriate steps to protect and preserve the confidentiality ofany trade secrets that comprise any part of the Company Intellectual Property,and, to the Knowledge of Caliper, there have not occurred any unauthorizeduses, disclosures or infringements of any such trade secrets by any person. Alluse and disclosure by the Company of Trade Secrets owned by another person havebeen pursuant to the terms of a written agreement with such person or wasotherwise lawful. Without limiting the foregoing, the Company has a validconfidentiality and assignment agreement, substantially 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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in the Company’s standard form previously deliveredto Taconic, in place with each employee and contractor who has ever createdIntellectual Property, except for any failure to have such an agreement inplace that has not had and would not reasonably be expected to have a CompanyMaterial Adverse Effect. To the extent necessary, since January 1, 2001,the Company has enforced such agreements.

 

(i)       Except as set forth in Section 2.13(i) ofthe Disclosure Schedule, none of the Company’s Products and Services, nor anyother operation of the Company’s business, has infringed upon or otherwiseviolated, or is infringing upon or otherwise violating, in any respect theIntellectual Property Rights of any third party.  To the Knowledge of Caliper as of the datehereof, no person or any of such person’s products or services or otheroperation of such person’s business is infringing upon or otherwise violatingany Company Intellectual Property.

 

(j)       There is no suit, claim,action, investigation or proceeding made, conducted or brought by a third partythat has been served upon or, to the Knowledge of Caliper, filed or threatenedwith respect to, and the Company has not been notified in writing of, anyalleged infringement or other violation by the Company or any of the Company’sProducts and Services or other operation of the Company’s business of theIntellectual Property Rights of such third party, except as set forth in Section 2.13(j) ofthe Disclosure Schedule.  To theKnowledge of Caliper, there is no pending or threatened claim challenging thevalidity or enforceability of, or contesting the Company’s rights with respectto, any of the Company Intellectual Property. The Company has not received any opinion of counsel regarding (i) anypotential allegation of infringement, (ii) the application of any Patentto the Company Products and Services, or (iii) the operation of theCompany’s business. The Company is not subject to any order of any GovernmentalEntity that restricts or impairs the use, transfer or licensing of any CompanyIntellectual Property.

 

(k)      The execution and deliveryof this Agreement and the consummation of the transactions contemplated hereby(including the Transaction) will not result in (i) the Company granting toany third party or to a Caliper Company any rights or licenses to anyIntellectual Property or Intellectual Property Rights, (ii) any right oftermination or cancellation under any Licensed Company Intellectual Property, (iii) theimposition of any Lien on any Owned Company Intellectual Property, or (iv) afterthe Transaction, Taconic, the Company or any of Taconic’s other Subsidiariesbeing required, under the terms of any agreement to which the Company is aparty, to grant any third party or a Caliper Company any rights or licenses toany of Taconic’s or any of its Subsidiaries’ Intellectual Property orIntellectual Property Rights or to pay any royalties or other amounts in excessof those that would have, in any event, been payable by the Company had thetransactions contemplated by this Agreement not occurred. Section 2.13(k) ofthe Disclosure Schedule contains a complete and accurate list as of the datehereof of all “open source” software that is used by the Company in connectionwith the Company’s business or incorporated in or used in connection with anyof the Company’s Products and Services. To the Knowledge of Caliper, theCompany has not violated any license related to any open source software usedby the Company.

 

(l)       None of the proprietary orconfidential information related to Company Products and Services or tradesecrets included within Company Intellectual Property have been published ordisclosed by the Company, except to its employees or advisers or pursuant tonon-disclosure agreements, or, to the Knowledge of Caliper, by any other personexcept as authorized by the Company under a non-disclosure agreementenforceable by the Company.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(m)     The Company’s collection anddissemination of personal customer information in connection with theirbusiness has been conducted in material compliance with applicable privacypolicies published or otherwise adopted by the Company and any applicable Law.

 

(n)      To the Knowledge of Caliper,no government funding, facilities of a university, college, other educationalinstitution or research center or funding from third parties was used in thedevelopment of any Owned Company Intellectual Property.  To the Knowledge of Caliper, no CompanyPersonnel who was involved in, or who contributed to, the creation ordevelopment of any such Owned Company Intellectual Property, has performedservices for the government, university, college, or other educationalinstitution or research center during a period of time during which suchCompany Personnel was also performing services for the Company.

 

(o)      If the Company has exportedthe Company Products and Services, or any technical information or othertechnology within its control, it has done so in material compliance with therequirements of U.S. export Laws, as promulgated and enforced by the Bureau ofExport Administration.

 

2.14         Sufficiency of Assets.  Except as set forth in Section 2.14 ofthe Disclosure Schedule, the assets currently owned by the Company, or whichthe Company otherwise has the right to use without requirement of payment toany Caliper Company or any third party, are sufficient for the conduct of theCompany’s business as presently conducted, except that Taconic acknowledgesthat (i) Taconic will need the Specified Third Party Intellectual Propertyand (ii) the nature of the Company’s business is such that additionallicense rights to cell lines, reagents or other technologies may be requiredfrom to time in the future, depending on the types of services performed by theCompany after the date hereof (it being understood and represented that no suchlicense rights are currently required by Caliper or the Company except for theSpecified Third Party Intellectual Property). Such assets constitute all assets used by the Company in its business,except for the Specified Third Party Intellectual Property.

 

2.15         Contracts.  Except as set forth in Section 2.15 ofthe Disclosure Schedule, as of the date hereof, the Company is not a party to,or is not bound by:

 

(a)      any employment or consultingContract with an employee or individual consultant or salesperson, orconsulting or sales Contract with a firm or other organization to provideservices to the Company;

 

(b)      any agreement or plan,including any stock option plan, stock appreciation rights plan, phantom stockplan or stock purchase plan, any of the benefits of which will be increased, orthe vesting of benefits of which will be accelerated, by the occurrence of anyof the transactions contemplated by this Agreement, or the value of any of thebenefits of which will be calculated on the basis of any of the transactionscontemplated by this Agreement;

 

(c)      any fidelity or surety bondor completion bond;

 

(d)      any lease of personalproperty having a value in excess of $10,000 individually or $25,000 inthe aggregate;

 

(e)      any Contract relating tocapital expenditures and involving future payments in excess of $25,000individually or $50,000 in the aggregate;

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(f)       any Contract relating to thedisposition or acquisition of assets or any interest in any business enterpriseoutside the Company’s Ordinary Course of Business;

 

(g)      any mortgage, indenture,guarantee, loan or credit agreement, security agreement or other agreement orinstrument relating to the borrowing of money or extension of credit;

 

(h)      any purchase order orContract for the purchase of materials involving in excess of $10,000 individually or $25,000 in the aggregate;

 

(i)       any dealer, distribution,joint marketing or development Contract;

 

(j)       any sales representative,original equipment manufacturer, value added, remarketer, reseller, orindependent software vendor, or other Contract for use or distribution of theCompany’s products, technology or services; or

 

(k)      any other Contract that involves(i) annually $10,000 individuallyor $25,000 in the aggregate ormore and is not cancelable without penalty within thirty (30) days, (ii) minimumpurchase commitments by the Company, (iii) ongoing service or supportobligations in excess of $10,000 individually or $25,000 in the aggregate thatare not cancelable without penalty or refund within thirty (30) days, or (iv) thedevelopment or delivery of any customer-specified product enhancements orupgrades.

 

TheCompany does not have any cash or other obligations to any person under or withrespect to a Contract in connection with returns, rebates, co-marketingarrangements, service level agreements, most-favored nations undertakings,price protection mechanisms, or warranties.

 

2.16         No Defaults.  The Company is in material compliance withand has not materially breached, violated or defaulted under, or receivednotice that it has materially breached, violated or defaulted under, any of theterms or conditions of any Contract required to be disclosed under Sections 2.13or 2.15 hereof, nor is the Company aware of any event that would constitutesuch a breach, violation or default with the lapse of time, giving of notice orboth.  Each Contract required to bedisclosed under Sections 2.13 or 2.15 hereof is in fullforce and effect, and the Company is not in material default thereunder, nor tothe Knowledge of Caliper is any other party to any such Contract in materialdefault thereunder.  The consummation ofthe transactions contemplated by this Agreement will neither violate nor resultin the breach, modification, cancellation, termination or suspension (with thelapse of time, giving of notice or both) of any Contract required to bedisclosed under Sections 2.13 or 2.15 hereof.  Except as set forth in Section 2.16 ofthe Disclosure Schedule, the transfer, assignment and delegation of all rightsand obligations under the Contracts required to be disclosed under Sections 2.13or 2.15 hereof in connection with the consummation of the transactionscontemplated by this Agreement will not require the consent of any party tosuch Contracts.  Following the ClosingDate, the Company will be permitted to exercise all of the Company’s rightsunder the Contracts required to be disclosed under Sections 2.13 or2.15 hereof to the same extent the Company would have been able to hadthe transactions contemplated by this Agreement not occurred and without beingrequired to pay any additional amounts or consideration other than fees,royalties or payments which the Company would otherwise be required to pay hadsuch transactions contemplated hereby not occurred.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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2.17         Interested Person Transactions.

 

(a)      Except for intercompanytransactions and services among the Caliper Companies in the Ordinary Course ofBusiness as described in Section 2.17 of the Disclosure Schedule (the “IntercompanyTransactions”), none of Caliper Companies and none of the officers anddirectors of any of the Caliper Companies, nor any ancestor, sibling, descendantor spouse of any of such persons, or any trust, partnership, corporation orother entity in which any of such persons has or has had an interest, (an “InterestedPerson”), has or has had, directly or indirectly, (i) an economicinterest in any entity which furnished or sold, or furnishes or sells,services, products or technology that the Company furnishes or sells, orproposes to furnish or sell, or (ii) any economic interest in any entitythat purchases from or sells or furnishes to the Company, any services,products or technology, or (iii) a beneficial interest in any Contract towhich the Company is a party, except in the case of clause (iii) in anysuch person’s capacity as an officer, director or stockholder of the Company; *provided, however,* that ownership of no more than fivepercent (5%) of the outstanding voting stock of a private corporation, or onepercent (1%) of the outstanding voting stock of a publicly traded corporation,shall not be deemed to be an “interest in any entity” for purposes of this Section 2.17.

 

(b)      Except for the IntercompanyTransactions, all transactions pursuant to which a Caliper Company or any ofits respective officers or directors or any Interested Person has purchased anyservices, products or technology from, or sold or furnished any services,products or technology to, the Company have been on an arms’ length basis onterms no less favorable to the Company than would be available from anunaffiliated party.

 

2.18         Governmental Authorization.  Each consent, license, permit, grant or otherauthorization from any Governmental Entity that is material for the operationof the Company’s business as currently conducted has been issued or granted tothe Company and is in full force and effect and is not affected by the transactionscontemplated hereby.

 

2.19         Litigation.  There is no action, suit, claim or proceedingof any nature pending or, to the Knowledge of Caliper, threatened against theCompany, any of its properties (tangible or intangible) or any of its officers ordirectors in their respective capacities as such.  There is no investigation, inquiry or otherproceeding pending or, to the Knowledge of Caliper, threatened against theCompany, any of its properties (tangible or intangible) or any of its officersor directors in their respective capacities as such by or before anyGovernmental Entity.  No GovernmentalEntity has provided the Company with written notice challenging or questioningthe legal right of the Company to conduct its operations as conducted at thattime or as presently conducted.

 

2.20         Accounts Receivable.

 

(a)      Caliper has delivered toTaconic a list of all accounts receivable of the Company as of the CurrentBalance Sheet Date, together with the respective range of days elapsed sinceeach invoice.

 

(b)      All of the Company’saccounts receivable are bona fide, arose in the ordinary course of business andare carried at values determined in accordance with GAAP, consistently applied,less any reserves for doubtful accounts set forth on the Current Balance Sheetand are collectible in full, net of related reserves. As of the Closing, noperson will have any Lien on any of the Company’s accounts receivable.  No request or agreement for deduction ordiscount has been made with respect to any of the Company’s accountsreceivable.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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2.21         Minute Books.  The minutes of the proceedings of meetingsand written actions of the Board of Directors of the Company since theAcquisition Date provided to Taconic are the only such minutes of the Companyas of the date of this Agreement and contain accurate summaries of all meetingsand actions by written consent of the Board of Directors (or committeesthereof) of the Company since the Acquisition Date.

 

2.22         Environmental Matters.  Without limiting the generality of any otherrepresentations and warranties contained in this Article 2:

 

(a)      Environmental Compliance.  The Company is currently in materialcompliance with and has for the five (5) years prior to the date hereof compliedin all material respects with, and has not received any written or oral noticeor other communication asserting or alleging a violation of, Environmental Lawsor Environmental Orders. Neither the Company nor any of its predecessors hasgenerated, transported, stored, used, managed, manufactured, sold, reclaimed,recycled or disposed of any Hazardous Materials, or any product containing aHazardous Material, except in material compliance with Environmental Laws.

 

(b)      Environmental Liabilitiesand Costs.

 

(i)            None of the Company or theCompany’s real properties, assets, equipment or facilities is subject to anyexisting, pending or, to the Knowledge of Caliper, threatened, and none of theCompany nor any of its predecessors has caused or taken any action that couldresult in, Liability under or relating to Environmental Laws or EnvironmentalOrders (including without limitation Liabilities arising out of themanufacture, processing, distribution, use or sale of any Company Products andServices).

