Citi noted that
the 52-week trading range, equity research analyst price targets and implied premia analyses below with respect to Corindus are
not valuation methodologies and were presented for reference only.
Citi reviewed the
historical intra-day share prices of Corindus common stock for the 52-week period ended August 6, 2019. Citi noted that the low
and high closing share prices during this period were $0.78 and $3.49 per share of Corindus common stock, respectively.
Citi reviewed the
most recent publicly available research analysts’ one-year forward price targets for the Corindus common stock prepared and
published by selected research analysts. Citi noted that as of August 6, 2019 such price targets ranged from $2.00 to $4.00. Citi
also noted that this range of price targets, discounted one year at a 11.6% cost of equity, was $1.80 to $3.60.
Corindus has agreed
to pay Citi for its services in connection with the merger an aggregate fee of approximately $23.6 million, $3 million of which
became payable upon delivery of Citi’s opinion to the Board, and the remainder of which is payable contingent upon the consummation
of the proposed merger. In addition, Corindus agreed to reimburse Citi for expenses incurred by Citi in performing its services,
and to indemnify Citi and related parties against certain liabilities, including liabilities under federal securities laws, arising
out of Citi’s engagement.
As the Board also
was aware, Citi and its affiliates in the past have provided and in the future may provide certain investment banking, commercial
banking and other financial services to Siemens AG, the majority shareholder of Healthineers, and affiliates of Siemens AG unrelated
to the proposed merger, for which services Citi and its affiliates have received and expect to receive compensation, including,
during the two-year period prior to the date of Citi’s opinion, having acted or acting as joint bookrunner in connection
with the initial public offering of Healthineers by Siemens AG; and as lead arranger, administrative agent and/or bookrunner in
connection with certain investment grade loans and investment grade bond issuances of Siemens AG. For the services described above
for Corindus, Citi and its affiliates received during the two-year period prior to the date of Citi’s opinion aggregate
fees of approximately $12 million. In the ordinary course of Citi’s business, Citi and its affiliates may actively trade
or hold the securities of Corindus, Healthineers, Siemens AG and their respective affiliates for its own account or for the account
of its customers and, accordingly, may at any time hold a long or short position in such securities. In addition, Citi and its
affiliates (including Citigroup Inc. and its affiliates) may maintain relationships with Corindus, Healthineers, Siemens AG and
their respective affiliates.
Corindus selected
Citi as a financial advisor in connection with the merger based on Citi’s reputation, experience and familiarity with Corindus
and its business. Citi is an internationally recognized investment banking firm that regularly engages in the valuation of businesses
and their securities in connection with mergers and acquisitions and other purposes.
Corindus management
maintains longer range financial projections for internal budgeting and planning purposes, which Corindus management reviews with
the Board from time to time. However, Corindus does not in the ordinary course make public projections as to future performance,
earnings or other results and is especially cautious of making financial forecasts for extended periods because of the unpredictability
of the underlying assumptions and estimates. However, in connection with the Board’s evaluation of the proposed merger, our
management prepared certain, unaudited, stand-alone, financial forecasts regarding our anticipated future operations, for fiscal
years 2019 through 2024 which we refer to as “Financial Projections,” described below.
Our management
provided the Financial Projections to the Board for their review in connection with the Board’s evaluation of the proposed
merger, and to Citi, our financial advisor in connection with the proposed merger. Our management also provided the Financial Projections
to SMS USA. The Company advised the recipients of the Financial Projections that its internal financial forecasts upon which the
Financial Projections were based are subjective in many respects. The Financial Projections reflected numerous assumptions with
respect to company performance, industry performance, general business, economic, market and financial conditions, competitive
and regulatory conditions, and other matters, many of which are difficult or impossible to predict accurately, are subject to significant
economic, regulatory and competitive uncertainties and are beyond the Company’s control. The Financial Projections also reflect
assumptions as to certain business decisions that are subject to change. As a result, there could be no assurance that the Financial
Projections will be realized or that actual results will not be significantly higher or lower than projected.
The Financial Projections
were developed for internal use and for use by our financial advisor with respect to their due diligence investigation of the Company,
and were not prepared with a view toward public disclosure and do not necessarily comply with published guidelines of the SEC,
the guidelines established by the American Institute of Certified Public Accountants for preparation and presentation of financial
forecasts or U.S. Generally Accepted Accounting Principles (“U.S. GAAP”). Our independent registered public accounting
firm has not audited, reviewed, compiled or performed any procedures with respect to the Financial Projections, and does not express
an opinion or any form of assurance related thereto. Such non-U.S. GAAP financial measures should not be considered in isolation
from, or as a substitute for, financial information presented in compliance with U.S. GAAP, and such non- U.S. GAAP financial measures
as used by Corindus may not be comparable to similarly titled amounts used by other companies. The Financial Projections and summaries
of the Financial Projections are not being included in this proxy statement to influence any Corindus stockholder’s decision
whether to vote for the merger, but are being included because they were made available to the Board and our financial advisor
for their respective evaluation of the proposed merger. The Financial Projections are not intended to be considered as public guidance
of our financial performance or to be an assurance of the achievement of future results.
The Financial Projections,
while presented with numerical specificity, necessarily were based on numerous estimates, variables and assumptions that are inherently
uncertain and many of which are beyond our control. Because the Financial Projections cover multiple years, by their nature, they
become subject to greater uncertainty with each successive year. Furthermore, the Financial Projections do not take into account
any circumstances or events occurring after the date they were prepared, including the announcement of the potential acquisition
of Corindus by SMS USA pursuant to the merger agreement or our compliance with our covenants under the merger agreement. Important
factors that may affect actual results and result in the Financial Projections not being achieved include, but are not limited
to, the risk factors described in our annual report on Form 10-K for the fiscal year ended December 31, 2018, subsequent quarterly
reports on Form 10-Q and current reports on Form 8-K. In addition, the Financial Projections may be affected by our ability to
achieve strategic goals, objectives and targets over the applicable period.
The Financial Projections
are forward-looking statements. Financial Projections of this type are based on estimates and assumptions that are inherently subject
to factors such as company performance, industry performance, general business, economic, regulatory, market and financial conditions,
as well as changes to the business, financial condition or results of operations of the Company, including the factors described
in the section entitled “Cautionary Statement Regarding Forward-Looking Statements” beginning on page 23 of
this proxy statement. Such factors may cause the Financial Projections or the underlying assumptions to be inaccurate.
Accordingly, there
can be no assurance that the Financial Projections will be realized, and actual results may vary materially from those shown. The
inclusion of the Financial Projections in this proxy statement should not be regarded as an indication that we or any of our affiliates,
advisors, including Citi, or representatives considered or consider the Financial Projections to be predictive of actual future
events, and they should not be relied upon as such. Neither we nor any of our affiliates, advisors, officers, directors or representatives
can give any assurance that actual results will not differ from the Financial Projections and none of them undertakes any obligation
to update or otherwise revise or reconcile the Financial Projections to reflect circumstances existing after the respective dates
on which they were prepared or to reflect the occurrence of future events even in the event that any or all of the assumptions
underlying the Financial Projections are shown to be in error. We do not intend to make publicly available any update or other
revision to the Financial Projections, except as otherwise required by law.
The following table
sets forth a summary of the Financial Projections and certain historical financial information for comparison purposes:
Readers of this
proxy statement are cautioned not to place undue reliance on the specific portions of the Financial Projections set forth above.
Neither we nor any of our affiliates, advisors, officers, directors or representatives has made or makes any representation to
any Corindus stockholder or other person regarding our ultimate performance compared to the information contained in the Financial
Projections or that the Financial Projections will be achieved, or otherwise regarding the information included in the Financial
Projections. We have made no representation to SMS USA in the merger agreement or otherwise concerning the accuracy or reliability
of the Financial Projections.
When considering
the recommendation of the Board that you vote to approve the merger proposal, you should be aware that, aside from their interests
as Corindus stockholders, Corindus’ directors and executive officers have interests in the merger that are different from,
or in addition to, the interests of Corindus stockholders generally. This includes, for instance, payments that our directors and
executive officers are entitled to receive in respect of Corindus stock options and restricted stock units, severance payments
and benefits that our executive officers may become entitled to receive in connection with certain terminations, and, in the case
of Mark J. Toland, a one-time transaction bonus, each as described more fully below.
With regard to
our directors serving on the Board (other than Mark J. Toland, whose interest is as an executive officer), these interests relate
to the impact of the transaction on the directors’ outstanding equity awards (which consist of restricted stock units and
stock options) and the provision of indemnification and insurance arrangements pursuant to the merger agreement and Corindus’
certificate of incorporation and bylaws, which reflect that such directors may be subject to claims arising from their service
on the Board.
With regard to
our executive officers, these interests include coverage under indemnification and insurance arrangements, and the possible receipt
of the following types of payments and benefits that may be triggered by or otherwise relate to the merger, assuming the merger
occurred on October 1, 2019 and, where applicable, the executive officers’ employment was terminated by us without “cause”
or, if applicable, by the executive officer for “good reason” (each as defined below) on October 1, 2019:
Corindus’
directors and executive officers will receive the same merger consideration as other stockholders of (i) common stock consideration
for each share of Corindus common stock that they own at the effective time and (ii) the preferred stock consideration for each
share of Corindus preferred stock that they own.
For information
regarding beneficial ownership of Corindus common stock and Corindus preferred stock by each of Corindus’ current directors,
Corindus’ named executive officers and all directors and executive officers as a group, see the section entitled “Security
Ownership of Certain Beneficial Owners and Management” beginning on page 93 of this proxy statement.
As described under
“The Merger Agreement - Treatment of Corindus Equity Awards” beginning on page 70 of this proxy statement, the
merger agreement provides that each option to purchase shares of Corindus common stock and each Corindus restricted stock unit
award will be treated as set forth below. Only our non-employee directors, but not our executive officers, hold restricted stock
units.
Each option to
purchase shares of Corindus common stock that is outstanding and unexercised immediately prior to the effective time, whether vested
or unvested, will be cancelled and converted into the right to receive a cash payment (without interest) equal to the product of
(A) the excess, if any, of the common stock consideration over the per share exercise price of such option, and (B) the number
of shares of Corindus common stock subject to such option as of the effective time, net of any applicable withholding taxes required
to be withheld by applicable law. Options with a per share exercise price equal to or exceeding the common stock consideration
will be cancelled without payment.
Each Corindus restricted
stock unit award that is outstanding immediately prior to the effective time, whether vested or unvested, will be cancelled and
converted into the right to receive a cash payment (without interest) equal to the product of (A) the common stock consideration
and (B) the number of shares of Corindus common stock underlying the award as of the effective time, net of any applicable withholding
taxes required to be withheld by applicable law.
The table below
shows the outstanding options (both vested and unvested) held by our executive officers assuming that the merger closes on October
1, 2019 and, for illustrative purposes, the value our executive officers would receive in respect of these outstanding options
in connection with the merger (assuming that no additional stock options were granted to any such executive officer after the date
of this proxy statement and prior to the merger closing, and that no executive officer exercised any stock options within such
period).
The table below
shows the outstanding options (both vested and unvested) and restricted stock units held by our directors assuming that the merger
closes on October 1, 2019 and, for illustrative purposes, the value our directors would receive in respect of these outstanding
options and restricted stock units in connection with the merger (assuming that no additional equity awards were granted to any
such director after the date of this proxy statement and prior to the merger closing, and that no director exercised any stock
options within such period).
Corindus has employment
agreements with each of its named executive officers that provide for, among other things, severance payments and other benefits
in cases of certain employment termination scenarios, including certain terminations in connection with a “change in control”
(which the merger will constitute). Under the employment agreements, except in the case of Mr. Teany, if (i) the executive’s
employment is terminated by us without “cause,” as described below or (ii) the executive resigns for “good reason,”
as described below, in each case within 12 months following a “change in control” (which the merger will constitute),
then Corindus will pay or provide the executive officers (subject to execution of a release of claims):
Mr. Teany’s
employment agreement does not provide any severance payments or benefits upon termination. Under Mr. Toland’s and Mr. Long’s
employment agreements, the severance payments and benefits are substantially similar to those described above upon a termination
without “cause” or a resignation for “good reason” absent a “change in control,” except that,
in such case, Mr. Toland would receive payment of the portion of his annual bonus accrued on the Company’s books and records
as of the immediately preceding calendar quarter for a period of 12 months in lieu of the target bonus payment described above.
The executive officers
would additionally receive any accrued but unpaid base salary and unreimbursed business expenses through the termination date;
any annual bonus (if any), earned in respect of the calendar year completed prior to the date of termination; and any benefits
provided under any of the Company’s fringe benefit programs in accordance with their terms.
Under the employment
agreements, the executive officers are subject to a perpetual confidentiality covenant and covenants of non-competition and non-solicitation
of Corindus’ employees and independent contractors for the period of their employment and for 12 months (18 months, in the
case of Mr. Long) thereafter.
With respect to
the foregoing employment agreements for Messrs. Toland and Long, “cause”, “change in control” and “good
reason” are defined as follows.
To terminate
Mr. Toland for “cause,” the Board must provide him a reasonable opportunity to cure the event(s) constituting “cause.”
“Change in
control” means the occurrence, in a single transaction or in a series of related transactions, of any one or more of the
following events:
To resign for “good
reason,” Mr. Toland or Mr. Long are required to provide 30 days’ prior written notice within a reasonable period of
time (not to exceed, except in the case of a continuing breach, 90 days) after the event giving rise to “good reason,”
and such event must be uncured after a cure period of at least 30 days.
Corindus has entered
into a transaction bonus letter agreement with Mr. Toland pursuant to which Mr. Toland is entitled to receive a one-time, lump-sum
cash transaction bonus of $2.5 million, payable promptly following, and subject to Mr. Toland’s continued employment through,
the effective time.
From and after
the effective time through the sixth anniversary of the date on which the effective time occurs, SMS USA and the surviving corporation
will jointly and severally indemnify and hold harmless each D&O indemnified party with respect to all claims, liabilities,
losses, damages, judgments, fines, penalties, costs (including amounts paid in settlement or compromise) and expenses (including
fees and expenses of legal counsel) in connection with any proceeding, whenever asserted, based on or arising out of, in whole
or in part, (i) the fact that a D&O indemnified party was a director, officer, employee or agent of Corindus or any of its
subsidiaries, or (ii) acts or omissions by such D&O indemnified party in the D&O indemnified party’s capacity as
a director, officer, employee or agent of Corindus or a subsidiary of Corindus or taken at the request of Corindus or a subsidiary
of Corindus (including in connection with serving at the request of the Corindus or such subsidiary as a director, officer, employee
agent, trustee or fiduciary of another person), in each case under the foregoing clauses (i) or (ii), at, or at any time before,
the effective time (including any proceeding relating in whole or in part to the merger or the enforcement of this provision or
any other indemnification or advancement right of any D&O indemnified party), to the fullest extent permitted or required by
applicable law. In no event will SMS USA have any obligations or liabilities to a D&O indemnified party pursuant to the provisions
described in this paragraph, other than those obligations or liabilities that the surviving corporation will have to D&O indemnified
parties pursuant to the provisions described in this paragraph.
All rights to indemnification
and exculpation from liabilities, including advancement of expenses, for acts or omissions occurring at or prior to the effective
time now existing in favor of the D&O indemnified parties as provided in Corindus’ certificate of incorporation, bylaws,
or any indemnification contract between such D&O indemnified parties and Corindus (and disclosed to SMS USA) will survive the
merger and will continue in full force and effect. Without limiting the foregoing, for a period of six years from the effective
time, the surviving corporation shall, and SMS USA shall cause the surviving corporation to, maintain in effect the exculpation,
indemnification and advancement of expenses provisions equivalent to the provisions of Corindus’ certificate of incorporation
and bylaws as in effect immediately prior to the effective time solely with respect to acts or omissions occurring prior to the
effective time and will not amend, repeal or otherwise modify any such provisions in any manner that would adversely affect the
rights thereunder of any D&O indemnified party; provided, however, that all rights to indemnification in respect
of any action pending or asserted or any claim made for indemnification within such period will continue until the disposition
of such action or resolution of such claim. From and after the effective time, SMS USA shall guarantee and stand surety for, and
shall cause the surviving corporation to honor, in accordance with their respective terms, each of the covenants contained in certain
provisions of the merger agreement relating to directors’ and officers’ indemnification. In addition, for six years
from the effective time, SMS USA will, and will cause the surviving corporation to, advance any expenses (including fees and expenses
of legal counsel) of any D&O indemnified party (including in connection with enforcing the indemnity) as incurred to the fullest
extent permitted under applicable law, provided that the individual to whom expenses are advanced provides an undertaking to repay
such advances if it is determined that such person is not entitled to be so indemnified.
Prior to the effective
time, Corindus is required to or, if Corindus is unable to, SMS USA will cause the surviving corporation as of or after the effective
time to, purchase a six-year prepaid “tail” policy with reputable insurers, with terms, conditions, retentions and
limits of liability that are no less favorable than the coverage provided under Corindus’ existing policies of directors’
and officers’ liability insurance and fiduciary liability insurance, with respect to matters arising on or before the effective
time (including in connection with the merger agreement and the transactions or actions contemplated by the merger agreement),
subject to certain limitations. If Corindus or the surviving corporation for any reason fails to obtain such “tail”
insurance policies prior to, as of or after the effective time, SMS USA is required to, for a period of six years from the effective
time, cause the surviving corporation to maintain in effect the current policies of directors’ and officers’ liability
insurance and fiduciary liability insurance maintained by Corindus with respect to matters arising on or before the effective time,
subject to certain limitations.
As of the date
of this proxy statement, other than the arrangements discussed in this proxy statement, none of our executive officers has entered
into any agreement with SMS USA regarding employment with, or compensation from, the surviving corporation or SMS USA on a going-forward
basis following the completion of the merger. However, SMS USA (or its representatives) and some or all of our executive officers
may have discussions from time to time with respect to such arrangements.
The following table,
“Golden Parachute Compensation,” along with its footnotes, shows the disclosure required by Item 402(t) of Regulation
S-K regarding the amounts of payments and benefits payable to Corindus’ named executive officers that are based on or otherwise
relate to the merger. The amounts detailed below assume that the merger occurred on October 1, 2019 and, where applicable, the
named executive officer’s employment was terminated by Corindus without “cause” or by the named executive officer
for “good reason” on October 1, 2019. The table below takes into account each named executive officer’s outstanding
vested stock options assuming that the merger closes on October 1, 2019 (assuming that no additional stock options were granted
to any such executive officer after the date of this proxy statement and prior to the merger closing, and that no executive officer
exercised any stock options within such period). The actual amounts payable will depend on the effective time of the merger and
the date of such termination, as applicable. More detail on the payments and benefits are set forth above in this section of this
proxy statement.
The information
contained in the following table and accompanying footnotes are subject to a non-binding, advisory vote of Corindus’ stockholders,
as described under the section titled “Advisory Vote on Named Executive Officer Merger-Related Compensation Proposal (Proposal
2)” beginning on page 91 of this proxy statement.
The cash severance
arrangements described above are “double-trigger” (i.e., they become payable only in connection with a qualifying termination,
rather than solely as a result of a change in control (i.e., “single-trigger”)). The one-time, lump-sum transaction
bonus for Mr. Toland is “single-trigger.”
The consummation
of the merger is not subject to any financing conditions. We anticipate that the total amount of funds necessary to consummate
the merger and the related transactions, not including fees and expenses, will be approximately $1.1 billion, including the estimated
funds needed to (i) pay holders of Corindus common and preferred stock their respective common stock consideration or preferred
stock consideration due to them under the merger agreement; (ii) make payments in respect of outstanding Corindus stock options
and Corindus restricted stock unit awards pursuant to the merger agreement; (iii) make payments in respect of outstanding Corindus
warrants pursuant to the merger agreement; and (iv) pay the outstanding net indebtedness of Corindus. SMS USA expects to use cash,
lines of credit or other sources of immediately available funds in order to fund the merger.
In connection with
the execution of the merger agreement, on August 7, 2019, Healthineers delivered the letter of support which was accepted by Corindus,
pursuant to which, Healthineers has agreed, guaranteed and committed to the complete payment and discharge of all monetary obligations
and liabilities of SMS USA to Corindus in accordance with, and arising from, the merger agreement (other than the indemnification
obligations of SMS USA owed to directors and officers of Corindus pursuant to the merger agreement). If SMS USA defaults in the
due and punctual payment of such obligations under the merger agreement, Corindus shall be entitled to seek satisfaction and payment
of such obligations directly against Healthineers up to the Aggregate Merger Consideration after Corindus has first made written
demand for satisfaction and payment of the relevant obligations to SMS USA and the expiry of a grace period of 30 days.
U.S. Antitrust
Under the HSR Act,
we cannot complete the merger until we have given notification and furnished information to the FTC and the DOJ, and until the
applicable waiting period has expired or has been terminated. On August 23, 2019, Corindus and SMS USA each filed a premerger notification
and report form under the HSR Act, as a result of which the applicable waiting period would be expected to expire on September
22, 2019, at 11:59 p.m., Eastern Time, unless otherwise earlier terminated or extended by the antitrust authorities.
No foreign antirust
approvals or merger control approvals are required in connection with the merger.
Under the merger
agreement, Corindus, SMS USA and Merger Sub have agreed to use reasonable best efforts to consummate and make effective the transactions
contemplated by the merger agreement and to cause the conditions to the merger to be satisfied, including obtaining all necessary
actions or non-actions, consents and approvals from governmental authorities or other third parties necessary in connection with
the merger and making all necessary registrations and filings, including under the HSR Act, provided, however, that
no party shall be required to make concessions in connection with seeking or obtaining consent to the merger, including any obligation
to divest, hold separate or otherwise take action that limits such party’s freedom of action.
While we have no
reason to believe it will not be possible to obtain regulatory approvals in a timely manner, there is no certainty that these approvals
will be obtained within the period of time contemplated by the merger agreement, if at all.
The approval
of any regulatory application or completion of regulatory review merely implies the satisfaction of certain regulatory
criteria, which do not include review of the merger from the standpoint of the adequacy of the applicable merger
consideration to be received by Corindus stockholders. Further, regulatory approvals or reviews do not constitute an
endorsement or recommendation of the merger.
The exchange
of Corindus common stock for cash in the merger will be a taxable transaction for U.S. federal income tax purposes and may
also be taxable under state and local and other tax laws. In general, a U.S. holder (as defined in the section entitled
“Material U.S. Federal Income Tax Consequences of the Merger” beginning on page 96 of this proxy statement)
whose shares of Corindus common stock are converted into the right to receive cash in the merger will recognize capital gain
or loss for U.S. federal income tax purposes in an amount equal to the difference, if any, between the amount of cash
received with respect to such shares and the U.S. holder’s adjusted tax basis in such shares.
You
should read the section entitled “Material U.S. Federal Income Tax Consequences of the Merger” beginning on page
96 of this proxy statement and consult your tax advisors regarding the U.S. federal income tax consequences of the merger to
you in your particular circumstances, as well as tax consequences arising under the laws of any state, local or foreign
taxing jurisdiction.
As promptly as
practicable following the completion of the merger, the Corindus common stock currently listed on the NYSE American will cease
to be listed on the NYSE American and will be deregistered under the Exchange Act.
If the merger is
completed, Corindus stockholders will be entitled to appraisal rights under Section 262 of the DGCL, provided that they comply
with the conditions and requirements established therein.
Under Section 262
of the DGCL, Corindus stockholders of record who do not wish to accept the common stock consideration in respect of their shares
of Corindus common stock or the preferred stock consideration in respect of their shares of Corindus preferred stock, respectively,
have the right to demand appraisal of their respective shares of Corindus capital stock and to receive payment in cash of the fair
value of their shares of Corindus capital stock as of the effective time of the merger, exclusive of any element of value arising
from the accomplishment or expectation of the merger, as determined by the Delaware Court of Chancery, together with interest,
if any, to be paid upon the amount determined to be such fair value (or, in certain circumstances described below, on the difference
between the amount determined to be the fair value and the amount paid to each stockholder entitled to appraisal prior to the entry
of judgment in the appraisal proceeding), provided that they comply with the conditions and requirements established in Section
262 of the DGCL. The “fair value” per share of your shares of Corindus capital stock as determined by the Delaware
Court of Chancery in an appraisal proceeding may be more or less than, or the same as, the applicable merger consideration that
you are otherwise entitled to receive under the terms of the merger agreement for each share of your Corindus capital stock. Corindus
stockholders who do not vote in favor of the merger proposal who properly demand appraisal for their shares Corindus capital stock
in compliance with the provisions of Section 262 of the DGCL, who do not withdraw such demand or otherwise waive or lose their
right to appraisal and who comply with the other requirements to exercise appraisal rights under the DGCL will be entitled to appraisal
rights under the DGCL. Strict compliance with the statutory procedures in Section 262 of the DGCL is required. Failure to follow
precisely any of the statutory requirements may result in the loss of your appraisal rights.
This section is
intended only as a brief summary of certain provisions of the Delaware statutory procedures that a stockholder must follow in order
to seek and perfect appraisal rights. This summary, however, is not a complete statement of all applicable requirements and the
law pertaining to appraisal rights under the DGCL, and is qualified in its entirety by reference to Section 262 of the DGCL, the
full text of which is attached to this proxy statement as Annex C, in its entirety. The following summary does not constitute
any legal or other advice, nor does it constitute a recommendation that stockholders exercise their appraisal rights under Section
262 of the DGCL.
Under Section 262
of the DGCL where a merger agreement is to be submitted for adoption at a meeting of stockholders, Corindus must notify the stockholders
who were stockholders of record on the record date for notice of such meeting with respect to shares for which appraisal rights
are available, not less than 20 days before the meeting to vote on the merger, that appraisal rights will be available. A copy
of Section 262 of the DGCL must be included with such notice. This proxy statement constitutes Corindus’ notice to our stockholders
that appraisal rights are available in connection with the merger and the full text of Section 262 of the DGCL is attached to this
proxy statement as Annex C, in compliance with the requirements of Section 262 of the DGCL. If you wish to consider exercising
your appraisal rights, you should carefully review the text of Section 262 of the DGCL contained in Annex C. Failure to
comply timely and properly with the requirements of Section 262 of the DGCL may result in the loss of your appraisal rights under
the DGCL. Moreover, because of the complexity of the procedures for exercising the right to seek appraisal of shares of Corindus
capital stock, Corindus believes that if a stockholder is considering exercising such rights, such stockholder should seek the
advice of legal counsel.
If you wish to
demand appraisal of your shares of Corindus capital stock, you must satisfy each of the following conditions:
If you fail to
comply with any of the requirements under Section 262 of the DGCL to perfect your appraisal rights and the merger is completed,
your respective shares of Corindus capital stock will be converted into the right to receive payment of the applicable merger
consideration for your shares of Corindus capital stock as provided for in the merger agreement and you will lose your appraisal
rights with respect to your shares of Corindus capital stock.
A holder of shares
of Corindus capital stock wishing to exercise appraisal rights must hold of record the shares of Corindus capital stock on the
date the written demand for appraisal is made and must continue to hold the shares of Corindus capital stock of record through
the effective time of the merger. A proxy that is submitted and does not contain voting instructions will, unless revoked, be voted
“FOR” the merger proposal, and it will result in the loss of the stockholder’s right of appraisal and will nullify
any previously delivered written demand for appraisal. Therefore, a stockholder who submits a proxy and who wishes to exercise
appraisal rights must either submit a proxy containing instructions to vote “AGAINST” the merger proposal or abstain
from voting on the merger proposal. Voting against or failing to vote for the merger proposal by itself does not constitute a demand
for appraisal within the meaning of Section 262 of the DGCL. The written demand for appraisal must be in addition to and separate
from any proxy or vote on the merger proposal.
All demands for
appraisal should be addressed to Corindus Vascular Robotics, Inc., Attention: Chief Financial Officer, 309 Waverley Oaks Road,
Suite 105, Waltham, Massachusetts 02452, and must be delivered to Corindus before the vote is taken to approve merger proposal
at the special meeting, and must be executed by, or on behalf of, the record holder of the shares of Corindus capital stock for
which appraisal is demanded. The demand must reasonably inform Corindus of the identity of the stockholder and the intention of
the stockholder to demand appraisal of his, her or its shares of Corindus capital stock in connection with the merger. A stockholder’s
failure to deliver to Corindus the written demand for appraisal prior to the taking of the vote on the merger proposal at the special
meeting of stockholders will result in the loss of appraisal rights.
Only a holder of
record of shares of Corindus capital stock is entitled to demand an appraisal of the shares registered in that holder’s name.
Accordingly, to be effective, a demand for appraisal by a stockholder of Corindus capital stock must be made by, or on behalf of,
the record stockholder. The demand should set forth, fully and correctly, the record stockholder’s name as it appears on
the stockholder’s stock certificate(s) or in the transfer agent’s records, in the case of uncertificated shares, should
specify the stockholder’s mailing address and the number of shares of Corindus capital stock registered in the stockholder’s
name. The demand must state that the person intends thereby to demand appraisal of the stockholder’s shares Corindus capital
stock in connection with the merger. The demand cannot be made by the beneficial owner if he or she does not also hold the shares
of Corindus capital stock of record. The beneficial holder must, in such cases, have the registered owner, such as a bank, brokerage
firm or other nominee, submit the required demand in respect of those shares of Corindus capital stock. If you hold your shares
of Corindus capital stock through a bank, brokerage firm or other nominee and you wish to exercise appraisal rights, you should
consult with your bank, brokerage firm or the other nominee to determine the appropriate procedures for the making of a demand
for appraisal by the nominee and obtaining notice of the effective date of the merger.
If shares of Corindus
capital stock are owned of record in a fiduciary capacity, such as by a trustee, guardian or custodian, execution of a demand for
appraisal must be made in that capacity. If the shares of Corindus capital stock are owned of record by more than one person, as
in a joint tenancy or tenancy in common, the demand must be executed by or for all joint owners. An authorized agent, including
an authorized agent for two or more joint owners, may execute the demand for appraisal for a stockholder of record; however, the
agent must identify the record owner or owners and expressly disclose the fact that, in executing the demand, he or she is acting
as agent for the record owner or owners. A record owner, such as a bank, brokerage firm or other nominee, who holds shares of Corindus
capital stock as a nominee for others, may exercise his, her or its right of appraisal with respect to the shares of Corindus capital
stock held for one or more beneficial owners, while not exercising this right for other beneficial owners. In that case, the written
demand should state the number of shares of Corindus capital stock as to which appraisal is sought. Where no number of shares of
Corindus capital stock is expressly mentioned, the demand will be presumed to cover all shares of Corindus capital stock held in
the name of the record owner. If a stockholder holds shares of Corindus capital stock through a broker who in turn holds the shares
through a central securities depository nominee such as Cede & Co., a demand for appraisal of such shares of Corindus capital
stock must be made by or on behalf of the depository nominee and must identify the depository nominee as record owner.
Within 10 days
after the effective time of the merger, the surviving corporation in the merger must give notice of the date that the merger became
effective to each of Corindus’ record stockholders who has demanded appraisal in accordance with Section 262 of the DGCL
and who did not vote in favor of the merger proposal. At any time within 60 days after the effective time of the merger, any stockholder
who has not commenced an appraisal proceeding or joined a proceeding as a named party may withdraw the stockholder’s demand
and accept the applicable merger consideration specified by the merger agreement for that stockholder’s shares of Corindus
capital stock by delivering to the surviving corporation a written withdrawal of the demand for appraisal. However, any such attempt
to withdraw the demand made more than 60 days after the effective time of the merger will require written approval of the surviving
corporation. No appraisal proceeding in the Delaware Court of Chancery will be dismissed as to any stockholder without the approval
of the Delaware Court of Chancery, with such approval conditioned upon such terms as the Delaware Court of Chancery deems just;
provided, however that any stockholder who has not commenced an appraisal proceeding or joined that proceeding as a named party
may withdraw such stockholder’s demand for appraisal and to accept the terms offered upon the merger within 60 days after
the effective date of the merger. If the surviving corporation does not approve a request to withdraw a demand for appraisal when
that approval is required, or, if the Delaware Court of Chancery does not approve the dismissal of an appraisal proceeding, the
stockholder will be entitled to receive only the appraised value of his, her or its shares of Corindus capital stock determined
in any such appraisal proceeding, plus interest, if any, which value could be less than, equal to or more than the applicable merger
consideration offered pursuant to the merger agreement.
Within 120 days
after the effective time of the merger, but not thereafter, either the surviving corporation or any stockholder who has complied
with the requirements of Section 262 of the DGCL and is entitled to appraisal rights under Section 262 of the DGCL may commence
an appraisal proceeding by filing a petition in the Delaware Court of Chancery demanding a determination of the fair value of the
respective shares of Corindus capital stock held by all such stockholders. Upon the filing of the petition by a stockholder, service
of a copy of such petition shall be made upon the surviving corporation. The surviving corporation has no obligation to file such
a petition, has no present intention to file a petition and holders should not assume that the surviving corporation will file
a petition. Accordingly, it is the obligation of the respective holders of Corindus capital stock to initiate all necessary petitions
to perfect their appraisal rights in respect of shares of Corindus capital stock within the time prescribed in Section 262 of the
DGCL and the failure of a stockholder to file such a petition within the period specified in Section 262 of the DGCL could nullify
the stockholder’s previous written demand for appraisal. In addition, within 120 days after the effective time of the merger,
any stockholder who has properly complied with the requirements of Section 262 of the DGCL and who did not vote in favor of the
merger proposal, will be entitled to receive from the surviving corporation, upon written request, a statement setting forth the
aggregate number of shares of Corindus capital stock not voted in favor of the merger proposal and with respect to which demands
for appraisal have been received and the aggregate number of holders of such shares of Corindus capital stock. The statement must
be mailed within 10 days after such written request has been received by the surviving corporation or within 10 days after the
expiration of the period for delivery of demands for appraisal, whichever is later. A person who is the beneficial owner of shares
of Corindus capital stock held either in a voting trust or by a nominee on behalf of such person for which appraisal has been properly
demanded may, in such person’s own name, file a petition for appraisal or request from the surviving corporation such statement.
If a petition for
appraisal is duly filed by a stockholder and a copy of the petition is delivered to the surviving corporation, then the surviving
corporation will be obligated, within 20 days after receiving service of a copy of the petition, to file with the Delaware Register
in Chancery a duly verified list containing the names and addresses of all stockholders who have demanded an appraisal of their
respective shares of Corindus capital stock and with whom agreements as to the value of their shares of Corindus capital stock
have not been reached. After notice to stockholders who have demanded appraisal from the Register in Chancery, if such notice is
ordered by the Delaware Court of Chancery, the Delaware Court of Chancery will conduct a hearing upon the petition and determine
those stockholders who have become entitled to the appraisal rights provided by Section 262 of the DGCL. The Delaware Court of
Chancery may require stockholders who have demanded appraisal of their shares of Corindus capital stock to submit their stock certificates
to the Register in Chancery for notation of the pendency of the appraisal proceedings; and if any stockholder fails to comply with
that direction, the Delaware Court of Chancery may dismiss the proceedings as to that stockholder.
After determination
of the stockholders entitled to appraisal of their respective shares of Corindus capital stock, the Delaware Court of Chancery
will appraise the shares of Corindus capital stock, determining their fair value as of the effective time of the merger after taking
into account all relevant factors exclusive of any element of value arising from the accomplishment or expectation of the merger,
together with interest, if any, to be paid upon the amount determined to be the fair value (or, in certain circumstances described
below, on the difference between the amount determined to be the fair value and the amount paid to each stockholder entitled to
appraisal prior to the entry of judgment in the appraisal proceeding). When the fair value has been determined, the Delaware Court
of Chancery will direct the payment of such value (with interest, if any), in the case of holders of uncertificated stock forthwith,
and in the case of holders of shares represented by certificates upon surrender by those stockholders of the certificates representing
their shares of Corindus capital stock. Unless the Delaware Court of Chancery in its discretion determines otherwise for good cause
shown, interest from the effective date of the merger through the date of payment of the judgment shall be compounded quarterly
and shall accrue at 5% over the Federal Reserve discount rate (including any surcharge) as established from time to time during
the period between the effective time of the merger and the date of payment of the judgment. At any time before the entry of judgment
in the proceedings, the surviving company may pay to each stockholder entitled to appraisal an amount in cash, in which case interest
shall accrue thereafter as described herein only upon the sum of (i) the difference, if any, between the amount so paid and the
fair value of the shares of Corindus capital stock as determined by the Delaware Court of Chancery, and (ii) interest theretofore
accrued, unless paid at that time.
You should be aware
that an investment banking opinion as to the fairness from a financial point of view of the consideration to be received in a sale
transaction, such as the merger, is not an opinion as to fair value under Section 262 of the DGCL. Although we believe that the
applicable per share merger consideration is fair, no representation is made as to the outcome of the appraisal of fair value as
determined by the Delaware Court of Chancery and stockholders should recognize that such an appraisal could result in a determination
of a value higher or lower than, or the same as, the applicable per share merger consideration. Moreover, we do not anticipate
offering more than the applicable per share merger consideration to any stockholder exercising appraisal rights and reserve the
right to assert, in any appraisal proceeding, that, for purposes of Section 262 of the DGCL, the “fair value” of a
share of Corindus capital stock is less than the applicable per share merger consideration. In determining “fair value,”
the Delaware Court of Chancery is required to take into account all relevant factors. Section 262 of the DGCL provides that fair
value is to be “exclusive of any element of value arising from the accomplishment or expectation of the merger.”
In determining
the “fair value” of the shares, a Delaware Court is required to take into account all relevant factors. In Weinberger
v. UOP, Inc., the Delaware Supreme Court discussed the factors that could be considered in determining fair value in an appraisal
proceeding, stating that “proof of value by any techniques or methods which are generally considered acceptable in the financial
community and otherwise admissible in court” should be considered and that “[f]air price obviously requires consideration
of all relevant factors involving the value of a company.” The Delaware Supreme Court has stated that, in making this determination
of fair value, the court must consider market value, asset value, dividends, earnings prospects, the nature of the enterprise and
any other factors that could be ascertained as of the date of the merger that throw any light on future prospects of the merged
corporation. Section 262 of the DGCL provides that fair value is to be “exclusive of any element of value arising from the
accomplishment or expectation of the merger.” In Cede & Co. v. Technicolor, Inc., the Delaware Supreme Court stated
that such exclusion is a “narrow exclusion [that] does not encompass known elements of value,” but which rather applies
only to the speculative elements of value arising from such accomplishment or expectation. In Weinberger, the Delaware Supreme
Court construed Section 262 of the DGCL to mean that “elements of future value, including the nature of the enterprise, which
are known or susceptible of proof as of the date of the merger and not the product of speculation, may be considered.”
Costs of the appraisal
proceeding (which do not include attorneys’ fees or the fees and expenses of experts) may be determined by the Delaware Court
of Chancery and imposed upon the surviving corporation and the stockholders participating in the appraisal proceeding by the Delaware
Court of Chancery, as it deems equitable in the circumstances. Upon the application of a stockholder, the Delaware Court of Chancery
may order all or a portion of the expenses incurred by any stockholder in connection with the appraisal proceeding, including,
without limitation, reasonable attorneys’ fees and the fees and expenses of experts used in the appraisal proceeding, to
be charged pro rata against the value of all shares of Corindus capital stock entitled to appraisal. Any stockholder who demanded
appraisal rights will not, after the effective time of the merger, be entitled to vote shares of Corindus capital stock subject
to that demand for any purpose or to receive payments of dividends or any other distribution with respect to those shares of Corindus
capital stock, other than with respect to payment as of a record date prior to the effective time of the merger. If no petition
for appraisal is filed within 120 days after the effective time of the merger, or if the stockholder otherwise fails to perfect,
successfully withdraws or loses such holder’s right to appraisal, then the right of that stockholder to appraisal will cease
and that stockholder’s shares of Corindus capital stock will be deemed to have been converted at the effective time of the
merger into the right to receive the applicable merger consideration (without interest) for his, her or its shares of Corindus
capital stock pursuant to the merger agreement.
The merger agreement
and this summary of its terms have been included to provide you with information regarding the terms of the merger agreement. Factual
disclosures about Corindus contained in this proxy statement or in Corindus’ public reports filed with the SEC may supplement,
update or modify the factual disclosures about Corindus contained in the merger agreement and described in this summary. The representations,
warranties and covenants made in the merger agreement by Corindus, SMS USA and Merger Sub were qualified and subject to important
limitations agreed to by Corindus, SMS USA and Merger Sub in connection with negotiating the terms of the merger agreement. In
particular, in your review of the representations and warranties contained in the merger agreement and described in this summary,
it is important to bear in mind that the representations and warranties were negotiated with the principal purposes of establishing
the circumstances in which a party to the merger agreement may have the right not to consummate the merger if the representations
and warranties of the other party prove to be untrue, due to a change in circumstance or otherwise, and allocating risk between
the parties to the merger agreement, and were not intended by the parties to the merger agreement to be a characterization of the
actual state of facts or condition of Corindus, SMS USA or Merger Sub, except as expressly stated in the merger agreement. The
representations and warranties may also be subject to a contractual standard of materiality different from those generally applicable
to stockholders and reports and documents filed with or furnished to the SEC, and in some cases were qualified by disclosures that
were made by each party to the other, which disclosures are not reflected in the merger agreement. Moreover, information concerning
the subject matter of the representations and warranties, which do not purport to be accurate as of the date of this proxy statement,
may have changed since the date of the merger agreement and subsequent developments or new information qualifying a representation
or warranty may have been included in this proxy statement or in the respective public filings made by each of Corindus or SMS
USA with the SEC.
Additional information
about Corindus may be found elsewhere in this proxy statement and Corindus’ other public filings. See the section entitled
“Where You Can Find More Information” beginning on page 100 of this proxy statement.
The closing of
the merger will take place at the offices of Blank Rome, 1271 Avenue of the Americas, New York, NY 10020, or by the electronic
transmission of signature pages, at 10:00 a.m. (local time) on a date to be specified by the parties, but no later than the second
business day after the satisfaction or (to the extent permitted by law) waiver of the conditions set forth in the merger agreement
(other than those conditions that by their terms are to be satisfied at the closing, but subject to the satisfaction or (to the
extent permitted by law) waiver of such conditions), unless another time, date or place is agreed to in writing by Corindus, Merger
Sub and SMS USA.
Concurrently with
the closing, Corindus will cause to be filed an appropriate, executed certificate of merger with respect to the merger with the
Delaware Secretary of State as provided under the DGCL. The merger will become effective upon the filing of such certificate of
merger, or at such later date and time as is agreed by SMS USA and Corindus and specified in such certificate of merger.
Upon the terms
and conditions of the merger agreement, at the effective time, Merger Sub will merge with and into Corindus and the separate corporate
existence of Merger Sub will cease, with Corindus continuing as the surviving corporation and a wholly owned subsidiary of SMS
USA. At the effective time, the certificate of incorporation of Corindus will, by virtue of the merger, be amended and restated
in its entirety as set forth in Exhibit B to the merger agreement and the amended and restated certificate of incorporation will
be the certificate of incorporation of the surviving corporation until thereafter amended. At the effective time, the bylaws of
Merger Sub, as in effect immediately before the effective time, will by virtue of the merger, be amended and restated in its entirety
as set forth in Exhibit C to the merger agreement and such amended and restated bylaws will be the bylaws of the surviving corporation
until thereafter amended. From and after the effective time, the directors of Merger Sub immediately before the effective time
will be the initial directors of the surviving corporation, and the officers of the surviving corporation will be designated by
SMS USA immediately prior to the effective time, and, in each case, will hold office until their respective successors are duly
elected, designated or qualified, or until their earlier death, resignation or removal, in accordance with the surviving corporation’s
certificate of incorporation and bylaws.
At the effective
time, each share of (i) Corindus common stock issued and outstanding immediately prior to the effective time (other than canceled
shares and dissenting shares) will be converted into the right to receive the common stock consideration, without interest and
(ii) (A) Series A preferred stock issued and outstanding immediately prior to the effective time and (B) Series A-1 preferred stock
issued and outstanding prior to the effective time and Series A-1 preferred stock that has accrued and accumulated on a daily basis
until the effective time, in accordance with the provisions of the certificate of designation, but which is not otherwise issued
or outstanding immediately prior to the effective time, in each case other than canceled shares and dissenting shares, shall be
converted into the right to receive an amount in cash equal to the preferred stock consideration, without interest.
Each share of
Corindus capital stock converted into the right to receive the applicable merger
consideration, as described above, will no longer be outstanding and will be automatically canceled and will cease to exist,
and each holder of certificates or book-entry shares, which immediately prior to the effective time represented such Corindus
capital stock, will cease to have any rights with respect thereto, except the right to receive, upon surrender of such
certificates or book-entry shares, the applicable merger consideration.
The applicable
merger consideration will be adjusted appropriately to reflect the effect of any reclassification, recapitalization, exchange,
stock split (including reverse stock split) or combination or readjustment of shares or any similar event or any stock dividend
or stock distribution with a record date occurring on or after the date of the merger agreement and prior to the effective time,
in order to provide the same economic effect as contemplated by the merger agreement prior to such event.
Prior to or
at the effective time, SMS USA will deposit, or cause to be deposited, with a paying agent (which shall be a nationally
recognized financial institution) designated by SMS USA that is reasonably acceptable to Corindus, cash in immediately
available funds in an amount sufficient to pay the Aggregate Merger Consideration and the consideration in respect of the
cancelled Corindus warrants.
As promptly as
reasonably practicable after the effective time (and in any event within five business days after the effective time), SMS USA
will cause the paying agent to mail to each holder of record of certificates that immediately prior to the effective time represented
outstanding shares of Corindus capital stock (i) a letter of transmittal, which will specify that delivery of certificates will
be effected, and risk of loss and title to the certificates will pass only upon proper delivery of the certificates (or affidavits
of loss in lieu thereof) to the paying agent and will be in a form and have such other customary provisions as reasonably specified
by SMS USA, and (ii) instructions for effecting the surrender of the certificates in exchange for cash in an amount equal to the
applicable merger consideration multiplied by the number of shares of Corindus capital stock previously represented by such certificates.
