Document:

QuickLinks
 -- Click here to rapidly navigate through this document

Exhibit 10.6  

 
 

VIASYS Healthcare Inc. Management Incentive Program    
    

        Since November 2001, when the spin-off of VIASYS Healthcare Inc. ("Company") from Thermo Electron Corporation was completed, the Company
has maintained an annual management incentive program (the "Program") for certain employees designated by the Company. Generally, employees eligible for designation by the Company must be regular,
exempt, full-time management and key contributors of the Company and its subsidiaries. 

        The
Program is available to employees who have commenced employment with the Company prior to the start of the fourth quarter in the relevant Program year. To the extent an employee is
not employed with the Company for a full year, an employee may be eligible for a pro-rated payment for a partial year of service based on his/her commencement date. In order to receive an
incentive payment under the Program, the employee must be continuing in the service of the Company, and must not have provided notice to the Company, on the date of payment. 

Program Outline  

        The Program is comprised of three performance measures: 

	•
	Company
performance is measured in earnings per share ("EPS");

	•
	Strategic
business unit ("SBU") performance is measured in budgeted operating income per individual business unit; and

	•
	Individual
performance is measured by achievement of approved objectives. 

        On
an annual basis, the Company establishes the EPS and SBU targets and approves the individual performance objectives for the Chief Executive Officer. The Chief Executive Officer
approves individual performance objectives for each of the executive officers, and the business units establish individual performance objectives for all other eligible employees. 

        Actual
incentive payouts are established on an annual basis and range from 0% at below minimum performance, 100% (or one times target bonus) at target performance and 200% (or two times
target bonus) at or above maximum performance. Each eligible employee is assigned a target bonus amount indicated as a percentage of his/her base salary and has the potential to earn this target bonus
if the prescribed Company, SBU and individual objectives are achieved. Target bonuses for employees in our corporate office are based only on achievement of Company and individual objectives. A
percentage of each individual's bonus eligibility is tied to the applicable factors described above and weighted based upon the relative importance of each of the performance factors to the
individual's job. 

        Unless
approved by the Company, if actual EPS during any Program year is below the minimum EPS goal established by the Company, no incentive payment is made to any employee even if
his/her SBU operating income and individual objectives are met. 

Incentive Payments  

        Annual incentive payments are typically paid before the close of the first calendar quarter following the end of the Program year. 

Oversight & Approval  

        The Compensation Committee of the Board of Directors is responsible for the review and oversight of the Program. 

        This
description of the Program is a summary of the Program as it has operated from the date of the spin-off. In any given year, the terms and conditions of the Program may
be amended as the Company deems appropriate in its discretion. 

2005 Target Bonuses for Named Executive Officers  

	Name
 
	 	Title
	 	Target Bonus as a % of Base Salary
	 
	Randy H. Thurman	 	Chairman, President & Chief Executive Officer	 	100	%
	Lori J. Cross	 	Group President, NeuroCare	 	50	%
	Martin P. Galvan	 	Senior Vice President, Chief Financial Officer, Director of Investor Relations	 	60	%
	Mahboob H. Raja	 	Group President, International	 	50	%
	Edward Pulwer	 	Executive Vice President and Group President, Respiratory Care	 	50	%

QuickLinks

VIASYS Healthcare Inc. Management Incentive ProgramQuickLinks
 -- Click here to rapidly navigate through this document
Exhibit 10.15  

DATED    March 15,
2005 

VIASYS Holdings Inc.  

and 

Those Persons whose names are set out in Schedule 5  

SHARE SALE AGREEMENT  

Morgan Lewis  

Morgan, Lewis & Bockius

2 Gresham Street

London

England EC2V 7PE

Tel. +44 (0) 20 7710 5500

Fax: +44 (0) 20 7710 5600 

  

 
 

TABLE OF CONTENTS    
    

	 
	 
	 	Page

	  1.	INTERPRETATION	 	3
	  2.	SALE AND PURCHASE	 	9
	  3.	CONSIDERATION AND ADJUSTMENTS	 	9
	  4.	COMPLETION	 	12
	  5.	SELLERS' WARRANTIES AND COVENANTS	 	14
	  6.	PURCHASER'S REMEDIES AND SELLERS' LIMITATIONS ON LIABILITY	 	15
	  7.	RESTRICTIONS ON SELLERS' BUSINESS ACTIVITIES	 	16
	  8.	INTELLECTUAL PROPERTY AND BUSINESS INFORMATION	 	16
	  9.	BOOKS AND RECORDS	 	17
	10.	EFFECT OF COMPLETION	 	17
	11.	JOINT AND SEVERAL LIABILITY	 	17
	12.	RELEASE OF SELLERS	 	17
	13.	REMEDIES AND WAIVERS	 	17
	14.	ASSIGNMENT	 	17
	15.	FURTHER ASSURANCE	 	17
	16.	ENTIRE AGREEMENT	 	18
	17.	NOTICES	 	18
	18.	ANNOUNCEMENTS	 	19
	19.	CONFIDENTIALITY	 	20
	20.	COSTS AND EXPENSES	 	20
	21.	COUNTERPARTS	 	20
	22.	INVALIDITY	 	20
	23.	CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999	 	21
	24.	CHOICE OF GOVERNING LAW AND JURISDICTION	 	21
	25.	AGENT FOR SERVICE	 	21
	SCHEDULE 1	 	23
	SCHEDULE 2	 	25
	SCHEDULE 3	 	46
	SCHEDULE 4	 	48
	SCHEDULE 5	 	57
	SCHEDULE 6	 	58
	SCHEDULE 7	 	59
	SCHEDULE 8	 	63
	SCHEDULE 9	 	64
	SCHEDULE 10	 	65
	SCHEDULE 11	 	66
	SCHEDULE 12	 	67
	SCHEDULE 13	 	68

i

   THIS AGREEMENT is made on March, 15 2005 

BETWEEN:  

	(i)
	The
persons whose names and addresses are set out in Schedule 5 (collectively the "Sellers" and individually a
"Seller") 

AND  

	(ii)
	VIASYS
Holdings Inc., a corporation organised under the laws of the state of Delaware, USA (the "Purchaser"). 

WHEREAS:  

	(A)
	The
Purchaser intends to purchase all of the Shares (as defined in this agreement) in the Company (as defined in this agreement) from the Sellers and the Company owns the entire
issued share capital of each of its Subsidiaries (as defined in this agreement).

	(B)
	Particulars
of the Company and each of its Subsidiaries and associated companies are set out in Schedule 6 and Schedule 7, respectively.

	(C)
	The
Sellers have agreed to sell and the Purchaser has agreed to purchase the Shares in each case on the terms and subject to the conditions of this agreement. 

2

 

NOW
IT IS HEREBY AGREED as follows: 

1.     INTERPRETATION  

	1.1
	in
this agreement and the Schedules to it: 

	 	 	"Accounts"	 	means the audited financial statements of the Company and of each Subsidiary, prepared in accordance with the Companies Acts or other applicable law, for the accounting reference period ended on the Accounts Date each of
which financial statements comprises a balance sheet, profit and loss account, notes, auditors' and directors' reports.
	

 	
 	
"Accounts Date"	
 	

means 31 December 2004;
	

 	
 	
"Bad Leaver"	
 	

means in respect of a Seller who is a Leaver, where the cessation of employment occurs for any reason whatsoever other than if the relevant Seller: (i) ceases to be employed as a result of his death; (ii) is dismissed by reason either or redundancy
or of his being absent from work due to ill health resulting in permanent incapacity (save where such ill health arises as a result of an abuse of drink or drugs); or (iii) ceases to be employed following the termination by the Company in
circumstances that would not justify summary or fair dismissal at law.
	

 	
 	
"Books and Records"	
 	

has its common law meaning and includes, without limitation, all notices, correspondence, orders, inquiries, drawings, plans, books of account and other documents and all computer disks or tapes or other machine legible programs or other
records;
	

 	
 	
"Budget"	
 	

means the budget for the Group for the current financial year most recently approved by the board of directors of the Company;
	

 	
 	
"Business Day"	
 	

means a day (other than a Saturday or a Sunday) on which clearing banks are open for business in London and in New York;
	

 	
 	
"Business Information"	
 	

means all information, know-how and records (whether or not confidential and in whatever form held) including (without limitation) all formulas, designs, specifications, drawings, data, manuals and instructions and all customer lists, sales
information, business plans and forecasts, and all technical or other expertise and all computer software and all accounting and tax records, correspondence, orders and inquiries;
	

 	
 	
"Cash"	
 	

means the cash in hand or at bank of the Group as shown in the Completion Accounts, determined in accordance with UK GAAP;
	

 	
 	
"Companies Acts"	
 	

means the Companies Act 1985, the Companies Consolidation (Consequential Provisions) Act 1985, the Companies Act 1989 and Part V of the Criminal Justice Act 1993, in each case as amended from time to time;
	

 	
 	
"Company"	
 	

means Micro Medical Limited, basic information concerning which is set out in Schedule 6;
	

 	
 	
"Completion Accounts"	
 	

means the financial statements to be prepared in accordance with clause 3 and Schedule 9;
	 	 	 	 	 

3

 

	

 	
 	
"Completion Date"	
 	

means the date of execution of this Agreement, or such other date as the parties may agree in writing;
	

 	
 	
"Completion"	
 	

means completion of the sale and purchase of the Shares under this agreement;
	

 	
 	
"Confidential Business Information"	
 	

means Business Information which is confidential or not generally known;
	

 	
 	
"Covenantors"	
 	

means the covenantors named in the Tax Covenant;
	

 	
 	
"Deferred Consideration"	
 	

has the meaning given in clause 3.17;
	

 	
 	
"Disclosure Letter"	
 	

means the letter dated of even date herewith written by the Sellers to the Purchaser for the purposes of clause 6.3 and delivered to the Purchaser at Completion together with the bundle of disclosed documents attached to it;
	

 	
 	
"Dollar or "$"	
 	

means the legal tender and currency of the United States;
	

 	
 	
"Event"	
 	

shall have the meaning given in the Tax Covenant;
	

 	
 	
"German Net Asset Value"	
 	

means the value of the net assets of Micro Medical Germany as at the Completion Date as shown in the Completion Accounts, which shall be the total amount of the assets of Micro Medical Germany less the total amount of the liabilities of Micro Medical
Germany determined in accordance with German accounting principles;
	

 	
 	
"Group"	
 	

means the Company and all the Subsidiaries and "member of the Group" shall be construed accordingly;
	

 	
 	
"Indebtedness"	
 	

means the aggregate indebtedness of the Group (other than ordinary course indebtedness in respect of trade creditors) for (a) borrowed money; (b) capitalized lease obligations; (c) obligations under interest rate agreements, currency arrangements,
loan agreements, debentures, acceptance credit facilities, bills of exchange, promissory notes, debt or inventory financing, discounting or factoring agreements or sale and leaseback arrangements; (d) guarantees of any obligation of any third person;
(e) performance bonds or indemnities; or (f) letters of credit, in each case determined in accordance with UK GAAP;
	

 	
 	
"Information Technology"	
 	

means computer hardware, software, networks and/or other information technology and any aspect or asset of a business including any product manufactured or otherwise created by such business which relies on computer hardware, software, networks
and/or other information technology (whether embedded or otherwise);
	

 	
 	
"Intellectual Property"	
 	

means patents, trade marks and service marks (including rights in trade get-up or trade dress), rights in designs, trade or business names, copyrights, domain names, topography rights, domain names and rights in databases (whether or not any of these
is registered and including applications for registration of any such thing) and all rights or forms of protection of a similar nature or having equivalent or similar effect to any of these which may subsist anywhere in the world together with all
renewals, extensions and revivals thereof;
	 	 	 	 	 

4

 

	

 	
 	
"IP Employment Amendment Agreement"	
 	

means the agreement amending the terms of employment of employees of the Company with respect to Intellectual Property in the form set out in Schedule 12;
	

 	
 	
"Key Personnel"	
 	

means Christopher Patrick Lawson and Daniel Quirke (who are both employees of the Company) and Philip Chowienczyk (who is a consultant to the Company);
	

 	
 	
"Leaver"	
 	

means any Seller who is employed by the Company and ceases to be an employee of the Company after Completion. In this definition and the definition of "Bad Leaver" any reference to the date of cessation of employment (or similar) shall be the date
upon which the relevant person gives or is given notice of termination of his employment, or if later, the date he is otherwise no longer required to perform his duties under his service contract.
	

 	
 	
"Management Accounts"	
 	

means the management accounts of each member of the Group for each complete month since the Accounts Date;
	

 	
 	
"MicroDirect Distributor Agreement"	
 	

means the agreement between the Company and MicroDirect Inc, in the form set out in Schedule 13;
	

 	
 	
"Micro Medical Germany"	
 	

means Micro Medical Deutschland GmbH, a company organised under the law of Germany and whose details are set out in Schedule 7;
	

 	
 	
"Net Asset Value"	
 	

means the value of the assets of the Group as at the Completion Date as shown in the Completion Accounts, which shall be the total aggregate amount of the assets of the Group less the total aggregate amount of the liabilities of the Group determined
in accordance with UK GAAP;
	

 	
 	
"Proceedings"	
 	

means any proceeding, suit or action arising out of or in connection with this agreement;
	

 	
 	
"Property Owner"	
 	

means, in relation to any Relevant Property, the person referred to as owner in Schedule 8;
	

 	
 	
"Property" or "Properties"	
 	

means freehold, leasehold or other immovable property in any part of the world;
	

 	
 	
"Proprietary Software"	
 	

means software in which any member of the Group owns any Intellectual Property;
	

 	
 	
"Pulse Trace Product Line"	
 	

means (i) all equipment that performs pulse contour analysis on the arterial pulse derived by photoplethysmography or tonometry, developed or currently in development by the Company; and/or (ii) instruments used to measure pulse wave
velocity (the velocity of the arterial pulse wave in the aorta) developed or currently in development by the Company and/or (iii) other photoplethysmography devices diagnosing patent foramen ovale developed or currently in development by the
Company, and/or (iv) any product developed by the Company after Completion that is a modified or improved version of, or is otherwise substantially based in, any such product;
	 	 	 	 	 

5

 

	

 	
 	
"Purchaser's Group"	
 	

means the Purchaser, its subsidiaries and subsidiary undertakings, any holding company of the Purchaser and all other subsidiaries of any such holding company from time to time;
	

 	
 	
"Purchaser's Solicitors"	
 	

means Morgan, Lewis & Bockius of 2 Gresham Street, London EC2V 7PE;
	

 	
 	
"Relevant Portion"	
 	

means (i) in the case of each of Philip Jan Chowienczyk, Daniel Quirke and Christopher Patrick Lawson an aggregate amount of $27,628,330 being the aggregate of the Consideration set opposite their names in Schedule 5; and (ii) in the
case of each of Anne Margaret Lawson, Jacqueline Elaine Linda Quirke and Daniel Quirke and Jacqueline Elaine Linda Quirke as Trustees of the Daniel Quirke Childrens Settlement No.1, the amount of Consideration set out opposite their respective names
in Schedule 5.
	

 	
 	
"Relevant Property"	
 	

means the Property or Properties referred to in Schedule 8;
	

 	
 	
"Relief"	
 	

shall have the meaning given in the Tax Covenant;
	

 	
 	
"Restricted Area"	
 	

means any territory in the world, in which any member of the Group conducts its business;
	

 	
 	
"Retained Consideration"	
 	

shall have the meaning given in clause 4.7.2;
	

 	
 	
"Saving"	
 	

means the reduction or elimination of any liability of the Group to make an actual payment of corporation tax in respect of which the Sellers would not have been liable under the Tax Covenant, by the use of any Relief arising wholly as a result of a
Warranty claim or a liability of the Sellers under the Tax Covenant in respect of which the Sellers have made a payment to the Purchaser;
	

 	
 	
"Seller's Solicitors"	
 	

means Cripps Harries Hall of Wallside House, 12 Mount Ephraim Road, Tunbridge Wells, Kent TN1 1EG;
	

 	
 	
"Shares"	
 	

means all the issued shares in the capital of the Company;
	

 	
 	
"Subsidiary"	
 	

means the subsidiary companies of the Company, basic information concerning which being set out in Schedule 7;
	

 	
 	
"Tax Authority"	
 	

means any Taxing or other Authority (whether within or outside the United Kingdom) competent to impose any Tax liability;
	

 	
 	
"Tax Covenant"	
 	

means the tax covenant set out in Schedule 4;
	

 	
 	
"Tax" or "Taxation"	
 	

shall have the meaning given in the Tax Covenant;
	

 	
 	
"Taxes Act"	
 	

means the Income and Corporation Taxes Act 1988;
	

 	
 	
"TGCA"	
 	

means the Taxation of Chargeable Gains Act 1992;
	

 	
 	
"VAT Legislation"	
 	

means any relevant enactments in relation to VAT and all notices, provisions and conditions made or issued thereunder including the terms of any agreement reached with any relevant Tax Authority, and any concession referred to in the Disclosure
Letter;
	 	 	 	 	 

6

 

	

 	
 	
"VAT"	
 	

means value added tax or any similar sales or turnover tax of any relevant jurisdiction;
	

 	
 	
"Warranties"	
 	

means the representations and warranties set out in Schedule[2 given by the Sellers and any other representations or warranties made by or on behalf of the Sellers or any of them in this agreement or which have become terms of this agreement and
"Warranty" shall be construed accordingly; and
	

 	
 	
"Working Hours"	
 	

means 9.30 a.m. to 5.30 p.m. on a Business Day.

7

  

	1.2
	In
this agreement, unless otherwise specified:

	1.2.1
	references
to clauses, paragraphs and Schedules are to clauses, paragraphs of, and Schedules to, this agreement;

	1.2.2
	a
reference to any statute or statutory provision shall be construed as a reference to the same as it may have been, or may from time to time be, amended, modified or
re-enacted and any reference to law shall mean (where applicable) any relevant law of any jurisdiction in the world and shall be deemed to include analagous statutory provisions where the
same shall apply in this agreement, of any jurisdiction in the world;

	1.2.3
	references
to a "company" shall be construed so as to include any company, corporation or other body corporate, wherever and however incorporated or established;

	1.2.4
	references
to a "person" shall be construed so as to include any individual, firm, company, government, state or agency of a state or any joint venture, association, trust or
partnership (whether or not having separate legal personality);

	1.2.5
	references
to "indemnify" and "indemnifying" any person against any circumstance include indemnifying and keeping him harmless from all actions, claims and proceedings from time to
time made against that person and all loss or damage and all payments, costs or expenses made or incurred by that person as a consequence of or which would not have arisen but for that circumstance;

	1.2.6
	the
expressions "accounting reference date", "accounting reference period", "allotment", "body corporate", "current assets", "debentures", "holding company", "paid up", "profit and
loss account", "subsidiary", "subsidiary undertaking" and "wholly-owned subsidiary" shall have the meaning given in the Companies Acts;

	1.2.7
	a
person shall be deemed to be connected with another if that person is connected with another within the meaning of section 839 of the Taxes Act;

	1.2.8
	references
to writing shall include any modes of reproducing words in a legible and non-transitory form;

	1.2.9
	references
to times of the day are to London time;

	1.2.10
	headings
to clauses and Schedules are for convenience only and do not affect the interpretation of this agreement;

	1.2.11
	references
to the plural shall include the single and vice versa unless the terms of the relevant provision provide otherwise;

	1.2.12
	the
Schedules and any attachments form part of this agreement and shall have the same force and effect as if expressly set out in the body of this agreement, and any reference to
this agreement shall include the Schedules;

	1.2.13
	references
to the knowledge, information, belief or awareness of any person shall be treated as including any knowledge, information, belief or awareness which the person would
have if the person made all usual and reasonable enquiries;

	1.2.14
	any
references to "agreements", "contracts" or "arrangements" shall include written and oral agreements, contracts and arrangements;

	1.2.15
	other
terms, definitions or phrases may be defined within the body of this agreement (and not only in clause 1.1 hereof) and such definitions shall, unless otherwise stated,
take full effect throughout the entire agreement; 

8

 

	1.2.16
	to
the extent that any sum or amount of money set out or otherwise described in this agreement or which arises in relation to or in connection with any transaction contemplated by
this agreement, expressed to be in either pounds sterling or Dollars, is required in any circumstance to be converted into any other currency, including pounds sterling or Dollars, then such sum or
amount shall be converted into the required currency at the then prevailing exchange rate between the respective currencies according to Barclays Bank plc as at close of business on the day on which
conversion takes place and, to the extent that such conversion takes place on a day other than a Business Day, then as at close of business on the next successive Business Day. 