 

(ii)           Without limiting thegenerality of the foregoing:

 

(A)          None of the Company’s or any of its predecessors’current or past operations, and none of the currently or formerly owned realproperties, assets, equipment or facilities of the Company or any of its predecessors,is related to or subject to any investigation or evaluation by any GovernmentalEntity, as to whether any Remedial Action is needed to respond to a Release orthreatened Release of any Hazardous Materials.

 

(B)           Caliper has no Knowledge of any fact or circumstancethat could (i) involve the Company in any litigation or impose upon theCompany any Liability under or relating to Environmental Laws or EnvironmentalOrders (including without limitation Liabilities arising out of themanufacture, processing, distribution, use or sale of any Company Products andServices), or (ii) prevent or interfere with compliance by the Companywith Environmental Laws in the future.

 

(C)           The Company has filed all notices required under anyEnvironmental Law indicating a past or present use, management, 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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handling, transport, recycling, reclamation,treatment, generation, storage or Release of Hazardous Materials.

 

(D)          To Caliper’s Knowledge, there is not now, and therewas not previously, at, on, in or under any of the real properties, assets,equipment or facilities currently owned, leased, operated or otherwise used bythe Company: (i) any treatment, recycling, reclamation, storage ordisposal of any Hazardous Materials, (ii) any underground or above groundstorage tank, surface impoundment, lagoon or other containment facility (pastor present) for the temporary or permanent storage, treatment or disposal ofHazardous Materials (iii) any landfill or solid waste disposal area, (iv) anyasbestos-containing material except in compliance with Environmental Law, (v) anypolychlorinated biphenyls, or (vi) any Release of Hazardous Materialswhich has not been fully remediated in accordance with Environmental Law.

 

(E)           To Caliper’s Knowledge, in relation to realproperties, assets, equipment or facilities previously but no longer owned,leased, operated or otherwise used by the Company or any of its predecessors,there was not during or prior to the time of such ownership, lease, operationor use, at, on, in or under any such real properties, assets, equipment orfacilities: (i) any treatment, recycling, reclamation, storage or disposalof any Hazardous Materials, (ii) any underground or above ground storagetank, surface impoundment, lagoon or other containment facility (past orpresent) for the temporary or permanent storage, treatment or disposal ofHazardous Materials (iii) any landfill or solid waste disposal area, (iv) anyasbestos-containing material except in compliance with Environmental Law, (v) anypolychlorinated biphenyls, or (vi) any Release of Hazardous Materialswhich has not been fully remediated in accordance with Environmental Law.

 

(F)           With the exception of validly issued EnvironmentalPermits and obligations assumed in the Company’s Ordinary Course of Business,the Company is not subject to any Environmental Order from, or contractual orother obligation with, any Governmental Entity or other person in respect ofwhich the Company is required to incur any Loss under or relating toEnvironmental Laws or Environmental Orders, and neither the Company nor any ofits predecessors has entered into any contractual or other obligation with anyGovernmental Entity or other person pursuant to which the Company or any of itspredecessors has assumed responsibility for, either directly or indirectly, theremediation of any condition arising from or relating to the Release orthreatened Release of Hazardous Materials.

 

Portions of this Exhibit were omitted and have been filed separatelywith the Secretary of the Commission pursuant to the Registrant’s applicationrequesting confidential treatment under Rule 24b-2 of the SecuritiesExchange Act of 1934, as amended.

 

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(G)          None of the real properties, assets, equipment orfacilities currently occupied by the Company, and to Caliper’s Knowledge, noreal properties, assets, equipment or facilities previously owned or leased bythe Company or any of its predecessors are, and the Company and itspredecessors have not transported or arranged for transportation (directly orindirectly) of any Hazardous Materials to any location that, is listed orproposed for listing under the Comprehensive Environmental Response, Compensationand Liability Act of 1980, as amended, 42 U.S.C. §§ 9601, et seq., or on anysimilar state list, or the subject of federal, state or local enforcementactions or investigations or Remedial Action.

 

(H)          To Caliper’s Knowledge, no action or failure to actby the Company or any of its predecessors has occurred, and no event hasoccurred with respect to the Company or any of its predecessors or theiroperations that has resulted in exposure of the Company’s or any of itspredecessors’ employees or any third parties to any amount of any HazardousMaterial that may now or in the future constitute a threat to human health orthe environment or subject the Company to Liability.

 

(c)      Environmental Permits.

 

(i)                                     The Companycurrently holds, and has for the five (5) years prior to the date hereofheld, all Environmental Permits that are material for the conduct of itsactivities and businesses (including, for the avoidance of doubt, those whichrelate to the generation, transportation, manufacture, disposal of, or sale ofany product containing, a Hazardous Material) as such activities and businessesare currently being conducted, were conducted in the past, and are currentlycontemplated to be conducted.

 

(ii)                                  The Company iscurrently in compliance in all material respects with and has for the five (5) yearsprior to the date hereof complied in all material respects with, and has notreceived any written or oral notice or other communication asserting oralleging a violation with respect to, all Environmental Permits, and there areno facts or circumstances reasonably likely to result in the revocation,suspension or revision of any Environmental Permits.

 

(iii)                               There are noEnvironmental Permits that are required to be transferred or reissued, or thatare otherwise prohibited from being transferred or reissued, as a result of thetransactions contemplated by this Agreement.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(d)      Reports and Records.

 

(i)                                     Caliper hasdisclosed and delivered to Taconic all material information, including withoutlimitation all studies, analyses, audits, assessments, reports, data and testresults, in its possession, custody or control relating to (i) theenvironmental conditions of the Company at, on, in, under or about the realproperties, assets, equipment or facilities currently owned, leased, occupied,operated, controlled, or used by the Company or any of its predecessors, and (ii) HazardousMaterials used, managed, handled, transported, treated, generated, stored orReleased by the Company or any of its predecessors at any time in connectionwith the business of the Company or any of the real properties, assets,equipment or facilities currently or formerly owned, leased, occupied,operated, controlled, or used by the Company or any of its predecessors.

 

(ii)                                  Except as setforth in Section 2.22(d) of the Disclosure Schedule, there are noEnvironmental Laws or Environmental Orders applicable to the Company or to thereal properties, assets, equipment or facilities or businesses of the Companythat would require the Company, Taconic or any other person to provide noticeto, to take actions to satisfy, or to obtain the approval of, any GovernmentalEntity as a condition to the consummation of the transactions contemplated bythis Agreement.  The Company has compliedin all material respects with all disclosure obligations imposed byEnvironmental Laws with respect to the transactions contemplated by thisAgreement.

 

2.23        Fees and Expenses.   The Companyhas not incurred, nor will the Company incur, directly or indirectly, anyLiability for investment banking fees or for brokerage or finders’ fees oragents’ commissions or any similar charges in connection with this Agreement orany transaction contemplated hereby.

 

2.24        Employee Benefit Plans and Compensation.

 

(a)      Section 2.24(a)(i) of theDisclosure Schedule contains an accurate and complete list of each CompanyEmployee Plan, of the Company (or of Caliper if and to the extent it covers anyCompany Personnel) , and each agreement or employment arrangement that relatesto the employment of any employee of the Company who is not at-will employee(an “Employee Agreement”).  Since January 1,2009, neither the Company nor any of its ERISA Affiliates has made any plan orcommitment to establish, adopt or enter into any new Company Employee Plan orEmployee Agreement or to modify any Company Employee Plan or EmployeeAgreement, except (i) to the extent required by Law and (ii) inconnection with renewal of Company Employee Plans for 2010 in Caliper’s OrdinaryCourse of Business.  Section 2.24(a)(ii) ofthe Disclosure Schedule sets forth a table listing the name and salary of eachemployee and/or consultant of the Company.

 

(b)      Documents. Caliper hasdelivered to Taconic, or will make available immediately upon request,(i) correct and complete copies of all documents embodying each 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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Company Employee Plan and each Employee Agreement,including all amendments, summary plan descriptions, and trust documents, (ii) thethree (3) most recent annual reports (Form Series 5500 and allschedules and financial statements attached thereto), if any, required underERISA for any Company Employee Plan, (iii) if any Company Employee Plan isfunded, the most recent annual and periodic accounting of such Company EmployeePlan’s assets, (iv) all material written agreements and contracts relatingto each Company Employee Plan, including administrative service agreements andgroup insurance contracts, (v) all material communications relating to anyestablished or proposed Company Employee Plan that relates to any materialamendments, terminations, increases or decreases in benefits, acceleration ofpayments or vesting schedules or other events that would result in anyLiability to the Company or ERISA Affiliates, (vi) all materialcorrespondence to or from any Governmental Entity relating to any CompanyEmployee Plan, (vii) all policies pertaining to fiduciary liabilityinsurance covering the fiduciaries for each Company Employee Plan, (viii) discriminationtest results for each Company Employee Plan for the three (3) most recentplan years, (ix) the most recent IRS determination letter issued withrespect to each Company Employee Plan, and (x) visa and work permitinformation with respect to current Company Personnel. There is no CompanyEmployee Plan that is maintained in any non-U.S. jurisdiction.

 

(c)      Employee Plan Compliance. Each CompanyEmployee Plan has been established and maintained in accordance with its termsand in substantial compliance with all applicable Laws.  The Company and each of its ERISA Affiliateshas performed all material obligations required to be performed by them undereach Company Employee Plan.  Each CompanyEmployee Plan intended to be qualified under Section 401(a) of theCode has timely obtained a favorable determination letter from the IRS (or isentitled to rely on an opinion letter issued by the Internal Revenue Service tothe prototype sponsor of the Plan), and nothing has occurred since the date ofthat determination letter that could reasonably be expected to cause any suchCompany Employee Plan to fail to qualify under Section 401(a) of theCode.  No “prohibited transaction,”within the meaning of Section 4975 of the Code or Sections 406 and407 of ERISA, and not otherwise exempt under Section 408 of ERISA or Section 4975of the Code, has occurred with respect to any Company Employee Plan.  There are no material actions, suits orclaims pending or, to the Knowledge of Caliper, threatened or reasonablyanticipated (other than routine claims for benefits) against any CompanyEmployee Plan or against the assets of any Company Employee Plan.  Each Company Employee Plan can be amended,terminated or otherwise discontinued in accordance with its terms, withoutLiability to Taconic, the Company or any ERISA Affiliate (other than ordinaryadministration expenses).  There are noaudits, inquiries or proceedings pending or to the Knowledge of Caliper or anyof its Subsidiaries or ERISA Affiliates, threatened by the IRS, U.S. Departmentof Labor or any other Governmental Entity with respect to any Company EmployeePlan.  The Company and its ERISAAffiliates are not subject to any penalty or tax with respect to any CompanyEmployee Plan under Section 502(i) of ERISA or Sections 4975through 4980 of the Code, nor is any employee or former employee of the Companysubject to tax under Section 409A of the Code.  The Company and each of its ERISA Affiliateshas timely made all contributions and other payments required by and due underthe terms of each Company Employee Plan.

 

(d)      No Pension Plans or WelfarePlans. The Company and its ERISA Affiliates have not ever maintained,established, sponsored, participated in, or contributed to, any(i) employee benefit plan subject to Section 412 of the Code or TitleIV of ERISA, 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(ii) “multiemployer plan” within the meaning ofSection (3)(37) of ERISA, (iii) “multiple employer plan” for purposesof ERISA, or (iv) “funded welfare plan” within the meaning of Section 419of the Code.  No Company Employee Planprovides health or disability benefits that are not fully insured through aninsurance contract, except as set forth in Section 2.24(d) of theDisclosure Schedule.

 

(e)      No Post-EmploymentObligations. No Company Employee Plan provides, or reflects orrepresents any Liability to provide, post-termination or retiree lifeinsurance, health or other retiree employee welfare benefits to any person forany reason, except as may be required by COBRA or other applicable statute, andneither the Company nor any of its ERISA Affiliates has ever represented,promised or contracted (whether in oral or written form) to any CompanyPersonnel (either individually or to Company Personnel as a group) or any otherperson that such Company Personnel or other person would be provided withpost-termination or retiree life insurance, health or other employee welfarebenefit, except to the extent required by statute.

 

(f)      COBRA; FMLA; HIPAA. The Company andeach of its ERISA Affiliates has, prior to the date hereof, substantiallycomplied with the health care continuation requirements of COBRA, FamilyMedical Leave Act of 1993, HIPAA, the Women’s Health and Cancer Rights Act of1998, the Newborns’ and Mothers’ Health Protection Act of 1996 and any similarprovisions of state or foreign Law applicable to Company Personnel.  Neither the Company nor any of its ERISAAffiliates has any material unsatisfied obligations to any Company Personnel orqualified beneficiaries pursuant to COBRA, HIPAA or any state or foreign Lawgoverning health care coverage or extension.