Upon surrender
of a certificate (or an affidavit of loss in lieu thereof) for cancellation to the paying agent, together with such letter of transmittal
duly completed and validly executed in accordance with the instructions thereto, and such other documents as may be reasonably
required by the paying agent, the holder of such certificate will be entitled to receive in exchange therefor as promptly as reasonably
practicable cash in an amount equal to the applicable merger consideration multiplied by the number of shares of Corindus capital
stock previously represented by such certificate and the certificate (or affidavit of loss in lieu thereof) so surrendered will
be cancelled. Each book-entry share representing shares of Corindus capital stock will automatically upon the effective time be
entitled to receive, and SMS USA will cause the paying agent to pay and deliver in exchange therefor as promptly as reasonably
practicable after the effective time, cash in an amount equal to the applicable merger consideration multiplied by the number of
shares of Corindus capital stock previously represented by such book-entry share. The paying agent will accept such certificates
(or affidavits of loss in lieu thereof) and make such payments and deliveries with respect to book-entry shares upon compliance
with such reasonable terms and conditions as the paying agent may impose to effect an orderly exchange thereof in accordance with
customary exchange practices. No interest will be paid or accrued for the benefit of holders of the certificates or book-entry
shares on the cash amounts payable upon the surrender or delivery thereof.
The merger agreement
contains representations and warranties of each of Corindus, SMS USA and Merger Sub, subject to certain qualifications or exceptions
in the merger agreement and the disclosure letter delivered in connection with the merger agreement, as to, among other things:
The merger agreement
also contains representations and warranties of Corindus, subject to certain qualifications or exceptions in the merger agreement
and the disclosure letter delivered in connection with the merger agreement, as to, among other things:
The merger agreement
also contains representations and warranties of SMS USA and Merger Sub, subject to certain qualifications or exceptions in the
merger agreement as to, among other things:
Some of the representations
and warranties in the merger agreement are qualified by materiality qualifications or a “Company Material Adverse Effect”
or “Parent Material Adverse Effect” clause.
For purposes of
the merger agreement, a “Company Material Adverse Effect” means any effect, change, development, event, circumstance,
occurrence, condition, fact or state of facts that has a material adverse effect, individually or in the aggregate:
provided, further, however, that in
the cases of the first, second, fifth and sixth sub-bullets above, to the extent Corindus and its subsidiaries, taken as a whole, are disproportionately
affected thereby in relation to other companies in the medical device industry, such effects, changes, developments, events, circumstances,
occurrences, conditions, facts or states of facts may be taken into account in determining whether a Company Material Adverse Effect
has occurred to the extent of such disproportionate impact; or
For purposes of
the merger agreement, a “Parent Material Adverse Effect” means the impairment in any material respect of the ability
of SMS USA or Merger Sub, as the case may be, to perform its obligations under the merger agreement or to consummate the merger
and pay the Aggregate Merger Consideration and other amounts required to be paid by SMS USA and Merger Sub under the merger agreement,
or otherwise prevent, materially delay or materially impair the consummation of the merger and the other transactions contemplated
by the merger agreement.
The merger agreement
provides that, subject to certain exceptions in the disclosure letter delivered by Corindus in connection with the merger agreement,
and except as may be expressly required by the merger agreement, required by law or as consented to by SMS USA in writing (such
consent not to be unreasonably withheld, conditioned or delayed), as required by the terms of certain material contracts of Corindus
in effect as of the date of the merger agreement, during the period from the date of the merger agreement to the effective time
(or the date, if any, on which the merger agreement is terminated by its terms), (i) Corindus will, and will cause each of its
subsidiaries to conduct its business, in all material respects in the ordinary course of business and in a manner consistent with
past practice and, to the extent consistent therewith, use commercially reasonable efforts to preserve its assets and business
organization intact in all material respects and maintain its existing business relations and goodwill with customers, suppliers,
licensors, distributors, governmental authorities, employees and business partners, in each case whose business relationships are
material to Corindus and its subsidiaries, taken as a whole, and (ii) Corindus will not, and will cause each of its subsidiaries
not to, directly or indirectly:
Notwithstanding
the above, nothing contained in the merger agreement gives SMS USA or Merger Sub or any of their respective affiliates the right
to control or direct Corindus’ or its subsidiaries’ operations prior to the effective time.
Subject to certain
exceptions and limitations, from August 7, 2019 until the earlier of the effective time and the date, if any, on which the merger
agreement is terminated, Corindus will, and will cause its subsidiaries to, afford SMS USA and Merger Sub and their respective
representatives reasonable access, to be coordinated through Corindus or its designated representatives in accordance with such
reasonable procedures as they may establish, during normal business hours and upon reasonable notice, to the officers, employees,
agents, properties, books, contracts and records of Corindus and its subsidiaries. In addition, during such same period and subject
to certain exceptions and limitations, Corindus will, and will cause its subsidiaries to, reasonably promptly furnish all other
information concerning the business, properties and personnel of Corindus and its subsidiaries as SMS USA or Merger Sub may reasonably
request.
From and after
the date of the merger agreement until the earlier of the effective time or the date, if any, on which the merger agreement is
terminated by its terms, except as expressly permitted in connection with a Company Acquisition Proposal or Company Superior Proposal,
Corindus may not (and will not permit its subsidiaries and its and their respective affiliates and representatives to): (i) initiate,
seek, solicit, facilitate or knowingly encourage, or knowingly induce the making, submission or announcement of, any Company Acquisition
Proposal, (ii) enter into, continue or otherwise participate in any negotiations or discussions with, or furnish or cause to be
furnished any non-public information or data to, or furnish access to Corindus’ (or any of its subsidiaries’) properties
with respect to, any third party (other than SMS USA or any of its affiliates or representatives) relating to any Company Acquisition
Proposal or any inquiry, proposal or offer that would reasonably be expected to lead to any Company Acquisition Proposal (other
than informing any persons of the non-solicitation provisions in the merger agreement), or grant any waiver or release under (or
terminate, amend or modify any provision of) any confidentiality agreement to which Corindus is a party except to the extent to
allow an applicable party to make a Company Acquisition Proposal, (iii) execute or enter into any binding or non-binding letter
of intent, agreement in principle, memorandum of understanding, merger agreement, acquisition agreement, option agreement, joint
venture agreement, partnership agreement or other agreement, commitment, arrangement or understanding relating to or in connection
with, or that is intended to lead to, any Company Acquisition Proposal (each, an “Alternative Acquisition Agreement”),
(iv) submit any Company Acquisition Proposal or Company Superior Proposal to the Corindus stockholders for their approval, or (v)
resolve to do, or agree or publicly announce an intention to do, any of the foregoing.
Notwithstanding
the restrictions described in the foregoing paragraph, if Corindus or any of its subsidiaries receive, at any time following August
7, 2019, and prior to obtaining the Company Stockholder Approval, a bona fide written Company Acquisition Proposal from a third
party that did not result from a breach of the non-solicitation and related provisions of the merger agreement then Corindus may
contact such third party to clarify the terms and conditions of such Company Acquisition Proposal and, further, if the Board (or
a duly authorized committee thereof) determines in good faith, after consultation with Corindus’ financial advisors and outside
legal counsel, that (i) such Company Acquisition Proposal constitutes or could reasonably be expected to lead to or result in a
Company Superior Proposal and (ii) the failure to take the action described in the immediately following clause (x) or (y) would
be reasonably be expected to be inconsistent with the Board’s fiduciary duties under applicable law, then Corindus may (x)
furnish information concerning its business, properties or assets to the third party making such Company Acquisition Proposal pursuant
to a customary confidentiality agreement that (1) does not contain any provision prohibiting or otherwise restricting Corindus’
ability to comply with any of the terms of the merger agreement and (2) contains provisions that are no less favorable in the aggregate
to Corindus, or less restrictive to the party making such Company Acquisition Proposal in the aggregate (in comparison to SMS USA),
than those contained in the confidentiality agreement between Corindus and SMS USA (provided, however, that such agreement need
not contain any standstill agreement or similar obligation) and (y) negotiate and participate in discussions and negotiations with
such third party concerning the Company Acquisition Proposal.
Corindus will provide
SMS USA (i) prompt notice (and in any event within 48 hours) of the receipt of any Company Acquisition Proposal (including, if
applicable, a complete, unredacted copy of such Company Acquisition Proposal), (ii) prompt notice (and in any event within 48 hours)
of any inquiries, proposals or offers received by Corindus, or any of its subsidiaries or any of its or their respective representatives
concerning a Company Acquisition Proposal, or proposal that is reasonably likely to constitute or lead to or result in a Company
Acquisition Proposal, and disclose the identity of the other party (or parties) and, if applicable, the material terms (including
any amendments thereto) of such inquiry, offer or proposal, and (iii) promptly (and in any event within 48 hours) all information,
including copies of all written materials, provided by Corindus or any of its subsidiaries or its or their respective representatives
to such third party but not previously provided to SMS USA. Corindus will keep SMS USA reasonably informed on a reasonably prompt
basis (and, in any case, within 48 hours) of any significant development, discussions or negotiations (including amendments and
proposed amendments) relating to any such Company Acquisition Proposal or any material change to the financial or other material
terms of any such Company Acquisition Proposal or such other inquiry, offer or proposal (including by providing copies of all required
proposals related thereto that have not already been provided pursuant to the provisions of the merger agreement described in clauses
(i) and (ii) above).
Except as expressly
permitted by the merger agreement in respect of a Company Superior Proposal or an Company Intervening Event, neither the Board
nor any committee thereof shall (i) withdraw, qualify or modify in a manner adverse to SMS USA, or publicly propose to withdraw,
qualify or modify in a manner adverse to SMS USA, the Company Recommendation (as defined below), (ii) approve, authorize, declare
advisable, endorse or recommend (or publicly propose to approve, authorize, declare advisable, endorse or recommend) any Company
Acquisition Proposal, (iii) fail to include in this proxy statement the Company Recommendation, (iv) fail to recommend against
any Company Acquisition Proposal that is a tender or exchange offer subject to Regulation 14D under the Exchange Act in a Solicitation/Recommendation
Statement on Schedule 14D-9 within ten business days after the commencement (within the meaning of Rule 14d-2 under the Exchange
Act) of such tender or exchange offer (any action described in clauses (i) through (iv) of this sentence being referred to as a
“Company Adverse Recommendation Change”), or (v) adopt or approve, or propose to adopt or approve, or allow Corindus
or any of its subsidiaries to execute or enter into, any Alternative Acquisition Agreement.
Notwithstanding
anything in the merger agreement to the contrary, if at any time prior to receipt of the Company Stockholder Approval, Corindus
or the Board receives a Company Superior Proposal, the Board may authorize and cause Corindus to effect a Company Adverse Recommendation
Change and/or terminate the merger agreement while concurrently entering into a definitive agreement providing for such Company
Superior Proposal (subject to satisfaction of Corindus’ termination fee obligations described below), if (i) the Board determines
in good faith, after consultation with Corindus’ outside legal counsel, that the failure to take such action would reasonably
be expected to be inconsistent with the Board’s fiduciary duties under applicable law, (ii) Corindus has notified SMS USA
in writing that it intends to take such action, (iii) Corindus has provided SMS USA a copy of the proposed definitive agreements
(and any related agreements) relating to such Company Superior Proposal (and has informed SMS USA of the identity of the third
party making such Company Superior Proposal), and (iv) if prior to 11:59 p.m., New York City time, on the second business day following
the notice delivered pursuant to clause (ii) of this sentence, Corindus and its representatives shall have received a written proposal
made by SMS USA to amend the merger agreement or enter into an alternative transaction with Corindus, the Board shall have determined
in good faith (after consultation with Corindus’ financial advisor and outside legal counsel), after considering and taking
into account the terms of any proposed amendment or modification to the merger agreement or a possible alternative transaction
made by SMS USA in writing solely during such period, that (1) the Company Acquisition Proposal that is the subject of the notice
described in clause (ii) of this sentence still constitutes a Company Superior Proposal and (2) the failure to take such action
would reasonably be expected to be inconsistent with the Board’s fiduciary duties under applicable law.
Notwithstanding
anything in the merger agreement to the contrary, other than in connection with a Company Superior Proposal (which is addressed
above), prior to obtaining the Company Stockholder Approval, the Board may, in response to a Company Intervening Event (as defined
below), effect a Company Adverse Recommendation Change if (i) the Board determines in good faith, after consultation with Corindus’
outside legal counsel, that the failure to take such action would reasonably be expected to be inconsistent with the Board’s
fiduciary duties under applicable law; and (ii) Corindus has notified SMS USA in writing that it intends to effect such a Company
Adverse Recommendation Change (which notice shall reasonably specify the facts and circumstances providing the basis of the Company
Intervening Event and for the Board’s determination to effect the Company Adverse Recommendation Change).
The merger agreement
provides that nothing therein will prohibit Corindus or the Board from (i) taking and disclosing to Corindus stockholders a position
contemplated by Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act, or from issuing a “stop, look and listen”
statement pending disclosure of its position thereunder or (ii) making any disclosure to its stockholders if the Board has determined
in good faith, after consultation with Corindus’ outside legal counsel, that the failure to do so would reasonably be expected
to be inconsistent with the Board’s fiduciary duties under applicable law; provided, however, that (1) in no event will the
foregoing clause permit Corindus or the Board to make a Company Adverse Recommendation Change except as otherwise permitted as
described above in respect of a Company Superior Proposal or Company Intervening Event, (2) in no event shall this provision affect,
modify or supplement the definition of Company Adverse Recommendation Change (or to the consequences thereof in accordance with
the merger agreement), and (3) any such disclosure (other than issuance by Corindus of a “stop, look and listen” communication
of the type contemplated by Rule 14d-9(f) under the Exchange Act) that addresses or relates to the approval, recommendation or
declaration of advisability by the Board with respect to the merger agreement or a Company Acquisition Proposal shall be deemed
to be a Company Adverse Recommendation Change unless the Board in connection with such communication publicly states that its recommendation
with respect to the merger agreement has not changed or refers to the prior recommendation of the Board, without disclosing any
Company Adverse Recommendation Change; provided, further that any factually accurate public statement that describes Corindus’
receipt of a Company Acquisition Proposal and the operation of the merger agreement with respect thereto shall not be deemed to
be a Company Adverse Recommendation Change.
Subject to the
Board not having effected a Company Adverse Recommendation Change or earlier termination of the merger agreement, Corindus (i)
is required to duly call, give notice of, convene and hold, as promptly as practicable after the SEC clearance of this proxy statement,
a special meeting of the Corindus stockholders, in accordance with applicable law, its constituent documents and the rules of the
NYSE American, for the purpose of considering and voting on the adoption of the merger agreement, the merger and other transactions
contemplated by the merger agreement and shall submit such proposal to such holders at the special meeting, (ii) except for a proposal
to adjourn the special meeting, if there are insufficient affirmative votes represented at the special meeting to obtain the Company
Stockholder Approval, will not submit any other proposal to such stockholders without SMS USA’s prior written consent (which
consent shall not be unreasonably conditioned, withheld or delayed), and (iii) may not adjourn or otherwise postpone or delay the
special meeting without SMS USA’s prior written consent; however, Corindus may adjourn or postpone the special meeting without
SMS USA’s prior written consent (A) to the extent necessary to ensure that any required supplement or amendment to this proxy
statement is provided to the Corindus stockholders, provided, that Corindus has reasonably consulted with SMS USA prior to such
adjournment or postponement, (B) if as of the time for which the special meeting is originally scheduled (as set forth in this
proxy statement) there are insufficient shares of Corindus common stock and Corindus preferred stock represented (either in person
or by proxy) to constitute a quorum necessary to conduct the business of the special meeting, or (C) in order to solicit additional
proxies if necessary to obtain the Company Stockholder Approval. Subject to the Board not having effected a Company Adverse Recommendation
Change, Corindus will, through the Board, make the Company Recommendation, include the Company Recommendation in this proxy statement
and use its reasonable efforts to solicit from its stockholders proxies in favor of the adoption of the merger agreement.
For a period of
no less than 12 months following the effective time, SMS USA or the surviving corporation (or one of their affiliates) will provide
to each continuing employee:
If the closing
occurs prior to December 31, 2019 or after December 31, 2019 but before the payment of bonuses for the 2019 fiscal year, SMS USA
or its subsidiaries will pay an annual bonus for 2019 to each eligible employee of Corindus based on actual performance levels
as of August 7, 2019, extrapolated through December 31, 2019, which payment will be made at the same time as such bonuses would
ordinarily be paid to eligible employees by Corindus pursuant to the terms of its bonus plans. If the closing occurs during the
2020 fiscal year, SMS USA or its subsidiaries will pay a pro-rated annual bonus under the applicable Corindus bonus plans in respect
of the portion of the 2020 fiscal year that occurs prior to the closing date to each eligible employee of Corindus based on target
level performance through the closing date, which payment will be made within 30 days following the closing date.
As of the effective
time and thereafter, SMS USA will provide (or will cause the surviving corporation to provide) that periods of employment with
Corindus or any of its subsidiaries prior to the merger will be taken into account for purposes of determining the eligibility
for participation and vesting and benefit accrual of any continuing employee under employee benefit plans, programs and policies
maintained by SMS USA, the surviving corporation or their affiliates in which such continuing employees become participants (excluding
any defined benefit pension plan or employer subsidized retiree medical benefits).
With respect to
each health or welfare benefit plan maintained by SMS USA, the surviving corporation or any of their respective affiliates for
the benefit of continuing employees (including any medical, dental, pharmaceutical or vision benefit plans), SMS USA will (i) cause
to be waived any eligibility waiting periods, any evidence of insurability requirements or required physical examinations, actively-at-work
requirements and the application of any pre-existing condition limitations under such plan to the extent such were waived or satisfied
under the comparable health or welfare benefit plan of Corindus or any of its subsidiaries immediately prior to the effective time;
and (ii) cause each continuing employee to be given credit under such plan for all amounts paid (or otherwise deemed paid) by such
continuing employee under any similar benefit plan for the plan year that includes the effective time for purposes of applying
deductibles, co-payments and out-of-pocket maximums as though such amounts had been paid in accordance with the terms and conditions
of the plans maintained by SMS USA, the surviving corporation or any of their respective affiliates, as applicable, for the plan
year in which the effective time occurs.
If requested in
writing by SMS USA, Corindus will terminate, effective as of immediately prior to the closing, any and all benefit plans intended
to include a 401(k) arrangement. SMS USA shall, or shall cause one of its subsidiaries or affiliates to, cause a 401(k) arrangement
sponsored by SMS USA (or such subsidiary or affiliate) to permit each continuing employee participating in a terminated 401(k)
arrangement to elect to rollover his or her account balances in such terminated 401(k) arrangement into the applicable SMS USA
(or its subsidiary’s or affiliate’s) plan.
Corindus, SMS USA
and Merger Sub will each use its reasonable best efforts to consummate and make effective the transactions contemplated by the
merger agreement and to cause the conditions to the merger to be satisfied, including using reasonable best efforts to accomplish
the following: (i) the obtaining of all necessary actions or non-actions, consents and approvals from governmental authorities
or other third parties necessary in connection with the consummation of the transactions contemplated by the merger agreement,
including the merger, and (ii) the making of all necessary registrations and filings and the taking of all reasonable steps as
may be necessary to obtain approval from, or to avoid a proceeding by, any governmental authority or other persons necessary in
connection with the consummation of the transactions contemplated by the merger agreement, including the merger.
Corindus, SMS USA
and Merger Sub will each as promptly as reasonably practicable after August 7, 2019, upon a date to be mutually agreed upon by
them, make its respective filings under the HSR Act.
Corindus, SMS USA
and Merger Sub will each furnish to the other such necessary information and reasonable assistance as the other may reasonably
request in connection with the preparation of any required governmental filings or submissions and will cooperate in responding
to any investigation or other inquiry from a governmental authority or in connection with any proceeding initiated by a private
party, in each case, under any applicable antitrust laws, including (i) promptly informing the other party of such inquiry or proceeding;
(ii) consulting in advance before making any presentations or submissions to a governmental authority, or in connection with any
such proceeding, to any other party, and supplying each other with copies of all material correspondence, filings or communications
between either party and any governmental authority, or in connection with any such proceeding, between either party and any other
party with respect to the merger agreement; and (iii) providing the other party with a reasonable advance opportunity to review
and comment upon and consider in good faith the views of the other party in connection with all written communications between
either party and any governmental authority, or in connection with any such proceeding. In addition, Corindus, SMS USA and Merger
Sub will each give reasonable notice to and consult with the other party in advance of any meeting or substantive telephone call
or conference with any governmental authority, or in connection with any such proceeding, with any other party, and to the extent
permitted by the governmental authority, give the other party the opportunity to attend and participate in such meeting, telephone
call or conference.
Notwithstanding
anything in the merger agreement to the contrary, none of SMS USA or any of its affiliates will be required to enter into one or
more agreements prior to the closing of the merger with respect to any transaction to divest, hold separate or otherwise take any
action that limits SMS USA’s or any of its affiliates’ (including, following the closing, Corindus’ or any of
its subsidiaries’) freedom of action, ownership or control with respect to, or their ability to retain or hold, directly
or indirectly, any of their respective businesses, assets, equity interests, product lines or properties (referred to as a “Divestiture
Action”); or take any Divestiture Action or otherwise agree to or proffer to sell, divest, hold separate, lease, license,
transfer, dispose of or otherwise encumber or impair or take any other action with respect to SMS USA’s or any of its affiliates’
ability to own or operate any assets, properties, businesses or product lines of SMS USA or any of its affiliates (including, following
the closing, any assets, properties, businesses or product lines of Corindus or its subsidiaries) and none of SMS USA or any of
its affiliates will be required to take any such action in connection with any action or proceeding by a third party other than
a governmental authority and Corindus will not, and will not permit any of its subsidiaries to, unless requested by SMS USA, commit
to or effect any action contemplated by this paragraph.
The merger agreement
contains additional agreements among Corindus, SMS USA and Merger Sub relating to, among other matters:
The obligations
of each of Corindus, SMS USA and Merger Sub to consummate the merger and the other transactions contemplated by the merger agreement
are subject to the satisfaction or (to the extent permitted by law) waiver by Corindus and SMS USA at or prior to the effective
time of the following conditions:
The respective
obligations of SMS USA and Merger Sub to effect the merger and the other transactions contemplated by the merger agreement are
also subject to the satisfaction or (to the extent permitted by law) waiver by SMS USA at or prior to the effective time of the
following conditions:
The obligations
of Corindus to effect the merger and the other transactions contemplated by the merger agreement are also subject to the satisfaction
or (to the extent permitted by law) waiver by Corindus at or prior to the effective time of the following conditions:
The merger agreement
may be terminated at any time before the effective time, whether before or after the Company Stockholder Approval is obtained (except
as otherwise expressly noted), as follows:
Corindus must pay
to SMS USA a termination fee of $32.515 million in the event that:
If we fail to pay
SMS USA the termination fee within the specified time period and, in order to obtain such payment, SMS USA commences a suit that
results in a judgment against Corindus for the payment, we will be required to reimburse SMS USA’s costs and expenses incurred
in connection with such suit, including interest. We are not required to pay the termination fee on more than one occasion. Following
receipt by SMS USA of the termination fee as a result of a termination of the merger agreement by SMS USA, we shall have no further
liability with respect to the merger agreement or the transactions contemplated thereby to SMS USA or Merger Sub.
Except as provided
under the termination fee provisions of the merger agreement summarized immediately above, whether or not the merger is consummated,
all expenses incurred in connection with the merger agreement and the transactions contemplated by the merger agreement will be
paid by the party incurring such expenses.
The parties to
the merger agreement are entitled (in addition to any other remedy to which they may be entitled in law or equity) to an injunction,
specific performance or other equitable relief to prevent breaches or threatened breaches of the merger agreement and to enforce
specifically the terms and provisions of the merger agreement.
The merger agreement
may be amended by mutual agreement of the parties thereto in writing at any time before the closing date, whether before or after
receipt of the Company Stockholder Approval, except that no amendment may be made after receipt of the Company Stockholder Approval
if such amendment would require, pursuant to applicable law or the applicable rules of any applicable stock exchange, further approval
of the Corindus stockholders, without such further approval of the Corindus stockholders having been obtained.
At any time before
the effective time, subject to applicable law, any party to the merger agreement may (i) extend the time for the performance of
any of the obligations or other acts of any other party thereto; (ii) waive any inaccuracies in the representations and warranties
of the other party contained in the merger agreement or in any document delivered pursuant thereto; and (iii) waive compliance
by any other party to the merger agreement with any of the agreements or conditions of such party contained therein.
The merger agreement
and all legal, administrative and other similar proceedings or actions (whether based on contract, tort or otherwise) arising out
of or relating to the merger agreement or the actions of the parties to the merger agreement in the negotiation, administration,
performance and enforcement of the merger agreement, will be governed by, and construed in accordance with, the laws of the State
of Delaware, without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware or any
other jurisdiction) that would cause the application of the laws of any jurisdiction other than the State of Delaware.
Each of the parties
to the merger agreement, with respect to any legal claim or proceeding arising out of the merger agreement or the transactions
contemplated thereby, among other things, expressly and irrevocably agrees to submit to the exclusive jurisdiction of the Delaware
Court of Chancery and any appellate court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines
to accept jurisdiction over a particular matter, any state or federal court within the State of Delaware).
In connection with
the execution of the merger agreement, on August 7, 2019, Healthineers delivered the letter of support which was accepted by Corindus,
pursuant to which, Healthineers has agreed, guaranteed and committed to the complete payment and discharge of all monetary obligations
and liabilities of SMS USA to Corindus in accordance with, and arising from, the merger agreement (other than the indemnification
obligations of SMS USA owed to directors and officers of Corindus pursuant to the merger agreement). If SMS USA defaults in the
due and punctual payment of such obligations under the merger agreement, Corindus shall be entitled to seek satisfaction and payment
of such obligations directly against Healthineers up to the Aggregate Merger Consideration after Corindus has first made written
demand for satisfaction and payment of the relevant obligations to SMS USA and the expiry of a grace period of 30 days. The letter
of support is governed by the laws of Germany (to the exclusion of its conflict of laws rules), and its terms shall be construed
according to the laws of Germany. All disputes, claims, controversies and disagreements relating to or arising in connection with
the letter of support, or its subject matter shall be subject to the exclusive jurisdiction of the courts of Germany.
Corindus stockholders
are being asked to approve a proposal to adopt the merger agreement and approve the transactions contemplated thereby, including
the merger, which we refer to as the “merger proposal.” For a detailed discussion of the terms and conditions of the
merger agreement, see the sections entitled “The Merger Agreement” beginning on page 69 of this proxy statement
and “The Merger” beginning on page 31 of this proxy statement. A copy of the merger agreement is attached to
this proxy statement as Annex A.
The Board (other
than Mr. Harrington, who abstained from the Board vote on the merger) has determined that it is in the best interest of Corindus
and the Corindus stockholders that Corindus enter into the merger agreement and has approved and declared advisable the merger
agreement and the merger.
FUTURE
CORINDUS STOCKHOLDER PROPOSALS
Corindus has not
determined whether it will hold its 2020 annual meeting of stockholders due to the merger proposal. If the merger is consummated,
we will have no public stockholders and there will be no public participation in any future meetings of our stockholders. If the
merger is not completed, Corindus stockholders will continue to be entitled to attend and participate in Corindus’ annual
meeting of stockholders. If Corindus holds its 2020 annual meeting of stockholders, to
be considered for inclusion in our proxy statement relating to our 2020 annual meeting, we must receive
stockholder proposals by December 3, 2019. To be considered for presentation at the 2020 annual meeting, although not necessarily
included in our proxy statement, proposals (including director nominations that are not requested to be included in our proxy statement)
must be received no earlier than January 4, 2020 and no later than February 3, 2020. However, if the date of the annual meeting
is more than 30 days earlier or more than 30 days later than such anniversary date of our 2019 annual meeting, notice must be received
no earlier than 120 days and not later than the close of business on the later of (i) 90 days prior such annual meeting or (ii)
ten calendar days following the date on which public disclosure of the date of the meeting is first made. These proposals must
comply with the requirements as to form and substance established by the SEC for such proposals in order to be included in our
proxy statement. Proposals that are not received in a timely manner will not be voted on at the 2020 annual meeting. If a proposal
is received on time, the proxies that management solicits for the meeting may still exercise discretionary voting authority on
the proposal under circumstances consistent with the proxy rules of the SEC. Stockholders are advised to review our certificate
of incorporation and bylaws, which also specify requirements as to the form and content of a stockholder’s notice. All stockholder
proposals should be marked for the attention of Corporate Secretary, Corindus Vascular Robotics, Inc., 309 Waverley Oaks Rd., Suite
105, Waltham, Massachusetts, 02452.
MULTIPLE
CORINDUS STOCKHOLDERS SHARING ONE ADDRESS
The SEC has adopted
rules that permit companies and intermediaries, such as brokers and banks, to satisfy the delivery requirements for proxy statements
with respect to two or more stockholders sharing an address by delivering a single proxy statement, as applicable, addressed to
those stockholders, unless contrary instructions have been received. This procedure, which is commonly referred to as “householding,”
reduces the amount of duplicate information that stockholders receive and lowers printing and mailing costs for companies.
Certain brokerage
firms may have instituted householding for beneficial owners of Corindus capital stock held through brokerage firms. If your family
has multiple accounts holding Corindus capital stock, you may have already received a householding notification from your broker.
You may decide at any time to revoke your decision to household, and thereby receive multiple copies of proxy materials. If you
wish to opt out of this procedure and receive a separate set of proxy materials in the future, or if you are receiving multiple
copies and would like to receive only one, you should contact your broker, trustee or other nominee or Corindus at the address
and telephone number below. A separate copy of these proxy materials will be promptly delivered to any stockholder upon written
request to Corporate Secretary, Corindus Vascular Robotics, Inc., 309 Waverley Oaks Road, Suite 105, Waltham, MA 02452.
WHERE
YOU CAN FIND MORE INFORMATION
Investors will
be able to obtain free of charge this proxy statement and other documents filed with the SEC at the SEC’s website at http://www.sec.gov.
In addition, this proxy statement and our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form
8-K and amendments to those reports filed or furnished pursuant to section 13(a) or 15(d) of the Securities Exchange Act of 1934
are available free of charge through our website at www.corindus.com as soon as reasonably practicable after they are electronically
filed with, or furnished to, the SEC. The information located on, or hyperlinked or otherwise connected to, Corindus’ website
referenced anywhere in this proxy statement is not, and shall not be deemed to be, a part of this proxy statement or incorporated
into any other filings that we make with the SEC.
The SEC allows
us to “incorporate by reference” documents we file with the SEC into this proxy statement, which means that we can
disclose important information to you by referring you to other documents filed separately with the SEC. The information incorporated
by reference is deemed to be part of this proxy statement, except that information that we file later with the SEC will automatically
update and supersede this information. This proxy statement incorporates by reference the documents listed below that have been
previously filed with the SEC (other than, in each case, documents or information deemed to have been furnished and not filed in
accordance with SEC rules):
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•
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Corindus’ Annual Report on Form 10-K for the fiscal year ended December 31, 2018, which was
filed with the SEC on March 18, 2019;
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•
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Corindus’ proxy statement for its 2019 annual meeting of stockholders, which was filed with
the SEC on March 29, 2019;
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•
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Corindus’ Quarterly Reports on Form 10-Q for the quarter ended March 31, 2019 and June 30,
2019, which were filed with the SEC on May 8, 2019 and August 9, 2019; and
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•
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Corindus’ Current Reports on Form 8-K, which were filed with the SEC on February 27, 2019,
March 15, 2019, March 26, 2019, May 8, 2019 and August 8, 2019.
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We also incorporate
by reference into this proxy statement additional documents that Corindus may file with the SEC under Section 13(a), 13(c), 14,
or 15(d) of the Exchange Act, from the date of this proxy statement until the earlier of the date of the special meeting and the
termination of the merger agreement; provided, however, that we are not incorporating by reference any additional documents or
information furnished and not filed with the SEC. A copy of the materials that are incorporated by reference will be promptly delivered
to any stockholder upon written request to Corporate Secretary, Corindus Vascular Robotics, Inc., 309 Waverley Oaks Road, Suite
105, Waltham, MA 02452.
MISCELLANEOUS
You should rely
only on the information contained or incorporated by reference into this proxy statement, the appendices to this proxy statement
and the documents we incorporate by reference into this proxy statement to vote your shares at the special meeting. We have not
authorized anyone to provide you with information that is different from what is contained in this proxy statement. This proxy
statement is dated [●], 2019. You should not assume that the information contained in this proxy statement is accurate as
of any date other than that date (or as of an earlier date if so indicated in this proxy statement) and the mailing of this proxy
statement to stockholders does not create any implication to the contrary. This proxy statement does not constitute a solicitation
of a proxy in any jurisdiction where, or to or from any person to whom, it is unlawful to make a proxy solicitation.
Your vote is
very important. Please promptly vote your shares by completing, signing, dating and returning your proxy card or by Internet
or telephone voting as described on your proxy card.
By Order of the Board of Directors
David W. Long
Corporate Secretary
Waltham, Massachusetts
[●], 2019
Annex A
EXECUTION COPY
AGREEMENT AND PLAN OF
MERGER
by and among
SIEMENS MEDICAL SOLUTIONS
USA, INC.,
CORPUS MERGER, INC.,
and
CORINDUS VASCULAR ROBOTICS,
INC.
Dated as of August 7,
2019
TABLE OF CONTENTS
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Page
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ARTICLE I
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THE MERGER
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Section 1.1
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The Merger
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6
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Section 1.2
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The Closing
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7
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Section 1.3
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Effective Time
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7
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Section 1.4
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Certificate of Incorporation; Bylaws
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7
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Section 1.5
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Board of Directors; Officers
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7
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ARTICLE II
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EFFECT OF THE MERGER ON CAPITAL STOCK; EXCHANGE OF CERTIFICATES
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Section 2.1
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Effect on Capital Stock
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8
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Section 2.2
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Surrender of Certificates
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9
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Section 2.3
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Company Warrants
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11
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Section 2.4
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Company Equity Awards
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11
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Section 2.5
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Lost Certificates
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13
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Section 2.6
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Dissenting Shares
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13
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Section 2.7
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Transfers; No Further Ownership Rights
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14
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Section 2.8
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Further Action
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14
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ARTICLE III
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REPRESENTATIONS AND WARRANTIES OF THE COMPANY
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Section 3.1
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Organization; Qualification
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14
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Section 3.2
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Capitalization; Subsidiaries
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15
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Section 3.3
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Authority Relative to Agreement
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18
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Section 3.4
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Vote Required
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19
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Section 3.5
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No Conflict; Required Filings and Consents
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19
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Section 3.6
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Company SEC Documents; Financial Statements
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20
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Section 3.7
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Absence of Certain Changes or Events
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22
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Section 3.8
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No Undisclosed Liabilities
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23
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Section 3.9
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Litigation
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23
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Section 3.10
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Permits; Compliance with Laws
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24
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Section 3.11
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Proxy Statement
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24
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Section 3.12
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Employee Benefit Plans
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25
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Section 3.13
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Labor Matters
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27
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Section 3.14
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Taxes
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28
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Section 3.15
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Material Contracts
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30
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Section 3.16
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Intellectual Property
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33
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Section 3.17
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Real and Personal Property
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37
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Section 3.18
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Environmental
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38
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Section 3.19
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Customers, Distributors, and Suppliers
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39
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Section 3.20
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Product Warranty
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40
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Section 3.21
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Foreign Corrupt Practices Act; Anti-Corruption
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40
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Section 3.22
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Customs and International Trade Laws
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41
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Section 3.23
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FDA and Related Matters
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42
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Section 3.24
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Healthcare Regulatory Compliance
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44
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Section 3.25
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Insurance
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46
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Section 3.26
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Takeover Statutes
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46
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Section 3.27
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Brokers
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46
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Section 3.28
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Opinion of Financial Advisors
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46
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Section 3.29
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No Other Representations or Warranties
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47
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ARTICLE IV
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REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
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Section 4.1
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Organization; Qualification
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47
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Section 4.2
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Authority Relative to Agreement
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47
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Section 4.3
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No Conflict; Required Filings and Consents
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48
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Section 4.4
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Litigation
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48
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Section 4.5
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Information Supplied
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49
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Section 4.6
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Brokers
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49
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Section 4.7
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Sufficient Funds
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49
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Section 4.8
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Merger Sub
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49
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Section 4.9
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No Interested Stockholder
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49
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Section 4.10
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No Vote of Parent Shareholders
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50
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Section 4.11
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No Other Representations or Warranties
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50
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ARTICLE V
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COVENANTS AND AGREEMENTS
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Section 5.1
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Conduct of Business by the Company Pending the Merger
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51
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Section 5.2
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Proxy Statement; Company Stockholders’ Meeting
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55
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Section 5.3
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Appropriate Action; Consents; Filings
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57
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Section 5.4
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Access to Information; Confidentiality
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59
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Section 5.5
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No Solicitation
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59
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Section 5.6
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Directors’ and Officers’ Indemnification and Insurance
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62
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Section 5.7
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Notification of Certain Matters
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64
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Section 5.8
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Public Disclosure
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65
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Section 5.9
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Intellectual Property Matters
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65
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Section 5.10
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Employee Matters
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66
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Section 5.11
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Merger Sub
|
68
|
Section 5.12
|
Rule 16b-3 Matters
|
68
|
Section 5.13
|
Repayment and Termination of Existing Credit Agreement
|
68
|
Section 5.14
|
Stock Exchange Delisting; Deregistration
|
68
|
Section 5.15
|
State Takeover Laws
|
68
|
Section 5.16
|
Stockholder Litigation
|
69
|
Section 5.17
|
Resignations
|
69
|
Section 5.18
|
Tax Returns
|
69
|
|
|
|
ARTICLE VI
|
|
|
|
CONDITIONS TO THE MERGER
|
|
|
|
Section 6.1
|
Conditions to the Obligations of Each Party
|
69
|
Section 6.2
|
Conditions to the Obligations of Parent and Merger Sub
|
70
|
Section 6.3
|
Conditions to the Obligations of the Company
|
71
|
Section 6.4
|
Frustration of Closing Conditions
|
71
|
|
|
|
ARTICLE VII
|
|
|
|
TERMINATION, AMENDMENT AND WAIVER
|
|
|
|
Section 7.1
|
Termination
|
71
|
Section 7.2
|
Effect of Termination
|
73
|
Section 7.3
|
Termination Fees
|
73
|
Section 7.4
|
Amendment
|
74
|
Section 7.5
|
Extension; Waiver
|
75
|
|
|
|
ARTICLE VIII
|
|
|
|
GENERAL PROVISIONS
|
|
|
|
Section 8.1
|
Non-Survival of Representations and Warranties
|
75
|
Section 8.2
|
Expenses
|
75
|
Section 8.3
|
Notices
|
75
|
Section 8.4
|
Interpretation; Certain Definitions
|
76
|
Section 8.5
|
Severability
|
77
|
Section 8.6
|
Assignment
|
77
|
Section 8.7
|
Entire Agreement
|
77
|
Section 8.8
|
No Third-Party Beneficiaries
|
78
|
Section 8.9
|
Governing Law
|
78
|
Section 8.10
|
Specific Performance
|
78
|
Section 8.11
|
Consent to Jurisdiction
|
78
|
Section 8.12
|
Counterparts
|
79
|
Section 8.13
|
WAIVER OF JURY TRIAL
|
79
|
Section 8.14
|
Definitions
|
79
|
EXHIBITS
Exhibit A
|
Voting and Support Agreement
|
Exhibit B
|
Certificate of Incorporation of the Surviving Corporation
|
Exhibit C
|
Bylaws of the Surviving Corporation
|
Exhibit D
|
Preferred Stockholder Letter
|
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN
OF MERGER (this “Agreement”), dated as of August 7, 2019, is made by and among Siemens Medical Solutions USA,
Inc., a Delaware corporation (“Parent”), Corpus Merger, Inc., a Delaware corporation and a wholly owned Subsidiary
of Parent (“Merger Sub”), and Corindus Vascular Robotics, Inc., a Delaware corporation (the “Company”).
Defined terms used in this Agreement have the respective meanings ascribed to them in Section 8.14.
W I T N E S S E T H:
WHEREAS, the respective
boards of directors of Parent, the Company (the “Company Board”) and Merger Sub have approved and declared advisable
and in the best interests of their respective stockholders, this Agreement and the transactions contemplated by this Agreement,
including the merger of Merger Sub with and into the Company, with the Company surviving as a wholly owned Subsidiary of Parent
(the “Merger”), upon the terms and subject to the conditions and limitations set forth in this Agreement and
in accordance with the General Corporation Law of the State of Delaware (the “DGCL”);
WHEREAS, the Company
Board has, subject to Section 5.5(d) and 5.5(e), resolved to recommend that the Company’s stockholders approve
the adoption of this Agreement;
WHEREAS, concurrently
with the execution and delivery of this Agreement and as an inducement to Parent’s willingness to enter into this Agreement,
each of Parent and certain stockholders of the Company have entered into a voting and support agreement in the form attached as
Exhibit A hereto (the “Voting and Support Agreement”), pursuant to which, and subject to the terms and
limitations thereof, among other things, the foregoing stockholders agreed to vote the shares of Company Common Stock beneficially
owned by each of them in favor of the adoption of this Agreement and approval of the Merger and the other transactions contemplated
hereby at the Company Stockholders’ Meeting; and
WHEREAS, each of Parent,
Merger Sub and the Company desire to make certain representations, warranties, covenants and agreements in connection with the
Merger and also to prescribe various conditions to the Merger.
NOW, THEREFORE, in consideration
of the foregoing and the mutual representations, warranties, agreements and covenants, and subject to the conditions, herein contained,
and intending to be legally bound hereby, the parties hereto hereby agree as follows:
ARTICLE
I
THE MERGER
Section 1.1 The Merger. Upon the terms and subject to the conditions
set forth in this Agreement, and in accordance with the DGCL, at the Effective Time, the Company and Merger Sub shall consummate
the Merger pursuant to which (a) Merger Sub shall be merged with and into the Company and the separate corporate existence of Merger
Sub shall thereupon cease; (b) the Company shall be the surviving corporation in the Merger and shall continue to be governed by
the Laws of the State of Delaware; and (c) the separate corporate existence of the Company with all its rights, privileges, immunities,
powers and franchises shall continue as a wholly owned subsidiary of Parent. The corporation surviving the Merger is hereinafter
referred to as the “Surviving Corporation.” The Merger shall have the effects set forth herein and in the applicable
provisions of the DGCL.
Section 1.2 The Closing. The closing of the Merger (the “Closing”)
shall take place at 10:00 a.m. (local time) on a date to be specified by the parties hereto, but no later than the second (2nd)
Business Day after the satisfaction or (to the extent permitted by Law) waiver of the conditions set forth in Article VI
(other than those conditions that by their terms are to be satisfied at the Closing, but subject to the satisfaction or (to the
extent permitted by Law) waiver of such conditions), unless another time, date or place is agreed to in writing by the parties
hereto (such date being the “Closing Date”). The Closing shall take place at the offices of Blank Rome LLP,
1271 Avenue of the Americas, New York, NY 10020, or by the electronic transmission of signature pages.
Section 1.3 Effective Time. Concurrently with the Closing, the
Company shall cause an appropriate certificate of merger with respect to the Merger (the “Certificate of Merger”)
to be executed, acknowledged and filed with the Delaware Secretary of State as provided under the DGCL. The Merger shall become
effective at the time the Certificate of Merger has been duly filed with the Delaware Secretary of State or at such later date
and time as is agreed between Parent and the Company and specified in the Certificate of Merger (the time the Merger becomes effective
being hereinafter referred to as the “Effective Time”).
Section 1.4 Certificate of Incorporation; Bylaws.
(a) At the Effective Time, the Certificate of Incorporation, as in effect immediately prior to the Effective Time, shall,
by virtue of the Merger, be amended and restated in its entirety as set forth in Exhibit B hereto and, as so amended and
restated, shall be the certificate of incorporation of the Surviving Corporation, until thereafter amended as provided by Law and
such certificate of incorporation (subject to Section 5.6).
(b) At the Effective Time, the bylaws of Merger Sub, as in effect immediately prior to the Effective Time, shall, by
virtue of the Merger, be amended and restated in its entirety as set forth in Exhibit C hereto and, as so amended and restated,
shall be the bylaws of the Surviving Corporation, until thereafter amended as provided by Law, the certificate of incorporation
of the Surviving Corporation and such bylaws.
Section 1.5 Board of Directors; Officers. The members of the
board of directors of Merger Sub immediately prior to the Effective Time shall, from and after the Effective Time, be the members
of the board of directors of the Surviving Corporation, and the officers of the Surviving Corporation shall be designated by Parent
immediately prior to the Effective Time, in each case to hold office, in accordance with the certificate of incorporation and bylaws
of the Surviving Corporation, until the earlier of their death, resignation or removal or until their respective successors shall
have been duly elected, designated or qualified.
ARTICLE
II
EFFECT OF THE MERGER ON CAPITAL STOCK; EXCHANGE OF CERTIFICATES
Section 2.1 Effect on Capital Stock.
(a) Effect of Merger. At the Effective Time, by virtue of the Merger and without any action on the part of the
Company, Parent, Merger Sub or the holders of any Securities of the Company or Merger Sub:
(i) Company Common Stock. Each share of Company Common Stock issued and
outstanding immediately prior to the Effective Time (other than Canceled Shares and Dissenting Shares) shall be converted into
the right to receive, in accordance with the terms of this Agreement, $4.28 per share in cash, without interest (the “Common
Stock Consideration”).
(ii) Company Preferred Stock. Each share of (A) Company Preferred Stock issued and outstanding immediately prior
to the Effective Time and (B) Series A-1 Preferred Stock that has accrued and accumulated on a daily basis until the Effective
Time, in accordance with the provisions of the Company Certificate of Designation, but which is not otherwise issued or outstanding
immediately prior to the Effective Time, in each case other than Canceled Shares and Dissenting Shares, shall be converted into
the right to receive, in accordance with the terms of this Agreement, an amount in cash equal to $85.60 per share, without interest
(the “Preferred Stock Consideration”).
(iii) Cancellation of Company Securities. Each share
of Company Stock held by the Company as treasury stock or held directly by Parent or any Subsidiary of Parent (including Merger
Sub) immediately prior to the Effective Time shall no longer be outstanding and shall automatically be canceled and retired and
shall cease to exist, and no consideration or payment shall be delivered in exchange therefor or in respect thereof (such shares,
“Canceled Shares”).