2.     SALE AND PURCHASE  

	2.1
	Each
of the Sellers shall sell or procure the sale (with full title guarantee) of, and the Purchaser shall purchase, those Shares set opposite each Seller's name in Schedule 5
with all rights attached or accruing to them at Completion.

	2.2
	The
Purchaser shall be entitled to exercise all rights attached or accruing to the Shares including, without limitation, the right to receive all dividends, distributions or any
return of capital declared, paid or made by the Company on or after Completion.

	2.3
	Each
of the Sellers waives all rights of pre-emption over (and any associated right to require any other party to acquire) any of the Shares conferred upon him by the
articles of association of the Company or in any other way and undertakes to take all steps necessary to ensure that any rights of pre-emption over (and any associated right to require any
other party to acquire) any of the Shares are waived. 

3.     CONSIDERATION AND ADJUSTMENTS  

	3.1
	Subject
to the adjustments set out in clauses 3.10 to 3.14, the total consideration for the sale of the Shares shall be the sum of $39,065,000 (the
"Consideration") payable in accordance with clause 4.7.

	3.2
	As
soon as practicable after Completion, and in any event within 100 days of Completion, the Purchaser shall prepare and deliver to the Sellers the draft Completion Accounts
stating the Net Asset Value, the German Net Asset Value, the Cash and Indebtedness. The Completion Accounts shall be prepared in accordance with the provisions of Schedule 9 and otherwise upon
the same accounting principles and bases as were applied in the preparation of the Accounts, and such principles and bases shall be altered in the Completion Accounts only to the extent they are not
in accordance with UK GAAP.

	3.3
	The
Sellers shall review the Completion Accounts and, within 30 days of receipt, confirm to the Purchaser whether or not they agree with the draft Completion Accounts, giving
written details of any matters in dispute.

	3.4
	If
the Sellers confirm their agreement with the draft Completion Accounts (either as presented to them or as modified in such manner as they and the Purchaser shall agree) the Sellers
shall notify this to the Purchaser in writing and they shall constitute the Completion Accounts for the purposes of this agreement and be final and binding on the parties to this agreement.

	3.5
	If
the Sellers are unable to agree with part or all of the draft Completion Accounts, within a further 10 days of the date the Sellers shall notify the Purchaser in accordance
with clause 3.3 that the Sellers dispute the draft Completion Accounts then any matter in dispute shall be referred to Independent Accountants (acting as experts and not as arbitrators).
"Independent Accountants", for those purposes, means an independent firm of chartered accountants 

9

 

appointed
by the Sellers and the Purchaser jointly or, in default of agreement as to such appointment within five Business Days of one of them notifying the other of its wish to appoint an independent
firm, by the President from time to time of the Institute of Chartered Accountants in England and Wales on the application of either of them. 

	3.6
	The
Independent Accountants shall make and communicate their decision to the Sellers and the Purchaser within 15 Business Days of appointment and it shall be final and binding on the
parties to this agreement (in the absence of manifest error).

	3.7
	Following
settlement of any such matter which the Sellers shall have disputed, the Completion Accounts shall be finalised in accordance with that settlement and shall constitute the
Completion Accounts for the purposes of this agreement and shall be final and binding on the parties to this agreement.

	3.8
	The
Sellers and the Purchaser shall each give the other (and their respective accountants from time to time) or the Independent Accountants, as the case may be, full access to those
books of account, documents, files and papers which the requesting party may reasonably require to prepare or review the Completion Accounts and determine whether the Completion Accounts have been
prepared in accordance with this clause and to their employees who shall be instructed to give promptly all the information and explanations as the requesting party or firm may reasonably require for
the same purposes.

	3.9
	The
Sellers shall be responsible for the fees of their accountants and the Purchaser shall be responsible for those of its accountants. The fees of the Independent Accountants shall
be shared equally by the Purchaser and the Sellers unless the Independent Accountants shall determine otherwise.

	3.10
	If
the Net Asset Value (excluding therefrom any Cash, the German Net Asset Value and the items listed on "The Micro Medical Net Asset Target Schedule" attached as Annex 3) is
less than $3,393,005, the Sellers shall, forthwith on receipt of a written demand by the Purchaser and, in any event, no later than 5 Business Days after the receipt of such demand, pay to the
Purchaser an amount equal to the shortfall and such payment shall be treated as a reduction in the consideration payable for the Shares.

	3.11
	If
the Net Asset Value (excluding therefrom any Cash, the German Net Asset Value and the items listed on "The Micro Medical Net Asset Target Schedule" attached as Annex 3) is
greater than $3,393,005, then (i) the Purchaser shall, forthwith on receipt of a written demand by the Sellers and, in any event, no later than 5 Business Days after the receipt of such demand,
pay to the Sellers an amount equal to the shortfall up to a maximum of $200,000 and such payment shall be treated as additional consideration payable for the Shares, and (ii) any such excess
greater than $200,000 shall be applied in accordance with Clause 3.12.

	3.12
	If
the German Net Asset Value is less than a net liability of $1,553,400, then (i) to the extent Net Asset Value (excluding therefrom any Cash, the German Net Asset Value and
the items listed on "The Micro Medical Net Asset Target Schedule" attached as Annex 3) exceeds $3,393,005 by more than $200,000, such excess shall be set off against such shortfall, and
(ii) to the extent there remains a shortfall in the German Net Asset Value after such excess Net Asset Value (excluding therefrom any Cash, the German Net Asset Value and the items listed on
"The Micro Medical Net Asset Target Schedule" attached as Annex 3) has been set off against it, then the Sellers shall, forthwith on receipt of a written demand by the Purchasers and, in any
event, no later than 5 Business Days after the receipt of such demand, pay to the Purchaser an amount equal to such remaining shortfall.

	3.13
	If
the Cash is less than $2,440,000 the Sellers shall, forthwith on receipt of a written demand by the Purchaser and, in any event, no later than 5 Business Days after the receipt of
such 

10

 

demand,
pay to the Purchaser an amount equal to the shortfall and such payment shall be treated as a reduction in the consideration payable for the Shares. 

	3.14
	If
the Indebtedness is greater than $3,780,000 the Sellers shall, forthwith on receipt of a written demand by the Purchaser and, in any event, no later than 5 Business Days after the
receipt of such demand, pay to the Purchaser an amount equal to the excess and such payment shall be treated as a reduction in the consideration payable for the Shares.

	3.15
	Subject
to the provisions of Clause 3.16, to the extent that sales by any member of the Purchaser's Group (which for the avoidance of doubt shall include sales by any member
of the Group) of the Pulse Trace Product Line exceed $3,000,000 (the "Milestone") during the period commencing on 1 January 2005 and ending on 31
December 2009 (the "Sales Period") then the Purchaser shall pay to the Sellers, in accordance with clauses 3.16 and 3.17, a sum equal to 5% (the
"Contingent Consideration Figure") of the cumulative Net Sales of the Pulse Trace Product Line in excess of the Milestone (the
"Contingent Consideration").

	3.16
	In
the event that both of Daniel Quirke and Christopher Lawson shall not have become Bad Leavers on or prior to 31st December 2007, the Contingent Consideration Figure
referred to in Clause 3.15 shall be increased to 7%; provided that with respect to Daniel Quirke and Christopher Lawson only and on an individual
basis (and not in respect of the other Sellers who shall be entitled to receive the Contingent Consideration subject to the terms of Clause 3.15 and this Clause 3.16), if either of them
is a Bad Leaver (i) on or prior to 31st December 2007, he shall receive Contingent Consideration using a Contingent Consideration Figure of 5% and only in respect of the period to 31st
December 2007, or (ii) after 31st December 2007, he shall receive Contingent Consideration using a Contingent Consideration Figure of 5% in respect of the period to 31st
December 2007 plus Contingent Consideration using a Contingent Consideration Figure of 7% for each full financial year during which he shall have been employed by the Group after 31st
December 2007 through 31st December 2009 and before becoming a Bad Leaver (and for the avoidance of doubt he shall receive no Contingent Consideration in respect of any partial financial
year during which he shall have been employed by the Group prior to becoming a Bad Leaver).

	3.17
	The
Purchaser shall within 60 days of the end of each financial year of the Purchaser's Group within the Sales Period referred to in clause 3.15: (i) provide to
the Sellers a schedule showing the number of units and unit price of items in the Pulse Trace Product Line sold by the Purchaser's Group during such financial year and the amount of such Contingent
Consideration accruing in such financial year, and (ii) pay such amount of Contingent Consideration to the Sellers (provided that if 31 December 2009 is not the end of a financial year
of the Purchaser's Group, then such schedule shall be provided for the period from the end of the last financial year to 31 December 2009 and the amount of the Contingent Consideration due for
the period to 31 December 2009). For the avoidance of doubt, if the Milestone is not achieved during the Sales Period, no additional payments of the Contingent Consideration shall become
payable at all. To the extent that during the Sales Period, the Pulse Trace Product Line or any product within the Pulse Trace Product Line is merged with or otherwise combined with any other product
of the Purchaser's Group, including the Group or any member of the Group (the "Merged Product Line"), then, for the purposes of calculating the
Contingent Consideration, the Purchaser and the Sellers shall only take account of the Net Sales of the Merged Product Line which relate solely to the Net Sales of the Pulse Trace Product Line or any
product within the Pulse Trace Product Line which form part of the Merged Product Line (with prices, used for the calculation of Net Sales, based on the then prevailing list price of the relevant
Pulse Trace product and the other product(s) which, combined, produce the Merged Product Line). For the purposes of this clause, "Net Sales" means
sales, net of commission, discounts, rejections and returns. 

11

 

	3.18
	On
the date that is no more than sixty days following 31 December 2007 (the "Deferred Consideration Payment Date") the Sellers
shall be entitled to be paid the sum of $2,000,000 (the "Deferred Consideration"), which sum shall be payable at the sole discretion of the Purchaser
either in cash or in publicly traded stock or securities of Viasys Healthcare Inc. or any successor thereto provided that:

	3.18.1
	the
Operating Income (as calculated as set out in Annex 1) and Revenue targets with respect to the business of the Group (as constituted at the date of this Agreement) set
out in Annex 1 of this agreement shall have been achieved in either (i) each financial year or period or (ii) on a cumulative basis across all years and periods taken as a whole; and

	3.18.2
	with
respect to the individual entitlements to such Deferred Consideration of Daniel Quirke and Christopher Lawson only, as determined in accordance with clause 3.18, each
of them shall forfeit his individual entitlement to such Deferred Consideration if he shall have prior to 31st December 2007 been a Leaver in circumstances in which he is a Bad Leaver.

	3.19
	The
proportion of the Consideration (as adjusted by clauses 3.10 to 3.13) and the Deferred Consideration and the Contingent Consideration to which each Seller is entitled shall be
that which the number of Shares set opposite his name in Schedule 5 bears to the total number of Shares. 

4.     COMPLETION  

	4.1
	Completion
shall take place immediately after signature of this agreement on the Completion Date at the offices of the Company.

	4.2
	At
Completion the Sellers shall do those things listed in Schedule 1.

	4.3
	The
Purchaser shall not be obliged to complete this agreement unless each Seller complies fully with the requirements of clause 4.2 and Schedule 1 so far as they relate
to the Seller in question.

	4.4
	The
Purchaser shall not be obliged to complete the sale and purchase of any of the Shares unless the sale and purchase of all the Shares is completed simultaneously.

	4.5
	If
the obligations of the Sellers under clause 4.2 and Schedule 1 are not complied with on the Completion Date the Purchaser may:

	4.5.1
	defer
Completion (so that the provisions of this clause shall apply to Completion as so deferred); or

	4.5.2
	proceed
to Completion as far as practicable (without limiting its rights under this agreement); or

	4.5.3
	terminate
this agreement by notice in writing to the Sellers.

	4.6
	If
the agreement is terminated in accordance with clause 4.5 (and without limiting the Purchaser's right to claim damages) all obligations of the Purchaser under this agreement
shall end except for those expressly stated to continue without limit in time but (for the avoidance of doubt) all rights and liabilities of parties which have accrued before termination shall
continue to exist.

	4.7
	The
Consideration shall be paid to the Sellers as follows:

	4.7.1
	90%
of the initial Consideration, as set out in Dollars in clause 3.1 (being the sum $35,158,500) shall be paid to the Sellers at Completion in the proportions set out 

12

 

opposite
their names in Schedule 5 once the Sellers have complied with their obligations under clause 4.2 and Schedule 1 and shall be paid by way of wire transfer to the following
accounts at UBS, 1 Curzon Street, London, set out in Annex 2 hereto. 

	4.7.2
	the
remaining 10% of the initial Consideration as set out in Dollars shall be deposited with the Escrow Agent (as defined below in clause 4.8) for the period ending on the
date 2 years and 5 days after Completion, and shall be payable in accordance with clause 4.8 and clause 6.2 (the "Retained
Consideration"); and

	4.7.3
	to
the extent that the Consideration is adjusted pursuant to clauses 3.10, 3.11 and/or 3.12, any such sum which becomes payable as a result of the operation of an adjustment shall
be paid to the party which is owed such sum, but the other party by way of a wire transfer. 

	

	For
the avoidance of doubt, the Contingent Consideration (if any) shall be paid in accordance with clause 3.17 and the Deferred Consideration shall be paid in
accordance with clause 3.18.

	4.8
	The
Retained Consideration shall be placed in an account with LaSalle Bank/ABN Amro ("the Escrow Agent") and shall be held by the
Escrow Agent upon the terms and subject to the conditions set out in the Escrow Agreement, the form of which is set out in Schedule 11 hereto. Upon Completion the Retained Consideration shall
be delivered to the Escrow Agent by the Purchaser and the Purchaser, the Sellers and the Escrow Agent shall execute the Escrow Agreement. The Sellers (in aggregate) shall pay half of any fee or costs
assessed by the Escrow Agent and the Purchaser shall pay the remaining half.

	4.9
	The
Tax Covenant shall come into full force and effect at Completion. 

13

  

	4.10
	The
Sellers shall procure that each one of the Key Personnel enters into a contract of employment or a consultancy agreement (as applicable) with the Company on Completion in the
agreed forms as set out in Schedule 11. 

5.     SELLERS' WARRANTIES AND COVENANTS  

	5.1
	The
Sellers represent and warrant, in accordance with clause 5.2, to the Purchaser in the terms set out in Schedule 2. 

	 	 	5.2	 	 	 
	 	 	 	 	5.2.1	Each of Philip Jan Chowienczyk, Christopher Patrick Lawson and Daniel Quirke represent and warrant, jointly and severally, to the Purchaser in the terms set out in Schedule 2; and
	

 	
 	

 	
 	

5.2.2	

Each of Ann Margaret Lawson, Jacqueline Elaine Linda Quirke and Daniel Quirke and Jacqueline Elaine Linda Quirke (joint holders, as Trustees of the Daniel Quirke Children's Settlement No. 1) represent and warrant, severally only, to the
Purchaser in the terms set out in Schedule 2.

	5.3
	The
Sellers accept that the Purchaser is entering into this agreement in reliance upon representations in the terms of the Warranties made by the Sellers with the intention of
inducing the Purchaser to enter into this agreement.

	5.4
	The
Sellers undertake to disclose in writing to the Purchaser anything which is or may constitute a breach of or be inconsistent with any of the Warranties immediately once it comes
to the notice of any of them before, at the time of and after Completion.

	5.5
	The
Sellers undertake (if any claim is made against any of them in connection with the sale of the Shares to the Purchaser) not to make any claim against the Company or any member of
the Group or any director, employee or adviser of the Company or any member of the Group on whom any of them may have relied before agreeing to any terms of this agreement or of the Tax Covenant or
authorising any statement in the Disclosure Letter, but so that this shall not preclude any Seller from claiming against any other Seller under any right of contribution or indemnity to which he may
be entitled.

	5.6
	Each
of the Warranties shall be construed as a separate and independent warranty and (except where expressly provided to the contrary) shall not be limited or restricted by reference
to or inference from the terms of any other Warranty or any other term of this agreement.

	5.7
	If
in respect of or in connection with any breach of any of the Warranties or any facts or matters warranted not being true or being misleading, any amount payable to the Purchaser by
the Sellers:-

	5.7.1
	is
subject to Taxation, such additional amounts shall be paid to the Purchaser by the Sellers so as to ensure that the net amount received by the Purchaser is equal to the full
amount payable to the Purchaser under this agreement; or

	5.7.2
	results
in a Saving (as determined by the auditors of the Group for the time being at the expense of the Sellers), the Purchaser shall repay to the Sellers the lesser of
(i) the amount of the Saving less any costs incurred by the Group or the Purchaser, and (ii) the amount paid by the Sellers in respect of the claim for breach of Warranty that gave rise
to the Saving.

	5.8
	The
Sellers undertake to indemnify and keep indemnified the Purchaser against all costs, expenses or other liabilities which the Purchaser may reasonably incur either before or after
the commencement of any action in connection with:

	5.8.1
	the
settlement of any claim that any of the Warranties are untrue or misleading or have been breached; 

14

 

	5.8.2
	any
legal proceedings in which the Purchaser claims that any of the Warranties are untrue or misleading or have been breached and to the extent to which judgment is given for the
Purchaser; or

	5.8.3
	the
enforcement of any such settlement or judgment.

	5.9
	In
relation to the properties at Unit 16/1, Old Brewery Yard, Kilton Road, Worksop and 94/13-17 Innovation Building, Sittingbourne Research
Centre, Sittingbourne, Kent the Sellers shall: (i) indemnify and hold harmless the Purchaser with respect to any loss resulting from, relating to or arising out of a breach by the Company of
clause 8.3.1 of the Sittingbourne Tenancy Agreement or the user clause of the Worksop Tenancy Agreement; and (ii) on being reasonably required to do so by the Purchaser at any time
within 3 months from the date of Completion, do or procure the doing of all such acts as the Purchaser may reasonably consider necessary and which are reasonable to expect the Sellers to do for
the transfer of the Worksop Tenancy Agreement to the Company or the granting of a new tenancy agreement from the landlord to the Company. 

6.     PURCHASER'S REMEDIES AND SELLERS' LIMITATIONS ON LIABILITY  

	6.1
	Subject
to clause 6.3 and to the limitations set out in Schedule 3, the Purchaser shall be entitled to claim after Completion that any of the Warranties has or had been
breached or is or was misleading and, without limitation, to claim under any covenant even if the Purchaser could have discovered on or before Completion that the Warranty in question had been
breached or was misleading.

	6.2
	Subject
to clause 6.3 and the limitations set out in Schedule 3, all claims made pursuant to any provision of this agreement by the Purchaser against any Sellers for a
breach of a Warranty (or otherwise), including, without limitation, any payments to be made pursuant to clause 5.8, shall be satisfied in the following order: 
	6.2.1
	firstly,
all claims shall be paid out of the Retained Consideration; and

	6.2.2
	secondly,
to the extent that the Retained Consideration has been exhausted or claims have been made against the Retained Consideration which total, in aggregate, the amount of the
Retained Consideration, all claims shall be settled and paid for by the Sellers. 

	

	To
the extent that any or all of the Retained Consideration remains in existence on the date which is 2 years and 5 days after Completion, then such
remaining Retained Consideration shall be paid to the Sellers in accordance with and subject to the terms and conditions of the Escrow Agreement.

	6.3
	The
Purchaser shall not be entitled to claim that any fact causes any of the Warranties to be breached or renders any Warranty misleading if it has been fully, fairly and specifically
disclosed to the Purchaser in the Disclosure Letter in the absence of any fraud or wilful deceit on the part of any of the Sellers or their agents or advisers.

	6.4
	If,
following Completion, the Purchaser becomes aware that there has been any material breach of the Warranties or any other term of this agreement the Purchaser shall not be entitled
to terminate this agreement but shall be entitled to claim damages or exercise any other right, power or remedy under this agreement or as otherwise provided by law.

	6.5
	The
parties acknowledge that the restrictions contained in clause 18 and clause 19 shall continue to apply after the termination of this agreement or the completion of
the sale and purchase of the Shares under this agreement without limit in time. 