 

(g)      Effect of Transaction. Except as setforth in Section 2.24(g) of the Disclosure Schedule, the execution ofthis Agreement and the consummation of the transactions contemplated herebywill not (either alone or upon the occurrence of any additional or subsequentevents) constitute an event under any Company Employee Plan, EmployeeAgreement, trust or loan that will or may result in (i) any payment (whetherof severance pay or otherwise), acceleration, forgiveness of Indebtedness,vesting, distribution, increase in benefits or obligation to fund benefits, (ii) thepayment of any amount that may be deemed a “parachute payment” underSection 280G of the Code with respect to any Company Personnel (a “Section 280GPayment”) or (iii) a tax under Section 409A of the Code withrespect to any Company Personnel.  Thereis no contract, agreement, plan or arrangement to which the Company or any ofits ERISA Affiliates is a party or by which any of them is bound to compensateany Company Personnel for excise taxes paid pursuant to Section 4999 ofthe Code.

 

(h)      Employment Matters. The Companyand each of its ERISA Affiliates: (i) has complied in all material respectswith all applicable foreign, federal, state and local Laws, collectiveagreements, works agreements, rules and practices respecting employment,employment practices, terms and conditions of employment and wages and hoursincluding, without limitation, orders and awards relevant to terms andconditions of service, health and safety, labor leasing, use of fixed-termcontracts, supply of temporary staff, social security filings and payments,secondment and expiration rules, applicable requirements in respect of staffrepresentation and paid vacations, in each case, with respect to CompanyPersonnel, (ii) is not liable for any arrears of wages, taxes or penalties forfailure to comply with any of the foregoing, and (iii) is not liable forany payment to any trust or other fund governed by or 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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maintained by or on behalf of any GovernmentalEntity, with respect to unemployment compensation benefits, social security orother benefits or obligations for Company Personnel (other than routinepayments to be made in the normal course of business and consistent with pastpractice), except for any such Liability that would not, individually or in theaggregate, be material to the Company. Except as set forth in Section 2.24(h) of the DisclosureSchedule, there are no pending or, to the Knowledge of Caliper, threatened orreasonably anticipated claims or actions against the Company or any of itsERISA Affiliates under any worker’s compensation policy or long-term disabilitypolicy.  Neither the Company nor any ofits ERISA Affiliates has or reasonably anticipates any direct or indirectmaterial Liability of the Company with respect to any misclassification of anyperson as an independent contractor rather than as an employee, or with respectto any employee leased from another employer.

 

(i)       Labor. No work stoppage orlabor strike against the Company is pending or, to the Knowledge of Caliper,threatened or reasonably anticipated. Caliper does not know of any activities or proceedings of any laborunion to organize any Company Personnel. There are no actions, suits, claims, labor disputes or grievancespending or, to the Knowledge of Caliper, threatened or reasonably anticipatedrelating to any labor, safety or discrimination matters involving any CompanyPersonnel, including charges of unfair labor practices or discriminationcomplaints.  The Company has not engagedin any unfair labor practices within the meaning of the National LaborRelations Act or other applicable similar Laws. The Company presently is not, nor has it been in the past, a party to,or bound by, any collective bargaining agreement or union contract with respectto Company Personnel, and no collective bargaining agreement is beingnegotiated by the Company.  The Companyis not, and has not been, a party to any redundancy agreements (includingsocial plans or job protection plans). The employment of all Employees is “at will” employment.

 

(j)       No Interference or Conflict. To theKnowledge of Caliper, no Company Personnel is obligated under any contract oragreement or subject to any judgment, decree or order of any court oradministrative agency that would interfere with such person’s efforts topromote the interests of the Company, or that would, in the case of anyEmployee or officer, interfere with the Company’s businesses as presentlyconducted, or that would, in the case of any director, interfere in thedischarge of such director’s fiduciary duties. Neither the execution nor delivery of this Agreement, nor the carryingon of the Company’s businesses as presently conducted, nor any activity of suchCompany Personnel in connection with the carrying on of the Company’sbusinesses as presently conducted, will, to the Knowledge of Caliper, conflictwith or result in a breach of the terms, conditions or provisions of, orconstitute a default under, any contract or agreement under which any of suchCompany Personnel is now bound.

 

(k)      Certain CompensationArrangements. Except as set forth in Section 2.24(k) ofthe Disclosure Schedule, (i) there are no variable compensation plans orpractices (including bonus plans or practices) with respect to CompanyPersonnel, and (ii) the Company has not made any promises or otherundertakings, oral or in writing, to any Company Personnel or any third partywith respect to any such variable compensation plans or practices. The Companyhas paid in full all wages, salary, severance payments, termination payments,bonuses or other compensation payable to any Company Personnel, except to theextent accrued in full on the Current Balance Sheet with respect to currentEmployees of the Company in compliance with Law.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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2.25        Insurance and Bonds.  Section 2.25 of the DisclosureSchedule lists all insurance policies and bonds (whether denominated as bid,litigation, performance, fidelity, AD&D, or otherwise) covering the assets,business, equipment, properties, operations, employees, officers and directors(in their respective capacities as such) of the Company.  Caliper believes that such insurance policiesand bonds are upon terms that are reasonable and adequate for and are of thetype and in amounts customarily carried by persons with businesses, operations,properties and locales similar to those of Company.  There is no claim by the Company pendingunder any of such policies or bonds.  Allpotentially insurable claims have been properly tendered to the appropriateinsurance carrier in compliance with any applicable insurance policy notice provisions.  All premiums due and payable under all suchpolicies and bonds have been paid, and the Company and its Affiliates areotherwise in material compliance with the terms of such policies and bonds (orother policies and bonds providing substantially similar insurancecoverage).  All such insurance policiesare valid and binding in accordance with their terms, except to the extent suchenforceability may be limited by the effect of any applicable bankruptcy, reorganization,insolvency, moratorium or similar Law affecting creditors’ rights generally andgeneral principles of equity or public policy (regardless of whether suchenforceability is considered in a proceeding in equity or at law), and are infull force and effect.  To the Knowledgeof Caliper, there is no threat of termination of, or premium increase withrespect to, any of such policies.  Thebonds listed in such Schedule 2.25 of the Disclosure Schedulesatisfy all material requirements for such bonds set forth in (i) any Lawapplicable to the Company or its businesses and (ii) any Contract of theCompany.

 

2.26        Compliance with Laws.  The Company has complied in all materialrespects with, is not in material violation of, and has not received anynotices of violation with respect to, foreign, federal, state or localLaws.  Each of the Company Products andServices does and has complied in all material respects with all applicableLaws of each jurisdiction in which such Company Product is or has been solddirectly or indirectly by or on behalf of the Company, including, withoutlimitation, such Laws which pertain to: electrical safety; energy consumptionof energy using products or components; the presence (or absence) of specifiedsubstances in electrical or electronic products, batteries or productsgenerally; registration or notification of chemical substances in products;labeling of product or product packaging as respects product content or asrespects health, safety or environmental effects or attributes or as respectsrequired end-of-life handling or disposition of products or product packaging;and coverage under approved scheme for end-of-life collection and return ofproducts or of product packaging.

 

2.27        Animal Welfare.  The Company is in material compliance withand has not materially violated the terms and provisions of applicable Lawsrelating to animal care, control and testing, including, but not limited to,animal cruelty laws and the Guide for the Care and Use of Laboratory Animals ofthe U.S. Public Health Service, and all regulations promulgated under any ofthe foregoing.  The Company has not beenthe subject of any investigation relating to its compliance with or  violation of any of the foregoing laws orregulations.

 

2.28        Council on Accreditation of the Association for Assessmentand Accreditation of Laboratory Animal Care Certification.  Except as set forth Schedule 2.28of the Disclosure Schedule, the Company has been granted full accreditation byall applicable Federal, state and local accreditation bodies, and the Companyhas not been the subject of any inspection, investigation or decision affectingits accreditation status within the last two (2) years.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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2.29        Foreign Corrupt Practices Act.  The Company (including any of its officers ordirectors) has not taken or failed to take any action which would cause it tobe in violation of the Foreign Corrupt Practices Act of 1977, as amended, orany rules or regulations thereunder. Neither the Company nor, to the Knowledge of Caliper, any third partyacting on behalf of the Company, has offered, paid, promised to pay, orauthorized, or will offer, pay, promise to pay, or authorize, directly orindirectly, the giving of money or anything of value to any Official, or to anyother person while knowing or being aware of a high probability that all or aportion of such money or thing of value will be offered, given or promised,directly or indirectly, to any Official, for the purpose of: (i) influencingany act or decision of such Official in his, her or its official capacity,including a decision to fail to perform his, her or its official duties orfunctions or (ii) inducing such Official to use his, her or its influencewith any Governmental Entity to affect or influence any act or decision of suchGovernmental Entity, or to obtain an improper advantage in order to assist theCompany or any third party in obtaining or retaining business for or with, ordirecting business to, the Company.  Forpurposes of this Agreement, an “Official” shall include any appointed orelected official, any government employee, any political party, party official,or candidate for political office, or any officer, director or employee of anyGovernmental Entity.

 

2.30        Health Profiles.  Caliper has provided to Taconic a completeset of all current and historical data related to the health of the animalsthat have been sold by the Company or are currently in the Company’s facilitiesand a complete set of all historical data related to any and all testsperformed or authorized by the Company to detect disease-causing organisms atthe Company’s facilities (together, the “Health Data”).  No event or circumstance has occurred sincethe date of Taconic’s inspection of the Company’s facilities and evaluation ofthe Company’s Health Data that materially affects such Health Data, would causethe health standard for animals sold commercially to deviate from the “TaconicRestricted Flora” standard or would cause an organism to be detected by theInternational Health Monitoring System test specified by Taconic, namely theIHMS-52 test.  Restricted Flora excludedorganisms that are accepted as being present in the Company’s mice includeStaphyloccus aureus, Klebsiella oxytoca and Pneumocystis carinii.

 

2.31        Warranties.  The Company has provided to Taconic a trueand correct copy of all warranties given by the Company with respect to theProducts and Services.  There are nopending warranty claims against the Company that are material in amount or outof the Ordinary Course of Business.

 

2.32        Complete Copies of Materials.  Caliper has delivered or made available toTaconic true and complete copies of each document that has been requested inwriting by Taconic or its counsel or advisors (unless inapplicable) or that isreferenced in the Disclosure Schedule or any schedule to this Agreement.

 

2.33        Insider Loans.  There are no outstanding loans of any moneyfrom the Company to any of the Company Personnel or to another Caliper Company,and none of such persons is indebted to the Company for any amount.

 

2.34        Suppliers and Customers.  No licensor, vendor, supplier, licensee orcustomer of the Company within the last year has cancelled or otherwisemodified in any material adverse respect its relationship with the Company, andno such Person has communicated (orally or in writing) to the officers,directors or other senior managers of the Company any intention to terminate ormaterially amend its Contract with the Company, and (ii) to the Knowledgeof 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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Caliper,the consummation of the transactions contemplated hereby will not adverselyaffect any of such relationships.

 

2.35        Privacy.  Caliper has delivered to Taconic correct andcomplete copies of all written policies maintained by the Company since theAcquisition Date with respect to privacy and personal data protection relatingto its respective employees, customers, suppliers, service providers or anyother third parties from or about whom the Company has obtained personal data (“CompanyPrivacy Policies”).  The Company hascomplied in all material respects with, is not in material violation of, andhas not received any notices of violation with respect to, any applicable Laws,contracts, Company Privacy Policies or any other commitments, obligations orrepresentations, concerning privacy and personal data protection relating totheir employees, customers, suppliers, service providers or any other thirdparties from or about whom the Company has obtained personal data (“CompanyPrivacy Obligations”).  The Companyhas full right and authority to transfer to Taconic all personal data in thepossession of the Company.  Theconsummation of the transactions contemplated by this Agreement will notviolate any Company Privacy Obligation, nor require the Company to provide anynotice to, or seek any consent from, any employee, customer, supplier, serviceprovider or other third party under any Company Privacy Policy.  To the Knowledge of Caliper, no Company PrivacyObligations will impose any restrictions upon Taconic’s ability to use,possess, disclose or transfer such personal data in the manner the Company hasused, possessed, disclosed or transferred such or similar personal data priorto the Closing.  The Company does not haveany notice of any claims or alleged claims that the Company has violatedCompany Privacy Obligations and no governmental agency is investigating todetermine whether the Company has violated any Company PrivacyObligations.  The consummation of thetransactions contemplated by this Agreement will not violate any CompanyPrivacy Obligation, nor require the Company to provide any notice to, or seekany consent from, any employee, customer, supplier, service provider or otherthird party under any Company Privacy Policy.

 

2.36        Compliance with the Immigration Reform and ControlAct.  The Company is in materialcompliance with and have not violated in any material respect the terms andprovisions of applicable Laws relating to immigration, including theImmigration Reform and Control Act of 1986, and all related regulationspromulgated thereunder (collectively, the “Immigration Laws”).  Except as set forth as in Section 2.36of the Disclosure Schedule, the Company has not been the subject of anyinspection or investigation relating to its compliance with or violation of theImmigration Laws.  With respect to anyemployee of the Company for whom compliance with the Immigration Laws isrequired, the Company will deliver to Taconic, promptly after the date of thisAgreement upon written request copies of such employee’s Form I-9(Employment Eligibility Verification Form) and copies of all other records,documents or other papers which are retained with the Form I-9 by theCompany pursuant to the Immigration Laws.