(iv) Conversion of Merger Sub Capital Stock. Each
share of common stock, par value $0.0001 per share, of Merger Sub issued and outstanding immediately prior to the Effective Time
shall be converted into and become one (1) fully paid share of common stock, par value $0.0001 per share, of the Surviving Corporation
and constitute the only outstanding shares of capital stock of the Surviving Corporation.
(b) Certificates; Book Entry Shares. Each share of Company Stock to be converted into the right to receive the
applicable Merger Consideration as provided in Section 2.1(a) shall no longer be outstanding and shall be automatically
canceled and shall cease to exist, and the holders of certificates (the “Certificates”) or book-entry shares
(“Book-Entry Shares”), which immediately prior to the Effective Time represented such Company Stock, shall cease
to have any rights with respect to such Company Stock other than the right to receive, upon surrender of such Certificates or Book-Entry
Shares in accordance with Section 2.2, the applicable Merger Consideration.
(c) Adjustments. Without limiting the other provisions of this Agreement, if at any time during the period between
the date of this Agreement and the Effective Time, any change in the number or type of outstanding shares of Company Stock shall
occur as a result of a reclassification, recapitalization, exchange, stock split (including a reverse stock split) or combination
or readjustment of shares or any similar event or any stock dividend or stock distribution with a record date during such period,
the applicable Merger Consideration and any other similarly dependent amounts and items, as the case may be, shall be appropriately
adjusted to provide the same economic effect as contemplated by this Agreement prior to such event. Nothing in this Section
2.1(c) shall be construed to permit the Company to take any action that is otherwise prohibited or restricted by any other
provision of this Agreement.
Section 2.2 Surrender of Certificates.
(a) Designation of Paying Agent; Deposit of Funds. Prior to the Closing, Parent shall, at its sole cost and expense,
enter into a customary paying agent agreement with a nationally recognized financial institution designated by Parent that is reasonably
acceptable to the Company (the “Paying Agent”) for the payment of the Aggregate Merger Consideration as provided
in Section 2.1(a)(i) and Section 2.1(a)(ii). At or prior to the Effective Time, Parent shall deposit or cause to
be deposited with the Paying Agent, for payment in accordance with this Article II through the Paying Agent, cash in immediately
available funds in an amount sufficient to pay (i) the Aggregate Merger Consideration in exchange for all of the shares of Company
Stock outstanding immediately prior to the Effective Time (other than Canceled Shares or Dissenting Shares) and (ii) the Warrant
Consideration (the “Payment Fund”). The Payment Fund shall be invested by the Paying Agent if and as directed
by Parent or the Surviving Corporation pending payment thereof by the Paying Agent to the holders of the shares of Company Stock,
provided, however, that no such investment or loss thereon shall affect the amounts payable to the holders of the
shares of Company Stock pursuant to Section 2.1(a) and to the extent of any such loss, Parent shall promptly fund additional
cash amounts to the Paying Agent sufficient to enable payment of such amounts. Earnings from such investments shall be the sole
and exclusive property of Parent and the Surviving Corporation, and no part of such earnings shall accrue to the benefit of holders
of shares of Company Stock.
(b) As promptly as reasonably practicable after the Effective Time (and in any event within five (5) Business Days after
the Effective Time), Parent shall cause the Paying Agent to mail to each holder of record of a Certificate that immediately prior
to the Effective Time represented outstanding shares of Company Stock (i) a letter of transmittal (which shall specify that
delivery of Certificates shall be effected, and risk of loss and title to the Certificates shall pass only upon proper delivery
of the Certificates (or affidavits of loss in lieu thereof as provided in Section 2.5) to the Paying Agent, and which shall
be in the form and have such other customary provisions as Parent may reasonably specify) and (ii) instructions (which instructions
shall be in the form and have such other customary provisions as Parent may reasonably specify) for use in effecting the surrender
of the Certificates in exchange for cash in an amount equal to the applicable Merger Consideration multiplied by the number of
shares of Company Stock previously represented by such Certificates.
(c) Upon surrender of a Certificate (or affidavit of loss in lieu thereof as provided in Section 2.5) for cancellation
to the Paying Agent, together with a letter of transmittal duly completed and validly executed in accordance with the instructions
thereto, and such other documents as may reasonably be required by the Paying Agent, the holder of such Certificate shall be entitled
to receive in exchange therefor, and Parent shall cause the Paying Agent to pay and deliver in exchange therefor as promptly as
reasonably practicable cash in an amount equal to the applicable Merger Consideration multiplied by the number of shares of Company
Stock previously represented by such Certificate, and the Certificate (or affidavit of loss in lieu thereof as provided in Section
2.5) so surrendered shall be forthwith cancelled. Each Book-Entry Share shall automatically upon the Effective Time be entitled
to receive, and Parent shall cause the Paying Agent to pay and deliver in exchange therefor as promptly as reasonably practicable
after the Effective Time, cash in an amount equal to the applicable Merger Consideration multiplied by the number of shares of
Company Stock previously represented by such Book-Entry Share. Until surrendered, in the case of a Certificate, or paid, in the
case of a Book-Entry Share, in each case, as contemplated by this Section 2.2(c), each Certificate or Book-Entry Share shall
be deemed, from and after the Effective Time, to represent only the right to receive the applicable Merger Consideration as contemplated
by this Section 2.2(c). The Paying Agent shall accept such Certificates (or affidavits of loss in lieu thereof as provided
in Section 2.5) and make such payments and deliveries with respect to Book-Entry Shares upon compliance with such reasonable
terms and conditions as the Paying Agent may impose to effect an orderly exchange thereof in accordance with customary exchange
practices. No interest shall be paid or accrued for the benefit of holders of the Certificates or Book-Entry Shares on the cash
amounts payable pursuant to this Section 2.2(c).
(d) Unregistered Transfers. In the event of a transfer of ownership of Company Stock, as applicable, that is not
registered in the transfer records of the Company, payment of the appropriate amount of the applicable Merger Consideration may
be made to a Person other than the Person in whose name the Certificate or Book-Entry Share so surrendered is registered, if such
Certificate shall be properly endorsed or otherwise be in proper form for transfer (and accompanied by all documents reasonably
required by the Paying Agent) or such Book-Entry Share shall be properly transferred and the Person requesting such payment shall
pay any transfer or other Taxes required by reason of the payment to a Person other than the registered holder of such Certificate
or Book-Entry Share or establish to the satisfaction of Parent that such Tax has been paid or is not applicable.
(e) Termination of Fund. Any portion of the Payment Fund made available to the Paying Agent, which remains undistributed
to the holders of the Certificates or Book-Entry Shares six (6) months after the Effective Time, shall be delivered to the Surviving
Corporation or its designee upon demand, and any such holders prior to the Merger who have not theretofore complied with this Article
II shall thereafter look only to the Surviving Corporation as general creditor thereof for payment of their claims for the
applicable Merger Consideration.
(f) No Liability. None of Parent, Merger Sub, the Company or the Paying Agent shall be liable to any Person in
respect of any applicable Merger Consideration delivered to a Governmental Authority pursuant to any applicable abandoned property,
escheat or similar Law. If any Certificate shall not have been surrendered or Book-Entry Share not paid, in each case, in accordance
with Section 2.2(c), immediately prior to the date on which any Common Stock Consideration or Preferred Stock Consideration
in respect of such Certificate or Book-Entry Share would otherwise escheat to or become the property of any Governmental Authority
under applicable Law, any such Common Stock Consideration or Preferred Stock Consideration in respect of such Certificate or Book-Entry
Share shall, to the extent permitted by applicable Law, become the property of the Surviving Corporation free and clear of all
claims or interest of any Person previously entitled thereto.
(g) Withholding. Parent, the Company, the Surviving Corporation, any of their applicable Subsidiaries and the
Paying Agent shall be entitled to deduct and withhold from the applicable Merger Consideration and any amounts otherwise payable
pursuant to this Agreement such amounts as Parent, the Company, the Surviving Corporation, any of their applicable Subsidiaries
or the Paying Agent is required to deduct and withhold with respect to the making of such payment under the Code or any provision
of applicable Tax Law. Any amounts so withheld and paid over to an applicable Governmental Authority as required by applicable
Law shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and
withholding was made by Parent, the Company, the Surviving Corporation, any of their applicable Subsidiaries or the Paying Agent.
Section 2.3 Company Warrants. Neither Parent nor Merger Sub shall
assume any Company Warrant or substitute for any Company Warrant any similar warrant for Parent Common Stock in connection with
the Merger or any of the other transactions contemplated by this Agreement. At the Effective Time, each Company Warrant that is
outstanding and unexercised immediately prior thereto shall by virtue of the Merger and without any further action on the part
of any holder of any Company Warrant be cancelled and converted into the right to receive from the Company at the Effective Time
a cash payment (without interest) equal to (i) the product of (A) the excess, if any, of (1) the Common Stock Consideration over
(2) the per share exercise price of such Company Warrant, and (B) the number of shares of Company Common Stock subject to such
Company Warrant as of the Effective Time (the “Warrant Consideration”), less (ii) any applicable withholding
Taxes required by applicable Law to be withheld. As of the Effective Time, all Company Warrants shall no longer be outstanding
and shall automatically cease to exist, and each holder of a Company Warrant shall cease to have any rights with respect thereto,
except the right to receive the Warrant Consideration. For the avoidance of doubt, if the exercise price payable in respect of
a share of Company Common Stock underlying a Company Warrant equals or exceeds the Common Stock Consideration, such Company Warrant
shall be cancelled for no consideration immediately prior to the Effective Time and the holder thereof shall have no further rights
with respect thereto.
Section 2.4 Company Equity Awards.
(a) Treatment of Company Options. Neither Parent nor Merger Sub shall assume any Company Option or substitute
for any Company Option any similar award for Parent Common Stock in connection with the Merger and any of the other transactions
contemplated by this Agreement. At the Effective Time, each Company Option that is outstanding and unexercised immediately prior
thereto, whether vested or unvested, shall by virtue of the Merger and without any action on the part of any holder of any Company
Option be cancelled and converted into the right to receive from the Company at the Effective Time a cash payment (without interest)
equal to (i) the product of (A) the excess, if any, of (1) the Common Stock Consideration over (2) the per share exercise price
of such Company Option, and (B) the number of shares of Company Common Stock subject to such Company Option as of the Effective
Time (the “Option Consideration”), less (ii) any applicable withholding Taxes required by applicable Law to
be withheld. As of the Effective Time, all Company Options shall no longer be outstanding and shall automatically cease to exist,
and each holder of a Company Option shall cease to have any rights with respect thereto, except the right to receive the Option
Consideration. For the avoidance of doubt, if the exercise price payable in respect of a share of Company Common Stock underlying
a Company Option equals or exceeds the Common Stock Consideration, such Company Option shall be cancelled for no consideration
immediately prior to the Effective Time and the holder thereof shall have no further rights with respect thereto.
(b) Treatment of Company RSU Awards. Neither Parent nor Merger Sub shall assume any Company RSU Award or substitute
for any Company RSU Award any similar award for Parent Common Stock in connection with the Merger and the other transactions contemplated
by this Agreement. As of the Effective Time, each Company RSU Award that is outstanding immediately prior to the Effective Time,
whether vested or unvested, shall by virtue of the Merger and without any action on the part of any holder of any Company RSU Award
be cancelled and converted into the right to receive from the Company at the Effective Time a cash payment (without interest) equal
to (i) the product of (A) the Common Stock Consideration and (B) the number of shares of Company Common Stock subject
to such Company RSU Award as of the Effective Time (the “RSU Consideration”), less (ii) any applicable
withholding Taxes required by applicable Law to be withheld; provided, that, notwithstanding anything to the contrary contained
in this Agreement, any payment in respect of any Company RSU Award which immediately prior to such cancellation is “deferred
compensation” subject to Section 409A of the Code shall be made on the applicable settlement date(s) for such Company
RSU Award if required in order to comply with Section 409A of the Code.
(c) Method of Payment. Any Option Consideration or RSU Consideration to which an employee or former employee of
the Company or one of its Subsidiaries becomes entitled pursuant to Section 2.4(a) or Section 2.4(b), together with
the employer portion of any payroll Taxes on such payment, shall be paid through the payroll of the Surviving Corporation or one
of its Subsidiaries, or the Paying Agent, as applicable, as soon as reasonably practicable following the Effective Time (and in
any event, within ten (10) Business Days after the Closing Date). Any Option Consideration or RSU Consideration to which any other
person becomes entitled pursuant to Section 2.4(a) or Section 2.4(b) shall be paid by the Surviving Corporation or
one of its Subsidiaries, as applicable (or, at the option of the Surviving Corporation, by the Paying Agent), as soon as reasonably
practicable following the Effective Time (and in any event, within ten (10) Business Days after the Closing Date).
(d) Company Actions. Prior to the Effective Time, the Company shall provide such notice, if any, to the extent
required under the terms of any of the Company Equity Plans, Company Warrants or Company Preferred Stock, as applicable, obtain
any necessary consents or waivers, adopt applicable resolutions, amend the terms of any of the Company Equity Plans (or any outstanding
awards thereunder), Company Warrants or Company Preferred Stock, as applicable, including obtaining an executed letter, substantially
in the form attached hereto as Exhibit D (“Preferred Stockholder Letter”), from each holder of Company
Preferred Stock, and take all other appropriate actions to (i) give effect to the transactions contemplated herein; (ii) terminate
each of the Company Equity Plans as of the Effective Time; and (iii) ensure that after the Effective Time, no holder of a Company
Equity Award, any beneficiary thereof nor any other participant in any of the Company Equity Plans and no holder of a Company Warrant
or Company Preferred Stock or any beneficiary thereof shall have any right thereunder to acquire any Securities of the Company
or to receive any payment or benefit with respect to (x) any award previously granted under any of the Company Equity Plans or
(y) any Company Warrant or Company Preferred Stock, as applicable, except as provided in Section 2.3 and Section 2.4.
The Company shall provide Parent with documentation evidencing the completion of the foregoing actions (the form and substance
of such documentation shall be subject to review and approval by Parent, such approval not to be unreasonably withheld, conditioned
or delayed) no later than the Business Day preceding the Effective Time.
Section 2.5 Lost Certificates. If any Certificate shall have
been lost, stolen or destroyed, then upon the making of an affidavit of that fact by the Person claiming such Certificate to be
lost, stolen or destroyed and, if required by the Paying Agent or Parent, the posting by such Person of a bond, in such reasonable
and customary amount as the Paying Agent or Parent may direct, as indemnity against any claim that may be made against it with
respect to such Certificate, the Paying Agent will issue in exchange for such lost, stolen or destroyed Certificate the applicable
Merger Consideration to which the holder thereof is entitled pursuant to this Article II.
Section 2.6 Dissenting Shares. Notwithstanding anything in this
Agreement to the contrary, to the extent that holders of Company Stock are entitled to appraisal rights under Section 262 of the
DGCL, any shares of Company Stock issued and outstanding immediately prior to the Effective Time and held by a holder who has properly
exercised and perfected his, her or its demand for appraisal rights under Section 262 of the DGCL and not effectively withdrawn
or lost such holder’s rights to appraisal (the “Dissenting Shares”), shall not be converted into or represent
the right to receive the applicable Merger Consideration, but the holders of such Dissenting Shares shall instead be entitled to
receive such consideration as may be determined pursuant to Section 262 of the DGCL (it being understood and acknowledged that
at the Effective Time, such Dissenting Shares shall no longer be outstanding, shall automatically be canceled and shall cease to
exist and such holder shall cease to have any rights with respect thereto other than the right to receive the consideration therefor
as may be determined in accordance with Section 262 of the DGCL); provided, however, that if any such holder shall
have failed to timely perfect or shall have waived, effectively withdrawn or lost his, her or its right to appraisal and payment
under the DGCL (whether occurring before, at or after the Effective Time), or a court of competent jurisdiction shall have determined
that such holder is not entitled to such right to appraisal and payment under Section 262 of the DGCL, such holder’s shares
of Company Stock shall thereupon be deemed to have been converted as of the Effective Time into the right to receive the applicable
Merger Consideration, without any interest thereon, and such shares shall no longer be deemed to be Dissenting Shares. The Company
shall give prompt notice to Parent of any demands for appraisal of any shares of Company Stock, effective or attempted withdrawals
of such demands and any other instruments served pursuant to the DGCL received by the Company relating to appraisal demands, and
Parent shall have the opportunity and right to participate in all discussions, negotiations and Proceedings, with respect to such
demands. Prior to the Effective Time, the Company shall not, without the prior written consent of Parent (such consent not to be
unreasonably conditioned, delayed or withheld), voluntarily make any payment with respect to or settle or compromise or offer to
settle or compromise any such demand or Proceeding, or agree in writing to do any of the foregoing.
Section 2.7 Transfers; No Further Ownership Rights. At the Effective
Time, the stock transfer books of the Company shall be closed, and from and after the Effective Time, there shall be no registration
of transfers on the stock transfer books of the Company of shares of Company Stock that were outstanding immediately prior to the
Effective Time. If Certificates or Book-Entry Shares are presented to the Surviving Corporation, Parent or the Paying Agent for
transfer following the Effective Time, they shall be canceled against delivery of the applicable Merger Consideration, as provided
for in Section 2.1(a), for each share of Company Stock formerly represented by such Certificates or Book Entry Shares.
Section 2.8 Further Action. If, at any time after the Effective
Time any further action is determined by Parent or the Surviving Corporation to be necessary or desirable to carry out the purposes
of this Agreement or to vest the Surviving Corporation or Parent with full right, title and possession of and to all rights and
property of Merger Sub and the Company with respect to the Merger, the officers and directors of Parent shall be fully authorized
(in the name of Merger Sub, the Company, the Surviving Corporation and otherwise) to take such action.
ARTICLE
III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except (a) as disclosed
in the Company Disclosure Letter referenced therein (it being understood and agreed that any disclosure set forth in one section
or subsection of the Company Disclosure Letter also shall be deemed to apply to each other section and subsection of the Company
Disclosure Letter to which its applicability is reasonably apparent) or (b) other than with respect to Section 3.2(a) and
Section 3.2(g), as disclosed in the Company SEC Documents filed with (or furnished to) the SEC by the Company on or after
December 31, 2018 and at least two (2) Business Days prior to the date of this Agreement (but in each case excluding any disclosure
contained under the heading “Risk Factors,” or “Cautionary Note Regarding Forward-Looking Statements” or
safe harbor or in any “forward-looking statements” legend or any similar non-specific, predictive, precautionary or
forward-looking statements) and to the extent publicly available on the SEC’s Electronic Data Gathering Analysis and Retrieval
System, the Company hereby represents and warrants to Parent and Merger Sub as follows:
Section 3.1 Organization; Qualification.
(a) The Company is (i) a corporation duly organized and validly existing under the Laws of the State of Delaware and
has the requisite corporate power and authority to conduct its business as it is now being conducted and to own, lease and operate
its properties and assets in the manner in which its properties and assets are currently operated and (ii) duly qualified or licensed
to do business and is in good standing in each jurisdiction in which the character or location of the property owned, leased or
operated by it or the nature of the business conducted by it makes such qualification or licensing necessary, except where the
failure to be so duly qualified or licensed and in good standing has not had, and would not reasonably be expected to have, individually
or in the aggregate, a Company Material Adverse Effect. The Company’s Certificate of Incorporation (the “Certificate
of Incorporation”) and Bylaws (the “Bylaws”), each as amended as of the date of this Agreement, have
been made available to Parent and are in full force and effect, and the Company is not in violation of any of the provisions thereof.
(b) Each of the Company’s Subsidiaries is (i) a legal entity duly organized and validly existing under the Laws
of the jurisdiction of its incorporation, formation or organization, as applicable, and has the requisite corporate or similar
power and authority to conduct its business as it is now being conducted and to own, lease and operate its properties and assets
in the manner in which its properties and assets are currently operated and (ii) duly qualified or licensed to do business and
is in good standing in each jurisdiction in which the character or location of the property owned, leased or operated by it or
the nature of the business conducted by it makes such qualification or licensing necessary, except where the failure to be so duly
qualified or licensed and in good standing has not had, and would not reasonably be expected to have, individually or in the aggregate,
a Company Material Adverse Effect. Except as has not had, and would not reasonably be expected to have, individually or in the
aggregate, a Company Material Adverse Effect, the organizational or governing documents of each of the Company’s Subsidiaries
are in full force and effect, and none of the Company’s Subsidiaries is in violation of any of the respective provisions
thereof.
Section 3.2 Capitalization; Subsidiaries.
(a) As of the close of business on August 5, 2019 (the “Capitalization Date”), the authorized capital
stock of the Company consisted of (i) 350,000,000 shares of Company Common Stock, 208,533,915 of which were issued and outstanding
and none of which were held by the Company as treasury stock, and (ii) 10,000,000 shares of preferred stock of the Company, par
value $0.0001 per share, 1,000,000 shares of which constitute a series of preferred stock designated as Series A Convertible Preferred
Stock, 1,000,000 of which were issued and outstanding (“Series A Preferred Stock”), and 1,000,000 shares of
which constitute a series of preferred stock designated as Series A-1 Convertible Preferred Stock, 167,248 of which were issued
and outstanding (or, to the extent not issued or outstanding, had otherwise accrued until the Capitalization Date) (“Series
A-1 Preferred Stock” and together with Series A Preferred Stock, “Company Preferred Stock”). Except
for the foregoing, there are no other classes of capital stock of the Company and, except for Company Equity Awards, Company Warrants
and Company Preferred Stock, there are no bonds, debentures, notes or other Indebtedness or Securities of the Company having the
right to vote (or convertible into or exercisable for Securities having the right to vote) on any matters on which holders of capital
stock of the Company may vote authorized, issued or outstanding. As of the close of business on the Capitalization Date, there
were (A) outstanding Company Options to purchase 26,426,312 shares of Company Common Stock; (B) outstanding Company RSU Awards
representing 124,422 shares of Company Common Stock; (C) 8,611,196 shares of Company Common Stock reserved for future issuance
under the Company Equity Plans; (D) 9,191,287 shares of Company Common Stock reserved for issuance upon exercise of Company Warrants;
and (E) 23,344,957 shares of Company Common Stock reserved for issuance upon conversion of Company Preferred Stock. As of the close
of business on the Capitalization Date, the 2014 Warrant had been exercised in full and was no longer outstanding. From the close
of business on the Capitalization Date through the date of this Agreement, there have been (1) no issuances of any Company Common
Stock, Company Preferred Stock or any other Securities of the Company other than issuances of shares of Company Common Stock pursuant
to (i) the conversion of any of Company Preferred Stock outstanding as of the close of business on the Capitalization Date in accordance
with the terms of the Certificate of Incorporation, or (ii) the exercise, vesting or settlement, as applicable, of any Company
Equity Awards or Company Warrants outstanding as of the close of business on the Capitalization Date in accordance with the terms
of such Company Equity Awards or Company Warrants and (2) no grants of any Company Equity Awards or any other equity or equity-based
awards.
(b) All of the issued and outstanding shares of Company Common Stock have been, and all of the shares of Company Common
Stock that may be issued pursuant to any of the Company Equity Awards, the Company Equity Plans, Company Warrants and Company Preferred
Stock will be, when issued in accordance with the respective terms thereof, duly authorized and validly issued and are, or will
be when issued, fully paid, nonassessable and free of preemptive rights. All of the issued and outstanding shares of Company Preferred
Stock have been duly authorized, validly issued, fully paid and nonassessable. The Company has made available to Parent or its
counsel accurate and complete copies of each of the Company Warrants (which copies are executed) and the forms of stock option
and restricted stock unit award agreements evidencing the Company Equity Awards (together with the forms of such award agreements
filed with the SEC and publicly available), and in respect of the foregoing forms, other than differences with respect to the number
of shares of Company Common Stock covered thereby, the grant date, the exercise price, regular vesting schedule and expiration
date applicable thereto, no such stock option or restricted stock unit award agreement contains material terms that are inconsistent
with, or in addition to, such forms. Section 3.2(b) of the Company Disclosure Letter sets forth, as of the close of business
on the Capitalization Date, each outstanding Company Equity Award and to the extent applicable, (i) the name and country of residence
(if outside the U.S.) of the holder thereof, (ii) the number of shares of Company Common Stock issued or issuable thereunder, (iii)
the expiration date, (iv) the exercise price relating thereto, (v) the grant date, (vi) the amount vested and outstanding and the
amount unvested and outstanding, and (vii) the Company Equity Plan pursuant to which the award was made. Each grant of a Company
Option was duly authorized no later than the date on which the grant of such Company Option was by its terms to be effective (the
“Company Option Grant Date”) by all necessary corporate action, including, as applicable, approval by the Company
Board (or a duly constituted and authorized committee thereof or other authorized designee) and any required stockholder approval
by the necessary number of votes or written consents. The Company does not have any liability in respect of any Company Option
that was granted with a per share exercise price that was less than the fair market value of a share of Company Common Stock on
the applicable Company Option Grant Date, and the Company has not granted any Company Options that are subject to the provisions
of Section 409A of the Code. Each grant of a Company Equity Award and Company Warrant was made in all material respects, as applicable,
in accordance with (A) the terms of the applicable Company Equity Plan, (B) all applicable securities Laws, including the NYSE
American Company Guide, (C) the Code, and (D) all other applicable Laws. The Company has the requisite authority under the terms
of the applicable Company Equity Plan, the applicable award agreements and any other applicable Contract to take the actions contemplated
by Section 2.3 and Section 2.4, and the treatment of Company Warrants and Company Equity Awards described in Section
2.3 and Section 2.4, shall, as of the Effective Time, be binding on the holders of Company Warrants and Company Equity
Awards purported to be covered thereby. All of the outstanding Company Stock has been sold pursuant to an effective registration
statement filed under the federal securities Laws or an appropriate exemption therefrom. No Subsidiary of the Company owns any
Securities of the Company.
(c) As of the date of this Agreement, other than as set forth in Section 3.2(c) of the Company Disclosure Letter,
the Company Equity Awards, Company Warrants or in the Company Certificate of Designation, there are no (i) existing options, warrants,
calls, preemptive rights, subscriptions or other Securities or rights, stock appreciation rights, restricted stock awards, restricted
stock unit awards, convertible Securities, agreements, arrangements or commitments of any kind obligating the Company or any of
its Subsidiaries to issue, transfer, register or sell, or cause to be issued, transferred, registered or sold, any shares of capital
stock of, or other Securities of, the Company or any of its Subsidiaries or Securities convertible into or exchangeable for such
shares or other Securities, or obligating the Company or any of its Subsidiaries to grant, extend or enter into such options, warrants,
calls, preemptive rights, subscriptions or other Securities or rights, stock appreciation rights, restricted stock awards, restricted
stock unit awards, convertible Securities, agreements, arrangements or commitments; (ii) outstanding obligations of the Company
or any of its Subsidiaries to repurchase, redeem or otherwise acquire any Securities of the Company or any of its Subsidiaries,
or any Securities representing the right to purchase or otherwise receive any other Securities of the Company or any of its Subsidiaries;
or (iii) outstanding or authorized equity or equity-based compensation awards, including any equity appreciation rights, Security-based
performance units, “phantom” stock, profit-participation or other Security rights issued by the Company or any of its
Subsidiaries, or other agreements, arrangements or commitments of any character (contingent or otherwise) to which the Company
or any of its Subsidiaries is party, in each case pursuant to which any Person is entitled to receive any payment from the Company
or any of its Subsidiaries based in whole or in part on the value of any Securities of the Company or any of its Subsidiaries.
(d) Each Subsidiary of the Company existing on the date of this Agreement is listed on Section 3.2(d) of the Company
Disclosure Letter. The Company owns, beneficially and of record, directly or indirectly, all of the issued and outstanding
company, partnership, corporate or similar (as applicable) ownership, voting or similar Securities or interests in each such Subsidiary,
free and clear of all Liens, and all company, partnership, corporate or similar (as applicable) ownership, voting or similar Securities
or interests of each of the Subsidiaries are duly authorized and validly issued and are fully paid, nonassessable and free of preemptive
rights. The Company has made available to Parent true and correct copies of the currently effective corporate or other organizational
documents for each Subsidiary. Except for investments in cash equivalents (and ownership by the Company or its Subsidiaries of
Securities of the Subsidiaries of the Company), none of the Company or any of its Subsidiaries (i) owns directly or indirectly
any Securities or interests or (ii) has any obligation or has made any commitment to acquire any Securities or interests of any
Person or to provide funds to or make any investment (in the form of a loan, capital contribution or otherwise) in any Person.
(e) All dividends or distributions on any Securities of the Company or any of its Subsidiaries that have been declared
or authorized have been paid in full.
(f) As of the date of this Agreement, there are no existing (i) agreements or commitments of any kind with any Person
to which the Company or any of its Subsidiaries is party (A) restricting the transfer of the Securities of the Company or any of
its Subsidiaries or (B) affecting the voting rights of Securities of the Company or any of its Subsidiaries (including stockholder
agreements, voting trusts or similar agreements), (ii) agreements or commitments of any kind obligating the Company or any of its
Subsidiaries to register (other than pursuant to currently effective resale shelf registration statements listed on Section
3.2(f) of the Company Disclosure Letter or “piggy-back” rights) or cause to be further registered (other
than pursuant to currently effective resale shelf registration statements listed on Section 3.2(f) of the Company Disclosure
Letter or “piggy-back” rights), any shares of capital stock of, or other Securities of, the Company or any of its
Subsidiaries or Securities convertible into or exchangeable for such shares or other Securities (“Demand Registration
Rights Agreements”) or (iii) stockholder rights plans or similar plans commonly referred to as a “poison pill,”
under which the Company is or may become obligated to sell or otherwise issue any shares of its capital stock or any other Securities.
(g) The exercise price of each Company Option and each Company Warrant is set forth on Section 3.2(g) of the Company
Disclosure Letter as of the date of this Agreement.
Section 3.3 Authority Relative to Agreement.
(a) The Company has all necessary corporate power and authority to execute, deliver and perform its obligations under
this Agreement and, subject (in the case of the Merger) to obtaining the Company Stockholder Approval, to consummate the transactions
contemplated by this Agreement. The execution, delivery and performance of this Agreement by the Company, and the consummation
by the Company of the transactions contemplated by this Agreement, have been duly and validly authorized by all necessary corporate
action by the Company, and (in the case of the Merger, except for the (i) receipt of the Company Stockholder Approval and (ii)
filing of the Certificate of Merger with the Delaware Secretary of State) no other corporate action or proceeding on the part of
the Company is necessary to authorize the execution, delivery and performance of this Agreement by the Company and the consummation
by the Company of the transactions contemplated by this Agreement. This Agreement has been duly executed and delivered by the Company
and, assuming due authorization, execution and delivery of this Agreement by the other parties hereto, constitutes a legal, valid
and binding obligation of the Company, enforceable against the Company in accordance with its terms, except that (A) such
enforcement may be subject to applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws, now or hereafter
in effect, affecting creditors’ rights and remedies generally and (B) the remedies of specific performance and injunctive
and other forms of equitable relief may be subject to equitable defenses and to the discretion of the court before which any Proceeding
therefor may be brought (the “Enforceability Exceptions”).
(b) The Company Board has, by resolutions adopted by the Company Board, (i) approved this Agreement and the Merger
and the transactions contemplated by this Agreement; (ii) determined that this Agreement and the Merger and the transactions
contemplated by this Agreement are advisable and in the best interests of the Company and its stockholders; (iii) directed
that the adoption of this Agreement be submitted to a vote at the Company Stockholders’ Meeting; and (iv) resolved to
make the Company Recommendation. As of the date of this Agreement, none of the aforesaid actions by the Company Board has been
amended, rescinded or modified.
Section 3.4 Vote Required. The affirmative vote of the holders
of a majority of the outstanding shares of Company Common Stock and Company Preferred Stock voting together as a single class,
with holders of Company Preferred Stock entitled to vote on an as-converted-to-common stock basis and cast a number of votes per
share of Company Preferred Stock as determined in accordance with Section 11(a) of the Company Certificate of Designation (the
“Company Stockholder Approval”) is the only vote or consent, as applicable, of holders of Securities of the
Company that is required to authorize this Agreement or to consummate the Merger and the other transactions contemplated by this
Agreement.
Section 3.5 No Conflict; Required Filings and Consents.
(a) Neither the execution and delivery of this Agreement by the Company nor the consummation by the Company of the transactions
contemplated by this Agreement, nor compliance by the Company with any of the terms or provisions of this Agreement, will (i) violate
any provision of (A) the Company’s Certificate of Incorporation or Bylaws or (B) the certificate of incorporation or bylaws
(or equivalent organizational documents) of any Subsidiary of the Company (assuming, in each case, with respect to the consummation
of the Merger that the Company Stockholder Approval is obtained), (ii) assuming that the Consents, registrations, declarations,
filings and notices referenced in Section 3.5(b) have been obtained or made, conflict with or violate any Law applicable
to the Company or any of its Subsidiaries or by which any property or asset of the Company or any of its Subsidiaries is bound
or affected or (iii) violate, conflict with or result in any breach of any provision of, or loss of any benefit, or constitute
a default (with or without notice or lapse of time, or both) under, give rise to any right of termination, acceleration or cancellation
of or require the Consent of, notice to or filing with any third Person pursuant to any of the terms or provisions of any material
Contract to which the Company or any of its Subsidiaries is a party (other than a Benefit Plan) or by which any property or asset
of the Company or any of its Subsidiaries is bound, or result in the creation of a Lien, other than any Permitted Lien, upon any
of the property or assets of the Company or any of its Subsidiaries, other than, in the case of clauses, (i)(B), (ii) and (iii),
that has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.
(b) No consent, approval, license, permit, waiver, Order or authorization (a “Consent”) of, registration,
submission, declaration or filing with or notice to any Governmental Authority is required to be obtained or made by or with respect
to the Company or any of its Subsidiaries in connection with the execution, delivery and performance of this Agreement or the consummation
of the transactions contemplated by this Agreement, other than (i) applicable requirements of and filings with the SEC under
the Exchange Act or the Securities Act; (ii) the filing of the Certificate of Merger with the Delaware Secretary of State;
(iii) applicable requirements under foreign qualification, state securities or “blue sky” laws of various states;
(iv) compliance with applicable rules and regulations of the NYSE American; (v) compliance with and filings or notifications
under the HSR Act and any other applicable United States or foreign competition, antitrust, merger control or investment Laws (together
with the HSR Act, “Antitrust Laws”); and (vi) such other Consents, registrations, declarations, filings
or notices the failure of which to be obtained or made has not had, and would not reasonably be expected to have, individually
or in the aggregate, a Company Material Adverse Effect.
Section 3.6 Company SEC Documents; Financial Statements.
(a) Since January 1, 2016, the Company has timely filed with (or furnished to) the SEC all forms, reports, schedules,
statements, exhibits and other documents (including exhibits, financial statements and schedules thereto and all other information
incorporated therein and amendments and supplements thereto) required by it to be filed (or furnished) under the Exchange Act or
the Securities Act (collectively, but excluding the Proxy Statement, the “Company SEC Documents”). As of its
filing (or furnishing) date or, if amended prior to the date of this Agreement, as of the date of the last such amendment (or in
the case of Company SEC Documents that are registration statements filed pursuant to the requirements of the Securities Act, as
of their respective effective dates), each Company SEC Document complied in all material respects with the applicable requirements
of the Exchange Act and the Securities Act, as the case may be. As of its filing date or, if amended or superseded by a filing
or amendment prior to the date of this Agreement, as of the date of the last such amendment, each Company SEC Document filed pursuant
to the Exchange Act did not contain any untrue statement of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements made therein, in light of the circumstances under which they were made, not
misleading. Each Company SEC Document that is a registration statement, as amended or supplemented, if applicable, filed pursuant
to the Securities Act, as of the date such registration statement or amendment became effective prior to the date of this Agreement,
did not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary
in order to make the statements made therein not misleading. As of the date of this Agreement, there are no amendments or modifications
to the Company SEC Documents that are required to be filed with (or furnished to) the SEC, but that have not yet been filed with
(or furnished to) the SEC. No Subsidiary of the Company is subject to the periodic reporting requirements of the Exchange Act.
All of the consolidated audited financial statements and unaudited interim financial statements of the Company included in the
Company SEC Documents (i) have been derived from the accounting books and records of the Company and its Subsidiaries; (ii) comply
in all material respects with the applicable accounting requirements and with the published rules and regulations of the SEC with
respect thereto; (iii) have been prepared in accordance with GAAP, in all material respects, applied on a consistent basis during
the periods involved (except (A) as may be indicated in such financial statements or in the notes thereto and (B) in the case of
the unaudited interim statements of the Company, as may be permitted under Form 10-Q of the Exchange Act); and (iv) present fairly,
in all material respects, the financial position of the Company, and the results of operations and cash flows of the Company, as
of the times and for the periods referred to therein (except as may be indicated in the notes thereto and subject, in the case
of unaudited interim financial statements, to normal and recurring year-end adjustments and the absence of footnote disclosure,
none of which, individually or in the aggregate, will be material).
(b) Prior to the date of this Agreement, the Company has furnished to Parent complete and correct copies of all comment
letters from the SEC since January 1, 2016 through the date of this Agreement with respect to any of the Company SEC Documents,
together with all written responses of the Company thereto. As of the date of this Agreement, there are no outstanding or unresolved
comments in comment letters received from the SEC staff with respect to any of the Company SEC Documents, and, to the Knowledge
of the Company, none of the Company SEC Documents are subject to ongoing SEC review.
(c) The Company is in compliance in all material respects with the applicable provisions of the Sarbanes-Oxley Act and
the applicable listing and governance rules and regulations of the NYSE American.
(d) The Company maintains a system of internal control over financial reporting (as defined in Rules 13a-15(f) and 15d-15(f)
of the Exchange Act) designed to provide reasonable assurance regarding the reliability of the Company’s financial reporting
and the preparation of financial statements for external purposes in conformity with GAAP. The Company has evaluated the effectiveness
of the Company’s internal control over financial reporting and, to the extent required by applicable Law, presented in any
applicable Company SEC Document that is a report on Form 10-K or Form 10-Q or any amendment thereto its conclusions about the effectiveness
of the internal control over financial reporting as of the end of the period covered by such report or amendment based on such
evaluation. The Company has disclosed, based on the most recent evaluation of internal control over financial reporting prior to
the date of this Agreement, to the Company’s auditors and the audit committee of the Company Board (i) all “significant
deficiencies” and “material weaknesses” (as such terms are defined in Auditing Standard No. 5 of the Public Company
Accounting Oversight Board, as in effect on the date of this Agreement) in the design or operation of internal control over financial
reporting that are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial
information and (ii) any fraud, whether or not material, that involves the Company’s management or other employees who
have a significant role in the Company’s internal control over financial reporting. Except as described in the Company SEC
Reports, since January 1, 2016, the Company has not identified any material weaknesses in the design or operation of the Company’s
internal control over financial reporting.
(e) The Company maintains disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Exchange
Act) designed to ensure that all information required to be disclosed by the Company in the reports that it files or submits under
the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the rules and forms of the
SEC, and that all such information is accumulated and communicated to the Company’s management as appropriate to allow timely
decisions regarding required disclosure and to make the certifications of the chief executive officer and chief financial officer
of the Company required under the Exchange Act with respect to such reports.
(f) As of the date of this Agreement, there are no SEC Proceedings pending or, to the Knowledge of the Company, threatened,
in each case regarding any accounting practices of the Company or any of its Subsidiaries or any malfeasance by any director or
executive officer of the Company or any of its Subsidiaries. Since January 1, 2016 through the date of this Agreement, there have
been no investigations regarding accounting, auditing or revenue recognition discussed with, reviewed by or initiated at the direction
of the chief executive officer, chief financial officer, chief accounting officer or general counsel of the Company or any of its
Subsidiaries or the Company Board, any board of directors of any of its Subsidiaries or any committee of the Company Board or any
board of directors of any of its Subsidiaries.
(g) Each of the principal executive officer of the Company and the principal financial officer of the Company (or each
former principal executive officer of the Company and each former principal financial officer of the Company, as applicable) has
made all certifications required by Rule 13a-14 or 15d-14 under the Exchange Act and Sections 302 and 906 of the Sarbanes-Oxley
Act with respect to the Company SEC Documents, and the statements contained in such certifications are true and correct. For purposes
of this Agreement, “principal executive officer” and “principal financial officer” shall have the meanings
given to such terms in the Sarbanes-Oxley Act. The Company does not have, and has not arranged any, outstanding “extensions
of credit” to directors or executive officers within the meaning of Section 402 of the Sarbanes-Oxley Act.
(h) Since January 1, 2016, (i) neither the Company nor any of its Subsidiaries has received any written or, to the Knowledge
of the Company, oral complaint, allegation, assertion or claim regarding accounting, internal accounting controls, auditing practices,
procedures, methodologies or methods of the Company or any of its Subsidiaries, or unlawful accounting or auditing matters with
respect to the Company or any of its Subsidiaries and (ii) no attorney representing the Company or any of its Subsidiaries, whether
or not employed by the Company or any of its Subsidiaries, has reported evidence of a violation of securities Laws, breach of fiduciary
duty or similar violation by the Company or any of its Subsidiaries or any of their respective officers, directors, employees or
agents to the Company Board or any committee thereof or to the general counsel or chief executive officer of the Company pursuant
to the rules of the SEC adopted under Section 307 of the Sarbanes-Oxley Act.
(i) Neither the Company nor any of its Subsidiaries is a party to, or is subject to any commitment to become a party
to, any joint venture, off-balance sheet partnership or any similar Contract (including any Contract or arrangement relating to
any transaction or relationship between or among the Company and any of its Subsidiaries, on the one hand, and any unconsolidated
Affiliate, on the other hand), including any structured finance, special purpose or limited purpose entity or Person, or any “off-balance
sheet arrangements” (as defined in Item 303(a) of Regulation S-K under the Securities Act), in each case, where the result,
purpose or effect of such Contract is to avoid disclosure of any material transaction involving, or material liabilities of, the
Company or any of its Subsidiaries in the Company SEC Documents (including any audited financial statements and unaudited interim
financial statements of the Company included therein).
Section 3.7 Absence of Certain Changes or Events. Since December
31, 2018 through the date of this Agreement, (a) except for the negotiation, execution and delivery of this Agreement, the respective
businesses of the Company and its Subsidiaries have been conducted in the ordinary course of business consistent with past practice
in all material respects, (b) (i) the Company has not suffered a Company Material Adverse Effect and (ii) there has been no effect,
change, development, event, circumstance, occurrence, condition, fact or state of facts that would reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect and (c) neither the Company nor any of its Subsidiaries has
taken any action that, if taken after the date of this Agreement, would have constituted a breach of subsections (a), (b), (d),
(g), (h), (i), (j), (l), (m), (n), (p), (q), (u), (v), (w) or (x) of Section 5.1.
Section 3.8 No Undisclosed Liabilities. Except for liabilities
or obligations (a) reflected or reserved against in the Company’s consolidated balance sheet as of June 30, 2019 (or the
notes thereto), a copy of which was delivered to Parent on August 6, 2019; (b) incurred in connection with or contemplated
by this Agreement or the transactions contemplated by this Agreement; (c) incurred in the ordinary course of business since
June 30, 2019; (d) set forth in any Contract existing as of the date hereof, which are not required to be disclosed or provided
for in such consolidated balance sheet described in the foregoing clause (a), except to the extent such liabilities or obligations
resulted from a breach of such Contract; or (e) that have not had, and would not reasonably be expected to have, individually or
in the aggregate, a Company Material Adverse Effect, none of the Company or any of its Subsidiaries has any liabilities or obligations
of any nature, whether or not accrued, contingent, absolute or otherwise and whether or not required to be reflected on a consolidated
balance sheet of the Company (or the notes thereto) in accordance with GAAP.
Section 3.9 Litigation. As of the date of this Agreement, (a)
there is no Proceeding pending or, to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries or
any asset or property of the Company or any of its Subsidiaries, and (b) there is no Order outstanding against, or involving, the
Company or any of its Subsidiaries or any asset or property of the Company or any of its Subsidiaries that, in each case of clauses
(a) and (b), (i) has been, or would reasonably be expected to be, individually or in the aggregate, material to the Company and
its Subsidiaries, taken as a whole or (ii) would reasonably be expected to, individually or in the aggregate, impair in any material
respect the ability of the Company to perform its obligations under this Agreement or to consummate the Merger, or prevent or materially
delay the consummation of any of the Merger and the other transactions contemplated by this Agreement. As of the date of this Agreement,
except as has not had, or would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect (i) there is no Proceeding pending or, to the Knowledge of the Company, threatened against any officer or director of the
Company or any of its Subsidiaries, and (ii) there is no Order outstanding against, or involving, any officer or director of the
Company or any of its Subsidiaries. Since January 1, 2016, except as has not had, or would not reasonably be expected to have,
individually or in the aggregate, a Company Material Adverse Effect, there have not been any product liability, manufacturing or
design defect, warranty, field repair or other material product-related claims by any third Person (whether based on contract or
tort and whether relating to personal injury, including death, property damage or economic loss) arising from (A) services rendered
by the Company or any of its Subsidiaries or (B) the sale, distribution or manufacturing of products, including medical products
and devices, by the Company or any of its Subsidiaries that have been, or would reasonably be expected to be, individually or in
the aggregate, material to the Company and its Subsidiaries, taken as a whole. As of this date hereof, neither the Company nor
any of its Subsidiaries has any material Proceedings pending or threatened against any other Person. This Section 3.9 shall
not be construed as a representation with respect to Tax matters, which are the subject of Section 3.14.
Section 3.10 Permits; Compliance with Laws.
(a) The Company and its Subsidiaries are in possession of all franchises, grants, authorizations, licenses, permits,
easements, variances, exceptions, exemptions, consents, certificates, approvals, product listings, registrations, clearances, Orders
and other authorizations necessary for the Company and its Subsidiaries to own, lease and operate their respective properties and
assets pursuant to all applicable Laws as currently owned, leased and operated, or to carry on their respective businesses as now
being conducted under and pursuant to all applicable Laws (the “Company Permits”), (ii) all such Company Permits
are in full force and effect and (iii) as of the date of this Agreement, no suspension, cancellation, withdrawal or revocation
thereof is pending or, to the Knowledge of the Company, threatened, except in each of clauses (i) – (iii) where the failure
to be in possession of, failure to be in full force and effect or the suspension, cancellation, withdrawal or revocation thereof
(A) has not been, and would not reasonably be expected to be, individually or in the aggregate, material to the Company and its
Subsidiaries, taken as a whole and (B) would not reasonably be expected to, individually or in the aggregate, impair in any material
respect the ability of the Company to perform its obligations under this Agreement or to consummate the Merger, or prevent or materially
delay the consummation of any of the Merger and the other transactions contemplated by this Agreement.