15

 

7.     RESTRICTIONS ON SELLERS' BUSINESS ACTIVITIES  

	7.1
	Each
Seller undertakes that he or she will not, either alone or in conjunction with or on behalf of any other person, do any of the following things:

	7.1.1
	within
three years of Completion, be engaged or (except as the holder of shares in a listed company which confer not more than one per cent. of the votes which could normally be
cast at a general meeting of the company) directly or indirectly interested in carrying on a business in the Restricted Area which competes with the business of any member of the Group as it is
carried on at the date of Completion;

	7.1.2
	disclose
to any other person or (in any way which may be detrimental to the business of any member of the Group as carried on at the Completion Date) use any information which is
Confidential Business Information for so long as that information remains Confidential Business Information;

	7.1.3
	without
limitation to the provisions of this clause, in relation to a business which is competitive or likely to be competitive with the business of any member of the Group as
carried on at the Completion Date, use any trade or business name or distinctive mark, style or logo used by or in the business of any member of the Group at any time during the two years before
Completion or anything intended or likely to be confused with it;

	7.1.4
	within
three years of Completion, solicit in the Restricted Area any customer, in relation to goods or services sold to any person by any member of the Group in the course of its
business during the two years before the Completion Date, of that person in respect of similar goods or services;

	7.1.5
	within
three years of Completion, solicit in the Restricted Area or entice away from the employment of any member of the Group any person at present an employee of the Company any
member of the Group; nor

	7.1.6
	assist
any other person to do any of the foregoing things.

	7.2
	Each
of the Sellers expressly acknowledges that each of the undertakings contained in this clause is necessary to protect and maintain the proprietary interests and other legitimate
business interests of the Purchaser and that such undertakings are reasonable in their entirety.

	7.3
	Each
undertaking contained in this clause shall be construed as a separate undertaking and if one or more of the undertakings is held to be against the public interest or unlawful or
in any way an unreasonable restraint of trade, the remaining undertakings shall continue to bind the Sellers. 

8.     INTELLECTUAL PROPERTY AND BUSINESS INFORMATION  

	8.1
	In
the event the Purchaser discovers that any Seller owns any Intellectual Property or Business Information which has in the three years prior to Completion been used by the Group or
any member of the Group, such Seller agrees to transfer or procure the transfer of such Intellectual Property and/or Business Information to the Purchaser or a company nominated by the Purchaser for
nominal consideration.

	8.2
	The
Sellers, with effect from Completion, hereby procures the grant to the Purchaser of an exclusive, perpetual, worldwide, assignable, royalty-free licence (with the
right to sub-licence) to use any Intellectual Property or Business Information proprietary to any Seller which has been used (but not exclusively used) in the three years prior to
Completion by the Group. 

16

 

9.     BOOKS AND RECORDS  

	

	The
Sellers shall at Completion deliver to the Purchaser originals of all the Books and Records proprietary to the Sellers which relate to the business carried on by the
Group as at Completion. 

10.   EFFECT OF COMPLETION  

	

	Any
provision of this agreement and any other documents referred to in it which is capable of being performed after but which has not been performed at or before
Completion and all Warranties and covenants and other undertakings contained in or entered into pursuant to this agreement shall remain in full force and effect notwithstanding Completion. 

11.   JOINT AND SEVERAL LIABILITY  

	11.1
	Save
as otherwise specified herein, the obligations of the Sellers to perform in accordance with this agreement are joint and several.

	11.2
	If
any liability of one of the Sellers is, or becomes illegal, invalid or unenforceable in any respect, that shall not affect or impair the liabilities of the other Sellers under
this agreement. 

12.   RELEASE OF SELLERS  

	

	The
Purchaser may release, or compromise the liability of, any Seller or grant time or other indulgence to any Seller without releasing or reducing the liability of any
other Seller. Where a liability of one or some but not all of the Sellers under any obligation which is both joint and several is released or compromised, the remaining Sellers shall continue to be
severally and shall together be jointly liable on that obligation. 

13.   REMEDIES AND WAIVERS  

	13.1
	No
delay or omission by any party to this agreement in exercising any right, power or remedy provided by law or under this agreement or any other documents referred to in it shall: 
	13.1.1
	affect
that right, power or remedy; or

	13.1.2
	operate
as a waiver thereof. 

	13.2
	The
single or partial exercise of any right, power or remedy provided by law or under this agreement shall not preclude any other or further exercise of it or the exercise of any
other right, power or remedy.

	13.3
	The
rights, powers and remedies provided in this agreement are cumulative and not exclusive of any rights, powers and remedies provided by law. 

14.   ASSIGNMENT  

	

	The
Purchaser may at any time assign all or any part of the benefit of, or its rights or benefits under, this agreement (together with any causes of action arising in
connection with any of them) to its successor in title, any purchaser from the Purchaser, a subsidiary or holding company of the Purchaser or any subsidiary of such a holding company. No Seller may
assign any part of this agreement to any person without the prior written consent of the Purchaser. 

15.   FURTHER ASSURANCE  

	

	Each
of the Sellers shall from time to time at its own cost, on being required to do so by the Purchaser, now or at any time in the future, do or procure the doing of all
such acts and/or execute or procure the execution of all documents in a form satisfactory to the Purchaser which the Purchaser may reasonably consider necessary for giving full effect to this
agreement and securing to the Purchaser the full benefit of the rights, powers and remedies conferred upon the Purchaser in this agreement. 

17

   16.   ENTIRE AGREEMENT  

	16.1
	This
agreement, the Schedules to the agreement, the Disclosure Letter and any other documents referred to in this agreement (the "Share Purchase
Documents") constitute the whole and only agreement between the parties relating to the sale and purchase of the Shares.

	16.2
	Except
in the case of fraud, no party shall have any right of action against any other party to this agreement arising out of or in connection with any draft, agreement, undertaking,
representation, warranty, promise, assurance or arrangement of any nature whatsoever, whether or not in writing, relating to the subject matter of the Share Purchase Documents made or given by any
person at any time prior to the date of this agreement except to the extent that it is repeated in the Share Purchase Documents.

	16.3
	This
agreement may only be varied in writing signed by each of the parties. 

17.   NOTICES  

	17.1
	Except
where expressly stated otherwise, a notice under this agreement shall only be effective if it is in writing. Faxes, writing on the screen of a visual display unit and
e-mail are permitted.

	17.2
	Notices
under this agreement shall be sent to a party at its address or number and for the attention of the individual set out below: 

	Party and title of

individual
 
	 	Address
	 	Facsimile No.
	 	Email address

	Viasys Holdings, Inc

(fao Matthew Bennett)	 	c/o Viasys Healthcare Inc. Millennium III, 227 Washington Street, Suite 200, Conshohocken, PA, USA	 	+ 001 610 862 0780	 	matthew.bennett@viasyshc.com
	

Viasys Holdings Inc

(fao Edward Pulwer)	
 	

c/o Viasys Respiratory Care Inc,

22745 Savi Ranch Parkway,

Yorba Linda, CA 92887 USA	
 	

+001 714 919 3217	
 	

edward.pulwer@viasyshc.com
	

Philip Chowienczyk	
 	

6 Grotes Place,

London SE3 0HQ, England	
 	

+44 1634 893600	
 	

—
	

Ann Lawson	
 	

234 City Way,

Rochester, Kent ME1 2BN, England	
 	

+44 1634 893600	
 	

Chris.Lawson@micromedical.co.uk
	

Christopher Lawson	
 	

234 City Way,

Rochester, Kent ME1 2BN, England	
 	

+44 1634 893600	
 	

Chris.Lawson@micromedical.co.uk
	

Daniel Quirke	
 	

167 Maidstone Road,

Chatham, Kent, ME4 6JQ	
 	

+44 1634 893600	
 	

Daniel.Quirke@micromedical.co.uk
	

Jacqueline Quirke	
 	

167 Maidstone Road,

Chatham, Kent, ME4 6JQ	
 	

+44 1634 893600	
 	

Daniel.Quirke@micromedical.co.uk

Provided
that a party may change its notice details on giving notice to the other party of the change in accordance with this clause. That notice shall only be effective on the day falling five clear
Business Days after the notification has been received or such later date as may be specified in the notice. 

18

 

Any
notices given to the Purchaser should also be copied to: 

	Party and title of

individual
	 	Address
	 	Facsimile No.
	 	Email address

	Morgan Lewis & Bockius

(fao Keith Black)	 	2 Gresham Street, London EC2V 7PE	 	+44 (0)20 7710 5600	 	kblack@morganlewis.com

Any
notices given to the Sellers should also be copied to: 

	Party and title of

individual
	 	Address
	 	Facsimile No.
	 	Email address

	Cripps Harries Hall

(fao Lawrence Leporte)	 	Wallside House, 12 Mount Ephraim Road, Tunbridge Wells, Kent, TN1 1EG	 	+44 (0)1892 506 222	 	lal@crippslaw.com

	17.3
	Any
notice given under this agreement shall, in the absence of earlier receipt, be deemed to have been duly given as follows:

	17.3.1
	if
delivered personally, on delivery;

	17.3.2
	if
sent by first class post, two clear Business Days after the date of posting; and

	17.3.3
	if
sent by facsimile or e-mail, when despatched.

	17.4
	Any
notice given under this agreement outside Working Hours in the place to which it is addressed shall be deemed not to have been given until the start of the next period of Working
Hours in such place.

	17.5
	The
provisions of this clause shall not apply in relation to the service of Service Documents. 

18.   ANNOUNCEMENTS  

	18.1
	

	18.1.1
	Subject
to clause 18.1.2, no announcement concerning the sale of the Shares or any ancillary matter ("Announcements") shall
be made by any party without the prior written approval of all other parties, such approval not to be unreasonably withheld or delayed.

	18.1.2
	The
Purchaser (or any member of the Purchaser's Group as the case may be), at any time after Completion, shall be entitled to make Announcements without the consent of or other
than in consultation with the Sellers (i) if it is required to do so by law or the rules of the New York Stock Exchange to which it or any member of the Purchaser's Group is subject; or
(ii) or otherwise in the ordinary course of its business, but subject to the foregoing shall use reasonable commercial endeavors not to disclose the amount of individual Consideration received
by each Seller under this agreement.

	18.2
	Any
party after notice to the other parties, may make an announcement concerning the sale of the Shares or any ancillary matter if required by:

	18.2.1
	law;
or

	18.2.2
	any
securities exchange or regulatory or governmental body to which that party is subject or submits, wherever situated, whether or not the requirement has the force of law.

	18.3
	The
restrictions contained in this clause shall apply without limit in time. 

19

 

19.   CONFIDENTIALITY  

	19.1
	Each
party shall treat as confidential all information obtained as a result of entering into or performing this agreement which relates to:

	19.1.1
	the
provisions of this agreement;

	19.1.2
	the
negotiations relating to this agreement;

	19.1.3
	the
subject matter of this agreement; or

	19.1.4
	the
other parties.

	19.2
	Notwithstanding
the other provisions of this clause, either party may disclose confidential information:

	19.2.1
	if
and to the extent required by law or for the purpose of any judicial proceedings;

	19.2.2
	if
and to the extent required by any securities exchange or regulatory or governmental body to which that party is subject or submits, wherever situated, whether or not the
requirement for information has the force of law;

	19.2.3
	if
and to the extent required to vest the full benefit of this agreement in that party;

	19.2.4
	to
its professional advisers, auditors and bankers;

	19.2.5
	if
and to the extent the information has come into the public domain through no fault of that party; or

	19.2.6
	if
and to the extent the other party has given prior written consent to the disclosure, such consent not to be unreasonably withheld. 

	19.3
	The
restrictions contained in this clause shall apply without limit in time. 

20.   COSTS AND EXPENSES  

	20.1
	Except
as otherwise agreed in this agreement, each party shall pay its own costs and expenses in relation to the negotiations leading up to the sale and purchase of the Shares and
the preparation, execution and carrying into effect of this agreement and all other documents referred to in it and the Sellers confirm that no expense of whatever nature relating to the sale and
purchase of the Shares has been or is to be borne by any member of the Group. 

21.   COUNTERPARTS  

	21.1
	This
agreement may be executed in any number of counterparts, and by the parties on separate counterparts, but shall not be effective until each party has executed at least one
counterpart.

	21.2
	Each
counterpart shall constitute an original of this agreement, but all the counterparts shall together constitute but one and the same instrument. 

22.   INVALIDITY  

If
at any time any provision of this agreement is or becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, that shall not affect or impair: 

	22.1
	the
legality, validity or enforceability in that jurisdiction of any other provision of this agreement; or 

20

 

	22.2
	the
legality, validity or enforceability under the law of any other jurisdiction of that or any other provision of this agreement. 

23.   CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999  

The
parties to this agreement do not intend that any term of this agreement should be enforceable, by virtue of the Contracts (Rights of Third Parties) Act 1999, by any person who is not a party to
this agreement. 

24.   CHOICE OF GOVERNING LAW AND JURISDICTION  

	24.1
	This
agreement is to be governed by and construed in accordance with English law.

	24.2
	The
courts of England are to have jurisdiction to settle any dispute arising out of or in connection with this agreement. Any Proceedings may be brought in the English courts. 

25.   AGENT FOR SERVICE  

	25.1
	The
Purchaser irrevocably appoints Jordans Limited of 20-22 Bedford Row, London WC1R 4JS to be its agent for the receipt of service of process in England. It agrees that
any Service Document may be effectively served on it in connection with Proceedings in England and Wales by service on its agent.

	25.2
	Any
Service Document shall be deemed to have been duly served if marked for the attention of Jordans Limited of 20-22 Bedford Row, London WC1R 4JS or such other address
within England and Wales as may be notified to the party wishing to serve the Service Document and:

	25.2.1
	left
at the specified address; or

	25.2.2
	sent
to the specified address by first class post. 

In
the case of clause 25.2.1, the Service Document will be deemed to have been duly served when it is left. In the case of clause 25.2.2, the Service Document shall be deemed to have
been duly served two Business Days after the date of posting. 

	25.3
	If
the agent at any time ceases for any reason to act as such, the Purchaser shall appoint a replacement agent having an address for service in England or Wales and shall notify the
other parties of the name and address of the replacement agent. Failing such appointment and notification, the other parties shall be entitled by notice to the Purchaser to appoint a replacement agent
to act on the Purchaser's behalf. The provisions of this clause applying to service on an agent apply equally to service on a replacement agent.

	25.4
	A
copy of any Service Document served on an agent shall be sent by post to the Purchaser. Failure or delay in so doing shall not prejudice the effectiveness of service of the Service
Document.

	25.5
	For
the purposes of this clause 25 and clause 17.5, "Service Document" means a claim form, order or judgment issued out
of the courts of England and Wales or any document relating to or in connection with any Proceedings. 

21

 

EXECUTED by:-  

for and on behalf of
 VIASYS Holdings Inc

	/s/  FRANK J. MCCANEY      
 Frank J. McCaney

Authorised signatory	 	 
	

 SELLERS:	
 	

 
	

/s/  PHILIP JAN CHOWIENCZYK      
 Philip Jan Chowienczyk	
 	

 
	

/s/  ANN MARGARET LAWSON      
 Ann Margaret Lawson	
 	

 
	

/s/  CHRISTOPHER PATRICK LAWSON      
 Christopher Patrick Lawson	
 	

 
	

/s/  DANIEL QUIRKE      
 Daniel Quirke	
 	

 
	

/s/  JACQUELINE ELAINE LINDA QUIRKE      
 Jacqueline Elaine Linda Quirke	
 	

 
	

Trustees of the Daniel Quirke Children's Settlement No. 1
	

/s/  DANIEL QUIRKE      
 Daniel Quirke (as Trustee)	
 	

 
	

/s/  JACQUELINE ELAINE LINDA QUIRKE      
 Jacqueline Elaine Linda Quirke (as Trustee)	
 	

 

22

  

 
 

Schedule 1
  Completion arrangements    
    

At
Completion: 

	1.
	The
Sellers shall deliver to the Purchaser:

	1.1
	duly
executed transfers in respect of the Shares in favour of the Purchaser or such person as the Purchaser may nominate and share certificates for the Shares in the name of the
relevant transferors (or a certificate signed by the relevant Seller swearing that such share certificate has been lost, destroyed or never existed);

	1.2
	such
waivers or consents as the Purchaser may require to enable the Purchaser or its nominees to be registered as holders of the Shares;

	1.3
	the
Books and Records referred to in clause 9; and

	1.4
	all
consents or other waivers required pursuant to any contract or other agreement (including without limitation, any consents required under the agreement between the Company and
SpirXpert Group BV dated 12 September 2003) referred to in Schedule 2 in relation to any Relevant Property or relating to Environmental Matters or otherwise disclosed in the Disclosure
Letter.

	2.
	The
Sellers shall deliver to the Purchaser (or to any person whom the Purchaser may nominate) such of the following as the Purchaser may require:

	2.1
	the
statutory books (which shall be written up to but not including the Completion Date), the certificate of incorporation (and any certificate of incorporation on change of name) and
common seal (if any) (or the equivalent documents of any foreign jurisdiction) of each member of the Group and share certificates or other documents of title in respect of all the issued share capital
of each Subsidiary and of PT Medical BV which is owned directly or indirectly by the Company;

	2.2
	the
title deeds relating to each Relevant Property unless the Relevant Property is charged and title deeds to it are held by the chargee;

	2.3
	copies
(signed by the auditors) of the letters from the auditors of the Company and of each Subsidiary referred to in paragraph 4 below; and

	3.
	the
Sellers shall procure that:

	3.1
	(i) Christopher
Patrick Lawson and Philip Jan Chowienczyk shall each resign as a director of the Company; and (ii) Jacqueline Quirke shall resign as Company Secretary of
the Company, and in each case, shall relinquish any rights which they may have under any statutory provision including any right to damages for wrongful dismissal, redundancy payment or compensation
for loss of office or unfair dismissal, such resignations to be tendered at the board meetings referred to in paragraph 5 below; and

	4.
	the
present auditors of the Company and each Subsidiary to resign their office as such, and to deposit at the registered office of the Company or, as the case may be, the relevant
Subsidiary, a letter notifying their resignation, acknowledging that they have no claim against the Company or any Subsidiary and containing a statement pursuant to section 394(1) Companies Act
1985 that there are no circumstances connected with their ceasing to hold office which they consider should be brought to the attention of any members or creditors; 

23

 
	5.
	the
Sellers shall procure board meetings of the Company and of each Subsidiary to be held at which:

	5.1
	in
the case of the Company, it shall be resolved that each of the transfers relating to the Shares shall be approved for registration and (subject only to the transfer being duly
stamped) the Purchaser shall be registered as the holder of the Shares concerned in the register of members;

	5.2
	each
of Edward Pulwer and John Imperato shall be appointed directors of the Company and Mark Beale shall be appointed as the Company Secretary of the Company, or otherwise as the
Purchaser shall direct, such appointments to take effect on the Completion Date;

	5.3
	the
resignations of the directors and secretary referred to in paragraph 3.1 and the resignation of the auditors of the Company and each Subsidiary referred to in
paragraph 4 above shall be tendered and accepted so as to take effect at the close of the meeting and each of the persons tendering his resignation shall deliver to the relevant member of the
Group an acknowledgement executed as a deed that he has no claim against any member of the Group for breach of contract, compensation for loss of office, redundancy or unfair dismissal or on any other
account whatsoever and that no agreement or arrangement is outstanding under which any member of the Group has or could have any obligation to him; and

	5.4
	Baker
Tilly shall be appointed as auditors of the Company;

	6.
	The
Sellers shall deliver to the Purchaser executed contracts of employment between the Company and each of the Daniel Quirke and Christopher Patrick Lawson.

	7.
	The
Sellers shall deliver to the Purchaser, evidence satisfactory to the Purchaser, of the execution by Thomas Schoemaeker and Dean Forster of the IP Employment Amendment Agreement.

	8.
	The
Sellers shall deliver to the Purchaser, copies of duly executed forms 652A in respect of the commencement of striking-off proceedings for PulseTrace Limited and
MicroPulse Limited.

	9.
	The
Company shall enter into the MicroDirect Distributor Agreement. 

24

  

 
 

Schedule 2
  Representations and Warranties    
    

	1.
	Ownership of the Shares

	1.1
	Each
of the Sellers is the sole beneficial owner of the Shares set opposite his name in Schedule 5.

	1.2
	There
is no option, right to acquire, mortgage, charge, pledge, lien or other form of security or encumbrance or equity on, over or affecting the Shares or any of them and there is no
agreement or commitment to give or create any and no claim has been made by any person to be entitled to any.