 

2.37        Data Room.  The Company has made available to Taconic inthe online data room established with BroadOak Partners, LLC for “Project Swiss”in connection with the Transaction (the “Data Room”) copies of alldocuments disclosed in connection with the Transactions, and such copies aretrue and complete copies of the respective documents.  Without limiting or expanding the foregoing, “trueand complete copies of the respective documents” includes all written and oralcommunications or other acts that modify or supplement the obligations setforth in the documents contained in the Data Room. Caliper has delivered toTaconic an electronic 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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copyof the Data Room, which Caliper represents and warrants was not changed in the48 hours prior to the execution of this Agreement.

 

2.38        Representations Complete.  None of the representations or warrantiesmade by Caliper or the Company (as modified by the Disclosure Schedule) in thisAgreement, and none of the statements made in any exhibit, schedule orcertificate furnished by the Company or anyone acting on behalf thereofpursuant to this Agreement contains, or will contain at the date hereof, anyuntrue statement of a material fact, or omits or will omit at the date hereofto state any material fact necessary in order to make the statements containedherein or therein, in the light of the circumstances under which made, notmisleading.

 

ARTICLE 3

 

REPRESENTATIONS ANDWARRANTIES OF TACONIC

 

Asof the date hereof Taconic hereby represents and warrants to Caliper:

 

3.1          Organization and Standing.

 

(a)           Taconic is a corporation duly organized, validlyexisting and in good standing under the laws of the State of New York.  Taconic has the corporate power to own itsproperties and to carry on its business as currently being conducted.

 

(b)           Taconic has all requisite corporate power andauthority to enter into this Agreement and to consummate the transactionscontemplated hereby.  The execution anddelivery of this Agreement and the consummation of the transactionscontemplated hereby have been duly authorized by all necessary corporate actionon the part of Taconic, and no further action is required on the part ofTaconic to authorize this Agreement and the transactions contemplated hereby.  This Agreement has been duly executed anddelivered by Taconic and constitutes the valid and binding obligations ofTaconic, enforceable against Taconic in accordance with its terms, except assuch enforceability may be subject to the Laws of general application relating tobankruptcy, insolvency and the relief of debtors and rules of Lawgoverning specific performance, injunctive relief or other equitable remedies.

 

(c)           The Board of Directors of Taconic has duly approvedthis Agreement and the transactions contemplated by this Agreement.

 

3.2          No Conflict.  The execution and delivery of this Agreementby Taconic does not, and the consummation of the transactions contemplatedhereby will not, conflict with, or result in any violation of, or default under(with or without notice or lapse of time, or both), or give rise to a Conflictunder (i) any provision of the certificate of incorporation and bylaws ofTaconic; (ii) any Contract to which Taconic or any of its Affiliates, orany of their respective properties or assets (whether tangible or intangible)is a party or, as the case may be, subject; or (iii) any Law applicable toTaconic or its properties or assets (whether tangible or intangible), except ineach case where such Conflict will not have a Taconic Material Adverse Effector will not have an affect on the legality, validity or enforceability of thisAgreement.

 

3.3          Consents.  No consent, waiver, approval, order orauthorization of, or registration, declaration or filing with, any GovernmentalEntity is required by or with respect to Taconic in connection with theexecution and delivery of this Agreement or the consummation of thetransactions contemplated hereby that has not been obtained.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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ARTICLE 4

 

AGREEMENTS

 

4.1           Confidentiality.

 

(a)      Each of the parties heretohereby agrees that this Agreement, the exhibits and schedules hereto, and anyinformation obtained in any due diligence investigation, or pursuant to thenegotiation and execution of this Agreement or the effectuation of thetransactions contemplated hereby, shall be governed by the terms of theConfidentiality Agreement dated July 22, 2009 (the “ConfidentialDisclosure Agreement”) between Caliper and Taconic (or representatives ontheir behalf).  The Confidential Disclosure Agreement shall be deemed to  apply to the Information (as defined in theConfidential Disclosure Agreement) of each of Taconic, Caliper and the Company;that is, Caliper agrees to keep confidential, except as otherwise legallyrequired, all Information of the Company and Taconic (as if it were the Companyand Taconic were the disclosing parties and Caliper were the receiving party),and Taconic agrees to keep confidential all Information of Caliper (not includingthe Company), except as otherwise legally required.  Caliper further agrees that it will furnishto Taconic all financial, technical and operating data and other informationrelating specifically to the Company or its business not already in Taconic’spossession as Taconic shall request.

 

(b)      The parties hereto herebyacknowledge that offers of employment made by Taconic to certain CompanyPersonnel pursuant to Section 4.6 shall not violate the terms ofthe Confidential Disclosure Agreement.

 

(c)      Notwithstanding theforegoing, Taconic acknowledges that Caliper intends to file a redacted versionof this Agreement with the Securities and Exchange Commission pursuant to aconfidential treatment request.  Caliperwill give Taconic a reasonable opportunity to review and comment on anyconfidential treatment request proposed to be submitted by Caliper to theSecurities and Exchange Commission, and Caliper will incorporate any reasonablerequests by Taconic with respect thereto.

 

4.2           Expenses.  All fees and expenses, including all legal,accounting, investment banking, financial advisory, consulting and all otherfees and expenses of third parties (“Third-Party Expenses”), incurred bya party in connection with the negotiation and effectuation of the terms andconditions of this Agreement and the transactions contemplated hereby, shall bethe obligation of the respective party incurring such fees and expenses; *provided, however,* that any Third-PartyExpenses incurred by the Company are hereby assumed by Caliper and shall be thesole responsibility of Caliper.

 

4.3           Public Disclosure.  Caliper and Taconic shall each issue a pressrelease with language previously agreed to announcing the transactionscontemplated herein.

 

4.4           Reasonable Best Efforts.  Subject to the terms and conditions providedin this Agreement and to the extent not previously taken, each of the partieshereto shall use commercially reasonable best efforts to take promptly, orcause to be taken, all actions, and to do promptly, or cause to be done, allthings necessary, proper or advisable under applicable Laws to consummate andmake effective the transactions contemplated hereby, to obtain all necessary 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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waivers,consents and approvals and to effect all necessary registrations and filingsand to remove any injunctions or other impediments or delays, legal orotherwise, in order to consummate and make effective the transactionscontemplated by this Agreement for the purpose of securing to the parties heretothe benefits contemplated by this Agreement.

 

4.5           Additional Documents and Further Assurances.  Each party hereto, at the request of anotherparty hereto, shall execute and deliver such other instruments and do andperform such other acts and things as may be necessary or desirable foreffecting completely the consummation of the Transaction and the transactionscontemplated hereby.  In addition, afterthe Closing, Caliper agrees to furnish or give access to, as appropriate,Taconic such records and information of Caliper and its Subsidiaries thatrelate to the Company as Taconic shall reasonably request for the purpose ofcomplying with Law or as necessary to administer the business of the Company,including without limitation, human resources, sales and customer relations andthe like.

 

4.6           Employment Arrangements.  Each employee of the Companywho has executed and delivered prior to the Closing, or who executes anddelivers within any deadline following the Closing specified by Taconic, his orher acceptance of either an offer of employment or a notice of continuedemployment and becomes an employee of Taconic or a Subsidiary of Taconic or whoremains an employee of the Company shall be referred to herein as a “ContinuingEmployee.” Taconic shall make such offers of employment or provide noticesof continuing employment to each current employee of the Company, whichemployees are listed on Section 2.24(a)(ii) of the DisclosureSchedule.  Continuing Employees shallreceive credit for their continuing service with the Company in determining therate at which they accrue service under the Taconic benefit plans in which theyparticipate, except with respect to the Taconic 401(k) & ProfitSharing Plan for which credited service will begin on the Continuing Employee’shire date as a Taconic employee.  Setforth on Schedule 4.6 of the Disclosure Schedule is a list of accrualsmade by Caliper with respect to Continuing Employees who are participants inCaliper’s bonus plan; the full dollar amount of such accruals, without regardto vesting or other restrictions, is also included in the calculation of NetWorking Capital. Taconic agrees to pay such accrued bonuses to the ContinuingEmployees prior to March 31, 2010 provided that such employeesremain employed by Taconic or one of its Subsidiaries on the payout date andotherwise fulfill the requirements under such plan. Caliper agrees to supplyTaconic with any information reasonably requested by Taconic with respect torequired compensation and benefit reporting to Governmental Authorities for theperiod prior to the Closing Date, and both Taconic and Caliper shall providethe other with any information necessary for the parties to comply with this Section 4.6.

 

4.7           Non-Continuing Employees.  Caliper shall be solely responsible for allemployment and benefit obligations, including COBRA notices, for all CompanyPersonnel who are not or do not become Continuing Employees.

 

4.8           Employment of Continuing Employees.  Notwithstanding anything else herein to thecontrary, Caliper  hereby acknowledgesand agrees that following Closing, Taconic shall have complete and absoluteauthority to cause the Company to terminate the employment of any ContinuingEmployee for any reason.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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4.9           Internet Inquiries.  Caliper shall take all necessary action toensure that all internet inquiries regarding the Company and/or CompanyProducts and Services are appropriately re-directed as specified by Taconicfrom time to time.

 

4.10         Xenogen Trademark.  Subject to Taconic’s continuing rights to usethe “Xenogen” trademark as set forth in Section 7.2 of the ImagingServices License Agreement referred to in Section 5.2(e), Caliperhereby agrees that Taconic and its Subsidiaries may, until one hundred eighty(180) days after the Closing, use, without payment or restriction: (i) the“Xenogen” name and related trademarks, except that such use shall be limited touse as part of the trade name, “Xenogen Biosciences” and (ii) allmarketing and sales material related to the business of the Company, includingall pictures, graphics and other information on Caliper’s website relatingsolely to the Company Products and Services,, and all derivative works of anyof the foregoing.  Promptly following theClosing, Taconic will remove the word, “Xenogen,” from the Company’s corporatename.

 

4.11         Destruction of Confidential Information.  No later than five (5) Business Daysafter the Closing, Caliper shall distribute a written notice, in form andsubstance acceptable to Taconic, to all third parties who received confidentialinformation relating to the Company in connection with discussions about anypotential acquisition activity to: (i) promptly return to the Company, ordestroy all copies of, written confidential information relating to the Company(including any confidential information stored on a computer, word processor orsimilar device) furnished to such third parties by Caliper or on behalf of theCompany in their possession or custody or in the possession or custody of theirrespective representatives, officers, directors, and employees; and(ii) confirm in writing (copies of which shall be delivered to Taconic)that all such confidential information has been either returned or destroyed.

 

4.12         Tax Matters.

 

(a)           Transfer Taxes.  All transfer, documentary, sales, use, stamp,registration and other such Taxes and all conveyance fees, recording chargesand other fees and charges (including any penalties and interest) incurred inconnection with consummation of the transactions contemplated by thisAgreement, including without limitation any applicable New Jersey ControllingInterest Transfer Tax, shall be paid by Caliper.  Caliper shall accurately and timely file allnecessary Tax Returns and other documentation with respect to all such Taxes,fees and charges, and if required by applicable Law, Taconic will, and willcause its Affiliates to, join in the execution of any such Tax Returns andother documentation.

 

(b)           Tax Returns.  Except as provided in Section 4.12(a),Caliper shall accurately prepare and timely file (or cause to be so preparedand filed) all Tax Returns and other documentation of or with respect to theCompany for Pre-Closing Tax Periods, and Taconic shall accurately prepare andtimely file (or cause to be so prepared and filed) all other Tax Returns andother documentation of or with respect to the Company (each such Tax Returnthat relates to Pre-Closing Taxes, a “Pre-Closing Tax Return”).  All Pre-Closing Tax Returns shall be preparedin a manner consistent with prior practice unless otherwise required byapplicable Law.  Upon Caliper’s request,Taconic shall provide each Pre-Closing Tax Return that it prepares to Caliperat least fifteen (15) days prior to filing such Pre-Closing Tax Return for itsreview and comment.  All Pre-ClosingTaxes relating to each Pre-Closing Tax Return (whether or not shown on suchPre-Closing Tax Return) shall be the responsibility of, and a liability,subject to indemnification pursuant to Article 6, of Caliper,except that Taconic shall be responsible for and pay such Taxes 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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tothe extent that liability for such Taxes entered into the computation of thePost-Closing Adjustment Payment pursuant to Section 1.6.  Taconic shall be responsible for and pay allTaxes of the Company other than Pre-Closing Taxes, *provided*, *however*,(i) that Taconic may apply without reimbursement any and all Taxattributes to offset or reduce the amount of any such Taxes including withoutlimitation, estimated taxes, net operating losses, prepaid amounts, and Taxcredits, whether accruing before or after the Closing Date and (ii) Taconicshall not be responsible for any Taxes for which it has a claim forindemnification from Caliper under Article 6 of this Agreement.

 

(c)           Cooperation.  From and after the Closing Date, Taconic andCaliper shall reasonably cooperate, and will cause their Affiliates toreasonably cooperate, with one another in preparing and filing all Tax Returnsto the extent such filings require providing necessary information, records anddocuments relating to the Company, and, if required by applicable law,executing any Pre-Closing Tax Returns. Taconic and Caliper shall cooperate with one another to the same extentin defending or resolving any audit, examination or litigation relating to suchTaxes.

