-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Rsy5bIHUOnQSoUYGiX7Qo8pQOJEVso43YIXvo7+YTDL/5G9/LFWppW860sO9jMKA dAlgOw2q6ttXry3InexkIA== 0000927016-01-503874.txt : 20020411 0000927016-01-503874.hdr.sgml : 20020411 ACCESSION NUMBER: 0000927016-01-503874 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 6 CONFORMED PERIOD OF REPORT: 20011105 ITEM INFORMATION: Acquisition or disposition of assets ITEM INFORMATION: Financial statements and exhibits FILED AS OF DATE: 20011116 FILER: COMPANY DATA: COMPANY CONFORMED NAME: NMT MEDICAL INC CENTRAL INDEX KEY: 0001017259 STANDARD INDUSTRIAL CLASSIFICATION: SURGICAL & MEDICAL INSTRUMENTS & APPARATUS [3841] IRS NUMBER: 954090463 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 000-21001 FILM NUMBER: 1794039 BUSINESS ADDRESS: STREET 1: 27 WORMWOOD STREET CITY: BOSTON STATE: MA ZIP: 02210 BUSINESS PHONE: 6177370930 MAIL ADDRESS: STREET 1: 27 WORMWOOD STREET CITY: BOSTON STATE: MA ZIP: 02210 FORMER COMPANY: FORMER CONFORMED NAME: NITINOL MEDICAL TECHNOLOGIES INC DATE OF NAME CHANGE: 19960619 8-K 1 d8k.txt FORM 8K SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ---------------------- FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of Report (Date of earliest event reported): November 5, 2001 NMT Medical, Inc. - -------------------------------------------------------------------------------- (Exact name of registrant as specified in charter) Delaware 000-21001 95-4090463 - -------------------------------------------------------------------------------- (State or Other Juris- (Commission (IRS Employer diction of Incorporation) File Number) Identification No.) 27 Wormwood Street, Boston, Massachusetts 02210-1625 - -------------------------------------------------------------------------------- (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (617) 737-0930 --------------------------- N/A - -------------------------------------------------------------------------------- (Former name or former address, if changed since last report) Item 2. Acquisition or Disposition of Assets. ------------------------------------ On November 5, 2001, NMT Medical, Inc. (the "Company") completed its disposition of assets comprising the Company's vena cava filter product line (the "Product Line") to C.R. Bard, Inc. ("Bard"). Pursuant to an Asset Purchase Agreement, dated as of October 19, 2001 (the "Agreement"), between the Company and Bard, in exchange for the Product Line, the Company will receive $27 million in upfront cash payments, of which $8.5 million was paid at the closing of the transaction and $18.5 million will be paid on or about January 2, 2002. In addition, pursuant to the Agreement, the Company will receive up to an additional $7 million in cash upon the achievement by the Company of certain performance and delivery milestones. The Agreement contains customary representations, warranties, covenants and indemnification provisions on behalf of the Company, including indemnification by the Company for claims relating to rights to royalty payments. The Company and Bard also entered into a Royalty Agreement, dated as of October 19, 2001, as amended by Amendment No. 1 to Royalty Agreement, dated as of November 5, 2001 (as so amended, the "Royalty Agreement"), pursuant to which, the Company will receive ongoing royalty payments from Bard on sales of vena cava filter products. The Company will also continue to manufacture certain vena cava filter products for Bard for an interim period of time pursuant to a Transitional Manufacturing Agreement, dated as of November 5, 2001, between the Company and Bard. Bard has acted as the exclusive distributor of the Simon Nitinol Filter(R), a vena cava filter product, in the United States since 1992 and as a distributor internationally since 1995. With the proceeds from the sale, the Company repaid in full its senior subordinated debt to Whitney & Co. in the aggregate amount of approximately $4.5 million. In addition, the Company paid $2.25 million and issued 40,000 shares of its common stock to The Beth Israel Deaconess Medical Center ("Beth Israel") in exchange for an assignment of all of Beth Israel's rights with respect to the technology underlying the Product Line and a general release of claims. The Company and Dr. Morris Simon, a member of the Company's board of directors, have exchanged letters disputing, among other things, rights to royalty payments relating to the sale of vena cava filter products. The parties have agreed to attempt to resolve these disputes through mediation. If the parties are unable to successfully mediate their disputes, they have agreed to submit the matter to arbitration. The Company's press release, dated November 5, 2001, is attached hereto as Exhibit 99.1 and incorporated herein by reference. Item 7. Financial Statements, Pro Forma Financial Information and Exhibits. ------------------------------------------------------------------ (c) Exhibits Exhibit No. Description - ----------- ----------- 2.1* Asset Purchase Agreement, dated as of October 19, 2001, between the Company and Bard. 10.1* Royalty Agreement, dated as of October 19, 2001, between the Company and Bard. 10.2* Amendment No. 1 to Royalty Agreement, dated as of November 5, 2001, between the Company and Bard. 10.3* Transitional Manufacturing Agreement, dated as of November 5, 2001, between the Company and Bard. 99.1 Press Release, dated November 5, 2001, announcing sale of assets comprising the Company's vena cava filter product line to Bard. * Confidential treatment requested as to certain portions, which portions are omitted and filed separately with the Securities and Exchange Commission. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: November 16, 2001 NMT Medical, Inc. ----------------- (Registrant) By: /s/ Richard E. Davis ------------------------------------------ Name: Richard E. Davis Title: Vice President and Chief Financial Officer EXHIBIT INDEX Exhibit No. Description - ----------- ----------- 2.1* Asset Purchase Agreement, dated as of October 19, 2001, between the Company and Bard. 10.1* Royalty Agreement, dated as of October 19, 2001, between the Company and Bard. 10.2* Amendment No. 1 to Royalty Agreement, dated as of November 5, 2001, between the Company and Bard. 10.3* Transitional Manufacturing Agreement, dated as of November 5, 2001, between the Company and Bard. 99.1 Press Release, dated November 5, 2001, announcing sale of assets comprising the Company's vena cava filter product line to Bard. * Confidential treatment requested as to certain portions, which portions are omitted and filed separately with the Securities and Exchange Commission. EX-2.1 3 dex21.txt ASSET PURCHASE AGREEMENT - -------------------------------------------------------------------------------- Confidential Materials omitted and filed separately with the Securities and Exchange Commission. Asterisks denote omissions. - -------------------------------------------------------------------------------- Exhibit 2.1 - -------------------------------------------------------------------------------- ASSET PURCHASE AGREEMENT DATED AS OF OCTOBER 19, 2001 AMONG C.R. BARD, INC. AND NMT MEDICAL, INC. - -------------------------------------------------------------------------------- TABLE OF CONTENTS Page ARTICLE I. DEFINITIONS 1.1. DEFINITIONS...........................................................1 ARTICLE II. PURCHASE OF ASSETS 2.1. PURCHASE AND SALE.....................................................5 2.2. EXCLUDED ASSETS.......................................................7 2.3. ASSUMPTION OF LIABILITIES.............................................7 2.4. EXCLUDED LIABILITIES..................................................8 2.5. LICENSE OF 577 PATENT.................................................8 2.6. PRODUCTS LIABILITY....................................................9 ARTICLE III. PURCHASE PRICE AND CLOSING 3.1. CLOSING...............................................................9 3.2. INSTRUMENTS OF TRANSFER..............................................10 3.3. PURCHASE PRICE.......................................................10 ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF SELLER 4.1. DUE ORGANIZATION.....................................................11 4.2. AUTHORIZATION........................................................11 4.3. NO DEFAULT OR VIOLATION..............................................11 4.4. CONTRACTS AND COMMITMENTS............................................12 4.5. CONTRACTS AND COMMITMENTS; NO DEFAULT................................13 4.6. TITLE TO AND SUFFICIENCY OF ASSETS...................................13 4.7. MATTERS RELATING TO THE PRODUCT LINES AND THE ASSETS.................14 4.8. INSURANCE............................................................14 4.9. LITIGATION...........................................................15 4.10. LICENSES AND PERMITS; REGULATORY FILINGS; LEGAL COMPLIANCE..........15 4.11. DISTRIBUTION AGREEMENTS.............................................17 4.12. INTELLECTUAL PROPERTY RIGHTS........................................17 4.13. PRODUCT LINE DOCUMENTATION..........................................19 4.14. CERTIFICATIONS AND APPROVALS........................................19 4.15. ABSENCE OF MATERIAL CHANGES.........................................19 4.16. CERTAIN FINANCIAL INFORMATION.......................................19 ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER 5.1. DUE ORGANIZATION.....................................................20 5.2. AUTHORIZATION........................................................20 5.3. NO DEFAULT OR VIOLATION..............................................20 5.4. NO KNOWLEDGE OF MISREPRESENTATION OR OMISSION........................20 ARTICLE VI. COVENANTS OF THE PARTIES 6.1. ACCESS TO FACILITIES AND INFORMATION.................................20 6.2. DISCLOSURE SUPPLEMENTS...............................................21 6.3. CONDUCT OF BUSINESS..................................................21 6.4. LEGAL CONDITIONS TO THE ACQUISITION..................................22 ARTICLE VII. CONDITIONS PRECEDENT TO CLOSING 7.1. CONDITIONS TO EACH PARTY'S OBLIGATIONS UNDER THIS AGREEMENT..........22 7.2. CONDITIONS TO OBLIGATIONS OF BUYER...................................22 7.3. CONDITIONS TO OBLIGATIONS OF SELLER..................................24 ARTICLE VIII. POST-CLOSING MATTERS 8.1. COVENANT OF FURTHER ASSURANCES.......................................24 8.2. PAYMENT OF TAXES.....................................................25 8.3. CONFIDENTIALITY......................................................25 8.4. DEFENSE OF CLAIMS AND LITIGATION.....................................25 8.5. DELIVERY OF DOCUMENTS................................................26 8.6. MANUFACTURING SERVICES TO BUYER......................................26 8.7. SHARING OF DATA......................................................26 8.8. COVENANT NOT TO COMPETE; NON-SOLICITATION............................26 8.9. EMPLOYEES............................................................27 8.10. USE OF SELLER'S MARKINGS............................................28 8.11. HART-SCOTT-RODINO ACT...............................................28 8.12. ASSIGNMENT OF CERTAIN CONTRACTS.....................................28 ARTICLE IX. INDEMNIFICATION 9.1. INDEMNIFICATION......................................................28 9.2. PROCEDURE............................................................30 9.3. LIMITATION ON INDEMNIFICATION........................................30 9.4. EXCLUSIVE REMEDY.....................................................31 9.5. DISPUTE RESOLUTION...................................................31 ARTICLE X. MISCELLANEOUS 10.1. TERMINATION.........................................................33 10.2. EFFECT OF TERMINATION...............................................33 10.3. CONFIDENTIALITY UPON TERMINATION....................................33 10.4. SURVIVAL OF REPRESENTATIONS AND WARRANTIES..........................34 10.5. BROKERAGE...........................................................34 10.6. WAIVERS AND AMENDMENTS..............................................34 10.7. PERFORMANCE.........................................................34 10.8. ALLOCATION OF PURCHASE PRICE........................................35 10.9. NOTICES.............................................................35 10.10. EXPENSES...........................................................36 10.11. NO SOLICITATION....................................................36 10.12. PUBLICITY..........................................................36 10.13. ENTIRE AGREEMENT...................................................36 10.14. GOVERNING LAW......................................................36 10.15. INTERPRETATION.....................................................36 10.16. SEVERABILITY.......................................................37 10.17. EXHIBITS...........................................................37 -2- 10.18. COUNTERPARTS.......................................................37 10.19. NO ASSIGNMENT BY SELLER............................................37 10.20. WAIVER OF JURY TRIAL...............................................37 -3- INDEX OF DEFINED TERMS 577 License ............................................................... 8 577 Patent ................................................................ 8 Acquisition ............................................................... 1 Affected Parties .......................................................... 25 Affiliate ................................................................. 1 Agreement ................................................................. 1 Assets .................................................................... 1 Assigned Intellectual Property Rights ..................................... 5 Assumed Contracts ......................................................... 1 Assumed Liabilities ....................................................... 7 Business .................................................................. 1 Business Data ............................................................. 13 Business Material Adverse Effect .......................................... 2 Buyer ..................................................................... 1 Buyer Indemnified Parties: ................................................ 27 Buyer Products Liability: ................................................. 9 Closing ................................................................... 9 Closing Date .............................................................. 9 Competitive Products and Services ......................................... 25 Confidentiality, Assignment and Non-Competition Agreement ................. 17 Contracts ................................................................. 11 Damages: .................................................................. 27 Deductible ................................................................ 29 Disclosure Schedules ...................................................... 2 European Medical Device Directive ......................................... 2 Excluded Assets ........................................................... 2 Excluded Contracts ........................................................ 2 Excluded Liabilities ...................................................... 8 FDA ....................................................................... 2 FDA Correspondence ........................................................ 15 Field ..................................................................... 8 Governmental Authority .................................................... 2 HSR Act ................................................................... 3 Insider ................................................................... 3 Institute: ................................................................ 30 Intellectual Property Rights .............................................. 3 Inventory ................................................................. 7 Issued Patents ............................................................ 17 knowledge ................................................................. 3 Lien ...................................................................... 3 Litigation Matter ......................................................... 3 Machinery and Equipment ................................................... 6 Manufacturing Transition Date ............................................. 3 Marks ..................................................................... 3 NMT ....................................................................... 1 NMT Royalty Agreement ..................................................... 10 Other Permits ............................................................. 15 Parties ................................................................... 3 Patent Applications ....................................................... 17 Patent Rights ............................................................. 3 Permits: .................................................................. 15 Person .................................................................... 4 Product Line .............................................................. 4 Product Line Documentation ................................................ 18 Product Line Employees .................................................... 4 Product Permits ........................................................... 15 Product Warranty Claim .................................................... 4 Products .................................................................. 4 Purchase Price ............................................................ 9 RC ........................................................................ 4 Related Documents ......................................................... 4 Representatives: .......................................................... 30 Returns ................................................................... 4 RLF Opinion ............................................................... 19 RNF ....................................................................... 4 Rules: .................................................................... 30 Seller .................................................................... 1 Seller Indemnified Parties: ............................................... 27 Seller Products Liability: ................................................ 9 Seller's Markings ......................................................... 26 SNF ....................................................................... 4 subsidiaries .............................................................. 4 subsidiary ................................................................ 4 Tax ....................................................................... 5 Taxes ..................................................................... 5 Termination Date .......................................................... 31 Trade Dress: .............................................................. 7 Trade Secret .............................................................. 5 Transitional Manufacturing Agreement ...................................... 5 -4- ASSET PURCHASE AGREEMENT THIS ASSET PURCHASE AGREEMENT made this 19th day of October, 2001 by and among C.R. Bard, Inc., a New Jersey corporation ("Buyer"), NMT Medical, Inc., a Delaware corporation ("NMT" or the "Seller"). WHEREAS, Seller is engaged in the business of developing, manufacturing, distributing and/or selling certain Products (as more completely defined in Section 1.1 hereof); and WHEREAS, Buyer wishes to purchase from Seller, and Seller wishes to sell to Buyer, the Product Line and substantially all of the business, assets and properties that the Business comprises; and WHEREAS, for a transitional period following the Closing Date, Seller will continue to manufacture Products for Buyer pursuant to a Transitional Manufacturing Agreement to be executed at the Closing in the form attached hereto as Appendix A. NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the Parties agree as follows: ARTICLE I. DEFINITIONS 1.1. Definitions. In addition to the terms defined elsewhere in this Agreement, including the recitals, the following terms, when used herein, shall have the following meanings: (a)"Acquisition" shall mean the purchase of the Assets and Business and other transactions contemplated by this Agreement. (b) "Affiliate" shall mean a Person that directly, or indirectly through one or more intermediaries, controls or is controlled by, or is under common control with, the Person specified. (c) "Agreement", "this Agreement", "hereto", "hereof", "hereunder", "hereby", and similar expressions refer to this Agreement, including the schedules and exhibits attached hereto, and not any particular article, section, subsection or other subdivision hereof or thereof. (d) "Assets" shall mean all those assets, both tangible and intangible, to be transferred pursuant to this Agreement, as provided in Section 2.1 of this Agreement. (e) "Assumed Contracts" shall mean the specific contracts, licenses and agreements listed on Exhibit 1.1(e). (f) "Business" shall mean the business and operations carried out with respect to the Product Line or any component thereof, including, without limitation, development of Product Line processes and systems, research and development, regulatory approval process and permits, manufacturing, marketing and distribution to the extent that they relate to such Product Line and parts thereof and the conduct of clinical trials with respect thereto. (g) "Business Material Adverse Effect" means any change, effect or circumstance that (i) is materially adverse to the assets, business, financial condition or results of operations of the Business (other than changes that are the result of economic factors affecting the economy as a whole or changes that are the result of factors generally affecting the medical device industry), or (ii) materially impairs the ability of the Seller to consummate transactions contemplated by this Agreement; provided, however, that a "Business Material Adverse Effect" shall not include any adverse change, effect or circumstance (i) primarily arising out of or resulting primarily from actions contemplated by the Parties in connection with this Agreement, or (ii) that is primarily attributable to the announcement or performance of this Agreement or the transactions contemplated by this Agreement. (h) "Disclosure Schedules" shall mean the lists and other information delivered by Seller to Buyer in response to the requirements of Article IV. (i) "European Medical Device Directive" shall mean the directive setting forth the safety and other requirements with which medical products marketed in European Union countries must comply (93/42/EEC). (j) "Excluded Assets" shall mean the assets described in Section 2.2 as not being transferred to Buyer. (k) "Excluded Contracts" shall mean those contracts, leases and agreements listed on Exhibit 1.1(k) and all other contracts, leases and agreements of Seller other than the Assumed Contracts. (l) "FDA" shall mean the United States Food and Drug Administration. (m) "FDA Law" means any statute, regulation, judicial or administrative interpretation, guideline, point-to-consider, recommendation or standard international guidance relating to any FDA Regulated Product. "FDA Law" includes the Federal Food, Drug, and Cosmetic Act, 21 U.S.C. ss. 301 et seq., the FDA Modernization