 

	2.
	Capacity of the Sellers

	2.1
	Each
Seller has the requisite capacity, power and authority to enter into and perform this agreement and to execute, deliver and perform any obligations he or she may have under each
document to be delivered by that Seller at Completion. Entry into this agreement and the performance of the transactions as contemplated herein will not breach or contravene any provision or article
of the Memorandum and Articles of Association or the constitutional documents of any member of the Group, as applicable.

	2.2
	The
obligations of each Seller under this agreement constitute, and the obligations of each Seller under each document to be delivered by that Seller at Completion will when delivered
constitute, binding obligations of that Seller in accordance with their respective terms.

	2.3
	The
execution and delivery of, and the performance by each Seller of its obligations under, this agreement and each document to be delivered by that Seller at Completion will not:

	2.3.1
	result
in a breach of, or constitute a default under, any instrument by which any Seller or any member of the Group is bound; or

	2.3.2
	result
in a breach of any order, judgment or decree of any court or governmental agency by which any Seller or any member of the Group is bound.

 

	3.
	Group structure and corporate matters.

	3.1
	The
Shares have been validly issued and allotted and are fully paid up.

	3.2
	There
is no agreement or commitment outstanding which calls for the allotment, issue or transfer of, or accords to any person the right to call for the allotment, issue or transfer
of, any shares (including the Shares) or debentures in or securities of any member of the Group, or so far as the Sellers are aware, of PT Medical BV.

	3.3
	Each
of the undertakings of which basic information is given in Schedule 7 is (save in the case of PT Medical BV) a wholly-owned subsidiary of the Company (either directly or
indirectly) and its results are (save in the case of PT Medical BV) consolidated in the consolidated financial statements which form part of the Accounts.

	3.4
	Schedule 7
lists all the Subsidiaries of the Company and all associated companies of the Company and no member of the Group has any interest in any other body corporate,
unincorporated body, undertaking or association which is not a member of the Group.

	3.5
	The
information given in Schedule 5 to Schedule 8 inclusive is true and accurate in all respects and is not misleading because of any omission or ambiguity or for any
other reason.

	3.6
	The
copies of the memorandum and articles of association or other like documents of each member of the Group and of PT Medical BV which are attached to the Disclosure Letter are
complete and accurate in all respects.

	3.7
	The
statutory books (including all registers and minute books) of each member of the Group have been properly kept and contain an accurate and complete record of the matters which
should be dealt with in those books and no notice or allegation that any of them is incorrect or should be rectified has been received. 

25

 

	3.8
	The
Company is the sole legal and beneficial owner of 40% of the issued shares in PT Medical BV and there is no option, right to acquire, mortgage, charge, pledge, lien or other form
of security or encumbrance or equity on, over or affecting such shares or any of them and there is no agreement or commitment to give or create any and no claim has been made by any person to be
entitled to any.

	3.9
	So
far as the Sellers are aware, the Group does not have any liability or obligation which relates to, or which involves any claim, loss or damage which arises out of or relates to,
in whole or in part, any activity, matter or issue first occurring, condition existing, omission to act or other matter existing prior to Completion that in each case has arisen out of the investment
of the Company in, or otherwise in connection with, PT Medical BV, which is not disclosed in the Disclosure Letter.

 

	4.
	Accounts

	4.1
	The
Accounts:

	4.1.1
	were
prepared in accordance with applicable law and accounting principles and practices generally accepted in the United Kingdom (or, in the case of Micro Medical GmbH, with
applicable German law accounting principles and practices generally accepted in Germany) at the time they were audited or commonly adopted at that time by companies carrying on businesses similar to
those carried on by the respective members of the Group;

	4.1.2
	subject
to paragraph 4.1.1, were prepared on the same basis and in accordance with the same accounting principles and practices, consistently applied, as the audited
financial statements for the previous four financial periods;

	4.1.3
	include
full provision for bad and doubtful debts, for old depreciated and unsaleable stock and for Taxation on profits (whether of an income or capital nature) relating to any
period ending on or before the date to which they are made up;

	4.1.4
	show
a true and fair view of the state of affairs of the members of the Group to which they relate, and of the Group as a whole at each accounting reference date to which the
Accounts relate and of the profits or losses of the members of the Group to which they relate, and of the Group as a whole for each accounting period to which the Accounts relate; and

	4.1.5
	except
as the Accounts expressly disclose, are not affected by any extraordinary, exceptional or material (either individually or in the aggregate) non-recurring items.

	4.2
	At
the Accounts Date no member of the Group had any material (either individually or in the aggregate) liability (whether actual, contingent, unquantified or disputed) or material
(either individually or in the aggregate) outstanding capital commitment which is not adequately disclosed or provided for in the Accounts.

	4.3
	So
far as the Sellers are aware, no member of the Group has any liability or obligation which relates to, or which involves any claim, loss or damage which arises out of or relates
to, in whole or in part, any activity, matter or issue first occurring, condition existing, omission to act or other matter existing prior to Closing, which is not disclosed in the Accounts and/or the
Disclosure Letter.

 

	5.
	The Management Accounts

	5.1
	The
Management Accounts were prepared in accordance with consistent policies and principles.

	5.2
	The
Management Accounts fairly represent the trading performance of the members of the Group to which they relate at each date to which they relate and of the profits or losses of the
members of the Group to which they relate for each accounting period to which they relate. 

26

 

	6.
	The Budget

	

	The
Budget has been prepared with reasonable care after due and careful inquiry and on the same basis and in accordance with the same accounting principles and practices,
consistently applied, as the Accounts. The assumptions on which the Budget is based are reasonable assumptions and there are no other assumptions which ought reasonably to have been made in the
preparation of the Budget which have not been made.

	7.
	Events since the Accounts Date

	7.1
	Since
the Accounts Date:

	7.1.1
	there
has been no material adverse change in the financial or trading position or prospects of any member of the Group and, so far as the Sellers are aware, no circumstance has
arisen which give rise to any such change;

	7.1.2
	the
business of each member of the Group has been carried on in the ordinary and usual course and in the same manner (including nature and scope) as in the financial year ending on
the Accounts Date and no unusual or onerous contract differing from the routine contracts necessitated by the nature of its trade has been entered into by any member of the Group;

	7.1.3
	no
debts or other receivables and no trading stock, goods, plant, machinery or equipment of any member of the Group have been factored or sold or agreed to be sold, apart from the
sale of trading stock to trade customers or the public on that member's standard terms of business in the routine course of trading;

	7.1.4
	no
member of the Group has to an extent which may materially affect its profitability offered price reductions or discounts or allowances on sales of trading stocks or services or
provided them at less than cost;

	7.1.5
	no
member of the Group has entered into or agreed to enter into any distribution or agency agreement, whether written or oral and, so far as the Sellers are aware, no member of the
Group is contemplating entering into such distribution or agency agreement; and

	7.1.6
	no
member of the Group has had any of its products, in whole or in part, recalled or returned or otherwise rejected by any person or had any regulatory authority initiate any
investigation in relation to any of its products.

 

	8.
	Work in progress and trading stock

	8.1
	All
work in progress represented in the Accounts has been valued on a basis excluding profit and including adequate provision for losses which are or could reasonably be anticipated.

	8.2
	All
trading stock represented in the Accounts was valued at the lower of cost or net realisable value. None of the trading stock of any member of the Group is obsolete or slow moving
or out of date, fashion or demand or likely to realise less than its book value.

	8.3
	The
amounts of raw materials, work in progress, finished goods and packaging and promotional material held or ordered by each member of the Group are appropriate and normal for its
present level of business.

	8.4
	All
inventory and equipment of any member of the Group reflected in the Accounts, and all inventory and equipment owned by any member of the Group or acquired since the Accounts Date,
(a) was acquired in accordance with the regular business practices of the Group, (b) consisted and consists of items of a quality and quantity useable in the ordinary course of their
businesses consistent with past practice, subject to normal wear and tear and routine maintenance, (c) was and is valued in conformity with UK GAAP applied on a consistent basis and
(d) conformed and conforms to all applicable laws, ordinances, codes, rules and regulations relating thereto and to the construction, use, operation and maintenance thereof. 

27

 

None
of such inventory or equipment is obsolete or has been maintained other than in accordance with the regular business practices of the Group, which practices are, so far as the Sellers are aware
having made no enquiry, are at least consistent with reasonable industry and commercial practices. 

	9.
	Contracts and commitments

	9.1
	No
member of the Group is a party to or has any liability (present or future) under:

	9.1.1
	any
guarantee, indemnity, surety relationship or letter of credit;

	9.1.2
	any
contract for rent, lease, hire, hire purchase, credit sale, conditional sale or purchase by installments;

	9.1.3
	any
agency, distributorship or management agreement;

	9.1.4
	any
contract or arrangement which, directly or indirectly, restricts its freedom to carry on its business in any part of the world in such manner as it may think fit or the ability
to transfer the whole or any part of its business;

	9.1.5
	any
joint venture agreement or arrangement, partnership rights or obligations or any other agreement or arrangement under which it participates with any other person in any
business;

	9.1.6
	any
contract or arrangement which relates to matters not within the ordinary business of that member or constitutes a commercial transaction or arrangement deviant from the usual
pattern for that member or is not entirely on arms' length terms;

	9.1.7
	any
contract or arrangement in which any director of any member of the Group or any person connected with any such director is interested, either directly or indirectly;

	9.1.8
	any
loss-making contract;

	9.1.9
	any
contract or arrangement which is of three years' or greater duration or which, being of less than three years' duration, is of a length which significantly exceeds what is
normal in the circumstances;

	9.1.10
	any
contract or arrangement which cannot be terminated by that member on three months' notice or less without payment of compensation of any special fees;

	9.1.11
	any
contract or arrangement which can be terminated in the event of any change in the underlying ownership or control of that member or would be materially affected by such change;
or

	9.1.12
	other
than contracts of employment, any contract with any Seller.

	9.2
	Copies
of each agreement, document or other material evidencing or otherwise containing the terms and conditions of any material rights or obligations of any member of the Group, any
contracts or arrangements which are of a material value to any member of the Group in terms of expenditure or revenue expectations and any contracts that are of fundamental importance to the
activities of any member of the Group are attached to the Disclosure Letter.

	9.3
	Except
for any guarantee or warranty implied by law or contained in its standard terms of business (a copy of which is attached to the Disclosure Letter), no member of the Group has
given any guarantee, indemnity, warranty, or made any representation, in respect of goods or services supplied or contracted to be supplied by it or accepted any liability or obligation that would
apply after any such goods or services had been supplied by it.

 

	10.
	Powers of attorney

	

	No
member of the Group has given any power of attorney or other authority (express, implied or ostensible) which is still outstanding or effective to any person to enter
into any contract or commitment on its behalf other than to its employees to enter into routine trading contracts in the normal course of their duties. 

28

 
	11.
	Insurances

	11.1
	Each
member of the Group has maintained adequate insurance cover against risks normally insured against by companies carrying on a similar business, and in particular has maintained
all insurance required by statute and adequate product liability and environmental liability insurance, and has insured its assets against those risks to their full replacement value free from any
deduction or excess.

	11.2
	Full
details of the insurance policies in respect of which any member of the Group has an interest are included in the Disclosure Letter, all such policies are in full force and
effect and are not void or voidable, no claims are outstanding and no event has occurred which might give rise to any claim.

 

	12.
	Trading

	12.1
	During
the three years preceding the date of this agreement there has been no substantial change (apart from normal price changes) in the bases or terms on which any person has been
prepared to enter into contracts or to do business with any member of the Group and no change of that kind is expected.

	12.2
	No
substantial customer or supplier of any member of the Group has during the 12 months preceding the date of this agreement ceased or indicated an intention to cease trading
with that member or is likely to reduce substantially its trading with that member and so far as the Sellers are aware the attitude or actions, of customers, suppliers, and other persons with regard
to the Group will not be prejudicially affected by the execution of this agreement or Completion.

 

	13.
	Bank accounts and borrowings

	13.1
	Full
details of all bank accounts maintained by each member of the Group are set out in or attached to the Disclosure Letter. These details include in each case:

	13.1.1
	the
name and address of the bank with whom the account is kept and the number and nature of the account;

	13.1.2
	all
direct debit or standing order or similar authorities applicable to the account;

	13.1.3
	statements
showing all payments and receipts on the account for the period of three months ended on, and the balance on each account as at, the close of business on a date not
being more than seven days prior to the date of this agreement.

	13.2
	Full
details of all overdraft, loan and other financial facilities available to any member of the Group and the amounts outstanding under them are set out in the Disclosure Letter
and no Seller or any member of the Group has done anything whereby the continuance of any of those facilities might be affected or prejudiced. Details of all debentures, charges, guarantees and
indemnities given to secure those facilities are set out in the Disclosure Letter. 

29

  

	13.3
	The
total amount borrowed by each member of the Group from its bankers does not exceed its financial facilities and the total amount borrowed from whatsoever source does not exceed
any limitation on its borrowing contained in the relevant member's articles of association or similar constitutional documents.

	13.4
	Except
for the borrowings referred to in paragraphs 13.1 and 13.3 no member of the Group has any outstanding loan capital, nor has any member of the Group incurred or agreed to incur
any borrowing which it has not repaid or satisfied, nor is any member of the Group a party to or under any obligation in relation to:

	13.4.1
	any
loan agreement, debenture, acceptance credit facility, bill of exchange, promissory note, finance lease, debt or inventory financing, discounting or factoring arrangement or
sale and lease back arrangement; or

	13.4.2
	any
other arrangement the purpose of which is to raise money or provide finance or credit.

	13.5
	No
member of the Group has lent or agreed to lend any money which has not been repaid to it or owns the benefit of any debt present or future (other than debts due to it in respect
of the safe of trading stock in the normal course of trading).

	13.6
	No
member of the Group has borrowed any amount, from whatever source, after the Accounts Date.

 

	14.
	Working capital

The
existing bank and other facilities set out in the Disclosure Letter provide each member of the Group with sufficient working capital for its present requirements (that is to say, to enable it to
continue to carry on its business in its present form and at its present level of turnover) and for the purpose of performing in accordance with their terms all orders, projects and contractual
obligations which have been placed with or undertaken by it. 

	15.
	Insolvency

	15.1
	No
order has been made, no petition has been presented, no meeting has been convened to consider a resolution and no resolution has been passed for the winding up of any member of
the Group.

	15.2
	No
administration order has been made and no petition for such an order has been presented in respect of any member of the Group.

	15.3
	No
receiver (which expression shall include an administrative receiver) has been appointed in respect of any member of the Group or all or any of its assets.

	15.4
	No
voluntary arrangement has been proposed under section 1 Insolvency Act 1986 in respect of any member of the Group.

	15.5
	No
event analogous to any of the foregoing has occurred in relation to any member of the Group outside England and Wales.

	15.6
	No
member of the Group is insolvent, or unable to pay its debts within the meaning of section 123 Insolvency Act 1986, or has stopped paying its debts as they fall due.

	15.7
	No
unsatisfied judgment is outstanding against any member of the Group.

 

	16.
	Compliance and Regulatory Matters

	16.1
	All
licences, consents and other permissions and approvals required for or in connection with the carrying on of the business now being carried on by each member of the Group have
been obtained and are in full force and effect and are listed in the Disclosure Letter.

	16.2
	All
reports, returns and information required by law or as condition of any licence, consent, permission or approval to be made or given to any person or authority in connection with
the 

30

 

business
of any member of the Group have been made or given to the appropriate person or authority. 

	16.3
	All
products manufactured, tested, marketed, sold or distributed by each member of the Group are in compliance in all material respects with all applicable requirements of the
relevant regulatory authority and all licences, permissions, authorisation or consents required for testing or placing the products on the market and any modifications to any product marketed by any
member of the Group have been made in accordance with applicable laws and guidelines.

	16.4
	All
preclinical and clinical trials conducted by each member of the Group have been conducted in full compliance with all applicable laws, regulations and requirements of the
relevant competent authority and each member of the Group has obtained and maintained any necessary ethics committee approvals of clinical trials or modifications in respect of each clinical trial
conducted by any member of the Group. In no clinical trial conducted by any member of the Group has ethics committee approval been suspended or withdrawn because of deficiencies attributed to a member
of the Group.

	16.5
	Except
as disclosed in the Disclosure Letter, no regulatory authority or notified body has served any notice, regulatory letter or similar communication on any member of the Group
stating that the businesses were or are in breach of any law, regulation, approval, permission, authorisation, guidance or guideline or were or are the subject of any pending or anticipated regulatory
investigation, review or inquiry or that there are circumstances currently existing which might reasonably be expected to lead to any loss of a refusal to renew any of the licences, consents,
approvals, or authorisations held by any member of the Group.

	16.6
	Except
as identified in the Disclosure Letter, no products marketed by any member of the Group have been recalled or subjected to regulatory authority correction and no member of the
Group has received any order, demand or other formal proceedings completed or pending of any action by a regulatory authority or notified body for medical devices seeking corrective action or requires
recall of any products marketed by any member of the Group.

	16.7
	No
member of the Group has manufactured, sold or provided any product or service which does not in any material respect comply with all applicable laws, regulations or standards or
which is defective or dangerous or not in accordance with any representation or warranty, express or implied, given in respect of it.

 

	17.
	Litigation and claims

	17.1
	No
member of the Group is engaged in any litigation, arbitration or other dispute resolution process, or administrative or criminal proceedings, whether as claimant, defendant or
otherwise. No litigation, arbitration or other dispute resolution process, or administrative or criminal proceedings by or against any member of the Group is pending, threatened or expected. So far as
the Sellers are aware, there is no fact or circumstance likely to give rise to any litigation, arbitration, mediation or administrative or criminal proceedings.

	17.2
	The
documents attached to the Disclosure Letter which relate to any proceedings involving or relating to any member of the Group contain only information which has already been made
available to the parties to the proceedings and do not include any information or advice which is privileged.

 

	18.
	Data protection

	18.1
	Each
member of the Group is duly registered as a data controller under the Data Protection Act 1998 or the corresponding legislation of the country where the relevant member of the
Group is established which implements Directive 95/46 on the protection of individuals with regard to the processing of personal data and on the free movement of such data for all purposes for which
registration is required in respect of the business of that member of the 

31

 

Group
and accurate and complete particulars of the relevant registrations are set out in the Disclosure Letter. 

	18.2
	Each
member of the Group has complied with all relevant requirements of the data protection legislation relevant to its jurisdiction.

	18.3
	No
member of the Group has received a notice (including, without limitation, any enforcement notice), letter or complaint from the relevant data protection authorities alleging
breach by it of the appropriate data protection legislation and the Seller has no reason to believe that there are any circumstances which exist which might give rise to any such notice, letter or
complaint being served, given or made.

	18.4
	No
individual has been awarded compensation from any member of the Group under the Data Protection Act 1998 or any other relevant data protection legislation, no claim for such
compensation is outstanding and the Seller has no reason to believe that any circumstances exist which might lead to any claim for compensation being made.

	18.5
	No
order has been made against any member of the Group for the rectification, blocking, erasure or destruction of any data under the Data Protection Act 1998 or any other relevant
data protection legislation, no application for such an order is outstanding and the Seller has no reason to believe that any circumstances exist which might lead to any application for such an order
being made.

	18.6
	So
far as the Sellers are aware, no warrant has been issued under schedule 9 of the Data Protection Act 1998 or any other applicable data protection legislation authorising
any officers or servants of the relevant data protection authority to enter any of the premises of any member of the Group.

 

	19.
	Competition and trade regulation

	19.1
	No
member of the Group is or has been a party to or is or has been concerned in any agreement or arrangement or is conducting or has conducted itself (whether by omission or
otherwise) in a manner which:

	19.1.1
	infringes
Article 81 or 82 of the EC Treaty or section 2 or section 18 of the Competition Act 1998 or any other anti-trust or similar legislation
in any jurisdiction in which any member of the Group has assets or carries or intends to carry on business or where its activities may have an effect; or

	19.1.2
	is
unenforceable or void (whether in whole or in part) or renders it or any other member of the Group liable to civil, criminal or administrative proceedings by virtue of any
anti-trust or similar legislation in any jurisdiction in which any member of the Group has assets or carries on or intends to carry on business or where its activities may have an effect.