 

(d)           Audits.  Calipershall not settle any such Tax audit in a manner that would adversely affect theCompany after the Closing Date without the prior written consent of Taconic,which consent shall not be unreasonably withheld.

 

(e)           Carrybacks.  Taconic shall timely make all available Taxelections and timely take any other available actions necessary to forgo thecarryback of Tax attributes of the Company from Tax periods ending after the ClosingDate to Tax Returns of a consolidated, combined, affiliated, or unitary groupfor any Pre-Closing Tax Period.

 

(f)            Consolidated Return Matters.  Caliper shall not elect to retain any netoperating loss carryovers or capital loss carryovers of the Company.  If any Share would be a “loss share” withinthe meaning of Treasury Regulation Section 1.1502-36(f)(7), determinedwithout regard to any election under Treasury Regulation Section 1.1502-36(d)(6),then Caliper shall make a timely election under Treasury Regulation Section 1.1502-36(d)(6)(i)(A) toreduce the basis in each such Share in an amount sufficient to avoid attributereduction with respect to each such Share and the Company.  Caliper shall not make any election pursuantto Treasury Regulation Section 1.1502-36(d)(6)(i)(B) or -36(d)(6)(i)(C) (relatingto reattribution of tax attributes) or Treasury Regulation Section 1.1502-96(d)(5) (relatingto reattribution of limitations under Section 382 of the Code).

 

(g)           Prior Ownership Change.  As soon as reasonably practicable after thecompletion of the Code Section 382 analysis described in Section 4.12(h) ofthis Agreement, Caliper, the Company, and Taconic shall execute an agreement insubstantially the form attached hereto as Exhibit B (the “Section 382Allocation Agreement”), which agreement shall provide for an apportionmentunder Treasury Regulation Section 1.1502-95 by Caliper to the Company ofcertain consolidated Code Section 382 limitations and net unrealizedbuilt-in gains (or the Code Section 382 limitations and built-in gains ofsuch subgroup as may be applicable). Caliper shall elect to apportion to the Company a pro rata amount of theCode Section 382 limitations and net unrealized built-in gains based onthe relative value of the Company to the loss group at the time of each priorownership change.

 

(h)           Section 382 Analysis.  Caliper shall engage an outside auditing firmthat is mutually acceptable to Caliper and Taconic to perform an analysis ofthe Company’s stock 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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ownershiphistory through the Closing Date in order to determine whether one or more “ownershipchanges” as defined in Section 382 of the Code have occurred with respectto the Company’s losses, built-in losses, or other Tax attributes.  In the event one or more “ownership changes”have occurred, the analysis will also include an assessment of the Code Section 382or other limitations applicable to the Company’s net operating losses, built-inlosses, and other Tax attributes.  Caliperand Taconic shall split equally the cost of such analysis, which will be bidout to at least two accounting firms, and Caliper shall use reasonable bestefforts to have such analysis completed by March 31, 2010, but in no eventlater than June 30, 2010.

 

4.13         Tax Sharing Agreements.  All Tax sharing agreements or similaragreements (including without limitation any obligation to make taxdistributions) with respect to or involving the Company shall be terminated asof the Closing Date and, after the Closing Date, no such person shall be boundthereby or have any liability thereunder.

 

4.14         Non-Solicitation.  For a period of one year after the Closing, (i) Caliperwill not, and will cause its officers and other employees not to, solicit, encourage, or request any Continuing Employee to terminate suchperson’s employment by or consultancy to the Company or Taconic, and (ii) Taconic willnot, and will cause its officers and other employees not to, solicit, encourage, or request any employee of Caliper to terminate suchperson’s employment by or consultancy to Caliper.

 

4.15         CaliperConfidential Information Remaining with the Company.  Taconic acknowledges that, becausethe Company has been operated as a subsidiary of Caliper for a substantialperiod of time, there is confidential information regarding Caliper’sbusinesses other than the business of the Company located at the Company’s sitein Cranbury, New Jersey, including without limitation, on the e-mail server andother computers located at such site.  Taconicagrees with respect to such confidential information that (i) suchinformation shall be and remain subject to the terms of the ConfidentialDisclosure Agreement, (ii) Taconic shall not actively search suchinformation for any information that is not related to the business of theCompany and (iii) Taconic shall take reasonable measures to destroy suchinformation as and when it is discovered.

 

4.16         PromegaCorporation (PGL3) Sublicense.  Within one hundred eighty (180) days of theClosing, upon the request of Taconic, Caliper shall execute a sublicenseagreement providing Taconic with the use of the technology claimed in U.S.Patent No. 5,670,356 owned by Promega Corporation (PGL3).

 

ARTICLE 5

 

CONDITIONS TO THE CLOSING

 

5.1           Conditions tothe Obligations of Each Party to Effect the Transaction.  The respective obligations of Caliper andTaconic to consummate the Closing shall be subject to the satisfaction, at orprior to the Closing, of the following conditions:

 

(a)      No Order.  No Governmental Entity shall have enacted,issued, promulgated, enforced or entered any statute, rule, regulation,executive order, decree, injunction or other order (whether temporary,preliminary or permanent) which is in effect and which has the effect of makingthe Transaction illegal or otherwise prohibiting the consummation of theTransaction.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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(b)      No Injunctions orRestraints; Illegality.  Notemporary restraining order, preliminary or permanent injunction or other orderissued by any court of competent jurisdiction or other legal restraint orprohibition (i) preventing the consummation of the Transaction, (ii) prohibitingTaconic’s ownership or operation of any portion of the business of the Company,or (iii) compelling Taconic or the Company to dispose of or hold separateall or any material portion of the business or assets of Taconic, the Companyor any of their respective Subsidiaries or Affiliates as a result of theTransaction, shall be in effect, nor shall any proceeding brought by anadministrative agency or commission or other governmental authority orinstrumentality, domestic or foreign, seeking any of the foregoing bethreatened or pending.

 

(c)      LPTA Distribution and SupplyAgreement.  Caliper andTaconic shall have executed and delivered the Distribution and Supply Agreementin the form attached hereto as Exhibit C.

 

(d)      Escrow Agreement. Caliper,Taconic and the Escrow Agent shall each have executed and delivered to each ofthe other parties the Escrow Agreement in the form attached hereto as Exhibit D,and such Escrow Agreement shall be in full force and effect.

 

5.2           Additional Conditions to the Obligations of Taconic.  The obligation of Taconic to effect theTransaction also shall be subject to the satisfaction at or prior to theClosing of each of the following conditions, any of which may be waived, inwriting, exclusively by Taconic:

 

(a)      Governmental Approval. Caliper shallhave obtained all Governmental Entity approvals required to legally consummatethe Transaction and those required so that the consummation of thosetransactions contemplated by this Agreement will not trigger any Conflict withany of the items set forth in Section 2.5 hereof.

 

(b)      Litigation. There shallbe no action, suit, claim or proceeding of any nature pending, or overtlythreatened, against Taconic or the Company, or Caliper in respect of theCompany, their respective Subsidiaries or properties or any of their respectiveofficers or directors, arising out of, or in any way connected with, theTransaction or the other transactions contemplated by the terms of thisAgreement.

 

(c)      Mandatory Third-PartyConsents. Caliper shall have obtained all necessary consentsto assignment, waivers and approvals, and timely provided all notifications,with respect to the transactions contemplated by this Agreement under thoseContracts listed on Schedule 5.2(c) of the Disclosure Schedule.

 

(d)      Mandatory Sublicense fromCaliper to Taconic.  Calipershall deliver to Taconic sublicenses executed by Caliper for all licenseslisted on Schedule 5.2(d) of the Disclosure Schedule.

 

(e)      Completion of License forImaging Services.  Caliper andTaconic will have executed the License Agreement in the form attached hereto asExhibit E.

 

(f)       Cancellation ofInter-Company Indebtedness. Immediately prior to theClosing, all inter-company Indebtedness between the Company, on the one hand,and Caliper and its other Subsidiaries on the other hand, shall have beensatisfied either as a distribution from additional paid in capital or as acontribution to the capital of the Company, as applicable, 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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and shall have been fully satisfied thereby, all ina manner that does not result in gross income to the Company.

 

(g)      Resignation of Officers andDirectors. Taconic shall have received a written resignationfrom each of the officers and directors of the Company effective as of the datehereof.

 

(h)      Certificate of Secretary ofCaliper and the Company. Taconic shall have received a certificate,validly executed by the Secretary of the Company, certifying as to (i) theterms and effectiveness of the Company Charter Documents, (ii) the validadoption of resolutions of the Board of Directors of Caliper (whereby the Transaction and the transactionscontemplated by this Agreement were duly approved by the Board of Directors ofCaliper), and (iii) the incumbency of the executive officers of Caliper.

 

(i)       Certificates of GoodStanding. Taconic shall have received (i) a long-formcertificate of good standing for the Company from the Secretary of State of theState of Ohio, dated within five (5) days prior to the Closing Date and (ii) acertificate of good standing as a foreign corporation or similar certificate ofthe Company issued by the Secretary of the State of New Jersey dated withinfive (5) days prior to the Closing certifying as to the good standing ofthe Company as a “foreign corporation.”

 

(j)       FIRPTA Certificate. Taconic shallhave received a certificate in a form reasonably satisfactory to Taconic thatCaliper is not a foreign person in accordance with Treasury Regulations under Section 1445of the Code, validly executed by a duly authorized officer of Caliper.

 

(k)      Employment Continuation. TheContinuing Employees listed on Section 5.2(l) of the DisclosureSchedule shall have accepted Taconic’s offer of employment and executed allemployment-related documents requested by Taconic.

 

(l)       Data Room. Caliper shallhave provided to Taconic an electronic copy of the Data Room as of thedate of this Agreement and a second electronic copy as of the Closing, togetherwith all records of access and use thereof.

 

5.3           Additional Conditions to the Obligations of Caliper.  The obligation of Caliper to effect theTransaction also shall be subject to the satisfaction at or prior to theClosing of each of the following conditions, any of which may be waived, inwriting, exclusively by the Caliper:

 

(a)      Governmental Approval. Caliper shallhave obtained all Governmental Entity approvals required to legally consummatethe Transaction and those required so that the consummation of thosetransactions contemplated by this Agreement will not trigger any Conflict withany of the items set forth in Section 2.5 hereof.

 

(b)      Litigation. There shallbe no action, suit, claim or proceeding of any nature pending, or overtlythreatened, against Caliper in respect of the Company or any of its officers ordirectors, arising out of, or in any way connected with, the Transaction or theother transactions contemplated by the terms of this Agreement.

 

(c)      Certificate of Secretary ofTaconic. Caliper shall have received a certificate, validly executed by theSecretary of Taconic, certifying as to (i) the valid adoption ofresolutions of the Board of Directors of Taconic (whereby the Transaction and the transactions 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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contemplated by thisAgreement were duly approved by the Board of Directors of Taconic), and (ii) theincumbency of the executive officers of Taconic.

 

(d)      Certificates of GoodStanding. Caliper shall have received a long-formcertificate of good standing for Taconic from the Secretary of State of theState of New York, dated within five (5) days prior to the Closing Date.

 

ARTICLE 6

 

INDEMNIFICATION AND ESCROW

 

6.1           Survival.

 

(a)      Caliper.  The representations and warranties of Calipercontained in this Agreement, or in any certificate or instrument delivered toTaconic pursuant to this Agreement, shall survive until [***] (the expirationof such period, the “Survival Date”); *provided,however*, that (i) the representations and warranties of Caliperin Section 2.2 (Company Capital Structure), and Section 2.4(Authority) shall survive indefinitely, (ii) the representations andwarranties of Caliper in Section 2.22 (Environmental) shall surviveuntil the second anniversary of the Closing Date, and (iii) therepresentations and warranties of Caliper contained in Section 2.10(Tax Matters) shall survive until ninety (90) days after the expiration of theapplicable statute of limitations (each of such representations and warrantiesdescribed in clause (i), (ii) or (iii) a “Special Representation”).If an indemnification claim is properly asserted in writing pursuant to Section 6.3prior to the expiration (as provided in this Section 6.1(a)) of therepresentation or warranty that is the basis for such claim, then suchrepresentation or warranty shall survive beyond the Survival Date until, butonly for the purpose of, the resolution of such claim.

 

(b)      Covenants.  All of the covenants and other agreementscontained in this Agreement that contemplate performance thereof following theClosing Date shall survive the Closing Date indefinitely or until otherwiseterminated in accordance with their terms.

 

6.2           Indemnification by Caliper.

 

(a)      Incurred Losses. Subject tothe terms and conditions of this Article 6, from and after theClosing, Caliper shall indemnify Taconic and its officers, directors andAffiliates, including the Company, from and after the Closing (any, an “IndemnifiedParty” and collectively, the “Indemnified Parties”), for any claims,losses, liabilities, damages, deficiencies, diminution in value, costs,interests, awards, judgments, penalties and expenses, including reasonableattorneys’ fees and expenses of investigation and defense (hereinafterindividually a “Loss” and collectively “Losses”) paid, incurred,accrued or sustained by such Indemnified Parties or any of them, directly orindirectly, as a result of:

 

(i)                                     any breach orinaccuracy of a representation or warranty of Caliper or the Company containedin this Agreement or in any certificate or other instruments delivered pursuantto this Agreement;

 

(ii)                                  any failure byCaliper, or failure by Caliper to cause the Company, to perform or comply withany covenant or other agreement 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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applicable to it contained in this Agreement or inany certificate or other instruments delivered pursuant to this Agreement;

 

(iii)                               the matterdescribed on Section 2.9(f) of the Disclosure Schedule; and

 

(iv)                              [***]: (A) relatedto, or arising from, [***] as of the Closing, including without limitation,[***] that asserts, directly or indirectly, [***] or (B) any [***] thatasserts, directly or indirectly that the [***] because of the transactions contemplatedby this Agreement.