(b) The Company and its Subsidiaries have been since January 1, 2016, and are in compliance with (i) all applicable Laws
and (ii) all Company Permits, except where any failure to be in such compliance (A) has not been, and would not reasonably be expected
to be, individually or in the aggregate, material to the Company and its Subsidiaries, taken as a whole and (B) would not reasonably
be expected to, individually or in the aggregate, impair in any material respect the ability of the Company to perform its obligations
under this Agreement or to consummate the Merger, or prevent or materially delay the consummation of any of the Merger and the
other transactions contemplated by this Agreement.
(c) Since January 1, 2016, none of the Company or any of its Subsidiaries or, to the Knowledge of the Company, any of
their respective directors or officers (only in their capacity as such directors or officers) has received any written or, to the
Knowledge of the Company, oral notification from a Governmental Authority asserting that the Company or any of its Subsidiaries,
or any officer or director of the Company or any of its Subsidiaries is under investigation for not being in compliance in all
material respects with any Laws or Company Permits.
Section 3.11 Proxy Statement. None of the information supplied
or to be supplied by or on behalf of the Company for inclusion or incorporation by reference in the proxy statement of the Company
(as amended or supplemented from time to time, the “Proxy Statement”) to be filed with the SEC for use in connection
with the solicitation of proxies from the stockholders of the Company in connection with the Merger and the Company Stockholders’
Meeting will contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading
at the time such Proxy Statement is first mailed to stockholders of the Company and at the time of the Company Stockholders’
Meeting. The Proxy Statement will comply as to form in all material respects with the requirements of the Exchange Act and the
rules and regulations promulgated thereunder. No representation or warranty is made by the Company with respect to statements made
or incorporated by reference in the Proxy Statement based on information supplied by Parent, Merger Sub or their respective Affiliates
for inclusion or incorporation by reference therein.
Section 3.12 Employee Benefit Plans.
(a) Section 3.12(a) of the Company Disclosure Letter contains a true, complete and correct list of all
material Benefit Plans. “Benefit Plan” shall mean (i) each “employee pension benefit plan” (as defined
in Section 3(2) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”)); (ii) each “employee
welfare benefit plan” (as defined in Section 3(1) of ERISA); and (iii) all other benefit plans, policies, programs, agreements
or arrangements, including any bonus, deferred compensation, severance pay, retention, change in control, employment, consulting,
pension, profit-sharing, retirement, insurance, stock purchase, stock option, incentive or equity compensation or other fringe
benefit plan, program, policy, agreement, arrangement or practice maintained, contributed to or required to be contributed to,
by the Company or any of its Subsidiaries, for the benefit of any current or former employees, officers or directors (or any beneficiary
or dependent thereof) of the Company or any Subsidiary. The Company has delivered or made available to Parent and Merger Sub true,
complete and correct copies of (A) each material Benefit Plan (including all amendments thereto) or written description of
each Benefit Plan that is not otherwise in writing; (B) the most recent annual reports on Form 5500 and all schedules thereto filed
with respect to each Benefit Plan, to the extent applicable; (C) the most recent summary plan description and summary of material
modifications for each Benefit Plan, to the extent applicable; (D) each current trust agreement, insurance contract or policy,
group annuity contract and any other funding arrangement relating to any Benefit Plan, to the extent applicable; (E) the most recent
actuarial report, financial statement or valuation report, to the extent applicable; (F) a current Internal Revenue Service opinion
or favorable determination letter, to the extent applicable; (G) all material non-routine correspondence to or from any Governmental
Authority relating to any Benefit Plan; and (H) all discrimination tests for each Benefit Plan for the most recent plan years,
to the extent applicable.
(b) Each Benefit Plan is and has at all times been operated and administered in all material respects in accordance with
its terms and in compliance in all material respects with applicable Law, including ERISA, the Code and the Patient Protection
and Affordable Care Act. All material claims incurred with a date of service on or before the Closing Date under any Benefit Plan
that is an “employee welfare benefit plan” as defined in Section 3(1) of ERISA that is self-insured will be paid by
the Company or accrued on the Company financial statements no later than the Closing Date.
(c) Each Benefit Plan intended to be “qualified” within the meaning of Section 401(a) of the Code has received
a recent and currently effective determination letter or can rely on an opinion letter for a prototype plan from the Internal Revenue
Service that such Benefit Plan is so qualified and exempt from taxation under Sections 401(a) and 501(a) of the Code, and, to the
Knowledge of the Company, no condition exists that would be expected to adversely affect such qualification.
(d) None of the Benefit Plans is, and none of the Company, its Subsidiaries or any ERISA Affiliate has ever maintained
or had an obligation to contribute to, (i) a “single employer plan” (as such term is defined in Section 4001(a)(15)
of ERISA) subject to Section 412 of the Code or Title IV of ERISA; (ii) a “multiple employer plan” or “multiple
employer welfare arrangement” (as such terms are defined in ERISA); (iii) a welfare benefit fund (as such term is defined
in Section 419 of the Code); (iv) a “multiemployer plan” (as such term is defined in Section 4001(a)(3) of ERISA);
or (v) a voluntary employees’ beneficiary association under Section 501(c)(9) of the Code. There are no material unpaid contributions
due prior to the date of this Agreement with respect to any Benefit Plan that are required to have been made under the terms of
such Benefit Plan, any related insurance contract or any applicable Law and all material contributions due have been timely made,
or to the extent not yet due, have been properly accrued on the applicable balance sheet in accordance with the terms of the applicable
Benefit Plan and applicable Law.
(e) None of the Company or any of its Subsidiaries has engaged in a non-exempt “prohibited transaction” (as
such term is defined in Section 406 of ERISA and Section 4975 of the Code) or breached any fiduciary duties with respect to any
Benefit Plan that reasonably would be expected to subject the Company, any of its Subsidiaries or the Surviving Corporation to
any material tax or penalty.
(f) With respect to any Benefit Plan, there is no Proceeding pending, or, to the Knowledge of the Company, threatened
or anticipated with or by the Internal Revenue Service, the United States Department of Labor or any other Governmental Authority,
other than routine claims for benefits, in each case, that would reasonably be expected to subject the Company, any of its Subsidiaries
or the Surviving Corporation to any material liability.
(g) Neither the Company nor any of its Subsidiaries has any obligations to provide any health or other welfare benefits
(whether or not insured) to retired or other former employees, directors or consultants, except as specifically required by Part
6 of Title I of ERISA (“COBRA”) or, pursuant to an applicable employment agreement or severance agreement, plan
or policy listed in Section 3.12(g) of the Company Disclosure Letter requiring the Company or any Subsidiary to pay
or subsidize COBRA premiums for a terminated employee following the employee’s termination.
(h) Each Benefit Plan that is a group health plan is being and has been operated and administered in material compliance
with the Patient Protection and Affordable Care Act (including the reporting requirements of Sections 6055 and 6056 of the Code).
None of the Company or its Subsidiaries has incurred or will incur any material liability under Sections 4980D and 4980H of the
Code and its governing regulations and no event has occurred and no circumstance exists or has existed that could reasonably be
expected to give rise to the incurrence of such material liability.
(i) Except as set forth on Section 3.12(i) of the Company Disclosure Letter, neither the execution and
delivery of this Agreement nor the consummation of the Merger or any of the other transactions contemplated hereby, or any termination
of employment or service (or other event or occurrence) in connection therewith will (i) entitle any current or former employee,
director or consultant of the Company or any of its Subsidiaries to any payment or benefit (or result in the funding of any such
payment or benefit) or result in any forgiveness of Indebtedness with respect to any such persons; (ii) increase the amount of
any compensation, equity award or other benefits otherwise payable by the Company or any of its Subsidiaries; or (iii) result in
the acceleration of the time of payment, funding or vesting of any compensation, equity award or other benefits except as required
under Section 411(d)(3) of the Code.
(j) Except as set forth on Section 3.12(j) of the Company Disclosure Letter, no amounts payable by the
Company or any of its Subsidiaries in connection with the transactions contemplated hereby will be an “excess parachute payment”
within the meaning of Section 280G of the Code. Neither the Company nor any of its Subsidiaries has any obligation to gross-up,
indemnify or otherwise reimburse any individual with respect to any Tax under Sections 409A or 4999 of the Code.
(k) To the extent applicable, each Benefit Plan has been maintained in documentary compliance with, and has been operated
and administered in material compliance with, Section 409A of the Code.
(l) None of the Company or any of its Subsidiaries has used the services or workers provided by third Person contract
labor suppliers, temporary employees, “leased employees” (as that term is defined in Section 414(n) of the Code), or
individuals who have provided services as independent contractors to an extent that would reasonably be expected to result in the
disqualification of any of the Benefit Plans or the imposition of material penalties or excise taxes with respect to the Benefit
Plans by the Internal Revenue Service, the United States Department of Labor or the Pension Benefit Guaranty Corporation, and no
such individuals are entitled to any benefits under any Benefit Plan that they have been improperly denied by reason of their misclassification
as independent contractors.
Section 3.13 Labor Matters.
(a) (i)
There is no labor strike, material dispute, organized slowdown, stoppage or lockout pending, or, to the Knowledge of the Company,
threatened against or affecting the Company or any of its Subsidiaries, nor has there been any such action or event since January
1, 2016; (ii) neither the Company nor any of its Subsidiaries is a party to, bound by or in the process of negotiating any labor,
collective bargaining, works council or similar agreement regarding the employees of the Company or any of its Subsidiaries (each,
a “Labor Agreement”); (iii) as of the date hereof, there are no unfair labor practice charges or material grievances
relating to any current or former employee or consultant of the Company or any of its Subsidiaries (relating to their services
for or relationship with the Company or its Subsidiaries); and (iv) as of the date hereof, none of the employees of the Company
or any of its Subsidiaries is represented by any labor union, works council, employee representative group or similar organization
(whether in or outside the United States) with respect to their employment with the Company or any of its Subsidiaries and, to
the Knowledge of the Company, there are not, as of the date hereof, any union organizing activities, either by or on behalf of
any employee or union or similar labor organization with respect to employees of the Company or any of its Subsidiaries. There
is no labor union, work council, employee representative group or similar organization which, pursuant to applicable Law or any
governing agreement, must be notified, consulted or with which negotiations need to be conducted in connection with the Merger.
(b) The Company and its Subsidiaries are, and since January 1, 2016, have been, in compliance, in all material respects,
with all applicable Laws relating to labor and employment matters, including fair employment practices, equal employment opportunity,
disability rights, affirmative action, terms and conditions of employment, consultation with employees, immigration and work authorization,
wages, hours (including, but not limited to, overtime and minimum wage requirements and child labor restrictions), social contributions
(including the payment and withholding of U.S. social security and similar Taxes), compensation, workers’ compensation, unemployment
insurance, classification of employees, workers and individual independent contractors, employee leaves of absence, data protection,
privacy, occupational safety and health, collective or mass layoffs and plant closings. Neither the Company nor any of its Subsidiaries
has taken any action within the past two (2) years requiring notice to employees or any other obligations under the Worker Adjustment
Retraining Notification Act of 1988, as amended (the “WARN Act”), unless the Company or any such Subsidiary
materially complied with the requirements of the WARN Act.
(c) To the Knowledge of the Company, no executive officer or employee at the level of Vice President (or any similarly-leveled
employee) or above of the Company or any of its Subsidiaries (i) is subject to any noncompete, nonsolicitation, nondisclosure,
confidentiality, employment, consulting or similar agreement with any other Person in conflict with the present and proposed business
activities of the Company and its Subsidiaries, except agreements between the Company or any Subsidiary of the Company; or (ii)
as of the date hereof, is in violation of any common law nondisclosure obligation or fiduciary duty relating to the ability of
such individual to work for the Company or any of its Subsidiaries.
(d) Since January 1, 2016, none of the Company or its Subsidiaries has entered into a settlement agreement with a current
or former officer or employee of the Company or its Subsidiaries that substantially involves allegations relating to sexual harassment.
Section 3.14 Taxes. Except as would not reasonably be expected
to have, individually or in the aggregate, a Company Material Adverse Effect:
(a) The Company and each of its Subsidiaries have (i) duly and timely filed or caused to be duly and timely filed (taking
into account any extension of time within which to file) all U.S. federal income and other Tax Returns required to be filed by
any of them and all such filed Tax Returns (taking into account all amendments thereto) are true, complete and accurate in all
respects and (ii) paid all Taxes due and owing (whether or not shown on such Tax Returns) except to the extent that such Taxes
are being contested in good faith and by appropriate proceedings and for which adequate reserves have been maintained in accordance
with GAAP.
(b) As of the date of this Agreement, there are no pending, ongoing or, to the Knowledge of the Company, threatened,
audits, examinations, investigations or other Proceedings by any Governmental Authority in respect of Taxes of the Company or any
of its Subsidiaries. No deficiencies for an amount of Taxes have been claimed, proposed, assessed or, to the Knowledge of the Company,
threatened, against the Company or any of its Subsidiaries by any Governmental Authority that have not been fully paid, settled
or withdrawn. None of the Company or any of its Subsidiaries has waived any statute of limitations with respect to Taxes or agreed
to any extension of time with respect to any Tax assessment, deficiency or collection, which waiver or extension currently remains
in effect. Neither the Company nor its Subsidiaries have received within the past five years a written claim from any Governmental
Authority in a jurisdiction where the Company or any of its Subsidiaries does not currently file a Tax Return that it is or may
be subject to taxation by that jurisdiction in respect of Taxes that would be covered by or the subject of such Tax Return, which
claim has not been resolved in full. No power of attorney that would be in force after the Closing Date has been granted by the
Company or any of its Subsidiaries with respect to Taxes.
(c) There are no Tax rulings, requests for Tax rulings, applications for change in accounting methods or closing agreements
with respect to Taxes, in each case with a Governmental Authority, that could reasonably be expected to affect liabilities for
Taxes of the Company or any of its Subsidiaries for any period after the Effective Time.
(d) None of the Company or any of its Subsidiaries will be required to include any item of income in, or exclude any
item of deduction from, taxable income for any taxable period (or portion thereof) beginning after the Closing Date as a result
of: (i) any installment sale or open transaction disposition made prior to the Effective Time; (ii) any prepaid amount received
on or prior to the Effective Time; (iii) Section 481(a) of the Code (or an analogous provision of state, local, or foreign Law)
by reason of a change in accounting method prior to the Effective Time; or (iv) any election under Section 108(i) of the Code.
To the Knowledge of the Company, none of the Company or any of its Subsidiaries has any excess loss account described in Treasury
Regulations under Section 1502 of the Code (or any corresponding provision of state, local or foreign Tax Law). None of the Company
or any of its Subsidiaries will be obligated to pay any Tax after the Effective Time as a result of an election to defer the payment
of Taxes under Section 965 pursuant to Section 965(h).
(e) All amounts of Taxes that the Company or any of its Subsidiaries is or was required by Law to withhold or collect
have been duly and timely withheld or collected and have been duly and timely paid to the proper Governmental Authority or other
proper Person or properly set aside in accounts for this purpose.
(f) None of the Company or any of its Subsidiaries has ever been a member of a consolidated, combined or unitary Tax
group (other than such a group the common parent of which is or was the Company or any of its Subsidiaries), and none of the Company
or any of its Subsidiaries has any liability for Taxes of any other Person (other than Taxes of the Company or any of its Subsidiaries)
under Section 1.1502-6 of the Treasury Regulations (or any similar provision of foreign, state or local Law) or as a transferee
or successor or, to the Knowledge of the Company, otherwise as a matter of Law.
(g) None of the Company or any of its Subsidiaries is a party to or is bound by any Tax sharing, Tax allocation or Tax
indemnification agreement or arrangement (other than such an agreement or arrangement exclusively between or among the Company
and its Subsidiaries or customary commercial Contracts, the principal subject matter of which is not Taxes) that will not be terminated
on or before the Closing Date without any future liability to the Company or any of its Subsidiaries.
(h) There are no Liens for Taxes on any of the assets of the Company or any of its Subsidiaries other than Liens for
Taxes that are not yet due and delinquent or that are being contested in good faith and by appropriate proceedings and for which
adequate reserves have been maintained in accordance with GAAP.
(i) None of the Company or any of its Subsidiaries has participated in or been a party to a transaction that, as of the
date of this Agreement, constitutes a “listed transaction” within the meaning of Section 6707A(c)(2) of the Code or
Section 1.6011-4(b) of the Treasury Regulations.
(j) Within the last two (2) years, none of the Company or any of its Subsidiaries has been a “distributing corporation”
or “controlled corporation” in any transaction intended to qualify for tax-free treatment under Section 355 of the
Code.
(k) The Company and each of its Subsidiaries are and have at all times been in compliance in all material respects with
the medical device excise tax provisions imposed by Section 4191 of the Code since the effective date of such provisions to the
extent applicable to their operations.
(l) The Company and each of its Subsidiaries are and have at all times been in compliance in all material respects with
all applicable transfer pricing laws and regulations. All related party transactions involving the Company or any of its Subsidiaries
are and have been at arm’s length in compliance with Section 482 of the Code, the Treasury Regulations promulgated thereunder,
and any similar provision of state, local or foreign Law.
(m)
None of the Company’s Subsidiaries that are classified as “controlled foreign corporations” as
defined in Section 957 of the Code has generated any “subpart F” income (within the meaning of Section 952 of the Code)
outside the ordinary course of business in 2017 or 2018.
Section 3.15 Material Contracts.
(a) Section 3.15(a) of the Company Disclosure Letter sets forth a complete and correct list, with items
arranged according to the relevant subsection of this Section 3.15, as of the date of this Agreement, of each Company Material
Contract. A complete and correct copy of each Company Material Contract has been made available to Parent, except to the extent
such Contract is publicly filed as an exhibit to the Company SEC Documents. For purposes of this Agreement, “Company Material
Contract” means any Contract to which the Company or any of its Subsidiaries is a party or to or by which any asset or
property of the Company or any of its Subsidiaries is bound, except for this Agreement, that:
(i)
except for purchase orders or invoices in the ordinary course of business, is a Contract with a supplier or customer involving
payments in excess of $100,000 in the twelve (12) months ended December 31, 2018 or reasonably expected to involve payments in
excess of $100,000 in the twelve (12) months ending December 31, 2019;
(ii)
constitutes a “material contract” (as such term is defined in Item 601(b)(10) of Regulation S-K under the Securities
Act);
(iii)
is a joint venture, alliance, partnership, collaboration, shareholder, material development Contract or similar Contract;
(iv)
is an agency, sales, marketing, commission, distribution, international or domestic sales representative or similar Contract;
(v)
is a Contract (other than those solely between or among the Company and any of its wholly owned Subsidiaries) relating to Indebtedness
of the Company or any of its Subsidiaries (whether outstanding or as may be incurred thereunder);
(vi)
is a Contract (other than those solely between or among the Company and any of its wholly owned Subsidiaries) relating to Indebtedness
of a third Person having a principal amount reasonably expected to be in excess of $100,000 owed to the Company or any of its Subsidiaries;
(vii)
is a Contract that contains any payment obligations that are outside the ordinary course of business and are off-balance sheet
arrangements;
(viii)
is a Contract that creates or would create a Lien (other than a Permitted Lien) on any asset of the Company or any of its Subsidiaries,
or restricts the payment of dividends;
(ix)
is a Contract representing Company Warrants or that relates to ongoing obligations in connection with Company Warrants;
(x)
is a Demand Registration Rights Agreement;
(xi)
is a Contract that obligates the Company or any of its Subsidiaries to conduct any business on an exclusive basis with any third
Person, or upon consummation of the Merger, will obligate Parent or any of its Subsidiaries to conduct business with any such third
Person on an exclusive basis, or is a non-competition or non-solicitation Contract or any other Contract (including a Contract
related to the sale of products or the provision of services by the Company or any of its Subsidiaries) that limits, restricts
or prohibits, or purports to limit, restrict or prohibit, (A) the manner or the localities in which any business of the Company
and its Subsidiaries is or could be conducted or (B) the lines or types of businesses that the Company or any of its Subsidiaries
conducts or has a right to conduct (each a “Restrictive Business Arrangement”);
(xii)
is a Contract with any Governmental Authority;
(xiii)
is a Contract relating to the acquisition or disposition of any Person, business or operations or assets constituting a business
(whether by merger, sale of stock, sale of assets, consolidation or otherwise) entered into since January 1, 2016 (including any
such Contract under which contemplated transactions were consummated) under which one or more of the parties thereto has material
obligations remaining to be performed;
(xiv)
is an Intellectual Property Agreement;
(xv)
is a Contract that imposes any co-promotion or collaboration obligations with respect to any product or product candidate, which
obligations are material to the Company and its Subsidiaries, taken as a whole;
(xvi) is a hedging, derivative or similar Contract (including interest rate, currency or commodity swap agreements, cap agreements, collar
agreements and any similar Contract designed to protect a Person against fluctuations in interest rates, currency exchange rates
or commodity prices);
(xvii)
is a service or supply Contract, including a “single, sole source” supply Contract, pursuant to which goods or materials
in excess of $100,000 for the rolling twelve (12) month period beginning on the date hereof are expected to be supplied to the
Company or any of its Subsidiaries from an exclusive source;
(xviii)
is a Labor Agreement;
(xix)
is a Contract which provides for a loan or advance of any amount to any employee of the Company or any temporary agency employee,
consultant or other independent contractor of the Company or any of its Subsidiaries, other than in the ordinary course of business;
or
(xx)
is a Contract, under which the Company or any of its Subsidiaries is, or may become, obligated to sell or otherwise issue any shares
of its capital stock or any other Securities.
(b) None of the Company or any of its Subsidiaries is in material breach of or default (or, with the giving of notice
or lapse of time or both, would be in default) under the terms of, and has not taken any action resulting in the termination of,
the acceleration of performance required by, or a right of termination or acceleration under, any Company Material Contract to
which it is a party. As of the date of this Agreement, to the Knowledge of the Company, no other party to any Company Material
Contract is in material breach of or default (or, with the giving of notice or lapse of time or both, would be in default) under
the terms of, and has not taken any action resulting in the termination of, the acceleration of performance required by, or a right
of termination or acceleration under, any Company Material Contract. Each Company Material Contract is (i) a valid and binding
obligation of the Company or any of its Subsidiaries that are a party thereto, as applicable, and, to the Knowledge of the Company,
the other parties thereto (provided, however, that such enforcement may be subject to the Enforceability Exceptions)
and (ii) in full force and effect, except in the case of clauses (i) and (ii), to the extent any such Company Material Contract
expires by its terms or is terminated in accordance with its terms in the ordinary course of business in compliance with Section
5.1 and except as would not reasonably be expected to be material to the business of the Company and its Subsidiaries, taken
as a whole.
(c) No (i) current or former officer or director of the Company; (ii) beneficial owner of five percent (5%) or more of
any voting Securities of the Company; or (iii) any “affiliate” or “associate” of any such Person, has any
interest in any Contract or property (real or personal, tangible or intangible), used in, or pertaining to the business of the
Company or any of its Subsidiaries, which interest would be required to be disclosed pursuant to Item 404(a) of Regulation S-K
under the Securities Act and that has not been so disclosed in the Company SEC Documents.
Section 3.16 Intellectual Property.
(a) Section 3.16(a) of the Company Disclosure Letter sets forth a true, complete and correct list, as of
the date of this Agreement, of all Company Registered IP. For each item of Company Registered IP, Section 3.16(a) of the
Company Disclosure Letter lists the owner, country(ies) or region, and registration and application numbers.
(b) The Company or one or more of its Subsidiaries owns, or has a valid right to use, all Intellectual Property used
in the conduct of the Company’s and its Subsidiaries’ respective businesses as such businesses are conducted as of
the Closing and as such businesses are intended to be conducted after the Closing. The Surviving Corporation will own or possess
sufficient rights to all Intellectual Property as of the Closing that are necessary to the operation of the Company’s and
its Subsidiaries’ respective businesses, as conducted as of immediately prior to the Closing.
(c) With respect to Company Owned IP, (i) the Company or one of its Subsidiaries is the sole and exclusive owner of each
item free and clear of all Liens other than Permitted Liens and (ii) the Company and its Subsidiaries have taken commercially reasonable
actions to maintain each item. With respect to Company Registered IP, each item is registered in the name of the Company or one
or more of its Subsidiaries.
(d) Section 3.16(d) of the Company Disclosure Letter sets forth a true, complete and correct list, as of
the date of this Agreement, of all Contracts pursuant to which the Company or one or more of its Subsidiaries receives a license
or otherwise obtains a right to use any of the Company Licensed IP, other than commercially available, non-customized, off-the-shelf
software subject to “shrink-wrap” or “click-through” type terms and available to the Company or any of
its Subsidiaries, as applicable. The rights, licenses and interests of the Company or any of its Subsidiaries in and to all Company
Licensed IP are free and clear of all Liens or similar restrictions that restrict the use of the Company Licensed IP or the operation
of the Company’s and its Subsidiaries’ respective businesses, other than Permitted Liens and restrictions contained
in the applicable Contracts with the licensor of such Company Licensed IP, as set forth in Section 3.16(d) of the Company
Disclosure Letter.
(e) To the Knowledge of the Company, none of the activities or business currently conducted by the Company or any of
its Subsidiaries at any time since January 1, 2017 infringes, misappropriates or otherwise violates any valid and enforceable Intellectual
Property of any third Person. Neither the Company nor any of its Subsidiaries is subject to any Order that materially restricts
or impairs the use of any Company Intellectual Property.
(f) There is not now and has not been since January 1, 2016 a pending or threatened claim or Proceeding by any Person
asserting the alleged infringement, misappropriation or violation of any Intellectual Property of any Person by the Company or
any of its Subsidiaries, or contesting the validity, ownership, enforceability or right of the Company or any of its Subsidiaries
in or to any of the Company Owned IP, including in the nature of being offered a license or covenant not to sue, and to the Knowledge
of the Company, there is no basis for any such Proceeding with respect to any Intellectual Property of any Person. Since January
1, 2016, neither the Company nor any of its Subsidiaries has received any written notice of any conflict or pending conflict with,
or infringement, misappropriation or violation of, the rights of any Person with respect to any Intellectual Property or any license
to any Intellectual Property, or challenging the validity, ownership, enforceability, or right of the Company or any of its Subsidiaries
to use any Intellectual Property.
(g) There is not now and has not been since January 1, 2016 a pending or threatened claim or Proceeding by the Company
or any of its Subsidiaries asserting the alleged infringement, misappropriation or violation of any Company Intellectual Property
by any Person, or contesting the validity, ownership, enforceability or right of any Person in or to any Intellectual Property,
including in the nature of offering a license or covenant not to sue, and to the Knowledge of the Company, there is no basis for
any such Proceeding with respect to any Company Intellectual Property. Since January 1, 2014, neither the Company nor any of its
Subsidiaries has asserted rights in any of the Company Intellectual Property against any Person in any Proceeding, cease and desist
letter, or other written notice, including in the nature of offering a license or covenant not to sue.
(h) The Company and each of its Subsidiaries have taken reasonable measures to protect and preserve the confidentiality
of all material confidential information and all Trade Secrets that are Company Owned IP, or any Trade Secrets disclosed to the
Company or its Subsidiaries for which the Company or any of its Subsidiaries had or has an obligation of secrecy, against unauthorized
access, disclosure, use, modification or other misuse. To the Knowledge of the Company, there has been no material unauthorized
access, disclosure or use of any material Trade Secrets that are Company Owned IP, or any Trade Secrets disclosed to the Company
or its Subsidiaries for which the Company or any of its Subsidiaries had or has an obligation of secrecy, against unauthorized
access, disclosure, use, modification or other misuse.
(i) Except as would not, individually or in the aggregate, be material to the business of the Company and its Subsidiaries,
the Company and each of its Subsidiaries have used reasonable measures to protect the Trade Secrets included in the Company Intellectual
Property and have secured from all of their employees and consultants who independently or jointly contributed to the conception,
reduction to practice, creation or development of any Company Owned IP unencumbered and unrestricted exclusive ownership of all
such employee’s or consultant’s, as applicable, Intellectual Property in such contribution that the Company or any
of its Subsidiaries do not already own by operation of Law and such employee or consultant, as applicable, has not retained any
rights or licenses with respect thereto. Without limiting the foregoing, except as would not, individually or in the aggregate,
be material to the business of the Company and its Subsidiaries, the Company and its Subsidiaries have obtained proprietary information
and assignment Contracts from all current and former employees, consultants, contractors, and other Persons involved in the development
of any Intellectual Property with or for the Company or any of its Subsidiaries, and those Contracts assign and require assignment
to the Company or one or more of its Subsidiaries all right, title and interest in and to Intellectual Property developed by such
employees, consultants, contractors, and other Persons.
(j) There are no settlements, forbearances to sue, consents, Orders or similar obligations to which the Company or any
of its Subsidiaries is a party or is subject that (i) restrict the Company’s or any of its Subsidiaries’ rights to
use, enjoy or exploit any material Company Intellectual Property; (ii) materially restrict the Company’s or any of its Subsidiaries’
business in order to accommodate any Person’s right in or to any Intellectual Property; or (iii) permit any Person to use
any Company Intellectual Property.
(k) Except as set forth on Section 3.16(k) of the Company Disclosure Letter, neither the Company nor any
of its Subsidiaries has entered into any contractual obligation requiring it to indemnify any other Person against infringement
or other violation of any Intellectual Property of any Person, nor has the Company or any of its Subsidiaries entered into any
contractual obligation requiring the Company or one of its Subsidiaries to grant any Person the right to bring infringement actions
or otherwise enforce rights with respect to any of the Company Owned IP.
(l) To the Knowledge of the Company, since January 1, 2016, no current or former employee or consultant of the Company
or any of its Subsidiaries (i) is in violation of any (A) term or covenant of any contractual or other obligation to the Company
or any of its Subsidiaries relating to invention disclosure, invention assignment, non-disclosure, limitation of use, or non-competition,
or (B) any applicable material non-disclosure obligation or restrictive covenant obligation for the benefit of any other Person,
including any former employer of such employee or consultant, by virtue of such employee or consultant being employed by or performing
services for the Company or any of its Subsidiaries, or using Trade Secrets or proprietary information of such Person, including
any former employer, for the benefit of the Company or any of its Subsidiaries, or (ii) has developed any technology, Software
or other copyrightable, patentable or otherwise proprietary work for the Company or any of its Subsidiaries that is subject to
any agreement under which such employee or consultant has assigned or otherwise granted to any Person any rights other than the
Company (including rights in or to Intellectual Property) in or to such technology, Software or other copyrightable, patentable
or otherwise proprietary work or which has been subject to any confidentiality or use restrictions. To the Knowledge of the Company,
all disclosures by the Company or any of its Subsidiaries to any Person of material Company-owned confidential information and
Trade Secrets, or confidential information and Trade Secrets as to which the Company or any of its Subsidiaries had or has an obligation
of secrecy, have been made pursuant to the terms of a written contractual obligation between the Company or its applicable Subsidiaries
and such third Person requiring that such third Person not disclose or otherwise use such confidential information or Trade Secrets
for any purpose other than those expressly authorized in writing by the Company or any of its Subsidiaries, as applicable.
(m)
With regard to proprietary Software that is developed or used by the Company or any of its Subsidiaries, or is currently
in development by the Company or any of its Subsidiaries, and other than as has not been, and would not reasonably be expected
to be, individually or in the aggregate, material to the business of the Company and its Subsidiaries, taken as a whole: (i) neither
the Company nor any of its Subsidiaries has assigned, delivered, licensed or made available, and does not have any obligation to
assign, deliver, license or make available, the source code for any such Software to any third Person, including any escrow agent
or similar Person; (ii) neither the Company nor any of its Subsidiaries has experienced any material defects or disruptions in
such Software, including any material error or omission in the processing of any transactions that have not been corrected; (iii)
no such Software (A) contains any code designed or intended to disrupt, disable, harm or otherwise impede in any manner the operation
of, or provide unauthorized access to, a computer system or network or other device on which such code is stored or installed,
or to damage or destroy data or files without the user’s consent, or (B) incorporates, embeds or is distributed or installed
with, statically or dynamically links with, or otherwise interacts with any Software that is distributed as free software, open
source software, or pursuant to similar licensing or distribution models, including pursuant to any GNU general public license
or limited general public license, in a manner that would require any Software included in the Company Owned IP, including any
source code associated with such Software, to be disclosed, licensed, or divulged to any other Person; (iv) current copies of the
source code for all such material Software are recorded on machine readable media, clearly identified and securely stored (together
with the applicable documentation) by the Company or any of its Subsidiaries; and (v) no capital expenditures are necessary with
respect to such Software or its use.
(n) No
item of Company Owned IP has been held to be invalid or unenforceable in any Order. The Company Owned IP (and, to the Knowledge
of the Company, the Company Licensed IP) is subsisting (or in the case of applications, applied for) and to the Knowledge of the
Company, valid and enforceable. No issued Patents or pending patent applications included in the Company Owned IP are subject
to any interference, reissue, reexamination, opposition, inter partes review, covered business method review, post-grant
review, or other post-grant proceeding. No Trademark that is included in the Company Owned IP is subject to any opposition, invalidation,
cancellation, or other administrative proceeding. Neither the Company nor any of its Subsidiaries is undertaking any interference,
reissue, reexamination, opposition, inter partes review, covered business method review, post-grant review, invalidation,
cancellation, or other administrative proceeding with respect to Intellectual Property of any Person. The Company and its Subsidiaries
have not knowingly made any material misrepresentations in the filings submitted to the applicable Governmental Authorities with
respect to any Company Registered IP and, to the Knowledge of the Company, neither the Company nor any of its Subsidiaries has
engaged in misuse, including patent or copyright misuse or any fraud or inequitable conduct, in connection with any Company Owned
IP.
(o) No Company Intellectual Property is being used or enforced by the Company or any of its Subsidiaries in a manner
that would reasonably be expected to result in the abandonment, cancellation or unenforceability of any Intellectual Property used
in and necessary for or otherwise material to the conduct of the Company’s and any of its Subsidiaries’ businesses
as currently conducted.
(p) Except as set forth on Section 3.16(p) of the Company Disclosure Letter, no Governmental Authority,
in the United States or any other jurisdiction, has acquired or has a right to acquire, including upon the occurrence of any pending
conditions, any right, title, or interest in or to any of the Company Owned IP, including any “limited rights” or “restricted
rights” as defined in the Federal Acquisition Regulations and related agency supplements, including the Defense Federal Acquisition
Regulation Supplement.
(q) The
Company and each of its Subsidiaries have at all times been and are in compliance in all material respects with (i) all Laws or
Orders applicable to the Company and each of its Subsidiaries that govern or regulate the privacy, security, processing, protection,
destruction, breach notification, or transfer of or with respect to individually identifiable information, including the Health
Insurance Portability and Accountability Act (HIPAA), the EU General Data Protection Regulation (GDPR), and similar international,
foreign, national, state and local data protection Laws and the regulations that implement the foregoing, as may be amended from
time to time (collectively, “Data Protection Laws”), and (ii) all contractual commitments made by it with respect
to the privacy or security of Personal Information (collectively, (i) and (ii), the “Privacy Requirements”).
No claims are pending or have been threatened in writing or, to the Knowledge of the Company, threatened other than in writing,
against the Company or any of its Subsidiaries alleging any violation of the Privacy Requirements or any violation of any Person’s
privacy, personal information, or data rights.
(r) During the three (3) years prior to the date hereof, (i) there have been no material security breaches in the Company’s
or any of its Subsidiaries’ information technology systems, (ii) to the Knowledge of the Company, there have been no material
security breaches in the information technology systems used in the operation of the products or services provided or rendered
by the Company or any of its Subsidiaries, and (iii) there have been no disruptions in information technology systems that materially
adversely affected the Company’s or any of its Subsidiaries’ business or operations. The Company has used commercially
reasonable efforts to evaluate the disaster recovery and backup needs of the Company and its Subsidiaries and has implemented plans
and systems that are reasonably designed to address its assessment risk. The Company and each of its Subsidiaries: (A) have implemented,
maintains, and complies with written privacy and security policies with respect to any Personal Information processed by it or
on its behalf; (B) employ reasonable and appropriate safeguards sufficient to protect all Personal Information that is processed
by it or on its behalf from loss, misappropriation, or unauthorized or unlawful use, disclosure, access, or other processing; (C)
have provided any notice, and obtained any consent, required by any Privacy Requirement for any collection, use, disclosure, cross-border
transfer, retention, or other processing of Personal Information by it or on its behalf; and (D) have entered into an agreement
with each service provider or other Person that processes Personal Information for it or on its behalf, which agreement complies
with applicable Privacy Requirements. There has been no unauthorized access, loss, use, or disclosure of any Personal Information
in the possession or under the control of the Company or any of its Subsidiaries in violation of any Privacy Requirement. Neither
the Company nor any of its Subsidiaries has notified, nor has the Company or any Company Subsidiary been required to notify (whether
pursuant to applicable Law or otherwise), any Person of any information security breach or incident involving Personal Information.
Section 3.17 Real and Personal Property.
(a) The Company and its Subsidiaries do not own any real property.
(b)
Section 3.17(b) of the Company Disclosure Letter sets forth a complete and accurate list as of the
date of this Agreement of each lease, sublease, license or similar use and occupancy Contract (including any assignments, amendments,
extensions and modifications thereto, each, a “Lease”) pursuant to which the Company or any of its Subsidiaries
leases, subleases or otherwise uses or occupies, as applicable, any real or personal property from any other Person (whether as
a tenant, subtenant or pursuant to other occupancy arrangements) (collectively, the “Company Leased Property”).
The Company has made available to Parent a true, correct and complete copy of each such Lease to date.
(c)
Except as set forth on Section 3.17(c) of the Company Disclosure Letter, (i) the Company and its Subsidiaries
have valid leasehold interests under each of the Leases, free and clear of all Liens, except for Permitted Liens and (ii) the Company
and its Subsidiaries enjoy peaceful and undisturbed possession under all of the Leases for any Company Leased Property.
(d)
Each Lease for any Company Leased Property is in full force and effect and is a valid and binding obligation of the
Company or any of its Subsidiaries that is a party thereto, as applicable, and to the Knowledge of the Company, the other parties
thereto.
(e)
No event has occurred and no condition exists, which with the giving of notice or the passage of time, or both, will
constitute a default under a Lease by the Company or any of its Subsidiaries, or, to the Knowledge of the Company, any counterparty
under such Lease, that would, individually or in the aggregate, materially impair or be reasonably likely to materially impair
the continued use and operations of the Company Leased Property to which they relate in the conduct of the business of the Company
and its Subsidiaries as presently conducted.
(f)
(i) no Person, other than the Company or a Subsidiary of the Company, possesses, uses or occupies, as applicable,
all or any portion of any Company Leased Property and (ii) neither the Company nor any Subsidiary of the Company is a party to
any agreement, right of first offer, right of first refusal or option with respect to the purchase or sale of any real property
or interest therein. As of the date hereof, there are no pending or, to the Knowledge of the Company, threatened Proceedings to
take all or any portion of the Company Leased Property or any interest therein by eminent domain or any condemnation proceeding
(or the jurisdictional equivalent thereof) or any sale or disposition in lieu thereof.
Section 3.18
Environmental.
(a)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company
Material Adverse Effect:
(i) since
January 1, 2016, the Company and its Subsidiaries have been and are in compliance with all applicable Environmental Laws, including
possessing and complying with the terms of all Company Permits required for their operations as currently conducted under applicable
Environmental Laws;
(ii) (A)
there is no pending or, to the Knowledge of the Company, threatened Proceeding pursuant to any Environmental Law against the Company
or any of its Subsidiaries; (B) none of the Company or any of its Subsidiaries has received notice or a request for information
from any Person, including any Governmental Authority, alleging that the Company or any of its Subsidiaries has been or is in actual
or potential violation of any applicable Environmental Law or otherwise may be liable under any applicable Environmental Law, which
violation or liability is unresolved; and (C) none of the Company or any of its Subsidiaries is a party or subject to any Order
pursuant to Environmental Law that is currently in effect;
(iii) there
have been no Releases of Hazardous Materials by the Company or any of its Subsidiaries (and, to Knowledge of the Company, Releases
of Hazardous Materials have not otherwise occurred) at, on, under or from any location that have resulted in or are reasonably
likely to result in an obligation by the Company or any of its Subsidiaries to remediate such Releases pursuant to applicable Environmental
Law or otherwise have resulted in or are reasonably likely to result in liability to the Company or any of its Subsidiaries pursuant
to applicable Environmental Law with respect to such Releases; and
(iv) neither
the Company nor any of its Subsidiaries has entered into any written agreement or incurred any legal obligation that would reasonably
be expected to require it to pay to, reimburse, or indemnify any other Person from or against liabilities or costs arising in connection
with or pursuant to Environmental Law, or relating to impacts on human health or the environment arising from the generation, manufacture,
use, transportation or disposal of or exposure to Hazardous Materials.
(b)
The Company has delivered or otherwise made available for inspection to the Parent copies of any reports, investigations,
audits, assessments (including Phase I or II environmental assessments), studies or other material documents in the possession
of or reasonably available to the Company or any of its Subsidiaries pertaining to: (i) any unresolved claims arising under or
relating to any Environmental Law; or (ii) any Hazardous Materials in, on, beneath or adjacent to any property currently or formerly
owned, operated or leased by the Company or any of its Subsidiaries.
Section 3.19 Customers, Distributors, and Suppliers. Section
3.19 of the Company Disclosure Letter sets forth (a) the ten (10) largest customers (by revenue) of the businesses of
the Company and its Subsidiaries (on a consolidated basis) during the twelve months ended December 31, 2018; (b) the ten (10) largest
distributors or sales agents (by revenue) of the businesses of the Company and its Subsidiaries (on a consolidated basis) during
the twelve months ended December 31, 2018; (c) (i) “single, sole source” suppliers, (ii) each supplier that together
with other suppliers ranked by purchasing volume represent 80% of the total purchasing volume of the Company and its Subsidiaries
(on a consolidated basis) during the twelve months ended December 31, 2018, (iii) each supplier where the purchasing volume of
the Company or its Subsidiaries, as applicable, to the Knowledge of the Company, is greater than 50% of such supplier’s total
sales volume (on a consolidated basis, if applicable) during the twelve months ended December 31, 2018, (iv) each supplier that,
to the Knowledge of the Company, owns or uses unique or specialized technologies or procedures for the production, handling or
service of the products delivered or services provided by the Company or any of its Subsidiaries, and (v) to the Knowledge of the
Company, any other supplier of the businesses of the Company and its Subsidiaries, the loss of which is expected to cause material
disruption to such businesses (on a consolidated basis) (each supplier set forth in (i) – (v), a “Material Supplier”);
and (d) each distributor, sales agent, and supplier of the businesses of the Company and each of its Subsidiaries with whom the
Company or any of its Subsidiaries is obligated by Contract to conduct any business on an exclusive basis, or upon consummation
of the Merger, with whom Parent or any of its Subsidiaries will be obligated to conduct business on an exclusive basis. Section
3.19(d) of the Company Disclosure Letter lists, for each distributor, sales agent, and supplier disclosed pursuant to
clause (d) of this Section 3.19, (i) the applicable product(s), geographic territory(ies), and customer(s) subject to the
exclusivity arrangement; and (ii) whether the exclusivity arrangement provides the distributor, sales agent, or supplier, as applicable,
any exclusive right to market, promote, sell, distribute the Company’s or any of its Subsidiary’s products or services.
Since January 1, 2019, through the date of this Agreement, no customer, supplier, distributor, or sales agent, as applicable, listed
on Section 3.19 of the Company Disclosure Letter has canceled or otherwise terminated, or to the Knowledge of the
Company, threatened to cancel or otherwise terminate, its relationship with the Company or any of its Subsidiaries, or has decreased
materially, or to the Knowledge of the Company, threatened to decrease materially, the quantity of products or services purchased
from or sold to, as the case may be, the businesses of the Company or any of its Subsidiaries. Section 3.19 of the Company
Disclosure Letter also sets forth (i) customers, suppliers, distributors, or sales agents, as applicable, that had entered
into a Contract with the Company or any of its Subsidiaries, which expired, lapsed or was terminated, and with whom the Company
or any of its Subsidiaries continues to do business as of the date hereof, and (ii) the terms of such continued business arrangements.
Section 3.20 Product Warranty. Each product manufactured, sold,
leased, delivered or distributed (including the featured and functionality offered thereby) or service provided or rendered by
the Company or any of its Subsidiaries complies in all material respects with all applicable contractual specifications, requirements
and covenants and all express and implied warranties made by the Company or any of its Subsidiaries and is not subject to any term,
condition, guaranty, warranty or other indemnity beyond the applicable standard terms and conditions for such product or service.
Section 3.20 of the Company Disclosure Letter sets forth any material claims for replacement, repair or other damages
in connection with the Company’s or any of its Subsidiaries’ material products or services since January 1, 2019.
Section 3.21 Foreign Corrupt Practices Act; Anti-Corruption.
(a) Since
January 1, 2016, none of the Company, any of its Subsidiaries or any of their respective officers, directors, employees or, to
the Knowledge of the Company, agents, distributors, consultants or independent contractors (to the extent acting on behalf of
the Company or any of its Subsidiaries) has directly or indirectly made, promised, or authorized or offered to make, promise or
authorize any contribution, gift, bribe, rebate, payoff, influence payment, kickback, or other payment or thing of value to any
Person, private or public, regardless of what form, whether in money, property or services, in violation of, to the extent applicable,
the FCPA, the U.S. Travel Act, the U.K. Bribery Act 2010, applicable Laws implementing the OECD Convention on Combating Bribery
of Foreign Public Officials in International Business Transactions or any other applicable Law, rule or regulation relating to
anti-corruption or anti-bribery in any jurisdiction where the Company operates (collectively, the “Anti-Corruption Laws”).