 

	20.
	Ownership and condition of assets

	20.1
	All
assets used by each member of the Group in the course of its business or which are necessary for the continuation of its business as it is now carried on are included in the
Accounts, except for current assets and fixed assets acquired since the Accounts Date in the normal course of trading.

	20.2
	Each
of the assets included in the Accounts or acquired by any member of the Group since the Accounts Date (other than current assets sold, realised or applied in the normal course
of trading) is owned both legally and beneficially by a member of the Group free from any third party rights, and each of those assets capable of possession is in the possession of a member of the
Group.

	20.3
	There
is no option, right to acquire, mortgage, charge, pledge, lien (other than a lien arising by operation of law in the ordinary course of trading) or other form of security or
encumbrance or equity on, over or affecting the whole or any part of the undertaking or 

32

 

assets
of any member of the Group and there is no agreement or commitment to give or create any and no claim has been made by any person to be entitled to any. 

	20.4
	All
plant and machinery (including fixed plant and machinery), vehicles and office equipment used by any member of the Group in connection with its business are in good repair and
condition, regularly maintained and fully serviceable and capable of being efficiently and properly used in connection with the business of the relevant member of the Group and none is obsolete.

	20.5
	The
plant register kept by each member of the Group which has been produced to the Purchaser for its inspection sets out a complete and accurate record of the plant and machinery and
vehicles owned or possessed by it.

 

	21.
	Intellectual Property

	21.1
	No
member of the Group uses or otherwise carries on its business under any names other than its corporate name.

	21.2
	Full
details of all registered Intellectual Property (and applications for any such right) and material unregistered Intellectual Property owned by any member of the Group are set
out in the Disclosure Letter and the specified member of the Group is the sole legal and beneficial owner of such rights free from all, charges, options, encumbrances and other rights.

	21.3
	All
renewal, application and other official registry fees and steps required for the maintenance, protection and enforcement of the Intellectual Property owned by any member of the
Group have been paid or taken.

	21.4
	So
far as the Sellers are aware, the Intellectual Property owned by each member of the Group is valid, subsisting and enforceable.

	21.5
	Full
details of all licences and agreements relating to Intellectual Property and Business Information (including, without limitation, research and development agreements, letters of
consent, settlement agreements, undertakings and co-operation agreements) entered into by any member of the Group are set out in the Disclosure Letter and no such licences or agreements
are capable of termination as a result of the change in the underlying ownership or control of any member of the Group.

	21.6
	No
member of the Group nor any third party is in breach of any licence or agreement required to be disclosed pursuant to paragraph 21.5 of this Schedule.

	21.7
	No
member of the Group is obliged to grant any licence, sub-licence or assignment in respect of any Intellectual Property or Business Information owned or used by any
member of the Group.

	21.8
	So
far as the Sellers are aware, no third party is infringing or making unauthorised use of, or has infringed or made unauthorised use of, any Intellectual Property or Business
Information owned or used by any member of the Group.

	21.9
	So
far as the Sellers are aware, the activities of the Group do not infringe or make unauthorised use of, and have not infringed or made unauthorised use of, the Intellectual
Property or Business Information of any third party.

	21.10
	Each
member of the Group either legally and beneficially owns or has a licence to use all Intellectual Property and Business Information necessary to carry on the business conducted
by that member of the Group in the manner currently carried on and to fulfil any existing plans or proposals.

	21.11
	So
far as the Sellers are aware, no Intellectual Property or Business Information (including any patents pending or awaiting application) is or is likely to become subject of a
claim, challenge, objection or opposition from any person, including but not limited to an employee, as to title, ownership, validity, enforceability, compensation or otherwise. 

33

 

	21.12
	None
of the Intellectual Property or Business Information owned by any member of the Group is the subject of any litigation, opposition or administrative proceedings.

	21.13
	So
far as the Sellers are aware, no Confidential Business Information proprietary to any member of the Group, has been disclosed to, or otherwise become known by, any third party
other than under an obligation of confidentiality.

	21.14
	No
member of the Group is a party to any confidentiality or other agreement, or subject to any duty, which restricts the free use or disclosure of its Business Information.

	21.15
	None
of the operations of any member of the Group give rise, or will give rise, to any royalty or like payment obligation to any person (other than any agreement disclosed pursuant
to paragraph 21.5 of this Schedule) and there is no liability to any person, including any employee, to pay compensation pursuant to section 40 Patents Act 1977, or any like provision in
any other jurisdiction.

	21.16
	No
steps need to be taken now or in the next three months to meet any administrative or procedural deadline (whether or not final or extendible) in order to obtain or maintain any
registrations in relation to any Intellectual Property owned by any member of the Group.

	21.17
	So
far as the Sellers are aware, no third party has registered or uses any domain name which is identical or similar to any trade mark (whether registered or unregistered and
including applications for registration) or name owned or used by any member of the Group.

 

	22.
	Information Technology

	22.1
	Full
details of all Information Technology owned by the members of the Group are set out in the Disclosure Letter and the specified member of the Group is the sole legal and
beneficial owner of all such Information Technology free from all liens, charges, encumbrances and other rights.

	22.2
	Full
details of all Information Technology used by, or on behalf of, but not owned by any member of the Group are set out in the Disclosure Letter.

	22.3
	All
Information Technology required to be disclosed under paragraphs 22.1 or 22.2 of this Schedule is in good working order and has been maintained in accordance with good industry
practice.

	22.4
	Full
details of all agreements and arrangements relating to Information Technology (including, without limitation, development, security, disaster recovery, EDI, source code escrow,
computer bureau services, maintenance and support, facilities management, website, domain name and outsourcing agreements) entered into by, or pursuant to which any benefit is obtained by, any member
of the Group are set out in the Disclosure Letter.

	22.5
	Neither
any member of the Group nor any third party is in breach of any agreement or arrangement required to be disclosed pursuant to paragraph 22.4 of this Schedule and no
such agreement or arrangement is capable of termination as a result of any change in the underlying ownership or control of any member of the Group.

	22.6
	None
of the Information Technology or domain names owned or used by any member of the Group is the subject of any litigation or other dispute or claim and so far as the Sellers are
aware, no litigation, dispute or claim is expected or likely in relation to any domain name owned or used by any member of the Group.

	22.7
	The
members of the Group have not experienced any material disruption in their respective businesses or operations as a result of (a) any security breach in relation to any
Information Technology, (b) any failure (whether arising from any bug, virus, defect or otherwise), lack of capacity or other sub-standard performance of any Information Technology,
or (c) any failure, interruption or defective operation of any Information Technology caused by the occurrence or processing of any date or dates. No circumstance exists which is likely or
expected to give rise to any such disruption. 

34

 

	22.8
	Each
member of the Group either legally and beneficially owns or has a contractual right to use all Information Technology necessary or required for the operation of the business
conducted by it in the manner carried on currently or at any time. Where Information Technology has been developed by persons other than employees of a member of the Group and which Information
Technology is used by a member of the Group in the case of its business (either as part of the information systems of the respective member of the Group or as part of a product marketed by that
business or any other member of the Group) then each member of the Group has obtained written assignments of copyright in such software and no third parties have any claims against any member of the
Group in respect of that Information Technology.

	22.9
	The
members of the Group have not disclosed any source code to any third party and no source code relating to any Proprietary Software has been disclosed to, or otherwise become
known by, any third party. No software code, whether source or object, used or owned by any member of the Group is or is likely to become subject to a public licence or a disclosure requirement of any
kind or incorporates any software subject to such a licence.

	22.10
	The
members of the Group are not individually or collectively a party to any agreement or arrangement, or otherwise subject to any duty, which (in either case) restricts the free
use or disclosure by any of them of any source code relating to any of the Proprietary Software.

	22.11
	Full
details of all domain names registered in the name of or used by any member of the Group are set out in the Disclosure Letter. There are not and have not been, and so far as
the Sellers are aware, no circumstance exists which is likely or expected to give rise to, any challenges or disputes in relation to any member of the Group's use or registration of any of the domain
names required to be disclosed by this paragraph 22.11. All registrations in relation to such domain names have been maintained and all related fees and necessary administrative steps have been
(respectively) paid and taken.

	22.12
	The
Disclosure Letter contains an accurate and comprehensive list of Information Technology in relation to which any member of the Group is entitled to access source code under
third party escrow agreements.

 

	23.
	Property

	23.1
	Relevant
Properties

	23.1.1
	The
Relevant Properties are the only Properties owned, used or occupied by members of the Group or in respect of which any member of the Group has any estate, interest, right or
liability. Each of the Relevant Properties is used and occupied for the purpose of the business of a member of the Group; and

	23.1.2
	All
written replies given by the Seller's solicitors in response to any written enquiries by or on behalf of the Purchaser were complete and accurate at the date they were given
and would still be complete and accurate if the replies were instead being given on the Completion Date. 

35

  

	23.2
	Title

	

	In
relation to each Relevant Property:

	23.2.1
	Neither
any member of the Group nor any Subsidiary has any right of ownership, right of use, option, right of first refusal or contractual obligation to purchase or any other legal
or equitable right affecting property other than the relevant Properties;

	23.2.2
	Neither
any member of the Group nor any company that is or has at any time been a subsidiary of the company has any actual or contingent liability in respect of any other Property;

	23.2.3
	Neither
any member of the Group nor any Subsidiary has given any guarantee or indemnity for any liability relating to any other Property, except 6 Ambley Green Gillingham, Kent
where the Purchaser has complied with the covenants given and there is no outstanding liability;

	23.2.4
	the
Property Owner holds such Relevant Property subject to the leases, underleases, tenancies, licences or other agreements or arrangements particulars of which are set out in
Schedule 8 but is otherwise in physical possession and actual occupation of the whole of such Relevant Property on an exclusive basis and no part of such Relevant Property is vacant;

 

	24.
	In relation to each Relevant Property:

	24.1
	Encumbrances 

No
notices of any breach of covenants, restrictions and other encumbrances affecting any Relevant Property have been received. 

	24.2
	Planning
matters

	24.2.1
	Each
Relevant Property is presently used for the purpose referred to in Schedule 8, which is a permitted use under applicable planning legislation;

	24.2.2
	All
necessary permissions and consents in respect of use for the purpose referred to in Schedule 8 and for any previous use and/or any development at each Relevant Property
have been obtained and all such use and development has been carried out in accordance with any such permissions and consents and with applicable planning legislation;

	24.2.3
	No
notices of any breach of conditions to any consent or permission or breach of consent or permission relating to any Relevant Property have been received.

	24.3
	Statutory
obligations 

No
notices of any breach of statute, order or regulations relating to each Relevant Property, its current use or development or the use of any fixtures, machinery or chattels in it, have been
received. 

	24.4
	Condition
of the Properties

	24.4.1
	Any
buildings or other structures on or comprising each Relevant Property is in a good state of repair and condition and neither any of the Sellers nor the relevant Property Owner
expect that the expenditure of any substantial sum of money will be required in respect of the Relevant Property within three years of the date of this agreement;

	24.4.2
	No
buildings or structures on any Relevant Property are undergoing substantial works of construction, refurbishment or alteration or have done so in the last five years;

	24.5
	Outgoings 

36

 

	24.5.1
	None
of the Relevant Properties is subject to the payment of any outgoings other than the uniform business rate or water rates (and, in the case of leaseholds, the rents, insurance
and service charge reserved by the Lease) all of which have been paid to date;

	24.6
	Disputes,
notices and claims

	24.6.1
	So
far as the Sellers are aware there are no outstanding disputes, actions, claims, demands or complaints in respect of any Relevant Property nor do so far as the Sellers are aware
are the Sellers or the relevant Property Owner expect any;

	24.6.2
	No
notice affecting any Relevant Property has been received nor do any of the Sellers or the relevant Property Owner so far as they are aware expect any;

	24.6.3
	There
are no outstanding monetary claims or liabilities contingent or otherwise in respect of any Relevant Property nor do the Sellers or the relevant Property Owner expect any;
and

	24.6.4
	Neither
any of the Sellers nor the relevant Property Owner have made any claim or complaint in relation to any neighbouring property or its use or occupation.

	24.7
	Leasehold
property

	24.7.1
	the
Relevant Property is held under the terms of the lease (the "Lease") briefly referred to in Schedule 8;

	24.7.2
	the
rent and all other sums payable under the Lease have been paid to date, all covenants and conditions contained in the Lease or in any licence, consent or other document entered
into supplemental to the Lease, whether on the part of the landlord or the tenant have been observed and performed to date, no breaches have been waived or acquiesced in and the Lease is valid and in
full force;

	24.7.3
	no
alterations or improvements carried out by the Property Owner or any other person are required by the Lease to be reinstated or removed on or before the end of the term;

	24.7.4
	the
landlord has not commenced forfeiture proceedings and no circumstances exist which could entitle a landlord to do so;

	24.7.5
	there
is no outstanding liability for dilapidations as a result of a breach of the repairing covenants under the Lease.

 

	25.
	Relevant Properties subject to tenancies

	25.1
	None
of the Relevant Properties are subject to tenancies.

	

	Fire
Certificate

	25.1.1
	Each
of the Relevant Properties has the benefit of a fire certificate, where required, the terms of which have been complied with;

	25.1.2
	all
covenants and conditions contained in the occupational licence or other document entered into supplemental to the licence have been observed and performed to date and no breach
has been waived or acquiesced in. 

37

 

	26.
	The Environment in respect of Site A4 and A5, Maritime Way, Chatham, Kent and 94/3-17 Innovation Building, Sittingbourne
Research Centre, Sittingbourne, Kent ("the Chatham and Sittingbourne Properties"):-

	

	In
paragraphs 26.1 and 26.2; 

	
"Environmental Laws"	
 	

means all applicable statutes and subordinate legislation and other national, federal, state and local laws, common laws or civil code, industry agreements, guidance notes or codes of conduct insofar as they relate to or apply to Environmental
Matters from time to time;
	
"Environmental Matters"	
 	

Means in relation to the Chatham and Sittingbourne Properties:
	

 	
 	

(i)	
 	

pollution or contamination;
	

 	
 	

(ii)	
 	

the disposal, release, spillage, deposit, escape, discharge, leak or emission of, Hazardous Materials or Waste;
	

 	
 	

(iii)	
 	

exposure of any person to Hazardous Materials or Waste;
	

 	
 	

(iv)	
 	

all matters related to health and safety at work;
	

 	
 	

(v)	
 	

the creation or existence of any noise, vibration, radiation, common law or statutory nuisance, or other adverse impact on the environment;
	

 	
 	

(vi)	
 	

use and recovery of packaging;
	

 	
 	

(vii)	
 	

any other matters relating to human health and safety or the condition, protection, maintenance, restoration or replacement of the environment arising directly or indirectly out or the manufacturing, processing, treatment, keeping, handing, use
(including as a building material), possession, supply, receipt, sale, purchase, import, export, transportation or presence of Hazardous Materials or Waste;
	
"Environmental Permits"	
 	

means any registration, permit, licence, consent or authorisation required by Environmental Laws in relation to either the carrying on of the business of any member of the Group or in relation to the Chatham and Sittingbourne Properties.
	
"Works"	
 	

means the carrying out of:
	

 	
 	

(i)	
 	

inspection, investigation, sampling and monitoring works; and
	

 	
 	

(ii)	
 	

any works, including the installation, operation, repair or replacement of plant or equipment, in order to remove, remediate or contain any Environmental Matter or in order to prevent an Environmental Matter.

38

 

	26.1
	Environmental
permits

	

	As
far as the Sellers are aware no material operating expenditure is required in order to comply with the Environmental Permits and no capital expenditure is proposed in
relation to Environmental Matters in relation to the carrying on of the business of the relevant member of the Group substantially as it is presently carried on.

	26.2
	Compliance

	26.2.1
	As
far as the Sellers are aware each member of the Group has complied during its ownership or occupation of the Chatham and Sittingbourne Properties at all times and in all
respects with Environmental Laws and there are and have been no acts or omissions of the Company in relation to Environmental Matters which could give rise to fines, penalties, losses, damages, costs,
expenses or liabilities or could require any Works;

	26.2.2
	During
its ownership or occupation of the Chatham and Sittingbourne Properties no member of the Group is or has been involved in any litigation proceedings, claim or complaint by
any person under Environmental Laws, none is threatened and, so far as the Sellers are aware, none is likely to arise. At no time during its ownership of the Chatham and Sittingbourne Properties has
any member of the Group received any notice or communication or information alleging any liability in relation to Environmental Matters or that any Works are required or stating or suggesting that
there is or might be any pollution, contamination or nuisance at or from the Chatham and Sittingbourne Properties; 

39

 

	26.2.3
	All
environmental audits and other assessments, reviews and reports in the possession or control of any member of the Group relating to the Chatham and Sittingbourne Properties or
any of the activities of the members of the Group relating to the Chatham and Sittingbourne Properties have been disclosed in the Disclosure Letter;

	

	As
far as the Sellers are aware no member of the Group has any liability in respect of Environmental Matters arising out of or in connection with any act or omission of
any former subsidiary, subsidiary undertaking or former business of any member of the Group in relation to the Chatham and Sittingbourne Properties.

 

	27.
	Employment and Benefit Plans

	27.1
	Details
of the jobs and the terms of employment of every employee of each member of the Group and the years of continuous service for redundancy purposes of that employee are set out
in the Disclosure Letter.

	27.2
	Full
details of any benefit received by any employee otherwise than in cash, and of any benefit received by any employee in cash which is related to sales, profits, turnover or
performance, or which is otherwise variable (other than normal overtime), are set out in the Disclosure Letter.

	27.3
	Full
particulars of the terms of engagement of all consultants, workers and other personnel currently engaged by each member of the Group who are not employees are contained in the
Disclosure Letter.

	27.4
	All
contracts of employment and all consultancy arrangements to which any member of the Group is a party (including any contract for services with any individual) can be terminated
by three months' notice or less without giving rise to a claim for damages or compensation (other than a statutory redundancy payment or statutory compensation for unfair dismissal).

	27.5
	No
employee or other personnel of any member of the Group has given notice terminating his contract of employment or engagement or is under notice of dismissal and no amount due to
or in respect of any employee or other personnel or former employee or personnel of any member of the Group is in arrears and unpaid other than his salary for the month current at the date of this
agreement.

	27.6
	Since
the Accounts Date, no change has been made in the emoluments or other terms of engagement of any employee or other personnel of any member of the Group, and no such change, and
no negotiation or request for such a change, is due or expected within six months from the date of this agreement.

	27.7
	There
is no dispute between any member of the Group and any trade union or other organisation formed for a similar purpose existing, pending or threatened and there is no collective
bargaining agreement or other arrangement (whether binding or not) to which any member of the Group is a party.

	27.8
	No
member of the Group has any outstanding undischarged liability to pay to any governmental or regulatory authority in any jurisdiction any contribution, Taxation or other impost
arising in connection with the employment or engagement of personnel by any member of the Group.

	27.9
	There
are no claims threatened or pending against any member of the Group by or in respect of any employee or other personnel or former employee or other personnel in respect of any
accident or injury or in relation to any other matter arising from his employment or engagement and there are no circumstances which may result in any dispute involving any of the employees.

	27.10
	Each
member of the Group has complied with the conditions and service of its employees or other personnel and all relevant order and awards made under all legislation affecting the
conditions of service of employees.

	27.11
	Each
member of the Group has complied in all material respects with all laws and codes of conduct and practice applicable in the legal jurisdiction relevant to that member of the
Group and all applicable European Union Directives applicable to employers and/or employees. There are no facts known to the Sellers which might suggest that there may be any claim against any member
of the Group under any applicable employment legislation. 

40

 

	27.12
	Save
for the Executive Personal Pension Plan underwritten by The Prudential Life Assurance Company for Daniel Quirke and Christopher Patrick Lawson, in respect of which all relevant
contributions have been made by the Company, no member of the Group is paying, or is under any liability (actual or contingent) to pay or secure (other than by payment of employers' contributions
under national insurance or social security legislation), any pension or other benefit on retirement, death or disability or on the attainment of a specified age or on the completion of a specified
number of years of service.