Act of 1997, Stand Alone Provisions, Pub. L. No. 105-115, 111 Stat. 2295 (1997), and equivalent statutes, regulations and guidances adopted by countries, international bodies and other jurisdictions, in addition to the United States, where Seller has facilities, does business, or directly or through others sells or offers for sale any FDA Regulated Product. (n) "FDA Regulated Product" means any product or component including any medical device, that is studied, used, held or offered for sale for human research or investigation or clinical use. (o) "Governmental Authority" shall mean any nation, territory or government, foreign or domestic, any state, local or other political subdivision thereof, and any bureau, tribunal, board, commission, department, agency or other entity exercising executive, legislative, judicial, regulatory or administrative functions of government, including all -2- taxing authorities. (p) "HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended. (q) "Insider" shall mean any officer or employee of Seller. (r) "Intellectual Property Rights" means all of the following throughout the world, to the extent that they have been used, are used or have been proposed to be used by or for Seller for the design, development, manufacture, operation, sale or use of Products or the Product Line, or relate to the Seller's conduct or proposed conduct of the Business: the Issued Patents and the Patent Applications, the Marks and the Trade Dress, all copyrights, all Trade Secrets, all applications or rights to apply for any of the foregoing, and all other industrial and intellectual property rights. (s) "knowledge" shall be defined as the actual knowledge of John Ahern, Richard Davis, Ann Kulis, Rob Carr, Carol Ryan, and Dennis Goodine. (t) "Lien" shall mean any interest, consensual or otherwise, in property, whether real, personal or mixed property or assets, tangible or intangible, securing an obligation owed to, or a claim by a third Person, or otherwise evidencing an interest of a Person other than the owner of the property, whether such interest is based on common law, statute or contract, and including, but not limited to, any security interest, security title or lien arising from a mortgage, recordation of abstract of judgment, deed of trust, deed to secure debt, encumbrance, restriction, charge, covenant, restriction, claim, exception, encroachment, easement, right of way, license, permit, incorporeal hereditament, pledge, conditional sale, option trust (constructive or otherwise) or trust receipt or a lease, consignment or bailment for security purposes and other title exceptions and encumbrances affecting the property (but not including mechanics', carriers', warehousemen's, vendors' or other similar liens arising in the ordinary course of the Business if and to the extent that Seller removes such liens by prompt payment of the applicable invoice for services rendered). (u) "Litigation Matter" shall mean any claim, investigation, arbitration, grievance, litigation, action, suit or proceeding, administrative or judicial, relating to any of the Assets or the Business (whether Seller is a plaintiff, defendant or otherwise), at law or in equity or otherwise, or before any Governmental Authority. (v) "Manufacturing Transition Date" shall mean the earlier of (i) the date on which Buyer accepts the last shipment of SNF Units manufactured by NMT and shipped to Buyer pursuant to Buyer's final Purchase Order submitted to NMT under the Transitional Manufacturing Agreement and (ii) December 31, 2002. (w) "Marks" shall have the meaning set forth in Section 4.12(a)(i). (x) "Parties" shall mean each of Seller and Buyer. (y) "Patent Rights" shall mean, to the extent related to the Business or the Assets, patents, patent applications and any patents issuing therefrom worldwide, together with any -3- extensions, registrations, confirmations, reissues, divisionals, continuations, continuations-in-part, reexamination certificates, substitutions or renewals, supplemental protection certificates, term extensions or certificates of inventions. The Issued Patents and the Patent Applications are included as part of the "Patent Rights." (z) "Person" shall mean an individual, corporation, partnership, limited partnership, limited liability company, unincorporated association, trust, joint venture or other organization or entity, including a Governmental Authority. (aa) "Product Line Employees" shall mean those employees and consultants of Seller engaged directly in the Business, including those engaged in the design, development, manufacture, quality assurance, distribution or sale of any Product. (bb) "Product Line" and "Products" shall mean the NMT Vena Cava Filter Line, including the SNF, the RNF, the RC and all other vena cava filter products and accessories now in existence or under development by or on behalf of NMT as of the Closing Date. Product Line and Products shall also include all other vena cava filter products and accessories designed, developed, manufactured, sold and/or distributed (at any time through the Manufacturing Transition Date). Product Line and Products shall also include any and all line extensions, modifications, improvements, additions, and successors to any of the foregoing, as well as all replacements for any of the foregoing, now in existence or under development by NMT as of the Closing Date or the Manufacturing Transition Date. (cc) "Product Warranty Claim" shall mean any claim relating to breach of a Product express or implied warranty, any claim relating to improper manufacturing or assembly of a Product, and any claim relating to non-conformity of a Product with specifications or regulatory requirements. (dd) "Related Documents" shall mean the Transitional Manufacturing Agreement, the Settlement Agreement and General Release, the NMT Royalty Agreement, and the instruments of transfer contemplated by Section 3.2. (ee) "Returns" means all reports, estimates, declarations of estimated Tax, information statements and returns relating to, or required to be filed in connection with, any Taxes, including information returns or reports with respect to backup withholding and other payments to third parties. (ff) "RNF" shall mean the Recovery Filter. (gg) "RC" shall mean the Recovery Cone. (hh) "SNF" shall mean the Simon Nitinol Filter. (ii) "subsidiary" shall mean each of, and "subsidiaries" collectively shall mean, as to any particular parent corporation, any corporation as to which more than 50% of the outstanding stock having ordinary voting rights or power at the time is owned or controlled, directly or indirectly, by such parent corporation. -4- (jj) "Tax" or "Taxes" means all taxes, however denominated, including any interest, penalties or other additions to tax that may become payable in respect thereof, imposed by any Governmental Authority, which taxes shall include, without limiting the generality of the foregoing, all income or profits taxes (including, but not limited to, federal income taxes and state income taxes), payroll and employee withholding taxes, unemployment insurance, social security taxes, sales and use taxes, ad valorem taxes, excise taxes, franchise taxes, gross receipts taxes, business license taxes, occupation taxes, real and personal property taxes, stamp taxes, environmental taxes, transfer taxes, workers' compensation, Pension Benefit Guaranty Corporation premiums and other governmental charges, and other obligations of the same or a similar nature to any of the foregoing, which any Person is required to pay, withhold or collect. (kk) "Trade Secret" shall mean, to the extent related to the Business or the Assets, all data and information owned by, used by or licensed to Seller and maintained in confidence by Seller, that has been used, is used or has been proposed to be used by or for Seller for the design, development, manufacture, operation, sale or use of Products or the Product Line or relating to the Business as currently conducted or as proposed to be conducted in Seller's business plan as disclosed to Buyer, including all related processes, methods, compounds, formulae, discoveries, developments, designs, techniques, know-how, specifications, inventions, customer and supplier lists, computer programs, and other scientific or technical data or information conceived, memorialized, developed and/or reduced to practice. Until such time as any particular patent has issued in accordance with the terms of a Patent Application or such Patent Application has been published, the term "Trade Secrets" shall be deemed to include all inventions claimed in such Patent Application. (ll) "Transitional Manufacturing Agreement" shall mean that certain transitional manufacturing agreement to be entered into between Seller and Buyer as of the Closing Date in the form set forth as Appendix A. ARTICLE II. PURCHASE OF ASSETS 2.1. Purchase and Sale. Upon and subject to the terms and conditions hereof, at the Closing (unless otherwise provided below), Seller shall sell, transfer and assign to Buyer, and Buyer shall purchase and acquire from Seller, all of Seller's right, title and interest in and to the assets and rights of every kind, nature and description and wherever located, real, personal and mixed, tangible and intangible, owned or licensed by Seller or in which Seller has an interest (other than the Excluded Assets) and which are now or hereafter (from the date hereof through the Manufacturing Transition Date) used or at any time have been used primarily in connection with the conduct of the Business, in each case free and clear of all Liens except for the Assumed Liabilities. Without limiting the generality of the foregoing, the Assets include the following, if applicable: (a) all Intellectual Property Rights, to the extent owned by Seller (the "Assigned Intellectual Property Rights"); -5- (b) all business records (including purchasing records, regulatory compliance records (including each Device Master File, all FDA Correspondence; CE Marking correspondence; FDA 510(k) premarket notifications and FDA premarket approvals; CE Marking certifications (to the extent transferable); submissions and reports to the FDA and to any European notified body; manuals and procedures for assuring compliance with FDA and CE Marking requirements; and all other records and materials necessary for the Business to comply with FDA and CE Marking requirements), risk management records, customer records, sales and marketing records, documents, correspondence, studies, reports, and all other books, ledgers, files, and records of every kind), tangible data, customer lists, vendor lists, service provider lists, promotional literature and advertising materials, catalogs, research material, technical information, blueprints, technology, technical designs, drawings, specifications and other Product development records owned or licensed by Seller or its subsidiaries and primarily relating to or used primarily in the Business on the Closing Date (in each case, whether such materials are evidenced in writing, electronically, or otherwise); it being understood and agreed that following the Closing, similar items related to or used in the Business but not used primarily in the Business shall be retained by Seller and made available to Buyer, in accordance with the terms of Section 8.7 hereof; (c) all sales promotion art-work and masters relating to the Product Line, whether or not currently used in sales promotion publications or product catalogs, together with all copies of all promotional materials, including catalogs, brochures, and photographs relating to the Product Line; (d) all Business Data; (e) all machinery, equipment and fixtures, including, by way of example and without limitation, all dies, jigs, and tooling, used or planned to be used in connection with the development, manufacture, distribution or sale of any Product, as set forth on Exhibit 2.1(e), and all computer programs and software owned or licensed by Seller and used primarily in connection with the development, manufacture, distribution or sale of the Product Line as listed on Exhibit 2.1(e), and all machinery and equipment, if any, enhanced or purchased by Seller between the Closing Date and the Manufacturing Transition Date pursuant to Section 9.3(a) of the Transitional Manufacturing Agreement (collectively, the "Machinery and Equipment"); (f) to the extent transferable, all Permits; (g) all patterns, plans, designs, research data, formulae and manufacturing processes, quality testing procedures, operating manuals, drawings, manuals, data, records, procedures and research and development records, compositions, drawings, specifications, improvements, proposals, technical and computer data, and related documentation owned or licensed by Seller and used primarily in the Business (including all Product Line Documentation), and all copies and tangible embodiments of the foregoing (in whatever form or medium), in each case relating primarily to the Business on the Closing Date; (h) all of Seller's right, title and interest in the distinctive features of the packaging primarily relating to or primarily used for the Products of the Business on the Closing Date -6- (the "Trade Dress"); (i) all income, royalties, damages and payments due or payable to Seller as of the Closing Date or thereafter relating to any of the Intellectual Property Rights (including damages and payments for past, present or future infringements or misappropriations thereof, the right to sue and recover for past infringements or misappropriations thereof, and any and all corresponding rights that, now or hereafter, may be secured throughout the world); (j) all claims, causes of action, choses in action, rights of recovery, and rights of set-off of any kind (except to the extent related to Excluded Assets or Excluded Liabilities); (k) all rights under all Assumed Contracts; (l) all rights of Seller in and to paragraph 5 of the agreement specified on Exhibit 2.1(l) hereof; (m) all other assets of Seller and its subsidiaries (whether real or personal, tangible or intangible, absolute or contingent) related primarily to or used primarily in the Business, including all of the goodwill of the Business. 2.2. Excluded Assets. The Excluded Assets shall be all assets of Seller other than the Assets, including without limitation the following: (a) cash, real estate, leaseholds of real property, securities, Tax prepayments or other prepaid items that may be deemed to relate to the Business; (b)(i) all finished goods inventory of the Business, (ii) all work in process of the Business, (iii) all raw materials of the Business, and (iv) all packaging materials to be used primarily in connection with and to support the Business (the "Inventory"); (c) all accounts receivable of Seller relating to the Business; (d) all rights of the Seller arising under the Excluded Contracts; (e) the NMT trademark and any derivation thereof; and (f) the 577 Patent (as defined in Section 2.5). 2.3. Assumption of Liabilities. Buyer hereby agrees to assume and perform the Assumed Liabilities. Buyer shall be primarily responsible for payment and performance of, and agrees to pay and perform, and be solely responsible for all of (and Seller shall have no responsibility with respect to any of) the Assumed Liabilities. The "Assumed Liabilities" shall mean: (a) all liabilities of Seller arising under the Assumed Contracts after the Closing Date (other than liabilities or obligations attributable to any failure by Seller to comply with the terms thereof or liabilities which are not apparent on the face of the Assumed Contracts and which were not disclosed to Buyer in the Disclosure Schedules); -7- (b) all obligations of Seller arising under paragraph 5 of the agreement specified on Exhibit 2.1(l) hereof; (c) all Buyer Products Liability; and (d) all other liabilities related to the conduct of the Business from and after the Closing Date by Buyer or any successor, except to the extent such liabilities are the responsibility of Seller pursuant to the terms of this Agreement. 2.4. Excluded Liabilities. Seller shall be primarily responsible for payment and performance of, and agrees to pay and perform, and be solely responsible for all (and Buyer shall have no responsibility with respect to any) obligations relating to the Business or the Assets other than the Assumed Liabilities (the "Excluded Liabilities"). Without limiting the generality of the foregoing, Seller shall be primarily responsible for payment and performance of, and agrees to pay and perform, and be solely responsible for all of (and Buyer shall have no responsibility with respect to any of) the following: (a) all liabilities related to the payment of wages, salary and the provision of benefits to Product Line Employees; (b) all Seller Products Liability; (c) all liabilities in any way relating to Excluded Contracts; and (d) all other liabilities related to the conduct of the Business up to and including the Closing (including all obligations with respect to Taxes). 2.5. License of 577 Patent. (a) Seller is the owner of certain patent rights arising from U.S. Patent No. 5,776,162 "vessel implantable shape memory appliance with superelastic hinged joint" (the "577 Patent"). Upon and subject to the terms and conditions hereof, effective at the Closing Seller hereby grants and Buyer hereby accepts a worldwide, royalty-free, fully paid-up, perpetual license ("577 License") to develop, make, have made, use, sell, offer to sell, have sold, lease and import any product or part thereof, device, method or service, the manufacture, use, or sale of which is covered by a valid claim of the 577 Patent. The 577 License shall be exclusive in the field of vena cava filters and accessories thereof (the "Field"), even with respect to Seller. The 577 License includes the right to sublicense the 577 Patent to any person for use within the Field. (b) Buyer shall have the right in its sole discretion to enforce its rights in the 577 Patent against any third party for actual, alleged or prospective infringement arising from activities solely in the Field, and Seller shall have the right in its sole discretion to enforce its rights in the 577 Patent against any third party for actual, alleged or prospective infringement arising from activities outside of the Field. The enforcing Party shall have the right to initiate, maintain and settle any such enforcement action at its sole expense, for its sole benefit, and under its sole control. The non-enforcing Party shall cooperate in any such action at the enforcing Party's reasonable request and expense, and, if the non-enforcing -8- Party is necessary in order to initiate or maintain such action by the enforcing Party, the non-enforcing Party agrees to be joined in such action. 2.6. Products Liability. Buyer and Seller have agreed upon the following to clarify any ambiguities that might otherwise exist with respect to their respective liabilities and obligations relating to the Products. The provisions of this Section 2.6 shall supersede any and all other provisions of this Agreement to the extent referring to the subject matter hereof: Seller has either manufactured or caused a third party to manufacture the Products before the Closing Date. From the Closing Date to the Manufacturing Transition Date, Seller will continue to manufacture Products for Buyer under the Transitional Manufacturing Agreement. The Parties have agreed that (i) Buyer shall be liable for any and all Product Warranty Claims and all claims asserted by any person for the death of or injury to any person or any damage to or loss of property or other products liability arising out of or related to Products manufactured by Buyer after the Manufacturing Transition Date or which are work-in-process Inventory as of such Manufacturing Transition Date, and the manufacture of which are completed by Buyer after such Manufacturing Transition Date (regardless of when the alleged defect giving rise to the liability occurs) (the "Buyer Products Liability"), and (ii) Seller shall be liable for any and all Product Warranty Claims and all claims asserted by any person for the death of or injury to any person or any damage to or loss of property or other products liability arising out of or related to Products manufactured by or for Seller prior to the Manufacturing Transition Date for such Product or which are finished goods inventory of Seller as of such Manufacturing Transition Date and are thereafter sold to Buyer (regardless of when the injury occurs or when the claim is asserted) (the "Seller Products Liability"). For purposes of this Section 2.6 only, Inventory shall be considered finished goods at such time as it has been sterilized and packaged and has passed its final quality assurance examination in the ordinary course of the Business, consistent with past custom and practice, and will be considered work-in-process prior to such time. ARTICLE III. PURCHASE PRICE AND CLOSING 3.1. Closing. The closing of the purchase and sale of the Assets (the "Closing") shall be held at 10:00 a.m. at the offices of Foley, Hoag & Eliot, One Post Office Square, Boston, Massachusetts 02109 on a date specified by Buyer at least three business days prior to such date. The date of such Closing shall be as soon as practicable after conditions to the closing of the Acquisition have been fulfilled and the last of all required waiting periods under any applicable governmental approvals have expired, or at such other place, date or time as Buyer and Seller may mutually agree upon in writing (the "Closing Date"). 3.2. Instruments of Transfer. The transfer of the Assets to Buyer and assumption of Assumed Liabilities by Buyer at the Closing shall be effected by the delivery of a Bill of Sale and an Assumption Agreement in substantially the forms attached hereto as Appendix B and Appendix C, respectively. 3.3. Purchase Price. Subject to the other provisions of this Agreement, Buyer shall pay to Seller, for the transfer of the Assets, an aggregate purchase price (the "Purchase Price") consisting of (i) the Cash Purchase Price, as described below, plus (ii) the Royalty Payments, as -9- described below, plus (iii) the assumption of the Assumed Liabilities. (a) The Cash Purchase Price shall be payable as follows: (i) Eight million five hundred thousand dollars ($8,500,000) shall be payable on the Closing Date in immediately available funds to the accounts specified by Seller. (ii) Eighteen million five hundred thousand dollars ($18, 500,000) shall be payable on January 1, 2002. (iii) Four million dollars ($4 million) shall be payable on the earlier of (a) the date on which the Machinery and Equipment is installed and successfully tested after being delivered to the Buyer-designated facility pursuant to Section 9.4(b) of the Transitional Manufacturing Agreement, or (b) December 31, 2002, but only if: (A) Seller shall have fulfilled in all material respects all of its supply commitments under the Transitional Manufacturing Agreement; and (B) Seller shall have delivered the Product Line Documentation as required by Section 4.13 hereof; and (C) Seller shall have complied in all material respects with its obligations under Sections 9.2, 9.3 and 9.4 of the Transitional Manufacturing Agreement (to the extent that such obligations can reasonably be performed on or before December 31, 2002). If Seller shall have (i) failed to deliver the Product Line Documentation to Buyer by December 15, 2001, as required by Section 4.13 hereof, (ii) failed to complete the requirements set forth in Section 9.3(a)(1) of the Transitional Manufacturing Agreement by [**], or (iii) (ii) failed to complete the requirements set forth in Section 9.3(a)(2) of the Transitional Manufacturing Agreement by [**], the date on which Buyer would otherwise be required to pay the portion of the Purchase Price pursuant to this Section 3.3(a)(iii) shall be delayed for a number of days that is equal to (x) the number of days beyond December 15, 2001 that NMT shall have failed to deliver the Product Line Documentation plus (y) the number of days beyond [**] that Seller shall have failed to complete in all material respects the requirements set forth in Section 9.3(a)(1) of the Transitional Manufacturing Agreement plus (z) the number of days beyond [**] that Seller shall have failed to complete in all material respects the requirements set forth in Section 9.3(a)(2) of the Transitional Manufacturing Agreement. (iv) Three million dollars ($3 million) shall be payable upon Buyer's receipt of the FDA 510(k) premarket approval to permit commercial sale and use of the RNF Product in the United States. (b) Buyer also agrees to make royalty payments ("Royalty Payments") pursuant to a separate royalty agreement with Seller executed and delivered simultaneously with the execution and delivery of this Agreement ("NMT Royalty Agreement"). -10- ARTICLE IV. REPRESENTATIONS AND WARRANTIES OF SELLER Seller further represents and warrants to Buyer that, except as specifically disclosed on the Disclosure Schedules: 4.1. Due Organization. Seller is a corporation duly organized, validly existing and in good standing under the laws of the State of Delaware. Seller has corporate power to own its properties and to conduct its business as currently owned and conducted and to execute, deliver and perform this Agreement. 