 

(b)      Indemnification Thresholdand Cap. No Indemnified Party may recover any Losses (i) unless and untilwritten notice pursuant to Section 6.3(a) identifying a Lossor Losses in excess of [***] Dollars ($[***])****inthe aggregate (the “Threshold Amount”) has or have been delivered to theEscrow Agent by one or more Indemnified Parties, in which case such IndemnifiedParty shall be entitled to recover all Losses so identified, or (ii) inexcess of (A) [***] Dollars ($[***]) (the “General Indemnification Cap”)for Losses incurred under Section 6.2(a)(i) or (B) [***]Dollars ($[***])****(the “IP Indemnification Cap”together with the General Indemnification Cap, the “Indemnification Cap”)for Losses incurred under Section 6.2(a)(iv) (“IP Losses”);*provided that*, in the event andto the extent that any Indemnified Party incurs IP Losses that exceed the IPIndemnification Cap, such IP Losses may be applied to the GeneralIndemnification Cap if the General Indemnification Cap has not already beenexhausted.  By way of example only,assume hypothetically that there are Losses excluding IP Losses of $[***] andIP Losses of $[***].  In such case, theIP Losses would first be used against the IP Indemnification Cap, after whichthere would be $[***] in unreimbursed IP Losses.  The balance of $[***] in the GeneralIndemnification Cap after reimbursement of $[***] of non-IP losses would beavailable to provide reimbursement for the $[***] in unreimbursed IP Losses.Notwithstanding the foregoing, Taconic shall be entitled to recover for, andthe Threshold Amount and the Indemnification Cap shall not apply as a thresholdor cap to, any and all claims or payments made with respect to (A) allLosses incurred pursuant to clauses (ii) or (iii) of Section 6.2(a),(B) fraud or knowing or willful breach or inaccuracy of a representationor warranty contained herein or (C) any breach or inaccuracy of a SpecialRepresentation. With regard to the matter described in Section 6.2(a)(iii),Caliper shall continue the defense of the action described therein at its ownexpense and shall be solely responsible for any expenses and Losses incurred inconnection therewith.

 

(c)      Materiality; Knowledge; NoRight of Contribution. For the purpose of quantifying anIndemnified Party’s Losses under this Article 6 only, anyrepresentation or warranty given or made by the Company that is qualified inscope as to materiality (including the Company Material Adverse Effect) or asto Knowledge shall be deemed to be made or given without such qualification.There shall be no right of contribution from the Company or any of itsrespective officers and directors, with respect to any Loss claimed by anIndemnified Party.

 

(d)      Knowledge of Taconic. Any duediligence review, audit or other investigation or inquiry undertaken orperformed by or on behalf of Taconic shall not limit, qualify, modify or amendthe representations, warranties or covenants of, or indemnities by 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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Caliper made or undertaken pursuant to thisAgreement, irrespective of the knowledge and information received (or whichshould have been received) therefrom by Taconic other than as expresslyreflected on the Disclosure Schedule or the other Exhibits or Schedules to thisAgreement.

 

(e)      Treatment of IndemnificationPayments. All indemnification payments under this Agreementshall be treated as an adjustment to the Final Purchase Price for all Taxpurposes unless otherwise required by Law.

 

6.3           Claims for Indemnification.

 

(a)      Procedure for Claims. AnIndemnified Party wishing to assert a claim for indemnification under this Article 6(other than a third-party claim covered by Section 6.3(b) below)shall deliver to Caliper a certificate (an “Officer’s Certificate”)signed by any officer of Taconic (or another Indemnified Party)(A) stating that Taconic (or such other Indemnified Party) has paid,sustained, incurred or accrued, or reasonably anticipates that it will have topay, sustain, incur, or accrue Losses (the aggregate amount of such Lossesbeing referred to as the “Claimed Amount”), (B) specifying inreasonable detail the facts pertinent to such claim(s), the individual items ofLosses included in the amount so stated and the nature of basis forindemnification to which such item is related, and (C) demanding paymentof the Claimed Amount. Within forty five (45) days after delivery of suchOfficer’s Certificate, Caliper shall deliver to the Indemnified Party a writtenresponse in which Caliper shall: (I) agree that the Indemnified Party isentitled to receive all of the Claimed Amount with appropriate jointinstructions to the Escrow Agent if the Escrow Fund is then available forpayment to pay such amount, (II) agree that the Indemnified Party isentitled to receive part, but not all, of the Claimed Amount (the “AgreedAmount”) (with appropriate joint instructions to the Escrow Agent if theEscrow Fund is then available for payment to pay the Agreed Amount, or (III) contestthat the Indemnified Party is entitled to receive any of the Claimed Amount. IfCaliper in such response contests the payment of all or part of the ClaimedAmount, then Caliper and the Indemnified Party shall use good faith efforts toresolve such dispute in accordance with Section 6.3(c) below.Failure of Caliper to timely respond in writing shall be treated as agreementthat the Indemnified Party is entitled to the Claimed Amount from the EscrowFund or otherwise directly from Caliper if payment from the Escrow Fund is notavailable.

 

(b)      Procedure for Third-PartyClaims. All claims for indemnification made under this Agreement resultingfrom, related to or arising out of a third-party claim against an IndemnifiedParty shall be made in accordance with the following procedures. In the eventan Indemnified Party becomes aware of a third party claim which suchIndemnified Party reasonably believes may result in a Loss, such IndemnifiedParty shall promptly notify Caliper of such claim by delivery of an Officer’sCertificate to Caliper. Delay or failure in so notifying Caliper shall relieveCaliper of its obligations under this Article 6 only to the extent,if at all, that Caliper is prejudiced by reason of such delay or failure.  If there is a third party claim that, ifadversely determined would give rise to a right of recovery for Losseshereunder, then any amounts incurred or accrued in defense of such third partyclaim, regardless of the outcome of such claim, shall be deemed Losseshereunder.  Within forty five (45) days afterdelivery of such Officer’s Certificate, Caliper may, upon written noticethereof to the Indemnified Party, assume control of the defense of such action,suit, proceeding or claim other than Tax Claims if (1) Caliper provideswritten notice to such Indemnified Party that Caliper intends to undertake suchdefense and that Caliper will indemnify the Indemnified Parties against allLosses 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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resulting from or relating to such third-partyclaim; (2) the third-party claim does not seek an injunction or otherequitable relief; (3) settlement of or an adverse judgment with respect tothe third-party claim is not, in the good faith judgment of Taconic, likely toestablish a precedent adverse relating to the Intellectual Property orIntellectual Property Rights of Taconic and its Subsidiaries, and (4) thedefense of the third-party claim is conducted actively and diligently by legalcounsel reasonably acceptable to such Indemnified Party. If Caliper does notassume control of such defense, the Indemnified Party shall control suchdefense. The party not controlling such defense may participate therein at itsown expense; *provided, however,* that ifCaliper assumes control of such defense and the Indemnified Party reasonablyconcludes, based on advice of counsel, that Caliper and the Indemnified Partyhave conflicting interests with respect to such action, suit, proceeding orclaim, the reasonable fees and expenses of counsel to the Indemnified Partysolely in connection therewith shall be considered “Losses” for purposes ofthis Agreement; *provided, however,* that in noevent shall Caliper be responsible for the fees and expenses of more than onecounsel per jurisdiction for all Indemnified Parties. The party controllingsuch defense shall keep the other party reasonably advised of the status ofsuch action, suit, proceeding or claim and the defense thereof and shallconsider recommendations made by the other party with respect thereto. TheIndemnified Party shall not agree to any settlement of such action, suit, proceedingor claim without the prior written consent of Caliper, not to be unreasonablywithheld, delayed or conditioned. Caliper shall not agree to any settlement ofsuch action, suit, proceeding or claim that does not include a complete releaseof all potential Indemnified Parties from all Liability with respect thereto orthat imposes any Liability on any potential Indemnified Party without the priorwritten consent of such Indemnified Party.

 

(c)      Resolution of Conflicts. In caseCaliper shall object in writing to any claim or claims made in any Officer’sCertificate, Caliper and Indemnified Party shall attempt in good faith to agreeupon the rights of the respective parties with respect to each of such claimswithin forty-five (45) days following the delivery by Caliper of its responseto such Officer’s Certificate. If Caliper and Indemnified Party should soagree, a memorandum setting forth such agreement shall be prepared and signedby both parties and, in the case of a claim against the Escrow Fund, shall befurnished to the Escrow Agent. The Escrow Agent shall be entitled to rely onany such memorandum and make distributions from the Escrow Fund in accordancewith the terms thereof.

 

6.4           Escrow Fund.  As of the Closing, Taconic, ComputershareTrust Company, N.A. (the “Escrow Agent”) and Caliper shall execute anddeliver the Escrow Agreement in substantially the form attached hereto as Exhibit D(the “Escrow Agreement”), and, concurrently with the Closing, Taconicshall deposit the Escrow Amount with the Escrow Agent to be held as a trustfund (the “Escrow Fund”) for the purpose of securing the indemnificationobligations set forth in Article 6 of this Agreement and thepost-closing adjustment payment obligations set forth in Section 1.6.The Escrow Fund shall be held by the Escrow Agent under the Escrow Agreementpursuant to the terms thereof. The Escrow Fund shall be held as a trust fund asthe first source but not the only source of indemnification for Taconic andpayment of post-closing adjustment payments to Taconic hereunder, shall not besubject to any lien, attachment, trustee process or any other judicial processof any creditor of any party, and shall be held and disbursed solely for thepurposes and in accordance with the terms of the Escrow Agreement.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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6.5           Indemnification by Taconic.  The representations and warranties of Taconiccontained in this Agreement, or in any certificate or instrument deliveredpursuant to this Agreement, shall survive until the first anniversary of theClosing Date, except that the representations and warranties of Taconic in Section 3.1(b) shallsurvive indefinitely.  If anindemnification claim is properly asserted in writing by Caliper prior to suchexpiration date then such representation or warranty shall survive beyond suchdate until, but only for the purpose of, the resolution of such claim.  All of the covenants and other agreementscontained in this Agreement that contemplate performance thereof following theClosing Date shall survive the Closing Date indefinitely or until otherwiseterminated in accordance with their terms. Subject to the limits set forth in this Section 6.5, Taconic shallindemnify Caliper and its officers, directors, and Affiliates (the “CaliperIndemnified Parties”) for any Losses paid, incurred, accrued or sustained bysuch Caliper Indemnified Parties or any of them, directly or indirectly, as aresult of (i) any breach or inaccuracy of a representation or warranty ofTaconic contained in this Agreement or in any certificate or other instrumentsdelivered pursuant to this Agreement or (ii) any failure by Taconic toperform or comply with any covenant or other agreement applicable to itcontained in this Agreement or in any certificate or other instrumentsdelivered pursuant to this Agreement. Notwithstanding the foregoing, (x) no Caliper Indemnified Party mayrecover any Losses unless and until the Caliper Indemnified Parties haveprovided Taconic with written notice identifying a Loss or Losses in excess ofthe Threshold Amount, in which case the Caliper Indemnified Partiesshall be entitled to recover all Losses so identified, and (y) CaliperIndemnified Parties shall in no event be entitled to recover Losses in theaggregate in excess of the Indemnification Cap, *provided*,*however*, that the foregoing limitationsshall not apply to any claim by any Caliper Indemnified Party based on a breachthe representations and warranties of Taconic in Section 3.1(b) orto a breach of a covenant of Taconic contained herein.

 

ARTICLE 7

 

GENERAL PROVISIONS

 

7.1           Notices.  All notices and other communicationshereunder shall be in writing and shall be deemed duly delivered (i) seven(7) Business Days after being sent by registered or certified mail, returnreceipt requested, postage prepaid, (ii) one (1) Business Day afterbeing sent for next Business Day delivery, fees prepaid, via a reputablenationwide overnight courier service, or (iii) on the first Business Dayfollowing the date of confirmation of receipt of transmission by facsimile, ineach case to the intended recipient as set forth below:

 

(a)   if to Taconic, to:

 

TaconicFarms, Inc.

OneHudson City Centre

Hudson,NY 12534

Attention:  Chief Executive Officer and

 Chief Financial Officer

FacsimileNo.: (518) 597-3905

 

witha copy (which shall not constitute notice) to:

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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Sullivan &Worcester LLP

OnePost Office Square

Boston, MA 02109

Attention: Edwin L. Miller Jr.

Facsimile No.: (617) 338-2880

 

(b)   if to Caliper, to:

 

CaliperLife Sciences, Inc.

68Elm Street

Hopkinton,MA 01748

Attention:  Chief Financial Officer

FacsimileNo.: (508) 497-2726

 

witha copy (which shall not constitute notice) to:

 

CaliperLife Sciences, Inc.