 

	28.
	The Accounts and Tax

	28.1
	No
member of the Group has any liability in respect of Taxation (whether actual or contingent, but excluding any Taxation arising as a consequence of a change in the law after
Completion and having retrospective effect) that is not fully disclosed or provided for in the Accounts and, in particular, has no outstanding liability for:

	28.1.1
	Taxation
in any part of the world assessable or payable by reference to profits, gains, income or distributions earned, received or paid or arising or deemed to arise on or at any
time prior to the Accounts Date or in respect of any period starting before the Accounts Date; or

	28.1.2
	Purchase,
value added, sales or other similar Tax in any part of the world referable to transactions effected on or before the Accounts Date

	

	that
is not provided for in full in the Accounts.

	28.2
	If
all facts and circumstances which are now known to each member of the Group or any of the Sellers had been known at the time the Accounts were drawn up, the provision for deferred
Taxation that would be contained in the Accounts would be no greater than the provision which is so contained. 

41

  

	29.
	Tax events since the Accounts Date

	29.1
	Since
the Accounts Date:

	29.1.1
	No
member of the Group has declared, made or paid any distribution within the meaning of Taxes Act or any corresponding legislation in any relevant foreign jurisdiction;

	29.1.2
	No
accounting period of any member of the Group has ended;

	29.1.3
	There
has been no disposal of any asset (including trading stock) or supply of any service or business facility of any kind (including a loan of money or the letting, hiring or
licensing of any property whether tangible or intangible) in circumstances where the consideration actually received or receivable for such disposal or supply was less than the consideration which
could be deemed to have been received for Tax purposes;

	29.1.4
	So
far as the Sellers are aware, no Event has occurred which will give rise to a Tax liability on any member of the Group calculated by reference to deemed (as opposed to actual)
income, profits or gains or which will result in any member of the Group becoming liable to pay or bear a Tax liability directly or primarily chargeable against or attributable to another person, firm
or company;

	29.1.5
	No
disposal has taken place or other event occurred which will or may have the effect of crystallising a liability to Taxation which should have been included in the provision for
deferred Taxation contained in the Accounts if such disposal or other Event had been planned or predicted at the Accounts Date;

	29.1.6
	No
member of the Group has made any payment or incurred any obligation to make a payment, in either case outside the ordinary course of business, which will not be deductible in
computing trading profits for the purposes of corporation Tax or any corresponding Tax in any relevant foreign jurisdiction, or be deductible as a management expense of an investment company;

	29.1.7
	No
member of the Group has been a party to any transaction for which any Tax clearance provided for by statute has been or was required to have been obtained; and

	29.1.8
	No
member of the Group has paid or become liable to pay or acted (directly or through an agent or other representative) in such manner as to incur a liability (or potential
liability) to pay any interest or penalty in connection with any Tax or otherwise paid any Tax after its due date for payment or become liable to pay any Tax the due date for payment of which has
passed or become prospectively liable to pay any Tax the due date for payment of which will arise in the 30 days after the date of this agreement.

 

	30.
	Tax returns, disputes, records and claims, etc.

	30.1
	Each
member of the Group has made or caused to be made all proper returns required to be made, and has supplied or caused to be supplied all information required to be supplied, to
any Tax Authority, including (but without limitation) the Inland Revenue and H.M. Customs and Excise.

	30.2
	There
is no dispute or disagreement outstanding nor is any contemplated at the date of this agreement with any Tax Authority, including (but without limitation) the Inland Revenue
and H.M. Customs and Excise, regarding liability or potential liability to any tax or duty (including in each case penalties or interest) recoverable from any member of the Group or regarding the
availability of any relief from Tax or duty to any member of the Group and there are no circumstances which make it likely that any such dispute or disagreement will commence. 

42

 

	30.3
	Each
member of the Group has sufficient records relating to past Events, including any elections made, to calculate the Tax liability or Relief which would arise on any disposal or
on the realisation of any asset owned at the Accounts Date by that company or acquired by any such member since that date but before Completion.

	30.4
	Each
member of the Group has duly submitted all claims and disclaimers or withdrawals of claims which are reflected in the Accounts.

	30.5
	The
amount of Tax chargeable on any member of the Group during any accounting period ended on or within six years before the Accounts Date has not, to any material extent, depended
on any concession, agreement or other formal or informal arrangement with any Tax Authority, including (but without limitation) the Inland Revenue or H.M. Customs and Excise.

	30.6
	No
member of the Group has received any notice from any Tax Authority, including (but without limitation) the Inland Revenue, which required or will or may require such member of the
Group to withhold tax from any payment made since the Accounts Date or which will or may be made after the date of this agreement.

 

	31.
	Installment payments, etc.

	31.1
	No
member of the Group is a "large company" within the meaning of regulation 3 of the Corporation Tax (Installment Payments) Regulations 1998.

 

	32.
	Stamp duty and stamp duty reserve tax

	32.1
	All
documents which are required to be stamped and which are in the possession of any member of the Group or by virtue of which any member of the Group has any right have been duly
stamped.

	32.2
	Since
the Accounts Date No member of the Group has incurred any liability to stamp duty reserve tax.

	32.3
	All
stamp duty land tax returns required to be filed by any member of the Group have been filed within the appropriate time limits, and all stamp duty land tax payable as a result of
any Event which has occurred before Completion has been paid.

 

	33.
	Value added tax

	33.1
	Each
member of the Group is registered for the purposes of VAT and has made, given, obtained and kept full, complete, correct and up-to-date returns, records,
invoices and other documents appropriate or required for those purposes and is not in arrears with any payments or returns due and such registration is not subject to conditions imposed by or agreed
with the relevant Tax Authority.

	33.2
	Each
member of the Group has complied fully with and observed in all material respects the terms of VAT Legislation.

	33.3
	Each
member of the Group obtains credit for all input tax paid or suffered by it.

	33.4
	No
member of the Group is or has been treated as a member of a group for the purposes of VAT Legislation, or has applied for such treatment.

	33.5
	No
member of the Group has been subject under VAT Legislation to any penalty, fine or surcharge, or any warning or notice which could (whether with or without other Events) lead to
the imposition of any penalty, fine or surcharge, or has been requested to give any security as a condition of making supplies for the purposes of VAT.

	33.6
	No
member of the Group currently has any overdue liability for VAT. 

43

 

	34.
	Tax on disposal of assets

	34.1
	On
a disposal of all its assets by any member of the Group for:

	34.1.1
	in
the case of each asset owned by that member of the Group at the Accounts Date, a consideration equal to the value attributed to that asset in preparing the Accounts; or

	34.1.2
	in
the case of each asset acquired since the Accounts Date, a consideration equal to the consideration given for the acquisition

	

	then
either: 

        34.1.2.1 in
respect of any asset falling within 34.1.1 above, the liability to Tax (if any) which would be incurred by that member of the Group in respect of that asset
would not exceed the amount taken into account in respect of that asset in computing the maximum liability to deferred Taxation as stated in the Accounts; or 

        34.1.2.2 in
respect of any asset within 34.1.2 above, no tax liability would be incurred by that member of the Group in respect of that asset. 

	35.
	Distributions

	35.1
	Since
its date of incorporation No member of the Group has made any repayment of share capital to which section 210(1) Taxes Act, or any similar legislation of a foreign
jurisdiction, applies or issued any share capital or other security as paid up otherwise than by the receipt of new consideration.

 

	36.
	Close company

	36.1
	The
Company is a close company as defined in Tax Act.

	36.2
	The
Company does not have outstanding any loan to which the provisions of section 419 Taxes Act would apply (loans to participators etc.).

	36.3
	The
Company is not, nor has at any time been a close investment-holding company as defined in section 13A Taxes Act.

	36.4
	The
Company has not issued a relevant discounted security to which paragraph 18 of Schedule 9 to the Finance Act 1996 may apply.

 

	37.
	Non-deductible revenue outgoings

	

	No
member of the Group is under any obligation to make any future payment outside the ordinary course of business which will be prevented (whether on the grounds of being
a distribution or for any other reason) from being deductible for corporation tax purposes, or any corresponding Tax in any relevant foreign jurisdiction.

	38.
	Deductions and withholdings

	

	Each
member of the Group has made all deductions in respect, or on account, of any Tax from any payments made by it which it is obliged to make and has accounted in full
to the appropriate authority for all amounts so deducted.

	39.
	Residence

	

	The
country which is given in Schedule 6 (Basic information about the Company) or Schedule 7 (Basic Information about the Subsidiaries and Associated
Companies) as the tax residence of the Company or any other member of the Group is the only country whose tax authorities seek to charge tax on the worldwide profits or gains of that member of the
Group and no member of the Group has ever paid tax on income profits or gains to any tax authority in any other country 

44

 

except
that mentioned in Schedule 6 (Basic information about the Company) or Schedule 7 (Basic information about the Subsidiaries and Associated Companies). 

	40.
	Group arrangements

	40.1
	The
Company is the beneficial owner of all the shares in each member of the Group and no such shares are held such that any profit on the sale of those shares would be a trading
receipt.

	40.2
	No
member of the Group has received any payment in respect of a surrender of group relief or of a tax refund which could, in any circumstances, be due to be repaid to any company
other than another member of the Group.

	40.3
	No
member of the Group has entered into any arrangements with the Inland Revenue within the meaning of section 36 Finance Act 1998.

 

	41.
	Demerger

	

	No
member of the Group has been concerned in an exempt distribution (as defined in section 214(4) Taxes Act or any similar legislation in any relevant foreign
jurisdiction).

	42.
	Non-arm's length transactions

	

	No
member of the Group is or has ever been a party to any transaction or arrangement under which it may be required to pay for any asset or services or facilities of any
kind an amount which is in excess of the market value of that asset or services or facilities or will receive any payment for any asset or services or facilities of any kind that it has supplied or
provided or is liable to supply or provide which is less than the market value of that asset or services or facilities. 

45

  

 
 

Schedule 3
  Sellers' limitations on liability    
    

	1.
	The
Purchaser shall not be entitled to damages in respect of any claim or claims under any of the Warranties unless the amount of each Substantiated claim exceeds $1000 and unless and
until the aggregate amount of all Substantiated claims exceeds $250,000 (but if this amount is exceeded, the Seller's liability shall be for the total amount of the claims and shall not be limited to
the excess). 

For
these purposes, "Substantiated" means a claim which is admitted by the Sellers or proved in a court of competent jurisdiction. 

	2.
	In
any event, the total aggregate liability of the Sellers under or in accordance with this agreement, the Warranties or otherwise shall not exceed a sum equal to the Consideration (as
adjusted) and the individual liability of the Sellers shall be with respect to each of them their Relevant Portion.

	3.
	No
claim shall be brought against the Sellers in respect of any breach of the Warranties (save in respect of any claim for breach of those Warranties given by the Sellers as set out in
paragraphs 1, 2, 3.1, 3.2 and 3.8 of Schedule 2 which claim may be bought at any time after Completion and shall not be subject to the thresholds set out in paragraphs 1 of this
Schedule 3), and no claim shall be brought against the Sellers under the tax Covenant unless the Purchaser shall have given to the Seller written notice of the claim specifying (in reasonable
detail) the matter which gives rise to the breach or claim, its nature and the amount claimed:

	(a)
	on
or before the 7th anniversary of the Completion Date in respect of claims relating to Taxation;

	(b)
	on
or before the 7th anniversary of the Completion Date in respect of claims relating to Environmental matters; and

	(c)
	on
or before the date which is 2 years and 5 days after the Completion Date in respect of any other matters. 

and
the liability of the Sellers for the claim specified in such notice shall, except in respect of claims relating to Taxation where the relevant period for the purposes of this paragraph 3
shall be 21 months, absolutely determine and cease unless (i) the amount payable in respect of the relevant claim has been agreed by the Sellers within 9 months of the date of
such written notice, or (ii) the Purchaser has instituted legal proceedings against the Sellers in respect of such claim by due service of process on the Sellers within 9 months of the
date of such written notice. 

	4.
	If
the Purchaser is entitled to claim under any policy of insurance in respect of any matter which would give rise to a breach of the Warranties, then no matter of this nature shall be
the subject of a claim under the Warranties unless and until the Purchaser shall have made a claim against its insurers. Any insurance claim shall then reduce any claims for breach of the Warranties
by the amount recovered (less all reasonable costs and expenses incurred by the Purchaser recovering that sum from its insurers) or extinguish the claim.

	5.
	Where
the Purchaser is at any time entitled to recover from some other person any sum in respect of any matter giving rise to a claim under the Warranties, the Purchaser shall take all
necessary steps to enforce recovery before making a claim against the Sellers.

	6.
	In
the event that the Purchaser shall recover any amount from another person, in accordance with paragraph 5 the amount of the claim against the Sellers shall then reduce by the
amount recovered (less all reasonable costs and expenses incurred by the Purchaser recovering that sum from the other person) or extinguish the claim.

	7.
	If
the Sellers pay at any time to the Purchaser an amount pursuant to a claim in respect of the Warranties and the Purchaser subsequently becomes entitled to recover from some other
person 

46

 

any
sum in respect of any matter giving rise to this claim, the Purchaser shall take all reasonable steps to enforce such recovery, and shall repay to the Sellers as soon as possible so much of the
amount paid to the Purchaser as does not exceed the sum recovered from such other person (less all reasonable costs and expenses incurred by the Purchaser recovering that sum from the other person). 

	8.
	The
Sellers shall not be liable for any claim under the Warranties to the extent that such claim (i) relates to matters fairly disclosed in the Disclosure Letter, and/or
(ii) relates to any matter specifically and fully provided for in the Accounts and/or the Completion Accounts, and/or (iii) arises as a consequence of any change in the law arising after
Completion (whether or not it has retrospective effect). 

47

  

 
 

Schedule 4
  Tax Covenant    
    

	1.
	In this Schedule, the following definitions shall have the following meanings:

	 	 	"Event"	 	includes (without limitation) the winding up or dissolution of any person, and any act, transaction or omission whatsoever, and any reference to an Event occurring on or before a particular date shall include Events which
for Tax purposes are deemed to have, or are treated or regarded as having, occurred on or before that date.
	

 	
 	

"Relevant Distribution"	
 	

has the meaning given to it in the Shadow ACT Regulations.
	

 	
 	

"Relief"	
 	

includes, unless the context otherwise requires, any allowance, credit, deduction, exemption or set-off in respect of any Tax or relevant to the computation of any income, profits or gains for the purposes of any Tax, or any other saving of Tax, and:
(a) any reference to the use or set off of Relief shall be construed accordingly and shall include use or set off in part; and (b) any
reference to the loss of a Relief shall include the absence or non-existence of any such Relief, or to such Relief being available only in a reduced amount in which case the loss shall refer only
to such reduced amount.
	

 	
 	

"Repayment" of Tax"	
 	

includes any repayment supplement or interest in respect of Tax, and any reference to loss of a right to Repayment of Tax includes its non-existence, reduction or cancellation and to set off shall include a set off in part.
	

 	
 	

"Tax"	
 	

includes (without limitation) corporation tax, income tax (including income tax or amounts on account of income tax required to be deducted or withheld from or accounted for in respect of any payment), capital gains tax, inheritance tax, value added
tax, national insurance contributions, stamp duty, stamp duty land tax and stamp duty reserve tax, duties of customs and excise, petroleum revenue tax, rates, all taxes, duties or charges replaced by or replacing any of them, and all other taxes on
gross or net income, profits or gains, distributions, receipts, sales, use, value added and all levies, imposts, duties, charges or withholdings in the nature of taxation, and any payment whatsoever which the relevant person is bound to make to any
person as a result of the discharge by that person of any tax which the relevant person has failed to discharge, together with all penalties, charges and interest relating to any of the foregoing or to any late or incorrect return in respect of any
of them, and regardless of whether any such taxes, levies, duties, imposts, charges, withholdings, penalties and interest are chargeable directly or primarily against or attributable directly or primarily to the relevant person or any other person
and of whether any amount in respect of any of them is recoverable from any other person.
	 	 	 	 	 

48

 

	

 	
 	

"Tax Claim"	
 	

means: (a) the issue of any notice, demand, assessment, letter or other document by or on behalf of any Tax Authority or the imposition of any withholding of or on account of Tax; or (b) the preparation or submission of any notice, return, assessment,
 letter or other document by the Purchaser, the Company, any Subsidiary or any other person, from which it appears that a Tax Liability has been incurred by or will be imposed on the Company or any Subsidiary.
	

 	
 	

"Tax Liability"	
 	

means both a liability of the Company or any Subsidiary to make or suffer an actual payment of Tax (or an amount in respect of Tax) and also: (a) the loss, or the use or set off against income, profits or gains earned, accrued or received on or
before Completion, of any Relief which arises or would but for such loss have arisen in respect of an Event occurring or period ending on or before Completion which would (were it not for the said loss, use or set off) have been available to the
Company or any Subsidiary following Completion and which was taken into account in computing the provision for deferred tax in the Completion Accounts or in eliminating such provision, or was taken into account as an asset in the Completion Accounts;
(b) (the use or set off of any Relief which arises in respect of an Event occurring or period ending after Completion in circumstances where, but for such use or set off, the Company or any Subsidiary would have had an actual Tax Liability in respect
of which the Purchaser would have been able to make a claim against a Seller under this Schedule; and (c) the loss by the Company or a Subsidiary of a right to Repayment of Tax which right was taken into account as an asset in preparing the
Completion Accounts, or the set off of any right to Repayment of Tax against any actual Tax Liability in respect of which the Purchaser would, but for that set off, have been able to make a claim against a Seller under this Schedule; and, in any case
falling within any of paragraphs (a), (b) and (c) above, the amount that is to be treated for the purposes of this Schedule as a Tax Liability of the Company or the Subsidiary shall be determined as follows: (i) in a case which falls within
paragraph (a) or (b) above and where the relief that is the subject of the loss or which is used or set off as mentioned in those paragraphs is a deduction from or offset against Tax, the Tax Liability shall be the amount of that Relief so lost, used
or set off; (ii) in a case which falls within paragraph (a) or (b) above and where the Relief that is the subject of the loss or which is used or set off as mentioned in those paragraphs is a deduction from or offset against income, profits
or gains, the Tax Liability shall be, in the case of a Relief which is used or set off, the amount of Tax saved thereby and, in the case of a Relief which is lost, the amount of Tax which but for such loss would have been saved by virtue of the
Relief so lost, ignoring for this purpose the effect of Reliefs (other than deductions in computing profits for the purpose of Tax) arising in respect of an Event occurring or period ending after the Completion Date; and (iii) in a case which falls
within paragraph (c) above, the Tax Liability shall be the amount of the repayment that would have been obtained but for the loss or setting off mentioned in that sub-paragraph.
	 	 	 	 	 

49

 

	1.1
	Any
reference to income, profits or gains "earned, accrued or received" on or before a particular date or in respect of a particular
period shall include income, profits or gains which for Tax purposes are deemed to have been or are treated or regarded as earned, accrued or received on or before that date or in respect of that
period.

	1.2
	Any
reference to something occurring (including a Tax Liability arising) in "the ordinary course of business" shall, without prejudice
to the generality thereof, be deemed not to include: (a) anything which involves, or leads directly or indirectly to, the receipt by the Company or either Subsidiary of a Tax Claim in respect
of any liability to Tax of, or properly attributable to, another person, firm or company; (b) anything which relates to or involves the supply of services (including the lending of money, or
the hiring or licensing of tangible or intangible property) in a transaction which is not entered into on arm's length terms; (c) anything which relates to or involves the making of a
distribution for Tax purposes, the creation, cancellation or re-organisation of share or loan capital, the creation, cancellation or repayment of any intra-group debt or any company
becoming or ceasing or being treated as ceasing to be a member of a group of companies or as becoming or ceasing to be associated or connected with any other company for any Tax purposes; or
(d) anything which relates to a transaction or arrangement which includes, or a series of transactions or arrangements which includes, any step or steps having no commercial or business purpose
apart from the reduction, avoidance or deferral of a Tax Liability.

	1.3
	Persons
shall be treated as "connected" for the purposes of this Schedule if they are connected within the meaning of
section 839 of the Taxes Act.

	1.4
	Any
reference to an Event occurring on or before Completion shall be deemed to include a series or combination of Events the first of which occurred on or before Completion provided
that such Events as shall have occurred after Completion shall have occurred in the ordinary course of business of the Company.

	1.5
	Any
stamp duty which is charged or chargeable on any document executed prior to Completion which is necessary to establish the title of the Company or any Subsidiary to any asset or
in the enforcement or production of which the Company or any Subsidiary is interested shall be deemed, together with any interest, fines or penalties relating to such stamp duty, to be a liability of
the Company or any Subsidiary to make an actual payment of Tax.