4.2. Authorization. Subject to receipt of approval under the HSR Act, Seller has the full legal right, power and authority to enter into and perform the transactions contemplated by this Agreement, without need for any consent, approval, authorization, license or order of, or notice to or filing with, any Governmental Authority or other Person, except where the failure to obtain such would not have a Business Material Adverse Effect. The execution, delivery and performance of this Agreement and the documents contemplated hereby by Seller and the consummation by Seller of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action. This Agreement and the Related Documents evidence, or upon their execution will evidence, the legal, valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms. This Agreement has been duly executed and delivered by Seller and, as of the Closing Date, each of the Related Documents to which Seller is a party will have been duly and validly executed and delivered by Seller. 4.3. No Default or Violation. The execution, delivery and performance of this Agreement by Seller and the consummation by Seller of the transactions contemplated hereby (a) do not, and will not, conflict with any provision of the corporate charter or By-Laws of the Seller, (b) do not, and will not, violate any law, regulation, order, judgment or decree to which Seller or any of its properties is subject and (c) do not, and will not, violate or result in a breach, default or acceleration of any obligation under any indenture, mortgage, lease, license, agreement or instrument to which Seller is a party or by which Seller or its property are bound, other than breaches, defaults or accelerations which would not have a Business Material Adverse Effect. 4.4. Contracts and Commitments. To the extent the same relate primarily to the Business or any Assets, or could give rise to a claim against the Business or any Assets, attached as Section 4.4 to the Disclosure Schedule is a list of the following (each, a "Contract" and, collectively, the "Contracts"): (a) All contracts, agreements, understandings, arrangements or commitments, written or oral, between Seller and (i) any Insiders or (ii) any corporation or other entity owned or controlled by any Insider or any member of any Insider's family. (b) All outstanding purchase orders and purchase commitments of Seller for $10,000 or more and all other outstanding purchase orders and purchase commitments of Seller which are not cancelable by Seller without penalty upon 30 days' or less notice; (c) All contracts, agreements, understandings, arrangements and commitments, -11- written or oral, relating to the marketing, promotion, manufacturing or distribution of Seller's products, processes and services the value of the obligation or rights of Seller under which exceed $10,000; (d) All contracts, agreements, understandings, arrangements and commitments, written or oral, relating in any manner to research and development conducted or to be conducted by or on behalf of Seller, including clinical trial and testing agreements; (e) All agreements pursuant to which Seller licenses or has otherwise obtained from another Person any right to use any of the Intellectual Property Rights and all agreements pursuant to which Seller has licensed or otherwise assigned or transferred to another Person any right to any of the Intellectual Property Rights; all confidentiality and nondisclosure agreements, assignment of rights agreements and non-competition agreements and covenants under which Seller or any of its officers, directors, or employees is obligated which relate in any manner to the Business or the Assets and any agreement restricting Seller from carrying on the Business anywhere in the world; (f) Any lease of personal property involving aggregate payments of $10,000 or more, or having a term in excess of one year, to which Seller is a party, including without limitation, any lease intended as security, any leveraged lease transaction under which Seller is an owner participant and any vendor arrangement or conditional sales agreement to which Seller is a party; (g) Any contract or agreement of Seller to make any capital expenditure or commitment for additions to property, plant or equipment in excess of $10,000 individually; any loan agreements or other agreements relating to debt obligations for borrowed money and any guarantees of or agreements to acquire any debt obligation of any Person and any agreement relating to a loan made by Seller to any Person; (h) All agreements relating to the settlement of any Litigation Matter executed after January 1, 1998 or currently in effect; (i) All other contracts, agreements, commitments, understandings and arrangements, written or oral, of Seller involving the payment of $10,000 or more by which it or its properties, rights or Assets are bound or that relate to the Business that are not otherwise disclosed herein; and (j) A description of all negotiations currently in process or contemplated with any third Person relating to any contract, agreement, commitment, understanding or arrangement of any type referred to in this Section 4.4, the value of the rights or obligations under which are expected to exceed $10,000. 4.5. Contracts and Commitments; No Default. (a) Seller has made available to Buyer true, correct and complete copies of all Contracts. (b) All Contracts are valid and in full force and effect, enforceable against Seller in -12- accordance with their respective terms. (c) All Assumed Contracts and agreements otherwise relating to the Assumed Liabilities were entered into by Seller in the normal, usual and ordinary course of the Business, none of them is in excess of the normal, ordinary and usual requirements of the Business and no other party thereto has asserted any right of defense, setoff or counterclaim with respect to any amount due or becoming due thereunder to Buyer after the Closing arising from events which preceded the Closing Date. (d) Seller is not in default in any material respect in the performance of any of its obligations under any Assumed Contract, or agreement otherwise relating to an Assumed Liability; no default has occurred which (whether with or without notice, lapse in time, or both, or the happening or the occurrence of any other event) would constitute an event of default by Seller thereunder; to Seller's knowledge no other parties thereto are in default thereunder; and to the Seller's knowledge there has not occurred any event or condition which (whether with or without notice, lapse of time, or both) constitutes a basis of force majeure or other claim of excusable delay or nonperformance by any Person under any such agreement. No written (or to Seller's knowledge, oral) notice has been received by Seller claiming any such default by Seller or indicating the intention of any other party thereto to amend, modify, rescind or terminate any such agreement, and Seller has not waived any material right under or with respect to any such agreement. 4.6. Title to and Sufficiency of Assets. Seller has the full right to sell, transfer, and assign all of the Assets to Buyer, and has good and marketable title thereto, free and clear of all Liens except for the Assumed Liabilities. Following the Closing, Buyer will be the lawful owner of, and have good title to, the Assets, free and clear of all Liens except for the Assumed Liabilities. The Assets include all of the assets and properties necessary for, and all of the assets and properties used by Seller primarily in, the design, development, marketing, production, upgrade, revision, maintenance, licensing or manufacture of the Product Line, as the Seller has conducted the Business as of the Closing Date. None of the Assets is in the possession, custody or control of any Person or entity other than the Seller except as detailed in Section 4.7(a)(ii) of the Disclosure Schedule. The tangible Assets (including the Machinery and Equipment) are in good operating condition and repair (ordinary wear and tear excepted), are not in need of any repair or maintenance (other than normal and routine repair and maintenance), are suitable and appropriate for the use thereof made and proposed to be made by the Seller in the Business, and will be in the same condition on the Closing Date. 4.7. Matters Relating to the Product Lines and the Assets. (a) Attached as Section 4.7(a) of the Disclosure Schedule is a true, correct and complete list of the following (the "Business Data"): (i) Any sole sources of supply for any raw material, supply or component part required in connection with the Business with respect to which practical alternative sources of supply are not available on comparable terms and conditions, indicating the contractual arrangements for continued supply from each such firm. -13- (ii) All locations at which Assets are located (including locations owned or controlled by third parties). (iii) A purchase item file, including names and addresses of all suppliers, vendors and subcontractors, for all items currently used in Products. (b) Attached as Section 4.7(b) of the Disclosure Schedule is a list of all machinery, equipment, computer programs and software owned or licensed by Seller and used in connection with the development, manufacture, distribution or sale of any Product, in each case which is primarily used by Seller for purposes unrelated to the Product Line and is therefore not included in the Assets. (c) With respect to any raw material, supply or component part for which Seller relies on a single source of supply, Seller has no reason to believe that, after the Closing, Buyer would not be able to obtain such item(s) from the sole source supplier(s) on comparable terms and in reasonably sufficient amounts to conduct the Business in the ordinary course. 4.8. Insurance. Attached as Section 4.8 to the Disclosure Schedule is a true, correct and complete list and brief description of all insurance policies and bonds and self-insurance arrangements currently in force that cover or purport to cover risks or losses associated with the Assets or Business. Seller has made available to Buyer true, correct and complete copies of all items included in such list. 4.9. Litigation. Attached as Section 4.9 to the Disclosure Schedule is a true, correct and complete list and brief description of: (a) All pending or, to Seller's knowledge, threatened Litigation Matters; and (b) All (1) product liability claims with respect to the Product Lines made against Seller, in each case in the period from 1998 to the present, and (2) warranty and service obligations outstanding with respect to Products as of the date hereof. (c) Warranty and Other Claims. The Seller's FDA Complaint Log System relating to the Business has been made available for review by Buyer and contains complete and correct information about all Product Line items returned to Seller because of warranty or other problems. The Seller's records relating to credits and allowances made with respect to Products have been made available for review by Buyer and are true and correct in all material respects. The Seller's Product Service Log System relating to the Business has been made available for review by Buyer and contains complete and correct information in all material respects about all repairs or modifications performed by Seller or any other Person or entity with respect to the Product Line because of warranty or other claims concerning defects in such goods. The Seller maintains no other records of warranty or other Product defect claims other than its FDA Complaint Log System and its Product Service Log System. Since January 1, 1998, Seller has not been a defendant in any Litigation Matter involving product liability or warranty claims and since such date, to the knowledge of Seller, no such Litigation Matter has been threatened in writing. 4.10. Licenses and Permits; Regulatory Filings; Legal Compliance. -14- (a) Attached as Section 4.10(a) to the Disclosure Schedule is a true, correct and complete list of: (i) all licenses, permits, orders, franchises (other than the Patent Rights), certificates, and other governmental authorizations, consents, rights, concurrences and approvals issued by any federal, state, local or foreign governmental or regulatory authority or organization that are material to or primarily relate to the conduct of the Business as now conducted, including all CE Marking certifications, FDA 510(k) premarket notifications, FDA premarket approvals, and other FDA authorizations relating to the Business (the "Permits"). (ii) To the extent not listed pursuant to Section 4.10(a)(i), all of Seller's applications, registrations, approvals and filings with, and other submissions and other correspondence relating to the Business or any Assets to or from, the FDA, any state counterpart and any European notified body, and, with respect to FDA filings and submissions, identifying the type of the filing or submission (whether under the FDA 510(k) procedure, the pre-market approval process or otherwise), including all warning letters, all correspondence relating to clinical activities, all responses to FDA audits, all registration documentation and all device listing documentation (collectively, the "FDA Correspondence"). To the extent that routine FDA Correspondence is too voluminous to list, the location of such correspondence may be provided on the Disclosure Schedule. (b) All the Permits relating to the manufacture and sale of the Products (the "Product Permits") are valid and in full force and effect and all information submitted to the applicable Governmental Authority in order to obtain each such Permit was true, accurate and complete when submitted, and Seller knows of no impediment to its renewal. Seller and the operations of the Business are in compliance with the respective requirements, conditions and provisions of the Product Permits and Seller has not been informed in writing (or, to Seller's knowledge, orally) by (i) any Governmental Authority or (ii) any lawyer or consultant (knowledgeable in the relevant field) of Seller of any deficiency with respect to any Product Permit. No proceeding is pending or, to Seller's knowledge, threatened to revoke or amend any of such Product Permits nor are there facts or circumstances of which Seller is aware which would indicate that a deficiency is reasonably likely to be asserted by any Governmental Authority with respect to any of the Product Permits. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not result in a modification, impairment, revocation, suspension or limitation of any Product Permit. No Product Permit by its terms requires the consent of its issuing authority in order to remain in full force and effect after the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby. (c) All Permits other than the Product Permits (the "Other Permits") are valid and in full force and effect, except where the failure to be valid or in full force and effect would not have a Business Material Adverse Effect, and all information submitted to the applicable Governmental Authority in order to obtain each Other Permit was true, accurate and complete in all material respects when submitted, and Seller knows of no impediment to its renewal. Seller and the operations of the Business are in compliance with the respective requirements, conditions and provisions of the Other Permits except where the failure to be -15- in compliance would not have a Business Material Adverse Effect, and Seller has not been informed in writing (or, to Seller's knowledge, orally) by (i) any Governmental Authority or (ii) any lawyer or consultant (knowledgeable in the relevant field) of Seller of any material deficiency with respect to any Other Permit. No proceeding is pending or, to Seller's knowledge, threatened to revoke or amend any of such Other Permits nor are there facts or circumstances of which Seller is aware which would indicate that a deficiency is reasonably likely to be asserted by any Governmental Authority with respect to any of the Other Permits. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not result in a modification, impairment, revocation, suspension or limitation of any Other Permit, except where the modification, impairment, revocation, suspension or limitation would not have a Business Material Adverse Effect. No Other Permit by its terms requires the consent of its issuing authority in order to remain in full force and effect after the execution and delivery of this Agreement or the consummation of the transactions contemplated hereby, except where the failure to obtain such consent would not have a Business Material Adverse Effect. (d) Seller has duly complied in all material respects with the FDA Law, the European Medical Device Directive, and all applicable state, local and foreign laws and directives (including any regulations thereunder) relating to the operation of its business or the development, manufacture, sale or distribution of the Product Line. No proceeding has been brought or, to Seller's knowledge, is threatened under said Act or any of said state, local or foreign laws or directives, with respect to any Product. There have been no inspections by the FDA of the Business or the operations or facilities currently or previously occupied by Seller. There have been no FDA recalls with respect to any Product. (e) Seller has duly complied in all material respects with all other applicable laws and regulations of Federal, state and local governments relating to the operation of the Business or the development, manufacture, distribution or sale of the Product Lines. Seller has duly complied in all material respects with all applicable laws and regulations relating to Product development and distribution of the governments of the countries in which the Product Lines are distributed. 4.11. Distribution Agreements. Except as set forth on Section 4.11 of the Disclosure Schedule, Seller is a not a party to any contract, agreement, understanding, arrangement or commitment with any dealer, distributor or other Person relating to the sale, distribution or marketing of any Product, other than its distribution agreement with Buyer and its international distribution agreement with an affiliate of the Buyer. 4.12. Intellectual Property Rights. (a) To the extent the same relate to the Business or Assets, attached as Section 4.12(a) to the Disclosure Schedule is the following: (i) List of all trademarks, service marks and trade names, including all registrations and applications with respect thereto, both domestic or foreign (collectively, the "Marks"). -16- (ii) List of all copyright registrations. (iii) List of all United States and foreign patents issued to Seller or any assignor of Seller, the application serial numbers and the filing date and issue date of each such patent (collectively, the "Issued Patents"), and all applications for patents filed by Seller or any assignor of Seller, including the title, filing date and serial number of each such application (collectively, the "Patent Applications"). (iv) List and description of all material Trade Secrets (if any). (v) A copy of the form of confidentiality, assignment and non-competition agreement (collectively, "Confidentiality, Assignment and Non-Competition Agreement") which Seller has entered into with its employees or consultants with respect to Seller's Intellectual Property Rights. (b) Seller owns and holds, primarily, all right, title and interest in the Assigned Intellectual Property Rights and the 577 Patent, and has the exclusive right to use, sell, license, sublicense, or dispose of, and has the exclusive right to bring action for the infringement of the Assigned Intellectual Property Rights and the 577 Patent. Seller's conduct of the Business prior to the Closing Date does not, and Buyer's conduct of the Business (to the extent Buyer conducts the business as it was conducted by Seller prior to the Closing Date) after the Closing Date will not, infringe any rights of any other Person (including, with respect to Buyer's conduct of the Business, Seller) or require any payment of any kind by Buyer to any such Person. Seller has received no notice of any such infringement or alleged infringement prior to the Closing Date. Pursuant to this Agreement, Seller will transfer to Buyer all intellectual property rights necessary for the manufacture, sale and distribution of Products and the conduct of the Business, as conducted by Seller prior to the Closing Date. (c) Seller is not obligated to make any payments to any third Person with respect to the Assigned Intellectual Property Rights or the 577 Patent, whether by way of royalties, fees or otherwise (except for maintenance and renewal fees payable to Governmental Authorities). (d) The Marks are the only trademarks, service marks, trade names and registered copyrights used by Seller in the Business. To Seller's knowledge, no Person has infringed any of the Marks. (e) Seller has the right to use (and to permit others to use) all Trade Secrets. Seller has no knowledge of any legal or equitable claims of any other Person with respect to the Trade Secrets. The Trade Secrets are not to Seller's knowledge part of public knowledge or literature nor is Seller aware that they have been used, divulged, or appropriated for the benefit of any other Person or to the detriment of Seller. (f) Seller has used reasonable efforts to protect the confidentiality of all material Trade Secrets, including entering into Confidentiality, Assignment and Non-Competition Agreements, substantially similar to those described on Section 4.12(a)(v) of the Disclosure Schedule hereto, with all employees having access to Business confidential information -17- requiring them not to disclose such information. To Seller's knowledge, no Person is in breach of any such Confidentiality Agreement in any respect that could adversely affect the Intellectual Property Rights or Seller's rights therein. (g) Seller has received no notice from any person alleging that any of the Issued Patents are invalid and Seller has received no opinions regarding the Issued Patents that have not been disclosed in the Disclosure Schedules. (h) The Intellectual Property Rights are freely transferable by Seller without the consent of or notice to any third party. The Seller's assignment of the Intellectual Property Rights to Buyer hereunder, will not adversely affect the rights or claimed rights of, or result in the payment of any royalty or consideration to, any third party. (i) The computer software portion of the Machinery and Equipment is freely transferable by Seller without the consent of or notice to any third party. Neither the Seller's transfer, licensing or sublicensing of such software to Buyer hereunder, nor the Buyer's use of such software after such transfer, licensing or sublicensing, will infringe on or otherwise adversely affect the rights or claimed rights of, or result in the payment of any royalty or consideration to, any third party. (j) Each of the employees and consultants listed on Section 4.12(j) of the Disclosure Schedule has executed the Confidentiality, Assignment and Non-Competition Agreement. Such list includes all of Sellers current Product Line Employees. Seller is not aware of any former Product Line Employee whose employment or consultancy terminated within the past year who did not execute a Confidentiality, Assignment and Non-Competition Agreement. 