850Marina Village Parkway

Alameda,CA 94501

Attention:  General Counsel

FacsimileNo.: (510) 291-6136

 

Anyparty to this Agreement may change the address to which notices and othercommunications hereunder are to be delivered by giving the other parties tothis Agreement notice in the manner herein set forth.

 

7.2           Interpretation.  The words “include,” “includes” and “including”when used herein shall be deemed in each case to be followed by the words “withoutlimitation.” The table of contents and headings contained in this Agreement arefor reference purposes only and shall not affect in any way the meaning orinterpretation of this Agreement.

 

7.3           Counterparts.  This Agreement may be executed by facsimileand in one or more counterparts, all of which shall be considered one and thesame agreement and shall become effective when one or more counterparts havebeen signed by each of the parties and delivered to the other party, it beingunderstood that all parties need not sign the same counterpart.

 

7.4           EntireAgreement; Assignment.  ThisAgreement, the Disclosure Schedule, the Confidential Disclosure Agreement, andthe documents and instruments and other agreements among the parties heretoreferenced herein: (i) constitute the entire agreement among the partieswith respect to the subject matter hereof and supersede all prior agreements andunderstandings both written and oral, among the parties with respect to thesubject matter hereof; (ii) are not intended to confer upon any otherperson any rights or remedies hereunder; and (iii) shall not be assignedby operation of Law or otherwise, except that Taconic may assign its rights anddelegate its obligations hereunder to its Affiliates so long as Taconic remainsobligated to perform those obligations required to be performed by Taconichereunder.

 

7.5           Severability.  In the event that any provision of thisAgreement or the application thereof, becomes or is declared by a court ofcompetent jurisdiction to be illegal, void or 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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unenforceable,the remainder of this Agreement will continue in full force and effect and theapplication of such provision to other persons or circumstances will beinterpreted so as reasonably to effect the intent of the parties hereto. Theparties further agree to replace such void or unenforceable provision of thisAgreement with a valid and enforceable provision that will achieve, to theextent possible, the economic, business and other purposes of such void orunenforceable provision.

 

7.6           OtherRemedies.  Any and all remediesherein expressly conferred upon a party will be deemed cumulative with and notexclusive of any other remedy conferred hereby, or by law or equity upon suchparty, and the exercise by a party of any one remedy will not preclude theexercise of any other remedy.

 

7.7           GoverningLaw.  EXCEPT AS OTHERWISE PROVIDEDHEREIN, ALL QUESTIONS AND/OR DISPUTES CONCERNING THE CONSTRUCTION, VALIDITY ANDINTERPRETATION OF THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY SHALLBE GOVERNED BY THE INTERNAL LAWS, AND NOT THE LAW OF CONFLICTS, OF THE STATE OFNEW YORK.

 

7.8           Rules ofConstruction.  The parties heretoagree that they have been represented by counsel during the negotiation andexecution of this Agreement and, therefor, waive the application of any Law,holding or rule of construction providing that ambiguities in an agreementor other document will be construed against the party drafting such agreementor document.

 

7.9           SpecificPerformance.  The parties heretoagree that irreparable damage would occur in the event that any of theprovisions of this Agreement were not performed in accordance with theirspecific terms or were otherwise breached. It is accordingly agreed that theparties shall be entitled to an injunction or injunctions to prevent breachesof this Agreement and to enforce specifically the terms and provisions hereof,this being in addition to any other remedy to which they are entitled at law orin equity.

 

7.10         Attorneys’Fees.  If any action or otherproceeding relating to the enforcement of any provision of this Agreement isbrought by any party hereto, the prevailing party shall be entitled to recoverreasonable attorneys’ fees, costs, and disbursements (in addition to any otherrelief to which the prevailing party may be entitled).

 

7.11         WAIVEROF JURY TRIAL.  EACH OF THE PARTIESHERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT TO TRIAL BY JURY AND ANY ACTION,PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE)ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF ANY PARTY HERETOIN NEGOTIATION, ADMINISTRATION, PERFORMANCE OR ENFORCEMENT HEREOF.

 

ARTICLE 8

 

DEFINITIONS

 

Forall purposes of this Agreement, the following terms shall have the followingrespective meanings:

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“AcquisitionDate” shall mean August 9, 2006.

 

“Affiliate”shall mean, with respect to any person, any other person directly or indirectlythrough one or more intermediaries controlling, controlled by or under commoncontrol with such other person.

 

“AffiliatedGroup” shall mean any affiliated group within the meaning of Section 1504(a) ofthe Code or any similar group defined under a similar provision of federal,state, local, or foreign income or other Tax Law, including any provision offederal, state, local, or foreign income or other Tax Law that imposes joint orseveral liability for Taxes on the members of such group.

 

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

 

“Agreement”shall have the meaning set forth in the preamble hereof.

 

“BusinessDay” shall mean any day other than (a) a Saturday or Sunday or(b) a day on which banking institutions located in Boston, Massachusettsare permitted or required by Law to remain closed.

 

“CaliperCompany” shall have the meaning set forth in Section 2.2(b) hereof.

 

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

 

“Closing”shall have the meaning set forth in Section 1.1 hereof.

 

“ClosingBalance Sheet” shall have the meaning set forth in Section 1.5hereof.

 

“ClosingDate” shall have the meaning set forth in Section 1.1 hereof.

 

“COBRA”shall mean the Consolidated Omnibus Budget Reconciliation Act of 1985, asamended and as codified in Section 4980B of the Code and Section 601et. seq. of ERISA.

 

“Code”shall mean the Internal Revenue Code of 1986, as amended.

 

“CommonStock” shall have the meaning set forth in Section 2.2(a) hereof.

 

“Company”shall have the meaning set forth in the preamble hereof.

 

“CompanyCapital Stock” shall mean all authorized capital stock of the Company.

 

“CompanyCash” shall mean, with respect to the Company, as of the close of businesson the Closing Date, all cash, cash equivalents and marketable securities heldon deposit in the bank accounts of the Company at such time. For avoidance ofdoubt, Company Cash shall (1) be calculated net of issued but unclearedchecks and drafts, and (2) include checks and drafts deposited for theaccount of the Company or received in the Company’s lockbox prior to thepreparation of the Closing Balance Sheet.

 

“CompanyCharter Documents” shall have the meaning set forth in Section 2.1hereof.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“CompanyEmployee Plan” shall mean an employee benefit plan as defined in Section 3(3) ofERISA and any material benefit arrangement that is not a Plan, including (i) anyemployment or consulting agreement, (ii) any arrangement providing forinsurance coverage or workers’ compensation benefits, (iii) any incentivebonus or deferred bonus arrangement, (iv) any arrangement providingtermination allowance, severance pay, salary continuation for disability, orother leave of absence, supplemental unemployment benefits, lay-off, reductionin force or similar benefits, (v) any stock option or equity compensationplan, (vi) any deferred compensation plan, (vii) any compensationpolicy or practice (including without limitation sick and vacation pay policiesor practices), (viii) any educational assistance arrangements or policies,(ix) any plan governed by Section 125 of the Code, any fringe benefit(including without limitation company cars) and (xi) any change of controlarrangements or policies, in each case under which any Company Personnelreceives any compensation or benefits.

 

“CompanyIntellectual Property” shall mean any and all Licensed Company IntellectualProperty and Owned Company Intellectual Property.

 

“CompanyMaterial Adverse Effect” shall mean any change, event or effect that ismaterially adverse to (i) the business, assets (whether tangible orintangible), condition (financial or otherwise), prospects, results ofoperations or capitalization of the Company or (ii) the Company’s abilityto consummate the transactions contemplated by this Agreement, excluding anychanges, events or effects that result from: (i) any change arising out ofconditions affecting the economy or industry of the Company in general whichdoes not affect the Company in a materially adverse manner relative to otherparticipants in the economy or such industry, respectively, (ii) anychange that is due to actions required to be taken by the Company pursuant tothe terms of this Agreement, or (iii) the announcement of this Agreementand the transactions contemplated hereby.

 

“CompanyPersonnel” shall mean any current Employee, consultant or director of theCompany.

 

“CompanyPrivacy Obligations” shall have the meaning set forth in Section 2.35hereof.

 

“CompanyPrivacy Policies” shall have the meaning set forth in Section 2.35hereof.

 

“CompanyProducts and Services” shall have the meaning set forth in Section 2.13(a) hereof.

 

“ConfidentialDisclosure Agreement” shall have the meaning set forth in Section 4.1hereof.

 

“Conflict”shall have the meaning set forth in Section 2.5 hereof.

 

“ContinuingEmployee” shall have the meaning set forth in Section 4.6hereof.

 

“Contract”shall have the meaning set forth in Section 2.5 hereof.

 

“CurrentBalance Sheet” shall have the meaning set forth in Section 2.7(a) hereof.

 

“CustomerInformation” shall have the meaning set forth in Section 2.12(f) hereof.

 

“DataRoom” shall have the meaning set forth in Section 2.37 hereof.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“DeferredRevenue Amount” shall mean (a) [***] percent ([***]%) of the statedvalue of any deferred revenue and customer deposits on the Closing BalanceSheet up to the balance sheet stated value of $[***]****and(b) [***] percent (***]%) of the stated value of any deferred revenue andcustomer deposits on the Closing Balance Sheet above the balance sheet statedvalue of $[***].

 

“DisclosureSchedule” shall have the meaning set forth in preamble to Article 2hereof.

 

“EnvironmentalLaws” shall mean all federal, state, local and foreign Laws issued,promulgated, approved or entered relating to environmental matters, theprotection of the environment, the protection of human health and safety, orexposure to Hazardous Materials, including without limitation workplace healthand safety Laws, packaging and labeling Laws and Laws relating to the Releaseor threatened Release of Hazardous Materials to the environment (including,without limitation, ambient air, surface water, ground water, land surface orsubsurface strata) or otherwise relating to the presence, manufacture,processing, distribution, use, treatment, storage, disposal, transport orhandling of Hazardous Materials.

 

“EnvironmentalOrder” shall mean any order, judgment, injunction, award, decree or writrelating to the environment or imposed pursuant to Environmental Laws.

 

“EnvironmentalPermits” shall mean all Permits required by or issued pursuant toapplicable Environmental Laws.

 

“Equipment”shall have the meaning set forth in Section 2.12(e) hereof.

 

“ERISA”shall mean the Employee Retirement Income Security Act of 1974, as amended.

 

“ERISAAffiliate” shall mean any other person or entity under common control withthe Company within the meaning of Section 414(b), (c), (m) or (o) ofthe Code or Section 4001(a)(14) or 4001(b)(1) of ERISA, and theregulations issued thereunder.

 

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

 

“EscrowAmount” shall mean ten percent of the Estimated Purchase Price.

 

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

 

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

 

“EstimatedCompany Cash” shall have the meaning set forth in Section 1.4(a)(i) hereof.

 

“EstimatedIndebtedness” shall have the meaning set forth in Section 1.4(a)(ii) hereof.

 

“EstimatedNet Working Capital” shall have the meaning set forth in Section 1.4(a)(iv) hereof.

 

“EstimatedPurchase Price” shall have the meaning set forth in Section 1.4(b) hereof.

 

“Final Purchase Price” shall have the meaning set forth in Section 1.6hereof.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“FinancialStatements” shall have the meaning set forth in Section 2.7(a) hereof.

 

“GAAP”shall mean United States generally accepted accounting principles, consistentlyapplied.

 

“GeneralIndemnification Cap” shall have the meaning set forth in Section 2.6hereof.

 

“GovernmentalEntity” shall have the meaning set forth in Section 2.6 hereof.

 

“HazardousMaterials” shall mean all hazardous substances, wastes, extremely hazardoussubstances, hazardous materials, hazardous wastes, hazardous constituents,solid wastes, special wastes, toxic substances, pollutants, contaminants,petroleum or petroleum derived substances or wastes, and related materials,including without limitation any such materials defined, listed, regulated oridentified under or described in any Environmental Laws (including, by way ofexample and without limitation, spent solvents, PCBs, urea-formaldehyde, radon,lead or lead based paints or materials, asbestos and asbestos containingmaterials).

 

“HealthData” shall have the meaning set forth in Section 2.30 hereof.

 

“HIPAA”shall mean the Health Insurance Portability and Accountability Act of 1996, asamended.

 

“ImmigrationLaws” shall have the meaning set forth in Section 2.36 hereof.

 

“Indebtedness”shall mean, with respect to any person (a) all obligations of such personfor borrowed money, whether current or funded, secured or unsecured, (b) allobligations of such person for the deferred purchase price of any property orservices (other than deferred revenue, customer deposits and trade accountspayable arising in the ordinary course of business of such person), (c) allobligations of such person secured by a purchase money mortgage or other liento secure all or part of the purchase price of property subject to suchmortgage or lien, (d) all obligations under leases which shall have beenor should be, in accordance with GAAP or other generally accepted accountingprinciples as applicable to such person, recorded as capital leases in respectof which such person is liable as lessee, (e) any obligation of suchperson in respect of bankers’ acceptances, (f) any obligations secured byLiens on property acquired by such person, whether or not such obligations wereassumed by such person at the time of acquisition of such property, (g) anyamounts owed to a Caliper Company, (h) all obligations of a type referredto in clauses (a), (b), (c), (d), (e), (f) or (g) above which isdirectly or indirectly guaranteed by such person or which it has agreed(contingently or otherwise) to purchase or otherwise acquire or in respect ofwhich it has otherwise assured a credit against loss, (i) any refinancingsof any of the foregoing obligations, (j) any penalties or fees accruedunder any of the foregoing, including those resulting from the prepayment orrepayment of any of the foregoing obligations and (k) all accrued interestpayable on any of the foregoing obligations.