	1.6
	The
rule known as the ejusdem generis rule shall not apply and accordingly: (a) general words shall not be given a restrictive
meaning by reason of the fact that they are preceded by words 

50

 

indicating
a particular class of acts, matters or things; and (b) general words shall not be given a restrictive meaning by reason of the fact that they are followed by particular examples
intended to be embraced by the general words. 

	1.7
	In
this Schedule, unless the context otherwise requires:

	1.7.1
	references
to "persons" includes individuals, bodies corporate (wherever incorporated), unincorporated associations and partnerships;

	1.7.2
	the
headings are inserted for convenience only and do not affect the construction of this Schedule;

	1.7.3
	references
to one gender includes all genders;

	1.7.4
	any
reference to an enactment or statutory provision is a reference to it as it may have been, or may from time to time be, amended, modified, consolidated or
re-enacted;

	1.7.5
	references
to any English legal term for any action, remedy, method of judicial proceeding, legal document, legal status, court official or any other legal concept is, in respect of
any jurisdiction other than England, deemed to include the legal concept or term which most nearly approximates in that jurisdiction to the English legal term.

 

	2.
	Covenant to Pay

	

	The
Sellers hereby covenant with the Purchaser (for itself and as trustee for its successors in title) to pay to the Purchaser, so far as possible by way of adjustment to
the consideration for the sale of the Shares, an amount equivalent to:

	2.1
	any
Tax Liability arising in respect of, by reference to or in consequence of:

	2.1.1
	any
income, profits or gains earned, accrued or received on or before the Completion; and

	2.1.2
	any
Event which occurs or occurred on or before the Completion; and

	2.1.3
	any
failure to discharge or default in discharging any of the Sellers obligations under paragraph 7, including any failure to meet any relevant time limit;

	2.2
	any
Tax Liability which the Company or any Subsidiary is or becomes required to discharge by virtue of its relationship with any person (other than the Company or any Subsidiary) at
any time before the Completion.

 

	3.
	Exclusions

	

	The
covenant contained in paragraph 2.1 shall not cover any Tax Liability to the extent that:

	3.1
	provision
in respect of that Tax Liability has been made in the Accounts or the Completion Accounts; or

	3.2
	the
Tax Liability arises in respect of or by reference to any income, profits or gains earned in respect of the period, or any Event occurring, between the Last Accounts Date and the
Completion and which arises in the ordinary course of business of the Company or the 

51

 

Subsidiary
to which the Tax Liability relates, provided that this exclusion shall not apply to the extent that: 

	3.2.1
	the
Tax Liability comprises interest or penalties arising by virtue of an underpayment of Tax prior to Completion, insofar as such underpayment is an underpayment having regard to
circumstances existing and Events occurring prior to Completion; or

	3.2.2
	the
Event in question is the making of a relevant distribution; or

	3.3
	the
Tax Liability arises or is increased as a result only of any increase in rates of Tax which is announced and comes into force after Completion with retrospective effect or of any
change in law or published practice or the withdrawal of any extra statutory concession by and Tax Authority which is announced and comes into force after the Completion with retrospective effect.

	3.4
	recovery
(less costs and expenses) has been made by the Purchaser by way of a Warranty claim in respect of the same matter; or

	3.5
	the
Tax Liability would not have arisen but for a voluntary act or transaction carried out by the Purchaser or any member of the Group after Completion otherwise than in the ordinary
course of business or otherwise than pursuant to a legally binding obligation created on or prior to Completion, where in either such case such act or transaction was carried out without the consent
of the Sellers and the Purchaser knew or (had it taken appropriate professional advice) ought reasonably to have known that a Tax Liability would arise; or

	3.6
	the
Tax Liability is for stamp duty or stamp duty reserve tax payable on the transfer or agreement to transfer the Shares pursuant to this Agreement; or

	3.7
	the
Tax Liability has been made good or otherwise compensated for at no expense to the Purchaser or any member of the Group; or

	3.8
	the
Tax Liability is attributable to the Company and/or any member of the Group ceasing, from or after Completion, to be entitled to rates or corporation tax and/or capital allowances
and/or other Reliefs that are for smaller companies and to which the Group was entitled prior to Completion; or

	3.9
	the
Tax Liability arises or is increased by a voluntary act or transaction carried out by the Purchaser or any member of the Group after Completion that results in any installment of
corporation tax paid prior to Completion being insufficient.

 

	4.
	Costs and Expenses 

The
covenant contained in this Schedule shall extend to all reasonable costs and expenses properly incurred by the Purchaser, the Company or any Subsidiary in connection with a successful claim under
this Schedule or in connection with the subject matter of any such claim, including in connection with any action taken as referred to in paragraph 6 and any satisfaction or settlement of a Tax
Liability in accordance with that paragraph. 

	5.
	Withholdings 

	

	All
sums payable by the Sellers under this Schedule shall be paid free and clear of all deductions or withholdings unless the deduction or withholding is required by law,
in which event the Sellers shall pay such additional amount as shall be required to ensure that the net amount received by the Purchaser under this Schedule will equal the full amount which would have
been received by it had no such deduction or withholding been required to be made. 

52

 
	6.
	Tax on Covenant Payments
 

	

	If
any Tax Authority brings into charge to Tax any sum paid to the Purchaser under this Schedule (including in circumstances where any Relief is available in respect of
such charge to Tax), then the Sellers shall pay such additional amount as shall be required to ensure that the total amount paid, less the Tax chargeable on such amount (or that would be so chargeable
but for such Relief), is equal to the amount that would otherwise be payable under this Schedule.

	7.
	Notification of Claims and Conduct of Disputes

	7.1
	If
the Purchaser becomes aware of any Tax Claim relevant for the purposes of this Schedule, the Purchaser shall give, or shall procure that notice of that Tax Claim is given, to the
Sellers and shall (subject to paragraphs 7.2 and 7.3) take (or shall procure that the Company or the relevant Subsidiary shall take) such action as the Sellers may reasonably request to dispute,
resist, appeal, compromise or defend the Tax Claim and any adjudication in respect thereof.

	7.2
	The
Purchaser shall not be required to take any action pursuant to paragraph 7.1:

	7.2.1
	unless
the Purchaser and the Company or the Subsidiary concerned is each promptly indemnified to the Purchaser's reasonable satisfaction by the Sellers against all losses, costs,
damages and expenses that are or may be thereby incurred; or

	7.2.2
	if,
in the Purchaser's reasonable opinion, the action is likely to affect adversely either the future liability of the Purchaser, the Company or the Subsidiary concerned to Tax or
the business or financial interests of any of them or of any person connected with any of them.

	7.3
	If
the Sellers do not request the Purchaser to take any appropriate action within 21 days of notice to the Sellers, or no action is required to be taken by virtue of any of the
provisions of paragraph 7.2, the Purchaser shall be free to satisfy or settle (or to allow the Company or the Subsidiary concerned to satisfy or settle) the relevant Tax Liability on such terms
as it may in its absolute discretion think fit.

 

	8.
	Due Date of Payment and Interest

	8.1
	Where
a claim under this Schedule relates to a liability to make or suffer an actual payment or increased payment of Tax, the Sellers shall pay to the Purchaser the amount claimed
under this Schedule in respect thereof on or before the date which is the later of the date ten Business days after demand is made therefor under this Schedule and the fifth Business Day prior to:

	8.1.1
	in
the case of Tax in respect of which there is no provision for payment by installments, the latest date on which the Tax in question can be paid to the relevant Tax Authority in
order to avoid a liability to interest or penalties accruing; or

	8.1.2
	in
the case of Tax in respect of which there is provision for payment by installments, each date on which an installment of such Tax becomes payable (and so that on each such date
an appropriate proportion of the amount claimed shall be paid, such proportion to be notified by the Purchaser to the Sellers at least five Business days prior to each such date);

	8.1.3
	provided, that, if the date on which Tax to which this clause applies can be recovered is deferred following application to the
appropriate authority and the Sellers indemnify and secure the Purchaser, the Company and the Subsidiary concerned to the Purchaser's reasonable satisfaction in accordance with paragraph 7.2,
the date for payment by the Sellers shall be the earlier of the date on which the Tax becomes recoverable by the relevant Tax Authority (notwithstanding any initial deferral) and such date when the
amount of Tax is finally and conclusively determined. For this purpose, an amount of Tax shall be deemed to be finally determined when, in respect of such amount, an agreement under section 54
of the Taxes Management Act 1970 or any legislative provision corresponding to that section is made or a decision of a court or tribunal is given from which either no appeal lies or in respect of
which no appeal is made within the prescribed time limit. 

53

  

	8.2
	Where
a claim under this Schedule relates to the loss or set off of a right to a Repayment of Tax, the Sellers shall pay to the Purchaser the amount claimed under this Schedule in
respect thereof on or before the date which is the later of the date ten Business days after demand is made therefor under this Schedule and the date when such repayment would have been due were it
not for such loss or setting off.

	8.3
	Where
a claim under this Schedule relates to the loss, use or set off of any Relief, the Sellers shall pay to the Purchaser the amount claimed under this Schedule in respect thereof
on or before the date which is the later of the date ten Business days after demand is made therefor under this Schedule, and:

	8.3.1
	in
the case of a Relief which is used or set off, the date or dates referred to in paragraph 8.1(a) or (b) that would have applied to the Tax saved by the use or set
off of the Relief if that Tax had been payable; or

	8.3.2
	in
the case of a Relief which is lost, the date or dates referred to in paragraph 8.1(a) or (b) that apply to the Tax which but for such loss would have been saved by
virtue of such Relief, ignoring for this purpose the effect of Reliefs (other than deductions in computing profits for the purposes of Tax) arising in respect of an Event occurring or period ending
after the Completion.

	8.4
	Paragraphs
8.1 to 8.3 shall apply to any additional amount payable under paragraphs 4, 5 and 6 so that such amount shall be paid on the later of the date ten Business days after
demand is made therefor by or on behalf of the claimant and such other date or dates determined under paragraphs 8.1 to 8.3 in relation to the Tax, right to Repayment of Tax or Relief to which the
claim under paragraph 2 in respect of which such additional amount is due, relates.

	8.5
	Any
sum not paid by the Sellers on the due date for payment specified in this paragraph 8 shall bear interest (which shall accrue from day to day after as well as before any
judgment for the same) at the rate of 3 per cent. per annum over the base rate of Barclays Bank Plc (or in the absence of such rate at such similar rate as the Purchaser shall select) from the due
date to and including the day of actual payment of such sum, compounded quarterly. Such interest shall be paid on the demand of the Purchaser. 

9.     Recovery from Third Parties

	9.1
	If
any payment is made by the Sellers under this Schedule in full discharge of a liability which arises under this Schedule in respect of a Tax Liability and the Purchaser, the
Company or the Subsidiary concerned subsequently receives or becomes entitled to receive from any person other than the Purchaser, the Company or the Subsidiary concerned or any person connected with
any of them a payment or Relief in respect of the Tax Liability in question (which payment or Relief is received by virtue of a legal right), the Purchaser shall pay to the Sellers an amount equal to
the amount received or the amount that the Purchaser, the Company or the Subsidiary concerned will save by virtue of the receipt of the Relief (less the amount of all costs and expenses in obtaining
such payment or Relief, and net of any Tax payable on the amount received or that would have been payable but for the use or set off of any Relief) to the extent that the payment to the Sellers does
not exceed the payment originally made by the Sellers (net of any Tax suffered thereon), and to the extent that the right to such payment or Relief is not prejudiced thereby. To the extent that the
payment or Relief exceeds the payment originally made by the Sellers, such excess shall be carried forward and set off against any future liability of the UK Tax Warrantors under this Schedule.

	9.2
	Where
the Purchaser, the Company or the Subsidiary concerned receives a Relief as referred to in paragraph 9.1, a payment shall not be made to the Sellers before the date on
which the 

54

 

Tax
that would have been payable but for the Relief would have become recoverable by the appropriate Tax Authority, and shall not be made to the extent that, but for the use of such Relief the Company
or the Subsidiary concerned would have had an actual Tax Liability in respect of which the Purchaser would have been able to make a claim against the Sellers under this Schedule. 

10.   Secondary Liabilities

	10.1
	Subject
to paragraph 10.3 below, the Purchaser undertakes that it shall, and shall procure that the Company or the Subsidiary concerned shall discharge any Tax Liability to
the extent that failure on the part of the Company or the Subsidiary concerned to discharge that Tax Liability would give rise to a liability for the Sellers (or any company of which it has control)
to discharge that tax under the provisions imposing secondary liabilities under the Corporation Tax Acts (as defined in Section 831(1)(a) Taxes Act).

	10.2
	Subject
to paragraph 10.3 below, the Purchaser covenants with the Sellers that, to the extent that the Sellers (or any company of which it has control) are assessed to Tax
under the provisions imposing secondary liabilities under the Corporation Tax Acts (as defined in Section 831(1)(a) Taxes Act) as a result of the Purchaser, the Company or the Subsidiary
concerned failing to discharge a Tax Liability referred to in paragraph 8.1 above, they shall indemnify the Sellers in respect of any payments made by the Sellers (or any company of which it
has control) to discharge that assessment.

	10.3
	Paragraphs
10.1 and 10.2 above shall not apply to a Tax Liability referred to in paragraph 8.1 to the extent that it is an obligation of which the Sellers are liable under
this Schedule. 

11.   Savings

If
(at the request and expense of the Sellers) the auditors of the Company for the time being determine that the company has obtained a Saving as a consequence of any payment made by the Sellers in
accordance with the Tax Covenant, the Purchaser will as soon as reasonably practicable thereafter repay to the Sellers the lesser of: (i) the amount of the Saving less any costs incurred in
connection therewith by the Company or the Purchaser; and (ii) the amount paid by the Sellers in accordance with the Tax Covenant that gave rise to the Saving less any part of that amount
previously repaid to the Sellers under any provision of the Tax Covenant or otherwise. 

12.   Over-Provision

	12.1
	If
(at the request and expense of the Sellers) the auditors of the Company for the time being determine that any provision for Tax in the Completion Accounts has provided to be an
over-provision then the amount of such over-provision shall be dealt with in accordance with paragraph 12.2.

	12.2
	Where
it is provided under paragraph 12.1 that any amount (a "Relevant Amount") is to be dealt with in accordance with this paragraph 12.2);

	12.2.1
	the
relevant Amount shall be first set off against any payment then due from the Sellers under the Tax Covenant; and

	12.2.2
	to
the extent that there is an excess a refund shall be made to the Sellers of any previous payment or payments made by the Sellers under the tax Covenant and not previously repaid
to the Sellers under any provision of the Tax Covenant or otherwise up to the amount of such excess; and 

55

 

	12.2.3
	to
the extent that the excess referred to in sub-paragraph 12.2.2 is not exhausted, the remainder of that excess shall be carried forward and set off against any
future payment or payments that become due from the Sellers under the Tax Covenant. 

13.   Corporation Tax Returns

	13.1
	The
Sellers or their duly authorised agents shall at the cost and expense of the Company prepare the corporation tax returns and computations of each member of the Group for the
accounting period ended 31 December 2004 and shall submit them to the Purchaser or its duly authorised agents for review at least 30 days prior to the date they are due for filing.

	13.2
	The
Seller shall incorporate such amendments to such returns and computations as the Purchaser or their agents reasonably consider to be necessary, provided that if there is any
dispute as to whether any amendment is necessary Messrs Beak Kemmenoe, Chartered Accountants, of 1-3 Manor Road, Chatham, Kent RH2 0AD shall determine whether such amendments are necessary
and their decision shall be final and binding on the parties.

	13.3
	The
Purchaser shall (at its cost and expense) provide the Sellers with all such assistance as may reasonably be required in preparing such tax returns and computations, and will
procure that each relevant member of the Group will promptly sign and submit such tax returns and computations to the relevant Taxation Authority. 

14.   Assignment

	14.1
	The
rights and obligations under this Schedule may be transferred only with the written consent of the other party; provided, however, that the Purchaser may assign this Schedule or
any of its rights hereunder to an Affiliate without such consent. This Schedule shall be binding upon and shall inure to the benefit of the parties hereto, and their respective successors and
permitted assigns. 

56

  

 
 

Schedule 5
  Ownership of the Shares    
    

        Name and address of, and numbers of Shares beneficially owned by, each of the Sellers: 

	Full name
 
	 	Number of

Shares owned
	 	Percentage

owned
	 	Consideration

Payable ($)

	Philip Jan Chowienczyk	 	28,253	 	28.3	 	11,037,034
	Ann Margaret Lawson	 	14,114	 	14.1	 	5,513,634
	Christopher Patrick Lawson	 	14,139	 	14.1	 	5,523,401
	Daniel Quirke	 	28,332	 	28.3	 	11,067,895
	Daniel Quirke and Jacqueline Elaine Linda Quirke (joint holders, as Trustees of the Daniel Quirke Childrens' Settlement No.1)	 	5,081	 	5.1	 	1,984,893
	Jacqueline Elaine Linda Quirke	 	10,081	 	10.1	 	3,938,143
	 	 	
	 	
	 	 
	Total	 	100,000	 	100	 	39,065,000
	 	 	
	 	
	 	

57

  

 
 

Schedule 6
  Basic information about the Company    
    

	

1.	
 	

Registered number	
 	

: 01761018
	

2.	
 	

Date of incorporation	
 	

: 12 October 1983
	

3.	
 	

Place of incorporation	
 	

: England
	

4.	
 	

Address of registered office	
 	

: Quayside, Chatham Maritime,

  Chatham, Kent ME4 4QY
	

5.	
 	

Authorised share capital	
 	

: £100,000
	

6.	
 	

Issued share capital	
 	

: 100,000 ordinary shares of £1.00 each
	

7.	
 	

Loan capital	
 	

: None
	

8.	
 	

Directors:	
 	

:
	
 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

Philip Jon Chowienczyk	
 	

6 Grotes Place

London

SE3 0QH	
 	

British
	

 	
 	

Christopher Patrick Lawson	
 	

234 City Way

Rochester, Kent

ME1 2BN	
 	

British
	

 	
 	

Daniel Quirke	
 	

167 Maidstone Road

Chatham, Kent

ME4 4JQ	
 	

British
	

9.	
 	

Secretary:	
 	

 	
 	

 
	
 
	
 	

Full name
	
 	

Usual residential address
	
 	

 

	
 	
 	

Jacqueline Elaine Linda Quirke	
 	

167 Maidstone Road

Chatham, Kent

ME4 4JQ
	

10.	
 	

Accounting reference date	
 	

: 31 December
	

11.	
 	

Auditors	
 	

: Beak Kemmenoe
	

12.	
 	