4.13. Product Line Documentation. All specifications, process descriptions and other technical data (including chemical and alloy formulations, design specifications, manufacturing process parameters and manufacturing and quality testing protocols) necessary for, or used by Seller in, the complete manufacture and quality assurance testing of the Products (the "Product Line Documentation") will be in writing and delivered to Buyer on the Closing Date as part of the Assets or, if not available as of the Closing Date, by no later than December 15, 2001. The Product Line Documentation will be current, accurate, and sufficient in detail and content to identify and explain the designs, concepts and processes described therein and to permit a reasonably skilled person to develop, manufacture, and repair the Products after the Closing Date without requiring assistance or information from Seller. 4.14. Certifications and Approvals. The SNF Product, the RNF Product and the RC Product have been issued the certifications and approvals listed on Section 4.14 of the Disclosure Schedule and all of such certifications and approvals are currently in full force and effect. 4.15. Absence of Material Changes. Since December 31, 2000, there has not been any Business Material Adverse Effect or any event or circumstance that might reasonably be expected to result in a Business Material Adverse Effect, except as specifically described in the financial statement notes or the management's discussion and analysis sections of Seller's quarterly reports on Form 10-Q filed with the Securities and Exchange Commission prior to the date of this Agreement. -18- 4.16. Certain Financial InformationThe financial information contained in the opinion Richards, Layton & Finger P.A., dated October 17, 2001 (the "RLF Opinion"), was either (a) derived from the historical financial information contained in the Seller's audited and unaudited financial statements prepared and filed in connection with the Seller's periodic filings made pursuant to Sections 13 and 15 of the Securities Exchange Act of 1934, as amended, which financial statements present fairly, in all material respects, the financial position of Seller as of and at the respective dates indicated, or (b) prepared by the Seller in good faith. The Seller reasonably believes that the financial information referred to in clause (b) above is true and correct in all material respects on and as of the date of the RLF Opinion. ARTICLE V. REPRESENTATIONS AND WARRANTIES OF BUYER Buyer represents and warrants to Seller as follows: 5.1. Due Organization. Buyer is a corporation duly organized, validly existing and in good standing under the laws of the State of New Jersey. Buyer has corporate power to own its properties and to conduct its business as currently owned and conducted and to execute, deliver and perform this Agreement. 5.2. Authorization. Subject to receipt of approval under the HSR Act, Buyer has the full legal right, power and authority to enter into and perform the transactions contemplated by this Agreement, without need for any consent, approval, authorization, license or order of, or notice to, any court, Governmental Authority or other Person. The execution, delivery and performance of this Agreement and the documents contemplated hereby by Buyer and the consummation by Buyer of the transactions contemplated hereby and thereby have been duly authorized by all necessary corporate action of Buyer. This Agreement and the Related Documents evidence the legal, valid and binding obligations of Buyer, enforceable against Buyer in accordance with their respective terms. This Agreement has been duly executed and delivered by Buyer and, as of the Closing Date, each of the Related Documents to which Buyer is a party will have been duly and validly executed and delivered by Buyer. 5.3. No Default or Violation. The execution, delivery and performance of this Agreement by Buyer and the consummation by Buyer of the transactions contemplated hereby do not, and will not, conflict with any provision of the corporate charter or By-Laws of Buyer, and do not, and will not, violate any law, regulation, order, judgment or decree to which Buyer or any of its properties is subject. 5.4. No Knowledge of Misrepresentation or Omission. The Buyer has no knowledge that any of the representations and warranties of the Seller in this Agreement are not true and correct, and the Buyer has no knowledge of any errors in, or omissions from, the Disclosure Schedules. ARTICLE VI. COVENANTS OF THE PARTIES 6.1. Access to Facilities and Information. Between the date of this Agreement and the Closing, upon three business days' prior notice Seller shall grant Buyer and its representatives -19- access at reasonable times to the Business's properties, books, records, officers, employees and agents, shall permit Buyer to conduct a physical inventory of the Assets, shall permit Buyer to confirm with suppliers to the Business the title to any Assets in such suppliers' possession, and shall use its commercially reasonable efforts to furnish to Buyer all such information concerning the Business as Buyer or its representatives may reasonably request. 6.2. Disclosure Supplements. At the Closing, Seller will promptly supplement or amend the Disclosure Schedules delivered in connection herewith with respect to any matter hereafter arising which, if existing, occurring or known at the date of this Agreement, would have been required to be set forth or described in such Disclosure Schedules or which is necessary to correct any information in such Disclosure Schedules which has been rendered inaccurate thereby. From the date hereof until the Closing, Seller will promptly notify Buyer of any material change in the normal course of the Business or in the Assets and of any pending or threatened Litigation Matter. No supplement or amendment to such Disclosure Schedules shall have any effect (prior to or at Closing) for the purpose of determining satisfaction of the conditions set forth in Section 7.2 or the compliance by Seller with the covenants set forth in Section 6.3 hereof. 6.3. Conduct of Business. Between the date of this Agreement and the Closing, except as contemplated by this Agreement or as otherwise consented to by Buyer in writing, Seller shall conduct the Business only in the ordinary course and shall use all commercially reasonable efforts to preserve the Business intact for the benefit of Buyer, and to preserve its present relationships with customers, suppliers and other Persons involved with the Business. Without limiting the generality of the foregoing, Seller shall not: (a) Take any action or permit any action to be taken which would (or could reasonably be expected to) result in any of its representations and warranties set forth in this Agreement being or becoming untrue in any material respect, or any of the conditions to the consummation of the Acquisition and the other transactions contemplated by this Agreement set forth in Article VII not being satisfied in any material respect, or in any material violation of any provision of this Agreement, except, in every case, as may be required by applicable law; (b) Enter into any transaction that has, or would reasonably be expected to have, a Business Material Adverse Effect; (c) Transfer any Intellectual Property Rights to any third Person other than in connection with the sale of Products in the ordinary course of the Business; (d) Accept or otherwise become obligated under any order or agreement to deliver Products or services other than orders or agreements with quantities, prices and delivery times consistent with the Seller's past practices and the Seller's capacity to manufacture and deliver such Products; (e) Fail to keep and maintain the Assets, properties and facilities in good condition, repair and working order, normal wear and tear excepted, or grant any Liens in the same except Liens granted in the ordinary course of the Business and which, in the aggregate, shall -20- be for an amount not in excess of $10,000; or (f) Agree or otherwise obligate itself, whether in writing or otherwise, to do any of the foregoing. 6.4. Legal Conditions to the Acquisition. Each of Seller and Buyer shall use all reasonable efforts (i) to take, or cause to be taken, all actions necessary to comply promptly with all legal requirements which may be imposed on such party or any Affiliate to consummate the transactions contemplated by this Agreement, and (ii) to obtain (and to cooperate with the other party to obtain) any consent, authorization, order or approval of, or any exemption by, any Governmental Authority (including approval under the HSR Act) and of any other public or private third party which is required to be obtained or made by such party or any Affiliate in connection with the transactions contemplated by this Agreement. Each of Seller and Buyer will promptly cooperate with and furnish information to the other in connection with any such burden suffered by, or requirement imposed upon, any of them or any Affiliate in connection with the foregoing. ARTICLE VII. CONDITIONS PRECEDENT TO CLOSING 7.1. Conditions to Each Party's Obligations under this Agreement. The respective obligations of each party under this Agreement shall be subject to the fulfillment at or prior to the Closing of the following conditions, none of which may be waived: (a) Injunctions. No party hereto shall be subject to any order, decree or injunction of a court or agency of competent jurisdiction which enjoins or prohibits the consummation of the transactions contemplated by this Agreement. (b) Regulatory Approvals. All necessary approvals, authorizations and consents of all Governmental Authorities (including approval under the HSR Act) required to consummate the transactions contemplated by this Agreement shall have been obtained and shall remain in full force and effect and all waiting periods relating to such approvals, authorizations or consents shall have expired. (c) Litigation. There shall not be any pending or threatened Litigation Matter by or before any court or Governmental Authority that shall seek to restrain, prohibit or invalidate the transactions contemplated by this Agreement. 7.2. Conditions to Obligations of Buyer. The obligations of Buyer to complete the transactions provided for herein are subject to the satisfaction at or before the Closing of all of the following conditions: (a) The representations and warranties of the Seller shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (or on the date when made in the case of any representation and warranty which specifically relates to an earlier date), except as otherwise contemplated by this Agreement or consented to in writing by Buyer; provided, however, that (i) in determining whether or not the condition contained in this Section 7.2(a) shall be satisfied, -21- no effect shall be given to any exceptions in such representations and warranties relating to materiality or material adverse effect or knowledge and (ii) the condition contained in this Section 7.2(a) shall be deemed to be satisfied unless the failure of such representations and warranties to be so true and correct would, individually or in the aggregate, have a Business Material Adverse Effect. (b) All of the terms, covenants and conditions of this Agreement to be complied with or performed by Seller at or before the Closing shall have been duly complied with and performed in all material respects; (c) Buyer shall have received an opinion of Hale and Dorr LLP, counsel to Seller, dated as of the Closing Date, substantially in the form set forth in Exhibit 7.2(c) to this Agreement; (d) Seller shall have executed and delivered to Buyer a Bill of Sale and an Assumption Agreement in the forms attached hereto as Appendix B and C, respectively, and such other instruments and documents (including any consents thereto by third parties necessary to make the same valid and effective), in such form and containing such terms and provisions as Buyer may reasonably request, as shall be necessary to vest in Buyer all right, title and interest in and to the Assets free and clear of any and all Liens other than the Assumed Liabilities; (e) There shall not be any pending or threatened Litigation Matter by or before any court or Governmental Authority that shall that might affect the right of Buyer to own, use or control any of the Assets or Buyer's title therein after the Closing Date in a manner that might have a Business Material Adverse Effect; (f) There shall not have been any Business Material Adverse Effect (whether or not covered by insurance) nor shall the Seller have suffered the loss of any Permit or any material adverse change to any Required Assumed Contract; (g) Seller shall have obtained the consents of Whitney Subordinated Debt Fund, L.P. and J.H. Whitney & Co. as required by the Subordinated Note and Common Stock Purchase Agreement and the Guarantee and Collateral Agreement, each dated as of July 8, 1998, as amended; (h) Seller shall have paid in full all of its obligations under Schedules 16 and 17 to the Master Lease Finance Agreement between Seller and BancBoston Leasing Inc., dated June 12, 1996, and shall have obtained good and marketable title to the equipment leased thereunder and referenced in Section 4.4(i) of the Disclosure Schedule, free and clear of all Liens; (i) Seller shall have obtained and filed releases with respect to all security interests of record with respect to the Assets; (j) Seller shall have executed and delivered each of the Related Documents; (k) The acquisition of Buyer by Tyco International Ltd. shall not have been -22- consummated; (l) Buyer shall have received from Seller all such customary closing certificates of Seller's executive officers as Buyer shall reasonably have requested, including certificate as to the satisfaction of the conditions specified in this Section 7.2, the incumbency of Seller's executive officers, and the authenticity of the resolutions authorizing the transactions contemplated by this Agreement. 7.3. Conditions to Obligations of Seller. The obligations of Seller to complete the transactions provided for herein are subject to the satisfaction at or before the Closing of all of the following conditions: (a) The representations and warranties of Buyer shall be true and correct in all material respects as of the date of this Agreement and as of the Closing Date as though made on and as of the Closing Date (or on the date when made in the case of any representation and warranty which specifically relates to an earlier date), except as otherwise contemplated by this Agreement or consented to in writing by Seller; provided, however, that each representation which is qualified as to "materiality" shall be true and correct in all material respects without regard to such qualification; (b) All of the terms, covenants and conditions of this Agreement to be complied with or performed by Buyer at or before the Closing shall have been duly complied with and performed in all material respects; (c) Seller shall have received a legal opinion from Foley, Hoag & Eliot LLP, special counsel to Buyer, dated as of the Closing Date, substantially in the form of Exhibit 7.3(c) hereto; (d) Buyer shall have executed and delivered each of the Related Documents; and (e) Seller shall have received from Buyer all such customary closing certificates of Buyer's executive officers as Seller shall reasonably have requested, including certificate as to the satisfaction of the conditions specified in this Section 7.2, the incumbency of Buyer's executive officers, and the authenticity of the resolutions authorizing the transactions contemplated by this Agreement. ARTICLE VIII. POST-CLOSING MATTERS 8.1. Covenant of Further Assurances. Seller shall, at any time and from time to time after the Closing Date, upon the request of Buyer, execute, acknowledge, seal and deliver all such instruments and documents, and do all such further things, as Buyer may request to perfect the transfer and delivery to Buyer of any and all of the Assets that are to be sold, transferred and assigned to Buyer under this Agreement (including taking any actions necessary to assure the Seller's proper corporate authorization with respect to the transactions contemplated by this Agreement). In addition, Seller shall use commercially reasonable efforts (i) to obtain and deliver to Buyer all such third-party consents, licenses, permits and approvals as may be required for Seller to perform its obligations hereunder, (ii) to obtain for Buyer all such third-party -23- consents, licenses, permits and approvals (other than those that have previously been obtained by Buyer) as are necessary or desirable to accomplish the purchase of the Assets or to enable Buyer fully to develop, manufacture, distribute and sell the Products, and (iii) to provide to Buyer any records or other data relating to the Business which was maintained as part of Seller's company-wide records at corporate headquarters and could not be delivered to Buyer. 8.2. Payment of Taxes. Seller shall pay, promptly and when due, whether at the original time fixed therefor or pursuant to any extension of time to pay, any and all Taxes that shall become due or shall have accrued on account of the operation and conduct of the Business on or before the Closing Date or on account of any of the transactions contemplated by this Agreement, including transfer Taxes related to the transfer of the Assets to Buyer, provided, however, that Buyer shall be solely responsible for and shall pay, promptly and when due, whether at the original time fixed therefor or pursuant to any extension of time to pay, any and all such Taxes which by their terms are required to be paid by the entity purchasing assets in the Acquisition. 8.3. Confidentiality. For a period of five years from and after the Manufacturing Transition Date, Seller shall keep confidential, and shall not disclose to any third party or use, any Intellectual Property Rights or confidential or proprietary information relating to the Product Line, including, by way of example and without limitation, any vendor lists, customer lists, specifications, formulae, know-how, or other proprietary data except to the extent such information is published by, or with the written consent of, Buyer or by a third party having no obligation of confidentiality to Buyer, is already known to such third party, is otherwise made publicly available (other than by a Person who made such disclosure in breach of a confidentiality obligation), is approved by Buyer for disclosure to such third party by Seller, or as is required by law. 8.4. Defense of Claims and Litigation. At all times from and after the Closing Date, and without charge except for reimbursement of out-of-pocket expenses, each party shall consult, confer and cooperate in good faith on a reasonable basis with each other party (including the making available of witnesses and cooperation in discovery proceedings) in the conduct or defense of any claim, litigation or proceeding against said other party by any third party that relates to any of the Assets or the Assumed Liabilities or any matter that, directly or indirectly, arises therefrom, whether known at the Closing Date or arising thereafter. The foregoing notwithstanding, to the extent the indemnification provisions of this Agreement apply to any such conduct or defense, they shall control as to the payment of costs and expenses. 8.5. Delivery of Documents. Seller shall, on the Closing Date or as promptly after the Closing as practicable, deliver all books, papers, ledgers, documents and records (including, where available, electronic versions thereof) constituting part of the Assets. 8.6. Manufacturing Services to Buyer. For a period of time after the Closing Date, Seller shall manufacture or cause to be manufactured the Products on behalf of Buyer pursuant to the terms of the Transitional Manufacturing Agreement executed simultaneously with this Agreement. Seller shall also provide Buyer with access to historical data about the Business (including purchases of raw materials and sales of Product) during such time as Buyer is converting for use on its own computer systems and software the historical computer data with -24- respect to the Business. 8.7. Sharing of Data. Seller shall have the right for a period of seven years following the Closing Date to have reasonable access to such books, records and accounts, including financial and tax information, correspondence, production records, employment records and other similar information as are transferred to Buyer pursuant to the terms of this Agreement for the limited purposes of concluding its involvement in the Business prior to the Closing Date, complying with its obligations under applicable securities, tax, environmental, employment or other laws and regulations, and defending against a claim or litigation that is not an Assumed Liability. Buyer shall have the right for a period of seven years following the Closing Date to have reasonable access to such books, records and accounts, including financial and tax information, correspondence, production records, employment records and other similar information as relate to the Business but were not transferred to Buyer pursuant to the terms of this Agreement for the limited purposes of complying with its obligations under applicable securities, tax, environmental, employment or other laws and regulations, and defending against a claim or litigation relating to the Business. 