Without limiting the foregoing, since January 1, 2016, none of the Company, any of its Subsidiaries, or any of their respective
officers, directors, employees or, to the Knowledge of the Company, agents, distributors, consultants or independent contractors
(to the extent acting on behalf of the Company or any of its Subsidiaries) has directly or indirectly offered or given anything
of value corruptly to (i) any official, political party or official thereof or any candidate for political office or (ii) any
Person, while knowing that all or a portion of such thing of value will be offered, given or promised, directly or indirectly,
to any official, to any political party or official thereof or to any candidate for political office for the purpose of the following:
(A) influencing any act or decision of such official, political party, party official or candidate in his, her or its official
capacity, including influencing such official, political party, party official or candidate to do or omit to do any act in violation
of his, her or its lawful duty, or securing any improper advantage for the benefit of the Company or any of its Subsidiaries or
(B) inducing such official, political party, party official or candidate to use his, her or its influence with a Governmental
Authority or instrumentality thereof to affect or influence any act or decision of such Governmental Authority or instrumentality,
in order to assist the Company or any of its Subsidiaries in obtaining or retaining business for or with, or directing business
to, any Person or securing an improper advantage for the benefit of the Company or any of its Subsidiaries.
(b)
Since January 1, 2016, neither the Company, nor any of its Subsidiaries, nor, to the Knowledge of the Company, any
of the Company’s or its Subsidiaries’ respective agents, distributors, consultants or independent contractors (to the
extent acting on behalf of the Company or any of its Subsidiaries) (i) is or has been the subject of an unresolved claim or allegation
relating to (A) any potential violation of the Anti-Corruption Laws or (B) any potentially unlawful contribution, gift, bribe,
rebate, payoff, influence payment, kickback or other payment or the provision of anything of value, directly or indirectly, to
an official, to any political party or official thereof or to any candidate for political office, or (ii) has received any notice
or other communication (in writing) from, or made a voluntary disclosure to, any Governmental Authority regarding any actual, alleged
or potential violation of, or failure to comply with, any Anti-Corruption Laws.
(c)
The Company and its Subsidiaries maintain a system or systems of internal controls that are reasonable and customary
for companies similarly situated as the Company to (i) ensure compliance with Anti-Corruption Laws and (ii) prevent and detect
violations of Anti-Corruption Laws.
Section 3.22
Customs and International Trade Laws.
(a)
Since January 1, 2017, the Company and its Subsidiaries have been in compliance in all material respects with all
applicable Customs & International Trade Laws and there are no unresolved formal claims concerning the liability of any of
the Company or its Subsidiaries under such Laws. Without limiting the foregoing, (i) at all times since January 1, 2017, the Company
and its Subsidiaries and, to the Knowledge of the Company, Persons acting on their behalf have obtained all import and export licenses
and all other consents, notices, waivers, approvals, Orders, authorizations, registrations, declarations, classifications and filings
required for the export, import, re-export or transfer of goods, services, software and technology required for the operation of
the respective businesses of the Company and its Subsidiaries, including Customs & International Trade Authorizations; (ii)
since January 1, 2017, no Governmental Authority has initiated any Proceedings or imposed any civil or criminal fine, penalty,
seizure, forfeiture, revocation of a Customs & International Trade Authorization, debarment or denial of future Customs &
International Trade Authorizations against any of the Company or its Subsidiaries or any of their respective directors, officers,
employees or agents in connection with any actual or alleged violation of any applicable Customs & International Trade Laws;
and (iii) since January 1, 2017, there have been no claims, investigations or requests for information by a Governmental Authority
with respect to the Company’s and its Subsidiaries’ Customs & International Trade Authorizations and compliance
with applicable Customs & International Trade Laws.
(b)
Neither the Company nor any of its Subsidiaries, and no director, officer or employee of any of the Company or its
Subsidiaries, (i) is a Sanctioned Person; or (ii) has pending or, to the Knowledge of the Company, threatened claims against it
with respect to Sanctions.
Section 3.23
FDA and Related Matters.
(a)
Section 3.23(a) of the Company Disclosure Letter lists all Registrations held by the Company and each
of its Subsidiaries. Since January 1, 2016, the Company and its Subsidiaries possess all Registrations required to conduct their
respective businesses as currently conducted. Each such Registration is valid and subsisting in full force and effect. To the Knowledge
of the Company, as of the date hereof, neither the United States Food and Drug Administration (the “FDA”) nor
any comparable Regulatory Authority or Governmental Authority is considering limiting, suspending or revoking any such Registration
or changing the marketing classification or labeling of the products of the Company and any of its Subsidiaries. To the Knowledge
of the Company, there is no material false or misleading information or material omission in any product application or other submission
to the FDA or any comparable Regulatory Authority or Governmental Authority. Since January 1, 2016, the Company and each of its
Subsidiaries are in material compliance with, and have fulfilled and performed in all material respects their respective obligations
under, each such Registration (including applicable European legislation (e.g. Directive 93/42/EEC (MDD), Directive 2011/65/EU
(RoHS), Regulation 1907/2006/EC (REACH))), and, as of the date hereof, to the Knowledge of the Company, no event has occurred or
condition or state of facts exists which would constitute a breach or default or would cause revocation or termination of any such
Registration. Further, the Company has implemented all necessary steps needed to secure the enduring marketability of its products
under Regulation (EU) 2017/745 (MDR, application date May 26, 2020) or Regulation (EU) 2017/746 (IVDR, application date May 26,
2022). To the Knowledge of the Company, any third Person that is a manufacturer or contractor for the Company or any of its Subsidiaries
is in material compliance with all Registrations insofar as they pertain to the manufacture of product components or products for
the Company or any of its Subsidiaries, as applicable.
(b)
Since January 1, 2016, all products and services developed, tested, investigated, produced, manufactured, labeled,
promoted, distributed, marketed, stored, sold, imported, exported or used by or on behalf of the Company or any of its Subsidiaries
that are subject to the jurisdiction of the FDA or any comparable Regulatory Authority have been and are being developed, tested,
investigated, produced, manufactured, labeled, promoted, distributed, marketed, stored, sold, imported and exported, supervised
and maintained as applicable, in all material respects, in compliance with Device Laws, and any comparable Laws enforced by any
other Regulatory Authority that has jurisdiction over the operations of the Company or any of its Subsidiaries, including those
regarding non-clinical research, clinical research, establishment registration, device listing, pre-market notification, good manufacturing
practices, labeling, advertising, record-keeping, device importation and exportation, security, cybersecurity, adverse event reporting
and reporting of corrections and removals. To the Knowledge of the Company, except as would not be material to the Company and
its Subsidiaries, taken as a whole, since January 1, 2016, any third Person that is a manufacturer or contractor for the Company
or any of its Subsidiaries is in material compliance with all Device Laws or any other applicable Law insofar as they pertain to
the manufacture, promotion, marketing, sale, or maintenance of product components or products for the Company or any of its Subsidiaries.
(c)
As of the date hereof, there are no Proceedings pending or, to the Knowledge of the Company, threatened by or on
behalf of any Regulatory Authority that has jurisdiction over the operations of the Company and any of its Subsidiaries. Since
January 1, 2016, neither the Company nor any of its Subsidiaries, nor, to the Knowledge of the Company its contractors providing
services by or on behalf of the Company or its Subsidiaries, has received any Form FDA-483, notice of adverse finding, FDA warning
letter, notice of violation or “untitled letter,” notice of FDA action for import detention or refusal, or any other
notice from the FDA or any other Governmental Authority alleging or asserting noncompliance with any applicable Laws or Registrations.
Neither the Company nor any of its Subsidiaries is subject to any obligation arising under an administrative or regulatory action,
FDA inspection, FDA warning letter, FDA notice of violation letter or other notice, response or commitment made to or with the
FDA or any comparable Regulatory Authority. Since January 1, 2016, each of the Company and its Subsidiaries has made all notifications,
submissions, responses and reports required by Device Laws, including any such obligation arising under any administrative or regulatory
action, FDA inspection, FDA warning letter, FDA notice of violation letter, or other notice, response, or commitment made to or
with the FDA or any comparable Regulatory Authority or Governmental Authority and, to the Knowledge of the Company, all such notifications,
submissions, responses and reports were true, complete and correct in all material respects as of the date of submission to the
FDA or any comparable Regulatory Authority or Governmental Authority. To the Knowledge of the Company, as of the date hereof, no
basis for material liability exists with respect to regulatory requirements concerning notifications, submissions and reports.
(d)
Since January 1, 2016, no product distributed or sold by or on behalf of the Company or any of its Subsidiaries has
been seized, withdrawn, recalled, detained or subject to a suspension of manufacturing, and as of the date hereof, to the Knowledge
of the Company, there are no facts or circumstances reasonably likely to cause (i) the seizure, denial, withdrawal, recall, detention,
field notification, field correction, safety alert or suspension of manufacturing relating to any such product; (ii) a change in
the labeling of any such product; or (iii) a termination, seizure, limitation, restriction, modification or suspension of the marketing
or distribution (including for commercial, investigational or any other use) of any such product. As of the date hereof, no Proceedings
in the United States or any other jurisdiction seeking the withdrawal, recall, correction, suspension, import detention, seizure
or similar action of any such product are pending or, to the Knowledge of the Company, threatened against the Company or any of
its Subsidiaries. Since January 1, 2016, neither the Company nor any of its Subsidiaries has received any written or, to the Knowledge
of the Company, verbal notice from a Regulatory Authority or other Governmental Authority that any product distributed or sold
by or on behalf of the Company or any of its Subsidiaries cannot be developed, tested, investigated, produced, manufactured, labeled,
promoted, distributed, marketed, stored, sold, imported or exported substantially in the manner presently performed or contemplated
by or on behalf of the Company.
(e)
Since January 1, 2016, all preclinical and clinical investigations sponsored or conducted by or on behalf of the
Company or any of its Subsidiaries (including post-marketing studies) have been and are being conducted in material compliance
with all applicable Laws and other requirements, including Good Clinical Practices requirements, other Device Laws, applicable
research protocols, corrective action plans, and Data Protection Laws. No clinical trial sponsored or conducted by or on behalf
of the Company or any of its Subsidiaries has been terminated, materially delayed, limited or suspended prior to completion by
the FDA, any other applicable Regulatory Authority, or any institutional review board that has or has had jurisdiction over such
clinical trial, and neither the FDA nor any other applicable Regulatory Authority, nor any institutional review board that has
or has had jurisdiction over a clinical trial conducted or sponsored by or on behalf of the Company or any of its Subsidiaries,
has ordered or commenced, or, to the Knowledge of the Company, threatened to initiate, any action to place a clinical hold order
on, or otherwise terminate, materially delay, limit, modify or suspend, any proposed or ongoing clinical trial conducted or proposed
to be conducted by or on behalf of the Company or any of its Subsidiaries, or, to the Knowledge of the Company, alleged any violation
of any Device Law in connection with any such clinical trial.
Section 3.24
Healthcare Regulatory Compliance.
(a)
Neither the Company nor any of its Subsidiaries or any of its or their respective officers, directors, managing employees
(as such terms are defined in 42 C.F.R. § 1001.2), nor to the Knowledge of the Company, any agent (as such term is defined
in 42 C.F.R. § 1001.2) of the Company or any of its Subsidiaries, is a party to, or bound by, any Order, individual integrity
agreement, corporate integrity agreement or other formal or informal agreement with any Governmental Authority concerning compliance
with Federal Health Care Program Laws.
(b)
Neither the Company nor any of its Subsidiaries nor any of its or their respective officers, directors, managing
employees (as those terms are defined in 42 C.F.R. § 1001.2), nor to the Knowledge of the Company, any agent (as such term
is defined in 42 C.F.R. § 1001.2) of the Company or any of its Subsidiaries (i) has been charged with or convicted of any
criminal offense relating to the delivery of an item or service under any Federal Health Care Program; (ii) has been debarred,
excluded or suspended from participation in any Federal Health Care Program; (iii) has had a civil monetary penalty assessed against
it, him or her under Section 1128A of the Social Security Act of 1935, codified at Title 42, Chapter 7, of the United States Code
(the “SSA”); (iv) is currently listed on the U.S. General Services Administration published list of parties
excluded from federal procurement programs and non-procurement programs; or (v) to the Knowledge of the Company is the target or
subject of any current or potential investigation relating to any Federal Health Care Program-related offense. “Federal
Health Care Program” has the meaning specified in Section 1128B(f) of the SSA and includes the Medicare, Medicaid and
TRICARE programs.
(c)
Neither the Company nor any of its Subsidiaries nor any of its or their respective officers, directors, managing
employees (as those terms are defined in 42 C.F.R. § 1001.2), nor to the Knowledge of the Company, any agent (as such term
is defined in 42 C.F.R. § 1001.2) of the Company or any of its Subsidiaries has engaged in any activity that is in violation
of, or is cause for civil or criminal penalties, mandatory or permissive exclusion from a Federal Health Care Program or other
administrative sanction under, the federal Medicare or federal or state Medicaid statutes, Section 1128, 1128A, 1128B, 1128C or
1877 of the SSA (42 U.S.C. §§ 1320a-7, 1320a-7a, 1320a-7b, 1320a-7c and 1395nn), the federal TRICARE statute (10 U.S.C.
§ 1071 et seq.), the civil False Claims Act of 1863 (31 U.S.C. § 3729 et seq.), criminal false claims statutes (e.g.,
18 U.S.C. §§ 287 and 1001), the Program Fraud Civil Remedies Act of 1986 (31 U.S.C. § 3801 et seq.), the anti-fraud
and related provisions of the Health Insurance Portability and Accountability Act of 1996 (“HIPAA”) (e.g., 18
U.S.C. §§ 1035 and 1347), the Physician Payment Sunshine Act (42 U.S.C. § 1320a-7h), or related regulations, or
any other Laws that govern the health care industry or relationships among health care providers, suppliers, distributors, manufacturers
and patients, including all state laws analogous to the foregoing (collectively, “Federal Health Care Program Laws”).
(d)
To the Knowledge of the Company, no Person has filed or has threatened to file against the Company or any of its
Subsidiaries an action relating to any Device Law or Federal Health Care Program Law under any federal or state whistleblower statute,
including under the False Claims Act of 1863 (31 U.S.C. § 3729 et seq.).
(e)
Neither the Company nor any of its Subsidiaries is a “covered entity” as that term is defined in HIPAA,
has entered into a business associate contract where required by 45 C.F.R. § 164.504(e), and is not in breach of any such
business associate contract.
(f)
To the extent the Company and any of its Subsidiaries provide to customers or others reimbursement coding or billing
advice regarding products offered for sale or the provision of services by the Company or any of its Subsidiaries and procedures
related thereto, such advice is (i) true, complete and correct; and (ii) in material compliance with all Federal Health Care Program
Laws.
(g)
The Company has adopted a code of ethics and has an operational healthcare compliance program consistent in all material
respects with the Compliance Program Guidance published by the Office of Inspector General, U.S. Department of Health and Human
Services, which governs all employees, including sales representatives and their interactions with their physician and hospital
customers.
(h)
Except as has not been, and would not reasonably be expected to be, individually or in the aggregate, material to
the Company and its Subsidiaries, taken as a whole, (i) all agreements or other arrangements between the Company or any of its
Subsidiaries on the one hand and any physician on the other hand for services are in writing, describe bona fide services required
by the Company or its Subsidiaries, as the case may be, provide for compensation that is no more than fair market value for such
services determined as of the effective date of such agreement, and are in material compliance with the Federal Anti-Kickback Statute
(42 U.S.C. § 1320a-7b(b)) (“AKS”); (ii) all agreements or arrangements with health care professionals for
services to or investments in the Company or any of its Subsidiaries, directly or indirectly, to which the Company or any of its
Subsidiaries is a party as of the date of this Agreement are listed on Section 3.24(h) of the Company Disclosure Letter,
including true, complete and correct details as to amounts paid thereunder in 2019; (iii) all payments made and things of value
provided by the Company or any of its Subsidiaries to any health care professional for services rendered by such health care professional
have been made at fair market value determined as of the effective date of any such agreement and are in material compliance with
the AKS; and (iv) all such agreements, arrangements, payments and things of value are in material compliance with all applicable
Laws, including all Federal Health Care Program Laws.
(i)
The Company has timely, accurately, and completely reported all payments and transfers of value made to physicians
and teaching hospitals, as required by the Physician Payment Sunshine Act (42 U.S.C. § 1320a-7h); and the Company is in material
compliance with all analogous state laws requiring the reporting of financial interactions with health care providers.
Section 3.25
Insurance. Section 3.25 of the Company
Disclosure Letter lists all insurance policies maintained by or on behalf of the Company or any of its Subsidiaries as of the
date of this Agreement. The Company and each of its Subsidiaries have paid, or caused to be paid, all premiums due under all such
insurance policies of the Company and each of its Subsidiaries, and all such insurance policies are, as of the date of this Agreement,
in full force and effect. As of the date of this Agreement, since January 1, 2016, none of the Company or any of its Subsidiaries
has received (i) notice that they are in default with respect to any obligations under such insurance policies or (ii) notice of
cancellation or termination with respect to any such existing insurance policy.
Section 3.26 Takeover Statutes. Assuming the accuracy of the representations
contained in Section 4.9, the Company Board has taken such actions and votes as are necessary to render the provisions of
any “fair price,” “moratorium,” “control share acquisition” or any other takeover or anti-takeover
statute or similar federal or state Law (including Section 203 of the DGCL) inapplicable to this Agreement, the Voting and Support
Agreement, the Merger or any other transactions contemplated by this Agreement.
Section 3.27 Brokers. No investment banker, broker, finder or
other intermediary (other than Citigroup Global Markets Inc., the fees and expenses of which will be paid by the Company) is entitled
to any investment banking, brokerage, finder’s or similar fee or commission in connection with this Agreement or the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of the Company or any of its Affiliates. True, correct
and complete copies of all agreements between the Company and Citigroup Global Markets Inc. have been delivered to Parent.
Section 3.28 Opinion of Financial Advisors. The Company Board
has received the opinion of Citigroup Global Markets Inc., as to the fairness of the Merger Consideration, from a financial point
of view, to the holders of Company Common Stock (other than Parent and Merger Sub or any of their Affiliates). A true, correct
and complete copy of the written opinion described above has been or will be delivered or made available to Parent promptly after
delivery thereof, it being understood and agreed that such opinion is for the sole benefit of the Company Board and may not be
relied upon by Parent or Merger Sub.
Section 3.29
No Other Representations or Warranties. Except for
the representations and warranties expressly made by the Company in this Article III, neither the Company nor any other
Person makes any representations or warranties on behalf of the Company with respect to the Company or any of its Subsidiaries.
The Company acknowledges and agrees that except for the representations and warranties expressly set forth in Article IV,
(A) none of Parent, Merger Sub or any of their respective Subsidiaries makes, or has made, any representations or warranties relating
to itself or its business or otherwise in connection with the Merger and the Company is not relying on any representation or warranty
except for those expressly set forth in Article IV and (B) no Person other than Parent and Merger Sub has been authorized
by Parent, Merger Sub or any of their respective Subsidiaries, as applicable, to make any representation or warranty relating to
Parent, Merger Sub or any of their respective Subsidiaries or the business of any of Parent, Merger Sub or any of their respective
Subsidiaries or otherwise in connection with the Merger, and if made, such representation or warranty must not be relied upon by
the Company as having been authorized by such party.
ARTICLE
IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB
Parent and Merger Sub
hereby, jointly and severally, represent and warrant to the Company as follows:
Section 4.1
Organization; Qualification. Each of Parent and Merger
Sub is (a) a corporation duly organized and validly existing under the laws of the jurisdiction of its respective incorporation
and has the requisite corporate power and authority to conduct its business as it is now being conducted and to own, lease and
operate its properties and assets in the manner in which its properties and assets are currently operated and (b) duly qualified
or licensed to do business and is in good standing in each jurisdiction in which the character or location of the property owned,
leased or operated by it or the nature of the business conducted by it makes such qualification or licensing necessary, except
where the failure to be so duly qualified or licensed and in good standing would not reasonably be expected to, individually or
in the aggregate, impair in any material respect the ability of Parent or Merger Sub, as the case may be, to perform its obligations
under this Agreement or to consummate the Merger and pay the Aggregate Merger Consideration and other amounts required to be paid
by Parent and Merger Sub hereunder, or otherwise prevent, materially delay or materially impair the consummation of the Merger
and the other transactions contemplated by this Agreement (a “Parent Material Adverse Effect”).
Section 4.2
Authority Relative to Agreement. Each of Parent and
Merger Sub has all necessary corporate power and authority to execute, deliver and perform their respective obligations under this
Agreement and to consummate the transactions contemplated by this Agreement. The execution, delivery and performance of this Agreement
by Parent and Merger Sub, and the consummation by Parent and Merger Sub of the transactions contemplated by this Agreement, have
been duly and validly authorized by all necessary corporate action by Parent and Merger Sub, and (in the case of the Merger, except
for the filing of the Certificate of Merger with the Delaware Secretary of State), no other corporate action or proceeding on the
part of Parent or Merger Sub is necessary to authorize the execution, delivery and performance of this Agreement by Parent and
Merger Sub and the consummation by Parent and Merger Sub of the transactions contemplated by this Agreement. This Agreement has
been duly executed and delivered by Parent and Merger Sub and, assuming due authorization, execution and delivery of this Agreement
by the Company, constitutes a legal, valid and binding obligation of each of Parent and Merger Sub, enforceable against each of
Parent and Merger Sub in accordance with its terms, subject to the Enforceability Exceptions.
Section 4.3
No Conflict; Required Filings and Consents.
(a)
Neither the execution and delivery of this Agreement by Parent and Merger Sub nor the consummation by Parent and
Merger Sub of the transactions contemplated by this Agreement, nor compliance by Parent and Merger Sub with any of the terms or
provisions of this Agreement, will (i) violate any provision of the Parent Organizational Documents, (ii) assuming that
the Consents, registrations, declarations, filings and notices referenced in Section 4.3(b) have been obtained or made,
conflict with or violate any Law applicable to Parent or Merger Sub or by which any property or asset of Parent or Merger Sub is
bound or affected; or (iii) violate, conflict with or result in any breach of any provision of, or loss of any benefit, or
constitute a default (with or without notice or lapse of time, or both) under, give rise to any right of termination, acceleration
or cancellation of or require the Consent of, notice to or filing with any third Person pursuant to any of the terms or provisions
of any material Contract to which Parent or Merger Sub is a party or by which any property or asset of Parent or Merger Sub is
bound, or result in the creation of a material Lien, other than any Permitted Lien, upon any of the property or assets of Parent
or Merger Sub, other than, in the case of clauses (ii) and (iii), as would not reasonably be expected to have, individually
or in the aggregate, a Parent Material Adverse Effect.
(b)
No Consent of, registration, submission, declaration or filing with or notice to any Governmental Authority is required
to be obtained or made by or with respect to Parent or Merger Sub in connection with the execution, delivery and performance of
this Agreement or the consummation of the transactions contemplated by this Agreement, other than (i) the filing and recordation
of the Certificate of Merger with the Delaware Secretary of State, (ii) such filings and approvals as may be required by any federal
or state securities Laws, including compliance with any applicable requirements of the Exchange Act, (iii) Consents required under,
and compliance with any applicable requirements of the HSR Act and the Antitrust Laws and rules and regulations of other applicable
Governmental Authorities, and (iv) such other Consents, registrations, declarations, filings or notices the failure of which to
be obtained or made would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 4.4
Litigation. As of the date of this Agreement, (a) there
is no Proceeding pending or, to the knowledge of Parent, threatened against Parent or any of its Subsidiaries or any asset or property
of Parent or any of its Subsidiaries, and (b) there is no Order outstanding against, or involving, Parent or any of its Subsidiaries
or any asset or property of Parent or any of its Subsidiaries that, in each case of clauses (a) and (b), would reasonably
be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Section 4.5
Information Supplied. None of the information with
respect to Parent and its Subsidiaries that is or will be furnished to the Company by or on behalf of Parent in writing specifically
for inclusion in the Proxy Statement will contain any untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements made therein, in the light of the circumstances under which they
were made, not misleading at the time such Proxy Statement or any amendment or supplement thereto is first mailed to the stockholders
of the Company and at the time of the Company Stockholders’ Meeting.
Section 4.6
Brokers. No investment banker, broker, finder or
other intermediary (except for UBS Europe SE, the fees and expenses of which will be paid by Parent or its Affiliate) is entitled
to any investment banking, brokerage, finder’s or similar fee or commission in connection with this Agreement or the transactions
contemplated by this Agreement based upon arrangements made by or on behalf of Parent or Merger Sub or any of their Affiliates.
Section 4.7
Sufficient Funds. Parent or Siemens Healthineers
AG (“Siemens Healthineers”) has available, and will continue to have available through and at the Closing, unencumbered
cash or cash equivalents, lines of credit or other sources of immediately available funds that are sufficient to permit Parent
to fund the Aggregate Merger Consideration contemplated by Article II and any other amounts payable by Parent, Merger Sub,
the Surviving Corporation or any of their respective Subsidiaries in connection with this Agreement and the transactions contemplated
hereby. The obligations of Parent and Merger Sub hereunder are not subject to any condition regarding Parent’s or Merger
Sub’s ability to obtain financing for the Merger and the other transactions contemplated by this Agreement. As of the date
of this Agreement there is no Law, Order or obligation (contractual or otherwise) in effect which would prevent or materially restrict,
delay or otherwise limit (or would have the effect of preventing or materially restricting, delaying or otherwise limiting) Parent’s
ability to fund the Aggregate Merger Consideration contemplated by Article II and any other amounts payable by Parent, Merger Sub,
the Surviving Corporation or any of their respective Subsidiaries in connection with this Agreement and the transactions contemplated
hereby.
Section 4.8
Merger Sub. All of the issued and outstanding capital
stock of Merger Sub is, and at the Effective Time will be, owned by Parent or a wholly owned Subsidiary of Parent. Merger Sub has
no outstanding options, warrants, rights or any other agreements pursuant to which any Person other than Parent may acquire any
Security of Merger Sub. Merger Sub has not engaged in any business activities or conducted any operations and has no, and prior
to the Effective Time will have no, assets, liabilities or obligations of any nature other than pursuant to the Merger and the
other transactions contemplated by this Agreement.
Section 4.9
No Interested Stockholder. Neither Parent nor any
of its Subsidiaries nor any “affiliate” or “associate” (as each such term is defined in Section 203
of the DGCL) of Parent or any of its Subsidiaries, is, or has been at any time during the period commencing three (3) years prior
to the date hereof through the date hereof, an “interested stockholder” (as such term is defined in Section 203
of the DGCL) of the Company. None of Parent, Merger Sub or any of their controlled Affiliates directly or indirectly beneficially
owns any Company Stock or other Securities convertible into, exchange into or exercisable for shares of Company Stock.
Section 4.10
No Vote of Parent Shareholders. Except for the adoption
of the Agreement by Parent as the sole shareholder of Merger Sub, no vote of the shareholders of Parent or the holders of any other
securities of Parent (equity or otherwise), is required by any applicable Law, the Parent Organizational Documents (or similar
organizational documents) or the applicable rules of any exchange on which securities of Parent are traded, in order for Parent
to consummate the transactions contemplated by this Agreement.
Section 4.11
No Other Representations or Warranties. Except for
the representations and warranties made by Parent and Merger Sub in this Article IV, none of Parent, Merger Sub or any other
Person makes any representations or warranties on behalf of Parent or Merger Sub with respect to Parent or any of its Subsidiaries.
Parent and Merger Sub each acknowledges and agrees that except for the representations and warranties expressly set forth in Article
III, (a) neither the Company nor any of its Subsidiaries makes, or has made, any representations or warranties relating
to itself or its business or otherwise in connection with the Merger and Parent and Merger Sub are not relying on any representation
or warranty except for those expressly set forth in Article III; (b) no Person other than the Company has been authorized
by the Company or any of its Subsidiaries, as applicable, to make any representation or warranty relating to the Company or any
of its Subsidiaries or the business of the Company or any of its Subsidiaries or otherwise in connection with the Merger, and if
made, such representation or warranty must not be relied upon by Parent or Merger Sub as having been authorized by such party;
and (c) except to the extent the subject of any representation or warranty expressly set forth in Article III, any
estimates, projections, predictions, data, financial information, memoranda, presentations or any other materials or information
provided to Parent, Merger Sub or any of their representatives whether orally or in writing are not, and shall not be deemed to
be or include, representations or warranties. Each of Parent and Merger Sub acknowledges and agrees that it (i) has had an opportunity
to discuss the business of the Company and its Subsidiaries with the management of the Company; (ii) has had reasonable access
to (A) the books and records of the Company and its Subsidiaries and (B) the electronic dataroom maintained by the Company for
purposes of the transactions contemplated by this Agreement; (iii) has been afforded the opportunity to ask questions of and receive
answers from officers of the Company; and (iv) has conducted its own independent investigation of the Company and its Subsidiaries,
their respective businesses and the transactions contemplated by this Agreement, and has not relied on any representation, warranty
or other statement by any Person on behalf of the Company or any of its Subsidiaries, other than the representations and warranties
of the Company expressly contained in Article III and that all other representations and warranties are specifically disclaimed.
ARTICLE
V
COVENANTS AND AGREEMENTS
Section 5.1
Conduct of Business by the Company Pending the
Merger. The Company covenants and agrees that, between the date of this Agreement and the earlier of the Effective
Time and the date, if any, on which this Agreement is terminated in accordance with Section 7.1, except (1) as
required by applicable Law, (2) as may be consented to in writing by Parent (provided that such consent shall not be
unreasonably withheld, delayed or conditioned), (3) as may be expressly required pursuant to this Agreement; (4) as required
by the terms of any Company Material Contract set forth on Section 3.15 of the Company Disclosure Letter as in
effect on the date of this Agreement or (5) as set forth on Section 5.1 of the Company Disclosure Letter, (x)
the Company shall, and shall cause each of its Subsidiaries to, conduct the business of the Company and its Subsidiaries in
all material respects in the ordinary course of business and in a manner consistent with past practice and, to the extent
consistent therewith, use commercially reasonable efforts to preserve its assets and business organization intact in all
material respects and maintain its existing business relations and goodwill with customers, suppliers, licensors,
distributors, Governmental Authorities, employees and business partners, in each case whose business relationships are
material to the Company and its Subsidiaries, taken as a whole (provided that, with respect to clause (x), no action or
failure to take action with respect to matters specifically addressed by any of the provisions of clause (y) shall constitute
a breach of clause (x) unless such action or failure to take action would constitute a breach of such applicable provision of
clause (y)), and (y) without limiting the generality of clause (x), the Company shall not, and shall cause each of its
Subsidiaries not to, directly or indirectly:
(a)
amend the Certificate of Incorporation or the Bylaws (or such similar organizational or governing documents of any
Subsidiary of the Company);
(b)
adjust, split, reverse split, combine, subdivide, reclassify, redeem, purchase, repurchase or otherwise acquire,
directly or indirectly, or amend the terms of, the Company’s or any of its Subsidiaries’ Securities, including any
options, equity or equity-based compensation, warrants, convertible Securities or other rights of any kind to acquire any of such
Securities, except as may be required pursuant to the terms of Company Preferred Stock or Company Warrants, as permitted by Section
5.1(c) or Section 5.1(d), or for any acquisitions or deemed acquisitions of any equity Securities of the Company in
connection with the forfeiture of, or the withholding of Taxes in connection with the exercise, vesting or settlement of, any Company
Equity Award or Company Warrant;
(c)
issue, sell, pledge, modify, transfer, dispose of, encumber or grant, or authorize the same with respect to, directly
or indirectly, any of the Company’s or any of its Subsidiaries’ Securities, including any options, equity or equity-based
compensation, warrants, convertible Securities or other rights of any kind to acquire such Securities; provided, however,
that the Company may issue shares of Company Common Stock (i) upon the exercise of Company Options or vesting of Company RSU Awards
outstanding as of the date of this Agreement (or permitted to be granted pursuant to this Agreement after the date hereof as set
forth on Section 5.1(c) of the Company Disclosure Letter) in accordance with the respective terms of such Company
Options or Company RSU Awards, (ii) upon the conversion of Company Preferred Stock in accordance with the terms of the Company
Certificate of Designation, and (iii) upon the exercise of Company Warrants outstanding as of the date of this Agreement in accordance
with their respective terms;
(d)
except (i) for cash dividends by direct or indirect wholly owned Subsidiaries of the Company to its respective parent
and (ii) ordinary course accretion with respect to the Company Preferred Stock in accordance with the Certificate of Designation,
declare, set aside, authorize, make or pay any dividend or other distribution payable in cash, stock, property or otherwise with
respect to the Company’s or any of its Subsidiaries’ Securities;
(e)
except as required by the terms of a Benefit Plan in existence as of the date of this Agreement, (i) establish, adopt,
enter into, materially amend or terminate any Benefit Plan, or any plan, program, policy, practice, agreement or other arrangement
that would be a Benefit Plan if it had been in existence on the date of this Agreement (other than as expressly permitted by Section
5.1(e)(iv)); (ii) grant or pay, or commit to grant or pay, any bonus, incentive or profit-sharing award or payment, or increase
the base salary or cash bonus opportunity to any director, officer, employee, or consultant of the Company or any Subsidiary, except
in the case of increases in annual base salaries for employees below the rank or title of vice president, at times and in dollar
amounts in the ordinary course of business in connection with the Company’s annual salary review process consistent with
past practice; (iii) accelerate or take any action to accelerate any payment or benefit, or the funding of any payment or benefit,
payable or to become payable to any current or former director, officer, employee, or consultant of the Company or any Subsidiary;
(iv) enter into, extend, amend or modify, or terminate any employment, severance, termination, change in control, retention, individual
consulting or other similar agreement with any current or former director, officer, employee, or consultant of, or individual service
provider to, the Company or any of its Subsidiaries (other than offer letters that provide for at-will employment without any severance,
retention or change in control benefits for newly hired employees or individual service providers who are hired in the ordinary
course of business and consistent with past practice and whose annual base compensation does not exceed $200,000 individually (or
$250,000 individually, in the case of sales representatives)); (v) communicate with the employees of the Company or any of its
Subsidiaries regarding the compensation or benefits they will receive following the Effective Time, unless such communication is
(A) approved by Parent in advance of such communication or (B) required by applicable Law; or (vi) except as may be required by
GAAP, materially change any actuarial or other assumptions used to calculate funding obligations with respect to any Benefit Plan
or materially change the manner in which contributions to such plans are made or the basis on which such contributions are determined;
(f)
hire, promote or terminate the employment of (other than for cause, death or disability) any employee with annual
base compensation above $200,000 (or $250,000, in the case of sales representatives);
(g)
take any action requiring notice to employees, or triggering any other obligations, under the WARN Act or any similar
state, local or foreign Law prior to the Closing;
(h)
waive, release or limit any restrictive covenant of any current or former employee or independent contractor of the
Company or any Subsidiary;
(i)
make any loan or advance to (other than travel and similar advances to its employees in the ordinary course of business
and consistent with past practice), or capital contribution to, or investment (other than purchases of inventory or supplies in
the ordinary course of business consistent with past practice or capital expenditures permitted pursuant to Section 5.1(r))
in, any Person (other than direct or indirect wholly owned Subsidiaries of the Company) in excess of $200,000 in the aggregate;
(j)
forgive any loans or advances to any officers, employees or directors of the Company or its Subsidiaries, or any
of their respective Affiliates, or change its existing borrowing or lending arrangements for or on behalf of any of such Persons
pursuant to an employee benefit plan or otherwise, except in the ordinary course of business in connection with relocation activities
to any employees of the Company or its Subsidiaries;
(k)
acquire (including by merger, consolidation, acquisition of stock or assets or otherwise) any corporation, partnership,
limited liability company, joint venture, other business organization, any division of any of the foregoing, any equity interest
in any of the foregoing, or all or any material portion of the assets, business or properties of any Person (excluding ordinary
course purchases consistent with past practice of inventory, surgical instruments, and supplies);
(l)
(i) sell, pledge, dispose of, transfer, abandon, lease (as lessor), license (except in accordance with Section
5.1(o)), mortgage, incur any Lien (other than Permitted Liens) (including pursuant to a sale-leaseback transaction or an asset
securitization transaction) on or otherwise transfer or encumber any portion of the tangible or intangible (other than Intellectual
Property, which is addressed in Section 5.2(u)) on material assets, business, or real property of the Company or any of
its Subsidiaries except (A) in connection with services provided in the ordinary course of business and consistent with past practice,
(B) sales of product inventory in the ordinary course of business and consistent with past practice, (C) for sales of obsolete
assets, (D) for transactions solely among the Company and one or more of its direct or indirect wholly owned Subsidiaries or solely
among such Subsidiaries of the Company, (E) for sales, leases or other dispositions of assets with a fair market value in an mount
not to exceed $100,000 in the aggregate, or (ii) enter into any new line of business that is material to the business of the Company
and its Subsidiaries, taken as a whole;
(m)
(i) except as expressly required pursuant to the terms thereof, pay, discharge or satisfy any Indebtedness that has
a prepayment cost, “make whole” amount, prepayment penalty or similar obligation (other than Indebtedness incurred
by the Company or its wholly owned Subsidiaries and solely owed to the Company or its wholly owned Subsidiaries) or (ii) cancel
any material Indebtedness (individually or in the aggregate) or settle, waive or amend any material claims or rights of substantial
value;
(n)
(i) incur, create, assume or otherwise become liable or responsible for any Indebtedness other than Indebtedness
incurred by the Company or its direct or indirect wholly owned Subsidiaries in the ordinary course of business consistent with
past practice or (ii) issue or sell any debt securities of the Company or any of its Subsidiaries, including options, warrants,
calls or similar rights, in each case, to acquire any debt securities of the Company or any of its Subsidiaries;
(o)
negotiate, amend, extend, renew (except, with respect to software license and product development Contracts, pursuant
to the renewal provisions thereof) terminate or enter into, or agree to any material amendment or material modification of, or
waive, release or assign any material rights under, any Company Material Contract, any Contract with a Material Supplier, or any
material Lease for any Company Leased Property, or any Contract that would have been a Company Material Contract or a material
Lease had it been entered into prior to the date of this Agreement; provided, however, that the foregoing exception
shall not apply to any Contract that requires or provides for consent, acceleration, termination or any other material right or
consequence triggered in whole or in part by the Merger or any of the other transactions contemplated by this Agreement;
(p)
negotiate, amend, modify, enter into or terminate any Labor Agreement, except as required pursuant to an applicable
Contract in effect as of the date of this Agreement;
(q)
make any material change to its or any of its Subsidiaries’ methods, policies and procedures of accounting,
except as required by GAAP or Regulation S-X of the Exchange Act or other applicable Law;
(r)
except (i) as set forth in the Company’s existing capital budget; or (ii) as relates to the purchase of inventory
or surgical instruments in the ordinary course of business, make or authorize any capital expenditure exceeding $500,000 in the
aggregate;
(s)
agree to release, compromise, assign, settle, or resolve any threatened or pending Proceeding, other than settlements
that result solely in monetary obligations involving payment (without the admission of wrongdoing) by the Company or any of its
Subsidiaries of an amount not greater than $250,000 (net of insurance proceeds) in the aggregate;
(t)
fail to use commercially reasonable efforts to maintain in effect material insurance policies covering the Company
and its Subsidiaries and their respective properties, assets and businesses;
(u)
(i) sell, transfer, assign, lease, license or otherwise dispose of (whether by merger, stock or asset sale or otherwise)
to any Person any rights to any Company Intellectual Property material to the Company and its Subsidiaries, taken as a whole (except
for licensing non-exclusive rights for the primary purpose of (A) conducting clinical research, entered into with a clinical research
organization; (B) material transfer, sponsored research or other similar matters; (C) establishing confidentiality or non-disclosure
obligations; (D) conducting clinical trials; or (E) manufacturing, labeling or selling the Company’s or any of its Subsidiaries’
products or services); (ii) fail to use all reasonable efforts not to cancel, dedicate to the public, disclaim, forfeit, reissue,
reexamine or abandon without filing a substantially identical counterpart in the same jurisdiction with the same priority or allow
to lapse (except with respect to Patents expiring in accordance with their terms) any Company Intellectual Property material to
the Company and its Subsidiaries, taken as a whole; (iii) fail to use all reasonable efforts to make any filing, pay any fee, or
take any other action necessary to prosecute and maintain in full force and effect any Company Registered IP including allowing
any such patent families with pending applications to close by not filing a continuing application; (iv) make any change in Company
Intellectual Property that is or would reasonably be expected to materially impair the Company’s or any of its Subsidiaries’
rights with respect to the Company Intellectual Property; (v) disclose to any Person (other than Representatives of Parent and
Merger Sub), any Trade Secrets, know-how or confidential or proprietary information, except, in the case of confidential or proprietary
information, in the ordinary course of business to a Person that is subject to confidentiality obligations; or (vi) fail to take
or maintain reasonable measures to protect the confidentiality and value of material Trade Secrets included in the Company Owned
IP;
(v)
except as required by applicable Law, (i) make or change any material Tax election or adopt or change any material
method of Tax accounting; (ii) file any material amended Tax Return; (iii) settle or compromise any audit, assessment or other
Proceeding relating to Taxes; (iv) agree to an extension or waiver of the statute of limitations with respect to Taxes; (v) enter
into any “closing agreement” within the meaning of Section 7121 of the Code (or any similar provision of state, local
or non-U.S. Law); or (vi) surrender any right to claim a Tax refund;
(w)
merge or consolidate the Company or any of its Subsidiaries with any Person or adopt a plan of complete or partial
liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company or any of its Subsidiaries;
(x)
enter into or adopt any stockholder rights plans (or similar plans commonly referred to as a “poison pill”)
under which the Company is or may become obligated to sell or otherwise issue any shares of its capital stock or any other Securities;
or
(y)
enter into any agreement, contract, commitment or arrangement to do, or adopt any resolutions approving or authorizing,
or publicly announce an intention to do, any of the foregoing.
Nothing contained herein
shall give Parent, Merger Sub or any of their respective Affiliates, directly or indirectly, the right to control or direct the
Company’s or its Subsidiaries’ operations prior to the Effective Time, and nothing contained herein shall give the
Company, directly or indirectly, the right to control or direct Parent’s or its Subsidiaries’ operations prior to the
Effective Time. Prior to the Effective Time, each of the Company and Parent shall exercise, subject to the terms and conditions
of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations.
Section 5.2
Proxy Statement; Company Stockholders’ Meeting.
(a)
The Company shall use reasonable efforts to prepare and file the preliminary Proxy Statement with the SEC as soon
as reasonably practicable (and in any event will file the preliminary Proxy Statement within twenty (20) Business Days after the
date hereof). The Company shall use its reasonable efforts to respond to any comments of the SEC or its staff, to clear the preliminary
Proxy Statement with the SEC as promptly as reasonably practicable after filing and to cause the Proxy Statement to be mailed to
the Company’s stockholders as promptly as reasonably practicable after the date of this Agreement. The Company will advise
Parent promptly after receipt of any request by the SEC or its staff for amendments or supplements to the Proxy Statement or comments
thereon and responses thereto or requests by the SEC or its staff for additional information. The Company will promptly provide
Parent with copies of all written correspondence between the Company (or its Representatives) and the SEC (or its staff) regarding
the Proxy Statement or the Merger. If at any time prior to the Company Stockholders’ Meeting there shall occur any event
that is required to be set forth in an amendment or supplement to the Proxy Statement, the Company shall as promptly as reasonably
practicable prepare and mail to its stockholders such an amendment or supplement. Notwithstanding anything to the contrary in this
Section 5.2, prior to filing or mailing the Proxy Statement (or any amendment or supplement thereto) or responding to any
comments of the SEC (or its staff) with respect thereto, the Company shall provide Parent an opportunity to review and comment
on such document or response (and the Company shall consider in good faith any comments on such document(s) or response reasonably
proposed by Parent or its Representatives).
(b)
Each of Parent and Merger Sub shall promptly furnish the Company with all information reasonably requested by the
Company and required pursuant to the Exchange Act and the rules and regulations promulgated thereunder to be set forth in the Proxy
Statement about Siemens Healthineers, Parent and Merger Sub.
(c)
Each of the Company, Parent and Merger Sub agrees to promptly (i) correct any information provided by it specifically
for use in the Proxy Statement if and to the extent that such information will have become false or misleading in any material
respect and (ii) supplement the information provided by it specifically for use in the Proxy Statement to include any information
that will become necessary in order to make the statements in the Proxy Statement, in light of the circumstances under which they
were made, not misleading. The Company further agrees to cause the Proxy Statement as so corrected or supplemented promptly to
be filed with the SEC and to be disseminated to the holders of Company Common Stock, in each case as and to the extent required
by applicable Law.
(d)
Subject to the Company Board not having effected a Company Adverse Recommendation Change pursuant to Section 5.5
or the earlier termination of this Agreement in accordance with Section 7.1, the Company (i) shall duly call, give notice
of, convene and hold, as promptly as practicable after the SEC clearance of the Proxy Statement, a special meeting of the Company’s
stockholders (including any adjournment or postponement thereof, the “Company Stockholders’ Meeting”),
in accordance with applicable Law, its constituent documents and the rules of the NYSE American, for the purpose of considering
and voting on the adoption of this Agreement, the Merger and other transactions contemplated by this Agreement and shall submit
such proposal to such holders at the Company Stockholders’ Meeting, (ii) except for a proposal to adjourn the Company Stockholders’
Meeting if there are insufficient affirmative votes represented at the Company Stockholders’ Meeting to obtain the Company
Stockholder Approval, shall not submit any other proposal to such holders in connection with the Company Stockholders’ Meeting
without the prior written consent of Parent (which consent shall not be unreasonably conditioned, withheld or delayed), and (iii)
shall not adjourn or otherwise postpone or delay the Company Stockholders’ Meeting without the prior written consent of Parent;
provided, however, that the Company may, without the prior written consent of Parent, adjourn or postpone the Company
Stockholders’ Meeting (A) to the extent necessary to ensure that any required supplement or amendment to the Proxy Statement
is provided to the stockholders of the Company, provided, that the Company has reasonably consulted with Parent prior to
such adjournment or postponement, (B) if as of the time for which the Company Stockholders’ Meeting is originally scheduled
(as set forth in the Proxy Statement) there are insufficient shares of Company Stock represented (either in person or by proxy)
to constitute a quorum necessary to conduct the business of the Company Stockholders’ Meeting, or (C) in order to solicit
additional proxies if necessary to obtain the Company Stockholder Approval. Subject to the Company Board not having effected a
Company Adverse Recommendation Change pursuant to Section 5.5, the Company shall, through the Company Board, make the Company
Recommendation, and shall include such Company Recommendation in the Proxy Statement, and use its reasonable efforts to solicit
from its stockholders proxies in favor of the adoption of this Agreement.