Tax residence	
 	

: UK

58

  

 
 

Schedule 7
  Basic information about the Subsidiaries and Associated Companies    
    

	 
	 	 
	 	 
	 	 
	 	 
	 	 

	1.	 	Subsidiaries
	

 	
 	
1.1	
 	
MicroGas Limited
	

 	
 	

 	
 	

1.1.1	
 	

Registered number	
 	

: 03746555
	

 	
 	

 	
 	

1.1.2	
 	

Date of incorporation	
 	

: 7 April 1999
	

 	
 	

 	
 	

1.1.3	
 	

Place of incorporation	
 	

: England
	

 	
 	

 	
 	

1.1.4	
 	

Address of registered office	
 	

: Quayside, Chatham Maritime,

  Chatham, Kent ME4 4QY
	

 	
 	

 	
 	

1.1.5	
 	

Authorised share capital	
 	

: £100,000
	

 	
 	

 	
 	

1.1.6	
 	

Issued share capital	
 	

: 100 ordinary shares of £1.00 each
	

 	
 	

 	
 	

1.1.7	
 	

Loan capital	
 	

: None
	

 	
 	

 	
 	

1.1.8	
 	

Members:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
 
	
 	

Registered address
	
 	

Number of shares held

	
 	
 	

 	
 	

 	
 	

MicroMedical Limited	
 	

Quayside,

Chatham Maritime,

Chatham, Kent

ME4 4QY	
 	

100
	

 	
 	

 	
 	

1.1.9	
 	

Directors:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

 	
 	

 	
 	

Keith Charles Stoddart	
 	

24 Durham Road

Wigmore

Gilligham, Kent

ME8 8JW	
 	

British
	

 	
 	

 	
 	

1.1.10	
 	

Secretary:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

 

	
 	
 	

 	
 	

 	
 	

Sarah Louise MacKin	
 	

8 Windyridge,

Dorland,

Gillingham Kent,

ME7 3BB	
 	

 
	

 	
 	

 	
 	

1.1.11	
 	

Accounting reference date	
 	

: 31 December
	

 	
 	

 	
 	

1.1.12	
 	

Auditors	
 	

: None
	

 	
 	

 	
 	

1.1.13	
 	

Tax residence	
 	

: UK
	

 	
 	
2.1	
 	
MicroPulse Limited
	

 	
 	

 	
 	

2.1.1	
 	

Registered number	
 	

: 03989663
	

 	
 	

 	
 	

2.1.2	
 	

Date of incorporation	
 	

: 10 May 2000
	

 	
 	

 	
 	

2.1.3	
 	

Place of incorporation	
 	

: England
	

 	
 	

 	
 	

2.1.4	
 	

Address of registered office	
 	

: Quayside, Chatham Maritime,

  Chatham, Kent

  ME4 4QY
	

 	
 	

 	
 	

2.1.5	
 	

Authorised share capital	
 	

: £100,000
	

 	
 	

 	
 	

2.1.6	
 	

Issued share capital	
 	

: 100 ordinary shares of £1.00 each
	

 	
 	

 	
 	

2.1.7	
 	

Loan capital	
 	

: None
	 	 	 	 	 	 	 	 	 	 	 

59

 

	

 	
 	

 	
 	

2.1.8	
 	

Members:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Registered address
	
 	

Number of shares held

	
 	
 	

 	
 	

 	
 	

MicroMedical Limited	
 	

Quayside,

Chatham Maritime,

Chatham, Kent

ME4 4QY	
 	

100
	

 	
 	

 	
 	

2.1.9	
 	

Directors:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

 	
 	

 	
 	

Daniel Quirke	
 	

167 Maidstone Road

Chatham, Kent

ME4 4JQ	
 	

British
	

 	
 	

 	
 	

 	
 	

Christopher Patrick Lawson	
 	

234 City Way

Rochester, Kent

ME1 2BN	
 	

British
	

 	
 	

 	
 	

2.1.10	
 	

Secretary:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

 	
 	

 	
 	

Christopher Patrick Lawson	
 	

234 City Way

Rochester, Kent

ME1 2BN	
 	

British
	

 	
 	

 	
 	

2.1.11	
 	

Accounting reference date	
 	

: 31 December
	

 	
 	

 	
 	

2.1.12	
 	

Auditors	
 	

: None
	

 	
 	

 	
 	

2.1.13	
 	

Tax residence	
 	

: UK
	

 	
 	
3.1	
 	
PulseTrace Limited
	

 	
 	

 	
 	

3.1.1	
 	

Registered number	
 	

: 03986021
	

 	
 	

 	
 	

3.1.2	
 	

Date of incorporation	
 	

: 4 May 2000
	

 	
 	

 	
 	

3.1.3	
 	

Place of incorporation	
 	

: England
	

 	
 	

 	
 	

3.1.4	
 	

Address of registered office	
 	

: Quayside, Chatham Maritime,

  Chatham, Kent ME4 4QY
	

 	
 	

 	
 	

3.1.5	
 	

Authorised share capital	
 	

: £100,000
	

 	
 	

 	
 	

3.1.6	
 	

Issued share capital	
 	

: 100 ordinary shares of £1.00 each
	

 	
 	

 	
 	

3.1.7	
 	

Loan capital	
 	

: None
	

 	
 	

 	
 	

3.1.8	
 	

Members:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Registered address
	
 	

Number of shares held

	
 	
 	

 	
 	

 	
 	

MicroMedical Limited	
 	

Quayside,

Chatham Maritime,

Chatham, Kent

ME4 4QY	
 	

100
	

 	
 	

 	
 	

3.1.9	
 	

Director:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

 	
 	

 	
 	

Daniel Quirke	
 	

167 Maidstone Road

Chatham, Kent

ME4 4JQ	
 	

British
	 	 	 	 	 	 	 	 	 	 	 

60

 

	

 	
 	

 	
 	

 	
 	

Christopher Patrick Lawson	
 	

234 City Way

Rochester, Kent

ME1 2BN	
 	

British
	

 	
 	

 	
 	

3.1.10	
 	

Secretary:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

 	
 	

 	
 	

Christopher Patrick Lawson	
 	

234 City Way

Rochester, Kent

ME1 2BN	
 	

British
	

 	
 	

 	
 	

3.1.11	
 	

Accounting reference date	
 	

: 31 December
	

 	
 	

 	
 	

3.1.12	
 	

Auditors	
 	

: None
	

 	
 	

 	
 	

3.1.13	
 	

Tax residence	
 	

: UK
	

 	
 	
4.1	
 	
MicroMedical Deutschland GmbH
	

 	
 	

 	
 	

4.1.1	
 	

Registered number	
 	

: Unknown
	

 	
 	

 	
 	

4.1.2	
 	

Date of incorporation	
 	

: 11 January 2001
	

 	
 	

 	
 	

4.1.3	
 	

Place of incorporation	
 	

: Hamburg, Germany
	

 	
 	

 	
 	

4.1.4	
 	

Address of registered office	
 	

: Kieler Str. 675,22527
	

 	
 	

 	
 	

 	
 	

 	
 	

Hamburg
	

 	
 	

 	
 	

4.1.5	
 	

Authorised share capital	
 	

: Unknown
	

 	
 	

 	
 	

4.1.6	
 	

Issued share capital	
 	

: EUR 25.000 (as at the date of

  incorporation)
	

 	
 	

 	
 	

4.1.7	
 	

Loan capital	
 	

: Unknown
	

 	
 	

 	
 	

4.1.8	
 	

Members:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Registered address
	
 	

Number of shares held

	
 	
 	

 	
 	

 	
 	

Micro Medical Limited	
 	

Quayside,

Chatham Maritime,

Chatham, Kent

ME4 4QY	
 	

100%
	

 	
 	

 	
 	

4.1.9	
 	

Director:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

 	
 	

 	
 	

Daniel Quirke	
 	

167 Maidstone Road

Chatham, Kent

ME4 4JQ	
 	

British
	

 	
 	

 	
 	

 	
 	

Alfred Muller	
 	

Mergenthalerweg 7b

22523 Hamburg, Germany	
 	

German
	

 	
 	

 	
 	

4.1.10	
 	

Accounting reference date	
 	

: 31 December
	

 	
 	

 	
 	

4.1.11	
 	

Auditors	
 	

: Knuppel & Partner
	

 	
 	

 	
 	

 	
 	

 	
 	

Kieler Strape 707
	

 	
 	

 	
 	

 	
 	

 	
 	

22527 Hamburg, Germany
	

 	
 	

 	
 	

4.1.12	
 	

Tax residence	
 	

: United Kingdom
	
1.	
 	
Associated Companies
	

 	
 	

 	
 	
PT Medical BV
	

 	
 	

 	
 	

1.1.1	
 	

Registered number	
 	

: Unknown
	

 	
 	

 	
 	

1.1.2	
 	

Date of incorporation	
 	

: 3 May 2000
	 	 	 	 	 	 	 	 	 	 	 

61

 

	

 	
 	

 	
 	

1.1.3	
 	

Place of incorporation	
 	

: Gemeente, Leek, Netherlands
	

 	
 	

 	
 	

1.1.4	
 	

Address of registered office	
 	

: Lorentzpark 12, 9351 VJ Leek
	

 	
 	

 	
 	

1.1.5	
 	

Authorised share capital	
 	

: EUR 90.756,04
	

 	
 	

 	
 	

1.1.6	
 	

Issued share capital	
 	

: EUR 18.151,21
	

 	
 	

 	
 	

1.1.7	
 	

Loan capital	
 	

: Unknown
	

 	
 	

 	
 	

1.1.8	
 	

Members:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Registered address
	
 	

Number of shares held

	
 	
 	

 	
 	

 	
 	

Micro Medical Limited	
 	

Quayside,

Chatham Maritime,

Chatham, Kent

ME4 4QY	
 	

40% of shares
	

 	
 	

 	
 	

 	
 	

Other members unknown	
 	

 	
 	

60% of shares
	

 	
 	

 	
 	

1.1.9	
 	

Director:	
 	

 	
 	

 
	
 
	
 	

 
	
 	

 
	
 	

Full name
	
 	

Usual residential address
	
 	

Nationality

	
 	
 	

 	
 	

 	
 	

Jos Plenter	
 	

Zwaluwstraat 32,

9331KG Norg	
 	

Dutch
	

 	
 	

 	
 	

1.1.10	
 	

Accounting reference date	
 	

: Unknown
	

 	
 	

 	
 	

1.1.11	
 	

Auditors	
 	

: Unknown
	

 	
 	

 	
 	

1.1.12	
 	

Tax residence	
 	

: Netherlands

62

  

 
 

Schedule 8
  Property    
    

 
  PART A
  Relevant Properties    
    

1.     Freehold Properties with registered titles  

	Registered proprietor (owner)
 
	 	Title number
	 	Nature of title
	 	Short description
	 	Use

	NONE	 	 	 	 	 	 	 	 

2.     Freehold Properties with unregistered titles  

	Estate owner
 
	 	Date of conveyance to estate owner
	 	Parties
	 	Short description
	 	Use

	NONE	 	 	 	 	 	 	 	 

3.     Leasehold Properties with registered titles  

	Registered proprietor (owner)
 
	 	Title number
	 	Nature and Date of title lease
	 	Parties
	 	Term
	 	Current rental
	 	Short description
	 	Use

	NONE	 	 	 	 	 	 	 	 	 	 	 	 	 	 

4.     Leasehold Properties with unregistered title  

	Present lessee (owner)
 
	 	Date of lease
	 	Parties
	 	Term
	 	Current rental
	 	Short description
	 	Use

	MICRO MEDICAL LIMITED	 	N/A	 	TRADETEAM LIMITED(1) AND MICRO MEDICAL LIMITED(2)	 	MONTHLY PERIODIC TENANCY	 	 	 	OFFICE 13 AND 14 AT NUTSEY LANE TOTTON SOUTHAMPTON	 	OFFICES
	

MICRO MEDICAL LIMITED	
 	

17 DECEMBER 2003	
 	

LESLEY MARY DUCKITT & JOHN ANTHONY PIPER(1) AND MICRO MEDICAL LIMITED(2)	
 	

MONTHLY LICENCE (2 MONTHS NOTICE REQUIRED TO TERMINATE)	
 	

£895 PLUS VAT PER MONTH	
 	

OFFICE 1 THE OLD VICARAGE CASTLE DONINGTON DERBYSHIRE	
 	

OFFICES
	

MICROGAS LTD	
 	

1 JULY 2000	
 	

DENCORA PROPERTIES LIMITED(1) AND MICROGAS LTD(2)	
 	

TENANCY AT WILL	
 	

£278.85 PER WEEK	
 	

94/13 TO 17 INNOVATION BUILDINGS SITTINGBOURNE RESEARCH CENTRE SITTINGBOURNE KENT ME9 8HL	
 	

OFFICES
	

TIM SUTTON	
 	

1 JANUARY 2003	
 	

BASSETLAW DISTRICT COUNCIL(1) AND KEITH STODDART(2)	
 	

TENANCY AT WILL	
 	

£1,200 PER ANNUM	
 	

UNIT NUMBER 16 (OFFICE SUITE 1) OLD BREWERY YARD KILTON ROAD WORKSOP	
 	

OFFICES
	

MICROMEDICAL LIMITED	
 	

14 NOVEMBER 2003	
 	

MR R SUTTON(1) AND MICRO MEDICAL LIMITED(2)	
 	

6 YEARS FROM 14 NOVEMBER 2003	
 	

£13,750 (SUBJECT TO REVIEW) PER ANNUM	
 	

UNIT A1 LAKESIDE PARK NEPTUNE WAY ROCHESTER KENT	
 	

WAREHOUSE FOR STORAGE AND DISTRIBUTION

5.     Other Property  

	Owner
 
	 	Country in which situated
	 	General description
	 	Use

	 	 	GERMANY	 	 	 	 
	

 	
 	

JORDAN	
 	

 	
 	

 

63

  

 
 

Schedule 9
  Basis of Completion Accounts    
    

	1.
	Subject
to paragraphs 2 – 4 below, the completion accounts will be prepared in accordance with (a) UK GAAP and (b) the Sellers' past practices
to the extent consistent with UK GAAP.

	2.
	Inventory—Within
90 days of the completion date, the Purchaser will complete a full physical inventory of the inventory in the Group as of the Completion Date in
accordance with UK GAAP. In the Completion Accounts, inventory will be assigned a value consistent with this physical inventory. Damaged, slow moving or obsolete inventory will not be given any value
in the Completion Accounts.

	3.
	Accounts
receivable—Any accounts receivable not collected within 90 days of the Completion Date (the "Cut Off Date") will not be given any value in the Completion
Accounts. For the avoidance of doubt, amounts owed by Group undertakings (which in the Accounts were £901,338) shall not be regarded as accounts receivable for this purpose. The Purchaser
will use its reasonable endeavours to collect such accounts receivable as are not collected within 90 Days of the Completion Date and will remit to the Sellers the value of any accounts receivable
that are collected following the Cut Off Date.

	4.
	The
Completion Accounts shall contain a full and correct account and provision for all Taxation liabilities. 

64

  

 
 

Schedule 10
  Form of Key Personnel Contracts    
    

65

 
 
 

Schedule 11
  Form of Escrow Agreement    
    

66

 
 
 

Schedule 12
  Form of IP Employment Amendment Agreement    
    

67

 
 
 

Schedule 13
  Form of MicroDirect Distributor Agreement    
    

68

  

 
 

Annex 1    
    

Micro Medicak

Target P&L  

	Micro Medicak

Target P&L
 
	 	3.0

Forecast

2005
	 	12 Months

Viasys

Forecast

2005
	 	9 Month

2005

P&L

Impact
	 	Projected

2006
	 	Projected

2007
	 
	Revenues—product	 	$	4,366	 	$	17,465	 	$	13,099	 	$	20,249	 	$	23,109	 
	% change vs prior year	 	 	 	 	 	 	 	 	 	 	 	15.9	%	 	14.1	%
	

Material Purchases	
 	
 	

1,004	
 	
 	

4,017	
 	
 	

3,013	
 	
 	

4,657	
 	
 	

5,315	
 
	Service	 	 	56	 	 	222	 	 	166	 	 	269	 	 	277	 
	Labor/Overhead	 	 	351	 	 	1,404	 	 	1,053	 	 	1,652	 	 	1,775	 
	 	 	
	 	
	 	
	 	
	 	
	 
	Gross Profit	 	 	2,955	 	 	11,822	 	 	8,867	 	 	13,671	 	 	15,742	 
	as a % of revenues	 	 	67.7	%	 	67.7	%	 	67.7	%	 	67.5	%	 	68.1	%
	

Marketing/Selling	
 	
 	

1,038	
 	
 	

4,153	
 	
 	

3,115	
 	
 	

4,981	
 	
 	

5,706	
 
	G&A	 	 	373	 	 	1,492	 	 	1,119	 	 	1,542	 	 	1,671	 
	R&D	 	 	502	 	 	2,008	 	 	1,506	 	 	2,008	 	 	2,105	 
	 	 	
	 	
	 	
	 	
	 	
	 
	Total Operating Expenses	 	 	1,913	 	 	7,653	 	 	5,740	 	 	8,531	 	 	9,482	 
	as a % of revenues	 	 	43.8	%	 	43.8	%	 	43.8	%	 	42.1	%	 	41.0	%
	Depreciation	 	 	63	 	 	251	 	 	188	 	 	431	 	 	456	 
	 	 	
	 	
	 	
	 	
	 	
	 
	EBITDA	 	 	1,105	 	 	4,420	 	 	3,316	 	 	5,570	 	 	6,715	 
	as a % of revenues	 	 	25.3	%	 	25.3	%	 	25.3	%	 	27.5	%	 	29.1	%
	

Depreciation	
 	
 	

63	
 	
 	

251	
 	
 	

188	
 	
 	

431	
 	
 	

456	
 
	Amorization of Intangibles	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Operating Income	 	 	1,042	 	 	4,169	 	 	3,127	 	 	5,140	 	 	6,259	 
	as a % of revenues	 	 	23.9	%	 	23.9	%	 	23.9	%	 	25.4	%	 	27.1	%
	
exchange rate 1.9	
 	
 	

 	
 	
 	

 	
 	
 	

 	
 	
 	

 	
 	
 	

 	
 

69

 
 
 

Annex 2    
    

70

  

 
 

Annex 3    
    

Micro Medical Net Asset Target  

	In Pounds Sterling
 
	 	July
	 	August
	 	September
	 	October
	 	November
	 	December
	 	Average
	 	Sum of the

Averages
	 
	Net Assets	 	4,454,690	 	4,591,879	 	4,645,076	 	4,655,244	 	4,514,632	 	4,425,798	 	 	 	4,547,887	 
	 	 	
	 	
	 	
	 	
	 	
	 	
	 	 	 	 	 
	

Cash	
 	

458,671	
 	

647,120	
 	

666,681	
 	

704,509	
 	

684,994	
 	

1,284,530	
 	

 	
 	

741,084	
 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	3,806,802	 
	

New Building	
 	

3,553,671	
 	

3,554,446	
 	

3,556,487	
 	

3,556,487	
 	

3,465,797	
 	

3,469,535	
 	

 	
 	

3,526,071	
 
	Amberly Green—sold in December	 	383,482	 	383,482	 	383,482	 	383,482	 	383,482	 	—	 	 	 	319,569	 
	Depreciation—both buidlings	 	(126,224	)	(137,194	)	(147,810	)	(158,779	)	(183,309	)	(96,958	)	 	 	(141,712	)
	Loan—new building	 	(2,087,454	)	(2,061,144	)	(2,034,835	)	(2,008,526	)	(1,989,491	)	(1,955,907	)	 	 	(2,022,893	)
	Loan for Ambley Green	 	(72,230	)	(68,312	)	(64,501	)	(60,543	)	(65,371	)	—	 	 	 	(55,160	)
	

One-Time Adjustments for year-end entries:	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 	
 	

 	
 
	 	Back-out monthly Corporation Tax	 	(11,311	)	(11,311	)	(39,811	)	(39,811	)	0	 	—	 	 	 	(17,040	)
	 	Back-out Deferred Tax	 	47,108	 	47,108	 	47,108	 	47,108	 	64,859	 	111,184	 	 	 	60,746	 
	Deferred Tax	 	(111,184	)	(111,184	)	(111,184	)	(111,184	)	(111,184	)	(111,184	)	 	 	(111,184	)
	

Corporation Tax entry booked in December	
 	

(202,189	
)	

(202,189	
)	

(202,189	
)	

(202,189	
)	

(202,189	
)	

(202,189	
)	

 	
 	

(202,189	
)
	Average Micro Gas Loss over 6 mos.	 	(79,494	)	(79,494	)	(79,494	)	(79,494	)	(79,494	)	(79,494	)	 	 	(79,494	)
	Doubful accounts booked in December	 	(45,974	)	(45,974	)	(45,974	)	(45,974	)	(45,974	)	(45,974	)	 	 	(45,974	)
	 	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 
	Restated Net Assets	 	1,941,729	 	1,870,437	 	1,854,027	 	1,807,070	 	1,844,548	 	1,396,941	 	£1,785,792	 	1,785,792	 
	 	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 

71

QuickLinks

TABLE OF CONTENTS

Schedule 1 Completion arrangements

Schedule 2 Representations and Warranties

Schedule 3 Sellers' limitations on liability

Schedule 4 Tax Covenant

Schedule 5 Ownership of the Shares

Schedule 6 Basic information about the Company

Schedule 7 Basic information about the Subsidiaries and Associated Companies

Schedule 8 Property

PART A Relevant Properties

Schedule 9 Basis of Completion Accounts

Schedule 10 Form of Key Personnel Contracts

Schedule 11 Form of Escrow Agreement

Schedule 12 Form of IP Employment Amendment Agreement

Schedule 13 Form of MicroDirect Distributor Agreement

Annex 1

Annex 2

Annex 3

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00080-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00080-of-00352.parquet"}]]