8.8. Covenant Not to Compete; Non-Solicitation. (a) Covenant. In order that the Buyer may have and enjoy the full benefit of the Business and in consideration of (and as a condition to) the Buyer's agreement to enter into this Agreement and pay the Purchase Price, the Seller agrees that it will not, and will cause its subsidiaries (the persons to whom this Section 8.8 applies are hereinafter referred to as the ("Affected Parties") not to, do any of the following, without the written approval of the Buyer: (i) During the five year period from and after the Manufacturing Transition Date, engage, directly or indirectly, in any activity involving the development, manufacturing, sales, marketing, advertising, distribution or licensing of vena cava filters ("Competitive Products and Services"). Without limiting the generality of the foregoing, no Affected Party will seek authorization to become a reseller of Products. For purposes of this Section 8.8, "engage" will include, without limitation, having any direct or indirect interest in any corporation, partnership, limited liability company, joint venture or other entity, whether as an owner, stockholder, partner, member, joint venture, creditor or otherwise, or rendering any direct or indirect service or assistance to any individual, corporation, partnership, limited liability company, joint venture or other business entity (whether as an agent, consultant, or otherwise). Notwithstanding the foregoing, nothing contained herein shall limit the right of the Affected Parties to hold and make passive investments in securities of any person that is registered on a national securities exchange or admitted to trading privileges thereon or actively traded in a generally recognized over-the-counter market; provided, however, that the Affected Parties' aggregate beneficial equity interest therein shall not exceed 3% of the outstanding shares or interests in such person. (ii) During the two year period from and after the Closing Date, directly or indirectly, (A) contact or solicit (other than by general advertising) for the purpose of offering employment or hiring, induce or attempt to induce to accept employment, or -25- actually hire (in each case, whether as an employee, consultant, agent, independent contractor or otherwise), any employee of the Buyer or any of its Affiliates; (B) induce or attempt to induce any customer, supplier, licensee, or other business relation of the Buyer or any of its Affiliates to cease or reduce its business with the Buyer or any of its Affiliates; or (C) otherwise interfere with the relationship between the Buyer or any of its Affiliates and any such person described in clause (A) or (B) (including, without limitation, making any negative statements or communications concerning the Buyer or any of its Affiliates or concerning any Product). Notwithstanding the foregoing, the Seller shall not be prohibited from hiring any employee of the Buyer or any of its Affiliates who has initiated contact with the Seller. (b) Judicial Modification. If the final judgment of a court of competent jurisdiction declares that any term or provision of Section 8.8 is invalid or unenforceable, the parties agree that the court making the determination of invalidity or unenforceability should not abrogate the otherwise invalid or unenforceable provision, but should, instead, reduce the scope, duration, or geographic area of the term or provision, or delete specific words or phrases, or replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, and this Agreement shall be enforceable as so modified after the expiration of the time within which the judgment or decision may be appealed. 8.9. Employees. Buyer shall have no obligation hereunder to employ any employee of Seller or to make any payment to any employee of Seller. During the two year period from and after the Closing Date, Buyer shall not, directly or indirectly, contact or solicit (other than by general advertising) for the purpose of offering employment or hiring, induce or attempt to induce to accept employment, or actually hire (in each case, whether as an employee, consultant, agent, independent contractor or otherwise), any employee of the Seller or any of its Affiliates, unless Seller shall have given its prior written consent to such contact, solicitation, inducement, or hiring. Notwithstanding the foregoing, the Buyer shall not be prohibited from hiring any employee of the Seller or any of its Affiliates who has initiated contact with the Buyer. 8.10. Use of Seller's Markings. Until the date on which Buyer exhausts Inventory items consisting of printed materials containing any name, symbol or trademark owned by Seller and not included in the Assets (collectively, "Seller's Markings"), Seller hereby grants to Buyer a limited, non-exclusive right to the use of Seller's Markings as they appear on printed materials existing as of the Closing Date, subject to the following conditions: (a) Buyer shall not reorder current printed materials containing Seller's Markings; (b) Buyer shall within a reasonable time period after the Closing promptly place an order or orders to purchase replacement labels and packaging materials not bearing Seller's Markings; (c) Buyer shall place a label overlay on the outer shipping carton of any Product manufactured after the Closing, with such label overlay covering completely Seller's Markings, and clearly and conspicuously indicating Buyer's succession to the ownership of the Product. 8.11. Hart-Scott-Rodino Act. Each of the Parties shall promptly file (or cause to be filed) any Notification and Report Forms and related material that it may be required to file with the Federal Trade Commission and the Antitrust Division of the United States Department of Justice under the Hart-Scott-Rodino Act, shall use commercially reasonable efforts to obtain an -26- early termination of the applicable waiting period, and shall make any further filings or information submissions pursuant thereto that may be required by law. 8.12. Assignment of Certain Contracts. Certain contracts, licenses and agreements of the Seller (other than the Assumed Contracts) might not be assigned to Buyer at the Closing because the Seller has not yet obtained consents necessary for such assignment. Following the Closing, the Seller will continue to diligently work to obtain all consents required under such contracts, licenses and agreements other than the Excluded Contracts. ARTICLE IX. Indemnification 9.1. Indemnification. (a) Buyer's Indemnification Obligations. On and after the Closing Date, Buyer hereby agrees to indemnify and hold harmless Seller and each of its directors, officers, employees, subsidiaries and other Affiliates (collectively, the "Seller Indemnified Parties") from and against and in respect of any and all claims, losses, damages, costs, expenses, obligations, liabilities, charges, actions, suits, proceedings, deficiencies, interest, penalties and fines (including costs of collection, attorney's fees and other costs of defense, removal costs, remediation costs, costs of enforcing indemnification provisions, closure costs and expenses of investigation and ongoing monitoring) (collectively, "Damages") imposed on, sustained, incurred or suffered by or asserted against them, directly or indirectly, in respect of, but only in respect of: (i) any breach of Buyer's representations and warranties, including representations and warranties of Buyer contained herein, in any of the Related Documents, or in any Certificate delivered by Buyer pursuant to the terms of this Agreement or any Related Document, any such claim to be made by Seller within the period of survivability set forth in Section 10.4; (ii) Buyer's failure to perform or otherwise fulfill any of its agreements, covenants, obligations or undertakings hereunder or under any of the Related Documents, or under any document delivered by Buyer pursuant to this Agreement or any Related Document; (iii) the Assumed Liabilities; (iv) all Buyer Products Liability; and (v) Buyer's operation of the Business following the Closing Date. (b) Seller's Indemnification Obligations. On and after the Closing Date, Seller hereby agrees to indemnify and hold Buyer and each of its directors, officers, employees, subsidiaries, and other Affiliates (collectively, the "Buyer Indemnified Parties"), harmless from and against and in respect of any and all Damages imposed on, sustained, incurred or suffered by or asserted against them directly or indirectly, but only in respect of: -27- (i) any breach of Seller's representations and warranties (as such representations and warranties may have been updated as of the Closing pursuant to Section 6.2), including representations and warranties of Seller contained herein, in any Related Document or any certificate delivered by Seller pursuant to this Agreement or any Related Document, any such claim to be made by Buyer within the period of survivability set forth in Section 10.4; (ii) Seller's failure to perform or otherwise fulfill any of its agreements, covenants, obligations or undertakings hereunder or under any of the Related Documents, or under any document delivered by Seller pursuant to this Agreement or any Related Document; (iii) all Excluded Liabilities; (iv) all Seller Products Liability; (v) any failure of Seller to fulfill its obligations described in Exhibit 9.1(b)(v); and (vi) Seller's operation of the Business on or before the Closing Date. 9.2. Procedure. If a claim or demand by a third party is made against an indemnified party, and if such party intends to seek indemnity with respect thereto under this Article IX or under any other provisions of this Agreement providing for indemnification, such indemnified party shall promptly notify the indemnifying party in writing of such claims or demands setting forth such claims in reasonable detail. The failure of the indemnified party to give the indemnifying party prompt notice as provided herein shall not relieve the indemnifying party of any of its obligations under this Article IX, except to the extent that the indemnifying party is materially prejudiced by such failure (in which case the indemnified party shall have been deemed to have forfeited its rights to indemnification hereunder). The indemnifying party shall have 30 days after receipt of such notice to undertake, conduct and control, through counsel of its own choosing and at its own expense, the settlement or defense thereof, and the indemnified party shall cooperate with it in connection therewith; provided, that the indemnified party may participate in such settlement or defense through counsel chosen by such indemnified party and the fees and expenses of such counsel shall be borne by such indemnified party unless (i) the employment thereof has been specifically authorized by the indemnifying party in writing, (ii) there exists a conflict of interest between the interests of the indemnified party and the indemnifying party, or (iii) the indemnifying party has after a reasonable time failed to assume such defense and employ counsel, in each of which events the indemnified party may retain counsel which shall be reasonably satisfactory to the indemnifying party, and the indemnifying party shall pay the reasonable fees and expenses of such counsel for the indemnified party (but in no event shall the indemnifying party be obligated to pay fees and expenses of more than one firm, which firm shall serve as counsel for all indemnified parties). So long as the indemnifying party is reasonably contesting any such claim in good faith, the indemnified party shall not pay or settle any such claim. Notwithstanding the foregoing, the indemnified party shall have the right to pay or settle any such claim; provided, that in such event it shall waive any right to indemnity therefor by the indemnifying party. If the indemnifying party does not notify the -28- indemnified party within 30 days after the receipt of the indemnified party's notice of a claim of indemnity hereunder that it elects to undertake the defense thereof, the indemnified party shall have the right to contest, settle or compromise the claim but shall not thereby waive any right to indemnity therefor pursuant to this Agreement. The indemnifying party shall not, except with the consent of the indemnified party, enter into any settlement that (i) does not include as an unconditional term thereof the giving by the person or persons asserting such claim to all indemnified parties (i.e., Seller Indemnified Party or Buyer Indemnified Party, as the case may be) an unconditional release from all liability with respect to such claim or consent to entry of any judgment and (ii) with respect to a settlement involving the 577 Patent, would have an adverse effect on the indemnified party's rights in the 577 Patent. 9.3. Limitation on Indemnification. (a) Special, Punitive, Consequential and Incidental Damages. In no event shall Seller or Buyer, as the case may be, be liable to Buyer Indemnified Parties or Seller Indemnified Parties, respectively, for special, punitive, consequential or incidental damages; provided that, the Seller or Buyer, as the case may be, may be liable to the Buyer Indemnified Parties or the Seller Indemnified Parties, as the case may be, for special, punitive, consequential or incidental damages (i) awarded against an indemnified party in favor of a third party, or (ii) resulting from such Party's willful or grossly negligent breach of this Agreement or any Related Document. (b) Indemnity Payments Reduced by Insurance Proceeds Any indemnity payment payable pursuant to this Agreement shall be decreased to the extent of any insurance proceeds actually received by the Buyer Indemnified Party or the Seller Indemnified Party, as the case may be. (c) Limitation on Indemnification. The Seller shall be required to indemnify and hold harmless the Buyer Indemnified Parties for the aggregate amount of all Damages incurred by such indemnified parties under this Article IX; provided, however, that, subject to the last sentence of this Section 9.3(c), no indemnification shall be required pursuant to 9.1(b)(i) unless the aggregate amount of all Damages of the Buyer Indemnified Parties arising pursuant to 9.1(b)(i) exceeds Fifty Thousand Dollars ($50,000) (the "Deductible"). The parties agree that once the Deductible has been reached the Buyer Indemnified Parties may only recover Damages pursuant to 9.1(b)(i) over and above the Deductible. Notwithstanding the foregoing, Buyer shall be entitled to indemnification in full, without regard to the Deductible, for all Damages arising under Sections 9.1(b)(ii) through 9.1(b)(vi). (d) Limitation on Aggregate Liability. In no event shall the aggregate liability of the Seller pursuant to this Article IX exceed Ten Million Dollars ($10,000,000), provided, however that the limitation set forth in this Section 9.3(d) shall not apply to (i) Damages arising pursuant to Section 9.1(b)(v) hereof, or (ii) Damages arising as the result of Seller's breach of Sections 4.6, 4.12(c) and 4.12(h) hereof, which shall not exceed the Purchase Price actually received by Seller. 9.4. Exclusive Remedy. Each of Seller and Buyer acknowledges and agrees that, from and after the Closing (except in the case of causes of action arising from fraud or as provided in -29- Section 9.5(b) or Section 10.7 hereof), its sole and exclusive remedy with respect to any and all claims for money damages against the other party relating to the subject matter of this Agreement (other than the Related Documents) shall be pursuant to the indemnification provisions set forth in this Article IX or as otherwise provided hereunder. 9.5. Dispute Resolution. (a) Negotiation. In the event of any dispute or disagreement between Seller and Buyer as to the interpretation of any provision of this Agreement or any other Related Document (or the performance of any obligations hereunder or thereunder), the matter, upon written request of either party, shall be referred to representatives of the parties for decision, each party being represented by a senior executive officer who has no direct operational responsibility for the matters contemplated by this Agreement (the "Representatives"). The Representatives shall promptly meet in a good faith effort to resolve the dispute. If the Representatives do not agree upon a decision within 30 calendar days after reference of the matter to them, each of Buyer and Seller shall be free to exercise the remedies available to it under Section 9.5(b) below. (b) Arbitration. Any controversy, dispute or claim arising out of or relating in any way to this Agreement or the other Related Documents or the transactions arising hereunder or thereunder that cannot be resolved by negotiation pursuant to Section 9.5(a) above shall, except as otherwise provided in Section 10.7, be settled exclusively by arbitration in the City of Boston. Such arbitration shall be administered by the Center for Public Resources Institute for Dispute Resolutions (the "Institute") in accordance with its then prevailing Rules for Non-Administered Arbitration of Business Disputes (except as otherwise provided herein) (the "Rules"), by one independent and impartial arbitrator jointly selected by Buyer and Seller (or, if they cannot agree, in accordance with the Rules). Notwithstanding anything to the contrary provided herein, the arbitration shall be governed by the United States Arbitration Act, 9 U.S.C. ss. 1 et seq. The fees and expenses of the Institute and the arbitrator shall be shared equally by the Parties and advanced by them from time to time as required; provided that at the conclusion of the arbitration, the arbitrator shall, at its discretion, award costs and expenses (including the costs of the arbitration previously advanced and the fees and expenses of attorneys, accountants and other experts) between the Parties pro rata based on the relative bona fides of the claims asserted by each party. The arbitrator shall permit and facilitate such discovery as it shall determine appropriate in the circumstances. Buyer and Seller shall keep confidential any proprietary information, trade secrets or other non-public information disclosed in discovery. The arbitrator shall render its award within 90 days of the conclusion of the arbitration hearing. The arbitrator shall not be empowered to award to either party any special, consequential, incidental or punitive damages in connection with any dispute between them arising out of or relating in any way to this Agreement or the other agreements contemplated hereby or the transactions arising hereunder or thereunder, provided that, the arbitrator may provide for the payment of special, consequential, incidental, or punitive damages (i) awarded against an indemnified party in favor of a third party, or (ii) resulting from any Party's willful or grossly negligent breach of this Agreement or any Related Document. Notwithstanding anything to the contrary provided in this Section 9.5(b) and without prejudice to the above procedures, either party may apply to any court of competent jurisdiction for temporary injunctive or other provisional judicial relief if -30- such action is necessary to avoid irreparable damage or to preserve the status quo until such time as the arbitration panel is convened and available to hear such party's request for temporary relief. The award rendered by the arbitrator shall be final and not subject to judicial review, and judgment thereon may be entered in any court of competent jurisdiction. ARTICLE X. MISCELLANEOUS 10.1. Termination. This Agreement may be terminated at any time prior to the Closing: (a) By mutual consent of Buyer and Seller in a written instrument; (b) By either Buyer or Seller (provided that the terminating party is not then in material breach of any representation, warranty, covenant or other agreement contained herein), if there has been a material breach on the part of the other party of any representation, warranty or agreement contained herein which cannot be or has not been cured within 30 days after written notice of such breach by the terminating party to the party in breach; (c) At the election of either Buyer or Seller, if the Closing shall not have occurred on or before January 31, 2002 (the "Termination Date"), or such later date as shall have been agreed to in writing by Buyer and Seller; provided, that no party may terminate this Agreement pursuant to this Section 10.1(c) if the failure of the Closing to have occurred on or before said date was due to such party's breach of any of its obligations under this Agreement; (d) By either Buyer or Seller, if any permanent injunction or action by any Governmental Authority preventing the consummation of the Acquisition shall have become final and nonappealable; or (e) By Buyer if the acquisition of Buyer by Tyco International Ltd. is consummated prior to the Closing Date. 10.2. Effect of Termination. In the event of termination of this Agreement and abandonment of the Acquisition by either Seller or Buyer as provided in Section 10.1, this Agreement shall forthwith terminate and there shall be no liability or obligation on the part of Buyer or Seller or their respective officers or directors, except that (i) the provisions of Sections 1.1, 10.3, 10.10, 10.13, 10.14, and 10.20 (and of this Section 10.2) shall survive such termination of this Agreement and remain in full force and effect and (ii) notwithstanding anything to the contrary contained in this Agreement, each party shall remain liable (in an action at law or otherwise) for any liabilities or damages arising out of material breach of any of its representations, warranties, covenants or agreements set forth in this Agreement. 10.3. Confidentiality Upon Termination. All information not previously disclosed to the public or generally known to Persons engaged in the respective businesses of Seller or Buyer which shall have been furnished by any of such Parties to the another of such Parties in connection with the transactions contemplated hereby shall not be disclosed to any Person other than their respective employees, directors, attorneys, accountants or financial advisors or other -31- than as contemplated herein. In the event that the transactions contemplated by this Agreement shall not be consummated, all such information which shall be in writing shall be returned to the party furnishing the same, including, to the extent reasonably practicable, all copies or reproductions thereof which may have been prepared, and neither party shall at any time thereafter disclose to third parties, or use, directly or indirectly, for its own benefit, any such information, written or oral, about the business of the other party hereto. 10.4. Survival of Representations and Warranties. Notwithstanding any investigation conducted before or after the Closing, and notwithstanding any knowledge or notice of any fact or circumstance that either Buyer or Seller may have as the result of such investigation or otherwise, Buyer and Seller shall each be entitled to rely upon the representations, warranties and covenants of the other in this Agreement. Each of the representations and warranties contained in this Agreement, in any of the Related Documents or in any Certificate delivered hereunder shall terminate upon the second anniversary of the Closing Date, other than the representations contained in Sections 4.6, 4.12(c) and 4.12(h), which shall survive the Closing indefinitely. 10.5. Brokerage. Buyer and Seller represent to each other that there has been no intermediary or broker in negotiations or discussions incident to the execution of this Agreement or any of the transactions contemplated hereby and each party to this Agreement hereby indemnifies the other against any commission or other compensation due or becoming due with respect to any of such transactions. 10.6. Waivers and Amendments. (a) This Agreement may be amended, modified or supplemented only by a written instrument executed by the Parties hereto. (b) No waiver of any provision of this Agreement, or consent to any departure from the terms hereof, shall be effective unless the same shall be in writing and signed by the party waiving or consenting thereto. No failure on the part of any party to exercise, and no delay in exercising, any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or remedy by such party preclude any other or further exercise thereof or the exercise of any other right or remedy. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate as a waiver of any subsequent breach. All rights and remedies hereunder are cumulative and are in addition to and not exclusive of any other rights and remedies provided by law. 10.7. Performance. Each Party hereto acknowledges that money damages alone will not adequately compensate such party for breach of such Party's obligations under Section 8.3, and Section 8.10, and, therefore, agrees that in the event of the breach or threatened breach of any such obligation, in addition to all other remedies available to the other Party, at law, in equity or otherwise, such other Party shall be entitled to injunctive relief compelling specific performance of, or other compliance with, the terms of any such Section. 10.8. Allocation of Purchase Price. The Purchase Price shall be allocated among the Assets as shown in Exhibit 10.8. 10.9. Notices. All notices and other communications hereunder shall be in writing and -32- shall be deemed given if delivered personally, telecopied (with confirmation) or mailed by registered or certified mail (return receipt requested) to the Parties at the following addresses: (a) if to Seller, to: NMT Medical, Inc. 27 Wormwood Street Boston, Massachusetts 02110-1625 Attention: President Telecopier No.: 617-737-0924 with a copy to: Michael J. LaCascia Hale and Dorr LLP 60 State Street Boston, Massachusetts 02109 Telecopier No.: 617-526-5000 (b) if to Buyer, to: C.R. Bard, Inc. 730 Central Avenue Murray Hill, New Jersey 07974 Attention: General Counsel Telecopier No.: with a copy to: Peter W. Coogan Carol Hempfling Pratt Foley, Hoag & Eliot LLP One Post Office Square Boston, Massachusetts 02109 Telecopier No.: (617) 832-7000 or at such other address for a party as shall be specified by like notice. 10.10. Expenses. Each party hereto shall pay its own expenses in connection with the transactions contemplated hereby, whether or not they are completed. In the event of any conflict between this provision and the indemnification or termination provisions of this Agreement, the indemnification or termination provisions, as the case may be, shall control. 10.11. No Solicitation. Seller shall not, directly or indirectly, through any officer, director, agent or otherwise, solicit, initiate or encourage the submission of any proposal or offer from any person (other than Buyer) relating to any acquisition or purchase of the Business or any material portion thereof or Assets relating thereto, or participate in any negotiations regarding, or furnish to any other person any information with respect to, or otherwise cooperate in any way -33- with, or assist or participate in, facilitate, any effort or attempt by any other person to do or seek any such acquisition or purchase. The Seller shall immediately cease and cause to be terminated all existing discussions or negotiations with any Parties conducted heretofore with respect to the foregoing. 10.12. Publicity. The Parties will consult with respect to the appropriate public disclosure to be made with respect to the transactions contemplated hereby, and will make no such disclosure without reasonable notice to the other Party prior to such disclosure, except as may be required by law or by the rules of any stock exchange. 10.13. Entire Agreement. This Agreement and the Related Documents constitute the entire agreement among the Parties hereto with respect to the subject matter hereof and supersede all prior agreements and understandings, whether written or oral, among the Parties, or any of them, in connection with such subject matter, and, as of the Closing Date, the Distribution Agreement, dated as of May 19, 1992, as amended, between the parties, and the International Distribution Agreement, dated as of November 30, 1995, as amended, between Bard International, Inc. and the Seller, shall terminate and be of no further force and effect. 10.14. Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of The Commonwealth of Massachusetts, without giving effect to its conflicts of laws rules. 10.15. Interpretation. When a reference is made in this Agreement to Sections or Exhibits, such reference shall be to a Section of or Exhibit to this Agreement unless otherwise indicated. The recitals hereto constitute an integral part of this Agreement. The table of contents, index and headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement. Whenever the words "include", "includes" or "including" are used in this Agreement, they shall be deemed to be followed by the words "without limitation". 10.16. Severability. Any provision of this Agreement which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or affecting the validity or enforceability of such provision in any other jurisdiction. In the event that any provision of this Agreement shall be determined to be unenforceable by reason of its extension for too great a period of time or over too large a geographic area or over too great a range of activities, it shall be interpreted to extend only over the maximum period of time, geographic area or range of activities as to which it may be enforceable. 10.17. Exhibits. All Exhibits mentioned in this Agreement shall be attached to this Agreement, and shall form an integral part hereof. All capitalized terms defined in this Agreement which are used in any Exhibit shall, unless the context otherwise requires, have the same meaning therein as given herein. 10.18. Counterparts. This Agreement may be executed in two or more counterparts, all of which shall be considered one and the same agreement and shall become effective when two or more counterparts have been signed by each of the Parties and delivered to the other Parties, it -34- being understood that all Parties need not sign the same counterpart. 10.19. No Assignment by Seller. This Agreement is personal to Seller, and Seller shall not assign any of its rights or delegate any of its obligations hereunder without the prior written consent of Buyer, which consent may be withheld for any reason. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the Parties and their respective successors and assigns. Without the consent of Seller, Buyer shall be entitled to assign any or all of its rights hereunder. 10.20. Waiver of Jury Trial. Seller and Buyer each hereby irrevocably and unconditionally waives all rights to trial by jury in any legal action, proceeding or counterclaim with respect to any matter whatsoever arising out of or in connection with or related to this Agreement or the enforcement thereof. * * * * * The remainder of this page has been intentionally left blank -35- IN WITNESS WHEREOF, the undersigned have duly executed and delivered this Agreement as of the date first above written. C. R. BARD, INC. By: Timothy M. Ring --------------------------------------- Title: Group President ------------------------------------ NMT MEDICAL, INC. By: John E. Ahern --------------------------------------- Title: President & Chief Executive Officer ------------------------------------ -36- EX-10.1 4 dex101.txt ROYALTY AGREEMENT - -------------------------------------------------------------------------------- Confidential Materials omitted and filed separately with the Securities and Exchange Commission. Asterisks denote omissions. - -------------------------------------------------------------------------------- Exhibit 10.1 ROYALTY AGREEMENT THIS ROYALTY AGREEMENT made this 19th day of October, 2001 by and among C.R. Bard, Inc., a New Jersey corporation ("Bard"), NMT Medical, Inc., a Delaware corporation ("NMT"). Capitalized terms used but not defined herein shall have the meaning set forth in the Asset Purchase Agreement of even date herewith between Bard and NMT (the "Purchase Agreement"). WHEREAS, pursuant to the Purchase Agreement, Bard has agreed to purchase from NMT, and NMT has agreed to sell to Bard, certain Assets, consisting of NMT's vena cava filter Product Line and substantially all of the business, assets and properties that the vena cava filter Business comprises; and WHEREAS, as a portion of the consideration payable for the Assets, Bard has agreed to pay certain royalties to NMT, as more fully set forth herein; and WHEREAS, for a transitional period following the Closing Date under the Purchase Agreement, Seller has agreed to continue to manufacture vena cava filter Products for Buyer pursuant to a Transitional Manufacturing Agreement dated as of the date hereof. NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the Parties agree as follows: Article I. BARD'S ROYALTY PAYMENTS 1.1. Royalties with respect to RNF and RC. For a period of [**] years after the date of Bard's first commercial sale in the United States of the Recovery Filter ("RNF"), Bard shall pay to NMT an amount equal to (x) [**]% of Bard's Net Sales of the RNF and the Recovery Cone ("RC") in the United States and (y) [**]% of Bard's Net Sales of the RNF and the RC outside the United States. Thereafter, Bard shall pay to NMT an amount equal to (x) [**]% of Bard's Net Sales of the RNF and the RC in the United States and (y) [**]% of Buyer's Net Sales of the RNF and the RC outside the United States. 1.2. Royalties with respect to SNF. Commencing on the Manufacturing Transition Date, Bard shall pay to NMT royalties on all Simon Nitinol Filter ("SNF") Products that Bard or its designee manufactures and sells to end users at the following royalty rates: (x) [**]% of Bard's Net Sales of the SNF in the United States and (y) [**]% of Bard's Net Sales of the SNF outside the United States. 1.3. Payment of Royalties. Bard shall pay all royalties in United States Dollars and shall calculate and pay such royalties quarterly within [**] days following the last day of each calendar quarter. If Bard is required to pay any withholding tax in respect of any royalties or payments due to NMT, the amount of the actual payment to NMT may be reduced by the amount of the withholding tax paid by Bard. 1.4. Net Sales Defined. For purposes of this Agreement, "Net Sales" with respect to a Product shall mean, for any fiscal quarter, the gross invoiced sales of such Product by Bard or any Affiliate of Bard to all non-affiliated third parties, less the following offsets and deductions: (i) sales, use or value-added taxes, to the extent included in the gross invoiced sales; and (ii) freight and handling charges, to the extent included in the gross invoiced sales; and (iii) relevant customary cash, trade and quantity discounts and rebates actually granted and given by Bard or an Affiliate to customers, including but not limited to administrative fees paid to any group purchasing organization of which the customer is a member; and (iv) allowances, credits and payments for returned Products. In the event the Product is sold in kit or in combination with any item which is not covered by the Intellectual Property Rights ("Kit"), the Net Sales of such Product shall be determined for each quarter by application of the following formula: [**] o "Average Retail Price" means (a) with respect to each component in a Kit that is not manufactured by Bard or its designee, the average retail sales price to hospitals of such component during such quarter, and (b) with respect to each component in a Kit that is manufactured by Bard or its designee, Bard's or its Affiliate's Average Sale Price for such component, as such component is sold separately. o "Average Sale Price," for either a Kit or a component sold separately by Bard, shall be calculated by dividing (A) Bard's or its Affiliate's gross invoiced selling price during such fiscal quarter for all such Kits or separately-sold components, as the case may be, less applicable deductions and offsets set forth above, divided by (B) the total number of such Kits or separately-sold components, as the case may be, sold by Bard or its Affiliate during such fiscal quarter. Article II. REPORTS 2.1. Reports by Bard. At the time of Bard's remittance of each royalty payment pursuant to Section 1.3, Bard shall furnish to NMT a report showing the type and total number of the Products sold and or licensed to others by Bard or any Affiliate of Bard during the quarter to which the royalty payment relates, the aggregate Net Sales during such quarter and sufficient information from which the royalties payable may be determined 2.2. Confidentiality. All reports and information delivered by Bard under this Article II shall be considered confidential information ("Confidential Information"). 2.3. Audit Rights. Bard shall keep complete and accurate records of the underlying Product sales and expense data relating to the reports and payments required under this Royalty Agreement. NMT shall have the right once annually at its own expense to have an independent public accountant, selected by NMT and reasonably acceptable to Bard (the "Auditor"), review any such records of Bard in the locations where such records are maintained by Bard upon reasonable notice and during normal business hours and under obligations of strict confidence, for the sole purposes of verifying the basis and accuracy of the royalty payments payable - 2 - hereunder. If the review of such record reveals that Bard has failed to accurately (i) calculate and pay royalties under Article I or (ii) report information pursuant to Section 2.1, then Bard shall promptly pay NMT any resulting royalty amounts, together with interest thereon at a rate equal to 1% per month. In the event that the royalty amounts determined to be due as a result of any annual audit are greater than 10% of the amounts actually paid without regard to such audit, Bard shall pay NMT's reasonable out-of-pocket expenses incurred in conducting such audit. If Bard disputes in good faith the conclusions of the Auditor under this Section 2.3, then Bard shall notify NMT of its dispute and any such dispute shall be resolved in accordance with the provisions of Section 9.5 of the Purchase Agreement. Article III. CONFIDENTIALITY NMT shall keep confidential, and shall not disclose to any third party or use, any Confidential Information, as defined in Section 2.2 hereof, except to the extent such information (i) is published by, or with the written consent of, Bard or by a third party having no obligation of confidentiality to Bard, (ii) is already known to such third party, (iii) is otherwise made publicly available (other than by a person who made such disclosure in breach of a confidentiality obligation), or (iv) as is required by law. Article IV. MISCELLANEOUS 4.1. Waivers and Amendments. (a) This Agreement may be amended, modified or supplemented only by a written instrument executed by the parties hereto. (b) No waiver of any provision of this Agreement, or consent to any departure from the terms hereof, shall be effective unless the same shall be in writing and signed by the party waiving or consenting thereto. No failure on the part of any party to exercise, and no delay in exercising, any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or remedy by such party preclude any other or further exercise thereof or the exercise of any other right or remedy. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate as a waiver of any subsequent breach. All rights and remedies hereunder are cumulative and are in addition to and not exclusive of any other rights and remedies provided by law. 4.2. Entire Agreement. This Agreement and the Related Documents (as such term is defined in the Purchase Agreement) constitute the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether written or oral, among the parties, or any of them, in connection with such subject matter. 4.3. Set Off. Buyer's obligations to make payments to Seller hereunder may be applied or set off by Buyer or any Affiliate against any liabilities of Seller due and payable to Buyer or any such Affiliate pursuant to Section 9.1(b) of the Purchase Agreement hereof at any time, whether or not other collateral is then available and without regard to the adequacy of any such - 3 - other collateral. 4.4. Indemnification. NMT will indemnify Bard pursuant to Section 9.1(b)(v) of the Purchase Agreement. 4.5. Dispute Resolution; Arbitration. All differences, disputes or claims arising in connection with this Agreement or any transaction or occurrence contemplated hereby shall be settled in the manner set forth in Section 9.5 of the Purchase Agreement. 4.6. Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of The Commonwealth of Massachusetts, without giving effect to its conflicts of laws rules. 4.7. No Election of Remedies. The rights and remedies accorded herein to NMT and Bard are cumulative and in addition to those provided by law, and may be exercised separately, concurrently, or successively. 4.8. Notices. Any notice or other communication in connection with this Agreement shall be in writing and shall be sufficiently given if sent in accordance with Section 10.9 of the Purchase Agreement. 4.9. Termination. If the Purchase Agreement shall terminate prior to the Closing Date thereunder, this Agreement shall terminate simultaneously therewith. * * * * * The remainder of this page has been intentionally left blank. - 4 - IN WITNESS WHEREOF, the parties hereto have caused this Royalty Agreement to be executed in their names by their properly and duly authorized officers or representatives as of the date first above written. NMT MEDICAL, INC. C.R. BARD, INC. By: John E. Ahern By: Timothy M. Ring --------------------------------- -------------------------- Its: President & Chief Executive Officer Its: Group President ----------------------------------- -------------------------- - 5 - EX-10.2 5 dex102.txt AMENDMENT NUMBER 1 TO ROYALTY AGREEMENT - -------------------------------------------------------------------------------- Confidential Materials omitted and filed separately with the Securities and Exchange Commission. Asterisks denote omissions. - -------------------------------------------------------------------------------- Exhibit 10.2 AMENDMENT NO. 1 TO ROYALTY AGREEMENT This Amendment No. 1 (this "Amendment"), dated as of November 5, 2001, to the Royalty Agreement, dated as of October 19, 2001, as amended by letter agreement also dated October 19, 2001 (the "Royalty Agreement"), is by and between NMT Medical, Inc., a Delaware corporation ("NMT"), and C.R. Bard, Inc., a New Jersey corporation ("Bard"). WHEREAS, NMT and Bard have heretofore executed and entered into the Royalty Agreement; and WHEREAS, pursuant to Section 4.1(a) of the Royalty Agreement, NMT and Bard may amend, modify or supplement the Royalty Agreement only by a written instrument executed by each of the parties; and WHEREAS, NMT and Bard desire to further amend the Royalty Agreement on the terms and conditions set forth in this Amendment. NOW, THEREFORE, the parties hereto agree as follows: 1. Amendment. Section 1.4 of the Royalty Agreement is hereby deleted and the following new Section 1.4 inserted in lieu thereof: "1.4 Net Sales Defined. For purposes of this Agreement, "Net Sales" with respect to a Product shall mean, for any fiscal quarter, the gross invoiced sales of such Product by Bard or any Affiliate of Bard to all non-affiliated third parties, less the following offsets and deductions: (i) sales, use or value-added taxes, to the extent included in the gross invoiced sales; and (ii) freight and handling charges, to the extent included in the gross invoiced sales; and (iii) relevant customary cash, trade and quantity discounts and rebates actually granted and given by Bard or an Affiliate to customers, including but not limited to administrative fees paid to any group purchasing organization of which the customer is a member; and (iv) allowances, credits and payments for returned Products. In the event the Product is sold in kit or in combination with any item which is not covered by the Intellectual Property Rights ("Kit"), the Net Sales of such Product shall be determined for each quarter by application of the following formula: [**] o "Average Retail Price" means (a) with respect to each component in a Kit that is not a Product, the average retail sales price to hospitals of such component during such quarter, and (b) with respect to each Product in a Kit, Bard's or its Affiliate's Average Sale Price for such Product, as sold separately. o "Average Sale Price," for either a Kit or a Product in a Kit, shall be calculated by dividing (A) Bard's or its Affiliate's gross invoiced selling price during such fiscal quarter for all such Kits or separately-sold Products, as the case may be, less applicable deductions and offsets set forth above, divided by (B) the total number of such Kits or separately-sold Products, as the case may be, sold by Bard or its Affiliate during such fiscal quarter." 2. Full Force and Effect. Except as expressly amended hereby, the Royalty Agreement shall continue in full force and effect and is in all respects ratified and confirmed. 3. Governing Law. This Amendment shall be governed by, and construed and enforced in accordance with, the substantive laws of the Commonwealth of Massachusetts, without giving effect to its conflicts of laws rules. 4. Counterparts. This Amendment may be executed in any number of counterparts, each of such counterparts shall for all purposes be deemed an original and all such counterparts shall together constitute but one and the same instrument. IN WITNESS WHEREOF, the parties have caused this Amendment No. 1 to Royalty Agreement to be executed in counterparts as of the date first written above. NMT MEDICAL, INC. C.R. BARD, INC. By: John E. Ahern By: Robert Mellen ------------------------------- ---------------------------------------- Its: President & Chief Executive Its: President, Bard Peripheral Officer Technologies, a division of C.R. Bard, Inc. ------------------------------ ------------------------------------------- 2 EX-10.3 6 dex103.txt TRANSITIONAL MANUFACTURING AGREEMENT - -------------------------------------------------------------------------------- Confidential Materials omitted and filed separately with the Securities and Exchange Commission. Asterisks denote omissions. - -------------------------------------------------------------------------------- Exhibit 10.3 TRANSITIONAL MANUFACTURING AGREEMENT This Transitional Manufacturing Agreement (this "Agreement") made this 5th day of November, 2001 (the "Effective Date"), by and between NMT Medical, Inc. ("NMT"), a Delaware corporation, and C.R. Bard, Inc., a New Jersey corporation ("Bard"). WHEREAS, NMT and Bard have entered into an Asset Purchase Agreement dated October 19, 2001 (the "Purchase Agreement") pursuant to which NMT has agreed to sell to Bard, and Bard has agreed to purchase from NMT, various Assets (such term, as well as other capitalized terms used but not defined herein, shall have the meanings defined in the Purchase Agreement), consisting of NMT's vena cava filter Product Line; and WHEREAS, Bard wishes to engage NMT to manufacture the Simon Nitinol Filter for a transitional period following the Closing of the transactions contemplated by the Purchase Agreement; and WHEREAS, Bard further wishes to engage NMT to manufacture a limited supply of Recovery Filters and Recovery Cones; NOW, THEREFORE, in consideration of the premises and the mutual covenants and benefits herein contained, the parties agree as follows: 1. Definitions. 1.1. Certain Definitions. As used in this Agreement, the following terms shall have the following meanings: (a) "FDA" shall mean the United States Food and Drug Administration. (b) "Person" shall mean an individual, corporation, partnership, limited partnership, limited liability company, unincorporated association, trust, joint venture or other organization or entity, including a government, political subdivision, agency or instrumentality of a government. (c) "Products" shall mean the SNF, the RNF and the RC. References herein to Products shall also be deemed references to any parts or components thereof where the context permits. (d) "Product Specification" shall mean the written description of a Product which NMT will manufacture for Bard hereunder, including a description of its technical and performance specifications, together with all related plans and drawings. NMT has transferred and sold to Bard the Product Specifications for each of the Products pursuant to the Purchase Agreement. 