(e)
Immediately following the execution of this Agreement, Parent shall execute and deliver, in accordance with Section
228 of the DGCL and in its capacity as the sole direct or indirect stockholder of Merger Sub, a written consent evidencing the
approval and adoption of the Merger, this Agreement and the other transactions contemplated hereby.
Section 5.3
Appropriate Action; Consents; Filings.
(a)
Subject to the terms and conditions of this Agreement, the parties hereto will use their respective reasonable best
efforts to consummate and make effective the transactions contemplated by this Agreement and to cause the conditions to the Merger
set forth in Article VI to be satisfied, including using reasonable best efforts to accomplish the following: (i) the obtaining
of all necessary actions or non-actions, consents and approvals from Governmental Authorities or other Persons necessary in connection
with the consummation of the transactions contemplated by this Agreement, including the Merger, and (ii) the making of all necessary
registrations and filings (including filings with Governmental Authorities, if any) and the taking of all reasonable steps as may
be necessary to obtain approval from, or to avoid a Proceeding by, any Governmental Authority or other Persons necessary in connection
with the consummation of the transactions contemplated by this Agreement, including the Merger. Each of the parties hereto shall
as promptly as reasonably practicable after the date of this Agreement, upon a date to be mutually agreed upon by the parties hereto,
make its respective filings under the HSR Act. Each of the parties hereto shall as promptly as reasonably practicable after the
date of this Agreement, upon a date to be mutually agreed upon by the parties hereto, make any other applications and filings as
reasonably determined by the Company and Parent under other applicable Antitrust Laws with respect to the transactions contemplated
by this Agreement as promptly as reasonably practicable, but in no event later than as required by Law. Notwithstanding anything
to the contrary contained in this Agreement, neither Parent nor the Company or any of their respective Affiliates shall be required
to, and without the prior written consent of Parent, none of the Company or any of its Subsidiaries or Affiliates will, grant or
offer to grant any accommodation or concession (financial or otherwise), or make any payment, to any third Person in connection
with seeking or obtaining its consent to the transactions contemplated by this Agreement (it being understood that this sentence
does not apply to the actions required by Section 5.3(d)).
(b)
In connection with and without limiting the efforts referenced in this Section 5.3, each of the parties hereto
will furnish to the other such necessary information and reasonable assistance as the other may reasonably request in connection
with the preparation of any required governmental filings or submissions and will cooperate in responding to any investigation
or other inquiry from a Governmental Authority or in connection with any Proceeding initiated by a private party, in each case,
under any applicable Antitrust Laws, including (i) promptly informing the other party of such inquiry or Proceeding, (ii) consulting
in advance before making any presentations or submissions to a Governmental Authority, or in connection with any such Proceeding,
to any other Person, and supplying each other with copies of all material correspondence, filings or communications between either
party and any Governmental Authority, or in connection with any such Proceeding, between either party and any other Person with
respect to this Agreement and (iii) providing the other party with a reasonable advance opportunity to review and comment upon
and consider in good faith the views of the other party in connection with all written communications (including any analyses,
presentations, memoranda, briefs, arguments, opinions and proposals) between either party and any Governmental Authority, or in
connection with any such Proceeding, between either party and any other Person with respect to this Agreement; provided
that materials required to be provided by one party to another pursuant to this Section 5.3(b) may be redacted (A) to remove
references concerning the valuation of the Company, (B) as necessary to comply with contractual arrangements, and (C) as necessary
to address reasonable attorney-client or other privilege or confidentiality concerns or may be provided on an outside counsel basis,
if reasonably appropriate. In addition, each of the parties hereto will give reasonable notice to and consult with the other party
in advance of any meeting or substantive telephone call or conference with any Governmental Authority, or in connection with any
such Proceeding, with any other Person, and to the extent permitted by the Governmental Authority, give the other party the opportunity
to attend and participate in such meeting, telephone call or conference.
(c)
The parties shall consult with each other with respect to obtaining all permits and Consents necessary to consummate
the transactions contemplated by this Agreement, including the Merger.
(d)
Notwithstanding anything in this Agreement to the contrary, none of Parent or any of its Affiliates shall be required
to enter into one or more agreements prior to the Closing with respect to any transaction to divest, hold separate or otherwise
take any action that limits the Parent’s or any of its Affiliates’ (including, following the Closing, the Company’s
or any of its Subsidiaries’) freedom of action, ownership or control with respect to, or their ability to retain or hold,
directly or indirectly, any of their respective businesses, assets, equity interests, product lines or properties (each, a “Divestiture
Action”) or take any Divestiture Action or otherwise agree to or proffer to sell, divest, hold separate, lease, license,
transfer, dispose of or otherwise encumber or impair or take any other action with respect to Parent’s or any of its Affiliates’
ability to own or operate any assets, properties, businesses or product lines of Parent or any of its Affiliates (including, following
the Closing, any assets, properties, businesses or product lines of the Company or its Subsidiaries); and none of Parent or any
of its Affiliates shall be required to take any action contemplated in this Section 5.3(d) in connection with any Proceeding
by a Person other than a Governmental Authority, and the Company shall not, and shall not cause or permit any of its Subsidiaries
to, unless requested to do so by Parent, commit to or effect any action contemplated in this Section 5.3(d).
Section 5.4
Access to Information; Confidentiality. From the
date of this Agreement until the earlier of the Effective Time and the date, if any, on which this Agreement is terminated in accordance
with Section 7.1, the Company shall, and shall cause each of its Subsidiaries to, afford to Parent and Merger Sub, and their
respective Representatives, reasonable access, to be coordinated through the Company or its designated Representatives in accordance
with such reasonable procedures as they may establish, during normal business hours and upon reasonable notice, to all of the officers,
employees, agents, properties, books, contracts and records of the Company and its Subsidiaries, and during such period, the Company
shall, and shall cause each of its Subsidiaries to, furnish reasonably promptly all other information concerning the business,
properties and personnel of the Company and its Subsidiaries as Parent or Merger Sub may reasonably request; provided, that,
notwithstanding the foregoing, the Company may restrict or prohibit such access to the extent that (a) any applicable Law
requires the Company or its Subsidiaries to restrict or prohibit such access; (b) granting such access would violate any Contract
or material obligation of the Company or any of its Subsidiaries with a third Person with respect to confidentiality or otherwise
breach, contravene or violate, constitute a default under, or give a third Person the right to terminate or accelerate any obligations
under, any then-effective Contract to which the Company or any of its Subsidiaries is a party or would disclose any information
that is competitively sensitive; or (c) granting access to such documents or information would reasonably be expected to result
in a waiver of any attorney-client privilege, work product doctrine or other applicable privilege in respect of such documents
or information, provided, however, that the Company shall use good faith efforts to communicate the applicable information
to Parent in a manner that would not violate applicable Law, Contract or material obligation or waive such privilege or work-product
doctrine. Prior to the Effective Time, Parent and Merger Sub will hold any information obtained pursuant to this Section 5.4
in accordance with the terms of the Confidentiality Agreement. No investigation pursuant to this Section 5.4 shall affect
or be deemed to modify any representation or warranty made by the Company hereunder. Notwithstanding anything contained herein
to the contrary, the Company and its Subsidiaries shall not be required to provide any access or make any disclosure to Parent
pursuant to this Section 5.4 to the extent such access or information is reasonably pertinent to a litigation where the
Company or any of its Affiliates, on the one hand, and Parent or any of its Affiliates, on the other hand, are adverse parties.
Section 5.5
No Solicitation.
(a)
From the date of this Agreement until the earlier of the Effective Time and the date, if any, on which this Agreement
is terminated in accordance with Section 7.1, except as expressly provided in Section 5.5(b) or Section 5.5(d),
(i) the Company shall immediately cease and cause to be terminated, and shall cause its Subsidiaries and instruct its and its Subsidiaries’
Representatives to immediately cease and cause to be terminated, all existing activities, discussions, negotiations and communications,
if any, with any Persons (or any of their Representatives) with respect to any Company Acquisition Proposal (other than Parent
or any of its Affiliates or Representatives with respect to the transactions contemplated by this Agreement); and (ii) the Company
shall not, and shall not permit its Subsidiaries and its and its Subsidiaries’ Representatives to, directly or indirectly,
(A) initiate, seek, solicit, facilitate or knowingly encourage, or knowingly induce the making, submission or announcement of,
any Company Acquisition Proposal, (B) enter into, continue or otherwise participate in any negotiations or discussions with, or
furnish or cause to be furnished any non-public information or data to, or furnish access to the Company’s (or any of its
Subsidiaries’) properties with respect to, any Person (other than Parent or any of its Affiliates or Representatives) relating
to any Company Acquisition Proposal or any inquiry, proposal or offer that would reasonably be expected to lead to any Company
Acquisition Proposal (other than informing any Persons of the provisions of this Section 5.5), or grant any waiver or release
under (or terminate, amend or modify any provision of) any confidentiality agreement to which the Company is a party except to
the extent to allow an applicable party to make a Company Acquisition Proposal in compliance with Section 5.5(b), (C) execute
or enter into any binding or non-binding letter of intent, agreement in principle, memorandum of understanding, merger agreement,
acquisition agreement, option agreement, joint venture agreement, partnership agreement or other agreement, commitment, arrangement
or understanding relating to or in connection with, or that is intended to lead to, any Company Acquisition Proposal (each, an
“Alternative Acquisition Agreement”), (D) submit to the stockholders of the Company for their approval any Company
Acquisition Proposal or Company Superior Proposal, or (E) resolve to do, or agree or publicly announce an intention to do, any
of the foregoing.
(b)
Notwithstanding anything to the contrary contained in Section 5.5(a), at any time prior to obtaining the Company
Stockholder Approval, if the Company or any of its Subsidiaries receives, after the date hereof, a bona fide written Company Acquisition
Proposal from a third Person that did not result from a breach of this Section 5.5, then the Company may contact such third
Person to clarify the terms and conditions thereof and (i) furnish information concerning its business, properties or assets to
such Person pursuant to an Acceptable Confidentiality Agreement (a copy of which shall be provided to Parent within forty-eight
(48) hours after execution) and (ii) negotiate and participate in discussions and negotiations with such Person concerning
such Company Acquisition Proposal, in each case of clause (i) and (ii), if the Company Board (or a duly authorized committee thereof)
determines in good faith (after consultation with the Company’s financial advisors and outside legal counsel) that (A) such
Company Acquisition Proposal constitutes or could reasonably be expected to lead to or result in a Company Superior Proposal and
(B) the failure to take such action would reasonably be expected to be inconsistent with the Company Board’s fiduciary duties
under applicable Law. The Company (1) shall promptly (and in any case within forty-eight (48) hours) provide Parent notice (x)
of the receipt of any Company Acquisition Proposal, which notice shall include, if applicable, a complete, unredacted copy of such
Company Acquisition Proposal, and (y) of any inquiries, proposals or offers received by the Company, any of its Subsidiaries or
any of its or its Subsidiaries’ Representatives concerning a Company Acquisition Proposal or proposal that is reasonably
likely to constitute or lead to or result in a Company Acquisition Proposal, and disclose the identity of the other party (or parties)
and, if applicable, the material terms (including any amendments thereto) of such inquiry, offer or proposal (2) shall promptly
(and in any case within forty-eight (48) hours) make available to Parent all information, including copies of all written materials,
provided by the Company or any of its Subsidiaries or its or its Subsidiaries’ Representatives to such party but not previously
made available to Parent and (3) shall keep Parent reasonably informed on a reasonably prompt basis (and, in any case, within forty-eight
(48) hours) of any significant development, discussions or negotiations (including amendments and proposed amendments) relating
to any such Company Acquisition Proposal or any material change to the financial or other material terms of any such Company Acquisition
Proposal or such other inquiry, offer or proposal (including by providing copies of all required proposals related thereto that
have not already been provided pursuant to clauses (1)(x) or (y) above, respectively).
(c)
Except as expressly permitted by Section 5.5(d) or Section 5.5(e), neither the Company Board nor any
committee thereof shall (i) withdraw, qualify or modify in a manner adverse to Parent, or publicly propose to withdraw, qualify
or modify in a manner adverse to Parent, the Company Recommendation, (ii) approve, authorize, declare advisable, endorse or recommend
(or publicly propose to approve, authorize, declare advisable, endorse or recommend) any Company Acquisition Proposal, (iii) fail
to include in the Proxy Statement the Company Recommendation, (iv) fail to recommend against any Company Acquisition Proposal that
is a tender or exchange offer subject to Regulation 14D under the Exchange Act in a Solicitation/Recommendation Statement on Schedule
14D-9 within ten (10) Business Days after the commencement (within the meaning of Rule 14d-2 under the Exchange Act) of such tender
or exchange offer (any action described in clauses (i) through (iv) of this sentence being referred to as a “Company Adverse
Recommendation Change”), or (v) adopt or approve, or propose to adopt or approve, or allow the Company or any of its
Subsidiaries to execute or enter into, any Alternative Acquisition Agreement (other than an Acceptable Confidentiality Agreement
permitted under Section 5.5(b)).
(d)
Notwithstanding anything in this Agreement to the contrary, if at any time prior to the receipt of the Company Stockholder
Approval, the Company or the Company Board receives a Company Superior Proposal, the Company Board may authorize and cause the
Company to (i) effect a Company Adverse Recommendation Change and/or (ii) terminate this Agreement pursuant to Section
7.1(c)(ii) and concurrently with such termination enter into a definitive agreement providing for such Company Superior Proposal
(subject to the satisfaction of its obligations under Section 7.3) if (A) the Company Board determines in good faith,
after consultation with the Company’s outside legal counsel, that the failure to take such action would reasonably be expected
to be inconsistent with the Company Board’s fiduciary duties under applicable Law; (B) the Company has notified Parent
in writing that it intends to take such action; (C) the Company has provided Parent a copy of the proposed definitive agreements
(and any related agreements) relating to such Company Superior Proposal (and has informed Parent of the identity of the Person
making such Company Superior Proposal); and (D) if prior to 11:59 p.m., New York City time, on the second (2nd) Business
Day following the notice delivered pursuant to clause (B) of this Section 5.5(d), the Company and its Representatives shall
have received a written proposal made by Parent to amend this Agreement or enter into an alternative transaction with the Company,
the Company Board shall have determined in good faith (after consultation with the Company’s financial advisor and outside
legal counsel), after considering and taking into account the terms of any proposed amendment or modification to this Agreement
or a possible alternative transaction made by Parent in writing solely during such period, that (1) the Company Acquisition Proposal
that is the subject of the notice described in clause (B) of this Section 5.5(d) still constitutes a Company Superior Proposal
and (2) the failure to take such action would reasonably be expected to be inconsistent with the Company Board’s fiduciary
duties under applicable Law.
(e)
Notwithstanding anything in this Agreement to the contrary, other than in connection with a Company Superior Proposal
(which shall be subject to Section 5.5(d) and shall not be subject to this Section 5.5(e)), prior to obtaining the
Company Stockholder Approval, the Company Board may, in response to a Company Intervening Event, effect a Company Adverse Recommendation
Change if (i) the Company Board determines in good faith, after consultation with the Company’s outside legal counsel,
that the failure to take such action would reasonably be expected to be inconsistent with the Company Board’s fiduciary duties
under applicable Law; and (ii) the Company has notified Parent in writing that it intends to effect such Company Adverse Recommendation
Change pursuant to this Section 5.5(e) (which notice shall reasonably specify the facts and circumstances providing the
basis of the Company Intervening Event and for the Company Board’s determination to effect the Company Adverse Recommendation
Change).
(f)
Nothing contained in this Agreement shall prohibit the Company or the Company Board from (i) taking and disclosing
to its stockholders a position contemplated by Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act, or from issuing a “stop,
look and listen” statement pending disclosure of its position thereunder or (ii) making any disclosure to its stockholders
if the Company Board determines in good faith, after consultation with the Company’s outside legal counsel, that the failure
of the Company Board to make such disclosure would reasonably be expected to be inconsistent with the Company Board’s fiduciary
duties under applicable Law; provided, however, that (A) in no event shall this Section 5.5(f) permit the
Company or the Company Board to make a Company Adverse Recommendation Change except as otherwise permitted pursuant to Section
5.5(d) or Section 5.5(e), (B) in no event shall this Section 5.5(f) affect, modify or supplement the definition
of Company Adverse Recommendation Change herein (or to the consequences thereof in accordance with this Agreement) and (C) any
such disclosure (other than issuance by the Company of a “stop, look and listen” communication of the type contemplated
by Rule 14d-9(f) under the Exchange Act) that addresses or relates to the approval, recommendation or declaration of advisability
by the Company Board with respect to this Agreement or a Company Acquisition Proposal shall be deemed to be a Company Adverse Recommendation
Change unless the Company Board in connection with such communication publicly states that its recommendation with respect to this
Agreement has not changed or refers to the prior recommendation of the Company Board, without disclosing any Company Adverse Recommendation
Change; provided further that any factually accurate public statement that describes the Company’s receipt of a Company
Acquisition Proposal and the operation of this Agreement with respect thereto shall not be deemed to be a Company Adverse Recommendation
Change. The Company shall provide Parent with a copy of the text of any disclosure proposed to be made pursuant to this Section
5.5(f) reasonably in advance of such disclosure.
Section 5.6
Directors’ and Officers’ Indemnification and Insurance.
(a)
From and after the Effective Time through the sixth (6th) anniversary of the date on which the Effective
Time occurs, Parent and the Surviving Corporation will jointly and severally indemnify and hold harmless each director and officer
of the Company at or prior to the Effective Time (the “D&O Indemnified Parties”)
with respect to all claims, liabilities, losses, damages, judgments, fines, penalties, costs (including amounts paid in settlement
or compromise) and expenses (including fees and expenses of legal counsel) in connection with any Proceeding, whenever asserted,
based on or arising out of, in whole or in part, (i) the fact that a D&O Indemnified Party was a director, officer, employee
or agent of the Company or any of its Subsidiaries, or (ii) acts or omissions by such D&O Indemnified Party in the D&O
Indemnified Party’s capacity as a director, officer, employee or agent of the Company or a Subsidiary of the Company or taken
at the request of the Company or a Subsidiary of the Company (including in connection with serving at the request of the Company
or such Subsidiary as a director, officer, employee agent, trustee or fiduciary of another Person), in each case under (i) or (ii),
at, or at any time before, the Effective Time (including any Proceeding relating in whole or in part to the Merger or the enforcement
of this provision or any other indemnification or advancement right of any D&O Indemnified Party), to the fullest extent permitted
or required by applicable Law. For the avoidance of doubt, in no event will Parent have any obligations or liabilities to D&O
Indemnified Parties under this Section 5.6(a), other than those obligations or liabilities that the Surviving Corporation
will have to D&O Indemnified Parties under this Section 5.6(a).
(b)
Parent and Merger Sub agree that all rights to indemnification and exculpation from liabilities, including advancement
of expenses, for acts or omissions occurring at or prior to the Effective Time now existing in favor of the D&O Indemnified
Parties as provided in the Certificate of Incorporation, the Bylaws, or any indemnification Contract between such D&O Indemnified
Parties and the Company set forth on Section 5.6(b) of the Company Disclosure Letter and a copy of which was provided
to Parent, (in each case, as in effect on the date of this Agreement) shall survive the Merger and shall continue in full force
and effect. Without limiting the foregoing, for a period of six (6) years from the Effective Time, the Surviving Corporation shall,
and Parent shall cause the Surviving Corporation to, maintain in effect the exculpation, indemnification and advancement of expenses
provisions equivalent to the provisions of the Certificate of Incorporation and Bylaws as in effect immediately prior to the Effective
Time solely with respect to acts or omissions occurring prior to the Effective Time and shall not amend, repeal or otherwise modify
any such provisions in any manner that would adversely affect the rights thereunder of any D&O Indemnified Parties; provided,
however, that all rights to indemnification in respect of any action pending or asserted or any claim made for indemnification
within such period shall continue until the disposition of such action or resolution of such claim. From and after the Effective
Time, Parent shall guarantee and stand surety for, and shall cause the Surviving Corporation to honor, in accordance with their
respective terms, each of the covenants contained in this Section 5.6. In addition, from the Effective Time until six (6)
years from the Effective Time, Parent will, and will cause the Surviving Corporation to, advance any expenses (including fees and
expenses of legal counsel) of any D&O Indemnified Party under this Section 5.6 (including in connection with enforcing
the indemnity and other obligations referred to this in this Section 5.6) as incurred to the fullest extent permitted under
applicable Law, provided that the individual to whom expenses are advanced provides an undertaking to repay such advances if it
is determined that such Person is not entitled to be indemnified pursuant to this Section 5.6(b).
(c)
Prior to the Effective Time, the Company shall or, if the Company is unable to, Parent shall cause the Surviving
Corporation as of or after the Effective Time to, purchase a six (6)-year prepaid “tail” policy with reputable insurers,
with terms, conditions, retentions and limits of liability that are no less favorable than the coverage provided under the Company’s
existing policies of directors’ and officers’ liability insurance and fiduciary liability insurance, with respect to
matters arising on or before the Effective Time (including in connection with this Agreement and the transactions or actions contemplated
by this Agreement), and Parent shall cause such policy to be maintained in full force and effect, for its full term, and cause
all obligations thereunder to be honored by the Surviving Corporation, and no other party shall have any further obligation to
purchase or pay for insurance hereunder; provided, however, that the Company shall not pay, and the Surviving Corporation
shall not be required to pay, in excess of 300% of the last annual premium paid by the Company prior to the date of this Agreement
in respect of such “tail” policy. If the Company or the Surviving Corporation for any reason fails to obtain such “tail”
insurance policies prior to, as of or after the Effective Time, Parent shall, for a period of six (6) years from the Effective
Time, cause the Surviving Corporation to maintain in effect the current policies of directors’ and officers’ liability
insurance and fiduciary liability insurance maintained by the Company with respect to matters arising on or before the Effective
Time; provided, further, however, that after the Effective Time, Parent shall not be required to pay annual
premiums in excess of 300% of the last annual premium paid by the Company prior to the date of this Agreement in respect of the
coverage required to be obtained pursuant hereto, but in such case shall purchase as much coverage as reasonably practicable for
such amount.
(d)
The covenants contained in this Section 5.6 shall survive the consummation of the Merger and are intended
to be for the benefit of, and shall be enforceable by, each of the D&O Indemnified Parties and their respective heirs and representatives,
and are in addition to, and not in substitution for, any other rights to indemnification or contribution that any such individual
may have under the Company’s constituent documents, by Contract or otherwise. The obligations of Parent and the Surviving
Corporation under this Section 5.6 may not be terminated or modified in such a manner as to adversely affect the rights
of any of the D&O Indemnified Parties to whom this Section 5.6 applies unless (i) such termination or modification is
required by applicable Law or (ii) the affected D&O Indemnified Parties will have consented in writing to such termination
or modification (it being expressly agreed that the D&O Indemnified Parties to whom this Section 5.6 applies will be
third-party beneficiaries of this Section 5.6).
(e)
In the event that Parent or the Surviving Corporation or any of their respective successors or assigns (i) consolidates
with or merges into any other Person and shall not be the continuing or surviving corporation or entity of such consolidation or
merger or (ii) transfers or conveys all or substantially all of its properties and assets to any Person, then, and in each such
case, Parent and the Surviving Corporation shall cause proper provision to be made so that the successors or assigns of Parent
or the Surviving Corporation, as the case may be, shall assume the obligations set forth in this Section 5.6.
Section 5.7
Notification of Certain Matters. The Company shall
give prompt notice to Parent of (a) the occurrence or non-occurrence of any event whose occurrence or non-occurrence, as the case
may be, could reasonably be expected to cause any condition set forth in Section 6.1 or Section 6.2 not to be satisfied
at any time from the date of this Agreement to the Effective Time; and (b) any notice or other communication from any third Person
alleging that the consent of such third Person is or may be required in connection with the Merger or the other transactions contemplated
by this Agreement. Parent shall give prompt notice to the Company of (i) the occurrence or non-occurrence of any event whose occurrence
or non-occurrence, as the case may be, could reasonably be expected to cause any condition set forth in Section 6.1 or Section
6.3 not to be satisfied at any time from the date of this Agreement to the Effective Time; and (ii) any notice or other communication
from any third Person alleging that the consent of such third Person is or may be required in connection with the Merger or the
other transactions contemplated by this Agreement. Notwithstanding anything in this Agreement to the contrary, no such notification
shall affect the representations, warranties, covenants or agreements of the parties hereto or the conditions to the obligations
of the parties hereto hereunder and any failure to give such notice with respect to clauses (b) or (c) above, or (ii) or (iii)
above, as applicable, shall not constitute a breach of this Section 5.7 for purposes of Section 6.2(b) or Section
6.3(b).
Section 5.8
Public Disclosure. Parent and the Company shall mutually
agree on the initial press release or releases with respect to the execution of this Agreement. Thereafter, during the period that
this Agreement remains in effect, except as otherwise expressly permitted by this Agreement, neither the Company nor Parent, nor
any of their respective Affiliates, shall issue any press release or other announcement with respect to the Merger, the other transactions
contemplated by this Agreement or this Agreement without the prior consent of the other party (such consent not to be unreasonably
conditioned, withheld or delayed), except as such press release or other announcement may be required by Law or the rules of a
national securities exchange or trading market on which such party’s Securities are listed, in which case the party required
to make the release or announcement shall use its reasonable efforts to provide the other party with a reasonable opportunity to
review and comment on such release or announcement in advance of its issuance. Notwithstanding the foregoing, (a) the restrictions
set forth in this Section 5.8 shall not apply to any press release or other announcement (i) made by the Company with respect
to or in connection with a Company Adverse Recommendation Change effected by the Company Board in accordance with this Agreement,
(ii) made by the Company or Parent concerning this Agreement, the Merger or the other transactions contemplated hereby in connection
with a determination by the Company or the Company Board in accordance with Section 5.5(b) or Section 5.5(d) that
a Company Acquisition Proposal constitutes, or is reasonably likely to constitute, a Company Superior Proposal, or (iii) made by
the Company or Parent in connection with any dispute between the parties regarding this Agreement, the Merger or the transactions
contemplated hereby, provided, however, that in the case of the preceding clause (i) or (ii), to the extent not prohibited
by applicable Law, the disclosing party gives the other party reasonable advance notice of (including the contents of) its intended
press release or other announcement, and (b) to the extent the content of any press release or other announcement has been previously
approved and made in accordance with this Section 5.8, no separate approval shall be required in respect of such content
to the extent such content is substantially replicated in a subsequent press release or other announcement or substantially consistent
with a previously approved press release or announcement.
Section
5.9 Intellectual
Property Matters. The Company shall, prior to the Closing use reasonable best efforts to ensure that title in all Company
Registered IP is recorded in the name of the Company or one or more of its Subsidiaries, as applicable, and to the extent that
any such Company Registered IP is recorded in any governmental registry in the name of any Person other than the Company or any
of its Subsidiaries, or there are outstanding encumbrances of any type against such Company Registered IP, use reasonable best
efforts to obtain appropriate assignments, discharges or other documents intended to place record ownership in the name of the
Company or any of its Subsidiaries or effect the discharge prior to the Closing, as applicable. The Company shall use reasonable
efforts to ensure that all maintenance, annuity and other fees and all filings necessary to assure the continued enjoyment of any
issued Company Registered IP, and all amendments, responses to office actions, issue fees and other fees and filings necessary
to maintain the pendency of and pursue the prosecution of any pending applications have been and will be paid or filed on a timely
basis through the Closing.
Section
5.10 Employee Matters.
(a) For
the period commencing at the Effective Time and ending on the earlier of (i) the date that is twelve (12) months following the
Effective Time and (ii) the date on which the employment of an employee of the Company or any of its Subsidiaries who continues
his or her employment with Parent, the Surviving Corporation or any of their respective Affiliates following the Effective Time
(each, a “Continuing Employee”) terminates, Parent, the Surviving Corporation or any of their respective Affiliates
shall provide each Continuing Employee with (A) an annual base salary at least equal to the annual base salary provided to such
Continuing Employee immediately prior to the Effective Time, (B) cash bonus and cash incentive opportunities that are no less
favorable than the cash bonus and cash incentive opportunities provided to such Continuing Employee as of immediately prior to
the Effective Time, (C) severance payments and benefits that are no less favorable than the severance payments and benefits to
which such Continuing Employee would be entitled under the applicable Benefit Plan in effect as of immediately prior to the Effective
Time, and (D) employee benefits that are no less favorable (in the aggregate) to the employee benefits (excluding for such purposes
any defined benefit pension benefits and any equity based compensation plans) provided to such Continuing Employee as of immediately
prior to the Effective Time.
(b) If
the Closing occurs (i) prior to the completion of the 2019 fiscal year or (ii) after the completion of the 2019 fiscal year but
prior to the payment of bonuses with respect to such fiscal year, Parent or its Subsidiaries (including the Surviving Corporation)
shall pay an annual bonus under the applicable bonus plans of the Company and its Subsidiaries in respect of the 2019 fiscal year
to each eligible employee of the Company or any of its Subsidiaries based on actual performance levels as of the date of this
Agreement, extrapolated through the last day of the 2019 fiscal year (if applicable), as calculated by the Company in good faith,
which payment shall be made at the time such bonuses would ordinarily be paid to eligible employees by the Company and its Subsidiaries
pursuant to the terms of such plans and in compliance with Section 409A of the Code. If the Closing occurs during the 2020 fiscal
year, Parent or its Subsidiaries (including the Surviving Corporation) shall pay a pro-rated annual bonus under the applicable
bonus plans of the Company and its Subsidiaries in respect of the portion of the 2020 fiscal year that occurs prior to the Closing
Date to each eligible employee of the Company or any of its Subsidiaries based on target level performance through the Closing
Date, which payment will be made within thirty (30) days following the Closing Date.
(c) Parent
agrees that each Continuing Employee shall, as of the Effective Time, receive full credit for service with the Company or any
of its Subsidiaries prior to the Effective Time for purposes of determining eligibility to participate, vesting and benefit accrual
under the employee benefit plans, programs and policies of Parent, the Surviving Corporation or any of their respective Affiliates
in which such Continuing Employee becomes a participant (excluding, for the avoidance of doubt, with respect to any defined benefit
pension plan or employer subsidized retiree medical benefits); provided, however, that nothing herein shall result
in the duplication of any benefits for the same period of service. With respect to each health or welfare benefit plan maintained
by Parent, the Surviving Corporation or any of their respective Affiliates for the benefit of Continuing Employees (including
any medical, dental, pharmaceutical or vision benefit plans), Parent shall (i) cause to be waived any eligibility waiting periods,
any evidence of insurability requirements or required physical examinations, actively-at-work requirements and the application
of any pre-existing condition limitations under such plan to the extent such were waived or satisfied under the comparable health
or welfare benefit plan of the Company or any of its Subsidiaries immediately prior to the Effective Time; and (ii) cause each
Continuing Employee to be given credit under any such plans for all amounts paid (or otherwise deemed paid) by such Continuing
Employee under any similar Benefit Plan for the plan year that includes the Effective Time for purposes of applying deductibles,
co-payments and out-of-pocket maximums as though such amounts had been paid in accordance with the terms and conditions of the
plans maintained by Parent, the Surviving Corporation or any of their respective Affiliates, as applicable, for the plan year
in which the Effective Time occurs; provided, however, that Parent’s obligations under this clause (ii) shall
be subject to its receipt of all necessary information, from either the Company or such Continuing Employee, related to such amounts
paid by such Continuing Employee.
(d) If
directed in writing by Parent at least ten (10) Business Days prior to the Effective Time, the Company shall terminate, effective
as of immediately prior to the Closing, any and all Benefit Plans intended to include a Code Section 401(k) arrangement (each,
a “Company 401(k) Plan”). No later than five (5) Business Days prior to the Closing Date, the Company shall
provide Parent with evidence that the Company has taken action to terminate each Company 401(k) Plan (effective as of immediately
prior to the Closing) pursuant to resolutions of the Company Board, as the case may be. The form and substance of such resolutions
shall be subject to review and approval of Parent (which shall not be unreasonably withheld or delayed). If the Company terminates
each Company 401(k) Plan at the written direction of Parent as described in the immediately preceding sentence, Parent shall,
or shall cause one of its Subsidiaries or Affiliates to, cause a Code Section 401(k) arrangement sponsored or maintained by the
Parent or any such Subsidiary or Affiliate (each, a “Parent 401(k) Plan”) to permit each Continuing Employee
participating in such a terminated Company 401(k) Plan as of immediately prior to the Closing Date to elect to rollover his or
her account balances in such Company 401(k) Plan (including earnings through the date of transfer and promissory notes evidencing
all outstanding loans) to an applicable Parent 401(k) Plan, in each case in accordance with the terms of the applicable Company
401(k) Plan and Parent 401(k) Plan. The Company and Parent shall use commercially reasonable efforts to cooperate to effectuate
any such rollovers, including by exchanging any necessary participant records or engaging any recordkeepers, administrators, providers,
insurers, or other third parties.
(e) The
provisions of this Section 5.10 are solely for the benefit of the parties to this Agreement, and no Continuing Employee
(including any beneficiary or dependent thereof) shall be regarded for any purpose as a third-party beneficiary of this Agreement,
and no provision of this Section 5.10 shall create such rights in any such Persons. Nothing herein shall (i) guarantee
employment for any period of time or preclude the ability of Parent, the Surviving Corporation or any of their respective Affiliates,
as applicable, to terminate the employment of any Continuing Employee at any time and for any reason; (ii) require Parent, the
Surviving Corporation or any of their respective Affiliates, as applicable, to continue any Benefit Plans, or other employee benefit
plans or arrangements or prevent the amendment, modification or termination thereof after the Effective Time; or (iii) amend any
Benefit Plans or other employee benefit plans or arrangements.
Section
5.11 Merger Sub. Parent will take all actions necessary to cause Merger Sub to comply with
and perform all of its obligations under or relating to this Agreement, including causing Merger Sub to consummate the Merger
upon the terms and subject to the conditions set forth in this Agreement.
Section
5.12 Rule 16b-3 Matters. Prior to the Effective Time, the Company shall use reasonable best
efforts to take all such steps as may be reasonably necessary or advisable (to the extent permitted under applicable Law and no-action
letters issued by the SEC) to cause any dispositions of Company Common Stock (including derivative Securities with respect to
Company Common Stock) resulting from the transactions contemplated by this Agreement by each individual who is subject to the
reporting requirements of Section 16(a) of the Exchange Act with respect to the Company immediately prior to the Effective Time
to be exempt under Rule 16b-3 promulgated under the Exchange Act.
Section
5.13 Repayment and Termination of Existing Credit Agreement. The Company shall use its reasonable
best efforts to deliver to Parent, at least two (2) Business Days prior to the Closing Date, a draft of, and on or prior to the
Closing Date, an executed copy of, a customary payoff letter from the agents under the Existing Credit Agreement in form and substance
reasonably satisfactory to Parent relating to the repayment in full of all obligations thereunder or secured thereby, the termination
of all commitments in connection therewith and the release of all Liens securing the obligations thereunder (the “Payoff
Letter“). The Company shall, and shall cause its Subsidiaries to, use commercially reasonable efforts to deliver to
Parent (or the agent under the Existing Credit Agreement, in the case of prepayment and termination notices) on or prior to the
Closing, in form and substance reasonably satisfactory to Parent, all the documents, filings and notices required for the termination
of commitments under the Existing Credit Agreement and the release of all Liens securing the obligations thereunder, including
the filing of UCC termination statements, terminations of control agreements, terminations of Intellectual Property security agreements
and delivery of possessory collateral, which shall in each case be subject to the occurrence of the Closing and the repayment
in full of all obligations then outstanding under the Existing Credit Agreement. At the Closing, Parent shall pay or shall cause
to be paid, in full and in immediately available funds, any and all amounts outstanding and then due and payable under the Existing
Credit Agreement in accordance with the Payoff Letter.
Section
5.14 Stock Exchange Delisting; Deregistration. Prior to the Effective Time, the Company shall
cooperate with Parent and use its reasonable best efforts to take, or cause to be taken, all actions, and do or cause to be done
all things, necessary, proper or advisable on its part under Laws and the rules and policies of the NYSE American to cause the
delisting of the Company and of the shares of Company Common Stock from the NYSE American as promptly as practicable after the
Effective Time and the deregistration of the shares of Company Common Stock under the Exchange Act as promptly as practicable
after such delisting. The Company shall not cause the Company Common Stock to be delisted from the NYSE American prior to the
Effective Time.
Section
5.15 State Takeover Laws. If any state takeover statute becomes or is deemed to become applicable
to the Company, the Voting and Support Agreement, the Merger or the other transactions contemplated by this Agreement, then the
Company Board shall take any and all actions within its control as are necessary to render such statutes inapplicable to the foregoing.
Section
5.16 Stockholder Litigation. The Company shall give Parent notice as soon as possible of,
and the opportunity to participate in (subject to a customary joint defense agreement), but not control, the defense or settlement
of, any stockholder litigation against the Company or its directors or executive officers relating to or in connection with this
Agreement, the Merger or any other transactions contemplated by this Agreement, whether commenced prior to or after the execution
and delivery of this Agreement. The Company agrees that it shall not settle or offer to compromise or settle any such litigation
commenced prior to or after the date of this Agreement against the Company or any of its directors or executive officers relating
to or in connection with this Agreement, the Merger or any other transaction contemplated by this Agreement, in each case, without
the prior written consent of Parent (which consent shall not be unreasonably withheld, delayed or conditioned). The Company shall
promptly notify Parent of any such litigation and shall keep Parent reasonably and promptly informed with respect to the status
thereof.
Section
5.17 Resignations. Prior to the Effective Time, upon Parent’s request, the Company shall
use commercially reasonable efforts to cause any director of the Company and any director of a Subsidiary of the Company, to execute
and deliver a letter effectuating his or her resignation as a director of such entity effective as of the Effective Time.
Section
5.18 Tax Returns. The Company shall file all Tax Returns that it is required to file prior
to the Closing in the ordinary course of business, and all such Tax Returns shall be true, correct and complete in all material
respects and prepared in accordance with the Company’s past practice unless otherwise required by applicable law. At the
time that such Tax Returns are filed, the Company shall provide a copy to the Parent.
ARTICLE
VI
CONDITIONS
TO THE MERGER
Section
6.1 Conditions to the Obligations of Each Party. The respective obligations of each party
hereto to consummate the Merger and the other transactions contemplated by this Agreement are subject to the satisfaction or (to
the extent permitted by Law) waiver by the Company and Parent, as the case may be, at or prior to the Effective Time of the following
conditions:
(a) the
Company shall have obtained the Company Stockholder Approval;
(b) any
applicable waiting period (and any extension thereof) under the HSR Act relating to the consummation of the Merger shall have
expired or termination thereof shall have been granted; and
(c) no
Governmental Authority of competent jurisdiction shall have issued or entered any Order after the date of this Agreement, and
no Law shall have been enacted or promulgated after the date of this Agreement, in each case, that is then in effect and has the
effect of restraining, enjoining or otherwise prohibiting the consummation of the Merger or the other transactions contemplated
by this Agreement.
Section
6.2 Conditions to the Obligations of Parent and Merger Sub. The obligations of Parent and
Merger Sub to effect the Merger and the other transactions contemplated by this Agreement are subject to the satisfaction or (to
the extent permitted by Law) waiver by Parent at or prior to the Effective Time of the following additional conditions:
(a) (i)
the representations and warranties of the Company contained in Section 3.2(a), Section 3.2(c) and Section
3.7(b) shall be true and correct in all respects (except in the case of Section 3.2(a) and Section 3.2(c)
for any de minimis inaccuracy) both as of the date of this Agreement and as of the Effective Time as if made at and as
of such time (other than any such representation or warranty that is made as of a specified date, which representation or
warranty shall be so true and correct as of such specified date), (ii) the representations and warranties of the Company
contained in Section 3.1(a), Section 3.3, Section 3.5(a)(i)(A), Section 3.26, Section 3.27
and Section 3.28 (without giving effect to any materiality, Company Material Adverse Effect or similar qualifiers
contained therein) shall be true and correct in all material respects both as of the date of this Agreement and as of the
Effective Time as if made at and as of the Effective Time (other than any such representation or warranty that is made as of
a specified date or time, which representation or warranty shall be so true and correct as of such specified date or time),
and (iii) the other representations and warranties of the Company contained in Article III of this Agreement (without
giving effect to any materiality, Company Material Adverse Effect or similar qualifiers contained therein) shall be true and
correct both as of the date of this Agreement and as of the Effective Time as if made at and as of the Effective Time (other
than any such representation or warranty that is made as of a specified date or time, which representation or warranty shall
be so true and correct as of such specified date or time), except where the failure of such representations and warranties to
be true and correct, individually or in the aggregate, has not had, and would not reasonably be expected to have, a Company
Material Adverse Effect;
(b) the
Company shall have performed or complied in all material respects with its covenants and agreements contained in this Agreement
to be performed or complied with on or prior to the Effective Time;
(c) since
the date of this Agreement, there shall not have been any effect, change, development, event, circumstance, occurrence, condition,
fact or state of facts that has had or would reasonably be expected to have, individually or in the aggregate, a Company Material
Adverse Effect;
(d) the
Company shall have delivered executed Preferred Stockholder Letters from each holder of Company Preferred Stock; and
(e) Parent
shall have received a certificate signed by an executive officer of the Company certifying as to the matters set forth in Section
6.2(a), Section 6.2(b), and Section 6.2(c).
Section
6.3 Conditions to the Obligations of the Company. The obligations of the Company to effect
the Merger and the other transactions contemplated by this Agreement is subject to the satisfaction or (to the extent permitted
by Law) waiver by the Company at or prior to the Effective Time of the following additional conditions:
(a) each
of the representations and warranties of Parent and Merger Sub contained in Article IV of this Agreement (without giving
effect to any materiality, Parent Material Adverse Effect or similar qualifiers contained therein) shall be true and correct both
as of the date of this Agreement and as of the Effective Time as though made on and as of the Effective Time (other than any such
representation or warranty that is made as of a specified date, which representation or warranty shall be so true and correct
as of such specified date), except where the failure of such representations and warranties to be true and correct, individually
or in the aggregate, has not had, and would not reasonably be expected to have, a Parent Material Adverse Effect;
(b) Parent
and Merger Sub shall have performed or complied in all material respects with each of their respective covenants and agreements
contained in this Agreement to be performed or complied with by it on or prior to the Effective Time; and
(c) the
Company shall have received a certificate signed by an executive officer of Parent certifying that the conditions set forth in
Section 6.3(a) and Section 6.3(b) have been satisfied.
Section
6.4 Frustration of Closing Conditions. Neither Parent or Merger Sub, on the one hand, nor
the Company, on the other hand, may rely on the failure of any condition set forth in Section 6.1, Section 6.2 or
Section 6.3, as the case may be, to be satisfied to excuse it from its obligation to effect the Merger if such failure
was caused by such party’s failure to comply with its obligations to consummate the Merger and the other transactions contemplated
by this Agreement to the extent required by this Agreement.
ARTICLE
VII
TERMINATION,
AMENDMENT AND WAIVER
Section
7.1 Termination. Notwithstanding anything contained in this Agreement to the contrary, this
Agreement may be terminated at any time prior to the Effective Time, whether before or after the Company Stockholder Approval
is obtained (except as otherwise expressly noted), as follows:
(a) by
mutual written consent of each of Parent and the Company; or
(b) by
either Parent or the Company:
(i) if
the Merger shall not have been consummated on or before 5:00 P.M. (New York City time) on August 7, 2020 (the
“Termination Date”); provided, however, that the right to terminate this Agreement pursuant
to this Section 7.1(b)(i) shall not be available to any party where the breach of or the failure to fulfill, perform
or comply with any of its obligations under this Agreement in any material respect, has been the principal cause of, or
principally resulted in, the failure of the Closing to have occurred on or before the Termination Date;
(ii) if
any Governmental Authority of competent jurisdiction shall have issued or entered any Order after the date of this Agreement or
any Law shall have been enacted or promulgated after the date of this Agreement that has the effect of permanently restraining,
enjoining or otherwise prohibiting the Merger or other transactions contemplated by this Agreement, and in the case of such an
Order, such Order shall have become final and non-appealable; provided, however, that the right to terminate this
Agreement under this Section 7.1(b)(ii) shall not be available to a party where the breach of or failure to fulfill, perform
or comply with any of its obligations under this Agreement, in any material respect, has been the principal cause of, or principally
resulted in, the issuance of such Order; or
(iii) if
the Company Stockholder Approval shall not have been obtained in accordance with the Certificate of Incorporation and DGCL, whether
(to the extent permitted) by written consent or at a duly convened Company Stockholders’ Meeting, or at any adjournment
or postponement thereof, at which a vote on the adoption of this Agreement was taken.
(c) by
the Company:
(i) if
Parent or Merger Sub shall have breached or failed to perform any of their respective representations, warranties, covenants or
other agreements set forth in this Agreement, which breach or failure to perform (A) would result in the failure of a condition
set forth in Section 6.3(a) or Section 6.3(b) and (B) is not capable of being cured by Parent or Merger Sub, as
applicable, by the Termination Date, or, if capable of being cured, shall not have been cured by Parent or Merger Sub on or before
the earlier of (1) the Termination Date and (2) the date that is thirty (30) calendar days following the Company’s delivery
of written notice to Parent of such breach or failure to perform; provided, however, that the Company shall not
have the right to terminate this Agreement pursuant to this Section 7.1(c)(i) if it is then in material breach of any of
its representations, warranties, covenants or agreements under this Agreement so as to result in the failure of a condition set
forth in Section 6.2(a) or Section 6.2(b); or
(ii) at
any time prior to receipt of the Company Stockholder Approval, in order to enter into a definitive agreement with respect to a
Company Superior Proposal, to the extent permitted by, and, subject to complying with the applicable terms and conditions of Section
5.5(d); provided, however, that immediately prior to or concurrently with such termination, the Company pays
to Parent the Company Termination Fee (it being understood that the Company may enter into such definitive written agreement concurrently
with the termination of this Agreement).