 

“IndemnificationCap” shall have the meaning set forth in Section 2.6 hereof.

 

“IndemnifiedParty” shall have the meaning set forth in Section 6.2(a) hereof.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“IntellectualProperty” shall mean any or all of the following: (i) proprietaryinventions (whether patentable or not), invention disclosures, industrialdesigns, improvements, trade secrets, proprietary information, know how,technology, technical data and customer lists, and all documentation relatingto any of the foregoing; (ii) business, technical and know-howinformation, non-public information, and confidential information includingdatabases and data collections and all rights therein; (iii) works ofauthorship (including computer programs and source and object code),architecture, artwork, logo images, documentation, files, records, schematics,test data and development tools; (iv) processes, devices and prototypes;(v) logos, trade names, trade dress, trademarks, service marks, World WideWeb addresses, uniform resource locators and domain names, tools, methods andprocesses; and (vii) any similar or equivalent property of any of theforegoing (as applicable).

 

“IntellectualProperty Rights” shall mean any or all of the following and all worldwidecommon law and statutory rights in, arising out of, or associated therewith: (i) patentsand applications therefor and all reissues, divisions, renewals, extensions,provisionals, continuations and continuations-in-part thereof throughout the world(“Patents”); (ii) copyrights, copyrights registrations andapplications therefor, and all other rights corresponding thereto throughoutthe world including moral and economic rights of authors and inventors, howeverdenominated (“Copyrights”); (iii) industrial designs and anyregistrations and applications therefor throughout the world; (iv) tradenames, logos, common law trademarks and service marks, trademark and servicemark registrations and applications therefor and all goodwill associated therewiththroughout the world (“Trademarks”); (v) trade secrets (including,those trade secrets defined in the Uniform Trade Secrets Act and undercorresponding foreign statutory and common law), business, technical andknow-how information, non-public information, and confidential information andrights to limit the use or disclosure thereof by any person; includingdatabases and data collections and all rights therein (“Trade Secrets”);and (vi) any similar or equivalent rights to any of the foregoing (as applicable).

 

“IntercompanyTransactions” shall have the meaning set forth in Section 2.17(a) hereof.

 

“InterestedPerson” shall have the meaning set forth in Section 2.17(a) hereof.

 

“IPIndemnification Cap” shall have the meaning set forth in Section 2.6hereof.

 

“IRS”shall mean the United States Internal Revenue Service.

 

“Knowledge”shall mean with respect to Caliper, the knowledge of the officers and directorsof Caliper and the Company.

 

“Law”shall mean any law, statute, ordinance, rule, regulation, code, order,judgment, injunction, decree or other provision having the force or effect oflaw enacted, issued, promulgated, enforced or ordered by a Governmental Entity.

 

“LeaseAgreements” shall have the meaning set forth in Section 2.12(b) hereof.

 

“LeasedReal Property” shall have the meaning set forth in Section 2.12(a) hereof.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“Liability”shall mean, with respect to any person, any liability or obligation of suchperson of any kind, character or description, whether known or unknown,absolute or contingent, accrued or unaccrued, disputed or undisputed,liquidated or unliquidated, secured or unsecured, joint or several, due or tobecome due, vested or unvested, executory, determined, determinable orotherwise, and whether or not the same is required to be accrued on thefinancial statements of such person.

 

“Licensed-InIntellectual Property” shall mean all Intellectual Property andIntellectual Property Rights licensed to the Company.

 

“Licensed-OutIntellectual Property” shall mean all Intellectual Property andIntellectual Property Rights licensed by the Company to any person, includingCaliper and its Subsidiaries other than the Company.

 

“LicensedCompany Intellectual Property” shall have the meaning set forth in Section 2.13(a).

 

“Liens” means all securityinterests, liens, pledges, charges, claims, encroachments, defects of title,options, rights of first refusal or first offer, easements, licenses, covenantsor any other encumbrances or restrictions on the use or exercise of anyattribute of ownership, pledges, charges or encumbrances of any kind.

 

“Loss”shall have the meaning set forth in Section 6.2(a) hereof.

 

“MadeAvailable” shall mean, with respect to a document, that such document hasbeen posted by the Company to the Data Room and that Taconic has beengranted unrestricted access to view such document.

 

“NetWorking Capital” shall mean (as finally determined under Section 1.15(i)) all current assets of the Company (excluding Company Cash and deferred taxassets) as of the close of business on the Closing Date minus (ii) allcurrent liabilities of the Company (excluding Indebtedness, deferred revenueand deferred tax liabilities) as of the close of business on the Closing Date.Notwithstanding the foregoing, Net Working Capital shall be calculated as ofthe Closing with respect to all amounts required to be forgiven or dischargedimmediately prior to the Closing.

 

“NetWorking Capital Adjustment” shall mean the amount by which Net WorkingCapital is more than $[***]****above theTarget Net Working Capital Amount or is more than $[***] below the Target NetWorking Capital Amount, as applicable.

 

“Officer’sCertificate” shall have the meaning set forth in Section 6.3(a) hereof.

 

“Official”shall have the meaning set forth in Section 2.27 hereof.

 

“OpenSource Materials” shall have the meaning set forth in Section 2.13(k) hereof.

 

“OrdinaryCourse of Business” shall mean, with respect to a person or entity, theordinary course of the normal day-to-day operations of such person or entityconsistent with customs and past practice.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“OwnedCompany Intellectual Property” shall mean all Intellectual Property andIntellectual Property Rights that are owned by the Company.

 

“Permits”shall mean any permits, consents, licenses, certificates, registrations,certificates of occupancy or use, variances, orders, governmentalauthorizations or approvals, or any other permits.

 

“Pre-ClosingTax Period” shall mean any taxable period that begins before the ClosingDate and ends on or before the Closing Date.

 

“Pre-ClosingTax Return” shall have the meaning set forth in Section 4.11(b) hereof.

 

“Pre-ClosingTaxes” shall mean (i) all Taxes attributable to or payable withrespect to a Pre-Closing Tax Period and (ii) in the case of any taxableperiod that includes (but does not end on) the Closing Date, (x) theamount of any income or other Taxes measured on the basis of actual economicactivity (such as sales Taxes) that are attributable or payable with respect tosuch period determined on a closing of the books as of the close of business onthe Closing Date, and for such purpose, the taxable period of any partnershipor other pass-through entity in which the Company holds a beneficial interestshall be deemed to terminate at such time, and (y) the amount of any otherTaxes (if not described in the preceding clause (x), such as ad valorem Taxes)that are attributable or payable with respect to the period determined on a prorata basis with reference to the number of days in such period prior to andincluding the Closing Date relative to the number of days remaining in suchperiod after the Closing Date.

 

“PreliminaryStatement” shall have the meaning set forth in Section 1.14hereof.

 

“Release”shall mean any release, spill, emission, leaking, pumping, injection, deposit,disposal, discharge, dispersal, leaching or migration into the environment orout of any property, including the movement of any materials through or in theair, soil, surface water, ground water or property.

 

“RemedialAction” shall mean all actions to (a) abate, contain, ameliorate, cleanup, remove, treat, remediate or in any other way address any HazardousMaterials; (b) prevent the Release of Hazardous Materials so that they donot migrate or endanger or threaten to endanger human health or welfare or theindoor or outdoor environment; or (c) perform studies, investigations, andpre- or post-remedial monitoring and care; and (d) otherwise correct acondition of noncompliance with Environmental Laws.

 

“Section 280GPayment” shall have the meaning set forth in Section 2.24(g) hereof.

 

“Section 382Allocation Agreement” shall have the meaning set forth in Section 4.12(g) hereof.

 

“Share”shall have the meaning set forth in Section 1.1 hereof.

 

“SpecialRepresentation” shall have the meaning set forth in Section 6.1(a) hereof.

 

“SpecifiedThird Party Intellectual Property” shall have the meaning set forth in Section 2.13(f) hereof.

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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“Subsidiary”shall mean, with respect to any party, any corporation or other organization,whether incorporated or unincorporated, of which (i) such party or anyother subsidiary of such party is a general partner (excluding suchpartnerships where such party or any subsidiary of such party does not have amajority of the voting interest in such partnership) or (ii) at least amajority of the securities or other interests having by their terms ordinaryvoting power to elect a majority of the Board of Directors or others performingsimilar functions with respect to such corporation or other organization isdirectly or indirectly owned or controlled by such party or by any one or moreof its subsidiaries.

 

“SurvivalDate” shall have the meaning set forth in Section 6.1 hereof.

 

“Taconic”shall have the meaning set forth in the preamble hereof.

 

“TaconicMaterial Adverse Effect” shall mean any change, event or effect that ismaterially adverse to (i) the business, assets (whether tangible orintangible), condition (financial or otherwise), prospects, results ofoperations or capitalization of Taconic or (ii) Taconic’s ability toconsummate the transactions contemplated by this Agreement.

 

“TargetNet Working Capital Amount” shall mean $[***].

 

“Tax” or “Taxes” shall mean (i) anyand all taxes, charges, fees, levies or other assessments, including income,gross receipts, profits, margins, excise, real or personal property, lease,sales, withholding, social security, occupation, use, service, service use,value added, license, net worth, payroll, franchise, transfer and recordingtaxes, ad valorem, stamp, capital, environmental, employment, worker’scompensation, disability, social security, utility, production, unemploymentcompensation, windfall profits, duties, registration, business organization,alternative or add-on minimum, fees and charges, imposed by any GovernmentalEntity (whether domestic or foreign including any state, local or foreigngovernment or any subdivision or taxing agency thereof (including a UnitedStates possession)), whether computed on a separate, consolidated, unitary,combined or any other basis, and such term shall include any interest,penalties or additional amounts attributable to, or imposed upon, or withrespect to, any such taxes, charges, fees, levies or other assessments, (ii) Liabilityfor the payment of any amounts of the type described in clause (i) as apredecessor entity or as a transferee or a result of being or having been amember of an affiliated, consolidated, combined or unitary group, and (iii) Liabilityfor the payment of any amounts as a result of being party to any Tax sharingagreement or arrangement or as a result of any obligation to indemnify anyother person with respect to the payment of any amounts of the type describedin clause (i) or (ii).

 

“TaxClaim” shall mean any third party claim (i) relating to Taxes forwhich Caliper is liable pursuant to Section 4.11 or (ii) relatingto any breach of the representations and warranties contained in Section 2.10.

 

“Tax Return” shall mean any return,declaration, report, claim for refund, information return, or statement, andany schedule, attachment, or amendment thereto, including without limitationany consolidated, combined or unitary return or other document and anyschedule, attachment or amendment thereto filed or required by any GovernmentalEntity to be filed in connection with 

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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the determination, assessment, collection,imposition, payment, refund or credit of any federal, state, local or foreignTax or the administration of the Laws relating to any Tax.

 

“Third-PartyExpenses” shall have the meaning set forth in Section 4.2hereof.

 

“ThresholdAmount” shall have the meaning set forth in Section 6.2(a)(iii) hereof.

 

“Transaction”shall have the meaning set forth in preamble hereof.

 

“TreasuryRegulations” shall mean the final, temporary and proposed federal incometax regulations promulgated under the Code, as such Treasury Regulations may beamended from time to time.  Allreferences herein to specific sections of the Treasury Regulations shall bedeemed also to refer to any corresponding provisions of predecessor orsucceeding Treasury Regulations.

 

*[Remainder of page intentionallyleft blank.]*

 

Portions of this Exhibit were omitted and have been filedseparately with the Secretary of the Commission pursuant to the Registrant’sapplication requesting confidential treatment under Rule 24b-2 of theSecurities Exchange Act of 1934, as amended.

 

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INWITNESS WHEREOF, Taconic, CLS and Xenogen have caused this Agreement to besigned, all as of the date first written above.

 
|   | TACONIC  FARMS, INC.         |
|--------|-----------------------------------|
|   |                              |
|   |                              |
|   | By:                               | /s/ Todd F. Little |
|   |                              | Name:  Todd F. Little |
|   |                              | Title:  President and Chief Executive Officer |
|   |                              |
|   | CALIPER  LIFE SCIENCES, INC. |
|   |                              |
|   |                              |
|   | By:                               | /s/ E. Kevin Hrusovsky |
|   |                              | Name:  E. Kevin Hrusovsky |
|   |                              | Title:  President and Chief Executive Officer |
|   |                              |
|   | XENOGEN  CORPORATION              |
|   |                              |
|   |                              |
|   | By:                               | /s/ E. Kevin Hrusovsky |
|   |                              | Name:  E. Kevin Hrusovsky |
|   |                              | Title:  President and Chief Executive Officer |

 

Portions of this Exhibit were omitted and have been filed separatelywith the Secretary of the Commission pursuant to the Registrant’s applicationrequesting confidential treatment under Rule 24b-2 of the SecuritiesExchange Act of 1934, as amended.

 

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