1 (e) "Purchase Orders" shall mean orders transmitted by Bard (in written or electronic form), conforming to the requirements of this Agreement, and authorizing and directing NMT to manufacture and deliver specified Products on specified delivery dates. (f) "QSR/GMP" shall mean Quality Systems Regulations and Good Manufacturing Practices for medical devices, as promulgated by the FDA. (g) "RC" or an "RC Unit" shall mean the Recovery Cone. (h) "RNF" or an "RNF Unit" shall mean the Recovery Nitinol Filter, including the delivery system. (i) "SNF" or an "SNF Unit" shall mean the Simon Nitinol Filter, including the delivery system. 1.2. Additional Definitions. Certain additional capitalized terms are defined below in the body of this Agreement. 2. Manufacture, Sale and Purchase of Products. 2.1. SNF Units. Commencing on the date of the closing of the transactions contemplated by the Purchase Agreement (the "Commencement Date") and continuing until the earlier of (a) the date on which Bard accepts the last shipment of SNF Units manufactured by NMT and shipped to Bard pursuant to Bard's final Purchase Order submitted to NMT under Section 4.2 hereof and (b) December 31, 2002 (the "Transition Date"), and subject to the production capacity limitations set forth in Section 3.1 hereof, (i) NMT shall manufacture, in strict accordance with the SNF Product Specifications, and shall sell to Bard all SNF Units which Bard shall order from time to time by delivery to NMT of Purchase Orders, and (ii) Bard shall purchase all such ordered SNF Units which NMT shall so manufacture upon delivery of such SNF Units to Bard in accordance with the applicable Purchase Order and this Agreement. NMT's firm price to Bard for each SNF Unit is set forth in Section 3.2 hereto. 2.2. RNF and RC Units. NMT shall also manufacture [**] RNF Units and RC Units in strict accordance with the RNF and RC Product Specifications, and shall deliver such Units to Bard within 90 days after the Commencement Date, without any additional payment or compensation on the part of Bard. 2.3. Manufacturing Standards and Procedures. NMT shall adopt quality assurance procedures and perform periodic quality control tests adequate to ensure that all Products manufactured hereunder conform to QSR/GMP and the applicable Product Specifications (collectively the "QA Procedures"). At the request of Bard, NMT shall promptly submit to Bard in writing a description of its QA Procedures and shall adopt such additional QA Procedures as Bard may reasonably request. Representatives of Bard may, during normal business hours on at least three business days' notice, visit and inspect NMT's manufacturing facilities and perform such quality control testing of Products as is reasonably necessary or desirable to ensure NMT's compliance with the provisions of this Agreement. 2.4. Inspection by Bard. Bard shall have the right, but not the obligation, to inspect 2 any Product before accepting delivery of, or having an obligation to purchase, that Product. No inspection or other action by Bard shall in any way obligate it to purchase any defective or non-conforming goods or to retain any goods which upon subsequent inspection or use prove to be defective or non-conforming. 2.5. Alteration in Products or Specifications. (a) NMT shall not make any change or alteration in the design or manufacture of any Product (or part thereof) without Bard's prior written consent and shall manufacture each Product fully in accordance with the Product Specifications. (b) If Bard requests a change or alteration in the design or manufacture of any Product (or part thereof), NMT will use commercially reasonable efforts to accommodate such change as promptly as practicable; provided, however, that, except as provided in Section 2.5(c), (i) if any such change or alteration would result in an increase in NMT's manufacturing cost per unit, NMT will inform Bard in advance of such increase and, following such change or alteration, the Price per SNF Unit shall be increased in the amount of such cost increase, and (ii) Bard shall pay NMT for any design or engineering costs incurred by NMT in connection with such requested change or alteration, at a rate agreed to in advance by the parties. (c) If a change or alteration in the design or manufacture of any Product (or part thereof) is required in order to correct a defect in, or a nonconformity to Product Specifications of, such Product (whether such defect or nonconformity is discovered by Bard, by NMT, or by a customer's complaint), NMT shall bear any increased design, engineering, or manufacturing costs incurred in making such change or alteration. 2.6. Audit Rights. Upon request from Bard, NMT will provide Bard with reasonable opportunity, at Bard's expense and during normal business hours, to inspect and audit NMT's books and records relevant to the services provided by NMT to Bard under this Agreement. 3. Pricing and Payment; Minimum SNF Unit Purchase Obligation. 3.1. SNF Production Capacity. NMT will maintain production capacity for the SNF as required to fulfill [**]% of Bard's Minimum SNF Unit purchase obligation (set forth in Section 3.2). NMT will use its commercially reasonable efforts (but shall not be obligated) to satisfy Bard's requests for increased quantities of SNF Units in excess of [**]% of Bard's minimum purchase obligation. 3.2. Minimum SNF Purchases; Purchase Price per Unit. (a) Minimum Purchases. Bard agrees to purchase from NMT Minimum SNF Unit quantities in accordance with the following schedule: 3 ------------------------------------------------------------------------- Shipment Timing Minimum SNF Units --------------- ----------------- ------------------------------------------------------------------------- Before [**] o [**] SNF Units, as set forth in the Purchase Order delivered simultaneously with the execution of this Agreement ------------------------------------------------------------------------- [**] - Transition Date o [**] SNF Units per calendar quarter; provided that in the quarter in which the Transition Date falls, the minimum number of units shall be [**] x (number of days in quarter through the Transition Date / the total number of days in quarter) ------------------------------------------------------------------------- (b) The Price per SNF Unit shall be $[**] for Units shipped before [**] ("Initial Price") and $[**] for Units shipped between [**] and [**] ("Reduced Price"), as set forth on Exhibit 3.2. The Price per SNF Unit shall revert back to the Initial Price for Units shipped after [**] unless NMT shall have (i) failed to deliver the Product Line Documentation to Bard by December 15, 2001, as required by Section 4.14 of the Purchase Agreement or (ii) failed to complete the requirements set forth in Section 9.3(a)(1) hereof by [**], (iii) failed to complete the requirements set forth in Section 9.3(a)(2) hereof by [**]. In such event, the Price per Unit shall remain at the Reduced Price for a number of shipping days beyond [**] that is equal to (x) the number of days beyond December 15, 2001 that NMT shall have failed to deliver the Product Line Documentation plus (y) the number of days beyond [**] that NMT shall have failed to complete the requirements set forth in Section 9.3(a)(1) hereof plus (z) the number of days beyond [**] that NMT shall have failed to complete the requirements set forth in Section 9.3(a)(2) hereof. (c) Bard may, at its option, include on each Purchase Order an order for certain accessories to the SNF Product, which shall be in addition to Bard's purchase of Minimum SNF Units pursuant to Section 3.2(a). The purchase price for these accessories shall be as set forth on Exhibit 3.2(c). 3.3. Bard's Purchase of Raw Materials and Work in Process. In addition to purchasing finished SNF Units pursuant to Purchase Orders delivered hereunder, Bard agrees to take delivery of all raw materials, work in process and packaging materials (for both the SNF and the RNF and RC Products) that NMT has in stock as of the Transition Date to the extent that it does not bear NMT's markings ("Remaining Inventory"), provided that (i) the quantity of such Remaining Inventory for the SNF shall not exceed an amount necessary to manufacture and package [**] finished SNF Units, and (ii) the President or the Chief Financial Officer of NMT shall deliver a certificate to Bard in the form set forth as Exhibit 3.3 with respect to the amount, type, specifications, and quality of such Remaining Inventory. With respect to the Remaining Inventory for the SNF, Bard shall pay NMT at cost (upon NMT's submission to Bard of a certificate setting forth such cost in reasonable detail). The Remaining Inventory for the RNF and the RC shall be delivered to Bard without any additional payment or compensation on the part of Bard. Title and risk of loss or damage for Remaining Inventory shall pass to Bard upon delivery of such items to a facility designated by Bard. NMT will pay all freight and insurance charges on shipments of Remaining Inventory. 3.4. Pricing and Payment. (a) The SNF Price per Unit for each period set forth in Section 3.2(b) shall be firm for the duration of such periods, subject to adjustment pursuant to Section 2.5(b). 4 (b) Prices shall include all taxes and charges, however designated, imposed by any governmental authority on the manufacture, transportation or sale of the Products, including, without limitation, all privilege, excise, sales, use, value-added and property taxes. NMT shall reimburse Bard on demand or, at Bard's request, credit against future purchases, any such taxes or charges which Bard may pay or be requested to pay. (c) Terms of payment shall be net thirty (30) days from the date of shipment, with interest at 1% per month for late payments. 4. Orders and Delivery. 4.1. Terms and Conditions. All orders for Products shall be subject to the terms and conditions set forth in this Agreement. The terms and conditions of this Agreement shall govern all sales of Products by NMT to Bard, and any different, conflicting or additional terms (other than terms as to quantities and proposed delivery dates) in a Purchase Order, invoice or other writing or communication shall be of no force or effect unless they shall constitute a waiver, modification or amendment of this Agreement duly made in accordance with Section 13.1 hereof. Each Purchase Order shall specify a quantity and delivery date. 4.2. Forecasts and Firm Purchase Orders. Bard agrees to submit forecasts and place Purchase Orders for SNF Units as follows: simultaneously with the execution of this Agreement, Bard has provided to NMT a Purchase Order in the form described in Section 4.3 with respect to the purchase of all the SNF Units to be shipped to Bard from the Commencement Date through December 31, 2001, and a non-binding forecast of the number of SNF Units to be delivered to Bard pursuant hereto during the succeeding nine (9) calendar months. Bard may change its non-binding forecast for any month at any time upon written notice to NMT; provided, however, that on the first day of each calendar month (starting with the second full calendar month following the Commencement Date), one additional month's non-binding forecast (as it may have been previously amended) shall become binding and Bard will promptly submit a Purchase Order consistent with the then current forecast for such month. For example, assuming the Commencement Date is September 20, 2001, the remainder of September and the months of October, November and December 2001 will be subject to a binding Purchase Order as of the Commencement Date. The forecast for the month of January, 2002 (as it may have been amended prior to November 1, 2001) will become binding and subject to no further amendment as of November 1, 2001, and the forecast for the month of February, 2002 (as it may have been amended prior to December 1, 2001) shall become binding and subject to no further amendment as of December 1, 2001. 4.3. Contents of Purchase Orders. All Purchase Orders shall contain the following information: (a) reference to this Agreement; (b) the quantity of SNF Units ordered (and SNF accessories ordered, if applicable); (c) the requested delivery dates; 5 (d) the Price per Unit as determined in accordance with this Agreement; and (e) shipping instructions, including place of delivery. 4.4. Shipping, Packaging and Delivery. (a) NMT shall deliver all Products F.O.B. Bard's facility as designated in the applicable Purchase Order. All Products shall be shipped by NMT by a carrier consistent with the carrier used by NMT for shipments to Bard prior to the date of this Agreement. (b) Packaging will be not less than the quality presently employed by NMT. Packaging shall at all times be able to pass the NSTA standard shipping test. Each shipment shall be accompanied by a certificate of sterilization and certificate of compliance stating that appropriate inspection and testing has confirmed compliance to all specifications prepared in connection with any filing with the FDA or submitted to the FDA or any regulatory authority for the Products in the shipment. (c) NMT shall mark each Product with appropriate patent and trademark notices as reasonably required by Bard and pursuant to the laws of the United States or any foreign country in which SNF packages or other Products are sold. Color of package and labeling may be designated by Bard. 5. Representations of NMT. NMT represents and warrants to Bard (i) that NMT has and will have manufacturing plant capacity for the SNF as required to fulfill Bard's Minimum SNF Unit purchase obligation (set forth in Section 3.2) plus[**]%; (ii) that NMT and NMT's employees are subject to no conflicting obligations with respect to discoveries, confidentiality or non-competition which could affect the manufacture or sale of Products for Bard, and (iii) that NMT will comply with all applicable laws in connection with the manufacture and sale of the Products. 6. Warranties. 6.1. Subject to the following provisions, NMT warrants that each of the Products shall conform to the applicable Product Specifications. Subject to compliance with the last sentence of this Section 6.1 and with the provisions of Section 6.2, Bard shall be entitled, at its option, to replacement or refund of the purchase price of any Products which are reasonably determined by Bard to be non-conforming or defective, such replacement or refund to be made by NMT prior to or concurrently with the next scheduled shipment of Products to Bard or within thirty (30) days after notice by Bard that such Products are non-conforming or defective, whichever occurs earlier. Transportation, packaging and storage charges and risk of loss in the storage and disposal of defective or non-conforming Products and in the shipment of replacement Products to Bard shall be borne by NMT. At its option, Bard may take any refund hereunder as a credit against further payments otherwise due to NMT. Bard agrees to give NMT notice of non-conforming or defective Products within thirty (30) days after Bard receives shipment of such Products. 6.2. NMT shall have thirty (30) days after notice from Bard that any Product is non-conforming or defective to conduct, through its duly authorized representative, an inspection of such Product at a location designated by NMT and to dispose thereof in its discretion, subject in 6 each case to Bard's rights to receive a replacement, refund or credit prior to any disposition. Upon the expiration of such thirty-day period Bard shall be entitled to dispose of any non-conforming or defective Products remaining at such location in its discretion, at the expense of NMT, and without any penalty or obligation to NMT. NMT will notify Bard promptly if it disputes Bard's determination that a Product is non-conforming or defective, and the parties will work in good faith to resolve any such dispute. In the event the parties fail to resolve such dispute, the parties shall proceed to resolve such dispute in the manner set forth in Section 9.5 of the Purchase Agreement. 6.3. NMT warrants any replacement Products supplied pursuant to this Section 6, and any out-of-warranty Products replaced, repaired or modified by NMT, on the same basis as it warrants new Products under Section 6.1. After the Transition Date, since Seller will not be in a position to repair or replace Products pursuant to its warranty, its warranty obligation will be limited to refunding the purchase price paid by Bard for such Product. 6.4. In the event that Bard accepts returns from customers or gives credits to customers relating to complaints about the Products manufactured by NMT, NMT and Bard will follow the guidelines for returns and complaint credits that they have followed previous to this Agreement. 6.5. EXCEPT AS EXPRESSLY PROVIDED HEREIN, NMT DOES NOT WARRANT THE MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE OF THE PRODUCTS OR THEIR PERFORMANCE, DOES NOT MAKE ANY WARRANTY, EXPRESS OR IMPLIED, WITH RESPECT TO PRODUCTS, SPECIFICATIONS, SUPPORT, SERVICE OR ANYTHING ELSE AND DOES NOT MAKE ANY WARRANTY TO BARD CUSTOMERS OR AGENTS. NMT SHALL NOT BE LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL LOSS, DAMAGE OR EXPENSE, INCLUDING LOSS OF PROFIT DIRECTLY OR INDIRECTLY ARISING FROM THE SALE OR USE OF PRODUCTS, EXCEPT WHERE SUCH LOSS, DAMAGE OR EXPENSE IS CAUSED BY NMT'S WILFUL OR GROSSLY NEGLIGENT BREACH HEREOF. 7. Bard's Logo Identifications. All Products provided to Bard hereunder shall bear solely such trademarks, service marks, trade names and logo identifications as Bard shall specify and no others. NMT shall have no right or license to use any such trademark, service mark, trade name or logo identification (other than to affix them to the Products sold to Bard hereunder) and shall not use them on or with respect to any product or service provided to any Person other than Bard. All goodwill relating to or developed with respect to any such trademark, trade name or logo identification shall belong exclusively to Bard or its affiliates. 8. Indemnification. NMT's obligation to indemnify Bard for breaches of warranty hereunder, infringement of intellectual property rights of others, and products liability shall be governed by the Purchase Agreement. 9. License; Transfer of Manufacturing; Machinery and Equipment. 9.1. Limited License. Bard will purchase from NMT, pursuant to the Purchase Agreement, all Intellectual Property Rights (as defined in the Purchase Agreement) related to the 7 Products and all Machinery and Equipment (as defined in the Purchase Agreement) used in connection with the Products. Bard hereby grants to NMT a non-exclusive license in and to the Intellectual Property Rights and an exclusive license to use the Machinery and Equipment, but only to the extent that such Intellectual Property Rights and the Machinery and Equipment are necessary to enable NMT to perform its obligations hereunder. Such licenses shall be royalty-free and shall expire upon the expiration or earlier termination of this Agreement. 9.2. Transition Assistance. It is understood that, following the Transition Date, Bard intends to manufacture and produce the Products itself or with another third party. NMT agrees to provide reasonable cooperation to Bard in order to effectuate the orderly transition of the manufacture of the Products from NMT to Bard or its designee, and the parties agree to work in good faith to establish a mutually agreeable transition plan ("Transition Plan"). Without limiting the generality of the foregoing, NMT agrees (i) to assign to Bard, upon Bard's request, all vendor and other third party contracts exclusively required to produce the Products and not required by NMT for production of other NMT products, (ii) to cooperate with Bard to provide to Bard alternative sources of supply for any equipment, components or raw materials which cannot be sold or assigned to Bard hereunder, (iii) to provide without charge consultation and other assistance as reasonably requested by Bard to assist Bard in establishing its Product manufacturing operations and research and development capabilities (but in no event shall such assistance exceed an aggregate of [**] hours), and (iv) to permit Bard personnel to observe the manufacturing process at NMT's manufacturing facilities (provided that no more than five (5) Bard representatives shall be entitled to observe at any one time). NMT's obligation to provide assistance under this Section 9.2 shall commence on the Effective Date and continue for 90 days after the date on which Bard commences in-house or other third party manufacturing of the SNF. Notwithstanding anything to the contrary contained herein, Bard agrees to reimburse NMT for all reasonable out-of-pocket expenses incurred in connection with NMT's compliance with this Section 9.2 to the extent that such expenses are approved in advance by Bard. 9.3. Manufacturing Process Requirements. (a) Manufacturing Process Enhancements. NMT agrees to complete the following manufacturing process enhancements on or before the dates set forth below: (1) By [**]: (A) Qualify and validate salt bath annealing process and equipment for SNF production; (B) Qualify and validate SNF plasma welder for RNF production; (C) Convert all manufacturing drawings from Microstation to SolidWorks; (D) Qualify and validate capital equipment required (assuming completion of items A-C above) to produce the SNF at production rates equal to the production rates required by this Agreement (i.e. [**] SNF units/year) and to produce the RNF and RC; provided however that Bard will purchase any SNF jigs required beyond the [**] SNF jigs already in NMT's possession; 8 (E) All process and testing software shall be validated through the most up-to-date revision of the manufacturing processes for both SNF and RNF production; (F) Complete and transfer the RNF project to production (using the most up-to-date revision of the manufacturing processes), with completed process validation and qualification; and (G) Update the Product Line Documentation (as defined in the Purchase Agreement) to reflect the enhancements required by this Section 9.3(a). (2) By [**], purchase automated grinding equipment for the SNF and qualify and validate automated grinding for both SNF and RNF production. (b) Further Product Line Documentation Updates. In addition to updating the Product Line Documentation as required by Section 9.3(a)(1)(G), NMT will update the Product Line Documentation from time to time to reflect all other improvements, enhancements or modifications to the Products and the manufacturing processes that NMT may develop during the term of this Agreement, such updates to be completed as promptly as practicable after such improvements, enhancements or modifications are developed. (c) Ownership of Enhancements. Bard shall own all right, title and interest in and to all improvements, enhancements and modifications to the Products and the manufacturing process developed by NMT during the term hereof, and all documentation, machinery and equipment reflecting such improvements, enhancements and modifications. NMT hereby assigns to Bard such rights as it otherwise would have had in such improvements, enhancements, modifications and documentation, and agrees to execute such instruments of assignment and transfer and other documents as Bard shall reasonably request to confirm, reflect and ensure Bard's ownership thereof. 