(d) by
Parent:
(i) if
the Company shall have breached or failed to perform any of its representations, warranties, covenants or other agreements set
forth in this Agreement, which breach or failure to perform (A) would result in the failure of a condition set forth in Section
6.2 and (B) is not capable of being cured by the Company by the Termination Date or, if capable of being cured, shall not
have been cured by the Company on or before the earlier of (1) the Termination Date and (2) the date that is thirty (30) calendar
days following Parent’s delivery of written notice to the Company of such breach or failure to perform; provided,
however, that Parent shall not have the right to terminate this Agreement pursuant to this Section 7.1(d)(i) if
Parent or Merger Sub is then in material breach of any of its representations, warranties, covenants or agreements under this
Agreement so as to result in the failure of a condition set forth in Section 6.3(a) or Section 6.3(b); or
(ii) on
or prior to the date of the Company Stockholders’ Meeting, if (A) the Company Board shall have made a Company Adverse Recommendation
Change or (B) the Company or the Company Board, as applicable, shall have materially breached any of its obligations under Section
5.5(a).
Section
7.2 Effect of Termination. In the event that this Agreement is terminated and the Merger abandoned
pursuant to Section 7.1, written notice thereof shall be given by the terminating party to the other party, specifying
the provisions hereof pursuant to which such termination is made, and this Agreement shall forthwith become null and void and
of no effect without liability on the part of any party hereto, and all rights and obligations of any party hereto shall cease;
provided, however, that no such termination shall relieve (a) any party hereto of any liability or damages resulting
from any material and intentional breach of this Agreement or fraud or (b) Parent or Merger Sub of any liability or damages resulting
from not having, for any reason, sufficient cash available on the date that the Closing is required to occur pursuant to Section
1.2 hereof to consummate the transactions contemplated hereby in accordance with the terms of this Agreement, in which case,
the aggrieved party shall be entitled to all remedies available at law or in equity; and provided, further, however,
that the Confidentiality Agreement, this Section 7.2, Section 7.3, and Article VIII shall survive any termination
of this Agreement pursuant to Section 7.1. For purposes of this Agreement, “material and intentional breach”
shall mean an action or omission taken or omitted to be taken that the breaching party intentionally takes (or fails to take)
and knows would, or knows would reasonably be expected to, cause a material breach of this Agreement.
Section
7.3 Termination Fees.
(a) If
this Agreement is terminated by:
(i)
(A) Parent pursuant to Section 7.1(d)(i) on the basis of a breach of a covenant or agreement contained in this Agreement
or (B) either Parent or the Company pursuant to Section 7.1(b)(i) or Section 7.1(b)(iii) and in any such termination
under clauses (A) or (B), (1) prior to such termination, a Company Acquisition Proposal made after the date of this Agreement
has been publicly disclosed and not publicly withdrawn or otherwise abandoned at least three (3) Business Days prior to the Company
Stockholders’ Meeting in the case of termination pursuant to Section 7.1(b)(iii) or is otherwise known to the Company
Board and not withdrawn (publicly, if publicly disclosed) prior to such termination in the case of termination pursuant to either
Section 7.1(b)(i) or Section 7.1(d)(i), and (2) within twelve (12) months after any such termination of this Agreement
(pursuant to the foregoing clauses (A) or (B)) the Company consummates a Company Acquisition Proposal with the party that made
such Company Acquisition Proposal (provided, however, that for purposes of this Section 7.3(a)(i), the references
to “fifteen percent (15%)” in the definition of Company Acquisition Proposal shall be deemed to be references to “fifty
percent (50%)”);
(ii) the
Company pursuant to Section 7.1(c)(ii); or
(iii) Parent
pursuant to Section 7.1(d)(ii);
then,
in any such case, the Company shall pay to Parent the Company Termination Fee.
Any
payments required to be made under this Section 7.3 shall be made by wire transfer of same-day funds to the account or
accounts designated by Parent, (1) in the case of clause (i) above, within five (5) Business Days, following the consummation
of the transaction contemplated therein, (2) in the case of clause (ii) above, immediately prior to or concurrently with such
termination and (3) in the case of clause (iii) above, promptly, but in no event later than two (2) Business Days after the date
of such termination.
(b) Notwithstanding
anything to the contrary set forth in this Agreement (i) the parties hereto agree that in no event shall the Company be required
to pay the Company Termination Fee on more than one occasion and (ii) following receipt by Parent of the Company Termination Fee
in accordance with this Section 7.3 as a result of a termination by Parent, the Company shall have no further liability
with respect to this Agreement or the transactions contemplated hereby to Parent or Merger Sub.
(c) The
Company acknowledges that (i) the agreements contained in this Section 7.3 are an integral part of the transactions contemplated
by this Agreement, and (ii) without these agreements, Parent would not enter into this Agreement. Accordingly, if the Company
fails to timely pay any amount due pursuant to this Section 7.3 and, in order to obtain such payment, Parent commences
a suit that results in a judgment against the Company for the payment of any amount set forth in this Section 7.3, the
Company shall pay Parent its costs and expenses in connection with such suit (including reasonable attorneys’ fees), together
with interest on such amount at an annual rate equal to the prime rate as published in The Wall Street Journal in effect on the
date such payment was required to be made through the date such payment was actually received, or such lesser rate as is the maximum
permitted by applicable Law.
Section
7.4 Amendment. This Agreement may be amended by mutual agreement of the parties hereto in
writing at any time before the Closing Date, whether before or after receipt of the Company Stockholder Approval; provided,
however, that after the Company Stockholder Approval has been obtained, no amendment may be made that either by applicable
Law or pursuant to the applicable rules of any applicable stock exchange requires further approval by the stockholders of the
Company without such further approval of such stockholders having been obtained.
Section
7.5 Extension; Waiver. At any time prior to the Effective Time, subject to applicable Law,
any party hereto may (a) extend the time for the performance of any obligation or other act of any other party hereto, (b) waive
any inaccuracy in the representations and warranties of the other party contained herein or in any document delivered pursuant
hereto and (c) waive compliance by any other party hereto with any agreement or condition of such party contained herein. Any
such extension or waiver shall only be valid if set forth in an instrument in writing signed by the party or parties to be bound
thereby. Notwithstanding the foregoing, no failure or delay by the Company, Parent or Merger Sub in exercising any right hereunder
shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise of any
other right hereunder.
ARTICLE
VIII
GENERAL
PROVISIONS
Section
8.1 Non-Survival of Representations and Warranties. The representations and warranties in
this Agreement and any certificate delivered pursuant hereto by any Person shall terminate at the Effective Time, and only the
covenants that by their terms survive the Effective Time shall so survive the Effective Time in accordance with their respective
terms.
Section
8.2 Expenses. Except as expressly set forth herein (including Section 7.3), all fees,
costs and expenses (including all legal, accounting, broker, finder or investment banker fees) incurred in connection with this
Agreement and the transactions contemplated by this Agreement shall be paid by the party incurring such expenses, whether or not
the Merger and the transactions contemplated by this Agreement are consummated.
Section
8.3 Notices. All notices, consents and other communications hereunder shall be in writing
and shall be given (and shall be deemed to have been duly given upon receipt) by hand delivery, by prepaid overnight courier (providing
written proof of delivery) or by confirmed electronic mail, addressed as follows:
if
to Parent or Merger Sub:
Siemens Medical Solutions USA, Inc.
Address:
40 Liberty Blvd., Malvern, PA 19355
Attention:
General Counsel
Email:
kevin.royer@siemens-healthineers.com
with
a copy (which shall not constitute notice) to:
Blank Rome LLP
1271 Avenue of the Americas
New York, NY 10020
Attention: Gary Goldenberg; Alan Lieblich; Shaun Snitman
Email:
goldenberg@blankrome.com; lieblich@blankrome.com; ssnitman@blankrome.com
if
to the Company:
Corindus
Vascular Robotics
309 Waverley Oaks Road, Suite 105
Waltham, MA 02452
Attention: Mark J. Toland
Email: mark.toland@corindus.com
with
a copy (which shall not constitute notice) to:
Cadwalader,
Wickersham & Taft LLP
One World Financial Center
New York, NY 10281
Attention: Christopher Cox; William P. Mills; Gregory P. Patti
Email: chris.cox@cwt.com; william.mills@cwt.com; greg.patti@cwt.com
or
to such other address or electronic mail address for a party as shall be specified in a notice given in accordance with this Section
8.3; provided, however, that any notice received by electronic mail or otherwise at the addressee’s location
on any Business Day after 5:00 P.M. (addressee’s local time) or on any day that is not a Business Day shall be deemed to
have been received at 9:00 A.M. (addressee’s local time) on the next Business Day; provided, further, however,
that notice of any change to the address or any of the other details specified in or pursuant to this Section 8.3 shall
not be deemed to have been received until, and shall be deemed to have been received upon, the later of the date specified in
such notice or the date that is five (5) Business Days after such notice would otherwise be deemed to have been received pursuant
to this Section 8.3.
Section
8.4 Interpretation; Certain Definitions.
(a) The
parties hereto have participated collectively in the negotiation and drafting of this Agreement. In the event an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed as if drafted collectively by the parties hereto,
and no presumption or burden of proof shall arise favoring or disfavoring any party by virtue of the authorship of any provisions
of this Agreement.
(b) The
words “hereof,” “herein,” “hereby,” “hereunder” and “herewith” and
words of similar import shall refer to this Agreement as a whole and not to any particular provision of this Agreement. References
to articles, sections, paragraphs, exhibits, annexes and schedules are to the articles, sections and paragraphs of, and exhibits,
annexes and schedules to, this Agreement, unless otherwise specified, and the table of contents and headings 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 phrase “without limitation.” Words describing the singular number shall be deemed to include
the plural and vice versa, words denoting any gender shall be deemed to include all genders, words denoting natural persons shall
be deemed to include business entities and vice versa, and references to a Person are also to its permitted successors and assigns.
The term “or” is not exclusive. The word “extent” in the phrase “to the extent” shall mean
the degree to which a subject or other thing extends, and such phrase shall not mean simply “if.” The phrases “the
date of this Agreement” and “the date hereof” and terms or phrases of similar import shall be deemed to refer
to August 6, 2019, unless the context requires otherwise. References to any information or document being “made available”
or “furnished” and words of similar import shall include such information or document having been posted to the “Corindus
Financing” online data room hosted on behalf of the Company by Intralinks Inc. by 11:59 pm New York City time on the day
prior to the date of this Agreement. Terms defined in the text of this Agreement have such meaning throughout this Agreement,
unless otherwise indicated in this Agreement, and all terms defined in this Agreement shall have the meanings when used in any
certificate or other document made or delivered pursuant hereto unless otherwise defined therein. Any Law defined or referred
to herein or in any agreement or instrument that is referred to herein means such Law as from time to time amended, modified or
supplemented, including (in the case of statutes) by succession of comparable successor Laws (provided, however,
that for purposes of any representations and warranties contained in this Agreement that are made as of a specific date or dates,
references to any statute shall be deemed to refer to such statute, as amended, and to any rules or regulations promulgated thereunder,
in each case, as of such date). All references to “dollars” or “$” refer to currency of the United States.
Section
8.5 Severability. If any term, provision, covenant or restriction of this Agreement is held
by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, all other terms, provisions, covenants
and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated.
Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto
shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties hereto as closely as
possible in a mutually acceptable manner in order that the Merger be consummated as originally contemplated to the fullest extent
possible.
Section
8.6 Assignment. Neither this Agreement nor any of the rights, interests or obligations hereunder
shall be assigned by any of the parties hereto (whether by operation of Law or otherwise) without the prior written consent of
the other parties hereto, except that Merger Sub may assign any or all of its rights, interests and obligations hereunder to (a)
one or more direct or indirect wholly owned Subsidiaries of Parent, or a combination thereof, so long as such assignment would
not have a Parent Material Adverse Effect and no such assignment shall release Parent or Merger Sub, as the case may be, from
any of its obligations hereunder and (b) as collateral security to any lenders or financing sources (as agent or trustee therefor)
to Parent or its Affiliates in connection with any bona fide financing arrangement (but no such assignment shall release Parent
or Merger Sub, as the case may be, from any of its obligations hereunder). Subject to the preceding sentence, this Agreement will
be binding upon, inure to the benefit of and be enforceable by the parties hereto and their respective permitted successors and
assigns. Any attempted assignment in violation of this Section 8.6 shall be null and void.
Section
8.7 Entire Agreement. This Agreement (including the exhibits, annexes and appendices hereto)
constitutes, together with the Voting and Support Agreement, the Confidentiality Agreement and the Company Disclosure Letter,
the entire agreement, and supersedes all other prior agreements and understandings, both written and oral, among the parties hereto,
or any of them, with respect to the subject matter hereof.
Section
8.8 No Third-Party Beneficiaries. This Agreement is not intended to and shall not confer upon
any Person other than the parties hereto any rights or remedies hereunder; provided, however, that it is specifically
intended that (a) the D&O Indemnified Parties (with respect to Section 5.6 and this Section 8.8 from and after
the Effective Time) are intended third-party beneficiaries hereof and (b) from and after the Effective Time, the holders of Company
Common Stock, Company Preferred Stock, Company Warrants and Company Equity Awards are intended third-party beneficiaries of Article
II.
Section
8.9 Governing Law. This Agreement and all Proceedings (whether based on contract, tort or
otherwise) arising out of or relating to this Agreement or the actions of Parent, Merger Sub or the Company in the negotiation,
administration, performance and enforcement thereof, shall be governed by, and construed in accordance with, the Laws of the State
of Delaware, without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware or any
other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of Delaware.
Section
8.10 Specific Performance. The parties hereto agree that irreparable damage for which monetary
damages, even if available, would not be an adequate remedy would occur in the event that any party hereto does not perform the
provisions of this Agreement (including failing to take such actions as are required of it hereunder to consummate this Agreement)
in accordance with its specified terms or otherwise breaches such provisions. Accordingly, the parties hereto acknowledge and
agree that, prior to any valid termination of this Agreement in accordance with Section 7.1, in the event of any breach
or threatened breach by the Company, on the one hand, or Parent or Merger Sub, on the other hand, of any of their respective covenants
or obligations set forth in this Agreement, the Company, on the one hand, and Parent and Merger Sub, on the other hand, shall
be entitled to an injunction, specific performance and other equitable relief to prevent breaches or threatened breaches of this
Agreement and to enforce specifically the terms and provisions hereof, in addition to any other remedy to which they are entitled
at law or in equity. Each of the parties hereto agrees that, prior to any valid termination of this Agreement in accordance with
Section 7.1, it will not oppose the granting of an injunction, specific performance and other equitable relief on the basis
that any other party has an adequate remedy at law or that any award of specific performance is not an appropriate remedy for
any reason at law or in equity. Any party hereto seeking an injunction or injunctions to prevent breaches or threatened breaches
of this Agreement and to enforce specifically the terms and provisions of this Agreement shall not be required to provide, furnish
or post any bond or other security in connection with any such order or injunction, and each party hereby irrevocably waives any
right it may have to require the provision, furnishing or posting of any such bond or other security.
Section
8.11 Consent to Jurisdiction.
(a) Each
of the parties hereto hereby, with respect to any legal claim or Proceeding arising out of this Agreement or the transactions
contemplated by this Agreement, (i) expressly and irrevocably submits, for itself and with respect to its property, generally
and unconditionally, to the exclusive jurisdiction of the Delaware Court of Chancery and any appellate court therefrom within
the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular matter, any state
or federal court within the State of Delaware), (ii) agrees that it will not attempt to deny or defeat such personal jurisdiction
by motion or other request for leave from any such courts, (iii) agrees that it will not bring any claim or Proceeding relating
to this Agreement or the transactions contemplated by this Agreement except in such courts and (iv) irrevocably waives, to the
fullest extent it may legally and effectively do so, and agrees not to assert, by way of motion or as a defense, counterclaim
or otherwise, any objection which it may now or hereafter have to the laying of venue of any claim or Proceeding arising out of
or relating to this Agreement. Notwithstanding the foregoing, each of Parent, Merger Sub and the Company agrees that a final and
nonappealable judgment in any Proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment
or in any other manner provided by Law.
(b) Each
party hereto irrevocably consents to the service of process in any claim or Proceeding with respect to this Agreement and the
transactions contemplated by this Agreement or for recognition and enforcement of any judgment in respect hereof brought by any
other party hereto made by mailing copies thereof by registered or certified United States mail, postage prepaid, return receipt
requested, to its address as specified in or pursuant to Section 8.3, and such service of process shall be sufficient to
confer personal jurisdiction over such party in such claim or Proceeding and shall otherwise constitute effective and binding
service in every respect.
Section
8.12 Counterparts. This Agreement may be executed in multiple counterparts, all of which shall
together be considered one and the same agreement. Delivery of an executed signature page to this Agreement by electronic transmission
shall be as effective as delivery of a manually signed counterpart of this Agreement.
Section
8.13 WAIVER OF JURY TRIAL. EACH OF PARENT, MERGER SUB AND THE COMPANY HEREBY IRREVOCABLY
WAIVES ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) BETWEEN
ANY OF THEM DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF PARENT, MERGER SUB OR THE COMPANY
IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE AND ENFORCEMENT THEREOF.
Section
8.14 Definitions.
(a) As
used in this Agreement, the following terms shall have the following meanings:
“Acceptable
Confidentiality Agreement” shall mean any customary confidentiality agreement that (a) does not contain any provision
prohibiting or otherwise restricting the Company’s ability to comply with any of the terms of this Agreement and (b) contains
provisions that are no less favorable in the aggregate to the Company, or less restrictive to such third Person in the aggregate
(in comparison to Parent), than those contained in the Confidentiality Agreement (provided, however, that such agreement
need not contain any standstill agreement or similar obligation).
“Affiliate”
shall mean, with respect to any Person, any individual, partnership, corporation, entity or other Person that directly, or indirectly
through one or more intermediaries, Controls, is Controlled by, or is under common Control with, the first Person specified.
“Aggregate
Merger Consideration” shall mean the aggregate Merger Consideration to which all holders of Company Stock collectively
become entitled pursuant to Section 2.1(a)(i) and Section 2.1(a)(ii).
“Business
Day” shall mean any day other than a Saturday, Sunday or a day on which all banking institutions in New York, New York
are authorized or obligated by Law or executive order to close.
“Code”
shall mean the Internal Revenue Code of 1986, as amended.
“Company
Acquisition Proposal” shall mean a proposal or offer (whether or not in writing) from any Person (other than Parent
or any of its Subsidiaries) relating to, or that would reasonably be expected to lead to (in one transaction or a series of transactions),
any (a) merger, consolidation, share exchange, business combination, recapitalization, reorganization, dissolution, liquidation,
joint venture or similar transaction involving the Company or any Subsidiary of the Company, pursuant to which any Person or group
of related Persons would beneficially own or control, directly or indirectly, fifteen percent (15%) or more (on a non-diluted
basis) of any class of equity or voting Securities of the Company or any resulting parent company of the Company, (b) sale, lease,
license or other disposition, directly or indirectly, of assets of the Company (including capital stock or other equity interests
of any of its Subsidiaries) or any Subsidiary of the Company, in each case, representing in the aggregate fifteen percent (15%)
or more of the consolidated assets, net revenues or net income of the Company and its Subsidiaries taken as a whole, (c) issuance
or sale or other disposition of capital stock or other equity interests representing fifteen percent (15%) or more (on a non-diluted
basis) of any class of equity or voting Securities of the Company, (d) tender offer, exchange offer or any other transaction or
series of transactions that, if consummated, would result in any Person or group of related Persons, directly or indirectly, beneficially
owning or having the right to acquire beneficial ownership of capital stock or other equity interests representing fifteen percent
(15%) or more (on a non-diluted basis) of any class of equity or voting Securities of the Company or (e) a combination of the
foregoing.
“Company
Certificate of Designation” shall mean the Certificate of Designation of Preferences, Rights and Limitations of the
Series A Convertible Preferred Stock and Series A-1 Convertible Preferred Stock of the Company, as amended from time to time.
“Company
Common Stock” shall mean the common stock of the Company, par value $0.0001 per share.
“Company
Disclosure Letter” shall mean the disclosure letter delivered by the Company to Parent and Merger Sub simultaneously
with the execution of this Agreement.
“Company
Equity Awards” shall mean the Company Options and the Company RSU Awards.
“Company
Equity Plans” shall mean, collectively: the Company’s Amended and Restated 2014 Stock Award Plan and the Company’s
2018 Stock Award Plan, as amended from time to time.
“Company
Intellectual Property” shall mean (a) any and all Intellectual Property owned by, or purported to be owned by, the Company
or any of its Subsidiaries and (b) any and all Intellectual Property licensed to, or otherwise used by (with a valid right to
use), the Company or any of its Subsidiaries, in each case of (a) and (b), whether registered or unregistered.
“Company
Intervening Event” shall mean any effect, change, development, event, occurrence or circumstance that is material to
the Company and its Subsidiaries, taken as a whole, that was not known to the Company Board on the date of this Agreement (or
if known, the material consequences of which were not known to the Company Board as of the date of this Agreement), which effect,
change, development, event, occurrence or circumstance, or any consequence thereof, becomes known to the Company Board prior to
the Company Stockholder Approval and did not result from or arise out of the announcement or pendency of, or any actions required
to be taken by the Company (or to be refrained from being taken by the Company) pursuant to, this Agreement; provided,
however, that in no event shall the following events, circumstances, or changes in circumstances constitute an Intervening
Event: (a) the receipt, existence, or terms of a Company Acquisition Proposal or any matter relating thereto or consequence thereof
or any inquiry, proposal, offer, or transaction from any third party relating to or in connection with a transaction of the nature
described in the definition of “Company Acquisition Proposal” (which, for the purposes of the Intervening Event definition,
shall be read without reference to the percentage thresholds set forth in the definition thereof); (b) any change in the price,
or change in trading volume, of the Company Common Stock (provided, however, that the exception to this clause (b) shall not apply
to the underlying causes giving rise to or contributing to such change or prevent any of such underlying causes from being taken
into account in determining whether an Intervening Event has occurred).
“Company
Licensed IP” shall mean all Company Intellectual Property that is licensed to, or otherwise used by (with a valid right
to use), the Company or any of its Subsidiaries, whether registered or unregistered.
“Company
Material Adverse Effect” shall mean any effect, change, development, event, circumstance, occurrence, condition, fact
or state of facts that has a material adverse effect, individually or in the aggregate, (a) on the business, condition (financial
or otherwise) or results of operations of the Company and its Subsidiaries, taken as a whole; provided, however,
that any effect, change, development, event, circumstance, occurrence, condition or state of facts directly resulting from, attributable
to or arising out of the following will not be taken into account in determining whether a Company Material Adverse Effect has
occurred: (i) changes in general United States or other national, regional or global economic, regulatory, legislative, credit,
capital market or financial market conditions; (ii) changes in the economic, business and financial environment generally affecting
the medical device industry; (iii) any change in the Company’s trading volume or stock price, (iv) in and of itself, any
failure by the Company to meet any revenue, earnings or other similar projections (it being understood that the underlying effect,
change, development, event, circumstance, occurrence, condition, fact or state of facts giving rise to or contributing to such
change or failure may be taken into account in determining whether there has been a Company Material Adverse Effect to the extent
not otherwise excluded by another exception herein); (v) an act of terrorism or sabotage or an outbreak or escalation of hostilities
or war (whether or not declared) or any natural disasters, national emergencies or other force majeure events, including any escalation
or worsening of such conditions threatened or existing as of the date of this Agreement; (vi) adoption, implementation, enforcement,
promulgation, repeal, modification, amendment interpretation or other changes in applicable Law or GAAP or any regulatory environment
or regulatory enforcement environment; (vii) the execution, public announcement or pendency of this Agreement and the anticipated
consummation of the Merger or the other transactions contemplated hereby, including (A) the identity of Parent or the announcement
by Parent or any of its Affiliates of its or their plans or intentions with respect to the Company, (B) any departure or termination
of any officers, directors, employees or independent contractors of the Company or any of its Subsidiaries or (C) the termination
or potential termination of (or the failure or potential failure to renew or enter into) any Contracts with, or any other adverse
development (or potential adverse development) in the Company’s relationships with any of its customers, suppliers, distributors,
partners or other business relationships of the Company, or any litigation arising from allegations of any breach of fiduciary
duty or violation of Law relating to the Merger or this Agreement; (viii) any action expressly required to be taken pursuant to
this Agreement; or (ix) any action taken at the express written direction of Parent given after the date hereof; provided,
further, however, that if the effects, changes, developments, events, circumstances, occurrences, conditions, facts
or states of facts set forth in clauses (i), (ii), (v) and (vi), have a disproportionate impact on the Company and its Subsidiaries,
taken as a whole, relative to the other participants in the medical device industry, such effects, changes, developments, events,
circumstances, occurrences, conditions, facts or states of facts may be taken into account in determining whether a Company Material
Adverse Effect has occurred to the extent of such disproportionate impact or (b) on the ability of the Company to perform its
obligations under this Agreement or to consummate the Merger and the other transactions contemplated by this Agreement.
“Company
Option” shall mean each option to purchase shares of Company Common Stock, including any such option granted pursuant
to a Company Equity Plan.
“Company
Owned IP” shall mean all Intellectual Property that is owned or purported to be owned by the Company or any of its Subsidiaries,
whether registered or unregistered.
“Company
Recommendation” shall mean the recommendation of the Company Board that the stockholders of the Company adopt this Agreement
and approve the transactions contemplated by this Agreement, including the Merger.
“Company
Registered IP” shall mean all Company Owned IP that has been registered, filed, certified or otherwise perfected or
recorded with or by any Governmental Authority or domain name registrar, including the United States Patent and Trademark Office,
the United States Copyright Office, or in any like foreign or international office or agency, or any applications for any of the
foregoing.
“Company
RSU Award” shall mean each award of restricted stock unit covering shares of Company Common Stock, including any such
restricted stock unit granted pursuant to a Company Equity Plan.
“Company
Stock” shall mean, collectively, Company Common Stock and Company Preferred Stock.
“Company
Superior Proposal” shall mean a bona fide written Company Acquisition Proposal made after the date of this Agreement
(provided, however, that for purposes of this definition, references to fifteen percent (15%) in the definition
of “Company Acquisition Proposal” shall be deemed to be references to fifty percent (50%)) that did not result from
a breach of Section 5.5 and is on terms that the Company Board determines in good faith, after consultation with the Company’s
financial advisor and outside legal counsel, (a) to be reasonably likely to be consummated if accepted and (b) to be more favorable
to the holders of Company Common Stock from a financial point of view than the Merger and the other transactions contemplated
by this Agreement, in each case of clause (a) and (b), taking into account at the time of determination all legal, financial,
regulatory and other aspects or conditions of such Company Acquisition Proposal as the Company Board (or a duly authorized committee
thereof) considers to be relevant or appropriate (including any financing requirements and the ability of the Person making such
proposal to consummate the transactions contemplated by such proposal) and of this Agreement and any proposed amendments or modifications
to the terms of this Agreement offered by Parent in response to such Company Acquisition Proposal pursuant to Section 5.5(d).
“Company
Termination Fee” shall mean $32,515,000.
“Company
Warrants” shall mean all outstanding warrants to purchase shares of Company Common Stock.
“Confidentiality
Agreement” shall mean that certain Mutual Non-Disclosure Agreement, dated July 5, 2018, between Parent and the Company,
to the extent amended and modified by the applicable provisions of that certain letter, dated July 26, 2019, between Parent and
the Company.
“Contract”
shall mean, in each case, whether written or oral, any legally binding contract, agreement, assignment, subcontract, binding arrangement,
lease, sublease, conditional sales contract, purchase order, sales order, license, indenture, note, bond, loan, understanding,
undertaking, permit, concession, franchise, commitment, partnership, limited liability company or other agreement or other binding
instrument.
“Control”
shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies
of a Person, whether through the ownership of voting Securities or partnership or other interests, by Contract or otherwise. For
purposes of this definition, a general partner or managing member of a Person shall always be considered to Control such Person.
The terms “Controlling” and “Controlled” shall have correlative meanings.
“Copyrights”
shall mean all rights in copyrightable works, mask works, works of authorship and moral rights, including copyrights in Software,
and all other rights corresponding thereto throughout the world, whether published or unpublished, and any registrations or applications
for any of the foregoing, including renewals and extensions.
“Customs
& International Trade Authorizations” shall mean any and all licenses, registrations, and approvals required pursuant
to the Customs & International Trade Laws for the lawful export, re-export, transfer or import of goods, software, technology,
technical data, and services and international financial transactions.
“Customs
& International Trade Laws” shall mean the applicable export control, sanctions, import, customs and trade, anti-bribery,
and anti-boycott Laws of any jurisdiction in which the Company or any of its Subsidiaries is incorporated or does business, including
the UK Bribery Act 2010, the Tariff Act of 1930, as amended, and other Laws, regulations, and programs administered or enforced
by the U.S. Department of Commerce, U.S. International Trade Commission, U.S. Customs and Border Protection, U.S. Immigration
and Customs Enforcement, and their predecessor agencies; the Export Control Reform Act of 2018; the Export Administration Regulations,
including related restrictions with regard to transactions involving Persons on the U.S. Department of Commerce Denied Persons
List, Unverified List or Entity List; the Arms Export Control Act, as amended; the International Traffic in Arms Regulations,
including related restrictions with regard to transactions involving Persons on the Debarred List; the International Emergency
Economic Powers Act, as amended; the Trading With the Enemy Act, as amended; the Iran Sanctions Act, as amended; the National
Defense Authorization Act for Fiscal Years 2012 - 2018; and the embargoes and restrictions administered by OFAC; Executive Orders
regarding embargoes and restrictions on transactions with designated countries and entities, including Persons designated on OFAC’s
list of Specially Designated Nationals and Blocked Persons, and Persons designated on the U.S. Department of State sanctions lists;
the anti-boycott Laws and regulations administered by the U.S. Department of Commerce; and the anti-boycott Laws and regulations
administered by the U.S. Department of the Treasury.
“Delaware
Secretary of State” shall mean the Secretary of State of the State of Delaware.
“Device
Laws” shall mean all Laws related to health care or medical devices applicable to the operation of the Company’s
and each of its Subsidiaries’ business, including (a) the Federal Food, Drug, and Cosmetic Act of 1938, as amended (21 U.S.C.
§ 321 et seq.); (b) the rules and regulations promulgated and enforced by the FDA, including those requirements relating
to quality systems, good manufacturing practices, good laboratory practices, good clinical practices, good tissue practices, medical
device reporting, corrections and removals, development, distribution, import, export, establishment registration, investigational
use, labeling, promotion, security, and pre-market review; and (c) all comparable state, federal or foreign Laws relating to any
of the foregoing.
“Environmental
Laws” shall mean all applicable and legally enforceable Laws relating to pollution or protection of the environment,
natural resources, or human health and safety (as affected by exposure to Hazardous Materials), including Laws relating to Releases
of or exposure to Hazardous Materials and the manufacture, processing, distribution, use, treatment, storage, Release, transport
or handling of Hazardous Materials, including the Federal Water Pollution Control Act (33 U.S.C. § 1251 et seq.), the Resource
Conservation and Recovery Act of 1976 (42 U.S.C. § 6901 et seq.), the Safe Drinking Water Act (42 U.S.C. § 3000(f) et
seq.), the Toxic Substances Control Act (15 U.S.C. § 2601 et seq.), the Clean Air Act (42 U.S.C. § 7401 et seq.), the
Oil Pollution Act of 1990 (33 U.S.C. § 2701 et seq.), the Comprehensive Environmental Response, Compensation and Liability
Act of 1980 (42 U.S.C. § 9601 et seq.), the Endangered Species Act of 1973 (16 U.S.C. § 1531 et seq.), and other similar
foreign, state and local statutes, in effect as of the date of this Agreement.
“ERISA
Affiliate” shall mean each trade or business, whether or not incorporated, that, together with the Company or any of
its Subsidiaries, would be deemed a “single employer” within the meaning of Section 4001(b) of ERISA or Section 414
of the Code.
“Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
“Existing
Credit Agreement” shall mean that certain Loan and Security Agreement (Revolving Line) dated as of March 16, 2018, among
Silicon Valley Bank, the Company and Corindus, Inc. and that certain Loan and Security Agreement (Term Loan) dated as of March
16, 2018, among Silicon Valley Bank, Solar Capital Ltd., the Company, Corindus, Inc. and the lender parties thereto, as amended
by the First Amendment to Loan and Security Agreement (Term Loan) dated as of March 14, 2019, among Silicon Valley Bank, Solar
Capital Ltd., the Company, Corindus, Inc. and the lender parties thereto.
“FCPA”
shall mean the U.S. Foreign Corrupt Practices Act of 1977, as amended.
“GAAP”
shall mean the United States generally accepted accounting principles.
“Governmental
Authority” shall mean any United States (federal, state or local) or foreign government, or any governmental, regulatory,
judicial or administrative authority, agency or commission.
“Hazardous
Materials” shall mean any material, substance, chemical or waste (or combination thereof) that (a) is listed, defined,
designated, regulated or classified as hazardous, toxic, radioactive, dangerous, a pollutant, a contaminant, petroleum, oil or
words of similar meaning or effect under any Law relating to pollution, waste or protection of the environment or (b) can form
the basis of any liability under any Law relating to pollution, waste or protection of the environment.
“HSR
Act” shall mean the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations
thereunder.
“Indebtedness”
shall mean (a) any indebtedness or other obligation for borrowed money, whether current, short term or long term and whether secured
or unsecured, (b) any indebtedness evidenced by a note, bond, debenture or other Security or similar instrument, (c) any liabilities
or obligations with respect to interest rate swaps, collars, caps and similar hedging obligations, (d) any capitalized lease obligations,
(e) any direct or contingent obligations under letters of credit, bankers’ acceptances, bank guarantees, surety bonds and
similar instruments, each to the extent drawn upon and paid, (f) any obligation to pay the deferred purchase price of property
or services (other than trade accounts payable in the ordinary course of business) and (g) guarantees in respect of clauses (a)
through (f), including guarantees of another Person’s Indebtedness or any obligation of another Person which is secured
by assets of the Company or any of its Subsidiaries.
“Intellectual
Property” shall mean all intellectual property rights, intangible industrial property rights, invention and design rights,
and all related priority rights protected, conceived, created or arising under the Laws of the United States or any other jurisdiction
or under any international convention, including all Patents, Trademarks, Copyrights, Trade Secrets, and Software, all copies
of tangible embodiments of the foregoing (in whatever form or medium) and any rights equivalent to any of the foregoing anywhere
in the world.
“Intellectual
Property Agreement” shall mean any license-in, license-out, purchasing-in, purchasing-out, assignment, consent to use,
covenant not to sue, non-assertion, coexistence, settlement or similar Contract concerning (a) Intellectual Property that is material
to the Company or its Subsidiaries, (b) Company Owned IP, or (c) Software used by the Company or any of its Subsidiaries, other
than commercially available, non-customized, off-the-shelf software subject to “shrink-wrap” or “click-through”
type terms and available to the Company or any of its Subsidiaries, as applicable, at a cost of less than $100,000 per annum.
Without limiting the generality of the foregoing, the following Contracts to which the Company or any of its Subsidiaries is a
party, if any, shall be included in the definition of “Intellectual Property Agreement”: (i) each Contract pursuant
to which any Intellectual Property has been or will be developed by a third Person, either solely by such third Person or jointly
with the Company or any of its Subsidiaries, for the benefit of the Company or any of its Subsidiaries; (ii) each Contract pursuant
to which the Company or any of its Subsidiaries purchased, sold, transferred, or acquired, or will purchase, sell, transfer, or
acquire, any Intellectual Property; and (iii) each Contract pursuant to which any Company Owned IP is subject to a Lien or other
restriction, other than a Permitted Lien.
“IRS”
shall mean the United States Internal Revenue Service.
“Knowledge”
shall mean the actual knowledge of each of the officers and employees of the Company set forth on Section 8.14 of the Company
Disclosure Letter.
“Law”
shall mean any domestic, federal, state, municipal, local, national, supranational, foreign or other statute, law (whether statutory
or common law), constitution, code, ordinance, rule, administrative interpretation, regulation, Order, writ, judgment, decree,
directive (including those of any self-regulatory organization), arbitration award, agency requirement, license, permit or any
other enforceable requirement of any Governmental Authority.
“Lien”
shall mean any liens, covenants, charges, security interests, options, claims, mortgages, pledges, encumbrances or other restrictions
of any nature whatsoever.
“Merger
Consideration” shall mean, as applicable, the Common Stock Consideration or the Preferred Stock Consideration.
“Notified
Body” means an entity licensed, authorized or approved by the applicable Governmental Authority to assess and certify
the conformity of a medical device with the requirements of Council Directive 93/42/EEC of 14 June 1993 concerning medical devices,
as amended from time to time, and applicable harmonized standards.
“NYSE
American” shall mean The NYSE American LLC or any successor that is a national securities exchange registered under
Section 6 of the Exchange Act.
“OFAC”
shall mean the Office of Foreign Assets Control of the U.S. Department of the Treasury.
“Order”
shall mean any decree, order, settlement, consent, stipulation, judgment, injunction, writ, award, temporary restraining order
or other order in any Proceeding by or with any Governmental Authority.
“Parent
Common Stock” shall mean the common stock, par value $1.00 per share, of Parent.
“Parent
Organizational Documents” shall mean the certificate of incorporation and bylaws, each as amended as of the date of
this Agreement, of each of Parent and Merger Sub.
“Patents”
shall mean all issued letters or design patents, reissued or reexamined patents, patents surviving inter partes review,
revival of patents, utility models, registered community designs, registered industrial designs, certificates of invention, registrations
of patents and extensions thereof, supplemental protection certificates regardless of country issued or formal name and all published
or unpublished non-provisional and provisional patent applications, reissue applications, reexamination proceedings, invention
disclosures and records of invention, continuation applications, continuation-in-part applications, requests for continued examination
and divisions, divisional applications, patent term extension applications, applications for supplemental protection certificates,
all rights in respect of utility models and certificates of invention, and all rights and priorities and all extensions and renewals
thereof, regardless of the country filed or formal name.
“Permitted
Lien” shall mean (a) Liens for Taxes, utilities or governmental assessments, charges or claims of payment (i) not yet
due and payable or (ii) that are being contested in good faith and by appropriate proceedings and for which adequate reserves
have been maintained in accordance with GAAP; (b) suppliers’, workers’, mechanics’, materialmen’s or other
similar liens arising by operation of Law or otherwise incurred in the ordinary course of business consistent with past practice;
(c) Liens arising under equipment leases with third Persons entered into in the ordinary course of business consistent with past
practice; (d) any other Liens if the underlying obligations are non-monetary and do not, individually or in the aggregate, (A)
materially impair the continued use and operation of the assets of the Company and its Subsidiaries to which they relate in the
conduct of the business of the Company and its Subsidiaries, taken as a whole, as currently conducted or (B) in the case of Liens
with respect to Parent and its Subsidiaries, do not, individually or in the aggregate, materially impair the continued use and
operation of the assets of Parent and its Subsidiaries to which they relate in the conduct of the business of Parent and its Subsidiaries,
taken as a whole, as currently conducted; (e) Liens in favor of customs and revenue authorities arising as a matter of Law and
in the ordinary course of business to secure payment of customs duties in connection with the importation of goods; (f) Liens
resulting from securities Laws on Securities of the Company or its Subsidiaries; (g) Liens incurred in connection with the Existing
Credit Agreement; (h) Liens created by Parent, Merger Sub or any of their respective Affiliates; and (i) with respect to real
property and improvements, zoning regulations, building codes and other land use regulations or environmental regulations, ordinances
or legal requirements or similar laws imposed by any Governmental Authority (excluding liens imposed by applicable Environmental
Laws related to the investigation or remediation of contaminated real property), to the extent not violated by the Company’s
or any of its Subsidiaries’ current use of such real property (or in the case of Liens with respect to Parent or any of
its Subsidiaries, to the extent not violated by Parent’s or any of its Subsidiaries’ current use of such real property);
and (j) in connection with any real property leased to the Company, all title exceptions, defects, easements, restrictions and
other matters encumbering landlord’s interest in such real property, whether or not of record, which do not, individually
or in the aggregate, materially affect the continued use and operation of the applicable property in the conduct of the business
of the Company and its Subsidiaries as currently conducted.
“Person”
shall mean an individual, a corporation, a limited liability company, a partnership, an association, a trust or any other entity
or organization, including a Governmental Authority.
“Personal
Information” means any information that (a) identifies or can reasonably be used by the intended recipient to identify
an individual, (b) is regulated by any Data Protection Law, or (c) is considered identifiable under the Company’s or any
of its Subsidiaries’ privacy or security policies or procedures, or written agreements to which the Company or any of its
Subsidiaries is a party.
“Proceedings”
shall mean legal, civil, criminal, administrative, regulatory, arbitral, enforcement, civil penalty, alternative dispute resolution,
debarment, seizure or other proceedings, litigation, suits, actions, charges, complaints, subpoenas, prosecutions, claims, audits,
assessments, inquiries or investigations (other than internal inquiries or investigations).
“Registrations”
shall mean authorizations, approvals, clearances, consents, licenses, permits, certificates, exemptions or registrations issued
or otherwise made available by any Regulatory Authority or Governmental Authority (including 510(k) pre-market notification clearances,
de novo classifications, pre-market approvals, investigational device exemptions, product recertifications, manufacturing approvals
and authorizations, CE Marks, pricing and reimbursement approvals, labeling approvals, registration notifications or their foreign
equivalent) that are required for the research, investigation, development, production, manufacture, labeling, distribution, marketing,
storage, shipping, transportation, export, import, use or sale of the products or services of the Company and any of its Subsidiaries.
“Regulatory
Authority” shall mean the FDA and any other Governmental Authority that regulates the research, investigation, development,
production, marketing, distribution, storage, shipping, transport, advertising, labeling, promotion, sale, export, import, use,
handling and control, safety, efficacy, reliability or manufacturing of medical devices, and any Notified Body.
“Release”
shall mean any release, spill, emission, discharge, leaking, pumping, injection, deposit, disposal, dispersal, leaching or migration
of Hazardous Materials, including the movement of Hazardous Materials through or into the air, soil, surface water, groundwater
or real property.
“Representative”
shall mean, with respect to any Person, such Person’s Affiliates and its and their respective officers, directors, managers,
partners, employees, accountants, counsel, financial advisors, consultants and other advisors, agents or representatives.
“Sanctioned
Country” shall mean, at any time, a country or territory which is itself the subject or target of comprehensive Sanctions
(at the time of this Agreement, Crimea, Cuba, Iran, North Korea and Syria).
“Sanctioned
Person” shall mean any Person that is the target of Sanctions, including (a) any Person listed in any Sanctions-related
list of designated Persons maintained by OFAC or the U.S. Department of State, the United Nations Security Council, the European
Union, Her Majesty’s Treasury of the United Kingdom, Switzerland or any European Union member state, (b) any Person located,
organized or resident in a Sanctioned Country, or (c) any Person 50% or more owned or otherwise controlled by any such Person
or Persons described in the foregoing clauses (a) and (b).
“Sanctions”
shall mean economic or financial sanctions or trade embargoes imposed, administered or enforced from time to time by the U.S.
government through OFAC or the U.S. Department of State, the United Nations Security Council, the European Union or any European
Union member state, Her Majesty’s Treasury of the United Kingdom or Switzerland.
“Sarbanes-Oxley
Act” shall mean the Sarbanes-Oxley Act of 2002, as amended.
“SEC”
shall mean the United States Securities and Exchange Commission.
“Securities
Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
“Security”
shall mean, with respect to any Person, any series of common stock, preferred stock and any other equity interest or capital stock
of such Person (including interests or rights of any kind convertible into or exchangeable or exercisable for any equity interest
in any such series of common stock, preferred stock or any other equity interest or capital stock of such Person), however described
and whether voting or non-voting.
“Software”
shall mean any and all (a) computer programs, including any and all software implementations of algorithms, models and methodologies,
whether in source code or object code, (b) databases and compilations, including any and all data and collections of data, whether
machine readable or otherwise, including program files, data files, computer-related data, field and data definitions and relationships,
data definition specifications, data models, program and system logic, interfaces, program modules, routines, sub-routines, algorithms,
program architecture, design concepts, system designs, program structure, sequence and organization, screen displays and report
layouts, (c) descriptions, flow charts and other work product used to design, plan, organize and develop any of the foregoing,
screens, user interfaces, report formats, firmware, development tools, templates, menus, buttons and icons, and (d) all documentation
including user manuals and other training documentation related to any of the foregoing, and any improvements, updates, upgrades
or derivative works of any of the foregoing.
“Subsidiary”
of a Person shall mean any other Person with respect to which the first Person (a) has the right to elect a majority of the board
of directors or other Persons performing similar functions or (b) beneficially owns more than fifty percent (50%) of the voting
stock (or of any other form of voting or controlling equity interest in the case of a Person that is not a corporation), in each
case, directly or indirectly through one or more other Persons.
“Tax”
or “Taxes” shall mean any foreign, federal, state, provincial or local income, earnings, profits, gross receipts,
franchise, capital stock, net worth, sales, use, value added, occupancy, general property, real property, personal property, intangible
property, transfer, fuel, excise, escheat, unclaimed property (regardless of whether such escheat or unclaimed property is considered
a Tax under applicable law), payroll, withholding (including under Section 409A of the Code), unemployment compensation, social
security, retirement, environmental (including any Taxes imposed under Section 59A of the Code) or other tax of any nature; or
any deficiency, interest or penalty imposed with respect to any of the foregoing (or for the failure to file a Tax Return or a
complete and accurate Tax Return).
“Tax
Returns” shall mean any return, report, information statement, declaration, claim for refund or other similar filing,
including any schedule or attachment thereto, and including any amendment thereof, filed or required to be filed with a Governmental
Authority with respect to Taxes.
“Trade
Secrets” shall mean all trade secrets (protectable as such in any applicable jurisdiction), know-how and confidential
or other proprietary information relating to technical, engineering, manufacturing, processing, marketing, financial, or business
matters, including new developments, inventions and discoveries (whether patentable or not and whether or not reduced to practice
and all improvements thereto), invention disclosures, processes, blueprints, manufacturing, engineering and other drawings and
manuals, recipes, research data and results, flowcharts, diagrams, schematics, chemical compositions, formulae, diaries, notebooks,
lab journals, design and engineering specifications and similar materials recording or evidencing expertise or information, designs,
methods of manufacture, processing techniques, data processing techniques, compilation of information, customer, vendor and supplier
lists, pricing and cost information, and business and marketing plans and proposals, all related documents thereof, and all claims
and rights related thereto.