9.4. Machinery and Equipment. (a) Maintenance, Repair and Replacement. Bard will purchase from NMT, at the Closing of the transactions contemplated by the Purchase Agreement, all Machinery and Equipment (as defined in the Purchase Agreement) used in connection with the Products and as listed on Exhibit 9.4 hereof. To enable NMT to perform its duties hereunder, Bard has licensed the Machinery and Equipment to NMT for use during the term of this Agreement. NMT agrees that, during the Term of this Agreement, it shall be responsible, at its cost, for the maintenance and repair (and, if necessary, replacement) of the Machinery and Equipment, in accordance with the standards of upkeep, maintenance, repair and replacement at least equal to the standards which NMT maintained for such Machinery and Equipment prior to the date of this Agreement. Until NMT delivers the Machinery and Equipment to Bard in accordance with Section 9.4(b) below, NMT shall bear all risk of loss with respect to all Machinery and Equipment and shall keep the same insured against such loss as it deems to be appropriate. 9 (b) Delivery of Machinery and Equipment to Bard. NMT will deliver the Machinery and Equipment to Bard in accordance with a schedule to be set forth in the Transition Plan. Such Machinery and Equipment shall be in substantially the same condition, reasonable wear and tear excepted, as it was on the Commencement Date. Risk of loss or damage for the Machinery and Equipment shall pass to Bard upon delivery of such items to a facility designated by Bard. NMT will pay all freight and insurance charges on the delivery of the Machinery and Equipment to Bard. (c) No Liens. NMT will maintain the Machinery and Equipment free from all liens and encumbrances (other than any liens or encumbrances incurred by Bard), and shall execute UCC-1 Financing Statements and such other documents as Bard may reasonably request to provide NMT's creditors with notice of Bard's ownership thereof. 10. Term and Termination. 10.1. Term. If not earlier terminated in accordance with this Section 10, this Agreement shall have a term (the "Term") commencing on the Effective Date and continuing until the Transition Date, provided that the provisions of Section 9.2 and 9.4 shall survive and continue for a period not to exceed 90 days after the date on which Bard commences in-house or other third party manufacturing of the SNF. 10.2. Termination under Certain Circumstances. Either party may terminate this Agreement by written notice to the other party following the occurrence of any of the following events: (a) if the other party ceases doing business as a going concern, becomes insolvent, or makes an assignment for the benefit of creditors; or (b) if the other party files a petition for reorganization or bankruptcy under the United States Bankruptcy Code or any other similar law of any other jurisdiction, or if any petition for reorganization or bankruptcy under such Code or under any other similar law of any other jurisdiction is filed against the other party and is not dismissed or vacated within thirty (30) days thereafter. 10.3. Termination by NMT. NMT agrees that this Agreement shall terminate (i) only through expiration of the Term of this Agreement as set forth in Section 10.1 or termination as set forth in Section 10.2 hereof, (ii) by agreement of both parties hereto or (iii) at the option of NMT in the event that Bard shall fail to pay the purchase price of any Product within thirty (30) days after its receipt of written notice from NMT that such payment is due and unpaid and that NMT intends to terminate this Agreement if such payment remains unpaid after the end of the 30-day notice period; provided, however, that NMT shall not be entitled to terminate this Agreement pursuant to this section if NMT is in material breach of its obligations hereunder (including delivery of non-conforming or defective Products) In the event of any breach of this Agreement by Bard other than a breach described in the immediately preceding sentence, NMT shall have no right to terminate this Agreement, and damages and equitable relief prohibiting further such breaches shall be its sole remedies for any other breach of any term or condition hereof. 10 10.4. Termination by Bard. Bard may terminate this Agreement if NMT is in material breach of any provision of this Agreement and has failed to cure such breach within thirty (30) days after receipt of written notice thereof from Bard alleging the breach, provided, however, that Bard shall not be entitled to terminate this Agreement pursuant to this section if Bard is in material breach of its obligations hereunder. 10.5. Possession of Machinery and Equipment. Upon any termination hereof, NMT agrees to deliver the Machinery and Equipment to Bard, in the manner set forth in Section 9.4(b), within 10 days of such termination. If NMT fails to so deliver the Machinery and Equipment, Bard may enter NMT's premises in order to take immediate possession thereof. 11. Rights in Technology. 11.1. Written Work Product and Inventions Owned by Bard. The parties agree that (i) the copyright and other proprietary rights in any and all written materials, including, without limitation, machine-readable materials and documentation and materials which form part of the Products (hereinafter called "Written Work Product"), and (ii) any and all inventions, improvements or discoveries relating to the Products ("Inventions"), in each case that are conceived, developed or reduced to practice during the term of and in the performance of the terms and conditions of this Agreement by the employees of either party, shall be owned by Bard, subject to the license granted to NMT hereunder. NMT will promptly notify Bard in writing of any Written Work Product or Invention conceived, developed or reduced to practice by any employee of NMT, such notification to contain a copy of the Written Work Product or a reasonably detailed description of the Invention that is the subject of the notice. 11.2. No Other Licenses. Except as provided in this Agreement for licenses from Bard to NMT, no license by either NMT or Bard to the other under any patents, copyrights, proprietary rights or trade secrets now owned or hereafter obtained is granted or implied either by this Agreement or by furnishing any information or equipment hereunder to that party. 12. Confidential Information. 12.1. As used herein, "Confidential Information" shall mean any plan, design, configuration, style or concept of any Product, any scientific, technical, merchandising, production or management design, procedure, formula, discovery, invention, item of information, idea, concept or improvement or any customer or supplier list (and any tangible evidence, record or representation of any of the foregoing), which is maintained in secrecy or confidence by either NMT or Bard or by any person or entity affiliated with NMT or Bard, which might permit NMT or Bard or any of their respective customers to obtain a competitive advantage over competitors who do not have access thereto and which is provided by NMT or Bard to the other hereunder in reliance on the agreements of the party receiving the Confidential Information (the "Receiving Party") herein. 12.2. The foregoing notwithstanding, the obligations of this Section 12 shall not apply with respect to any information, data or other material described above, which is (a) known to the Receiving Party at the time of disclosure; or 11 (b) is or becomes publicly known or otherwise enters the public domain through no wrongful act by the Receiving Party; or (c) is received by the Receiving Party from a third party which has no obligation to the other party to maintain the information in confidence; or (d) is subsequently developed independently by the Receiving Party without use of any information, data or other material of the other party which is confidential and protected hereunder. 12.3. Each Receiving Party shall at all times hold confidential in accordance with this Section all of the Confidential Information received by it from the other party. Each Receiving Party shall use such care in the prevention of disclosure of the other party's Confidential Information as the Receiving Party uses in the protection of its own information and materials of like kind and sensitivity. NMT shall not use any Confidential Information or any derivative or variation thereof except to process Purchase Orders and Product Specifications for Bard and to manufacture Products for Bard. 12.4. Each Receiving Party shall give access to the Confidential Information of the other party only to such of the Receiving Party's employees or other persons as are engaged in (i) in the case of NMT as the Receiving Party, processing Purchase Orders or Product Specifications for Bard, performing development work on the Products hereunder or manufacturing the Products for Bard and (ii) in the case of Bard as the Receiving Party, in its business relating to the Products or similar products. NMT and Bard each agree further that before gaining access to any Confidential Information, each such employee or person shall be advised of the confidential nature of the Confidential Information of the other party and of the existence and importance of this Agreement and shall enter into a written confidentiality agreement prohibiting any use or disclosure of any of the Confidential Information except in accordance with this Agreement. 12.5. This Agreement shall not be construed to grant to either NMT or Bard any license or other rights in any Confidential Information of the other except as expressly set forth herein. 12.6. The foregoing notwithstanding, NMT and Bard agree that the obligations set forth above shall not apply to any part of any Product sold or to be sold by Bard or to any customer or service manuals or documentation prepared in connection with the sale, marketing or service of any Product and that no obligation of confidentiality or restriction on use shall bind or limit any customer or potential customer for any of the Products in such Person's capacity as such. 12.7. NMT and Bard each acknowledge that money damages alone will not adequately compensate the other for breach of any of the covenants and agreements in this Section 12 and, therefore, agree that in the event of the breach or threatened breach of any such covenant or agreement, in addition to all other remedies available to the other party, at law, in equity, or otherwise, such other party shall be entitled to injunctive relief compelling specific performance of, or other compliance with, the terms hereof. 12 12.8. In the event that any provision of this Agreement shall be determined to be unenforceable by any court of competent jurisdiction by reason of its extending for too great a period of time or over too large a geographic area or over too great a range of activities, it shall be interpreted to extend only over the maximum period of time, geographic area or range of activities as to which it may be enforceable. 13. Miscellaneous. 13.1. Waivers and Amendments. (a) This Agreement may be amended, modified or supplemented only by a written instrument executed by the parties hereto. (b) No waiver of any provision of this Agreement, or consent to any departure from the terms hereof, shall be effective unless the same shall be in writing and signed by the party waiving or consenting thereto. No failure on the part of any party to exercise, and no delay in exercising, any right or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or remedy by such party preclude any other or further exercise thereof or the exercise of any other right or remedy. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate as a waiver of any subsequent breach. All rights and remedies hereunder are cumulative and are in addition to and not exclusive of any other rights and remedies provided by law. 13.2. Entire Agreement. This Agreement and the Related Documents (as such term is defined in the Purchase Agreement) constitute the entire agreement among the parties hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, whether written or oral, among the parties, or any of them, in connection with such subject matter. 13.3. Relationship of the Parties. This Agreement shall not constitute NMT the agent or legal representative of Bard for any purpose whatsoever, and NMT shall not hold itself out as an agent of Bard. This Agreement creates no relationship of joint adventurers, partners, associates, employment or principal and agent between the parties, and both parties are acting as independent contractors. Neither NMT nor Bard is granted herein any right or authority to, and shall not attempt to, assume or create any obligation or responsibility for or on behalf of the other. Neither NMT nor Bard shall have any authority to bind the other to any contract, whether of employment or otherwise, and, NMT and Bard shall bear all of their respective expenses for their operations, including, without limitation, the compensation of their employees and salesmen and the maintenance of their offices, service and warehouse facilities. NMT and Bard shall each be solely responsible for their own employees and salesmen and for their acts and the things done by them. 13.4. No Rights Granted. Nothing in this Agreement shall operate to confer on NMT the right to use any trademark, service mark, trade name or logo identification now or hereafter used by Bard whether or not registered, without the written consent of Bard. 13.5. Time of Essence. Time shall be of the essence of each Party's performance hereunder. 13 13.6. Assignment. Neither this Agreement nor any right or obligation hereunder shall be assigned or delegated by either party, voluntarily or by operation of law, without the prior written consent of the other party, which consent may be withheld for any reason, provided, however, that Bard may assign this Agreement and delegate its obligations hereunder in full to any Person which shall acquire the Product Line or to any majority-owned subsidiary of Bard or any Affiliate of Bard if the assignee shall assume Bard's obligations hereunder in writing. Any attempted assignment in violation of the immediately preceding sentence shall be null and void. For purposes of this Section 13.6 with respect to Bard, an assignment shall not be deemed to occur in the event of a sale or transfer of substantially all of the assets of, or a majority interest in the voting shares of, Bard to, or the merger or consolidation of Bard with or into, any other Person. 13.7. Dispute Resolution; Arbitration. All differences, disputes or claims arising in connection with this Agreement or any transaction or occurrence contemplated hereby shall be settled in the manner set forth in Section 9.5 of the Purchase Agreement. 13.8. Governing Law. This Agreement shall be governed by, and construed and enforced in accordance with, the substantive laws of The Commonwealth of Massachusetts, without giving effect to its conflicts of laws rules. 13.9. No Election of Remedies. The rights and remedies accorded herein to NMT and Bard are cumulative and in addition to those provided by law, and may be exercised separately, concurrently, or successively. 13.10. Notices. Any notice or other communication in connection with this Agreement shall be in writing and shall be sufficiently given if sent in accordance with Section 10.9 of the Purchase Agreement. 13.11. Survival. The provisions of Sections 11, 12, 13.7, 13.8, 13.9 and this 13.11 shall survive the expiration or earlier termination of this Agreement. 13.12. Force Majeure. In the event that the delay or failure of a party to comply with any obligation created by this Agreement is caused by Force Majeure, that obligation shall be suspended during the continuance of the Force Majeure condition. The term "Force Majeure" shall mean any event beyond the reasonable control of the parties, including without limitation, fire, riots, strikes, epidemics, war (declared or undeclared) and embargoes, but shall not include flooding. * * * * * The remainder of this page has been intentionally left blank 14 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed in their names by their properly and duly authorized officers or representatives as of the date first above written. NMT MEDICAL, INC. C.R. BARD, INC. By: John E. Ahern By: Robert Mellen -------------------------------- -------------------------------- President and CEO President, Bard Peripheral Technologies, a division of C.R. Bard, Inc. 15 Exhibit 3.2(c) - ------------------------------------------------------------------------------- Unit Price - ------------------------------------------------------------------------------- Bard Code Description Initial Reduced - ------------------------------------------------------------------------------- 2120F Simon Nitinol Filter-Femoral-Straight Line $[**] $[**] Delivery System - ------------------------------------------------------------------------------- Simon Nitinol Filter-Jugular-Straight Line 2220J Delivery System $[**] $[**] - ------------------------------------------------------------------------------- 2320A Simon Nitinol Filter-Antecubital-Straight $[**] $[**] Line Delivery System - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 2110F Simon Nitinol Filter-Femoral-Hoop Delivery $[**] $[**] System - ------------------------------------------------------------------------------- Simon Nitinol Filter-Jugular-Hoop Delivery 2210J System $[**] $[**] - ------------------------------------------------------------------------------- 2310A Simon Nitinol Filter-Antecubital-Hoop $[**] $[**] Delivery System - ------------------------------------------------------------------------------- - ------------------------------------------------------------------------------- 3120F SNF Introducer $[**] $[**] - ------------------------------------------------------------------------------- 3220J SNF Introducer $[**] $[**] - ------------------------------------------------------------------------------- 3320A SNF Introducer $[**] $[**] - ------------------------------------------------------------------------------- 16 Exhibit 3.3 CERTIFICATION AS TO REMAINING INVENTORY The undersigned NMT Medical, Inc., hereby certifies to C.R. Bard, Inc. as follows: 1. The Remaining Inventory consists of the following (specify amount and type): 2. The raw materials in the Remaining Inventory, and the materials used in the manufacture of the work in process in the Remaining Inventory, conform to the most current revision of the manufacturing process (as defined in Section 9.3 of the Transitional Manufacturing Agreement) and are of the same quality as the materials used by NMT in the manufacture of the Units purchased by or delivered to Bard under the Transitional Manufacturing Agreement; 3. The Remaining Inventory (to the extent that it is work in process) conforms to the most current revision of the Product Specifications applicable to the relevant stage of the manufacturing process, incorporates the most current revision of the manufacturing process (as defined in Section 9.3 of the Transitional Manufacturing Agreement) and is free from defects in materials and workmanship. NMT MEDICAL, INC. By: ____________________________________ Title:__________________________________ 17 EX-99.1 7 dex991.txt PRESS RELEASE DATED 11/05/2001 Exhibit 99.1 NEWS BULLETIN RE: NMT Medical, Inc. FROM: 27 Wormwood Street Boston, MA 02210-1625 (Nasdaq/NMS:NMTI) FRB|Weber Shandwick - -------------------------------------------------------------------------------- FOR FURTHER INFORMATION AT THE COMPANY AT FRB WEBER SHANDWICK - -------------- ---------------------- Richard E. Davis General Info: Alison Ziegler Vice President and CFO Analyst Info: Julie Tu (617) 737-0930 Media Info: Judith Sylk-Siegel (212) 445-8400 NMT MEDICAL ANNOUNCES SALE OF VENA CAVA FILTER ASSETS ----------------------------------------------------- BOSTON, Nov. 5, 2001-- NMT Medical, Inc. (Nasdaq: NMTI - news) announced today that it has sold assets comprising NMT's vena cava filter business to C.R. Bard, Inc. (NYSE: BCR - news). As was announced on October 19, 2001, in exchange for these assets, NMT will receive $27 million in upfront cash payments, of which $8.5 million was paid at closing and the remainder will be paid on or about January 2, 2002. Under the agreement with Bard, NMT will receive up to an additional $7 million in cash upon the achievement of certain NMT performance and delivery milestones. In addition to these cash payments, NMT will receive ongoing royalty payments from Bard on sales of vena cava filter products and will continue to manufacture the product for an interim period of time. With the proceeds from the sale, NMT repaid in full its senior subordinated debt to Whitney & Co. in the aggregate amount of approximately $4.5 million. In addition, NMT paid $2.25 million and issued 40,000 shares of its common stock to The Beth Israel Deaconess Medical Center in exchange for an assignment of all of Beth Israel's rights with respect to the technology underlying the vena cava filter business and a general release of claims. NMT and Dr. Morris Simon, a member of the board of directors of NMT, have exchanged letters disputing, among other things, rights to royalty payments relating to the sale of products in the vena cava filter business. In this correspondence, the parties have indicated an intention to arbitrate these disputes but no hearings have been scheduled to date. NMT Medical designs, develops and markets innovative medical devices that utilize advanced technologies and are delivered by minimally invasive procedures. The Company's products are designed to offer alternative approaches to existing complex treatments, thereby reducing patient trauma, shortening procedure, hospitalization and recovery times, and lowering overall treatment costs. The Company's cardiovascular business unit provides the interventional cardiologist, interventional radiologist, and vascular surgeon with proprietary catheter-based implant technologies that minimize or prevent the risk of embolic events. The cardiovascular business unit also serves the pediatric interventional cardiologist with a broad range of cardiac septal repair implants delivered with nonsurgical catheter techniques. The NMT neurosciences business unit serves the needs of neurosurgeons with a range of implantable and single-use products, including cerebral spinal fluid shunts, external drainage products, and aneurysm clips. This press release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements, including statements regarding the ability of the Company to satisfy performance and delivery milestones, the receipt of royalty payments on sales by C.R. Bard, Inc. and the arbitration with Dr. Simon, involve known and unknown risks, uncertainties or other factors which may cause actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Factors that might cause such a difference include, but are not limited to, those discussed under the heading "Certain Factors That May Affect Future Results" included in the Management's Discussion and Analysis of Financial Condition and Results of Operations in the Company's Annual Report on Form 10-K for the year ended December 31, 2000, as amended and subsequent filings with the Securities and Exchange Commission. For additional information on NMT Medical, Inc., please visit the Company's website at www.nmtmedical.com. ------------------- ### FRB Weber Shandwick serves as financial relations counsel to this company, is acting on the company's behalf in issuing this bulletin and receiving compensation therefor. The information contained herein is furnished for information purposes only and is not to be construed as an offer to buy or sell securities. -----END PRIVACY-ENHANCED MESSAGE-----