“Trademarks”
shall mean any and all registered or unregistered trademarks, service marks, trade dress, trade names, corporate names, assumed
financial business names, logos, slogans, Internet domain names, and any other source or business identifiers, and all applications,
registrations and renewals in connection therewith throughout the world, and all goodwill associated with any of the foregoing.
“Treasury
Regulations” shall mean regulations promulgated by the IRS under the Code.
“2014
Warrant” shall mean the warrant to purchase shares of Company Common Stock, dated as of August 12, 2014.
(b) The
terms set forth below shall have the meanings ascribed thereto in the referenced sections:
Agreement
|
|
Preamble
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AKS
|
|
Section 3.24(h)
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Alternative Acquisition Agreement
|
|
Section 5.5(a)
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Anti-Corruption Laws
|
|
Section 3.21(a)
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Antitrust Laws
|
|
Section 3.5(b)
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Benefit Plan
|
|
Section 3.12(a)
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Book-Entry Shares
|
|
Section 2.1(b)
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Bylaws
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Section 3.1(a)
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Canceled Shares
|
|
Section 2.1(a)(iii)
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Capitalization Date
|
|
Section 3.2(a)
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Certificate of Incorporation
|
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Section 3.1(a)
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Certificate of Merger
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Section 1.3
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Certificates
|
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Section 2.1(b)
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Closing
|
|
Section 1.2
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Closing Date
|
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Section 1.2
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COBRA
|
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Section 3.12(g)
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Common Stock Consideration
|
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Section 2.1(a)(i)
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Company
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Preamble
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Company 401(k) Plan
|
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Section 5.10(d)
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Company Adverse Recommendation Change
|
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Section 5.5(c)
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Company Board
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Recitals
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Company Leased Property
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Section 3.17(b)
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Company Material Contract
|
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Section 3.15(a)
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Company Option Grant Date
|
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Section 3.2(b)
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Company Permits
|
|
Section 3.10(a)
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Company Preferred Stock
|
|
Section 3.2(a)
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Company SEC Documents
|
|
Section 3.6(a)
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Company Stockholder Approval
|
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Section 3.4
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Company Stockholders’ Meeting
|
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Section 5.2(d)
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Consent
|
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Section 3.5(b)
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Continuing Employee
|
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Section 5.10(a)
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D&O Indemnified Parties
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Section 5.6(a)
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Data Protection Laws
|
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Section 3.16(q)
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Demand Registration Rights Agreements
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Section 3.2(f)
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DGCL
|
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Recitals
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Dissenting Shares
|
|
Section 2.6
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Divestiture Action
|
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Section 5.3(d)
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Effective Time
|
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Section 1.3
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Enforceability Exceptions
|
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Section 3.3(a)
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ERISA
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Section 3.12(a)
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FDA
|
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Section 3.23(a)
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Federal Health Care Program
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Section 3.24(b)
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Federal Health Care Program Laws
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Section 3.24(c)
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HIPAA
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Section 3.24(c)
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Labor Agreement
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Section 3.13(a)(ii)
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Lease
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Section 3.17(b)
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Material Supplier
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Section 3.19(c)
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Merger
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Recitals
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Merger Sub
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Preamble
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Option Consideration
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Section 2.4(a)
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Parent
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|
Preamble
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Parent 401(k) Plan
|
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Section 5.10(d)
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Parent Material Adverse Effect
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Section 4.1
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Paying Agent
|
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Section 2.2(a)
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Payment Fund
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Section 2.2(a)
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Payoff Letter
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Section 5.13
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Preferred Stock Consideration
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Section 2.1(a)(ii)
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Preferred Stockholder Letter
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Section 2.4(d)
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Privacy Requirements
|
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Section 3.16(q)
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Proxy Statement
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Section 3.11
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Restrictive Business Arrangement
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Section 3.15(a)(xi)
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RSU Consideration
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Section 2.4(b)
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Series A Preferred Stock
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Section 3.2(a)
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Series A-1 Preferred Stock
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Section 3.2(a)
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Siemens Healthineers
|
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Section 4.7
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SSA
|
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Section 3.24(b)
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Surviving Corporation
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Section 1.1
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Termination Date
|
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Section 7.1(b)(i)
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Voting and Support Agreement
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Recitals
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WARN Act
|
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Section 3.13(b)
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Warrant Consideration
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Section 2.3
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[Remainder
of page intentionally left blank; signature pages follow]
IN
WITNESS WHEREOF, Parent, Merger Sub and the Company have caused this Agreement to be executed as of the date first written above
by their respective officers thereunto duly authorized.
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SIEMENS MEDICAL SOLUTIONS USA, INC.
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By:
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/s/ David Pacitti
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Name: David Pacitti
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Title: President
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By:
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/s/ Ann Custin
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Name: Ann Custin
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Title: Executive Vice President, Treasurer &
CFO Americas
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CORPUS MERGER, INC.
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By:
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/s/ David Pacitii
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Name: David Pacitti
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Title: President
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By:
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/s/ Ann Custin
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Name: Ann Custin
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Title: Vice President & Chief Financial
Officer
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[Signature
Page to Agreement and Plan of Merger]
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CORINDUS VASCULAR
ROBOTICS, INC.
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By:
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/s/ Mark J. Toland
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Name:
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Mark J. Toland
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Title:
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Chief Executive Officer and President
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[Signature
Page to Agreement and Plan of Merger]
Exhibit
A
FORM OF VOTING AND SUPPORT AGREEMENT
This VOTING AND
SUPPORT AGREEMENT (this “Agreement”), dated as of August 7, 2019, is entered into by and between Siemens Medical
Solutions USA, Inc., a Delaware corporation (“Parent”), and the undersigned entities listed on the signature
pages hereto (each such entity, “Stockholder”) of Corindus Vascular Robotics, Inc., a Delaware corporation (the
“Company”). Parent and each Stockholder are referred to individually as a “Party” and collectively
as the “Parties.”
WITNESSETH
WHEREAS, concurrently
with the execution of this Agreement, Parent, the Company, and Corpus Merger, Inc., a Delaware corporation and a direct or indirect
wholly owned subsidiary of Parent (“Merger Sub”), are entering into an Agreement and Plan of Merger, dated as
of the date hereof (as amended, supplemented, or otherwise modified from time to time, the “Merger Agreement”),
pursuant to which, subject to the terms and conditions thereof, among other things, Merger Sub will merge with and into the Company
(the “Merger”) with the Company continuing as the surviving entity and a wholly owned subsidiary of Parent;
WHEREAS, as of the
date hereof, each Stockholder Beneficially Owns (as defined below) and owns of record the number of shares of common stock, par
value $0.0001 per share, of the Company (“Company Common Stock”) set forth opposite such Stockholder’s
name on Schedule I hereto (the “Existing Securities”); and
WHEREAS, as a condition
and inducement to Parent’s willingness to enter into the Merger Agreement, each Stockholder has agreed to enter into this
Agreement.
NOW THEREFORE, in
consideration of the foregoing and the representations, warranties, covenants and agreements contained herein, and intending to
be legally bound hereby, the Parties agree as follows:
1.
Definitions.
1.1.
Defined Terms. The following terms, as used in this Agreement, shall have the meanings
specified in this Section 1.1. Capitalized terms used but not otherwise defined herein shall have the meanings ascribed
thereto in the Merger Agreement.
1.1.1.
“Beneficial Owner” shall have the meaning given to such term in Rule 13d-3
under the Exchange Act (without giving effect to the limiting phrase “within sixty days” set forth in Rule 13d-3(d)(1)(i));
provided, that Parent shall not be deemed to be the Beneficial Owner of the Covered Company Securities by virtue of this
Agreement. The terms “Beneficially Own,” “Beneficially Owned,” and “Beneficial Ownership”
shall have a correlative meaning.
1.1.2.
“Covered Company Securities” means, with respect to each Stockholder, (a) such
Stockholder’s Existing Securities and (b) any shares of Company Common Stock, Company Preferred Stock, or other voting
capital stock of the Company and any Securities convertible into or exercisable or exchangeable for shares of Company Common Stock,
Company Preferred Stock, or other voting capital stock of the Company, in each case that such Stockholder has Beneficial Ownership
of on or after the date hereof; it being understood that if such Stockholder acquires Securities (or rights with respect thereto)
described in clause (b) above (to the extent such Securities are not timely reported, or required to be reported, in a filing
by such Stockholder with the SEC), such Stockholder shall promptly notify Parent in writing, indicating the number of such Securities
so acquired.
1.1.3.
“Permitted Transfer” means a Transfer of Covered Company Securities by
each Stockholder (a) in connection with the exercise, conversion, vesting or settlement of Company Equity Awards or Company Preferred
Stock (including the net settlement of such equity or sale of underlying shares of Company Common Stock in order to pay any exercise
price and any tax withholding obligations in connection therewith), or (b) to any Affiliate of such Stockholder; provided,
however, that in the case of the foregoing clause (b), any such Transfer shall only be a Permitted Transfer if and to the
extent that the transferee of such Covered Company Securities evidences in a writing in form and substance reasonably satisfactory
to Parent such transferee’s agreement to be bound by and subject to the terms and provisions hereof to the same effect as
the transferring Stockholder, and upon such transfer to be deemed a Stockholder hereunder.
1.1.4.
“Transfer” means any direct or indirect sale, assignment, encumbrance,
pledge, hypothecation, disposition or other transfer (by operation of law or otherwise), or entry into any contract, option or
other arrangement or understanding with respect to any sale, assignment, encumbrance, pledge, hypothecation, disposition or other
transfer (by operation of law or otherwise), of any capital stock or other Securities or interest (including voting interest) in
any capital stock or other Securities (including any Covered Company Securities) (it being understood that no Transfer shall be
deemed to be made by Stockholder solely as a result of transfers of limited partnership (or similar) interests in such Stockholder
or any Person owning such Stockholder).
2.
Voting Agreement.
2.1.
Agreement to Vote.
2.1.1.
Each Stockholder hereby irrevocably and unconditionally agrees that, during the term of this
Agreement, at the Company Stockholders’ Meeting and at any other meeting of the stockholders of the Company, however called,
including any adjournment or postponement thereof, and in connection with any written consent of the stockholders of the Company
(the date of the taking of any such action being an applicable “Determination Date”), such Stockholder shall,
in each case to the extent that the Covered Company Securities are entitled to vote thereon or consent thereto: (a) appear at each
such meeting or otherwise cause all of such Stockholder’s Covered Company Securities to be counted as present thereat for
purposes of calculating a quorum; and (b) vote (or cause to be voted), in person or by proxy, or if applicable deliver (or cause
to be delivered) a written consent covering, all of such Stockholder’s Covered Company Securities:
2.1.1.1.
in favor of the adoption of the Merger Agreement and approval of the Merger and the transactions
contemplated thereby;
2.1.1.2.
in favor of any proposal to adjourn a meeting of the stockholders of the Company to solicit
additional proxies in favor of the adoption of the Merger, the Merger Agreement, and the transactions contemplated thereby;
2.1.1.3.
against any Company Acquisition Proposal; and
2.1.1.4.
against any other action, agreement or transaction that would reasonably be expected to impede,
interfere with, delay, postpone or adversely affect the Merger or the other transactions contemplated by the Merger Agreement (including
the consummation in each case thereof) or this Agreement or the performance by the Company of its obligations under the Merger
Agreement or by such Stockholder of its obligations under this Agreement.
2.1.1.5.
Each Stockholder is entering into this Agreement solely in its capacity as the owner of such
Stockholder’s shares of Company Common Stock. Notwithstanding any provision of this Agreement to the contrary, nothing in
this Agreement shall limit or restrict a designee of a Stockholder who is a director of the Company from acting in such capacity
or fulfilling the obligations of such office, including by acting or voting in his capacity as a director of the Company. For the
avoidance of doubt, any such designee is a Non-Recourse Party.
2.1.2.
Any vote required to be cast or consent required to be executed pursuant to Section 2.1.1
shall be cast or executed in accordance with the applicable procedures relating thereto so as to ensure that it is duly counted
for purposes of determining that a quorum is present (if applicable) and for purposes of recording the results of that vote or
consent. Nothing contained in this Agreement shall require a Stockholder (or shall entitle any proxy of a Stockholder) to convert,
exercise or exchange any option, warrants or convertible securities in order to obtain any underlying shares of Company Common
Stock.
2.2.
No Inconsistent Agreements. Each Stockholder represents, covenants and agrees that,
except for this Agreement, such Stockholder (a) has not entered into, nor shall it enter into at any time while this Agreement
remains in effect, any voting agreement, voting trust or similar arrangement or understanding with respect to any Covered Company
Securities, and (b) has not granted, nor shall it grant at any time while this Agreement remains in effect, a proxy (except
in accordance with Section 2.1.1 hereof), consent or power of attorney with respect to any Covered Company Securities.
3.
Other Covenants.
3.1.
Restrictions on Transfers. Each Stockholder hereby agrees that, during the Voting Period,
(a) such Stockholder shall not, directly or indirectly, Transfer or consent to a Transfer of any Covered Company Securities or
any Beneficial Ownership interest or any other interest therein unless such Transfer is a Permitted Transfer and (b) any Transfer
in violation of this provision shall be void.
3.2.
Waiver of Appraisal Rights; Litigation. Each Stockholder hereby irrevocably and unconditionally
waives, and agrees not to exercise, assert or perfect (or attempt to exercise, assert or perfect), any rights of appraisal or rights
to dissent from the Merger that it may at any time have under applicable Law. Each Stockholder agrees not to commence, join in,
facilitate, assist or encourage any claim, derivative or otherwise, against Parent, Merger Sub, the Company or any of their respective
successors or Representatives (a) challenging the validity of, or seeking to enjoin the operation of, any provision of this
Agreement, (b) alleging a breach of any fiduciary duty of any Person in connection with the evaluation, negotiation or entry
into the Merger Agreement or (c) otherwise relating to the Merger Agreement, this Agreement or the Merger or other transactions
contemplated by the Merger Agreement or this Agreement; provided, however, that the foregoing shall not restrict
such Stockholder from enforcing any of his, her or its rights under the Merger Agreement or this Agreement.
3.3.
Stock Dividends, Distributions, Etc. In the event of a stock split, reverse stock split,
stock dividend or distribution, or any change in the Company Stock by reason of any recapitalization, combination, reclassification,
exchange of shares or similar transaction, the terms “Existing Securities” and “Covered Company Securities”
shall be deemed to refer to and include all such stock dividends and distributions and any Securities into which or for which any
or all of such shares may be changed or exchanged or which are received in such transaction.
4.
Representations and Warranties.
4.1.
Representations and Warranties of Each Stockholder. Each Stockholder hereby represents
and warrants to Parent as follows:
4.1.1.
Organization. Such Stockholder is duly organized and validly existing under the Laws
of the jurisdiction of its incorporation, formation or organization, as applicable.
4.1.2.
Authority; Execution and Delivery; Enforceability. Such Stockholder has all necessary
corporate or other entity power and authority to execute, deliver and perform its obligations under this Agreement. The execution,
delivery and performance by such Stockholder of this Agreement and the compliance by such Stockholder with each of its obligations
herein have been duly and validly authorized by all necessary corporate or other entity action on the part of such Stockholder.
Such Stockholder has duly executed and delivered this Agreement and, assuming the due authorization, execution and delivery by
Parent of this Agreement, this Agreement constitutes such Stockholder’s legal, valid and binding obligation, enforceable
against such Stockholder in accordance with its terms, except that such enforcement may be subject to the Enforceability Exceptions.
4.1.3.
Ownership of Shares. As of the date hereof, except as described in Schedule I
hereto, such Stockholder is the sole Beneficial Owner of the Existing Securities set forth opposite such Stockholder’s name
on Schedule I hereto, free and clear of any Liens and free of any limitation or restriction on the right to vote, sell,
transfer, convert, exercise or otherwise dispose of such Existing Securities (other than (a) this Agreement, (b) any limitations
or restrictions imposed under applicable Laws, or (c) pursuant to the terms of any Company Equity Awards or any employee benefit
plan of the Company), and such Existing Securities constitute all of the shares of Company Common Stock or other Securities of
the Company Beneficially Owned or owned of record by such Stockholder. Except as set forth on Schedule I hereto, such Stockholder
has and will have at all times through the Voting Period (except to the extent such Existing Securities are transferred after the
date hereof pursuant to a Permitted Transfer) sole voting power (including the right to control such vote as contemplated herein),
sole power of disposition, sole power to issue instructions with respect to the matters set forth in Section 2.1 hereof,
sole power to convert or exercise and sole power to agree to all of the matters set forth in this Agreement, in each case with
respect to all of such Stockholder’s Existing Securities.
4.1.4.
No Conflicts. Neither the execution and delivery of this Agreement by such Stockholder
nor compliance by such Stockholder with any of the terms or provisions hereof will (a) violate
any provision of the certificate of incorporation, bylaws, or other organizational or governing documents of such Stockholder,
(b) in any material respect, conflict with or violate any Law applicable to such Stockholder or by which such Stockholder’s
properties or assets are bound or affected, (c) violate, conflict with, result in any breach of any provision of, or result
in the loss of any benefit under, constitute a default (with or without notice or lapse of time, or both) under, give rise to any
right of termination, acceleration or cancellation under, or require the consent of, notice to, or filing with any third party
pursuant to any terms or provisions of any material Contract to which such Stockholder is a party or by which any property or asset
of such Stockholder is bound or affected, or result in the creation of any Lien (other than any Permitted Lien) upon any of the
properties or assets of such Stockholder (including any Company Covered Securities), except, in the case of the foregoing clauses
(b) and (c), for such violations as, individually or in the aggregate, would not reasonably be expected to impair such Stockholder’s
ability to perform its obligations under this Agreement on a timely basis.
4.1.5.
Consents and Approvals. The execution, delivery and performance by such Stockholder
of this Agreement does not and will not require any Consent of, or filing with, any Governmental Authority (excluding filings with
the SEC under applicable securities Law and applicable Antitrust Law).
4.1.6.
Legal Proceedings. As of the date of this Agreement, there are no Proceedings pending
or, to the knowledge of such Stockholder, threatened against such Stockholder or any of such Stockholder’s assets or properties
that would reasonably be expected to impair such Stockholder’s ability to perform such Stockholder’s obligations under
this Agreement on a timely basis. No Stockholder nor any of such Stockholder’s properties or assets is or are subject to
any Order that would reasonably be expected to impair such Stockholder’s ability to perform its obligations under this Agreement
on a timely basis.
4.1.7.
No Other Representations. Such Stockholder acknowledges and agrees that other than
the representations expressly set forth in this Agreement, Parent has not made and is not making any representations or warranties
to such Stockholder, including with respect to Parent, the Merger Agreement or any other matter. Such Stockholder hereby specifically
disclaims reliance upon any representations or warranties (other than the representations expressly set forth in this Agreement).
4.2.
Representations and Warranties of Parent. Parent hereby represents and warrants to
each Stockholder as follows:
4.2.1.
Organization. Parent is duly organized and validly existing under the Laws of the jurisdiction
of its incorporation.
4.2.2.
Authority; Execution and Delivery; Enforceability. Parent has all necessary corporate
power and authority to execute, deliver and perform its obligations under this Agreement. The execution, delivery and performance
by Parent of this Agreement and the compliance by Parent with each of its obligations herein have been duly and validly authorized
by all necessary corporate action on the part of Parent. Parent has duly executed and delivered this Agreement and, assuming the
due authorization, execution and delivery by each Stockholder of this Agreement, this Agreement constitutes Parent’s legal,
valid and binding obligation, enforceable against it in accordance with its terms, except that such enforcement may be subject
to the Enforceability Exceptions.
4.2.3.
No Conflicts. Neither the execution and delivery of this Agreement by Parent nor compliance
by Parent with any of the terms or provisions hereof will (a) violate any provision of the organizational documents of Parent,
(b) in any material respect, conflict with or violate any Law applicable to Parent or by which any of Parent’s properties
or assets are bound or affected, (c) violate, conflict with or result in any breach of any provision of, or result in the
loss of any benefit under, constitute a default (with or without notice or lapse of time, or both) under, give rise to any right
of termination, acceleration or cancellation under, or require the consent of, notice to or filing with any third party pursuant
to any of the terms or provisions of any material Contract to which Parent is a party or by which any property or asset of Parent
is bound or affected, or result in the creation of any Lien (other than any Permitted Lien) upon any of the properties or assets
of Parent, except, in the case of the foregoing clauses (b) and (c), for such violations as, individually or in the aggregate,
would not reasonably be expected to impair Parent’s ability to perform its obligations under this Agreement on a timely basis.
4.2.4.
No Other Representations. Parent acknowledges and agrees that other than the representations
expressly set forth in this Agreement, each Stockholder has not made and is not making any representations or warranties to Parent,
including with respect to the Company, such Stockholder’s ownership of Company Common Stock, the Merger Agreement or any
other matter. Parent hereby specifically disclaims reliance upon any representations or warranties (other than the representations
expressly set forth in this Agreement).
5.
Termination.
5.1.
Termination. This Agreement shall terminate upon the earliest to occur of (a) the
termination of this Agreement by the mutual written consent of Parent and each Stockholder; (b) the termination of the Merger
Agreement in accordance with its terms prior to the Effective Time; (c) the date on which the Company Board makes a Company Adverse
Recommendation Change subject to the applicable terms and conditions of the Merger Agreement; (d) the Effective Time; (e)
the Outside Date (as defined in the Merger Agreement in effect on the date hereof); and (f) any amendment, supplement, waiver or
other modification, of any provision of the Merger Agreement without the prior written consent of each Stockholder that (i) decreases
the amount or changes the form of the applicable Merger Consideration, (ii) imposes any additional restrictions on or additional
conditions on the payment of the applicable Merger Consideration to stockholders of the Company, (iii) imposes any additional restrictions
or obligations on the Stockholder, or (iv) otherwise adversely effects a Stockholder in any material respect.
5.2.
Effect of Termination. In the event of the termination of this Agreement in accordance
with Section 5.1, this Agreement shall forthwith become void and have no effect, and there shall not be any liability
or obligation on the part of any Party hereto, other than this Section 5.2 and Article VI, which provisions
shall survive such termination.
6.
Miscellaneous.
6.1.
No Ownership Interest. Nothing contained in this Agreement shall be deemed to vest
in Parent any direct or indirect ownership or incidence of ownership of or with respect to any Covered Company Securities. All
rights, ownership and economic benefits of and relating to the Covered Company Securities shall remain vested in and belong to
each Stockholder, and Parent shall have no authority to direct such Stockholder in the voting or disposition of any of the Covered
Company Securities, except as otherwise provided herein.
6.2.
Further Assurances. Each of the Parties agrees that, upon the reasonable request of
the other Party, it shall use reasonable best efforts to take, or cause to be taken, such further actions as may be reasonably
necessary, proper or advisable to comply with its obligations hereunder, including by executing and delivering additional documents.
6.3.
Amendment and Modification; Waiver. This Agreement may not be amended, modified or
supplemented, except by an instrument in writing signed on behalf of each of the Parties hereto. Any agreement on the part of a
Party to any waiver of any obligation of the other Parties shall be valid only if set forth in an instrument in writing signed
on behalf of such waiving Party. The failure of any Party to assert any of its rights under this Agreement or otherwise shall not
constitute a waiver of such rights, nor shall any single or partial exercise by any Party of any of its rights under this Agreement
preclude any other or further exercise of such rights or any other rights under this Agreement.
6.4.
Notices. All notices required to be given under this Agreement shall be in writing
and shall be deemed to have been given (a) when personally delivered or sent by confirmed telecopy (with hard copy to follow);
(b) one (1) Business Day after being sent by reputable overnight express courier (charges prepaid); or (c) five
(5) Business Days following mailing by certified or registered mail, postage prepaid and return receipt requested. Unless
another address is specified in writing, such notices shall be sent to the addresses indicated below:
if to Parent, to:
Siemens Medical Solutions USA, Inc.
40 Liberty Blvd.
Malvern, PA 19355
Attention: General Counsel
Email: kevin.royer@siemens-healthineers.com
with a copy (which shall not constitute notice) to:
Blank Rome LLP
1271 Avenue of the Americas
New York, NY 10020
Attention: Gary Goldenberg; Alan Lieblich; Shaun Snitman
Email: goldenberg@blankrome.com; lieblich@blankrome.com; ssnitman@blankrome.com
if to a Stockholder,
to the address set forth under such Stockholder’s name on the signature page hereof.
6.5.
Counterparts. This Agreement may be executed in multiple counterparts, all of which
shall together be considered one and the same agreement. Delivery of an executed signature page to this Agreement by electronic
transmission shall be as effective as delivery of a manually signed counterpart of this Agreement.
6.6.
Entire Agreement; Third Party Beneficiaries. This Agreement (including the Schedules
hereto and, to the extent referred to in this Agreement, the Merger Agreement, together with the several agreements and other documents
and instruments referred to herein or therein or annexed hereto or thereto) (a) constitutes the entire agreement and supersedes
all prior agreements and understandings, both written and oral, among the Parties with respect to the subject matter hereof and
thereof and (b) is not intended to and shall not confer any rights, benefits, remedies, obligations or liabilities upon any
Person other than the Parties hereto and their respective permitted successors and assigns.
6.7.
Severability. If any term, provision, covenant or restriction of this Agreement is
held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms,
provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected,
impaired or invalidated. Upon such determination, the Parties shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the Parties as closely as possible in a mutually acceptable manner in order that the intent of this Agreement
and the transactions contemplated hereby be fulfilled as originally contemplated to the fullest extent possible.
6.8.
Assignment. Neither this Agreement nor any of the rights, interests or obligations
hereunder shall be assigned by any of the Parties hereto (whether by operation of Law or otherwise) without the prior written consent
of the other Parties, and any such assignment without such consent shall be null and void. Subject to the foregoing, this Agreement
shall be binding upon, inure to the benefit of and be enforceable by the Parties and their respective permitted successors and
assigns.
6.9.
Headings; Interpretation. In this Agreement, unless expressly stated otherwise, (a)
the singular includes the plural and vice versa; (b) reference to any Person includes such Person's legally permitted successors
and assigns; (c) reference to any agreement, document or instrument means such agreement, document, or instrument as amended or
modified and in effect from time to time in accordance with its terms; (d) reference to any Law means that Law as from time to
time in effect, including any amendment, modification, codification, replacement or reenactment of such Law; (e) the terms “hereunder,”
“hereof,” “hereto,” and words of similar import refer to this Agreement as a whole and not to any particular
Article, Section or other provision of this Agreement; (f) the term “including” (and with correlative meaning “include”)
means including without limiting the generality of any description preceding such term; (g) the term “or” is used in
the inclusive sense of “and/or”; (h) the term “any” means “any and all”; (i) with respect to
the determination of any period of time, “from” means “from and including” and “to” means “to
but excluding”; (j) a reference to a document, instrument or agreement also refers to all addenda, exhibits or schedules
thereto; (k) references in any Section to any clause are references to such clause of such Section; (l) references to “dollars”
or “$” refers to United States dollars; and (m) references in this Agreement to any Article, Section or Schedule are
references to such Article, Section or Schedule of this Agreement. This Agreement was negotiated by the Parties with the benefit
of legal representation, and any rule of construction or interpretation otherwise requiring this Agreement to be construed or interpreted
against any Party as having been drafted by it will not apply to any construction or interpretation of this Agreement. The headings
contained in this Agreement are for convenience of reference only, shall not be deemed to be part of this Agreement, and shall
not be referred to in connection with the construction or interpretation of this Agreement.
6.10.
Governing Law. This Agreement and all Proceedings (whether based on contract, tort
or otherwise) arising out of or relating to this Agreement or the actions of Parent or each Stockholder in the negotiation, administration,
performance and enforcement thereof, shall be governed by, and construed in accordance with, the Laws of the State of Delaware,
without giving effect to any choice or conflict of laws provision or rule (whether of the State of Delaware or any other jurisdiction)
that would cause the application of the Laws of any jurisdiction other than the State of Delaware.
6.11.
Specific Performance. The Parties hereto agree that irreparable damage for which monetary
damages, even if available, would not be an adequate remedy, would occur in the event that any Party hereto does not perform the
provisions of this Agreement in accordance with its specified terms or otherwise breach such provisions. Accordingly, the Parties
hereto acknowledge and agree that, prior to any termination of this Agreement in accordance with Section 5, in the
event of any breach or threatened breach by Parent, on the one hand, or any Stockholder, on the other hand, of any of their respective
covenants or obligations set forth in this Agreement, Parent, on the one hand, and such Stockholder, on the other hand, shall be
entitled to an injunction, specific performance and other equitable relief to prevent breaches of this Agreement and to enforce
specifically the terms and provisions hereof, in addition to any other remedy to which they are entitled at law or in equity. Each
of the Parties hereto agrees that it will not oppose the granting of an injunction, specific performance and other equitable relief
on the basis that any other Party has an adequate remedy at law or that any award of specific performance is not an appropriate
remedy for any reason at law or in equity. Any Party hereto seeking an injunction or injunctions to prevent breaches of this Agreement
and to enforce specifically the terms and provisions of this Agreement shall not be required to provide any bond or other security
in connection with any such order or injunction.
6.12.
Consent to Jurisdiction.
6.12.1.
Each of the Parties hereto, with respect to any legal claim or Proceeding arising out of this
Agreement or the transactions contemplated by this Agreement, (a) expressly and irrevocably submits, for itself and with respect
to its property, generally and unconditionally, to the exclusive jurisdiction of the Delaware Court of Chancery and any appellate
court therefrom within the State of Delaware (or, if the Delaware Court of Chancery declines to accept jurisdiction over a particular
matter, any state or federal court within the State of Delaware), (b) agrees that it will not attempt to deny or defeat such personal
jurisdiction by motion or other request for leave from any such courts, (c) agrees that it will not bring any claim or Proceeding
relating to this Agreement or the transactions contemplated by this Agreement except in such courts, and (d) irrevocably waives,
to the fullest extent it may legally and effectively do so, and agrees not to assert, by way of motion or as a defense, counterclaim
or otherwise, any objection which it may now or hereafter have to the laying of venue of any claim or Proceeding arising out of
or relating to this Agreement. Notwithstanding the foregoing, Parent and each Stockholder agrees that a final and nonappealable
judgment in any Proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by Law.
6.12.2.
Each Party hereto irrevocably consents to the service of process in any claim or Proceeding
with respect to this Agreement and the transactions contemplated by this Agreement or for recognition and enforcement of any judgment
in respect hereof brought by any other Party hereto may be made by mailing copies thereof by registered or certified United States
mail, postage prepaid, return receipt requested, to its address as specified in or pursuant to Section 6.4, and such
service of process shall be sufficient to confer personal jurisdiction over such party in such claim or Proceeding and shall otherwise
constitute effective and binding service in every respect.
6.13.
WAIVER OF JURY TRIAL. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ALL RIGHT
TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) BETWEEN ANY OF THEM ARISING
OUT OF OR RELATING TO THIS AGREEMENT OR THE ACTIONS OF ANY PARTY IN THE NEGOTIATION, ADMINISTRATION, PERFORMANCE, AND ENFORCEMENT
THEREOF.
6.14.
Capacity as a Stockholder. Each Stockholder makes its agreements and understandings
herein solely in its capacity as record holder and Beneficial Owner of the Covered Company Securities and, notwithstanding anything
to the contrary herein, nothing herein shall limit or affect any actions taken by such Stockholder or any Representative of such
Stockholder solely in his or her capacity as a director or officer of the Company.
6.15.
Expenses. All expenses incurred in connection with this Agreement and the transactions
contemplated by this Agreement shall be paid by the Party incurring such expenses, whether or not the Merger or the transactions
contemplated by the Merger Agreement are consummated.
6.16.
No Recourse. This Agreement may only be enforced against, and any claims or causes
of action that may be based upon, arise out of or relate to this Agreement, or the negotiation, execution or performance of this
Agreement may only be made against the Persons that are expressly identified as Parties hereto and no former, current or future
equity holders, controlling persons, directors, officers, employees, agents or Affiliates of any Party hereto or any former, current
or future stockholder, controlling person director officer, employee, general or limited partner, member manager, agent or Affiliate
of any of the foregoing (each, a “Non-Recourse Party”) shall have any liability for any obligations or liabilities
of the Parties to this Agreement or for any claim (whether in tort, contract or otherwise) based on, in respect of, or by reason
of, the transactions contemplated hereby or in respect of any representations made or alleged to be made in connection herewith.
Without limiting the rights of any Party against the other Parties hereto, in no event shall any Party or any of its Affiliates
seek to enforce this Agreement against, make any claims for breach of this Agreement against, or seek to recover monetary damages
from, any Non-Recourse Party. Notwithstanding the foregoing, this Section 6.16 shall in no way be deemed to limit (a) the
liability or obligations of any Party to the extent that such Party is required to cause it Subsidiaries or controlled Affiliates,
or to use reasonable best efforts to cause its Representatives, to take any action or refrain from taking any action pursuant to
this Agreement or (b) any remedy or rights available to Parent under the Merger Agreement.
[Remainder of this page intentionally
left blank]
IN WITNESS WHEREOF,
Parent and each Stockholder have duly executed this Agreement, all as of the date first written above.
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SIEMENS MEDICAL SOLUTIONS USA,
INC.
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By:
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Name:
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Title:
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By:
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Name:
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Title:
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STOCKHOLDER:
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By:
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Name:
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Address of Stockholder:
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[Signature Page to Voting and Support Agreement]
FORM OF SCHEDULE I TO VOTING AND SUPPORT
AGREEMENT
Stockholder
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Shares of Company Common Stock Beneficially Owned
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[Schedule I to Voting and
Support Agreement]
Exhibit
B
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
[SURVIVING CORPORATION]
FIRST: The
name of the corporation is ________________ (the “Corporation”).
Siemens Aktiengesellschaft with registered offices in Berlin and
Munich (“Siemens AG”) has granted the Corporation permission to use the “Siemens” name in
its company name. Siemens AG, its legal successors or authorized representatives may revoke this permission at any time and for
any reason or no reason by notifying the Corporation in writing. The permission shall expire without need of revocation immediately
as soon as Siemens AG ceases to hold, directly or indirectly, more than fifty (50) percent of the issued and authorized share capital
and voting rights and does not exercise control over the Corporation. Siemens AG shall be deemed to have an indirect holding of
more than fifty (50) percent if more than fifty (50) percent of the shareholders' interests and the voting rights are held at each
separate holding level. If the permission is revoked or expires, the Corporation and its members shall arrange for the name of
the Corporation to be changed within a period of ninety (90) days following such revocation or expiration. The new name of the
Corporation may contain neither the “Siemens” name nor a title that could be confused therewith or is otherwise similar
thereto nor any reference to a purported link with the Siemens group or its organization. Neither the Corporation nor its stockholders
shall have any entitlement to compensation in the event of the permission being revoked or expiring.
SECOND: The
address of the Corporation’s registered office in the State of Delaware is 1209 Orange Street, in the City of Wilmington,
County of New Castle, Delaware 19801. The name of its registered agent at such address is The Corporation Trust Company.
THIRD: The
purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware, as amended (the “DGCL”).
FOURTH: The
total number of shares of stock which the Corporation shall have authority to issue is 1,000 shares of Common Stock, par value
$0.0001 per share.
FIFTH: Election
of directors need not be by written ballot, unless the Amended and Restated Bylaws (“Bylaws”) of the
Corporation shall so provide.
SIXTH: The
Corporation reserves the right to amend, alter, change or repeal any provision contained in this Amended and Restated Certificate
of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted
subject to this reservation.
SEVENTH: In furtherance and not in limitation of the
powers conferred by the laws of the State of Delaware, the Board of Directors of the Corporation is expressly authorized and empowered
to make, alter or repeal the Bylaws as set forth in the Bylaws, subject to the power of the stockholders of the Corporation to
alter or repeal any bylaw made by the Board of Directors of the Corporation.
EIGHTH: No director of this Corporation
shall be personally liable to the Corporation or its stockholders for monetary damages for any breach of fiduciary duty by such
director as a director. Notwithstanding the foregoing sentence, a director shall be liable to the extent provided by applicable
law, (i) for breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions
not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the DGCL,
or (iv) for any transaction from which the director derived an improper personal benefit. No amendment to or repeal of this Article
EIGHTH shall apply to or have any adverse effect on the liability or alleged liability of any director of the Corporation for or
with respect to any acts or omissions of such director occurring prior to such amendment or repeal. Notwithstanding the foregoing,
if the DGCL is amended to authorize corporate action further eliminating or limiting the personal liability of directors, then
the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the DGCL, as so
amended. Notwithstanding the foregoing, no director of this Corporation shall be personally liable to the Corporation or its stockholders
for monetary damages for any breach of fiduciary duty owed to the Corporation or its stockholders occurring at or prior to the
effective time (the “Effective Time”) of the merger of Corpus Merger, Inc., a Delaware corporation (“Merger
Sub”), with and into the Corporation (the “Merger”) pursuant to the Agreement and Plan
of Merger, dated as of August 7, 2019, by and among Siemens Medical Solutions USA, Inc., Merger Sub and Corindus Vascular Robotics,
Inc. (“Target”).
NINTH: For a period of six (6) years
from the Effective Time, the exculpation, indemnification and advancement of expenses provisions of the Certificate of Incorporation
and Bylaws of Target as in effect immediately prior to the Effective Time shall survive and continue to be in full force and effect
solely with respect to acts or omissions of each of the directors and officers of Target occurring at or prior to the Effective
Time.
Exhibit
C
AMENDED AND RESTATED BYLAWS
OF
[SURVIVING CORPORATION]
ARTICLE I
Offices
Section 1.01 Registered
Office. The registered office of the Corporation shall be established and maintained at the office of The Corporation Trust
Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware, 19801, and said corporation shall be the Registered
Agent of this Corporation in charge thereof.
Section
1.02 Other Offices. The Corporation may have other offices, either within or without the State of Delaware, at
such place or places as the Board of Directors may from time to time appoint or the business of the Corporation may require.
ARTICLE II
Meetings of Stockholders
Section
2.01 Annual Meetings. Unless directors are elected by written consent in lieu of an annual meeting, an annual meeting
of stockholders shall be held for the election of directors and for such other business as may be stated in the notice of the meeting.
Such meeting shall be held at such place, either within or without the State of Delaware, and at such time and date as the Board
of Directors, by resolution, shall determine and as set forth in the notice of the meeting. At each annual meeting, the stockholders
entitled to vote shall elect a Board of Directors, and they may transact such other corporate business as shall be stated in the
notice of the meeting.
Section
2.02 Special Meetings. Meetings of stockholders for any purpose or purposes may be held at such time and place, within
or without the State of Delaware, as shall be stated in the notice of the meeting. Special meetings of the stockholders may be
called by the Chairman, the Senior Officer (as hereinafter defined) or the Secretary, or by resolution of the directors.
Section
2.03 Voting. Each stockholder entitled to vote in accordance with the terms of the Certificate of Incorporation
and in accordance with the provisions of these Bylaws shall be entitled to one vote, in person or by proxy, for each share of
stock entitled to vote held by such stockholder, but no proxy shall be voted after eleven months from its date unless such proxy
provides for a longer period. Upon the demand of any stockholder, the vote for directors and the vote upon any question before
the meeting shall be by written ballot. All elections for directors and all other questions shall be decided by majority vote
except as otherwise provided by the Certificate of Incorporation or the laws of the State of Delaware.
A complete
list of the stockholders entitled to vote at any meeting, arranged in alphabetical order, with the address of each, and the number
of shares held by each, shall be open to examination by any stockholder, for any purpose germane to the meeting, during ordinary
business hours for a period of at least ten days prior to the meeting at the principal business office of the Corporation. The
list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by
any stockholder who is present.
Section
2.04 Quorum. Except as otherwise required by law or by the Certificate of Incorporation, the presence, in person
or by proxy, of stockholders holding a majority of the stock of the Corporation entitled to vote shall constitute a quorum at all
meetings of the stockholders. In case a quorum shall not be present at any meeting, ·a majority in interest of the stockholders
entitled to vote thereat, present in person or by proxy, shall have power to adjourn the meeting from time to time, without notice
other than announcement at the meeting, until the requisite amount of stock entitled to vote shall be present. At any such adjourned
meeting at which the requisite amount of stock entitled to vote shall be represented, any business may be transacted which might
have been transacted at the meeting as originally noticed; but only those stockholders entitled to vote at the meeting as originally
noticed shall be entitled to vote at any adjournment or adjournments thereof. If the adjournment is for more than thirty days,
or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given
to each stockholder of record entitled to vote at the meeting.
Section
2.05 Notice of Meetings. Written notice, stating the place, date and time of the meeting, and the general nature
of the business to be considered, shall be given to each stockholder entitled to vote thereat at his or her address as it appears
on the records of the Corporation, not less than ten nor more than sixty days before the date of the meeting. No business other
than that stated in the notice shall be transacted at any meeting without the unanimous consent of all the stockholders entitled
to vote thereat.
Section
2.06 Action Without Meeting. Except as otherwise provided by the Certificate of Incorporation, whenever the vote
of stockholders at a meeting thereof is required or permitted to be taken in connection with any corporate action by any provisions
of statute, the Certificate of Incorporation, or these Bylaws, the meeting and vote of stockholders may be dispensed with, if
a consent in writing, setting forth the action taken, shall be signed by the holders of outstanding stock having not less than
the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled
to vote thereon were present and voted. Prompt notice of the taking of corporate action without a meeting by less than unanimous
written consent shall be given to those stockholders who have not consented in writing.
ARTICLE III
Directors
Section
3.01 Number and Term. The number of directors which shall constitute the entire Board of Directors of this Corporation
shall be not less than two; the exact number shall be determined by resolution of the directors or the stockholders. Unless directors
are elected by written consent in lieu of an annual meeting, the Board of Directors shall be elected at each annual meeting of
the stockholders. Each director shall hold office until his or her successor shall be elected and shall qualify or until such director’s
earlier resignation or removal. Directors need not be stockholders.
Section
3.02 Resignations. Any director or member of a committee may resign at any time. Such resignation shall be made in
writing, and shall take effect at the time specified therein, and if no time be specified, at the time of its receipt by the Chairman,
the Senior Officer or by the Secretary. The acceptance of a resignation shall not be necessary to make it effective.
Section
3.03 Vacancies. If the office of any director or member of a committee becomes vacant, for any reason, the remaining
directors in office, though less than a quorum, by a majority vote, or the sole remaining director, may appoint any qualified person
to fill such vacancy, who shall hold office for the unexpired term and until such director’s successor shall be elected and
shall qualify or until such director’s earlier resignation or removal.
Section 3.04 Removal.
Any director may be removed either for or without cause at any time by the affirmative vote of the holders of a majority of all
the shares of stock outstanding and entitled to vote, at a special meeting of the stockholders called for the purpose, and the
vacancies thus created may be filled at such meeting by the affirmative vote of a majority in interest of the stockholders entitled
to vote.
Section
3.05 Increase of Number. The number of directors may be increased by the affirmative vote of a majority of the directors
at any duly constituted Board Meeting or by the affirmative vote of a majority in interest of the stockholders at the Annual Meeting
of Stockholders or at a Special Meeting of Stockholders called for that purpose, and by like vote the additional directors may
be elected at such meetings to hold office until the election and qualification of their successors or until their earlier resignation
or removal.
Section
3.06 Powers. The Board of Directors shall exercise all of the powers of the Corporation except such as are by
law, the Certificate of Incorporation, or these Bylaws conferred upon or reserved to the stockholders.
Section
3.07 Committees. The Board of Directors may, by resolution passed by a majority of the whole Board, designate one
or more committees, each committee to consist of two or more of the directors of the Corporation. The Board may designate one or
more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee.
In the absence or disqualification of any member of any such committee, the member or members thereof present at any meeting and
not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member
of the Board of Directors to act at the meeting in the place of any such absent or disqualified member. Any such committee, to
the extent provided in the resolution designating such committee, shall have and may exercise all of the powers of the Board of
Directors in the management of the business and affairs of the Corporation; provided, however, that no such committee shall have
power or authority in reference to amending the Certificate of Incorporation of the Corporation, adopting an agreement of merger
or consolidation, recommending to the stockholders the sale, lease or exchange of all or substantially all of the Corporation’s
property and assets, recommending to the stockholders a dissolution of the Corporation or a revocation of a dissolution, or amending
these Bylaws; and, unless the resolution expressly so provides, no such committee shall have the power or authority to declare
a dividend or to authorize the issuance of stock. Such committee or committees shall have such name or names as may be determined
from time to time by resolution adopted by the Board of Directors. Each committee shall keep regular minutes of its meetings and
report the same to the Board of Directors when required.
Section 3.08 Meetings.
Unless directors were elected by written consent in lieu of an annual meeting, the newly elected directors shall hold their first
meeting for the purpose of organization and the transaction of business, if a quorum be present, immediately after the annual meeting
of the stockholders; or the time and place of such meeting may be fixed by consent in writing of all the directors. This meeting
(or Board action by consent in lieu of a meeting) shall be called the Annual Meeting of the Board. At each annual meeting, the
Board shall elect a slate of officers, Board Committees, if any, and they may transact such other corporate business as shall be
stated in the notice of the meeting. Regular meetings of the Board of Directors may be held without notice if the time and place
of such meetings are fixed by the Board of Directors. Special Meetings of the Board of Directors may be called by the Chairman,
the Senior Officer, or the Secretary, or on the written request of any two directors on at least two days’ notice to each
director and shall be held at such place or places as may be determined by the directors, or as shall be stated in the call of
the meeting.
Section
3.09 Quorum and Manner of Action. A majority of the directors shall constitute a quorum for the transaction of business.
If at any meeting of the Board there shall be less than a quorum present, a majority of those present may adjourn the meeting
from time to time until a quorum is obtained, and no further notice thereof need be given other than by announcement at the meeting
which shall be so adjourned. Action by the Board shall be effective when taken by majority vote of those present at a meeting
at which a quorum is present, unless otherwise required by law, by the Certificate of Incorporation, or by these Bylaws.